EUROTELECOM COMMUNICATIONS, INC.
EMPLOYEE SHARE OPTION SCHEME
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TABLE OF CONTENTS
1 Definitions 1
PART A - APPROVED OPTIONS 4
2 Grant of Options 4
3 Rights to exercise Options 5
4 The Exercise of Options 7
5 Adjustment of Options 7
6 Administration 8
7 General 8
8 Alterations 8
PART B - UNAPPROVED OPTIONS 10
9 Grant of Unapproved Options 10
10 No Inland Revenue approval 10
11 Option Price 10
12 Limit of four times Relevant Remuneration 10
13 No(pound)30,000 limit 10
14 Eligibility 11
15 PAYE 11
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EUROTELECOM COMMUNICATIONS, INC.
EMPLOYEE SHARE OPTION SCHEME
(as adopted by Resolution of the Directors on 28 March 2000)
The purpose of this Scheme is to attract and retain and provide
share-related incentives to employees, directors and consultants of the
Group and to thereby increase overall shareholder value.
1 DEFINITIONS
1.1 In this Scheme, except where inconsistent with the subject or context,
words or expressions defined in or bearing a specific meaning for the
purposes of Schedule 9 to the Income and Corporation Taxes Act 1988 and
every statutory modification or re-enactment thereof or a relevant
provision thereof shall bear the same meaning, and the words and
expressions set out below shall bear the following respective meanings,
namely:
the Auditors the auditors for the time being of the
Company
the Company EuroTelecom Communications, Inc.
Date of Grant the date on which an Option is granted
the Directors the Board of Directors of the Company or a
duly authorised committee thereof (having at
least 2 members) to whom the Directors may
delegate their authority to operate this
Scheme (provided that all the members of any
such Committee must be Non-Employee
Directors)
Eligible Employee any Full-time director or any employee
(other than one who is a director) of any
member of the Group, but excluding any
Excluded Person
Equity Shares Ordinary Shares and any other class
of equity shares of common stock in the
Company which carries rights to participate
in the profits of the Company otherwise than
solely by way of dividends at a fixed rate
Excluded Person any person who has (or has within the
preceding 12 months had) a material interest
in the Company (if then a close company) or
a company which is a close company and
either controls the Company or is a member
of a consortium which owns the Company
and/or any person who is not resident in the
UK either at the date of grant or upon the
date of intended exercise of his Option (as
the case may be)
Full-time required to devote substantially the whole
of his working time to the business of the
Group and required under his terms of
service to work for his employing company
for no less than 25 hours per week
(excluding meal breaks)
the Group the Company and any Subsidiary designated by
the Directors as a member of the Group for
the purposes of this Scheme or, where the
context permits, any one or more of them
the London Stock Exchange London Stock Exchange Limited
Non-Employee Directors as defined in Rule 16b-3(b)(3)(i)
promulgated pursuant to the Securities
Exchange Act of 1934 of the United States
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Option a non-transferable right to acquire Ordinary
Shares granted to an Eligible Employee in
pursuance of this Scheme and for the time
being subsisting
Option Holder a person holding an Option or, where the
context requires or permits, his legal
personal representatives (but so that, in
the event of the insolvency of an Option
Holder, all his Options shall lapse)
Option Period a period of ten years commencing on the Date
of Grant of an Option
Option Price a price per Ordinary Share equal to
whichever shall be the greater of:
(a) its market value as at the Date of Grant
as determined:
(i) by the Directors by taking the
arithmetical average of its middle
market quotations as recorded in
the Daily Official List of the
London Stock Exchange on the three
dealing days preceding the related
Date of Grant if at that time the
Ordinary Shares are listed by the
London Stock Exchange, such average
to be rounded upwards to the
nearest pence; or
(ii) on any day when the Ordinary Shares
are not so listed or such middle
market quotations are not
available, the market value of an
Ordinary Share determined in
accordance with the provisions of
Part VIII of the Taxation of
Chargeable Gains Act 1992 and
agreed for the purposes of the
Scheme with the Inland Revenue
Shares Valuation Division on or
within 30 days before that day; and
(b) its par value;
or in either case (when applicable) such
price as from time to time adjusted pursuant
to this Scheme
Ordinary Shares shares of Class A common stock, par value
$0.01 per share, in the capital of the
Company which comply with the requirements
of paragraphs 10 to 14 of Schedule 9 to the
Taxes Act
Relevant Conditions objective and relevant conditions as to the
performance of the Company and/or the Option
Holder which:
(a) must be satisfied in order that an
Option granted to such Option Holder may
be exercised under all, any or some only
(as determined in the discretion of the
Directors prior to the related Date of
Grant) of the paragraphs of this Scheme
(including without limitation upon or in
consequence of a general offer under
paragraph 3.5);
(b) shall have been determined by the
Directors (if at all) on or prior to the
related Date of Grant; and
(c) shall be notified to the Option Holder
on his Option certificate by way of an
appendix thereto
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Relevant Event any variation in the share capital of the
Company arising from any reduction of
capital or sub-division or consolidation of
capital or issue of shares by way of
capitalisation of profits or reserves or by
way of rights (including in the latter case
an offer to holders of Ordinary Shares to
subscribe additional shares proportionately
to their existing shareholdings whether or
not such additional shares are provisionally
allotted on a nil paid basis)
this Scheme this Scheme in its present form or as from
time to time altered in accordance with the
provisions hereof
Subsidiary any company which is for the time being
under the control of the Company
the Taxes Act the Income and Corporation Taxes Act 1988 of
the United Kingdom
1.2 References to paragraphs are to paragraphs of this Scheme.
1.3 References in this Scheme to statutory provisions shall extend to any
statutory modification or re-enactment thereof.
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PART A - APPROVED OPTIONS
(AS APPROVED BY THE INLAND REVENUE ON 19 MAY 2000 REFERENCE X20607/PAM)
2 GRANT OF OPTIONS
2.1 Subject to the restrictions hereinafter contained, the Directors may
from time to time at their discretion and subject to such Relevant
Conditions as they may determine grant or procure that there is granted
to any Eligible Employee an Option to acquire Ordinary Shares at the
applicable Option Price.
2.2 Other than in circumstances considered by the Directors to be
exceptional, Options shall only be granted:
(a) within 42 days after the date of adoption of this Scheme; or
(b) within the 42 days next following the announcement of the
Company's final or interim results in respect of any financial
period.
2.3 No Option shall be granted after the tenth anniversary of the date of
adoption of this Scheme.
2.4 No Option shall be granted under this Scheme (either Part A or Part B)
if, as a result:
(a) the aggregate number of Ordinary Shares which might fall to be
or have already been issued within the preceding ten years
pursuant to grants or awards made following the quotation of
the Company's Ordinary Shares on the Alternative Investment
Market of the London Stock Exchange under all employee share
option or other employees' share schemes established by the
Company (excluding options granted under any savings related
share option scheme), would exceed 5% of the then issued and
outstanding Ordinary Shares; or
(b) the aggregate number of Ordinary Shares which might fall to be
or have already been issued within the preceding ten years
pursuant to grants or awards made following the quotation of
the Company's Ordinary Shares on the Alternative Investment
Market of the London Stock Exchange under all employee share
option or other employees' share schemes established by the
Company would exceed 10% of the then issued and outstanding
Ordinary Shares; or
(c) the aggregate number of Ordinary Shares which might fall to be
or have already been issued pursuant to grants or awards made
following the quotation of the Company's Ordinary Shares on
the Alternative Investment Market of the London Stock Exchange
under all employee share option or other employees' share
schemes established by the Company (other than any savings
related share option scheme) and granted in any three-year
period would exceed 3% of the then issued and outstanding
Ordinary Shares immediately before such grant.
2.5 No Option shall be granted under this Part A of this Scheme to an
Eligible Employee if the aggregate Option Price of the Ordinary Shares
comprised therein, when added to the aggregate of the market value of
shares which may be acquired under any subsisting Options granted to
him under this Part A of this Scheme or any other share option scheme
approved under Schedule 9 to the Taxes Act and established by the
Company or an associated company thereof (not being a savings-related
share option scheme and excluding, for the avoidance of doubt, part B
of this Scheme), would exceed, or further exceed, (pound)30,000 or such
other limit as may apply from time to time under paragraph 28 of
Schedule 9 to the Taxes Act. For the purposes of this rule, the market
value shall be as determined at the time of grant of the options under
the rules of the relevant share option scheme.
2.6 No Option shall be granted to an Eligible Employee within the period of
two years next preceding his sixty-fifth birthday, unless the Directors
shall in their absolute discretion on a case by case basis allow such a
grant to recognise an employee's valuable contribution to the Company.
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2.7 No payment shall be required for the grant of any Option. Each Option
shall be granted by means of a certificate executed as a deed by the
Company which shall be issued to the Option Holder as soon as
reasonably practicable following the Date of Grant of the related
Option and shall specify the number of Ordinary Shares subject to the
Option and the Option Price. The date upon which the Directors resolve
to grant an Option unconditionally shall constitute for all purposes
the Date of Grant of such Option and such date shall be specified in
the Option certificate if different from the date of execution of such
certificate.
2.8 An Option Holder may renounce their Option by giving notice in writing.
The notice must be received not later than 28 days after the Date of
Grant of that Option. If this is done, the Option shall be deemed never
to have been granted.
3 RIGHTS TO EXERCISE OPTIONS
3.1 Save as hereinafter provided, an Option may not be exercised in whole
or in part:
(a) before the expiration of a period of three years commencing on
its Date of Grant (unless the Directors at their discretion
determine in relation to a particular Option before it is
granted that it can be exercised earlier and so specify in the
Option certificate); and
(b) unless and until any applicable Relevant Conditions have been
satisfied.
Thereafter an Option may, subject as herein after provided, be
exercised in whole or in part at any time or times until the expiration
of the Option Period.
3.2 If an Option Holder dies whilst any Option remains available for future
exercise by him, such Option may be exercised at any time during the
period of 12 months from the date of his death or until sooner expiry
of the Option Period (provided that he was not at the date of death an
Excluded Person), notwithstanding that such exercise occurs before the
third anniversary of its Date of Grant but subject to satisfaction of
any applicable Relevant Conditions. To the extent that any Option so
exercisable is not exercised within such period of 12 months, it shall
forthwith lapse.
3.3 If an Option Holder ceases to be an Eligible Employee by reason of any
of the following circumstances, namely:
(a) retirement at or after his sixty-fifth birthday; or
(b) retirement with the consent of the Directors before his
sixty-fifth birthday; or
(c) injury or disability (evidenced to the satisfaction of the
Directors) or dismissal for redundancy (within the meaning of
the Employment Rights Act 1996); or
(d) the company by which he is employed (or of which he is a
Full-time director) leaving the Group; or
(e) the transfer or sale of the undertaking or part-undertaking,
in which the Option Holder is employed (or of which he is a
Full-time director), to a person other than a member of the
Group;
his Option shall subject to satisfaction of any applicable Relevant
Conditions become or remain exercisable by him for a period of six
months from the date on which he ceased to be such an employee,
notwithstanding that exercise occurs before the third anniversary of
the Date of Grant of such Option but provided that such exercise occurs
before the expiration of the Option Period. To the extent that any
Option so exercisable is not exercised within such period of six
months, it shall forthwith lapse.
3.4 Save as hereinbefore provided, if an Option Holder ceases to be an
employee or director of the Group any Options shall forthwith lapse
unless the Directors shall in their absolute discretion allow such
Option Holder to exercise his Options on a once and for all basis
during a period not exceeding twelve months as determined by the
Directors, and upon expiry of such period, such Options shall lapse.
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3.5 If in consequence of an offer made to the holders of the Equity Shares
(being an offer made in the first instance on a condition such that, if
it is satisfied, the offeror will have control of the Company) or
otherwise, any person or persons acting in concert shall have obtained
control of the Company, then the Directors shall as soon as practicable
thereafter notify every Option Holder accordingly and each Option
Holder shall be entitled at any time within the period of six months
after such control has been obtained, subject to the limitations
imposed by paragraphs 3.1(b), 3.2, 3.3 and 3.4, to exercise any Option
notwithstanding that such exercise occurs before the third anniversary
of its Date of Grant. To the extent that it has not been exercised, any
Option shall upon the expiration of such period lapse: provided that
if, during such period, any such person becomes entitled to exercise
rights of compulsory acquisition of Equity Shares pursuant to Part
XIIIA of the Companies Act 1985 and gives notice in writing to any
holders of Equity Shares that he intends to exercise such rights,
Options shall remain exercisable to the extent aforesaid until one
month from the date of such notice and to the extent that they have not
been exercised shall thereupon lapse.
3.6.1 If any company ("the Acquiring Company"):
(a) obtains control of the Company as a result of making a general
offer:
(i) to acquire the whole of the issued ordinary share
capital of the Company which is made on a condition
such that if it is satisfied the person making the
offer will have control of the Company; or
(ii) to acquire all the Ordinary Shares;
(b) obtains control of the Company in pursuance of a compromise or
arrangement sanctioned by the court under section 425 of the
Companies Act 1985 or Article 418 of the Companies (Northern
Ireland) Order 1986; or
(c) becomes bound or entitled to acquire shares in the Company
under sections 428 to 430 of that Act or Articles 421 to 423
of that Order,
any Option Holder may at any time within the Appropriate Period, by
agreement with the Acquiring Company, release his rights under this
Scheme (in this paragraph 3.6 referred to as "the Old Rights") in
consideration of the grant to him of rights (in this paragraph 3.6
referred to as "the New Rights") which are equivalent to the Old Rights
but relate to shares in a different company (whether the Acquiring
Company itself or a company which has control of the Acquiring Company
or a company which either is, or has control of a company which is a
member of a consortium owning either the Acquiring Company or a company
having control of the Acquiring Company).
3.6.2 In paragraph 3.6.1 above the "Appropriate Period" means:
(a) in a case falling within paragraph 3.6.1(a), the period of six
months beginning with the time when the person making the
offer has obtained control of the Company and any conditions
subject to which the offer is made is satisfied;
(b) in a case falling within paragraph 3.6.1(b), the period of six
months beginning with the time when the court sanctions the
compromise or arrangement; and
(c) in case falling within paragraph 3.6.1(c), the period during
which the Acquiring Company remains bound or entitled as
mentioned in that paragraph.
3.6.3 The New Rights shall not be regarded for the purposes of this paragraph
3.6 as equivalent to the Old Rights unless:
(a) the shares to which they relate satisfy the conditions
specified, in relation to scheme shares, in paragraphs 10 to
14 of Schedule 9 to the Taxes Act;
(b) the New Rights will be exercisable in the same manner as the
Old Rights and subject to the provisions of this Scheme as it
had effect immediately before the release of the Old Rights;
and
(c) the total market value, immediately before the release, of the
Ordinary Shares which were subject to the Option Holder's Old
Rights is equal to the total market value, immediately after
the grant, of the shares in respect of which the New Rights
are granted to the Option Holder; and
(d) the total amount payable by the Option Holder for the
acquisition of shares in pursuance of the New Rights is equal
to the total amount that would have been payable for the
acquisition of Ordinary Shares in pursuance of the Old Rights.
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3.7 If notice is duly given of a general meeting at which a resolution will
be proposed for the voluntary winding-up of the Company, every Option
shall be exercisable (but so that any exercise hereunder shall be
conditional upon such resolution being passed) at any time thereafter
until the resolution is duly passed or defeated or the general meeting
concluded or adjourned sine die, whichever shall first occur, subject
to the limitations imposed by paragraphs 3.1(b), 3.2, 3.3 and 3.4. If
such resolution is duly passed all Options shall to the extent that
they have not been exercised thereupon lapse.
3.8 If, pursuant to paragraph 3.6, an Option Holder releases his Option in
consideration of the grant to him of an equivalent option ("the New
Option") to acquire shares in the Acquiring Company or a company which
has control of the Acquiring Company, then in relation to the New
Option references to "the Company" shall be construed as references to
the company whose shares are the subject of the New Option in the
definitions of "Ordinary Shares" and "Relevant Event" and for the
purposes of this Scheme where the context so requires.
3.9 Notwithstanding any of the foregoing, no Option may in any event be
exercised by an Option Holder who is at the time of such exercise an
Excluded Person.
4 THE EXERCISE OF OPTIONS
4.1 To exercise an Option, an Option Holder must deliver to the Secretary
of the Company a notice in writing specifying the number of Ordinary
Shares in respect of which the Option is being exercised and
accompanied by payment in full of the aggregate Option Price; the date
of receipt of such notice by the Company shall constitute for all
purposes the date of exercise of such Option.
4.2 Unless prior to the exercise of an Option the Ordinary Shares acquired
upon such exercise are the subject of a registration statement filed
with the Securities and Exchange Commission pursuant to the Securities
Act of 1933 of the United States, as amended ("the Securities Act"),
and there is then in effect a prospectus filed as part of such
registration statement meeting the requirements of Section 10(a)(3) of
the Securities Act, the notice of exercise with respect to such Option
shall be accompanied by a representation by the Option Holder to the
Company that such shares are being acquired for investment only and not
with a view to the sale or distribution thereof except in compliance
with the Company's Charter and US and UK securities laws (unless, in
the opinion of the Company's legal advisers such representation is not
necessary to comply with the Securities Act), and the certificate
evidencing such Ordinary Shares shall bear such restrictive legend as
may be required by the Company or its Charter.
4.3 All issues or transfers of Ordinary Shares will be made within 30 days
of the date of exercise of the related Option, and will be subject to
such consents (if any) of HM Treasury or other authorities as may for
the time being be necessary and it shall be the responsibility of the
Option Holder:
(a) to comply with any requirements to be fulfilled in order to
obtain or obviate the necessity for any such consent; and
(b) in the case of a transfer of Ordinary Shares, to pay the
requisite stamp duty or stamp duty reserve tax.
4.4 If under the terms of a resolution passed or an announcement made by
the Company prior to the date of exercise of an Option, a dividend is
to be or is proposed to be paid to holders of Ordinary Shares on the
register on a date after such date of exercise, any Ordinary Shares to
be issued upon such exercise will not rank for such dividend. Subject
as aforesaid the Ordinary Shares so to be issued shall be identical and
rank pari passu in all respects with the fully paid Ordinary Shares
then in issue.
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4.5 No Option shall be capable of exercise in part (other than as to the
full extent then exercisable) as to less than 100 Ordinary Shares.
5 ADJUSTMENT OF OPTIONS
Upon the occurrence of any Relevant Event the number of Ordinary Shares
comprised in each Option and/or the Option Price thereunder may,
subject to the prior approval of the Inland Revenue, be adjusted in
such manner (not excluding retrospective adjustment where a Relevant
Event occurs after the date of exercise of an Option but the record
date relating to such Relevant Event precedes such date of exercise) as
the Directors (with the written concurrence of the Auditors that in
their opinion the adjustments proposed are fair and reasonable) may
deem appropriate in that such adjustment is necessary to take account
of any variation in the share capital of the Company; provided always
that:
(a) no adjustment shall be made so as to reduce the Option Price
per Ordinary Share to an amount less than the par value per
share; and
(b) subject to sub-clause (a) above, no increase shall be made in
the aggregate Option Price relating to any Option.
Notice of any such adjustments shall be given to Option Holders by the
Directors, who may call in Option certificates for endorsement or
replacement.
6 ADMINISTRATION
6.1 Any notice or other document which the Company is required or may
desire to give to any Option Holder pursuant to this Scheme shall be
sufficiently given if delivered to him (if he is still an Eligible
Employee) at his place of work or sent through the post in a pre-paid
cover addressed to the Option Holder at his address last known to the
Company and if so sent shall be deemed to have been duly given on the
date of posting. Any document so sent to an Option Holder shall be
deemed to have been duly delivered notwithstanding that he be then
deceased (and whether or not the Company has notice of his death)
except where his legal personal representatives have established their
title to the satisfaction of the Company and supplied to the Company an
address to which documents are to be sent.
6.2 Option Holders not otherwise entitled thereto shall be sent copies of
all notices and (so far as appropriate) other documents sent by the
Company to its Ordinary Shareholders generally.
6.3 The Directors shall have power from time to time to make or vary
regulations for the administration and operation of this Scheme
provided that such regulations are not inconsistent with the provisions
of this Scheme.
7 GENERAL
7.1 The Directors shall at all times keep available and reserved for issue
such authorised and unissued Ordinary Shares as may be required to meet
the subsisting rights of Option Holders.
7.2 The decision of the Directors in any dispute or question affecting any
Option Holder shall be final and conclusive subject to the concurrence
of the Auditors whenever required under the provisions of this Scheme.
7.3 The Company by the vote of the shareholders, or the Directors, may at
any time resolve to terminate this Scheme in which event no further
Options shall be granted but the provisions of this Scheme shall in
relation to Options then subsisting continue in full force and effect.
7.4 An Option or the benefit thereof shall not (except as may be required
by taxation law) form part of the emoluments of an Option Holder or
count as wages or remuneration and shall not be pensionable. In no
circumstances shall an Option Holder on ceasing to be an employee of
the Group for any reason be entitled to, or claim as against any member
or former member of the Group any compensation for or in respect of any
consequent diminution or extinction of his rights or benefits (actual
or prospective) under any Options then held by him or otherwise in
connection with this Scheme.
7.5 The rules of this Scheme shall be interpreted in accordance with
English law.
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8 ALTERATIONS
This Scheme may be altered by the Directors from time to time subject
to the following provisions:
(a) the provisions of this Scheme relating to:
(i) the persons to whom, or for whom, securities are
provided under this Scheme (the "participants");
(ii) limitations on the number or amount of the securities
subject to this Scheme;
(iii) the maximum entitlement for any one participant;
(iv) the basis for determining a participant's entitlement
to, and the terms of, securities to be provided and
for the adjustment thereof (if any) in the event of a
capitalisation issue, rights issue or open offer,
sub-division or consolidation of shares or reduction
of capital or any other variation of capital;
cannot be altered to the advantage of participants, without
the prior approval of the Company's shareholders (except for
minor amendments to benefit the administration of this Scheme,
to take account of a change in legislation or to obtain or
maintain favourable tax, exchange control or regulatory
treatment for participants in this Scheme or for the Company
or for members of the Group);
(b) no alteration to Part A of this Scheme shall become effective
until it has been approved by the Board of Inland Revenue;
(c) save in order to maintain the approval of Part A of this
Scheme by the Board of Inland Revenue, no alteration shall be
effective to abrogate or alter adversely any of the subsisting
rights of Option Holders except with such consent or sanction
on the part of the Option Holders as would be required under
the provisions of the Company's Certificate of Incorporation
if the Options constituted a single class of shares (or, where
the Directors deem it appropriate, two or more classes of
shares according to the periods, as determined by the
Directors, in which the Dates of Grant fall) and as if such
provisions applied mutatis mutandis thereto.
(d) the Directors may only make alterations to the Relevant
Conditions applying to an Option if an event or events happen
which mean that the original Relevant Conditions are no longer
achievable and they may only make such alterations:
(i) as the auditors for the time being of the Company
shall have confirmed in writing to be in their
opinion fair and reasonable and not more onerous than
before the alteration; and
(ii) to the extent that the Relevant Conditions following
such alteration are in their reasonable opinion and
taken as a whole no less onerous than the original
Relevant Conditions.
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PART B - UNAPPROVED OPTIONS
9 GRANT OF UNAPPROVED OPTIONS
The Directors may, notwithstanding any other provision of this Scheme,
grant Options which do not attract the tax reliefs available by virtue
of Section 185 of the Taxes Act. To every such Option (an "Unapproved
Option") Part A of this Scheme shall apply save only as modified by the
provisions of this Part B.
10 NO INLAND REVENUE APPROVAL
No Inland Revenue approval or consent shall be necessary, and
accordingly:
(a) the definition of "Option Price" and paragraphs 3 and 5 of
Part A shall, in their application to Unapproved Options, be
so read and construed;
(b) paragraph 8 (b) of Part A shall not apply; and
(c) paragraph 8 (c) of Part A shall, in its application to
Unapproved Options, be so read and construed.
11 OPTION PRICE
The definition of Option Price shall be amended, inserting the
following wording at the end of the definition: "plus an amount ("A")
equal to the amount of employer's national insurance contributions at
the rate prevailing at the date the gain arises in relation to the
Option, on the amount of gain per share which would arise if the
exercise price did not include A, provided that such price shall not be
less than the par value per Ordinary Share".
12 LIMIT OF FOUR TIMES RELEVANT REMUNERATION
No Option shall be granted to an Eligible Employee if, as a result, the
aggregate market value (as at the respective Dates of Grant) of Equity
Shares which might fall to be or have been acquired by him pursuant to
grants or awards made following the quotation of the Company's Ordinary
Shares on the Alternative Investment Market of the London Stock
Exchange under any employee share option scheme or other employee share
scheme adopted by the Company or any Subsidiary (other than any
savings-related share option scheme) and granted within the immediately
preceding ten years, would exceed four times his Relevant Remuneration.
The following definitions shall apply for the purposes of this
provision:
Relevant Remuneration the Remuneration of an Eligible Employee
from the Group for the current or
immediately preceding year of assessment
(whichever is the greater): provided that,
where there is no such Remuneration for the
preceding year of assessment, there shall be
substituted such Remuneration for the period
of 12 months beginning with the first day
during the year of assessment in respect of
which such Remuneration shall have been paid
Remuneration such emoluments of the office or employment
by virtue of which any employee is an
Eligible Employee as are liable to be paid
under deduction of United Kingdom income tax
pursuant to Section 203 of the Taxes Act (or
would be so liable if the employee and his
employing company were both resident in the
United Kingdom) after deducting therefrom
amounts included (or which would be so
included) by virtue of Chapter II of Part V
of the Taxes Act
For the purposes of this provision, the term "Option" includes any
Option which has been surrendered or which has otherwise lapsed.
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13 NO (POUND) 30,000 LIMIT
Paragraph 2.5 of Part A shall not apply.
14 ELIGIBILITY
14.1 The definition of "Eligible Employee" shall in its application to
Unapproved Options be extended to include any director or consultant
(not being an employee) of any member of the Group and all references
to "Full-time" in relation to any director shall, in relation to
Unapproved options, be deleted.
14.2 References in paragraphs 3.3 and 3.4 to an Option Holder ceasing to be
an Eligible Employee shall be read and construed as references to the
cessation of the directorship or consultancy of any Option Holder who
is not an employee.
14.3 In relation to an Option Holder who is neither an employee or a
director, paragraphs 11, 12 and 15 of this Scheme shall not apply.
15 PAYE
15.1 It shall be a term of all Options granted under this Part B of this
Scheme, and a condition of the right to exercise, or release for
consideration, all such Options that, if the exercise or release of an
Option gives rise to a liability of any member of the Group under
Section 203FB of the Taxes Act or otherwise pursuant to the United
Kingdom's Pay-as-you-Earn ("PAYE") system (or any other equivalent
withholding tax system in any other applicable jurisdiction), such
member of the Group shall (to the extent permitted by law) be entitled
to withhold from such Option Holder's salary or other payments due to
him, and/or the Option Holder shall be required to pay to such member
of the Group, as a condition of such exercise or release, the material
amount. For this purpose, the "material amount" is the amount which
such member of the Group is required to pay to the Inland Revenue (or
other relevant taxing authority) or, at the discretion of the
Directors, an amount equal to a specific percentage of such gain (not
being greater than the highest marginal rate of income tax at the
material time).
15.2 Any such payment by an Option Holder shall be made within such period
as the relevant member of the Group shall notify to him in writing,
provided that not less than one month's notice shall be given. The
Company may refuse to permit (a) the exercise of any Option or (b) the
release of any Option for consideration if any such payment is not
satisfied by the Option Holder within such period as shall have been
notified in writing to him.
15.3 Alternatively, if the Directors so decide in their absolute discretion,
the PAYE or other taxation liability falling upon any member of the
Group may be satisfied by (a) the Company not releasing to the Option
Holder concerned such number of Ordinary Shares (which expression shall
for this purpose include other shares or securities to be issued upon
such exercise) or (b) deducting from any consideration for the release
of an Option granted under this Part B of this Scheme such monetary
amount as shall in either case equal in value the material amount,
together (where relevant) with any commission or similar reasonable
costs to be reasonably and properly incurred by the Company upon the
disposal of any such Ordinary Shares to fund such tax liability.
15.4 If the material amount in respect of any Option Holder shall exceed the
amount payable by or in respect of that Option Holder, the relevant
member of the Group shall account to such Option Holder for such
excess.
15.5 Upon the exercise of an Option, each Option Holder shall appoint
(irrevocably and by way of security for the performance of his or her
obligations under paragraphs 15.1 to 15.4) the Company (with full power
of substitution) as his attorney for the purpose of signing, in the
name and on behalf of such holder, any documents required to implement
the foregoing or doing any act or thing (including, without prejudice
to the generality of the foregoing, the right to sell Ordinary Shares
not so released as aforesaid).
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