Answer the following with reference to SEBI Insider Trading Regulations by giving reasons: Does exercise of ESOPs/ESPS come under the definition of Trading under the Insider Trading Regulations?

As per the SEBI (Prohibition of Insider Trading) Regulations, 2015, "Trading" means and includes subscribing, buying, selling, dealing, or agreeing to subscribe, buy, sell, deal in any securities, and "trade" shall be construed accordingly. No insider shall trade in securities that are listed or proposed to be listed on a stock exchange when in possession of unpublished price sensitive information. However, the insider may prove his innocence by demonstrating the circumstance that the transaction in question was undertaken pursuant to the exercise of stock options in respect of which the exercise price was pre-determined in compliance with applicable regulations. Therefore, exercise of ESOP's/ESPS shall not be considered to be "trading" except for the purposes of Chapter III of the SEBI (Prohibition of Insider Trading) Regulations, 2015 i.e. except for the disclosures requirements under the SEBI (Prohibition of Insider Trading) Regulations, 2015.