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Investment & Share Option Agreements

Share Option Agreement Templates

A Share Option Agreement is a contract that gives a person (often an employee, investor, or founder - "Grantee") the right, but not the obligation, to buy or sell shares in a company at a future date, under specified terms such as at an agreed price.

These agreements provide a financial benefit to the Grantee where the share price rises over the period the option is available. The selection of templates within this collection are categorised as follows:

Standard Share Option Agreements: 

These are alternative forms of the option grant agreement, tailored to different business circumstances.

Share Option Agreement - Exercise Within Agreed Period - Basic form where an individual may exercise the option within a defined time window. Common for employee or founder options.

Share Option Agreement - Exercise On Conversion Date - Used where the option is triggered by a conversion event (shares listed or new shares issued). Useful in investment or reorganisation contexts.

Share Option Agreement – Call Option - Gives a buyer (the “option holder”/Grantee) the right to buy shares at a future date or event.

Share Option Agreement – Put Option - Gives a seller (the “option holder”/Grantee) the right to sell shares at a future date or event.

EMI Scheme Templates:

The EMI (Enterprise Management Incentive) Scheme is a UK government-approved share option scheme designed to help smaller, high-growth companies attract, retain, and motivate key employees.

Share Option Agreement - EMI Scheme - Used to grant EMI options to employees.

Notice of Exercise of Option – EMI Scheme - Notice the option holder gives when they want to exercise their EMI options.

Shareholders’ Ordinary Resolution – EMI Scheme - Shareholders formally approve the adoption of the EMI scheme and/or the grant of options.

Board Minutes – EMI Scheme - Board meeting record approving the EMI scheme and specific grants.

Share Option Exercise Notices:

Notice of Exercise of Option(s) - Used to exercise options in conjunction with a standard share option (not EMI or "on conversion date").

Notice of Exercise of Option on Conversion Date - Used to exercise options when triggered by a share conversion event.

These notices should be applied with the relevant Share Option Agreement above.

Termination of Share Option(s):

Share Option Deed of Surrender - Used when the option holder agrees to cancel or surrender their option rights (e.g., when leaving the company).

Why Subscribe to Simply-Docs?

All Simply-Docs templates are drafted by qualified, experiences solicitors and kept up to date with UK company law and HMRC requirements (including EMI rules).
This ensures:

  • Clear, enforceable legal wording.
  • Compliance with the Companies Act 2006 and HMRC guidance (for EMI options).
  • Reduced risk of invalid or incomplete option grants.

The templates are designed to give practical, affordable structure to what would otherwise be complex and expensive legal work. Save time and manage cost efficiency with ready-to-use and editable in Word templates. Unlimited downloads to all documents within Corporate ensure affordability and value.

Includes free Document Storage and e-Sign.

Full choice of Share Option Agreements are listed below:

Share Option Agreement Templates is part of Corporate. Just £38.50 + VAT provides unlimited downloads from Corporate for 1 year.

Frequently Asked Questions

Which form of share option agreement do we need? +
Match the trigger to the situation. Exercise within an agreed period suits employee or founder options with a simple time window. Exercise on a conversion event fits investment or reorganisation deals where the option should only bite if shares are listed or new shares issued. A call option lets one party require the other to sell; a put option lets a holder require a purchase. Identify who must be able to force what, and when, and the right template follows.
Are these the same as EMI options for our employees? +
No. These are non tax-advantaged option agreements: flexible, quick and open to anyone, but without special tax treatment, so employees are generally taxed when they exercise. EMI is HMRC's tax-advantaged scheme with qualifying conditions, notification requirements and significant reliefs, and its company eligibility limits were expanded substantially from 6 April 2026. If your goal is tax-efficient employee incentives, take advice on EMI before defaulting to an unapproved option.
What exercise price should we set in the option agreement? +
Commercially, whatever the deal requires: a fixed price today, a formula or market value at exercise. Legally the price must at least cover the nominal value of the shares when issued. Be aware the choice has tax consequences, particularly for employees, where a discount to market value generally increases the income tax bill at exercise. The templates take the price as a commercial input and leave the tax analysis to your advisers, deliberately.
What happens to an option if the holder leaves the company before exercising? +
Whatever the agreement says, which is why leaver terms deserve more attention than any other clause. Decide whether the option lapses on departure, survives for a short window or is treated differently for good and bad leavers, and say so expressly. Silence means the option may survive departure, leaving an outsider holding rights over your equity. The templates include exercise windows and lapse provisions to adapt to your leaver policy.
Do options dilute our existing shareholders when we grant them? +
Not at grant: no shares exist until exercise, so voting and dividends are untouched. Dilution lands at exercise, and two things must be ready then: directors' authority to allot the shares and a route through pre-emption rights, ideally secured when the option is granted rather than hunted for years later. Tell existing shareholders about significant option grants anyway; surprise dilution poisons small companies. The agreements here prompt the authority check at grant.
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