Vtech 2005 Annual Report Download - page 50

Notes to the Financial Statements
48 VTech Holdings Ltd Annual Report 2005
19 Share Capital, Share Options and Warrants
(continued)
Share Options (continued)
(i) The 2001 Scheme (continued) Pursuant to the Chapter 17
of the Listing Rules, the Company can issue options so that
number of shares that may be issued upon exercise of all
options to be granted under the schemes does not in aggregate
exceed 10% of the relevant class of shares in issue from time to
time. The Company may renew this limit at any time, subject to
shareholders’ approval and the issue of a circular. The Company
may also seek separate shareholders’ approval for granting
options beyond the 10% limit to eligible employees specifically
identified by the Company, subject to shareholders’ approval
and the issue of a circular. The Company can issue options so
that shares to be issued upon exercise of all outstanding
options does not exceed 30% of the relevant class of shares in
issue from time to time. The maximum entitlement for any one
eligible employee is that the total number of shares issued and
to be issued upon exercise of options granted and to be
granted in any 12-month period up to the date of the last grant
does not exceed 1% of the relevant class of shares in issue. The
Company can grant further options in excess of this limit,
subject to shareholders’ approval (with that eligible employee
and his associates abstaining from voting) and the issue of a
circular. The offer of a grant of options may be accepted within
30 days from the date of offer, upon payment of a non-
refundable sum of HK$1.0 by the grantee. The 2001 Scheme has
a life of 10 years and will expire on 9th August 2011.
Pursuant to the Listing Rules, the subscription price payable for
each share under the 2001 Scheme shall be at least the highest
of (i) the closing price of the shares as stated in the daily
quotation sheets of the Hong Kong Stock Exchange on the date
on which an offer is made, which must be a business day; and
(ii) the average closing price of the shares as stated in the daily
quotation sheets of the Hong Kong Stock Exchange for the five
business days immediately preceding the date on which an
offer is made; and (iii) the par value of the shares. The closing
price of the Company’s shares traded on the Hong Kong Stock
Exchange respectively on 19th April 2004 was HK$14.95 per
share, on 18th November 2004 was HK$10.70 per share and on
22nd March 2005 was HK$11.50 per share, all being the dates
immediately before the dates on which the relevant options
were granted.
The directors are of the view that value of options granted
during the period depends on a number of variables which are
either difficult to ascertain or can only be ascertained subject to
a number of theoretical basis of speculative assumptions.
Accordingly, the directors believe that any calculation of the
value of options will not be meaningful and may be misleading
to shareholders.
As at 31st March 2005, the number of shares issuable under the
options granted pursuant to the 2001 Scheme was 15,520,000,
which represented approximately 6.9% of the then issued share
capital of the Company. The movements in the number of
share options under the 2001 Scheme during the year were
as follows:
Number of Number of Number of
share options share options share options
Balance in granted exercised lapsed Balance in
Exercise issue at during during during issue at
Date of grant price Exercisable period 1st April 2004 the year the year the year 31st March 2005
(Note 1) (Note 2) (Note 6)
26th February 2002 to HK$10.2 26th February 2005 to 14,360,000 ——(4,715,000) 9,645,000
26th March 2002 25th March 2007
10th July 2002 to HK$8.71 10th July 2005 to 1,340,000 ——(580,000) 760,000
8th August 2002 7th August 2007
20th April 2004 to HK$15.0 20th April 2007 to —2,670,000 —(535,000) 2,135,000
19th May 2004 19th May 2009 (Note 3)
19th November 2004 HK$11.03 22nd November 2007 to —1,500,000 ——1,500,000
21st November 2009 (Note 4)
23rd March 2005 to HK$11.41 23rd March 2008 to —1,480,000 ——1,480,000
22nd April 2005 22nd March 2010 (Note 5)
15,700,000 5,650,000 —(5,830,000) 15,520,000