Share Appreciate Rights Sars Sample Clauses

A Share Appreciation Rights (SARs) clause grants employees or other participants the right to receive a payment equivalent to the increase in value of a company’s shares over a set period, without requiring them to purchase or own the shares themselves. Typically, SARs are settled in cash or shares, and the payout is calculated based on the difference between the grant price and the market price at the time of exercise. This clause is used to incentivize and reward participants for the company’s growth, aligning their interests with shareholders while avoiding the dilution of equity that comes with issuing new shares.