EasyJet 2012 Annual Report Download - page 90

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Accounts & other information
Notes to the accounts
continued
18 Share incentive schemes continued
The fair value of grants under the discretionary and sharesave is estimated by applying the Binomial Lattice option pricing model using
the following key assumptions. The fair value of grants under all other schemes is the share price on the date of grant.
Grant date
Share
price
£
Exercise
price
£
Expected
volatility
%
Option life
years
Risk-free
interest rate
%
Fair
value
£
Discretionary schemes
19 January 2004 3.80 3.60 40% 6.5 4.62% 1.90
8 December 2004 1.81 1.84 42% 6.5 4.45% 0.88
Long Term Incentive Plan
16 January 2009 2.88 – – – – 2.88
16 December 2009 and 5 July 2010 3.49 – – – – 3.49
31 March 2011 3.41 – – – – 3.41
4 January 2012 3.92 – – – – 3.92
Sharesave
6 June 2008 2.86 2.40 41% 3.5 4.92% 1.16
5 June 2009 3.02 2.43 53% 3.5 2.52% 1.40
10 June 2010 4.36 3.49 53% 3.5 1.20% 1.96
1 July 2011 3.60 2.88 46% 3.5 1.45% 1.37
1 July 2012 5.23 4.18 35% 3.5 0.24% 1.77
Share price is the closing share price from the last working day prior to the date of grant.
Exercise price for the discretionary schemes was determined using a five-day weighted average price. For the Sharesave scheme,
exercise price is set at a 20% discount from share price.
Expected volatility is based on historical volatility over a period comparable to the expected life of each type of option.
Levels of early exercises and forfeitures are estimated using historical averages.
The weighted average fair value of matching shares granted under the share incentive plan during the year was £4.96 (2011: £3.81)
For grants under the Sharesave scheme after 30 September 2011, the dividend yield assumption is calculated based on the actual yield
at the date the options are granted. For the options granted on 1 July 2012, the dividend yield assumption was 2%.
easyJet plc
Annual report and accounts 2012
88