As regards taxation, employee options are ranked on a par with salary. This means that the individuals concerned will be taxed in the same way as for income tax when the options are utilised and social costs for SEB will be payable at that juncture. Allocation of employee options has been implemented to replace the value of former corresponding bonus systems and similar forms of remuneration.
More information on the staff option programme:
Each employee option entitles the holder to acquire one SEB series-A share at a price of SEK 91.50. The price of acquisition of the SEB share is calculated at 110 per cent of the average stock market price during the fortnight following presentation of the annual report of SEB on 15 February. Utilisation of employee options may only take place between the years 2003 - 2007; i.e. utilisation of the options is frozen for the three years immediately following the options having been issued.
In order to secure SEB against the effect that share-price increases might have upon employee options, the options, including social costs, have been hedged by means of a third-party derivative-contract. By means of this the costs for SEB are limited as regards share-price increases as opposed to the difference between interest costs and dividends for those underlying shares in the derivative-contract at the same time as there is a certain exposure against an eventual drop in share prices. Distribution of the options will be taken up in the annual report.