Employee stock options are frequently used as an employee incentivisation and retention tool, given the benefit accrued over time. An ESOP-wrapped compensation is attractive because the gains from the shares acquired on exercise of employee stock options are much higher than the exercise price paid for the options. While the maximum or minimum price payable on exercise of the options is not prescribed by the law – which only lays down the requirement for the price to be accounting-standard compliant – the price typically ranges from the face value of the share to the fair market value of the share.Continue Reading ESOP: Has SEBI Put an End to ‘Sell All’ Method of Cashless Exercise?
Srishti Aishwarya
Principal associate in the General Corporate Practice at the Bangalore office of Cyril Amarchand Mangaldas. Srishti advises on foreign investment, general corporate advisory specializing in employee stock options, executive appointment and structuring strategic exits for key managerial personnel. She can be reached at srishti.aishwarya@cyrilshroff.com