Stock Option (Statutory Share Option) Agreement Advisory — IT Startup in South Korea
Case Overview
- Client Information
- Corporate / Business Entity
- Case Details
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The Corporate Practice Group at Decent Law Firm (Seoul, Korea) represented an IT startup in advising on the full process of granting statutory share options (stock options) to three full-time employees, including the design of required corporate procedures under Korean commercial law and the drafting of the relevant agreements.
The client sought to grant stock options as a means of attracting and retaining key talent, but needed practical guidance on how to satisfy the legal requirements under Korean law — including shareholder meeting resolutions, articles of incorporation review, and registration procedures.
Decent Law Firm's Corporate Practice Group conducted a thorough review of the required procedures under the Korean Commercial Act and delivered a ready-to-use stock option agreement tailored to the client's circumstances.
Decent's Strategy
The team confirmed whether the client qualified for the small company exemption under the Korean Commercial Act, and mapped out the applicable shareholder meeting format and resolution requirements.
A step-by-step procedural guideline was provided — covering everything from convening the shareholder meeting, preparing the minutes, executing the agreements, and handling the registration filing — so the client could move forward with confidence at every stage.
2. Shareholder Meeting Minutes and Document Package
The team identified all matters required to be included in the shareholder resolution and prepared a ready-to-use extraordinary general meeting (EGM) minutes template for the client's immediate use.
3. Vesting Structure Design and Agreement Drafting
The team designed a practical incentive structure covering service requirements, vesting schedule, exercise period, and treatment upon resignation.
All terms were carefully aligned across both the shareholder meeting minutes and the stock option agreement to ensure consistency and to minimize the risk of future disputes.
Results & Significance
Through this engagement, the client successfully completed the stock option grant process in full compliance with Korean commercial law and was able to execute agreements with key employees on a stable legal footing.
Stock options are a powerful tool for talent retention in startups — but in South Korea, a procedural misstep can render the entire grant legally void.
This is not simply a matter of drafting one contract. From the shareholder resolution through to the registration filing, the entire process needs to be properly structured from the outset.
If you need advice on stock option procedures or agreement drafting for your business in South Korea,
Decent Law Firm's Corporate Practice Group knows Korean corporate law inside and out. Contact us today.
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