Tesco 2000 Annual Report Download - page 38

TESCO PLC
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NOTE 25 Share options
Company schemes
The company had five principal share option schemes in operation during the year:
i The savings-related share option scheme (1981) permits the grant to employees of options in respect of ordinary shares linked to a building
society/bank save-as-you-earn contract for a term of three or five years with contributions from employees of an amount between £5 and
£250 per month. Options are capable of being exercised at the end of the three and five year period at a subscription price not less than 80%
of the middle market quotation of an ordinary share immediately prior to the date of grant.
ii The executive share option scheme (1984) permitted the grant of options in respect of ordinary shares to selected executives. The scheme
expired after ten years on 9 November 1994. Options were generally exercisable between three and ten years from the date of grant at a
subscription price determined by the Board but not less than the middle market quotation within the period of 30 days prior to the date of
grant. Some options have been granted at a discount of 15% of the standard option price but the option holder may take advantage of that
discount only if, in accordance with investor protection ABI guidelines, certain targets related to earnings per share are achieved.
iii The executive share option scheme (1994) was adopted on 17 October 1994. The principal difference between this scheme and the previous
scheme is that the exercise of options will normally be conditional upon the achievement of a specified performance target related to the
annual percentage growth in earnings per share over any three year period. There will be no discounted options granted under this scheme.
iv The unapproved executive share option scheme (1996) was adopted on 7 June 1996. This scheme was introduced following legislative
changes which limited the number of options which could be granted under the previous scheme. As with the previous scheme, the exercise
of options will normally be conditional upon the achievement of a specified performance target related to the annual percentage growth in
earnings per share over any three year period. There will be no discounted options granted under this scheme.
v The international executive share option scheme was adopted on 20 May 1994. This scheme permits the grant to selected non-UK executives
of options to acquire ordinary shares on substantially the same basis as their UK counterparts. Options are normally exercisable between
three and ten years from their grant at a price of not less than the average of the middle market quotations for the ordinary shares as derived
from the London Stock Exchange Daily Official List for the three dealing days immediately preceding their grant and will normally be
conditional on the achievement of a specified performance target determined by the Remuneration Committee when the options are
granted. There will be no discounted options granted under this scheme.
The company has granted outstanding options in connection with the five schemes as follows:
Savings-related share option scheme (1981)Number of Shares
executives and under option Subscription
Date of grant employees 26 Feb 2000 prices (pence)
22 October 1993 5 14,136 53.7
26 October 1994 1,903 5,513,787 61.7
27 October 1995 15,288 32,043,763 83.3
31 October 1996 12,943 30,222,135 83.0
30 October 1997 33,377 43,007,253 121.7
29 October 1998 51,763 63,999,669 136.0
28 October 1999 55,501 49,059,538 151.0
Executive share option scheme (1984)Shares
Number of under option Subscription
Date of grant executives 26 Feb 2000 prices (pence)
17 May 1991 4 60,000 91.3
29 May 1992 72 2,772,503 92.3
29 October 1992 2 78,663 72.3
27 May 1993 3 184,425 72.3
10 June 1994 137 3,117,726 70.0
12 August 1994 1 471,372 81.0
29 September 1994 9 346,242 77.3
notes to the financial statementscontinued