<< < > >>
Search:
| Full PDF report | Print this page |
Annual Report & Accounts 2015 - NOTES
slide
<< < > >>
20. share option schemes continued note c: these options were granted to certain directors and employees. the awards will vest in full (and become exercisable) on the share price being equal to or exceeding £6.00 per share for a continuous period of 90 calendar days at any time from the date of grant. if there is a change of control, the awards will vest in full immediately unless the share price is less than £5.00 per share, in which case the awards will lapse in full. the awards have been treated as vesting over a 3 year period. the directors' options under this scheme were cash cancelled after the year end on completion of the acquisition of bwin.party, and the aftertax proceeds re-invested in new GVC shares at 422p per share, the placing price. note d: these awards were issued on the same basis as the awards in Note c but were awarded as cash settled rather than equity settled options. the director's options under this scheme were cash cancelled after the year end on completion of the acquisition of bwin.party, and the after-tax proceeds re-invested in new GVC shares at 422p per share, the placing price. the charge to the consolidated income statement in respect of these options in 2015 was €449,000 (2014: €736,000). of the 2015 charge, €509,000 related to equity settled options and a net credit of €60,000 to cash settled options. the deduction from equity in respect of the cash payments to be made for the surrender of the vested equity instruments was €12,183,000. 20.1 Weighted average exercise price of options the number and weighted average exercise prices of share options is as follows: Weighted Weighted average average exercise number of exercise number of price options price options 2015 2015 2014 2014 outstanding at the beginning of the year 94p 6,806,947 191p 3,801,667 Granted during the year - - 1p 3,450,000 exercised during the year - - 184p (369,720) surrendered/bought out in the year 184p (3,200,000) 213p (75,000) Forfeited in the year 1p (125,000) - - outstanding at the end of the year 11p 3,481,947 94p 6,806,947 exercisable at the end of the year 156,947 3,356,947 the options outstanding at 31 december 2015 have a weighted average contractual life of 8.4 years (2014: 5.9 years). 20.2 Valuation of options the fair value of services received in return for share options granted were measured by reference to the fair value of share options granted. With the exception of the options granted in 2014 the estimate of the fair value of the services received is measured on a Binomial valuation model. the contractual life of the option (10 years) is used as an input into this model. expectations of early exercise are incorporated into the Binomial model. the option exercise price for all individuals was the average market price on grant date, with the exception of the options granted to third parties as part of the sportingbet acquisition. these were priced at the amount the Group offered as consideration for the purchase. the 2014 options were valued using a monte Carlo model due to the performance conditions associated with the options. the 2014 cash-settled options have been revalued using a monte Carlo model at 31 december 2015. Fair value of share options and assumptions: share price at exercise expected Fair value at date of grant* price expected exercise dividend Risk free measurement date of grant (in £) (in £) volatility multiple yield rate** date (in £) 21 may 10 1.85 2.13 60% 2 17% 2.75% 0.39 21 may 10 1.85 0.01 60% 2 17% 2.75% 0.05 21 may 10 1.85 1.50 60% 2 17% 2.75% 0.59 28 Jan 12 1.67 1.5479 58% 2 20% 2.19% 0.33 28 Feb 13 2.375 2.335 60% 2 12.15% 0.572% 0.61 02 Jun 14 - equity settled 4.49 0.01 24% n/a 10.00% 1.425% 0.41 02 Jun 14 - cash settled 4.49 0.01 21% n/a 9.40% 0.52% 0.28 * This is the bid price, not the mid-market price, at market close, as sourced from Bloomberg. ** The measurement of the risk-free rate was based on rate of UK sovereign debt prevalent at each grant date over the expected term of the option. 78 GVC HOLDINGS PLC ANNUAL REPORT 2015 notes to the consolidated financial statements continued for the year ended 31 december 2015