Esops

In a big relief to startup founders looking to go public, Sebi has amended rules allowing them to retain Employee Stock options (ESOPs) granted at least one year before filing preliminary IPO (initial pubic offering) papers. "An employee who is identified as a 'promoter' or part of the 'promoter group' in the draft offer document filed by a company with the Board in relation to an IPO, and who was granted options, SAR (Stock Appreciation Rights) or any other benefit under any scheme at least one year prior to filing of the draft offer document, shall be eligible to continue to hold and/or exercise such options, SAR or any other benefit," Sebi said in a notification made public on Tuesday. The new rule would facilitate founders who received ESOPs at least one year before the filing of draft papers to continue holding or exercising such benefits even after being specified as the promoter and the company becoming a listed entity. Under the existing regulations, promoters are ineligible

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The clarifications regarding the issuance of employee stock ownership plans (Esops) in startups have brought relief to founders

The ease in norms from the Securities and Exchange Board of India (Sebi) comes at a time when multiple Indian startups such as PhonePe, Zepto, Pine Labs

Sebi allows ESOP, convertible security holding at DRHP stage, relaxes PSU delisting, FPI norms; proposes fee transparency, simplifies documents for investors

The move addresses a long-standing concern under existing rules, which bar promoters from holding share-based benefits like ESOPs and require them to liquidate such holdings before the IPO

Startups with diluted founder stakes seek Sebi's nod to issue Esops post-listing as they look to retain leadership alignment and reward long-term value creation

Vijay Shekhar Sharma and One97 Communications settle Sebi case on Esop violations with penalties and a three-year ban on accepting stock options from listed firms

Consequently, last month, Sharma had foregone these ESOPs and as a result, Paytm took a related ₹492 crore one-time charge in the previous quarter

Furthermore, with a projected revenue growth of 20 per cent in FY 2024-25, this initiative would empower team members to build personal wealth while growing with the organisation, the company believes

The company said the move will result in a "one-time, non-cash, acceleration of ESOP expense of Rs 492 crore in the fourth quarter of financial year 2025 (Q4FY25)

The payments fintech is currently in the process of reverse flipping from the United States (US) to India. The firm expects to complete the domicile shift sometime in 2025

On the Bombay Stock Exchange (BSE), the stock opened at Rs 412, registering a 5.64% gain from the issue price. This listing is set to bring significant value through Esops

The Esop grants have a vesting period ranging from one to eight years, meaning that the actual value of the stock awards will depend on Swiggy's performance post-IPO

This is the eleventh edition of the IT major's employee share ownership plan after the previous one from 2019 is set to expire at the end of the year

Congress spokesperson Pawan Khera on Tuesday issued a statement questioning ICICI Bank's explanation over retirement benefits allegedly received by Sebi Chief Madhabi Puri Buch