True. Issuing shares in a company to employees involves securities and may subject the company to compliance requirements under securities laws.
How to explain
The issuance of shares is considered a securities transaction, and regulations govern such transactions to protect investors' interests and ensure fair and transparent markets.
Failure to comply with securities laws can result in legal consequences, penalties, and liabilities for the company and its executives. It's essential to adhere to the specific regulations and requirements outlined by securities laws when issuing shares to employees or any other parties to avoid noncompliance issues.