HSBC 2009 Annual Report Download - page 322

HSBC HOLDINGS PLC
Report of the Directors: Governance (continued)
Employees / Share plans
320
the Earnings per share Note 13 on the Financial
Statements.
All-employee share option plans
The HSBC Holdings Savings-Related Share Option
Plan and the HSBC Holdings Savings-Related Share
Option Plan: International are all-employee share
plans under which eligible HSBC employees (those
employed within the Group on the first working day
of the year of grant) may be granted options to
acquire HSBC Holdings ordinary shares. Employees
may make contributions of up to £250 (or
equivalent) each month over a period of one, three or
five years which may be used on the first, third or
fifth anniversary of the commencement of the
relevant savings contract, at the employee’s election,
to exercise the options. Alternatively, the employee
may elect to have the savings, plus (where
applicable) any interest or bonus, repaid in cash.
Options granted over a one-year period are only
available under the HSBC Holdings Savings-Related
Share Option Plan: International and will be
exercisable within three months following the first
anniversary of the commencement of the savings
contract. Options granted over three or five-year
periods will be exercisable within six months
following the third or fifth anniversary of the
commencement of the relevant savings contract. In
the case of redundancy, retirement on grounds of
injury or ill health, retirement at or after normal
retirement age, the transfer of the employing
business to another party, or a change of control of
the employing company, options may be exercised
before completion of the relevant savings contract.
Under the HSBC Holdings Savings-Related
Share Option Plan and the HSBC Holdings Savings-
Related Share Option Plan: International the option
exercise price is determined by reference to the
average market value of the ordinary shares on the
five business days immediately preceding the
invitation date, then applying a discount of
20 per cent (except for the one-year options awarded
under the US sub-plan where a 15 per cent discount
is applied). Where applicable, the US dollars, Hong
Kong dollars and euro exercise prices are converted
from the sterling exercise price at the applicable
exchange rate on the working day preceding the
relevant invitation date. The exercise period of the
options awarded under all-employee share plans may
be advanced to an earlier date in certain
circumstances, for example on retirement, and may
be extended in certain circumstances, for example on
the death of a participant, the executors may exercise
the option up to six months beyond the normal
exercise period. The closing price per HSBC
Holdings ordinary share on 28 April 2009, the day
before options were awarded in 2009 under the
HSBC Holdings Savings-Related Share Option Plan
and the HSBC Holdings Savings-Related Share
Option Plan: International, was £4.57. The all-
employee share option plans will terminate on
27 May 2015 unless the Directors resolve to
terminate the plans at an earlier date.
HSBC Holdings Savings-Related Share Option Plan
HSBC Holdings ordinary shares of US$0.50
Exercise price (£)
Exercisable Date of
award
At
1 Jan
2009
At
31 Dec
20091 from until
At
1 Jan
2009
Adjustment
for rights
issue
Awarded
during
year
Exercised
during
year2
Lapsed
during
year
At
31 Dec
2009
23 Apr 2003 5.3496 4.6618 1 Aug 2008 31 Jan 2009 371,318 5,203 –
153,737 222,784 –
21 Apr 2004 6.4720 5.6399 1 Aug 2009 31 Jan 2010 4,647,894 610,947 –
2,713,037 846,201 1,699,603
24 May 2005 6.6792 5.8205 1 Aug 2008 31 Jan 2009 200,358 4,384 –
13,355 191,387 –
24 May 2005 6.6792 5.8205 1 Aug 2010 31 Jan 2011 4,550,403 550,913 –
21,802 2,781,386 2,298,128
26 Apr 2006 7.6736 6.6870 1 Aug 2009 31 Jan 2010 3,159,428 395,653 –
533,470 804,188 2,217,423
26 Apr 2006 7.6736 6.6870 1 Aug 2011 31 Jan 2012 2,636,893 319,896 –
2,782 1,791,103 1,162,904
25 Apr 2007 7.0872 6.1760 1 Aug 2010 31 Jan 2011 4,705,656 529,574 –
11,212 3,598,098 1,625,920
25 Apr 2007 7.0872 6.1760 1 Aug 2012 31 Jan 2013 3,554,943 418,019 –
3,608 2,619,335 1,350,019
30 Apr 2008 6.8160 5.9397 1 Aug 2011 31 Jan 2012 6,733,293 756,995 – 6,097 5,449,347 2,034,844
30 Apr 2008 6.8160 5.9397 1 Aug 2013 31 Jan 2014 5,947,860 694,867 – 2,221 4,855,816 1,784,690
29 Apr 2009 – 3.3116 1 Aug 2012 31 Jan 2013 – – 32,960,627 3,273 1,028,614 31,928,740
29 Apr 2009 – 3.3116 1 Aug 2014 31 Jan 2015 – – 31,053,247 1,141 588,049 30,464,057
1 The exercise price of awards granted prior to 2009 adjusted for rights issue.
2 The weighted average closing price of the shares immediately before the dates on which options were exercised was £6.78.