This article contains a general summary of deed execution and is not a complete or definitive statement of the law. SeedLegals is not a law firm and is not permitted to provide legal, tax or financial advice. You should make your own judgement on the suitability of any articles or documents to your circumstances, and obtain your own qualified advice as you see fit.
In this article, we will show you, step-by-step, how an Irish Option Grant agreement is signed by an employee and a company on the SeedLegals platform. We will also outline how a company’s common seal is physically added (or ‘affixed’) to the document once it’s been signed.
As a reminder, an Option Grant is a legal agreement which outlines the number of options to be awarded, and needs to be signed and sealed (with the company’s seal) by the company, and signed by the employee (with the employee’s signature being witnessed by an independent witness).
Finding, Generating and Sharing the Option Grant Agreement
1. To get to an Option Grant agreement, head to the share options tab on the platform and click on Option Holders. Select the relevant option holder. Scroll down to the bottom of the page and you will see the Option Grant (aka the Option Agreement). Click on the pencil symbol (circled in red below).
2. A question with two choices will then appear - you should read the accompanying hint text, choose who will sign the Option Grant on behalf of the company (it will either be one or two directors) and then click ‘Done’.
Remember, you can only select the ‘one director will sign’ option if the company’s constitution specifically allows for deeds to be signed by only one director (please see the second image below for an example of the type wording in an Irish company’s constitution which allows for this). Otherwise two directors must sign the agreement.
An example of a typical regulation in an Irish company’s constitution allowing only one director to sign a deed on behalf of the company:
3. Once you have generated and read through the Option Grant agreement, click the share button (which is the icon circled in red below). You will then be able to share the document with the employee who is receiving options.
Guide to the Employee Signing the Option Grant Agreement4. The employee will then receive an email with a link to the Option Grant agreement. After logging onto the SeedLegals platform, they can then review the agreement and, if happy with the terms, click the sign button to e-sign the document. Please note that the employee must sign in the presence of an independent witness (see step 5).
Also, remember that legally, the independent witness is meant to:
a) physically see the signatory, i.e. the employee, sign the document, and
b) not be an 'interested party' to the transaction themselves.
Not being an interested party means the witness should not benefit themselves one way or the other from the outcome of the agreement.
- For example, another employee of the company should not be a witness for the other party, because if there's a dispute later the other party could look to exploit the fact that the witness was connected to the company and not independent.
- For the same reason a family member shouldn't be the witness for the employee’s signature, since they're an interested party by family ties.
First, the employee clicks ‘Set witness details’.
Then the employee inputs the witness’s details and presses ‘Save’.
The following message will then appear. The employee should click on the copy to clipboard link. This is the icon circled in red below.
The employee should then paste this link into an email and send it to the witness. The witness should immediately click on the link which will take them to the below page which will allow them to e-sign (please note that they don’t need to have a SeedLegals account to do this).
Once they have signed, they can close the tab, and their signature will automatically pull through onto the agreement.
After both these steps are completed, the employee will have signed the Option Grant agreement - and it should look something like this:
Guide to the Company Signing and Sealing the Option Grant Agreement
6. After the employee has e-signed the Option Grant, you should then print the agreement in full, twice - this will mean that once the company signs both hard copies, there will be an original for the company’s records, and for the employee.
Assuming that two directors are signing the Option Grant agreement on behalf of the company, each director should then sign each of the two printed hard copies of the document - their signatures should be in pen above one of the signature areas (see the red text below as a guide) and they should also handwrite ‘Director’ immediately below where they have signed (see the green text below).
Remember, only one director signature is required if you chose the ‘one director signing’ option at step two.
7. After the directors have signed, the company’s common seal then needs to be added (or ‘affixed’) to each of the two copies of the agreement. The seal is used to imprint the company’s name on important legal documents. Your company should already have a seal (every Irish company is required to have one by law), but if you haven’t got one yet just get in touch with a local seal maker (e.g. McGrath Seals, Dublin - https://mcgrathseals.ie/product/seals/) to have one made.
Following this, one of the two directors who signed both copies of the Option Grant agreement should apply the seal to the signature page of both copies of the document on the area outlined by the purple circle below.
The seal’s imprint on the pages will look something like this, except it will be your company’s name that will be embossed:
8. After steps 6. and 7. are complete, the company part of the signature page of the agreement should look like this:
9. You should now click on the signing icon (circled in red below) on the platform:
And then select that the agreement has been signed offline by each of the two directors by clicking the button circled in red for each director:
Once this step is complete, the version of the Option Grant agreement on the platform should look like this:
10. Now that the Option Grant has been signed by the relevant parties, make sure to click the ‘Approve option grant’ button and then have two directors print off, sign and seal the option grant certificate:
11. Finally, don’t forget to hand or post your employee one of the two original fully signed hard copy Option Grant agreements, and to store the other copy for safe keeping with the company’s books and records. While you are now able to manage the options on the SeedLegals platform, it’s still good practice for both the company and the employee to each hold an original of the Option Grant agreement.