Sanaya Ltd. (a listed company) wants to implement Sweat Equity shares scheme for its employees. The company is also willing to issue shares under the scheme to one its whole-time director 'Jeevan'. Jeevan holds 21% of th

As per Regulation 29 of the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the term 'employee' in relation to issue of sweat equity shares means, an employee of the company working in India or abroad; or a director of the company whether a whole- time director or not. Further, Regulation 30 of the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 states that a company whose equity shares are listed on a recognised stock exchange may issue sweat equity shares in accordance with Section 54 of the Companies Act, 2013 and these regulations to its employees for their providing know-how or making available rights in the nature of intellectual property rights or value additions, by whatever name called. In light of the above-mentioned provisions, Sweat Equity Shares can be issued to any director, whether whole-time or not and there is no threshold for holding any equity shares of the company. Hence, Jeevan, who is a whole-time director and who holds 21% of the outstanding equity shares of Sanaya Ltd, is eligible for Sweat Equity Shares of Sanaya Ltd. According to the Regulation 41 of the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the company, within seven days of the issue of sweat equity shares, sends a statement to the recognised stock exchange, disclosing: number of sweat equity shares issued; price at which the sweat equity shares are issued; total amount received towards sweat equity shares; details of the persons to whom sweat equity shares have been issued; and the consequent changes in the capital structure and the shareholding pattern before and after the issue of sweat equity shares.