PHANTOM STOCK AGREEMENT

This Phantom Stock Agreement (hereinafter referred to as the “Agreement”) is made on [INSERT DATE ON WHICH THE AGREEMENT COMES INTO FORCE] (hereinafter referred to as the “Effective Date”) between:

[INSERT NAME OF THE COMPANY], having registered office at [INSERT ADDRESS OF THE COMPANY] (hereinafter referred to as the “Company” which expression shall, unless repugnant to the context or meaning thereof, means and includes its legal representatives, executors, administrators and permitted assigns); and 

[INSERT NAME OF THE INDIVIDUAL], having registered office at [INSERT ADDRESS OF THE INDIVIDUAL] (hereinafter referred to as the “Employee” which expression shall, unless repugnant to the context or meaning thereof, means and includes its legal representatives, executors, administrators and permitted assigns).

The “Company” and the “Employee” together shall be referred to as “Parties” and individually as a “Party”.

WHEREAS:

1. The Company wishes to grant [INSERT NUMBER OF SHARES] shares of Phantom stock to the employee through phantom stock plan of the Company.
2. The Parties mutually agree to the terms and conditions outlined in this Agreement, which governs the working relationship between the parties.
3. The parties are duly authorized and have the capacity to enter into this agreement.
4. Both the parties affirm to understand the provisions contained herein and in case either party requires clarification as to one or more provisions, either party has had the right to seek clarifications or sought legal guidance.

NOW, THEREFORE, in consideration of the mutual promises contained herein and intending to, be legally bound, the Parties have agreed as follows:

1. DEFINITIONS
   1. “Agreement” refers to the Phantom stock agreement along, with exhibits and attachments.
   2. “Employee” shall mean an individual, who has agreed to have phantom shares of the Company.
   3. “Phantom shares” refers to the total no. of shares granted by the company to the employee.
   4. “Vesting” refers to the process by which the employee’s right to phantom shares become non-forfeitable.
   5. “Confidential Information” shall mean the any non-public information, data, documentation, trade secrets, know-how, or any other information disclosed by one party (Company) to the other party (Employee) in connection with the terms and conditions whether in written, oral, electronic, or any other form, and identified as confidential or which the Parties should reasonably understand to be confidential.
2. PHANTOM STOCK GRANT
   1. The Company herby grants to the employee [INSERT NUMBER OF SHARES] phantom stock units (hereinafter referred to as “Phantom Shares”), as per the Company’s Incentive or Phantom Stock Plan, subject to the terms and conditions of the Plan and this Agreement.
3. TERM
   1. This Agreement shall commence on the effective date of [INSERT DATE OF AGREEMENT] and continue for [INSERT TERM PERIOD OF AGREEMENT IN DAYS/MONTHS/YEARS] as agreed by the parties. The Agreement may be terminated earlier in accordance with the termination provisions set forth herein, including termination upon mutual written consent or any other conditions specified within the Agreement that allow for early termination.
4. OBLIGATIONS OF THE COMPANY
   1. The Company shall maintain accurate records of the Phantom Shares granted, vested, and outstanding under this Agreement. The Company shall determine, in good faith, the fair market value of its shares at each vesting event, and shall issue timely statements or certificates reflecting the value of vested Phantom Shares in accordance with the terms of this Agreement. The Company shall make cash payments to the Employee corresponding to vested Phantom Shares as provided herein and shall comply with all applicable withholding obligations related thereto.
   2. The Company shall also provide the Employee with access to relevant documents or information necessary to understand the valuation and vesting status of the Phantom Shares. The Company shall act in good faith in administering the Phantom Stock Plan and shall not engage in any act or omission that would materially frustrate the purpose of this Agreement.
5. OBLIGATIONS OF THE EMPLOYEE
   1. The Employee shall diligently fulfill their duties and responsibilities in accordance with the terms of their employment or engagement with the Company. The Employee shall not engage in any activity that would conflict with the interests of the Company or that would give rise to a forfeiture under this Agreement.
   2. The Employee shall not attempt to assign, pledge, transfer, or otherwise dispose of any interest in the Phantom Shares except as expressly permitted under this Agreement. The Employee shall maintain the confidentiality of any non-public or proprietary information received from the Company and shall comply with all applicable policies, rules, and procedures of the Company that relate to equity compensation or confidentiality.
6. VESTING
   1. The Phantom shares granted to the employee under this agreement shall vest according to the following schedule: [INSERT DATE AND PERCENTAGE OF VESTING GRANT]
   2. Upon each vesting milestone, the Company shall make a payment to the Employee equal to the cash value of the vested Phantom Shares.
   3. Upon the vesting of Phantom Shares in accordance with sub-clause 4.1 of this Agreement, the Company shall issue a certificate or written statement to the Employee confirming the ownership and value of the vested Phantom Shares. Such certificate or written statement shall include the following details: [INSERT NUMBER OF PHANTOM SHARES VESTED AND CASH VALUE OF THE VESTED PHANTOM SHARES BASED ON THE FAIR MARKET VALUE OF THE COMPANY'S SHARES AT THE TIME OF VESTING]
   4. The Employee acknowledges that this certificate or written statement is for informational purposes and does not grant any additional rights or privileges beyond those outlined in this Agreement.
7. REPRESENTATION AND WARRANTY
   1. Each Party hereby represents and warrants to the other Party that the Party has full legal right, power, and authority to enter into this Agreement and to perform its obligations hereunder. The execution and delivery of this Agreement, and the performance of its terms, shall have been duly authorized by all necessary action on the part of such Party, and this Agreement shall constitute a valid and binding obligation enforceable in accordance with its terms.
   2. Each Party further represents and warrants that the execution and performance of this Agreement shall not violate or conflict with any provision of law, rule, or regulation, or any contract, agreement, or other instrument to which such Party is bound, nor shall it require the consent or approval of any third party that has not been obtained as of the Effective Date.
   3. The Employee represents and warrants that the acceptance of Phantom Shares and participation in the Company’s Phantom Stock Plan shall not violate the terms of any other agreement to which the Employee is a party or by which the Employee is bound.
   4. Each Party shall represent that all information provided to the other in connection with this Agreement is true, accurate, and complete in all material respects, and no representation or warranty made herein contains any untrue statement or omits any material fact necessary to make such statement not misleading.
   5. The foregoing representations and warranties shall survive the execution of this Agreement and shall continue in full force and effect during the term of this Agreement.
8. CONFIDENTIALITY
   1. The Employee acknowledges that during the term of their engagement with the Company and in connection with this Agreement, they may receive or have access to Confidential Information as defined herein. The Employee shall at all times maintain the confidentiality of such Confidential Information and shall not disclose, communicate, or use any such information for any purpose other than as strictly required to perform their obligations under this Agreement.
   2. The Employee shall not, without the prior written consent of the Company, disclose any Confidential Information to any third party, nor shall the Employee use any such Confidential Information for personal gain or to the detriment of the Company. These obligations shall survive the termination or expiration of this Agreement for a period of [INSERT NUMBER OF PERIOD IN DAYS/MONTH/YEARS] as agreed upon by the parties, or for such longer period as may be required under applicable law or a separate confidentiality agreement, if any.
   3. The obligations under this clause shall not apply to information that: (i) was known to the Employee prior to disclosure by the Company, (ii) becomes publicly available through no fault of the Employee, or (iii) is disclosed to the Employee by a third party lawfully entitled to make such disclosure without restriction.
9. TERMINATION
   1. In the event of the Employee's termination of employment or engagement with the Company, any unvested Phantom Shares shall be forfeited, and the Employee shall have no further rights to them.
10. INDEMNIFICATION
    1. Each party (“Indemnifying Party”) shall indemnify, defend, and hold harmless the other party, its affiliates, officers, directors, employees, agents, successors, and assigns (“Indemnified Party”) from and against any and all claims, demands, actions, suits, or proceedings initiated by third parties, as well as any resulting liabilities, damages, losses, costs, and expenses, including reasonable attorneys’ fees, to the extent such claims arise from;
       1. any breach by the Indemnifying Party of its covenants, agreements, or obligations under this Agreement;
       2. any inaccuracy or material misrepresentation in the representations or warranties made by the Indemnifying Party; or
       3. any claim that the use, licensing, or commercialization of intellectual property or proprietary rights by the Indemnifying Party infringes, misappropriates, or otherwise violates the rights of any third party. The Indemnified Party shall provide prompt written notice of any claim for which indemnification is sought, and the Indemnifying Party shall have the right to assume and control the defence with counsel of its choosing, subject to the Indemnified Party’s reasonable approval.
    2. The Indemnified Party shall cooperate in good faith, and while it may participate in the defence at its own expense, the Indemnifying Party shall not settle any claim without the Indemnified Party’s prior written consent if such settlement imposes liability, does not provide a full release, or includes an admission of wrongdoing. Indemnification shall not apply to the extent that the claim arises from the Indemnified Party’s own wilful misconduct, negligence, or material breach of this Agreement.
11. LIMITATION OF LIABILITY
    1. Notwithstanding anything to the contrary contained in this Agreement, neither Party shall be liable to the other for any indirect, incidental, special, consequential, or punitive damages, including but not limited to loss of profits, revenue, business opportunities, or goodwill, arising out of or relating to this Agreement, whether based in contract, tort (including negligence), or otherwise, even if advised of the possibility of such damages.
    2. The Company’s total aggregate liability arising out of or related to this Agreement, whether in contract, tort, or otherwise, shall in no event exceed the total value of the vested Phantom Shares payable to the Employee as of the date of such claim.
    3. This clause shall not apply to liability arising from (i) a Party’s willful misconduct or gross negligence; (ii) breach of the confidentiality obligations under this Agreement; or (iii) violation of applicable law.
12. DISPUTE RESOLUTION
    1. The Parties shall endeavour to resolve any differences of opinion which may arise between them with respect to the provisions of this Agreement by negotiation between themselves personally or with the assistance of their attorneys and unless in the opinion of any party, acting reasonably, the matter in dispute is of such significant nature to warrant it being addressed otherwise, no party shall commence any public proceedings until the negotiations have failed to produce a resolution. In furtherance of the provisions of this paragraph, all Parties hereby agree to make themselves available on short notice and to negotiate promptly and in good faith, any matter any party may wish to negotiate.
    2. All disputes arising under this agreement shall be governed by and interpreted in accordance with the Arbitration laws of [INSERT COUNTRY/STATE OF ARBITRATION] , without regard to principles of conflict of laws. The parties to this agreement will submit all disputes arising under this Agreement to Arbitration in [INSERT COUNTRY/STATE OF ARBITRATION] before a single arbitrator . The arbitrator shall be selected by mutual agreement of the parties. The venue of Arbitration proceedings shall be [INSERT NAME OF COUNTRY AND CITY WHERE ARBITRATION SHALL BE CONDUCTED] No party to this agreement will challenge the jurisdiction or venue provisions as provided in this section. The decision of the Arbitrator shall be final and binding upon the parties.
13. RESTRICTIONS ON TRANSFERS
    1. The Employee may not sell, transfer, pledge, exchange, hypothecate or dispose of Phantom Shares in any manner. A breach of these terms of this Agreement shall cause a forfeiture of the Phantom Shares.
14. WITHHOLDING OF TAX
    1. To the extent that the grant or vesting of a Phantom Share results in the receipt of compensation by Employee with respect to which the Company has a tax withholding obligation pursuant to applicable law, unless other arrangements have been made by Employee that are acceptable to the Company, which, with the consent of the Committee, may include withholding a number of Shares that would otherwise be delivered on vesting that have an aggregate Fair Market Value that does not exceed the amount of taxes to be withheld, shall deliver to the Company such amount of money as the Company or may require to meet its withholding obligations under such applicable law. No delivery of Shares shall be made under this Agreement until Employee has paid or made arrangements approved by the Company to satisfy in full the applicable tax withholding requirements of the Company.
15. APPLICABLE LAW
    1. This Agreement shall be governed by and constructed in accordance with the Laws, rules, orders and regulations of [INSERT THE COUNTRY OF APPLICABLE LAWS].
    2. The Parties shall resolve all disputes in connection with the validity or interpretation of this Agreement, unless otherwise expressly stated in the Agreement, in the following manner: 
       1. By direct negotiations between the Company and Employee. 
       2. If negotiations between the parties are unsuccessful, the matter shall be referred to the competent court sitting at [INSERT THE PLACE OF COURT WHICH SHALL HAVE EXCLUSIVE JURISDICITION IN CASE OF DISPUTE BETWEEN THE PARTIES] which shall have exclusive jurisdiction in all matters arising there from unless otherwise agreed between the Parties in writing.
16. FORCE MAJUERE
    1. Neither party shall be held liable for any failure or delay in performing its obligations under this Agreement if such failure or delay is caused by events beyond the reasonable control of the affected party, including but not limited to acts of God, natural disasters (e.g., floods, earthquakes, hurricanes), war, terrorism, riots, labour strikes, governmental actions, epidemics or pandemics, power outages, or other similar events ("Force Majeure Events").The affected party shall promptly notify the other party in writing of the occurrence of a Force Majeure Event, providing reasonable details of the event, its expected duration, and the steps being taken to mitigate its impact. Failure to provide timely notice may result in the affected party forfeiting its rights under this clause. If a Force Majeure Event continues for a period exceeding [INSERT THE NUMBER OF DAYS CONSTITUTING PERIOD EXCEEDING WHICH, IF THE FORCE MAJEURE CONTINUES, EITHER PARTY MAY TERMINATE THE AGREEMENT] days, either party may terminate this Agreement upon written notice to the other party without further liability, except for obligations accrued prior to the Force Majeure Event.
17. RESTICTIVE COVENANTS
    1. The Employee agrees that, during the term of their engagement with the Company and for a period of [INSERT THE NUMBER OF DAYS/MONTHS/YEAR FOR NON SOLICATIATION] as agreed by the parties following the termination of such engagement for any reason, the Employee shall not, directly or indirectly, solicit, attempt to solicit, or induce any employee, consultant, contractor, supplier, or client of the Company to terminate, reduce, or otherwise alter their relationship with the Company. The Employee further agrees not to assist any third party in such solicitation efforts.
    2. The Employee further agrees that, during the term of their engagement with the Company and for a period of [INSERT THE NUMBER OF DAYS/MONTHS/YEAR] as agreed by the parties following the termination thereof, the Employee shall not, directly or indirectly, engage in, be employed by, or provide services to any business, enterprise, or entity that competes with the business of the Company in any territory in which the Company operates or has demonstrable plans to operate as of the date of such termination. This restriction shall not prevent the Employee from holding passive investments of not more than five percent (5%) in any publicly traded company.
    3. These obligations shall survive the termination or expiration of this Agreement and shall be enforceable to the fullest extent permitted by applicable law. If any provision of this section is held to be invalid or unenforceable, it shall be reformed to the minimum extent necessary to make it enforceable, or if not possible, deemed severable from the remainder of this Agreement.
18. NOTICES
    1. Any notice, request, demand, consent or other communication required or permitted under this Agreement shall be in writing and sent either via email on the email address as provided by the parties and shall be considered sent when the email is sent to the correct email address of the party or shall be given by personal delivery (including courier) by certified mail (confirmed by mail) addressed to the party for which it is intended at the address below and shall be deemed to be given on the day of delivery or transmission if within during normal business hours, or, if after business hours, on the next following Business Day, or if mailed by registered or certified mail, on the day which is [INSERT THE APPLICABLE NUMBER OF BUSINESS DAYS WITHIN WHICH THE NOTICE WILL BE DEEMED SERVED] Business Days after such notice is mailed during normal postal conditions.  In the event of a postal disruption, any notice mailed will be deemed received on the [INSERT THE APPLICABLE NUMBER OF BUSINESS DAYS WITHIN WHICH THE NOTICE WILL BE DEEMED SERVED] Business Day following resumption of regular postal service:
       1. If to the Company : [INSERT EMAIL ID OR/AND ADDRESS OF THE COMPANY]
       2. If to the Employee: [INSERT EMAIL ID OR/AND ADDRESS OF THE EMPLOYEE]
    2. Either party may change its address/email address for notices and other communications upon notice to the other party in the manner aforesaid.
19. MISCELLANOUS
    1. Modifications: Except as otherwise provided herein this Agreement shall not be amended or otherwise modified unless the modification or amendment is done in writing, signed and has been mutually agreed by both the parties.
    2. Language: The language of all communications between the parties pursuant to this Agreement, including notices and reports, will be the [INSERT LANGUAGE OF ALL COMMUNICATION].
    3. Severability: If any provision of this Agreement shall, to any extent, be held to be invalid or unenforceable, it shall be deemed to be separate and severable from the remaining provisions of this Agreement, which shall remain in full force and effect and be binding as though the invalid or unenforceable provision had not been included.
    4. Entire agreement: This agreement along with all the Exhibits constitutes the entire understanding and agreement of the parties with respect to its subject matter and supersedes all prior and contemporaneous agreements or understandings, inducements or conditions, express or implied, written or oral, between the parties. This Agreement may be executed in identical duplicate counterparts, each of which shall be deemed an original, and both of which together shall constitute one and the same instrument. 
    5. No Waiver: Any failure or delay of any Party hereto in exercising any right or privilege with respect to this Agreement shall not be construed to be a waiver or to affect the validity of any part of the Agreement and shall not retrain any of the Parties to enforce any of the provisions of the Agreement.
    6. Amendments and Assignments:  Any amendments to this Agreement shall be made, only if, both Parties agree upon such amendment in writing. This Agreement shall not be assigned by either party without the express, written consent of the other party.
    7. Headings: The headings upon the various sections are solely for convenience and reference only and shall not affect the scope, meaning, intent or interpretation of the provisions of this Agreement, nor shall such headings otherwise be given any legal effect.
20. INDEPENDENT LEGAL ADVICE
    1. The Parties are advised to seek independent legal counsel before entering into this Agreement. Each Party acknowledges that they have been given a reasonable opportunity to consult with an attorney of their choosing regarding the terms, conditions, and obligations set forth in this Agreement, including any restrictions or commitments imposed herein.
    2. By signing this Agreement, the Parties confirm that they have either sought such independent legal advice or voluntarily chosen to proceed without it. Each Party further represents that they are entering into this Agreement knowingly, voluntarily, and with a full understanding of its provisions. The Parties acknowledge that they are not relying on any statements, promises, or representations made by the other Party or any representative thereof that are not expressly included in this Agreement.
21. DECLARATION
    1. The Parties hereby acknowledge that the terms herein have been read, fully understood, and expressly agreed to, and hereby commit to performing their obligations with due diligence, honesty, and in good faith. The Parties hereby agree to foster a collaborative environment that promotes transparent communication and timely resolution of any issues, thereby ensuring compliance with all applicable laws and industry best practices.

IN WITNESS WHEREOF, the parties, intending to be legally bound, have each executed this agreement as of the effective date.

Signed, sealed and delivered on behalf of Company

Name: [INSERT NAME OF COMPANY/SIGNING AUTHORITY AND DESIGNATION]

Signature:

Date: [INSERT SIGNING DATE ON BEHALF OF COMPANY]

Signed, sealed and delivered on behalf of Employee

Name: [INSERT NAME OF EMPLOYEE/SIGNING AUTHORITY AND DESIGNATION]

Signature: 

Date: [INSERT SIGNING DATE OF EMPLOYEE]