Create an incentive plan
You create a plan from "Incentive Plans" ("Plans list" menu) with "Add Plan": the plan type, the name, the start date, the plan's shares (pool), the price per unit, which is the exercise price, and the vesting schedule (cliff, vesting and speed). You can create it as a draft and ask Sttok to generate the conditions for each beneficiary.
Before you start
- The plan's rules or conditions, approved by whoever is responsible in the company.
- The plan's figures: type, number of shares, exercise price, start date and vesting schedule.
How to do it#
- Open the new plan form. In the Incentive Plans menu, go to "Plans list". On the "Incentive Plans" screen, click "Add Plan". The "Add Stock / Phantoms Plan" dialog opens.
- Choose the type. In "Select the Plan type", Stock Options or Phantoms. A plan has only one type.
- Decide whether to create it as a draft. Tick "Create plan as draft" if you are still preparing it: it is saved without being active.
- Fill in "Name" and "Plan start date". A name that says which plan it is, not just the year, and the date from which it applies.
- Enter the "Plan shares (pool)". It is the number of units that can be granted under this plan. Below, "Available pool" tells you how many are left. With the switch you choose whether the plan is measured on the issued shares ("Non diluted") or on the fully diluted share capital ("Fully diluted").
- Enter the "Price per Unit (exercise price)". It is what is deducted from the value of each unit when it is sold. With the switch you choose whether it is a "Fixed price" or a "Unit price".
- Decide whether there are tiers by category. Tick "Include tiers by job category" if the plan gives different conditions depending on each person's category.
- Set the vesting schedule. In "Cliff", the waiting period, or "No Cliff". In "Vesting: Vesting period", how long it takes for everything to vest, or "No vesting". In "Vesting speed", how often a new tranche vests, for example "Daily".
- Adjust the vesting options. Three checkboxes: the one that vests accumulated decimals, "Vesting will take place at the end of the month" and "Customize the vesting percentages for each tranche", if the tranches are not equal.
- Attach the deed, if there is one. In "Add deed (optional)".
- Answer "Do all shareholders dilute?". Yes or No, according to what the plan resolution says.
- Decide whether Sttok generates the conditions. In "Generate Conditions Template", choose "Yes" for Sttok to prepare each beneficiary's conditions document and manage its acceptance. You set up the template in the next step.
- Click "Add Plan".
The schedule is calculated automatically. From the cliff, the vesting and the speed, Sttok works out for each beneficiary which units vest and on what date, starting from their grant date. That is why a mistake in these figures is repeated in every grant under the plan.
Change a plan#
From the plan, "Update plan" opens the same dialog. You can change the "Name" and the "Plan shares (pool)", which is how you increase or reduce the number of units in the plan. The type, the start date and the exercise price cannot be changed. Save with "Update".
What happens next#
- The plan appears in "Incentive Plans", with its type, status, start date, price per unit, vesting and its granted units out of the total. If you created it as a draft, its status is "Draft": you find it with "Filter: Statuses".
- You can now grant units to beneficiaries. If you chose "Generate Conditions Template", each grant comes with its conditions for the beneficiary to accept: this is their invitation letter.
- The plan's units count towards the incentive pool.
Frequently asked questions#
I got the exercise price wrong. Can I change it?
Not from "Update plan": the price, the type and the start date are fixed when the plan is created. If the plan has no grants yet, the cleanest option is to create a new one with the correct price.
What happens if I change the conditions of a plan that has beneficiaries?
The conditions each beneficiary accepted are the ones that apply to them. If someone's conditions need changing, they are changed in their grant with "Edit conditions", and it is advisable to sign a new document.
What is creating it as a draft for?
To prepare the plan calmly, for example while the rules are being approved, without it counting as active yet.
Related
- What an incentive plan is An incentive plan is how Sociedad Ejemplo, S.A. shares with its team part of the value it creates: it grants you units that become yours over time and that turn into money when the company opens a liquidity window.
- The pool and the resolutions that change it The pool is the total number of units the company has reserved for its incentive plans. It is approved by the general meeting, grows or shrinks with new resolutions, and is split into units granted to beneficiaries and units available to grant.
- Grant units to a beneficiary Granting means giving a person a number of units of a plan, with "Add Beneficiary" in "Incentive Plans", which opens the "Add Beneficiary to the incentive plan" dialog: the beneficiary, the plan, the grant date, the units and the invitation date. The grant inherits the plan's conditions, unless you change them for that person, and Sttok can send them the invitation letter to sign.
- The invitation letter The invitation letter is the document in which the company offers you units of an incentive plan: it states how many, from which plan, on what conditions and with what schedule. When you accept and sign it, the grant becomes final.