Tesco 1998 Annual Report Download - page 13

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1 1
Profit-sharing
The Group operates an approved employee profit-sharing scheme
for the benefit of all employees, including executive directors,
with over two years’ service with the Group at its year end.
Shares in the company are allocated to participants in the scheme
on a pro rata basis to base salary earned up to Inland Revenue
approved limits.
Executive incentive scheme
The company operates performance-related award schemes
designed to provide a growing element of variable reward to
reflect the performance of the Group.The executive incentive
scheme introduced in March 1993 was designed and introduced
for this purpose.
Long-term share bonuses are awarded annually, based on
improvements in earnings per share, achievement of strategic
corporate goals and comparative performance against peer
companies including total shareholder return.The maximum
long-term bonus is 25% of salary. Shares awarded have to be held
for a period of four years, conditional upon continuous service
with the company. The share equivalent of dividends which
would have been paid on the shares is added to the award during
the deferral period.
Short-term share bonuses are awarded annually, based on
improvements in earnings per share and on the achievement of
strategic corporate goals. The maximum short-term bonus
payable is 25% of salary, which is augmented by up to a further
121⁄2% of salary if the participants elect for the trustees of the
scheme to retain the fully paid ordinary shares awarded for a
minimum period of two years, conditional upon continuous
service with the company. The share equivalent of dividends
which would have been paid on the shares is added to the award
during the deferral period.
Mr T P Leahy
Mr D E Reid
Mr R S Ager
Mr J Gildersleeve
Mrs L James
Mr T J R Mason
Mr J M Wemms
Total
51,153
367,307
182,549
335,658
112,166
55,952
112,804
Ta ble 2 Gains made on share options Number of shares at exercise price (pence)
Date of grant 29/10/92 27/5/93 10/6/94 29/9/94
The value realisable from shares acquired on exercise is the difference between the fair market value at exercise and the exercise price of
the options, although the shares may have been retained.Where individual directors exercised options on different dates and sold the
shares, the price at exercise shown represents an average of the prices on these dates weighted to the number of options exercised.
Between 22 February 1997 and 6 June 1997, Lord MacLaurin exercised 27,650 share options with an exercise price of 217p, realising
a value of £40,093.
232
–
344,818
106,835
–
42,813
17,333
–
210
–
11,429
75,714
320,911
62,018
38,619
87,144
217
51,153
11,060
–
14,747
7,335
–
–
Price at
exercise
(pence)
461
477
422
385
418
416
407
1998
£000
125
903
363
585
223
111
228
Value realisable
1997
£000
–
–
56
–
19
–
31
217
–
–
–
–
–
–
25,660