Business Legal Services
Hurdle Share Schemes
Incentivise growth and protect existing value with Hurdle Share schemes
Hurdle Shares offer a smart way to reward key employees with equity, without diluting the value already created by founders and early shareholders. Under a Hurdle Share scheme, employees only benefit from growth above a pre-agreed ‘hurdle’ value, keeping them focused on driving long-term performance.
Our experienced team will work with you to design and implement a Hurdle Share arrangement that aligns with your commercial goals, protects shareholder interests, and motivates your team through meaningful equity participation.
Whether used on their own or in combination with other schemes like Growth Shares or EMI options, we’ll guide you through the process and ensure the structure fits your stage of growth and exit plans.
How we support you
Designing and implementing Hurdle Shares
Using hurdle share plans can be a powerful way to help you achieve your company’s long-term goals. Typically issued by fast-growing private limited companies, these shares are offered to key management and employees as incentives to boost the company’s value before a planned exit. Staff purchase the shares at market value, and only benefit if the company exceeds a predetermined threshold – the ‘hurdle’.
We partner with you to determine how a hurdle share plan would work in practice. We’ll guide you through essential considerations, such as whether your own shares will be diluted, how existing shareholders or investors may respond, and how to reassure them. We’ll also explain how your company can be valued, how to set what employees pay, and whether you can link the hurdle to business targets or individual performance. We’ll clarify what happens if an employee leaves, for instance, whether they retain shares, and explain any tax advantages and tax risks. If relevant, we’ll also explore setting up a hurdle share scheme alongside other employee share plans.
Our experienced team can guide you through every step of designing and implementing a Hurdle Share plan tailored to your needs. We can help with:
Recommending the right scheme assessing whether Hurdle Shares (or alternatives like Growth Shares, EMI options,) best suit your business type, sector, stage of growth, and long-term goals
Designing scheme terms including employee rights around voting and dividends, as well as robust good and bad leaver provisions
Setting the hurdle helping you define the hurdle value, and advising on any employee purchase price for the shares
Updating legal documents amending your articles of association and shareholder agreements to allow for new share classes and ensure alignment across all stakeholders
Managing shareholder interests ensuring existing shareholders understand how the scheme works and are protected from early dilution
Explaining tax implications helping you understand and communicate how the scheme interacts with SEIS/EIS reliefs and providing advice regarding employee and employer tax liabilities, including income tax and capital gains and national insurance contributions
Handling elections and compliance entering into section 431 elections where needed, and ensuring all documentation is commercially sound
Hurdle Share plans are an effective option for businesses looking to scale responsibly while keeping their team motivated to reach the next level.
Why work with specialist solicitors?
Gain a competitive edge with the right legal structure
Companies with employee share schemes are shown to be more profitable and productive. A well-structured hurdle share plan, guided by expert legal advice, can help you attract and retain top talent while aligning rewards with long-term business goals.
Save time with simplified, compliant schemes
Unlike some other schemes, hurdle shares don’t require compliance with statutory conditions making them easier to manage. Our legal team ensures your plan is properly structured from the start, saving you time, effort, and potential risk.
Access greater flexibility and control
Hurdle shares give you the freedom to tailor terms to your business needs, such as setting conditions around performance or employee exit. Our team will help you build in the right protections, keeping your incentives flexible and cost-efficient.
Protect existing shareholders and manage dilution
When employees become shareholders, it’s vital to safeguard existing ownership. We’ll help you structure your plan so that hurdle shares only provide value after the ‘hurdle’ is met, protecting your shareholding and that of existing stakeholders.
Ensure tax efficiency and the right scheme fit
Employees can benefit from capital gains tax treatment rather than income tax, but choosing the right structure is key. Our experts will advise on the most suitable and tax-efficient model for your business, whether you’re considering a hurdle plan, EMI, or another arrangement.
Who we help
Founders and senior leaders in ambitious businesses
We work with a diverse range of high-growth, UK-based start-ups and scale-ups looking to design equity-based incentives that help retain and motivate key employees as they grow. For businesses planning an eventual exit, getting early legal guidance is crucial to ensure your share plan supports your long-term goals, protects stakeholder interests, and strengthens talent retention.
For many founders, the challenge lies in rewarding talent without giving away too much equity too early or causing unnecessary shareholder dilution. That’s where Hurdle Shares can be an effective solution.
We help founders structure schemes that align employee rewards with business performance or exit value, while protecting existing shareholder interests and managing tax exposure. Our team provides the legal and commercial insight needed to design and implement a Hurdle Share arrangement that supports your long-term goals.
Finding the right legal partner
Why work with Harper James
Choose a legal partner you can trust: we’ll help protect your goals, your business and your people so you can move forward with confidence and focus on growing your business.
Affordable, transparent and predictable pricing
Clear itemised invoices, subscription plans with up to 50% discount, and fixed fee products help you plan and manage legal spend – with no nasty surprises.
Proven track record and measurable results
We’ve supported over 8,000 businesses since 2014, with an ‘Excellent’ rating on Trustpilot and a Net Promoter Score (NPS) of 60+ from monthly client surveys.
Straight-talking, responsive advice
We’re here to make things easier, not add complexity. That means fast response times, practical expert legal advice delivered in plain English, and dedicated client service and account management support.
Risk and compliance assured
We’re an SRA regulated firm, but more importantly, we build quality, data, and compliance best practice into everything we do.
Appointing a legal partner is a big decision. That’s why we’re open about our values, culture and model, so you can see what makes us tick. And because a productive partnership starts with understanding, we always begin with a conversation – listening to your goals, pressures and plans, then tailoring our support to fit.
Testimonials
What our clients say
Meet our team
Why choose us?
Many of us have worked at some of the UK’s most respected law firms, as well as served as in-house legal counsel or senior leaders within businesses. This diverse experience enables us to provide practical, tailored legal advice that meets your specific needs.
In addition to supporting your share plans, you can rely on our experienced team of solicitors for a broad range of business legal services, including corporate governance advice, immigration law and employment policies.
Find out more about who you’ll be working with:
Pricing and service plans
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to fit your business needs
Our three transparent service plans are designed to give you the widest possible access to high-quality legal advice, whatever the size and nature of your business:
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