Income Tax (Earnings and Pensions) Act 2003 Schedule 4 paragraph 21

Requirements etc. relating to share options: introduction

Paragraph 21 introduces the mandatory requirements and optional provisions that a Company Share Option Plan (CSOP) scheme must or may include in relation to share options.

• A CSOP scheme must meet mandatory requirements covering general option terms, the price for acquiring shares, and the non-transferability of share options.
• The scheme may also include optional provisions dealing with the exercise of options when an individual ceases to be a director or employee.
• Further optional provisions may address the exercise of options on the death of the option holder.
• The scheme may also include provisions governing the exercise of options when specific company events occur, such as takeovers or reorganisations.