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Sebi Grade A 2020
Sebi Grade A 2020
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SEBI GRADE A 2020
WHAT IS EMPLOYEE STOCK OPTION PLAN (ESOP) ?
2. Vesting: It is the process by which the employee is given the right to apply for shares of the
company against the option granted to him in pursuance of employee stock option scheme.
3. Vesting Period: It is the time period between grant date and the date on which all the
specified vesting conditions of an employee share based payment plan are to be satisfied.
4. Option: Option means a right but not an obligation granted to an employee for a specified
period of time in pursuance of ESOS to purchase or subscribe to the shares of the company
at a pre-determined price.
SEBI GRADE A 2020
IMPORTANT TERMS TO BE REMEMBERED
5. Exercise Period: It is the time period after vesting within which the employee should exercise his
right to apply for shares against the option vested in him in pursuance of the ESOS.
6. Exercise Price: It is the price payable by the employee for exercising the option granted to him
in pursuance of ESOS.
7. Intrinsic Value: It is the excess of the market price of the share under ESOS over the exercise
price of the option (including up-front payment, if any). {Market Price – Exercise Price}
8. Fair Value: It is the amount for which stock option granted or a share offered for purchase
could be exchanged between knowledgeable, willing parties in an arm's length transaction
SEBI GRADE A 2020
IMPORTANT TERMS TO BE REMEMBERED
Under the Companies Act 2013, there shall be a minimum period of one year between grant
of options and vesting of options, hence the exercise period cannot be less than one year from
the date of grant of option.
For accounting purposes, employee share-based payment plans are classified into the
following categories:
Mr. Nilay (AIR-2 NABARD GRADE B 2019) Mr. Prashant (AIR-2 NABARD GRADE B 2019)
Mr. Akshay [AIR-1 (OBC)] Mr. Praveen (AIR-21) Mr. Rashmiranjan (AIR-57)
Mr. Anuvesh (AIR-32)
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