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If a Company has granted stock options prior to the promulgation of the Companies Act, 2013, then whether such stock options can be exercisable by the Independent Directors?

If a Company has granted stock options prior to the promulgation of the Companies Act, 2013, then whether such stock options can be exercisable by the Independent Directors?

They can exercise the stock options prior to the commencement of the Companies Act, 2013; however, they shall not be entitled to have any stock option after the commencement of Companies Act, 2013.

If a Company has granted stock options prior to the promulgation of the Companies Act, 2013, then whether such stock options can be exercisable by the Independent Directors?

As per section 197(7), section 62(1)(b) and Rule 12 of the Companies (Share Capital and Debentures) Rule, 2014, an Independent Director has been disentitled to any stock option but the Independent Directors have not been prohibited to exercise the stock options which were granted to them before Companies Act, 2013. Therefore, they can exercise the stock options granted to them prior to the commencement of the Companies Act, 2013; however, they shall not be entitled to
have any stock option after the commencement of Companies Act, 2013.


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