In today’s global business landscape, corporate seeks to retain and incentivize talent by rolling out equity based inventive programs. Of these, employee stock option plans and other similarly structured benefits have proved effective in enabling employees to partake in their employer’s success. Such employee benefits programs have become commonplace in India. Indian companies typically roll out programs which may be structured either as traditional stock options (i.e., whereby options once vested may be exercised to acquire shares of the employer) or other equity linked benefits such as stock appreciation rights (i.e., whereby employees benefit from increase in share price / value over a specified duration).
In cases where global conglomerates have their parent company’s securities listed (or where such securities are proposed to be listed) on overseas stock exchanges, often such employee benefit schemes are rolled out at a global level whereby employees of the subsidiaries are given an opportunity to participate in an employee share offering of their employer’s ultimate parent. Participation of an employees of an Indian subsidiary in such an offering entails an additional layer of complexity on account of exchange control regulations governing such overseas investments.
Please click here or refer to the below document to read the full article by Ronak Ajmera, published in The Jurisprudence.
Ronak specializes in the areas of domestic and cross-border mergers and acquisitions, corporate and business restructuring, carve-out transactions, private equity, strategic investments, fund-raises, joint ventures, technical collaborations and India entry advice.