59
VTech Holdings Limited
Annual Report 2014
16 Share Capital, Share Options and Share
Purchase Scheme
(Continued)
(b) Share Options
(Continued)
Pursuant to 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 2011 scheme and any
other schemes does not in aggregate exceed 10% of the relevant
class of shares in issue as at the date of adoption of the 2011
Scheme. 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.
Subject to the further restrictions in the Listing Rules concerning
grant of options to substantial shareholders, the total number of
shares issued and to be issued upon exercise of options granted
and to be granted to any one eligible employee in any 12-month
period must 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 by the grantee. The period within which the options must be
exercised will be specified by the Company at the time of grant,
and must expire no later than 10 years from the date of grant. The
Company may specify any minimum period(s) for which an option
must be held before it can be exercised. The 2011 Scheme does
not contain any such minimum period. The 2011 Scheme has a life
of 10 years and will expire on 21 July 2021. As at the date of this
Annual Report, the number of shares which may be issued upon
exercise of options to be granted under the 2011 Scheme was
23,095,913 shares, which represented approximately 9.19% of the
issued share capital of the Company. During the financial year and
since the adoption of the 2011 Scheme, no options were granted,
exercised, lapsed or cancelled under the 2011 Scheme.
As at the date of this Annual Report, there was no share available for issue under the 2001 Scheme. The movements in the number of
share options under the 2001 Scheme during the financial year were as follows:
Number of share options
Balance in issue at
Exercised Balance in issue at
Date of grant
Exercise price Exercisable period
(Note 1)
1 April 2013 during the year
31 March 2014
Directors
17 April 2008
HK$41.07
23 April 2011 to 22 April 2013
128,000
(128,000)
–
(Note 2)
9 April 2010
HK$85.35
13 April 2012 to 12 April 2014
384,000
(174,000)
210,000
(Note 3)
Employees
9 April 2010
HK$85.35
12 April 2012 to 18 April 2014
342,000
(192,000)
150,000
(Note 4)
854,000
(494,000)
360,000
Notes:
(1)
The 2001 Scheme does not specify any minimum holding period before the option can be exercised but the Board has the authority to determine the minimum
holding period at the time of grant of any particular option.
(2)
An aggregate of 128,000 share options were exercised at the exercise price of HK$41.07 per share during the financial year. The weighted average closing prices of
the shares of the Company immediately before the date on which the options were exercised and at the date of exercise were HK$106.50 per share and HK$102.40
per share respectively.
(3)
An aggregate of 174,000 share options were exercised at the exercise price of HK$85.35 per share during the financial year. The weighted average closing prices of
the shares of the Company immediately before the date on which the options were exercised and at the date of exercise were HK$116.90 per share and HK$113.10
per share respectively.
(4)
An aggregate of 192,000 share options were exercised at the exercise price of HK$85.35 per share during the financial year. The weighted average closing prices of
the shares of the Company immediately before the date on which the options were exercised and at the date of exercise were HK$114.10 per share and HK$115.54
per share respectively.
(5)
No options were granted, lapsed or cancelled during the financial year.
(6)
Subsequent to the financial year and up to the date of this Annual Report, an aggregate of 310,000 share options were exercised at the exercise price of HK$85.35
per share.
Share option expenses charged to the consolidated income statement are determined using the Black-Scholes option pricing model
based on the following assumptions:
Date of grant
17 April 2008 9 April 2010
(Note 1)
(Note 2)
Fair value of each share option
as of the date of grant
HK$5.95
HK$22.12
Closing price at the date of grant
HK$40.1
HK$85.1
Exercise price
HK$41.07
HK$85.35
Expected volatility
43.33%
54.24%
Annual risk-free interest rate
1.88%
0.99%
Expected average life of options
3.5 years
2.5 years
Expected dividend yield
(Note 3)
10.3%
5.22%
Exercisable period
23 April 2011 to
22 April 2013
12 April 2012 to
18 April 2014
Notes:
(1)
The volatility measured at the standard deviation of expected share price
returns is based on statistical analysis of daily share prices over the two
years immediately preceding the grant date.
(2)
The volatility measured at the standard deviation of expected share price
returns is based on statistical analysis of daily share prices over the three
years immediately preceding the grant date.
(3)
Expected dividend yield is based on historical dividends over one year prior
to the grant date.
(4)
Changes in the subjective input assumptions could significantly affect the
fair value estimate.
