Red Hat, which is looking to double its revenues and employee headcount, plans to offer an employee stock purchase plan as an incentive to keep current workers as well as to attract new ones.

Red Hat, which is based in Raleigh, disclosed the so-called ESPP in an SEC filing on Thursday as part of a notice regarding the company’s annual shareholders meeting which is set for Aug. 11.

Red Hat also disclosed that Chief Executive Officer Jim Whitehurst made more than $12 million in total compensation last year. The world’s largest open source software developer and services provider reported its latest earnings earlier this week, noting that revenues jumped 18 percent year-over-year.

Whitehurst has said he wants to double Red Hat revenues to $5 billion. Such a growth also would require an estimated doubling of the company’s work force.

Under the plan, Hatters would be eligible to purchase Red Hat stock at a discounted price.

More than 3,800 current Red Hat employees would be eligible to buy stock, according to the filing.

Red Hat plans to offer 5 million shares through the ESPP, assuming it is approved by shareholders.

“Attracting, retaining and motivating talented employees”

In an email, Chief People Officer DeLisa Alexander, explained the Red Hat (NYSE: RHT) plan:

“Hello Red Hatters,

“Included in our proxy statement filed earlier today with the SEC is a proposal to our shareholders to consider approval of an Employee Stock Purchase Plan (ESPP). If you don’t know, an ESPP is a benefit offered by some U.S. companies that typically allows participating employees to purchase the company’s stock at a discount through payroll deductions.”

She added that the company plans to “provide more information in late August and appreciate your patience until that point.”

The decision to offer the discounted stock was made by Red Hat’s board earlier this month.

“The ESPP is intended to benefit the Company and our stockholders by attracting, retaining and motivating talented employees, which we believe to be critical for our success, and aligning the interests of participating employees with those of our stockholders,” the company said.

“We believe that the ability to participate in our ESPP is an attractive benefit for current and potential employees by affording employees the opportunity to share in the growth and success of the Company.

“The ESPP also helps to attract and retain employees because employee stock purchase plans are commonly offered by our peers and other industry leaders. To further encourage stock ownership among our employees while providing our employees a benefit that is common in the companies with which we compete for talent, our Board has adopted the ESPP.”

Eligibility requirements

So who can cash in on the deal?

“Employees of the Company and any subsidiary of the Company designated by our Board or the Committee, which we refer to as a Designated Subsidiary, are eligible to participate provided that they work more than twenty (20) hours per week and for more than five (5) months in a calendar year, have been employed for such minimum period of time as is provided in the Plan Guidelines (which period may not be greater than two (2) years), and are employees on the first day of the applicable offering period.,” Red Hat said.

“No employee can be granted an option under the ESPP that would, immediately after the option is granted, result in the employee owning common stock and/or options to purchase common stock representing five percent or more of the total combined voting power or value of all classes of our outstanding capital stock.”

Read the full filing at:

https://www.sec.gov/Archives/edgar/data/1087423/000119312516630109/d204070ddef14a.htm#toc204070_14