Peachtree 2015 Annual Report Download - page 148

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The Sage Group plc | Annual Report & Accounts 2015
146
Net debt and capital structure continued
14 Equity continued
14.2 Share-based payments continued
A reconciliation of option movements over the year is shown below:
2015 2014
Number
’000s
Weighted
average
exercise
price
£
Number
’000s
Weighted
average
exercise
price
£
Outstanding at 1 October 2,339 2.41 3,492 2.33
Forfeited (75) 2.63 (63) 2.29
Exercised (1,502) 2.30 (1,090) 2.20
Outstanding at 30 September 762 2.58 2,339 2.41
Exercisable at 30 September 762 2.58 2,339 2.41
2015 2014
Weighted average
remaining life years
Weighted average
remaining life years
Range of exercise prices £ Expected Contractual Expected Contractual
2.14 – 2.70 – 1.0 – 1.4
The weighted average share price during the period for options exercised over the year was 477.8p (2014: 387.8p).
The Sage Group Performance Share Plan
Annual grants of performance shares will normally be made to executive directors and senior executives across the Group after the
preliminary declaration of the annual results. Under the Performance Share Plan 5,411,495 (2014: 5,519,987) awards were made during
the year.
Awards prior to 2013
Annual awards under the Plan were limited to shares worth up to 300% of base salary. In practice, annual grants to executive directors
were limited to shares with a maximum value on award of 210% of base salary except in exceptional circumstances, such as a promotion
or recruitment or to reflect local market practice.
The performance shares were subject to performance conditions on a sliding scale based on EPS. 25% of the award vested at the end of
the period if the increase in EPS exceeded RPI by 9% (an average of 3% per year); 100% of the award vested at that time only where RPI
was exceeded in that period by 27% (an average of 9% per year). Between those targets, awards vested on a straight-line basis, and if those
targets were not met there was no opportunity for re-testing. Awards were then subject to a total shareholder return (TSR) “multiplier”
whereby the level of vesting based on EPS achievement was adjusted according to TSR performance over the same three-year period
compared with a group of international software and computer services companies.
The comparator group for awards made in 2012 comprised the following companies:
– Adobe Systems – Cegid – Logica – Salesforce.com
– ARM Holdings – Dassault Systèmes – Micro Focus International – SAP
– Blackbaud – Exact – Microsoft – Software AG
– Cap Gemini – Intuit – Oracle
If Sage’s TSR was ranked at lower quartile in the group, the multiplier was 0.75. If Sage’s TSR was ranked at median in the group, the multiplier
was 1. If Sage’s TSR was ranked at upper quartile in the group, then the multiplier was 1.5. Straight-line pro-rating applied between 0.75 and 1,
and between 1 and 1.5, but the multiplier could not be higher or lower than these figures.