ESOS
How
share
options
financing
works
When
employees choose to initiate an “immediate
sell with best effort”
option
and at the same time exercise their share options, they are
not required to put in any collateral or cash.
Example
1:
Full Financing and Immediate Sell with Best Effort
An
Employee exercised 10,000
shares options at an exercise price of $1.50
per share and sold them on the same day at a market price of $2.50
per share.
|
Description
|
100%
Financing with "Immediate Sell"
|
|
Exercise cost (incl. CDP fee on exercise)
|
$ 15,010.70
|
|
ESOS processing fee
|
$
20.00
|
|
Total ESOS Loan
|
$ 15,030.70
|
|
ESOS financing interest (7% p.a.)**
|
$
57.65
|
|
Sub-to-sub transfer charges
|
$ 107.00
|
|
Total ESOS exercise costs
|
$ 15,195.35
|
|
|
|
|
Gross Sales proceeds
|
$
25,000
|
|
Less Sales costs:
|
|
|
(1) Brokerage rate (min S$40 or 0.5%)
|
$
125.00
|
|
(2) Clearing fee
|
$
10.00
|
|
(3) SGX access fee
|
$
1.88
|
|
GST on (1)+(2)+(3)
|
$
9.58
|
|
(4) SBL borrowing fee (10% p.a.)**
|
$ 136.99
|
|
(5) SBL admin fee
|
$
20.00
|
|
(6) SBL contract settlement fee
|
$
0.50
|
|
GST on (4)+(5)+(6)
|
$
11.02
|
|
|
$ 24,685.03
|
|
|
|
|
Estimated net profit due to client
|
$
9,489.68
|
Employees
can also opt for immediate sell, while self-financing the option
exercise.
Example 2:
Self-finance and Immediate Sell with Best Effort.
An
Employee exercised 10,000
shares options at an exercise price of $1.50
per share and sold them on the same day at a market price of $2.50
per share.
|
Description
|
Self-financing
with “Immediate Sell”
|
|
Exercise cost (incl. CDP fee on exercise)
|
$
15,010.70
|
|
ESOS processing fee
|
$
10.00
|
|
Sub-to-sub transfer charges
|
$
107.00
|
|
Total ESOS exercise costs payable
|
$
15,127.70
|
|
|
|
|
Gross Sales proceeds
|
$
25,000.00
|
|
Less Sales costs:
|
|
|
(1) Brokerage rate (min S$40 or 0.5%)
|
$
125.00
|
|
(2) Clearing fee
|
$
10.00
|
|
(3) SGX access fee
|
$
1.88
|
|
GST on (1)+(2)+(3)
|
$
9.58
|
|
(4) SBL borrowing fee (10% p.a.)**
|
$
136.99
|
|
(5) SBL admin fee
|
$
20.00
|
|
(6) SBL contract settlement fee
|
$
0.50
|
|
GST on (4)+(5)+(6)
|
$ 11.02
|
|
|
$
24,685.03
|
|
|
|
|
Estimated net profit due to client
|
$
9,557.33
|
**ESOS financing and SBL borrowing for 20 days. Actual duration
depends on processing time taken.
|
