Our Equity Services
Managing equity is critical for founders, employees, and investors alike. VirtualCounsel helps startups issue stock options, equity grants, and incentive plans compliantly—avoiding messy cap tables and protecting company value. With expert support in cap table management and investor readiness, we ensure your equity structure scales with your business.
Stock Option Grant (ISO / NSO)
Grant stock options with clarity, compliance, and confidence.
We prepare customized Stock Option Grant Agreements issued under your company’s Equity Incentive Plan (EIP), ensuring each grant is properly structured, authorized, and documented for compliance and future diligence. Whether issuing Incentive Stock Options (ISOs) or Nonqualified Stock Options (NSOs), we help you understand the differences and select the structure that best aligns with your compensation strategy, tax considerations, and employee expectations.
This service delivers clean documentation, proper board approvals, and clear guidance on vesting, exercise mechanics, and equity administration—so you can issue option awards confidently and maintain a complete, compliant paper trail.
Scope of Work
- Draft Stock Option Grant Agreement tailored to Client’s EIP and specific award terms
- Draft corresponding Board Consent approving the stock option grant
- Conduct consultation with Client via phone/email to address ISO vs. NSO classification, vesting schedules, exercise mechanics, and other compliance considerations
- Finalize Grant Agreement and Board Consent for execution and circulation for e-signature
An 83(b) election allows employees with early-exercised options to pay taxes at grant, potentially reducing future tax liability if the stock increases in value.
No. Stock options only create value if the company’s market value exceeds the strike price. Many startup options expire worthless.
Founder / Restricted Stock Purchase Agreement (FSPA / RSPA)
Establish founder and early team ownership with clear, compliant equity documentation.
We prepare customized Founder and Restricted Stock Purchase Agreements (FSPA / RSPA) that formalize equity ownership and protect your company’s long-term interests. These agreements define vesting, repurchase, and transfer terms to ensure your capitalization table remains clean, compliant, and investor-ready. Ideal for founders, early hires, or advisors receiving restricted stock at formation or during early growth.
Scope of Work
- Draft Founder / Restricted Stock Purchase Agreement tailored to Client’s capitalization and governance documents
- Draft corresponding Board Consent approving the issuance
- Consultation with Client via phone/email to address relevant vesting schedules, repurchase rights, and compliance considerations
- Finalize Founder / Restricted Stock Purchase Agreement and Board Consent for execution and circulation for e-signature
Not always. Equity is more common in early-stage startups and higher-level roles, though many growing companies expand equity participation to create a stronger ownership culture.
Investors prefer balanced and fair structures that reflect commitment and discourage disputes. Unequal or poorly documented splits can raise red flags.
There’s no single formula. Many accelerators recommend equal splits to avoid resentment, since the majority of value creation lies ahead. Others prefer contribution-based allocations that reflect past input. What matters most is alignment and trust - and making sure all founder equity vests over time.
Stock Award / Grant (RSA, RSU, SAR)
Issue equity awards confidently with clear, compliant documentation and board approval.
We prepare customized Stock Award and Grant Agreements issued under your company’s Equity Incentive Plan (EIP), ensuring each award aligns with your governance documents, capitalization structure, and long-term incentives strategy. This service covers a variety of award types—including Restricted Stock Awards (RSAs), Restricted Stock Units (RSUs), and Stock Appreciation Rights (SARs)—and offers thoughtful structuring around vesting, transfer restrictions, and compliance.
Whether you’re incentivizing executives, employees, advisors, or founders, we help you issue equity awards smoothly and confidently, while safeguarding your company’s interests and maintaining a compliant paper trail for future due diligence.
Scope of Work
- Draft Stock Award / Grant Agreement tailored to Client’s equity structure and award type
- Draft corresponding Board Consent approving the issuance
- Consultation with Client via phone/email to address vesting, transfer restrictions, and compliance considerations
- Finalize Stock Award / Grant Agreement and Board Consent for execution and circulation for e-signature
- RSAs (Restricted Stock Awards): Shares are issued upfront, subject to repurchase rights if unvested. Best for founders and early hires when valuation is low.
- RSUs (Restricted Stock Units): Shares are delivered only when vesting is complete. Best for later-stage hires when valuation is high.
RSAs are generally more effective for very early-stage startups with low valuations, since they allow employees and founders to lock in minimal tax liability through an 83(b) election.
It depends on company stage. RSAs can be advantageous early on, while RSUs may be more predictable in later-stage or pre-IPO companies with higher valuations.
Equity Incentive Plan (EIP)
Design and implement an equity plan that drives alignment, retention, and growth.
We prepare a customized Equity Incentive Plan (EIP) that enables your company to issue options or other equity awards to employees, advisors, and directors. This service ensures your plan is investor-ready, compliant with applicable securities laws, and easy to manage as your company scales.
Scope of Work
- Draft comprehensive Equity Incentive Plan and related board and stockholder consents
- Draft form of Option Grant Agreement and related award documentation
- Consultation with Client via phone/email to address relevant plan design, vesting schedules, and compliance considerations including 409A
- Finalize Equity Incentive Plan and Agreements for adoption and implementation
An EIP can include stock options, restricted stock, RSUs, and other equity-based awards, giving flexibility to tailor compensation.
Yes. Even small teams benefit from setting aside equity early. Without one, you risk complications in hiring, fundraising, and future compliance.
Yes. A larger pool can dilute per-share value, which impacts how acquisition proceeds are distributed among shareholders and option holders.
Cap Table Setup and Management
Streamline your equity management with accurate, investor-ready capitalization records.
As Carta Certified Experts, we help you streamline equity management with precise, compliant cap table solutions. Clients onboarding through us enjoy 20% off Carta subscriptions, and while Carta is our preferred platform, we’re equally equipped to support cap tables built on other platforms.
This service includes a detailed review of all existing equity documentation—founder and employee stock agreements, investor agreements (including convertible notes, SAFEs, and warrants)—as well as the creation of a comprehensive pro forma cap table. We ensure your records are accurate, compliant, and ready for investors or auditors.
Scope of Work
- Analyze existing cap table and all supporting equity documentation
- Review Founder, Employee, and Investor Stock Purchase and Option Agreements
- Review Convertible Notes, SAFEs, and Warrants
- Build detailed Pro Forma Cap Table reflecting current and post-transaction ownership
- Consultation with Client via phone/email regarding 409A valuation planning and equity strategy
- Finalize Cap Table for compliance and investor readiness
Stock options remain the most common, but RSAs and RSUs are increasingly popular depending on company stage and employee needs.
Absolutely. Grants should be approved by the board, backed by a 409A valuation, and issued through a written equity plan.
Investor-Ready Package
Position your company for fundraising success with clear, compliant, investor-grade documentation.
Whether you’re raising your first round or preparing for institutional investment, this service ensures your company is ready to meet investor expectations. We combine practical business strategy with legal precision to get your house in order—so you can focus on capital, not cleanup.
Scope of Work
- Conduct legal and structural review of company formation documents, governance materials, and capitalization table
- Identify and prioritize legal or operational gaps impacting investor readiness
- Draft or update key materials, such as Charter, Bylaws, Stock Purchase Agreements, or convertible instruments, as needed
- Consultation with Client via phone/email to address structure, investor relations, and closing logistics
- Build or refine pro forma cap table and prepare deliverables for investor review or due diligence
- Finalize documentation for investor presentation or financing readiness
VirtualCounsel, PC (i.e., @VirtualCounsel) is a virtual law firm headquartered in San Diego, CA. We are progressive corporate attorneys. We are a startup ourselves, and we built our law firm to serve startups in the way that we believe a professional service provider should serve their clients.
You have on-demand access to your attorney POC and the entire team via scheduled phone/video consultations, email, and Slack messages.
Our Equity Offerings Guide
What our clients are saying
"Great communication throughout. Professional and personable."
"Great communication throughout. Professional and personable."
Longview Labs needed a business formation partner that could make the process feel both straightforward and professional for a first-time founder. @VirtualCounsel delivered exactly that—a smooth, personable consultation that combined professionalism with clear communication. With the business properly formed, Longview Labs launched with a strong foundation and a legal team ready for the road ahead.
“@VC came in at a really critical time.
They actually ended up serving as a role of sales enablement by being a partner that can react quickly and get us the right kind of agreements in place with big enterprises.”
“@VC came in at a really critical time.
They actually ended up serving as a role of sales enablement by being a partner that can react quickly and get us the right kind of agreements in place with big enterprises.”
Bench Talent Cloud needed a legal partner that could keep up with its pivots, product advancements, and enterprise deal flow without slowing the business down. @VirtualCounsel stepped in as fractional General Counsel, handling SaaS agreements, MSA/SOWs, fundraising, cap table management, and even enabling enterprise sales by getting the right agreements in place fast.
@VC also represented Fulcrum Workforce Solutions (our original client) through a strategic merger with Open Assembly to create the technological powerhouse that is Bench Talent Cloud. Today, Bench has a seasoned legal team in its corner and a business that continues to grow.
“We're a tech startup, so we don't have the luxury of finding out what we owe in legal fees at the end of the month based on an email or phone call we didn't know about. So having a consistent retainer that we can really trust in, depend on, and make budgeting decisions based off of is huge. I honestly have had the best experience working with @VirtualCounsel. Not just the predictability of payments, but more so the level of service has been above and beyond any service-based company I have ever worked with. "
"I think the most important thing is that I felt like I had counsel. I had someone that I could rely on regularly, whenever I had a concern. They mapped out everything I needed to do for the weeks and months ahead in order to keep my company compliant, stable, and secure so that I had the space to go out and do my work and do my business."
“With any other legal team, I’ve already had the experience that it’s going to be more expensive, more difficult, and just cause me heartache. Working with @VirtualCounsel is a HUGE difference – I tell everyone I can about how great @VirtualCounsel is, and I recommend them to anyone with a start-up or growing business. They've helped me with almost every single legal aspect of my business you can think of."
"I actually ENJOY talking with my legal team! They do everything so fast. The communication is so fast, you’re not calling a secretary, you’re not waiting. It’s all online where you can chat very very quickly with @VirtualCounsel in Slack and get your questions answered and then, if needed, you can hop on a quick call with them and go over what you actually need to do.”
"I like that Daniel's team kept reminding me to attend to the foundational signatures required to keep the process moving. As a founder, I'm constantly getting my attention pulled away from the priorities -- and getting this corporation formed and initial stock allocated, was a priority (that I was inclined to drag my feet on)."
“We’re really grateful that @VirtualCounsel has been alongside us for our whole journey. Scrapping together legal documents is a bad idea, so we’re really glad we’ve had @VirtualCounsel from the beginning because those early decisions are impacting things we’re dealing with today and we’re really glad we had the whole professional structure set up.”
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FAQs
Both give the right to purchase stock at a fixed price, but:
- Stock options are usually granted to employees as compensation.
- Warrants are often given to investors, lenders, or strategic partners as part of financing or business agreements.
Yes, but typically through NSOs, RSUs, or phantom equity rather than ISOs. International employees may require country-specific equity plans due to tax and legal differences. Always consult counsel before granting equity outside the U.S.
Not always. While founders begin with control, each financing round introduces new investors with board seats, voting rights, and protective provisions. Some founders implement dual-class stock or other structures to retain control, but most startups rely on alignment with investors rather than super-voting rights.
Dilution reduces your percentage ownership as new shares are issued, but it doesn’t necessarily reduce the dollar value of your stake. If a funding round increases valuation, your smaller percentage may still be worth significantly more in absolute terms.
It depends on the acquisition terms. Options may be assumed by the acquirer, cashed out, or accelerated. Double-trigger acceleration is common, meaning unvested shares vest if the company is acquired and the employee is terminated without cause.
At least once per year, or whenever a major event occurs (funding round, acquisition offer, significant revenue milestone). A current 409A valuation is required to set fair market value for stock option grants and to maintain compliance with IRS rules.
- RSAs (Restricted Stock Awards): Shares are issued upfront, subject to repurchase rights if unvested. Best for founders and early hires when valuation is low.
- RSUs (Restricted Stock Units): Shares are delivered only when vesting is complete. Best for later-stage hires when valuation is high.
An 83(b) election allows recipients of restricted stock to pay taxes at grant rather than as shares vest. Founders and early employees almost always benefit from filing, since share value is usually negligible at the start. Missing the 30-day deadline can create significant tax burdens later.
Yes. Even small teams benefit from reserving equity for future hires. Without a pool, you may run into hiring roadblocks or face last-minute dilution negotiations with investors. Most early-stage companies set aside 10–20% of total equity.
- ISOs (Incentive Stock Options): Employees only, potential tax advantages, subject to holding rules and limits.
- NSOs (Non-Qualified Stock Options): Broader eligibility (contractors, advisors, board members), taxed as ordinary income at exercise. Both give the right to buy stock at a set price, but their tax treatment differs significantly.
Both give the right to buy stock at a set price, but their tax treatment differs significantly.
Most founders get equity compensation wrong.
You're trying to figure out stock options, vesting schedules, and cap tables without clear guidance.
You're concerned about dilution, fairness to early employees, and maintaining founder control.
You're risking future fundraising complications because your equity structure isn't investor-ready.
We get it, which is why we structure equity plans that are built to last.
Your Equity Advantage
Clean, Accurate Cap Tables
Attract & Retain Talent
Investor-Ready Structure
Equity Plans Built for Growth
Partner with our equity experts to structure ownership the right way. From stock option grants and equity incentive plans to cap table management and investor-ready packages, we’ll ensure compliance and accuracy so you can focus on growing your business.