

Ask HN: Equity for Non-US employees - yummyfajitas

I've got a bit of a conundrum. I have an employee located in India, to whom I'd like to give an equity stake in my US startup. In principle, I'd like to give him more or less the valley standard - x% over 4 years.<p>The employee is currently physically located in India, and is employed by an Indian corporation which sells services to the US corporation. Let's assume US immigration authorities will never allow him to physically enter the US.<p>I'm concerned about the specific mechanics of how to structure such an equity agreement. Particular issues:<p>a) Enforceability. This is the biggie. How can I construct a contract which he can enforce? We can transfer equity in a US corporation to him with little difficulty, but how can he enforce his equity rights? It's unlikely that any US lawyer would be willing to get involved in such a cross-border dispute, at least not for the sums of money involved.<p>b) Taxation. How can we avoid having him taxed by both the US and India?<p>We are thinking about multiple mechanisms. One is for him to sign an equity-like cash-settled contract with the Indian corporation. Another is for him to directly invest 1 rupee every month, in return for X/48 shares, and we can terminate this agreement whenever we like. (If we terminate the agreement, he quits, roughly equivalent to firing before fully vested.)<p>Has anyone here done something like this in the past? How did you structure it? Any pitfalls to be aware of?<p>tl;dr How can I give an Indian employee equity in a US corporation and minimize the ability of future owners of the company to screw him over?
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aptwebapps
Equity may be tricky but cross-border contracts are nothing new. I think you
just need to find the right kind of lawyer.

