Mini Ltd., a listed company, comes out with issue of shares through ESOS. As a Company Secretary, how would you deal with the following issues: (i) Suresh is an employee on a contract basis. His contract is renewed every

(i) Suresh is an employee on a contract basis. His contract is renewed every year. Can he participate in ESOS? A person eligible to participate in the ESOS must be a Permanent employee of the company. In the given case, Suresh is not a permanent employee of Mini Ltd., hence he can not participate in ESOS. (ii) Lakshya, an employee, is granted option under ESOS by the company. He writes a letter to his friend Mukesh for transferring the offer. But he dies. With whom will the option vest? As the Option granted to an employee shall not be transferable to any person and No person other than the employee to whom the option is granted shall be entitled to exercise the option. Accordingly, writing a letter by Lakshya to his friend Mukesh for transferring the offer is not a valid. Further, in case of the death of the employee to whom option is granted, his legal heir inherits the rights. (iii) Akhil, a director and his wife Beena together hold more than 15% of the equity shares of the company. Can the director Akhil participate in ESOS? If a director who either by himself or through his relative or through any body corporate, directly or indirectly holds more than 10% of the outstanding equity shares of the company shall not be eligible to participate in the ESOS. In this case, Akhil along with his wife Beena together holds more than 15% of the equity share. Hence he is not eligible to participate in ESOS. (iv) The ESOS in Mini Ltd. is a part of public issue and the shares are issued to employees at the same price as in the public issue. What is the duration of the lock-in-period to which these shares are subject to? If ESOS is a part of the public issue and the shares are issued to employees at the same price as in the public issue, the shares issued to employees are not subject to any lock in period. Hence, in this case the lock in period is zero. (v) Anil has acquired shares under ESOS in Simi Ltd. Now, Mini Ltd. acquires Simi Ltd. fully. Mini Ltd. allots shares to Anil in lieu of shares which he has under ESOS in Simi Ltd. In Simi Ltd., he has undergone 5 months of lock-in-period. How many minimum months of lock-in-period he has to undergo in Mini Ltd.? There shall be a minimum period of one year between the grant of options and vesting of option. Provided that in a case where options are granted by a company under an ESOS in lieu of options held by the same person under an ESOS in another company which has merged or amalgamated with the first mentioned company, the period during which the options granted by the transferor company were held by him shall be adjusted against the minimum vesting period required under this clause. In this case, lock in period already undergone is 5 Months. Hence, Anil has to undergo a minimum 7 months of Lock in Period in Mini Ltd.