Answer:
Share vesting is when shares will vest at a later period of time, for example, if an employee has been working for you for 1-year, shares will beginning vesting, and after 4 years the shares will be fully vested. This protects the business from employees leaving early and taking their shares with them. This is set out in the Share Vesting Agreement, which will also comply with the initial Shareholders Agreement. If you are planning on giving a small number of shares to many employees you should also be aware of the new Employee Share Scheme legislation.
