Taxes Consolidation Act 1997 Schedule 12A paragraph 22

Optional early exercise

Paragraph 22 sets out the optional early exercise provisions that a savings-related share option scheme may include, allowing rights to be exercised ahead of the normal bonus date where specified corporate events occur or where an option-holder's employment situation changes.

• A scheme may permit early exercise on a takeover, court-sanctioned reconstruction, compulsory acquisition of dissenters, or voluntary winding up of the company whose shares are scheme shares.
• Exercise windows are generally six months from the triggering event, except for compulsory acquisition under section 457 of the Companies Act 2014, where rights may be exercised for as long as the acquirer remains bound or entitled.
• A scheme may permit early exercise where an option-holder loses eligibility because their employing company leaves the grantor's group or their role is transferred outside the group.
• A scheme may permit exercise within six months of the bonus date where the holder works for a non-participating company that is associated with, or controlled by, the grantor.