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ESOP in case of PVT limited Company

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Querist : Anonymous

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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 ???
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Ajay Mishra

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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
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