Directors’ conditional awards
The following directors held conditional awards over ordinary shares of the Company granted under the British Airways Long Term Incentive Plan (LTIP) and the British Airways Performance Share Plan (PSP). The LTIP operated from 1996 to 2004 and was replaced by the PSP in 2005.
| Plan | Date of award | Number of awards as at April 1, 2007 | Awards vesting during the year | Options exercised during the year | Market price at date of exercise £ | Gain made on exercise £ | Awards lapsing during the year | Awards made during the year | Number of awards as at March 31, 2008 | |
|---|---|---|---|---|---|---|---|---|---|---|
| Willie Walsh | PSP | Aug 30, 2005 | 319,148 | 319,148 | ||||||
| PSP | Nov 24, 2006 | 185,950 | 185,950 | |||||||
| PSP | Aug 9, 2007 | 254,854 | 254,854 | |||||||
| Total | 505,098 | 254,854 | 759,952 | |||||||
| Keith Williams | LTIP | Jun 9, 2003 | 46,631 | 46,631 | ||||||
| LTIP | Jun 16, 2004 | 29,788 | 22,141 | 7,647 | 22,141 | |||||
| PSP | Aug 30, 2005 | 34,219 | 34,219 | |||||||
| PSP | Nov 24, 2006 | 77,479 | 77,479 | |||||||
| PSP | Aug 9, 2007 | 125,910 | 125,910 | |||||||
| Total | 188,117 | 22,141 | 7,647 | 125,910 | 306,380 |
LTIP awards were subject to the Company’s TSR performance relative to the constituents of the FTSE 100. No awards would have vested for below median performance. For awards granted in 2003 and 2004, 30 per cent vest for median performance, 65 per cent would have vested for upper quartile performance and 100 per cent would have vested for upper decile performance.
- In respect of awards granted in 2003, the Company was the 13th highest performing company out of the 93 remaining FTSE 100 companies over the performance period April 1, 2003 to March 31, 2006. This placed the Company on the 86th percentile meaning that 90.67 per cent of the shares originally awarded vested and the remainder of the award lapsed; and
- In respect of awards granted in 2004, the Company was the 20th highest performing company out of the 92 remaining FTSE 100 companies over the performance period April 1, 2004 to March 31, 2007. This placed the Company on the 79th percentile meaning that 74.33 per cent of the shares originally awarded vested and the remainder of the award lapsed.
Upon vesting of the LTIP awards, the Remuneration Committee having considered in both cases that underlying financial performance was satisfactory, participants were granted nil-cost options in accordance with the rules of the scheme. Options are exercisable for seven years from the date of vesting of the relevant LTIP award. No payment is due upon the exercise of these options.
PSP awards granted in 2005, 2006 and 2007 are subject to the performance conditions outlined earlier in this report on page 2. In each case, the performance conditions will be measured over a single three-year performance period, which begins on April 1 prior to the award date. 50 per cent of the award is subject to TSR performance measures against a group of airlines, and 50 per cent is subject to average operating margin performance.
The award granted in 2005 was tested at the end of 2007/08. As a result, none of the shares subject to the TSR performance condition will vest, and 31.25 per cent of the award will vest based on the operating margin performance condition. Taking the TSR performance condition and operating margin performance together, 31.25 per cent of the total original award will vest on the third anniversary of the award, August 30, 2008.
The value attributed to the Company’s ordinary shares in accordance with the plan rules on the date of the 2007 PSP award, (August 9, 2007), was 412 pence.