SEBI clarified that invoking pledged shares for Employee Stock Option Plans (ESOP) during a closure period may be considered valid, aligning it with regular trading transactions.
SEBI Allows Pledged Shares for ESOP Funding During Trading Window Closure
This clarification aims to assist companies in navigating the constraints posed by contra trade restrictions, which may apply within a specified six-month period post-invocation.
Legal professionals overseeing ESOP implementations should educate their clients on the implications of this guidance, thereby enhancing compliance with both trading norms and employee benefit plans.
Citations
- SEBI Guidance (2026)
