SCHEDULE 2... share incentive plans
Part 8Cash dividends and dividend shares
Reinvestment of cash dividends
62
(1)
A SIP may provide that, where the company so directs, the trustees must apply F1some or all of the cash dividends in respect of plan shares held on behalf of—
(a)
all participants, or
(b)
all participants who elect to reinvest their dividends,
in acquiring further shares on their behalf.
F2(1A)
The company's direction must set out—
(a)
the amount of the cash dividends to be applied as mentioned in sub-paragraph (1), or
(b)
how that amount is to be determined.
(2)
Sub-paragraph (1) is subject to paragraph 63 (requirements to be met as regards cash dividends).
(3)
In the SIP code—
(a)
the application of cash dividends as mentioned in sub-paragraph (1) is referred to as “reinvestment”; and
(b)
the further plan shares acquired are referred to as “”.
(4)
The company may F3modify or revoke a direction requiring the reinvestment of cash dividends.
(5)
References in the SIP code to the trustees acquiring dividend shares on behalf of a participant include their appropriating to a participant shares already held by them.