Clause 10

by inserting, immediately after the words “equal to” in the 3rd line of subsection (2)(a), the words “or exceeds”;

by deleting the word “or” at the end of subsection (3)(a);

by deleting the full-stop at the end of paragraph (b) of subsection (3) and substituting the word “; or”, and by inserting immediately thereafter the following paragraph:“(c)which is derived by him for the release of his right or benefit to acquire shares in any qualifying company or in its holding company by reason of his resignation or termination of his employment with the qualifying company due to misconduct.”; and

by inserting, immediately after subsection (6), the following subsections:“(7) For the purposes of this section and section 13L, where a company grants on or after 1st April 2001 any right or benefit to acquire shares under a tranche of a stock option scheme and any gains or profits derived by a qualifying employee from the exercise, assignment or release of the right or benefit granted under that tranche qualifies for tax exemption under this section as well as section 13L, the company shall opt for the tax exemption under this section or section 13L to apply in respect of the gains or profits relating to that tranche but not under both sections.(8) Where a company has opted under subsection (7) for tax exemption under this section to apply to the gains or profits in respect of a tranche of a stock option scheme, tax exemption under section 13L —

shall, subject to paragraph (b), not be available in respect of any right or benefit to acquire shares granted by the company under any tranche subsequent to that tranche under the stock option scheme; and

shall be available in respect of any right or benefit to acquire shares granted subsequent to the option by the company under any tranche under the stock option scheme only where the conditions for tax exemption under this section are not satisfied in respect of any such subsequent tranche granted.(9) Where a company has opted under subsection (7) for tax exemption under section 13L to apply to the gains or profits in respect of a tranche of a stock option scheme, tax exemption under this section shall not be available in respect of any right or benefit to acquire shares granted by the company under any tranche subsequent to that tranche under the stock option scheme.(10) Any option by a company under subsection (7) shall be irrevocable.”.