Startup Company Offer Letters, Employment Agreements, and Equity Compensation | Practical Law

Startup Company Offer Letters, Employment Agreements, and Equity Compensation | Practical Law

A Practice Note addressing the key issues that startup companies should consider when entering into employment-related agreements (such as offer letters or employment agreements) with founders, employees, and executives at various stages of a startup's lifecycle. This Note covers equity compensation issues, including issuing restricted stock to founders and employees; granting stock options, such as incentive stock options (ISOs), non-qualified or non-statutory stock options (NSOs), or restricted stock units (RSUs) to employees and executives under an equity incentive plan; vesting and acceleration of equity incentives; filing Section 83(b) elections; and Section 409A compliance. This Note also discusses certain steps startups should take to protect their intellectual property (IP) and goodwill, such as ensuring that founders sign technology assignment agreements (TAAs) and employees sign proprietary information and invention assignments (PIIAs).

Startup Company Offer Letters, Employment Agreements, and Equity Compensation

Practical Law Practice Note w-017-2195 (Approx. 34 pages)

Startup Company Offer Letters, Employment Agreements, and Equity Compensation

by Practical Law Employee Benefits & Executive Compensation, Practical Law Labor & Employment, and Practical Law Corporate & Securities
MaintainedUSA (National/Federal)
A Practice Note addressing the key issues that startup companies should consider when entering into employment-related agreements (such as offer letters or employment agreements) with founders, employees, and executives at various stages of a startup's lifecycle. This Note covers equity compensation issues, including issuing restricted stock to founders and employees; granting stock options, such as incentive stock options (ISOs), non-qualified or non-statutory stock options (NSOs), or restricted stock units (RSUs) to employees and executives under an equity incentive plan; vesting and acceleration of equity incentives; filing Section 83(b) elections; and Section 409A compliance. This Note also discusses certain steps startups should take to protect their intellectual property (IP) and goodwill, such as ensuring that founders sign technology assignment agreements (TAAs) and employees sign proprietary information and invention assignments (PIIAs).