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Chennai , Aug 22

A TOTAL of 234,985 options - from the Associate Stock Options Plan (ASOP) of 2001 - were forfeited or surrendered in the year ended March 2003, according to the annual report for Polaris Software Labs for the year 2002-03.

This compares with a figure of 13,850 options - from the same plan - that were surrendered or forfeited in the year ended March 2002.

No options were cancelled in both years. The ASOP 2001 had an opening balance of 1,709,175 carried over from the previous year. Some 211,500 options were granted in the year ended March 2003 while 247,250 options were exercised.

The report said: "The 2001 plan provides for issuance of 1,194,000 equity shares of Rs 5 each to employees including directors, at the closing market price of shares on the date of the grant. The option vests over a period of five years from the date of the grant."

Meanwhile, the ASOP 2000 plan saw 153,200 options being surrendered or forfeited for the year ended March 2003.

This compares with a figure of 134,450 options for the previous year.

No options were cancelled last year while 663,100 cancellations took place in the year ended March 2002. In the last year, 877,950 options were issued compared to 468,850 options the previous year. Some 59,765 options were exercised.

In March 2002, shareholders had approved a proposal to modify the ASOP 2000 Plan so that the exercise price of the shares would be the closing market price of shares on the date of the grant.

The company's previous year's annual report had clarified that "659 employees surrendered 663,100 options as they found it no longer attractive to exercise these options for the prices at which they had been issued.''

During the year, the company allotted 307, 015 equity shares of Rs 5 each, pursuant to conversion of employee stock options.

The closing market price of the Polaris scrip was Rs 459.35 on January 5, 2001, Rs 188.95 on the first day of calendar 2002 and Rs 145.30 on March 3, 2003. It closed at Rs 116.75 on August 21.

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