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Stephan Meyer, Startup Financing & VC @LEXR Germany
An ESOP (Employee Stock Option Plan) allows employees to participate in the company’s growth through real shares or options. These options typically convert to shares when the startup is sold (exit) or goes public (IPO).
A VSOP (Virtual Stock Option Plan) gives employees virtual shares, serving as a calculation factor. In the event of an exit or IPO, employees receive financial benefits similar to owning real shares, but without actual ownership. VSOPs offer more flexibility and can avoid the tax and formal challenges of ESOPs in Germany.
These plans link employee rewards to company performance, motivating employees to drive business success.
Both ESOP and VSOP plans can be customized to meet your company’s specific goals and employee roles, offering flexible and effective incentive structures
This flat fee package includes:
Expert meeting with our legal experts: strategic planning and advice, discussion of core variables, decision on the most suitable plan
Drafting of the legal documents including the allocation agreement
Feedback round, to clarify all open issues and implement the adjustments
Review of existing legal documents related to the plan
Guidance for the plan management
This flat fee package includes:
Expert meeting with our legal experts: strategic planning and advice, discussion of core variables, decision for the most suitable plan
Drafting of the legal documents including the allocation agreement
Feedback round to clarify all open issues and implement the adjustments
Review of existing legal documents related to the plan
Guidance for the plan management
This flat fee package includes:
Kick-off session with our legal experts, the advisory board and the management team
Preparation of the employee workshop according to the management input
Implementation of the workshop with the company's employees
Training concept & manual for future internal employee workshops
Enjoy peace of mind with our flat fee packages. Our transparent pricing helps you plan your budget without unexpected costs, ensuring financial clarity and predictability.
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The allocation of genuine shares or options on such shares to an employee generally results in a so-called non-cash benefit. This is treated in the same way as wages for tax and social security purposes. This leads to the so-called “dry-income problem”, as employees have to pay tax on sums of money that they have not yet received in cash. Although special tax regulations exist to prevent taxation at the time of allocation, the applicability of these regulations is highly dependent on the individual case.
To ensure that the tax and social security implications of stock options can be planned for both the employee and the company, we recommend obtaining information from the tax office at the place of business.
Together with the ESOP, we offer to obtain a call report at cost (costs generally between EUR 650 and 1,600).
Consulting on or changes to an existing VSOP / ESOP
Consulting on the international rollout of a VSOP / ESOP
Implementation of an international VSOP / ESOP for German employees
Other participation options for employees (direct shareholdings, dormant shareholdings, establishment of employee investment companies)