“40000 shares issued to existing employees of a company as per their choice and option at the below price than the market price.”

What is the name of this kind of issued share?

ESOP

The correct answer is option 3- ESOP.

A company may offer option to its employees and employee directors to subscribe shares of the company at lower than its market value or fair value at a future date. It is known as Employees Stock Option Plan (ESOP). It being an option granted by the company, an employee may or may not exercise the right to subscribe. Employees Stock Option Plan falls in the category of Sweat Equity.