Can a share option agreement be signed electronically?

Yes. Electronic signatures are legally enforceable in the United States under the ESIGN Act (15 U.S.C. §7001) and UETA in most states, provided the parties consent and records are retained. Exceptions such as certain court filings or testamentary documents may not be eligible.

Is notarization required for option agreements?

Not generally required for a typical private option agreement, but some states or corporate bylaws may require notarization for transfer documents or for third-party proof. Check state-specific rules when recording or transferring underlying shares.

When should a grantee file an 83(b) election?

An 83(b) election must be filed with the IRS within 30 days of the grant to accelerate taxation on the grant date. Failure to file timely can change tax outcomes; consult a tax advisor for consequences.

How do I correct a completed template with errors?

Prepare an amendment or corrective agreement executed by all original parties. Document board approval if required and update the equity ledger. Avoid unilateral handwritten changes to executed agreements.

What records should be retained and for how long?

Retain executed agreements for the term plus at least 3 years; keep tax and corporate records per IRC §6501(a) and applicable state rules. Industry regulations like HIPAA may require longer retention.

How do I revoke or cancel an unexercised option?

Revocation or cancellation must follow the agreement’s termination provisions and any board-authorized amendment. Notify the grantee in writing and document the corporate action in board minutes to avoid disputes.

Electronic Signature
Templates
Legal
Share Option Agreement Template

Share Option Agreement Template

This template is fully customizable. Edit the text, fill out the fields, and send it for signature. Give it a try!

SHARE OPTION AGREEMENT

This Share Option Agreement (the Agreement) is made as of between Company Name: a corporation organized under the laws of with principal offices at (the Company), and Optionee Name: (the Optionee).

RECITALS

WHEREAS, the Company desires to grant to the Optionee an option to purchase shares of the Company’s common stock, subject to the terms and conditions set forth in this Agreement; and

WHEREAS, the grant is intended to provide the Optionee with an opportunity to acquire a proprietary interest in the Company and to align the Optionee’s interests with those of the Company’s shareholders; and

WHEREAS, the Board of Directors (or committee duly authorized by the Board) has authorized the grant of the option on the terms contained in this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the parties agree as follows:

1. DEFINITIONS

For purposes of this Agreement, the following terms shall have the meanings set forth below:

(a) "Option" means the right granted pursuant to Section 2 to purchase the number of shares specified in this Agreement.

(b) "Option Shares" means shares of the Company’s common stock, par value per share as applicable.

2. GRANT OF OPTION

Subject to the terms of this Agreement and the Company’s governing equity plan (the Plan), if any, the Company hereby grants to the Optionee an option (the Option) to purchase the Option Shares at the per-share exercise price set forth in Section 3. The Option is non-qualified unless otherwise specified in a separate writing signed by both parties.

3. EXERCISE PRICE AND PAYMENT

The exercise price per share for the Option shall be (the Exercise Price). Payment of the Exercise Price shall be made in cash, certified check, wire transfer or other consideration approved by the Board, and any payment method shall be subject to the Company’s right to require reasonable documentary evidence of good funds.

4. VESTING

The Option shall vest according to the following schedule: Vesting Commencement Date: . Vesting schedule:

Vesting Schedule and Conditions

Vesting shall cease upon the Optionee’s termination of service for any reason, subject to any acceleration provisions expressly set forth in this Agreement or an attached schedule.

5. TERM AND EXPIRATION

The Option shall expire and no longer be exercisable upon the earliest of: (a) the date ; (b) termination as provided in Section 7; or (c) upon lapse of the option term which shall be years from the Grant Date unless otherwise extended by the Board.

6. EXERCISE PROCEDURES

To exercise the Option in whole or in part, the Optionee must deliver to the Company (a) written notice of exercise specifying the number of Option Shares to be purchased; (b) payment of the aggregate Exercise Price; and (c) such representations, warranties and documentation as the Company may reasonably require. The notice shall be sent to:

Company Exercise Notice Address

7. TERMINATION; FORFEITURE

In the event the Optionee’s service with the Company terminates for Cause (as defined below), all unvested portions of the Option shall be forfeited immediately upon termination. For purposes of this Agreement, "Cause" shall mean: (i) willful and continued failure by the Optionee to substantially perform assigned duties after written notice and a reasonable opportunity to cure; (ii) conviction of a felony involving moral turpitude; or (iii) material breach of a material Company policy that is not cured within thirty (30) days after written notice.

If the Optionee’s service terminates by reason of death or Disability (as defined below), the vested portion of the Option may be exercisable for a period of months following termination, unless a shorter period is required by applicable law or the Plan.

8. TRANSFERABILITY

The Option shall not be transferable except by will or the laws of descent and distribution, and during the lifetime of the Optionee may be exercised only by the Optionee. Any attempted transfer in contravention of this Section shall be null and void.

9. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION

In the event of any change in the Company’s capital structure by reason of recapitalization, split-up, stock dividend, combination of shares, reclassification, merger, consolidation or sale of substantially all assets, appropriate equitable adjustments shall be made to the number and kind of Option Shares and the Exercise Price so as to preserve the economic intent of the parties.

10. REPRESENTATIONS AND WARRANTIES

The Optionee represents and warrants that the Optionee has received all information the Optionee considers necessary in connection with the grant of the Option and that the Optionee is acquiring the Option for the Optionee’s own account for investment and not with a view to resale or distribution, except as expressly permitted by this Agreement.

Additional Representations or Limitations

11. TAX MATTERS; WITHHOLDING

The Company shall have the right to deduct or require payment of any federal, state or local taxes required by law to be withheld in connection with the exercise of the Option and the issuance of Option Shares. The Optionee shall be liable for any tax consequences arising from the grant or exercise of the Option and agrees to cooperate with the Company in satisfying withholding obligations.

12. CONFIDENTIALITY

The Optionee agrees to hold in confidence and not to disclose to any third party any non-public information concerning the Company obtained by reason of the Optionee’s relationship with the Company, except as required by law or with the Company’s prior written consent.

13. NOTICES

All notices, requests, consents and other communications required or permitted under this Agreement shall be in writing and shall be deemed given when delivered personally, by certified mail (postage prepaid, return receipt requested), or by overnight courier to the addresses set forth below or to such other address as a party may designate by notice to the other party.

Company Notices Address Optionee Notices Address

14. AMENDMENTS; WAIVER

No amendment or waiver of any provision of this Agreement shall be effective unless in writing and signed by both the Company and the Optionee. No failure or delay by either party in exercising any right shall operate as a waiver of that right.

15. COUNTERPARTS

This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, and all of which shall together constitute one and the same instrument. Signatures delivered by electronic transmission shall be deemed original signatures.

16. GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the State of , without regard to principles of conflicts of law.

17. ENTIRE AGREEMENT; SEVERABILITY

This Agreement, together with any schedules, exhibits and the Plan if applicable, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior agreements and understandings. If any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired.

18. MISCELLANEOUS

The headings in this Agreement are for convenience of reference only and shall not affect the interpretation of the Agreement. Any obligation or liability of the Company hereunder is subject to the Company’s corporate governance documents and any limitations contained therein.

Additional Terms or Notes

Company Name:

By:

Date:

Optionee Name:

By:

Date:

What a Share Option Agreement Template Is and When It Applies

A Share Option Agreement Template is a standardized legal document used to grant the right to purchase company shares at a specified price and under defined conditions. It captures the grant date, vesting schedule, exercise price, exercise period, applicable conditions (forfeiture, change of control), and any transfer restrictions. Companies use the template to create consistent option grants for employees, consultants, and directors, and to document shareholder or board approvals. The template reduces drafting time and helps ensure enforceable terms are captured for corporate records and equity administration.

Why a Solid Template Matters for Equity Grants

A complete template ensures predictable economics, supports compliance with tax and securities rules, and creates a clear record for corporate governance. It streamlines review, reduces drafting errors, and helps protect issuer and recipient rights by documenting vesting, exercise mechanics, and post-termination treatment.

Who Typically Prepares and Signs These Agreements

Use the template as a starting point, then adapt it for company-specific governance, board resolutions, and any applicable securities or tax filings.

Founders and executives using option grants to motivate key hires and conserve cash while aligning incentives.
In-house counsel and external corporate attorneys reviewing terms for securities law and tax compliance.
HR and equity administrators preparing standardized grants for multiple recipients and maintaining award records.

Typical Signatories and Their Roles

Chief Executive Officer

The CEO commonly signs to accept or acknowledge grants on behalf of management or to execute board-approved awards. Their signature confirms company consent, operational acceptance, and that grant terms align with board resolutions and equity plans.

Company Secretary

The company secretary or authorized corporate officer signs after verifying corporate authority and recording the grant in company minute books. They ensure vesting tables and board approvals are properly documented for corporate governance and audit trails.

Essential Clauses to Include in a Professional Template

A robust template groups fundamental deal terms, governance references, and remedial provisions so each grant is clear and enforceable.

Grant definition

Specify number of options, class of shares, grant date, and exercise price; tie the grant to the equity plan under which it is issued to avoid ambiguity and ensure plan compliance.

Vesting schedule

Describe cliff periods, graded vesting, acceleration events, and treatment on termination or change of control so recipients understand when economic rights vest.

Exercise mechanics

Set the exercise window, payment methods, tax withholding obligations, and any cashless exercise procedures to prevent operational disputes at exercise.

Transfer restrictions

Include limitations on assignment, rights of first refusal, and legend requirements to preserve securities law compliance and company control over share transfers.

Termination and forfeiture

Define what happens on termination for cause, resignation, disability or death, and whether unvested options are forfeited or accelerated.

Governing law and dispute resolution

Identify the governing state law, forum selection, and whether arbitration applies, to reduce uncertainty and coordinate with corporate charter provisions.

Step-by-Step: Complete and Execute a Share Option Agreement

Follow these sequential steps to prepare, approve, and sign a template-based option grant with clear corporate documentation.

01

Prepare draft: Populate the template with grantee name, number of options, price, and vesting.
02

Board approval: Obtain board or committee authorization and record the resolution in minutes.
03

Recipient review: Send the draft to the grantee for review and confirm understanding of terms.
04

Execute and record: Collect signatures, file the executed agreement in corporate records, and update the equity ledger.

How to Configure an Online Signing Workflow

Set up a routine workflow to reduce manual steps when issuing multiple option agreements.

Field	Configuration
Signer order	Set company signers first, then grantee
Authentication	Require email and optional SMS code
Template locking	Lock legal clauses; allow fillable fields only
Archive	Auto-save executed PDF to secure folder

Digital Signing and File Format Considerations

Confirm the provider supports ESIGN/UETA compliance, AES-256 at-rest encryption, and the export formats your legal and equity-administration teams require.

File formats: PDF and DOCX supported
Authentication: Email plus optional MFA
Audit trail: Timestamps and IP logging

Typical eSubmission Flow for Option Agreements

Online execution simplifies distribution, signature capture, and recordkeeping when each step is defined and automated.

Upload document: Add the finalized template to the signing platform.
Place fields: Insert signature, date, and vesting fields for each party.
Send to signers: Dispatch in the authorized order with authentication.
Store executed copy: Save PDF with audit trail to the equity ledger.

Key Timing and Tax Deadlines to Watch

Certain timing decisions affect tax treatment, reporting obligations, and exercise windows; track these dates carefully.

83(b) election deadline:

File within 30 days of grant for taxable property elections.

Form 1099 reporting:

Report nonstatutory option income per IRS timing when exercises create taxable events.

Grant documentation:

Record grant and board approval in minutes promptly after execution.

Exercise windows:

Note expiration of options and post-termination exercise periods.

State filings:

Allow time for any required state securities or franchise filings.

Common Preparation Pitfalls to Avoid

Using informal or inconsistent option descriptions that contradict the equity plan and confuse stock ledger entries.
Failing to obtain or document board approval and resolutions authorizing the specific grant and quantity of options.
Incorrectly entering grantee names or exercise prices, resulting in invalid exercises or tax mismatches at reporting time.
Neglecting to include transfer restrictions or legend language required by securities or shareholder agreements.

Consequences of Inaccurate or Missing Information

Tax treatment: Missed 83(b) elections can increase taxable income.

Reporting penalties: Incorrect forms may trigger IRS penalties under IRC §6721.

Enforceability: Ambiguous terms risk contract disputes.

Securities compliance: Improper issuance may breach state or federal rules.

Recordkeeping failures: Missing ledger entries complicate audits.

Third-party risk: Investors may challenge undocumented dilution.

Comparing eSignature Options for Executing Option Agreements (signNow First)

Compare starting price, trial availability, bulk-send capability, audit trail, HIPAA support, and envelope limits when selecting an eSignature provider.

	signNow	DocuSign	Adobe Sign	PandaDoc	HelloSign
Starting Price	$8/user/mo	$15/user/mo	$14/user/mo	$19/user/mo	$15/user/mo
Free Trial	7‑day free trial	Varies by plan	Varies by plan	Varies by plan	Varies by plan
Bulk Send	Yes	Yes	Yes	Yes	Varies by plan
Audit Trail	Yes	Yes	Yes	Yes	Yes
HIPAA Compliant	Yes	Yes	Yes	No	No
Envelope Cap	No cap	100 envelopes/user/year	Varies by plan	Varies by plan	Varies by plan

Illustrative Examples of Template Use

Real organizations use standardized templates to accelerate grants while preserving control and compliance.

Optica Ventures — COO

The interface is simple and easy-to-use for our team; more importantly, it is just as easy for our customers.

Reduced turnaround time substantially.
The standard template ensured consistent board approvals and accurate stock ledger updates across multiple grant rounds, reducing reconciliation work.

Martin Properties — Founder

I can process and execute all of these documents online with 100% compliance and built-in security.

Mobile signing enabled faster acceptance.
Centralized templates and digital records allowed the company to issue advisor grants promptly and maintain complete executed files for audits.

Who Has Authority to Sign a Grant

Board Chair

Typically authorized by board resolution to approve and sign grants on behalf of the board. The chair’s signature demonstrates corporate authorization and should be supported by meeting minutes or a written resolution.

General Counsel

Often signs or certifies that the agreement complies with corporate governance and securities requirements. Counsel also confirms that legend language and transfer restrictions meet legal obligations.

Frequently Asked Questions About the Share Option Agreement Template

Answers to common questions about execution, tax elections, eSign validity, and post-execution recordkeeping for option agreements.

Need help? Contact support

Can a share option agreement be signed electronically?
Yes. Electronic signatures are legally enforceable in the United States under the ESIGN Act (15 U.S.C. §7001) and UETA in most states, provided the parties consent and records are retained. Exceptions such as certain court filings or testamentary documents may not be eligible.
Is notarization required for option agreements?
Not generally required for a typical private option agreement, but some states or corporate bylaws may require notarization for transfer documents or for third-party proof. Check state-specific rules when recording or transferring underlying shares.
When should a grantee file an 83(b) election?
An 83(b) election must be filed with the IRS within 30 days of the grant to accelerate taxation on the grant date. Failure to file timely can change tax outcomes; consult a tax advisor for consequences.
How do I correct a completed template with errors?
Prepare an amendment or corrective agreement executed by all original parties. Document board approval if required and update the equity ledger. Avoid unilateral handwritten changes to executed agreements.
What records should be retained and for how long?
Retain executed agreements for the term plus at least 3 years; keep tax and corporate records per IRC §6501(a) and applicable state rules. Industry regulations like HIPAA may require longer retention.
How do I revoke or cancel an unexercised option?
Revocation or cancellation must follow the agreement’s termination provisions and any board-authorized amendment. Notify the grantee in writing and document the corporate action in board minutes to avoid disputes.

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