ESOP Trust Deed(Drafting)

The Companies Act, 2013 contains the enabling provisions under section 62 (1) (b) pursuant to which the Company can issue the shares to its employees at a predetermined price with the right to exercise an option to purchase shares in the capital of the Company. Every listed Public Companies are required to comply with the provisions of the Listing Agreement and the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 for issuance of the shares under the Employees Stock Option Scheme or Employees Stock Purchase Scheme.

Employee  Stock  Option  Scheme  or  ESOS is  a  scheme  under  which  a  Company grant its employees stock option directly or through a trust under which a company offers shares to employees, as part of public issue or otherwise, or through a trust where the trust may undertake secondary acquisition for the purposes of the scheme.Every listed Public Companies are required to comply with the provisions of the Listing Agreement and the Securities and Exchange Board of India Regulations.

EMPLOYEES STOCK OPTION SCHEME (ESOS)

 

Basic Concept

 

Employee  Stock  Option  Scheme  or  ESOS is  a  scheme  under  which  a  Company grant its employees stock option directly or through a trust under which a company offers shares to employees, as part of public issue or otherwise, or through a trust where the trust may undertake secondary acquisition for the purposes of the scheme.

 

The Companies Act, 2013 contains the enabling provisions under section 62 (1) (b) pursuant to which the Company can issue the shares to its employees at a predetermined price with the right to exercise an option to purchase shares in the capital of the Company.

 

Every listed Public Companies are required to comply with the provisions of the Listing Agreement and the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 for issuance of the shares under the Employees Stock Option Scheme or Employees Stock Purchase Scheme.

 

How we help with replying to trademark objection

 

1. Consultation: LEGALRAJ will determine a course of action to assist in issuance of the shares under the Employees Stock Option Scheme or Employees Stock Purchase Scheme.

 

2. Preparation of Documents: Based on the discussion and course of action decided, we will draft the documents for issuance of the shares under the Employees Stock Option Scheme or Employees Stock Purchase Schemeand file necessary E-forms and returns with the jurisdictional Registrar of Companies within decided timelines.

Documents


Passport Photo

Passport photo of all parties.


PAN Card

PAN card of all parties.


Aadhar Card

Aadhar card of all parties.


Utility Bill

Utility bill of Electricity or Telephone.


Address Proof

Valid Address Proof of all the parties.


Licence

Valid Driving Licence of all the parties.


Terms and Conditions

Terms and Conditions between the parties.


Other Documents

Other documents will be intimated through e-mail.

FAQ

In an ESOP, a company sets up a trust fund, into which it contributes new shares of its own stock or cash to buy existing shares. Alternatively, the ESOP can borrow money to buy new or existing shares, with the company making cash contributions to the plan to enable it to repay the loan.

The ESOP Trust receives stock either from company by way of fresh allotment or by purchasing from existing shareholders in open market or the owner of the company may sell shares of his holding to the ESOP Trust. A company can extend loan to the Trust for purchasing the Shares.

Employee Stock Ownership Plan (ESOP).

An employee stock ownership plan (ESOP) is an employee benefit plan that gives workers ownership interest in the company. ESOPs give the sponsoring company, the selling shareholder, and participants receive various tax benefits, making them qualified plans.

Generally, ESOP companies are more productive, faster growing, more profitable and have lower turnover — benefits that accrue to all stakeholders including the retirement accounts of the employee-owners. In addition, an ESOP is a great way to enhance the company's ability to recruit and retain top talent.

Typically only permanent employees and directors (other than directors who together with relatives hold more than 10%) in the company are eligible to receive ESOP.

ESOP Trust (a Private Trust formed as a separate entity, but not being a charitable Trust) can be formed under the Indian Trust Act, 1882. Shares of the company can be held by the Trustees is held as beneficial owners.