Regulation 17I - Manner of receiving units by the employee benefit trust - Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014

1 [Manner of receiving units by the employee benefit trust. 17I. (1) The employee benefit trust may receive units of the InvIT in the following manner for the purpose of offering unit based employee benefit scheme: (a) The investment manager may receive the units of InvIT in lieu of management fees, through the employee benefit trust, only for the limited purpose of providing unit based employee benefit on such units; Explanation. For the above purpose, the investment manager may take full or part of the management fees in the form of units of InvIT. (b) A shareholder of investment manager may transfer full or part of the units of InvIT held by it to the employee benefit trust: Provided that in case a sponsor is also a shareholder of the investment manager, then the sponsor group and associate of the sponsor may also transfer full or part of the units held by them to the employee benefit trust; (c) The investment manager may transfer full or part of the units of InvIT held by it to the employee benefit trust; Explanation. For the purpose of clauses (b) and (c), any transfer of units to the employee benefit trust shall be irrevocable and without any consideration in return i.e. shall constitute a gift to the employee benefit trust. (2) Subordinate units shall not be eligible for being transferred to the employee benefit trust or being made part of a unit based employee benefit scheme. (3) The cash accumulated by the employee benefit trust on account of distributions received on units of the InvIT held by such trust, income earned on the assets held by the employee benefit trust and receipt of exercise price from the employees of the investment manager on exercise of options, may be used by the employee benefit trust for acquiring units of the InvIT either from the secondary market or during any fresh issuance of units by the InvIT only for the purpose of using such units for unit based employee benefit scheme. (4) The employee benefit trust may subscribe to the units of the InvIT subject to compliance with the minimum lot for primary market transaction specified under these regulations: Provided that the minimum trading lot specified under these regulations shall not be applicable for vesting of units of a privately placed InvIT in employees of the investment manager and exercised by them: Provided further that in case of a privately placed InvIT, the employees of the investment manager may sell an odd lot quantity of the units vested upon them, in off-market transaction(s). ] ************** NOTES:- 1. Inserted vide Notification No. SEBI/LAD-NRO/GN/2024/192 dated 09-07-2024