Unexercised share options and share capital

Unexercised share options and share capital

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Hi, 

In 2015, we issued some share options under the EMI share option scheme.    At that time we made a pool of 428 options available for allocation and the price per share was calculated as company value/ (existing share capital + 428 options) 

The number of options made available (428) was greater than the number of options accepted (378).  These options are all as yet unexercised.  We are now wanting to issue a second round of options and I am preparing a valuation for HMRC.    The company has decided to make a pool of 5% of existing share capital available for the next round of options.   

I have some questions around this:

1.  For the purposes of a new share valuation, I have been advised by HMRC that I need to consider the unexercised options (378) when calculating the share capital on which to base the enlarged 5% pool.     Do the 50 unallocated options from the first option allocation also need to be considered as share capital?   The number of share options included as share capital will also of course also affect the price per share.  

2.  This is related to question 1, but what has happened to the 50 unallocated options?    Can they be added to the new 5% pool to effectively make more options available?   I guess they still exist, because the value of the first round of options was based upon their being 428 options available....

I would ask HMRC but from experience I suspect I may get a quicker and equally accurate response from this forum!

Thanks in advance, 

 

 

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