Annual Report 2010 - Ophir Energy

Notes to the
financial statements
6 share-based compensation
(a) employee incentive share plans
Ophir Energy Company Foundation Incentive Scheme
Ophir Energy Company Foundation Incentive Scheme was
established on 12 May 2004 shortly after the formation of
the Company to attract new employees on start up. The
plan provided for a total of 1,450,000 options to acquire
ordinary shares at 1p per share to be issued to eligible
employees. The Scheme was terminated on 24 November
2005 and all options issued under the scheme have
fully vested.
Ophir energy company limited 2006 share
Option plan
On 5 April 2006 the Board resolved to establish the Ophir
Energy Company Limited 2006 Share Option Plan.
Any employee of the Company or any Subsidiary or any
Director of the Company or any Subsidiary who is required
to devote to his duties substantially the whole of his
working time is eligible to participate under the plan.
At the grant date the Board of Directors determine the
vesting terms, if any, subject to the proviso that no more
than one half of the options become exercisable on the
first and second anniversaries of the date of grant and
any performance conditions are satisfied. Options have
an exercise period of 10 years from the date of grant.
The following table illustrates the number and weighted
average exercise prices (“WAEP”) of, and movements in,
share options during the period for both the above schemes.
These are denominated in Pounds Sterling and have been
translated to US Dollars using the closing exchange rate for
presentation purposes.
53
Ophir energy plc | 2010 ANNUAL REPORT
grOUp AccOUnTs | NOTEs TO THE fiNANCiAL sTATEmENTs
2010 nUMBer 2010 wAep
2009 nUMBer
2009 wAep
Outstanding options beginning of year
8,498,080 $2.60/£1.63 7,848,080
$2.46/£1.55
Granted during the year
-
- 800,000 $3.98/£2.50
Exercised during the year
(320,000)
$0.004/£0.0025
(50,000) $0.004/£0.0025
Lapsed during the year
(717,500)
$3.87/£2.50
(100,000)
$3.98/£2.50
Outstanding options at end of year
7,460,580 $2.50/£1.62
8,498,080
$2.60/£1.63
Exercisable at end of year
7,460,580
$2.50/£1.62 7,055,580
$2.31/£1.45
No options were granted during the year and no options
were exercised during the year (2009: Nil) or during the
subsequent period up to the date of these Financial
Statements.
The weighted average fair value of options granted during
the prior year was US$3.98. The range of exercise prices for
options outstanding at the end of the year was US$0.0040
to US$3.87 (2009: US$0.0040 to US$3.98) with a remaining
exercise period in the range of 3 to 9 years.
2010 2009
Dividend yield (%)
n/a -
Volatility (%) n/a 18.5
Risk-free interest rate (%) n/a 1.0
Expected life of option (years) n/a 2
Weighted average share price n/a £2.50 (US$4.16)
The fair value of equity-settled share options granted is
estimated as at the date of grant using a binomial model,
taking into account the terms and conditions upon which
the options were granted. The table to the right lists the
inputs to the model used for the year ended 31 December
2009. (No options were granted during in 2010.)