ICICI Bank Limited
Employees Stock Option Scheme - 2000
Section I: Objectives
The objectives of the Scheme are:
a) to enhance employee motivation;
b) to enable employees to participate whether directly or indirectly in the
long term growth and financial success of the Bank; and
c) to act as a retention mechanism by enabling employee participation in the
business as an active stakeholder to usher in an 'owner-manager' culture.
Section II: Definitions
The following terms shall have the meanings set forth below:
"Award Confirmation" means any written communication by the Bank to a
Participant, evidencing grant of Option.
"Bank" means ICICI Bank Limited and unless repugnant to or inconsistent with the
context, means and includes its Subsidiary(ies).
"Cause" means (i) engaging in willful or gross misconduct or neglect (ii) the
commission of a crime of moral turpitude, felony, fraud, misappropriation,
embezzlement or breach of trust (iii) gross or willful insubordination or (iv)
any other act detrimental to the Bank.
"Committee" means a committee of the Board of Directors of the Bank consisting
of a majority of Independent Directors as the Board of Directors of the Bank may
designate from time to time.
"Eligible Employee" means any permanent employee of the Bank in the grade of
Assistant Manager (or equivalent grade) and in higher grades and the directors
(including whole time directors) of the Bank, its subsidiaries and holding
company.
"Exercise Period" means the period after vesting within which the Participant
should exercise his right to apply for Shares against the Option vested in him.
"Exercise Price" means the price payable by the Participant for exercising the
Option granted to him.
"Holding Company" means for the purpose of this Scheme, ICICI Ltd.
"Independent Director" means a director of the Bank, not being a whole time
director of the Bank.
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"Option" means a right but not an obligation granted to a Participant to apply
for specified number of Shares at a pre-determined price, during the term fixed
by the Committee, and subject to such other limitations and restrictions in this
Scheme.
"Participant" means any Eligible Employee as the committee shall select from
time to time, to whom an Option is granted, or the successors of the
Participant, as the context so requires.
"Scheme" means this Scheme.
"Shares" means the equity shares of the Bank, having a par value Rs.10 per share
for the time being, or such other nominal value, as may be decided by the Board
of Directors from time to time.
"Subsidiary" means any company of which more than 50% of the nominal value of
its equity share capital is directly or indirectly owned by the Bank or any
company whose composition of Board of Directors is controlled by the Bank and
shall include a subsidiary of the Subsidiary.
"Successors" of a Participant means the legal representative(s) of a deceased
Participant.
"Vesting Confirmation" means any written communication by the Bank to a
Participant, evidencing vesting of Option.
"Vesting Criteria" means such criteria as may be stipulated by the committee as
conditions precedent to vesting of Options.
"Vesting Period" means the period during which the vesting of the Option granted
to the Participant takes place.
Section III: Administration of the Scheme
1. The Scheme shall be administered by the Committee. A member of the
committee to whom the matter under the Scheme specifically relates shall
not vote on such matter.
2. Unless otherwise expressly provided in the Scheme or applicable law, all
decisions, determinations and interpretations with respect to the Scheme or
Award Confirmation shall be within the sole discretion of the Committee,
may be made at any time and shall be final, conclusive and binding upon all
persons including the Bank, any Participant, any shareholder and any
employee.
3. Unless otherwise expressly provided in the Scheme or applicable law, the
Scheme shall also be applicable to employees (including Directors) of the
holding company and all the Subsidiaries of the Bank.
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Section IV: Committee Authority
1. Subject to the provisions of the Scheme and applicable law and in addition
to the other express powers and authorizations conferred by the Scheme, the
Committee shall have full power and authority to:
i. Determine eligibility of employees to participate in the Scheme from
time to time;
ii. Determine and designate Participants and the number of Options to be
granted to each Participant;
iii. Determine the number of Shares subject to each Option;
iv. Determine the number of Options to be covered under the Scheme from
time to time;
v. Determine the quantum of Option to be granted under the Scheme per
Participant and in aggregate;
vi. Prescribe the Vesting Period and Vesting Criteria subject to which the
Options granted would vest;
vii. Prescribe the conditions under which the Option vested in the
Participant may lapse (including in case of termination);
viii.Prescribe the Exercise Period within which the Participant should
exercise the vested Option (including in the event of termination or
resignation of the Participant);
ix. Prescribe whether the Options vested in a Participant are exercisable
at one time or at various points of time within the Exercise Period;
x. Formulate and prescribe the procedure for making a fair and reasonable
adjustments to the number of Options or to the Exercise Price or both
in case of rights issues, bonus issues and other corporate actions;
xi. Prescribe the conditions and procedure for the grant, vest and
exercise of Options by Participants who are on long leave, training or
otherwise indisposed;
xii. Formulate and prescribe if deemed appropriate and necessary, the
procedure for cashless exercise of Options;
xiii.Establish, amend, suspend or waive such rules and regulations as it
shall deem appropriate for the proper administration of the Scheme;
xiv. Interpret the Scheme and the Award Confirmation;
xv. Appoint such agents as it shall deem necessary for the proper
administration of the Scheme;
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xvi. Determine or impose other conditions to the grant or exercise of
Options under the Scheme as it may deem appropriate;
xvii. Make any other determination and take any other action that the
Committee deems necessary or desirable for the administration of the
Scheme;
xviii. Frame suitable policies and systems to ensure that there is no
violation of:
a) Securities and Exchange Board of India (Insider Trading)
Regulations, 1992; and
b) Securities and Exchange Board of India (Prohibition of Fraudulent
and Unfair Trade Practices relating to the Securities Market)
Regulations, 1995;
by any employee.
Section V: Eligibility
1. The Committee shall have the sole authority to designate any Eligible
Employee as Participant.
2. In determining the Eligible Employee to receive an Option as well as in
determining the number of Options to be granted to a Participant, the
Committee may consider the position and responsibilities of the Eligible
Employees the nature and value to the Bank of his services and
accomplishments whether directly or indirectly, length of service, grade,
performance, merit, present and potential contribution and conduct of the
Eligible Employee and such other factors as the Committee may deem
relevant.
Section VI: Vesting of Option
1. The Options granted to the Participant may vest at one time or at various
points of time as provided in the Award Confirmation. Provided however
there shall be a minimum period of one year between the grant of Options
and vesting of Options. Unless earlier expired, forfeited or otherwise
terminated, each Option shall expire in its entirety upon the third
anniversary of the date of grant of Option.
2. No portion of the Option shall vest -
a) If the Participant does not fulfill Vesting Criteria as stipulated in
the Award Confirmation; or
b) If the Participant's employment is terminated by the Bank for Cause
or
c) if the Participant voluntarily terminates employment with the Bank
(other than on account of death, retirement, including pursuant to
any voluntary retirement scheme or permanent disability);
and the Options to the extent not vested shall lapse/expire/be forfeited
forthwith.
3. If the Participant's employment terminates due to death, retirement
(including pursuant to any voluntary retirement scheme) or permanent
disability, whole of the Options shall vest in the Participant's
Successors, or the Participant, as the case maybe.
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Section VII: Exercise of Options
1. Subject to vesting and other restrictions provided for hereunder or
otherwise imposed in accordance herewith, the Participant may exercise an
Option at such time during the Exercise Period as may be stipulated in the
Vesting Confirmation, provided that the Exercise Period shall not exceed
the tenth anniversary from the date of grant of Option or fifth anniversary
from the date of vesting of Option, whichever is later.
2. Upon receipt of the notice for exercise of the Option (in the form
prescribed by the Committee) and the payment of Exercise Price in a form
and manner as may be stipulated by the Committee, the Bank shall issue and
allot Shares to the Participant.
3. The Bank may, in its sole discretion grant and/or arrange loans to the
Participant for enabling the Participant to pay the Exercise Price on such
terms and conditions as it deems necessary.
4. If the participant's employment is terminated by the Bank for the Cause the
Participant's vested Options, to the extent then unexercised, shall
thereupon cease to be exercisable and shall be forfeited forthwith.
5. If the participant's employment is terminated due to death, retirement
(including pursuant to any voluntary retirement scheme) or permanent
disability, the Option, if such Option is vested, shall be exercised by the
payment of Exercise Price in full within a period of three months from the
date of death, retirement or severance or termination, which period shall
be deemed to be the Exercise Period.
Section VIII: General Terms And Conditions
1. The Bank may with the approval of the Board of Directors of the Bank and
such other approvals as may be required amend, discontinue or terminate the
Scheme or any portion thereof at any time. Provided that any such
amendment, discontinuation or termination that would impair the rights of
any Participant or which is detrimental to the interest of the
Participants, shall not to that extent be effective without the consent of
the affected Participant.
2. Participation in the Scheme shall not constitute or be construed as a
guarantee of return on the Shares of the Bank by the Bank. Any
loss/potential loss due to fluctuations in the market price of the Shares,
and the risks associated with such investment are that of the Participant
alone and not of the Bank.
3. This Scheme shall be subject to all applicable laws, rules and regulations
made by the appropriate governmental and regulatory authorities and such
other terms and conditions, as may be imposed by the Committee in its
absolute discretion.
4. In the event of issuance of bonus/rights shares, or recapitalisation, stock
split, reorganisation, merger, consolidation of the Bank or other similar
events the Committee is authorised to make such adjustment in the Exercise
Price or the Options granted/awarded, as it may deem equitable and
appropriate in order to prevent dilution or enlargement of the benefits
available under the Scheme.
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5. The Committee may at any time waive any conditions or rights under, amend
any terms of, or alter, suspend, discontinue, cancel or terminate, any
Option theretofore granted, prospectively or retrospectively; provided that
any such waiver, amendment, alteration, suspension, discontinuation,
cancellation or termination in any manner which may be detrimental to the
interests of the Participant shall not to that extent be effective without
the consent of the affected Participant.
6. The employees shall maintain the utmost confidentiality regarding the
contents of the Scheme at all times and shall not make any announcement to
the public or to any third Person regarding the arrangement contemplated by
the Scheme except to the extent as may be required by law.
7. The Bank is entitled to and may, anytime at its discretion, finance the
Participant in any manner to the extent permitted by law for the purpose of
purchase of Shares or payment of any amount under the Scheme.
8. The grant of an Option shall not be construed as giving a Participant the
right to be retained in the employment of the Bank. Neither the Scheme nor
Award Confirmation shall form part of any contract of employment between
the Bank and the Participant. The rights and obligations of the Participant
under the terms of his office or employment with the Bank shall not be
affected by his participation in the Scheme. Nothing in the Scheme or any
Award Confirmation shall confer or be construed as affording any
Participant any additional rights as to compensation or damages in
consequences of the termination of such office or employment for any
reason.
9. Subject to the provisions of the Scheme, no Participant or holder or
beneficiary of any Option shall have any rights as a shareholder with
respect to any Shares to be issued pursuant to the Scheme until he has
become the holder of such Shares.
10. The shares issued pursuant to any Option shall rank pari passu with all the
other equity shares of the Bank for the time being issued.
11. Neither the Scheme nor the Option shall create or be construed to create a
trust or a separate fund of any kind or a fiduciary relationship between
the Bank and a Participant. To the extent that any Person acquires a right
to receive payment from the Bank pursuant to any Option, such right shall
be no greater than the right of any unsecured general creditor of the Bank.
12. No fractional shares shall be issued or delivered pursuant to the Option,
and the Committee shall determine whether cash, other securities or other
property shall be paid or transferred in lieu of any fractional shares or
whether such fractional shares or any rights thereto shall be cancelled,
terminated, or otherwise eliminated.
13. No employee shall have any claim to be granted any Option, and there is no
obligation for uniformity of treatment of employees or holders or
beneficiaries of Option. The terms and conditions of Options need not be
the same with respect to each Participant.
14. No option shall be assigned, alienated, pledged, attached, sold or
otherwise transferred or encumbered by the Participant, except to the
extent provided under the Scheme or by will or the laws of inheritance.
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15. Nothing contained in the Scheme shall prevent the Bank from adopting or
continuing compensation arrangements and such arrangements may be either
generally applicable or applicable only in specific cases.
16. In the event of any tax liability arising on account of granting of the
Option to the Participant, the liability shall be that of the Participant
alone and the Bank shall have the right to cause the Shares held by the
Participant sold or otherwise alienated to meet the liability on behalf of
the Participant.
17. The Participant shall do all acts necessary and execute all such deeds and
documents as may be deemed necessary by the Committee to give effect to
the terms of the Scheme.
18. For whatsoever reason the vested options remaining unexercised, or
forfeited or lapsed, it shall be open for the Committee to reuse these
Options to be granted to the other eligible employees at its sole
discretion.
Section IX: Award Confirmation
The grant of Options hereunder shall be evidenced by an Award Confirmation which
shall be delivered to the Participant and shall specify the terms and conditions
of the grant of Options and rules applicable thereto.
Section X: Vesting Confirmation
The vesting of Options hereunder, shall be evidenced by a Vesting Confirmation
which shall be delivered to the Participant and shall specify the terms and
conditions of the vesting of Options and rules applicable thereto.
Section XI: Effective and Expiry Dates
This Scheme shall be effective as of the date of its approval by the
shareholders of the Bank and expire on such date as may be notified by the Board
of Directors of the Bank.
Section XII: Headings
Headings are given to the Sections of the Scheme solely as a convenience to
facilitate reference. Such headings shall not be deemed in any way material or
relevant to the construction or interpretation of the Scheme or any provision
thereof.
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