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ESOP Readiness Assessment

Ten questions on whether your employee stock option scheme is actually structured properly.

Version: v1.0 Last Reviewed: 27 July 2026 Scope: General guidance for Indian private companies; not jurisdiction-specific
Please note: This tool provides general educational information only, based on your own answers. It does not review your actual documents or facts, does not constitute legal advice, and does not create an advocate-client relationship. For guidance specific to your business, please book a consultation.
1. Does your company have a board-approved employee stock option scheme (ESOP pool)?
2. Is the ESOP pool size clearly defined as a percentage of fully diluted equity?
3. Do you have a written ESOP policy covering vesting schedule, cliff period, and exercise price?
4. Is there a standard option grant letter or agreement used consistently for every grantee?
5. Have you defined what happens to vested and unvested options on termination (good leaver / bad leaver treatment)?
6. Is there a documented process for board approval of each individual option grant?
7. Have the tax implications of exercising options been explained to employees in writing?
8. Is your ESOP scheme structured consistently with the Companies Act requirements applicable to your company type?
9. Do you maintain an up-to-date register of options granted, vested, exercised, and lapsed?
10. Has your ESOP scheme been reviewed by counsel within the last 12 to 18 months?

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