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1
Employee Stock Bonus Plan & Agreement
Employee Stock Bonus Plan and Agreement are documents used in a specific type of employee
incentive special compensation program. This program is designed to allow key employees to
purchase stock from their corporate employer at a discount of not less than 85% of the fair market
value of the stock. The employees also get a tax break when they sell the stock in the future.
This type of employee incentive program is used to attract and keep talented employees. You
should use an Employee Stock Bonus Plan and Agreement when you want to provide an incentive
compensation plan and this type of program meets your tax needs.
There are many requirements to consider when establishing any type of employee incentive
compensation plan. You should consult with your attorney, your accountant, or a benefits consultant
if you are contemplating some type of employee incentive compensation plan. Use this agreement
to get a general understanding of how an Employee Stock Bonus Plan works.
There are different tax consequences to the employer and employee depending upon the type of
incentive compensation plan you use. When you consult you lawyer, accountant or benefits
consultant, you should ask for a clear explanation of the types of plans and their consequences.
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2
Employee Stock Bonus Plan & Agreement
The first part of the Memorandum should be completed and distributed to the Board of Directors
along with a copy of the Employee Stock Bonus Plan and Agreement.
Date:
[Month, Day, Year]
To:
[Name of Director]
From:
[Owner/Founder]
[Company]
Subject:
Employee Stock Bonus Plan and Agreement
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Attached is an Employee Stock Bonus Plan and Agreemen to provide incentive bas