BT 2007 Annual Report Download - page 124

31. SHARE BASED PAYMENTS continued
The BT Group Legacy Option Plan was launched on 17 December 2001 following the scheme of arrangement and demerger of O2 in
November 2001, and is therefore outside the scope of IFRS 2. Replacement unapproved options over BT Group shares were granted
to all participants in the executive option plans who had released their options over British Telecommunications plc shares. The value
of the replacement options was determined by averaging the combined prices of BT Group plc and O2 plc shares over the 20
dealing days following the demerger on 19 November 2001. This resulted in a factor of 1.3198 being applied to the former option
over British Telecommunications plc shares in order to give the number of BT Group shares under the new option. The option prices
of the original options were also adjusted to take account of the different number of shares under option. The options are
exercisable subject to continued employment and meeting corporate performance targets, on the third anniversary of the date of
grant.
For options outstanding at 31 March 2007, 2006 and 2005 in respect of the BT Group Global Share Option Plan and the BT
Group Legacy Option Plan, the weighted average exercise prices are shown below.
2007 2007 2006 2006 2005 2005
Number of
share
options
(millions)
Weighted
average
exercise
price
Number of
share
options
(millions)
Weighted
average
exercise
price
Number of
share
options
(millions)
Weighted
average
exercise
price
Outstanding at the beginning of the year 187 213p 206 213p 194 216p
Granted during the year ––– – 31 193p
Forfeited during the year (9) 222p (16) 205p (18) 193p
Exercised during the year (20) 203p (3) 199p – –
Expired during the year (55) 189p – – (1) 353p
Outstanding at the end of the year 103 227p 187 213p 206 213p
Exercisable at the end of the year 48 261p 57 280p 34 206p
Options were exercised regularly throughout the year.
The weighted average remaining contractual life of options exercisable at 31 March 2007 was 67 months (2006: 84 months,
2005: 80 months). The intrinsic value of options exercisable at 31 March 2007 was £37 million (2006: £8 million, 2005: £1 million).
The total intrinsic value of options exercised during the year was £23 million (2006: £nil, 2005: £nil). The intrinsic value of
options outstanding at 31 March 2007 was £96 million (2006: £46 million, 2005: £21 million). The total fair value of options
vested during the year was £8 million (2006: £8 million, 2005: £nil).
Outstanding options
Options outstanding under all share option plans at 31 March 2007, 2006 and 2005, together with their exercise prices and dates,
were as follows:
Normal dates of exercise
2007
Exercise price
per share
2007
Number of
options
(millions)
2006
Exercise price
per share
2006
Number of
options
(millions)
2005
Exercise price
per share
2005
Number of
options
(millions)
BT Group Employee Sharesave Plans
2005 ––– – 218p-255p 20
2006 ––154p-173p 20 154p-173p 22
2007 146p-227p 25 146p-227p 50 146p-227p 57
2008 154p-192p 99 154p-192p 103 154p 92
2009 146p-231p 75 146p 66 146p 71
2010 171p 38 171p 40 – –
2011 179p 35 ––––
Total 272 279 262
BT Group Legacy Option Plan
2001-2011 318-602p 12 318p-602p 14 318p-602p 15
Total 12 14 15
BT Group Global Share Option Plan
2005-2012 163p-263p – 163p-263p 45 163p-263p 51
2004-2014 176p-199.5p 76 176p-199.5p 100 176p-199.5p 110
2007-2015 179p-215p 15 179p-215p 28 179p-215p 30
Total 91 173 191
Total outstanding options 375 466 468
BT Group plc Annual Report & Form 20-F 123
Financial statements