A company can issue shares to its employees as part of an Employee Stock Option Plan (ESOP) to retain and motivate talent. Such issuance must comply with the guidelines prescribed under the Companies Act, 2013. Below is a standard format of the Board Resolution for approving the issue of shares under ESOP.”

Board Resolution format for issue of shares through Employee Stock Option Plan (ESOP)

 To approval of Employees Stock Option Scheme

“RESOLVED THAT pursuant to the provisions of Section 62 and other applicable provisions, if any, of the Companies Act, 2013 read with rules made thereunder and applicable provisions [including any statutory amendment, modification or re-enactment to the Act or the Guidelines, for the time being in force], Foreign Exchange Management Act 1999 and Regulations issued thereunder, pursuant to the Memorandum and Articles of Association of the company and subject to approval of the member of the Company and such other approval(s), consent(s), permission(s), and / or sanction(s) as may be necessary from the appropriate regulatory authority(ies) / institution(s) and such conditions and notifications as may be prescribed / imposed by the appropriate regulatory authority(ies)/  institution(S) while granting such approval(s),  consent(s), permission(s)  and /or  sanction(s),  ‘_________ Employees  Stock  Option Scheme’ (hereinafter referred to as “the Scheme’) , copy of which is tabled before the meeting , be and is hereby approved and consent is hereby accorded to create , offer , grant , issue and allot under the Scheme , in one or more tranches , a maximum of ________ (_______) options (or such other adjusted figure for any bonus ,  stock splits or consolidations or ther reorganization of the capital structure of the Company as may be applicable from time to time) exercisable into ______ (_______) equity shares of face value Rs ___/- each (or such other adjusted figure for any bonus , stock or consolidations or other reorganization of the capital structure of the Company as may be applicable from time to time) to or for the benefit of to such employees of the Company , its Holding Company and Subsidiary Company as mentioned in the Scheme , in one or more tranches;

 "RESOLVED FURTHER THAT the new Equity Shares to be issued and allotted by the Company in the manner aforesaid shall rank pari passu in all respects with the then existing Equity Shares of the Company.

"RESOLVED FURTHER THAT an Extraordinary General Meeting of the Company be called and held at ________ on_______ day of ________ at _________ as per the draft notice and explanatory statement placed before the meeting duly initialed by the Chairperson for identification;

"RESOLVED FURTHER THAT Mr./Ms. _______ of M/s _______, [Practicing Company  Secretaries / Practicing  Chartered  Accountant/  Practicing  Cost Accountant/ Advocate], who has given his consent to act as Scrutinizer , be and is hereby appointed as Scrutinizer for the e-voting and voting and voting through ballot at the General Meeting at such remuneration and out of pocket expenses, as may be determined by ________ [Director];

"RESOLVED FURTHER THATthe consent be and is hereby accorded to avail the services of ________

 [Electronic Voting Agency] for the purpose of conducting the electronic voting at such fees, as may be determined by ________ [Director];

"RESOLVED FURTHER THATMr./ Ms. _________ [name], ______ [Director/CS] of the Company be and is hereby authorized to issue the said notice to the members and other who are entitled for the same, and take all necessary action in this respect;

"RESOLVED FURTHER THAT Mr./Ms. _________ [name]_______ [director/ CFO/ CS] and Mr./Ms. _________ [name]_______ [director/ CFO/ CS] of the Company be and are hereby jointly/severally authorized to take such steps as may be necessary and to settle all matters arising out of and incidental thereto and sign and execute all deeds, applications, documents and writings that may be required, on behalf of the Company and generally to do all acts, deeds and things that may be necessary, proper, expedient or incidental for the purpose of giving effect to the aforesaid resolution.”

//Certified True Copy//

For ________________

____________

Director

DIN: ________

Address: ____________

Date:

Place: