Growth Limited has designed an Employee Stock Option Scheme and has formed a trust for the purpose of executing the scheme. The Company seeks your advice on the conditions to be complied for providing necessary funds to

Rule 16 of the Companies (Share Capital and Debentures) Rules, 2014 provides for the following conditions to be complied with when a company wants to provide funds to the trust for purchasing the shares of the Company for the purpose of ESOP- a. The scheme for the provision of money for purchase of or subscriptions of shares is approved by the members by passing a special resolution. b. Such purchase of shares shall be made only through recognized stock exchange in case the shares are listed and not by way of private offers or arrangements. c. Where shares of the company are not listed, the valuation at which shares are to be purchased shall be made by registered valuer. d. The value of shares to be purchased or subscribed in the aggregate together with the money provided by the company shall not exceed 5% of the aggregate paid-up share capital and free reserves of the company. e. The explanatory statement to be annexed to the notice of the meeting for passing special resolution shall contain particulars of the class of employees for whose benefits the scheme is being implemented and the particulars of the trustee or employees in whose favour such shares are to be registered.