What is ESPS?

Question

What is Employees Stock Purchase Scheme?

in progress 0
William 1 year 1 Answer 529 views Silver 0

Answer ( 1 )

  1. An Employee Stock Purchase Scheme is  a scheme under which employees of the company are offered shares which are part of public issue or otherwise.

    _x000D_

    SEBI ( Employee Stock Option And Employee Stock Purchase Scheme) Guidelines, 1999 provides the guidelines for the ESPS. As per these Guidelines:

    _x000D_

    Who can participate in this scheme?

    _x000D_

      _x000D_

    • only bonafide employees 
    • _x000D_

    • employee must not be promoter or should not relaate to promoter group
    • _x000D_

    • if a director himself or through his relatives holds more than 10% of the outstanding euity share capital, can not become a part of ESPS
    • _x000D_

    _x000D_

    In case of ESPS, lock-in-period shall be one year from the date of allotment. If the ESPS is a part of public issue andthe shares are issued to employees at the same prices as in the public issue, the shares issued to employees pursuant to ESPS shall not be subject to any lock-in-period.

Leave an answer

Sorry, you do not have a permission to answer to this question .