Questions

New C-Corp single founder, what is the correct process to grant a non employee consultant equity properly?

Leveraging Clerky and can utilize a consultant agreement from there so I'm comfortable with that...just needing some quick education of proper process granting of this first equity. Also familiar with tracking on the cap table. Thanks

1answers

Hi there,

I did this in my last company. If you are a c-Corp then you can issue traditional shares to consultants. For other forms such as LLC or s-Corp it’s much more complex. So assuming you are a c-Corp, then you need a legal document called an option plan that reserves the shares for options and outlines how options are managed. Then you need an agreement called an option award agreement which you would sign with each person to whom you want to grant options. There are some issues to consider but that is the broad strokes.


Answered 9 months ago

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