SCHEDULES

SCHEDULE 4Approved CSOP schemes

Part 5Requirements etc. relating to share options

21Requirements etc. relating to share options: introduction

1

A CSOP scheme must meet the requirements of—

  • paragraph 22 (requirements as to price for acquisition of shares), and

  • paragraph 23 (share options may not be transferred).

2

A CSOP scheme may make any provision authorised by—

  • paragraph 24 (exercise of options: ceasing to be director or employee), or

  • paragraph 25 (exercise of options: death).

22Requirements as to price for acquisition of shares

1

The price at which shares may be acquired by the exercise of a share option granted under the scheme—

a

must be stated at the time when the option is granted, and

b

must not be manifestly less than the market value of shares of the same class at that time.

This is subject to sub-paragraphs (2) and (3).

2

The Inland Revenue and the scheme organiser may agree in writing that sub-paragraph (1)(b) is to apply as if the reference to the time when the option is granted were to an earlier time or times stated in the agreement.

3

The scheme may provide for one or more of the following—

a

the price at which shares may be acquired by the exercise of a share option granted under the scheme,

b

the number of shares which may be so acquired, or

c

the description of shares which may be so acquired,

to be varied so far as necessary to take account of a variation in the share capital of which the shares form part.

4

But the scheme must provide that no such variation is to be made without the prior approval of the Inland Revenue.

23Share options must not be transferable

1

The scheme must ensure that share options granted to a participant are not capable of being transferred by the participant.

2

Paragraph 25 provides for the exercise of the options where the participant has died.

24Exercise of options: ceasing to be director or employee

1

The scheme may provide that an individual may exercise share options under it after ceasing to be a full-time director or qualifying employee.

2

“Qualifying employee” has the same meaning as in paragraph 8 (the employment requirement).

25Exercise of options: death

The scheme may provide that, if a participant dies before exercising the options, they may be exercised on or after the date of death but not later than 12 months after that date.