EasyJet 2009 Annual Report Download - page 79

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77 easyJet plc Annual report and accounts 2009
Pre-flotation scheme
Options vested in tranches of 25% ending on the third anniversary of easyJet’s admission to the Official List on 22 November 2000, and expire ten years
after grant.
Discretionary schemes
Options awarded in 2001 in connection with easyJet’s admission to the Official List had a three-year vesting period and no performance conditions.
All other awards have a three-year vesting period and performance conditions based on growth in earnings per share. During the year 54% of the options
granted in December 2005 vested.
Sharesave
Sharesave is open to all employees on the UK payroll. Participants may elect to save up to £250 per month under a three-year savings contract. An option is
granted by the Company to buy shares at a discount of 20% from market price at the time of the grant. At the end of the savings period, a tax-free bonus is
applied to the savings and the option becomes exercisable for a period of six months. Employees who are not paid through the UK payroll may save under
similar terms and conditions, albeit without tax benefits.
Share incentive plan
The share incentive plan is open to all employees on the UK payroll. Participants may invest up to £1,500 of their pre-tax salary each year to purchase
partnership shares in easyJet. For each partnership share acquired easyJet purchases a matching share. Employees must remain with easyJet for three years
from the date of purchase of each partnership share in order to qualify for the matching share, and for five years for the shares to be transferred to them tax
free. The employee is entitled to dividends and to vote at shareholder meetings. Employees who are not paid through the UK payroll may save under similar
terms and conditions, albeit without tax benefits.
In October 2006 and December 2007, easyJet also awarded free shares to all employees under the share incentive plan.
Long term incentive plan
The plan is open, by invitation, to Executive Directors and senior management, and provides for annual awards of performance shares worth up to 200%
of salary each year and matching shares linked to the investment of up to 50% of annual bonus in easyJet shares. The vesting of these awards is dependent
on return on equity targets being achieved.
Chief Executive recruitment award
In December 2005, on Andrew Harrison acquiring and retaining £1,000,000 worth of easyJet shares using his own funds, he was granted an equal number
of shares with a three-year vesting period. Half of the award is subject to performance conditions relating to the growth in EPS over the three years to
September 2008. The other half is subject to the same return on equity targets as the 2005 long term incentive plan award. During the year 50% of the
award related to growth in EPS and 67% of the award related to return on equity vested.
The weighted average remaining contractual life for each class of share award is as follows:
Years
Pre-flotation scheme 0.5
Discretionary schemes 5.1
Sharesave 2.5
Share incentive plan 3.0
Long term incentive plan 2.2
In accordance with the provisions of IFRS 2, fair values have not been calculated for grants of share options that occurred before 8 November 2002.
Exercise prices for these options lie between £1.61 and £3.65.