HSBC 2005 Annual Report Download - page 194

HSBC HOLDINGS PLC
Report of the Directors (continued)
192
of the year of grant) are granted options to acquire
HSBC Holdings ordinary shares. Employees may
make contributions of up to £250 (or equivalent)
overall each month over a period of three or five
years which may be used on the third or fifth
anniversary of the commencement of the relevant
savings contract, at their election, to exercise the
options; alternatively the employee may elect to
have the savings (plus interest) repaid in cash. The
options are 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.
Following approval at the 2005 Annual General
Meeting, the HSBC Holdings Savings-Related Share
Option Plan: International will offer the choice of
options over one year in addition to the existing
three and five year terms. Employees will also be
able to save and have option prices expressed in US
dollars, Hong Kong dollars or euros. Options granted
over a one-year period will be exercisable within
three months following the first anniversary of the
commencement of the 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 granted under the US sub-plan
where a 15 per cent discount will be applied). The
all-employee share 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
Date of
award
Exercise
price (£)
Exercisable
from1
Exercisable
until2
Options at
1 January
2005
Options
awarded
during year3
Options
exercised
during year4
Options
lapsed
during year
Options at
31 December
2005
1 Apr 1999 5.3980 1 Aug 2004 31 Jan 2005 199,542 – 166,335 33,207 –
10 Apr 2000 6.0299 1 Aug 2005 31 Jan 2006 10,085,436 – 9,722,684 204,222 158,530
11 Apr 2001 6.7536 1 Aug 2004 31 Jan 2005 68,525 – 42,156 26,369 –
11 Apr 2001 6.7536 1 Aug 2006 31 Jan 2007 3,728,076 – 186,369 213,351 3,328,356
2 May 2002 6.3224 1 Aug 2005 31 Jan 2006 1,474,971 – 1,393,516 49,678 31,777
2 May 2002 6.3224 1 Aug 2007 31 Jan 2008 4,212,972 – 125,068 281,882 3,806,022
23 Apr 2003 5.3496 1 Aug 2006 31 Jan 2007 7,878,002 – 303,561 693,981 6,880,460
23 Apr 2003 5.3496 1 Aug 2008 31 Jan 2009 13,049,424 – 236,973 1,021,175 11,791,276
21 Apr 2004 6.4720 1 Aug 2007 31 Jan 2008 4,255,200 – 70,818 634,349 3,550,033
21 Apr 2004 6.4720 1 Aug 2009 31 Jan 2010 6,327,198 – 43,850 554,868 5,728,480
24 May 2005 6.6792 1 Aug 2008 31 Jan 2009 – 4,779,913 1,631 195,390 4,582,892
24 May 2005 6.6792 1 Aug 2010 31 Jan 2011 – 5,890,418 568 136,735 5,753,115
1May be advanced to an earlier date in certain circumstances, e.g. retirement.
2May be extended to a later date in certain circumstances, e.g. on the death of a participant the executors may exercise the option up to
six months beyond the normal exercise period.
3The closing price per share on 23 May 2005, the day before the options were awarded, was £8.68.
4The weighted average closing price of the shares immediately before the dates on which options were exercised was £9.15.