HSBC 2005 Annual Report Download - page 274

HSBC HOLDINGS PLC
Notes on the Financial Statements (continued)
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The weighted average fair value of options granted in the year as at the date of grant was US$3.76 (2004: US$3.75).
The exercise price range and weighted average remaining contractual life for options outstanding at the balance sheet
date, were as follows:
2005 2004
Exercise price range (£)..................................................................................................................... 5.35 - 6.75 5.35 - 6.75
Weighted average remaining contractual life (years) ........................................................................ 1.89 1.82
Of which exercisable:
Number (000’s) ............................................................................................................................ 772 1,341
Weighted average exercise price (£) ............................................................................................. 6.09 6.20
HSBC Holdings Restricted Share Plan 2000
Performance Share awards made under the HSBC Holdings Restricted Share Plan 2000
Performance Share awards under the Restricted Share Plan were granted to Senior Executives from 1996 to 2004.
The aim of the plan was to align the interests of executives to the creation of shareholder value. This was achieved by
setting certain Total Shareholder Return targets against a peer group of major banks which must normally be attained
in order for the awards to vest. No further awards will be made under this Plan following adoption of the HSBC
Share Plan in 2005 other than from reinvested scrip dividends.
2005 2004
Number Number
(000’s) (000’s)
Outstanding at 1 January ................................................................................................................ 17,044 13,669
Additions during the year1 .............................................................................................................. 710 5,727
Released in the year ........................................................................................................................ (2,455) (2,352)
Forfeited in the year ........................................................................................................................ (329) –
Outstanding at 31 December .......................................................................................................... 14,970 17,044
1Additions during the year include reinvested scrip dividends. Additions during the year also include 321,279 shares awarded to
employees of HSBC Holdings.
The weighted average remaining vesting period as at 31 December 2005 was 2.14 years (2004: 2.52 years).
Restricted share awards made under the HSBC Holdings Restricted Share Plan 2000 (‘Achievement Shares’)
Achievement shares are utilised to promote widespread interest in HSBC shares among employees and to help foster
employee engagement. They are awarded to eligible employees after taking into account the employee’s performance
in the prior year. Shares are awarded without corporate performance conditions and are released to employees after
three years providing the employees have remained continuously employed by HSBC for this period. During 2005,
10,245 employees each received an average award of 1,146 shares under this scheme.
Number of
shares
(000’s)
Additions during the year1 ............................................................................................................................................... 11,741
Forfeited in the year ......................................................................................................................................................... –
Outstanding at 31 December ........................................................................................................................................... 11,741
1Additions during the year include reinvested scrip dividends. Additions during the year also include 384,797 shares awarded to
employees of HSBC Holdings.
The weighted average fair value of shares awarded by HSBC for Achievement Share Awards in 2005 was US$15.88.