ESOP in case of PVT limited Company
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
27 November 2010
Dear Members
My client is a Pvt ltd company who wants to issue ESOPs in form of equity shares of company to its Key employees, it has plan to go public in next 3 years, which would be the exit route for these ESOP's.
My question is that instead of transferring these shares directly to employees , can we make a trust for these shares and the key employees as its trusties or is there any other way where ESOP's can be issued to the key employees ???
My client is a Pvt ltd company who wants to issue ESOPs in form of equity shares of company to its Key employees, it has plan to go public in next 3 years, which would be the exit route for these ESOP's.
My question is that instead of transferring these shares directly to employees , can we make a trust for these shares and the key employees as its trusties or is there any other way where ESOP's can be issued to the key employees ???
Ajay Mishra
(Expert)
30 November 2010
Hi
I will suggest you to make ESOP Compensation Committee as per SEBI(ESOP/ESPS) Guidelines, 1999, and delegate the power as given in SEBI Guidelines.
However,the said Guideline will not apply to private company, but as you said that the management intention is to make such company as limited company. It will be better corporate practice to follow from beginning the said Guidelines.
Regards
I will suggest you to make ESOP Compensation Committee as per SEBI(ESOP/ESPS) Guidelines, 1999, and delegate the power as given in SEBI Guidelines.
However,the said Guideline will not apply to private company, but as you said that the management intention is to make such company as limited company. It will be better corporate practice to follow from beginning the said Guidelines.
Regards
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Depreciation Chart Companies Act
- EPF ECR NEW FILE SEP 17TH 2026
- Capital Gail Exemption Certificate
- Oct 2025 Invoices
- Import of Software Service.
- SECTION 393(3) TAX ON CASH WITHDRAWAL
- Clarification Requested: Gift → NRO → NRE → Overseas Transfer - USA/CANDA (FEMA & Tax Compliance)
- Under marginal scheme
- Capitalgain tax purposes for valuation report compulsory
- GST on Renting godown to KFCSC for Storage of Raagi
- GST Audit whether Govt Companies are exempt?
- IMPORT PURCHASE ENTRY PASSED IN BOOKS OF ACCOUNT
- FAST DS 26 Undisclosed Foreign Asset Disclosure Scheme 2026
- Regime change
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- FAST-DS 2026 Under Tax Law - No recourse or support for person declaring via this scheme?
- Guidance Needed: Linking Multiple Form 26QB Payments and Responding to ITD Defaulter Notice
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
