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ESOP Grant Letter

Granting stock options to an employee? Issue a clear ESOP grant letter — options, exercise price, vesting and cliff. Generate a free draft.

What is a ESOP Grant Letter?

An ESOP Grant Letter is the document you give an employee when you grant them stock options under your ESOP scheme — stating how many options, at what exercise price, and the vesting schedule (commonly over four years with a one-year cliff). It sits under your board-approved ESOP plan.

Note: you need an approved ESOP scheme first — the grant letter operationalises it for each employee. We can set up the scheme too.

Key clauses it should cover

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ESOP Grant Letter

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Important: This is an auto-generated draft template for reference only — not legal advice. Laws and your specific situation vary. Please have it reviewed by a qualified professional before signing. Get this agreement professionally drafted & vetted →
FAQs

Common questions

Yes — the grant letter operates under a board- and shareholder-approved ESOP scheme/plan. If you don’t have one yet, we can set it up (see ESOP Scheme Setup).

A cliff (commonly one year) means no options vest until the employee completes that initial period; after the cliff, options vest gradually per the schedule. It protects the company from early leavers.

Often a low nominal price (or as advised for tax/valuation reasons). The right price depends on your cap table and valuation — we can advise.

Typically unvested options lapse, and vested options may be exercised within a window per the Plan. The specifics are set by your ESOP plan.

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