ICG bosses on course for 'catch up' shares bonus
Eamonn Rothwell, the chief executive of ferry group Irish Continental Group (ICG), is on course for a windfall after being awarded options of over 293,000 shares.
They will cost him slightly more than €19,000 but would be worth almost €1.7m - even at the current share price.
Bargain-basement awards made to Mr Rothwell and other ICG executives under a new performance plan - at 6.5 cent each - are effectively nil-cost, but represent a new strategy among PLCs for replacing previous share option formulas. ICG shares were at €5.46 yesterday.
Under legacy share option plans, all options might vest once specific targets are met.
But under new schemes such as ICG's, 30pc of options might vest if certain targets are met, but the remainder only vest if much more difficult to achieve goals are reached by executives, for instance.
ICG chief financial officer David Ledwidge has been awarded 100,000 options at the rock-bottom price, and Andrew Sheen, the managing director of ICG's ferries division, has been awarded 125,000. Declan Freeman, the managing director of its containers and terminals division, has received 100,000, while company secretary Tom Corcoran has been awarded 73,000.
Mr Rothwell had a total of 2.2m share options outstanding at the end of 2016 under the group's old performance plan, including 1.5m that are exercisable at €2.13 each.
At the company's annual general meeting last year, more than 31pc of votes cast rejected the group's remuneration report.
Rejection of a remuneration report is non-binding, but the opposition was sufficient to encourage the ICG board to review its pay and incentive structure.
It also made no awards under its 2009 share options plan to executives during 2016.
At ICG's AGM last week, shareholders approved a new performance share plan.
In granting the new share options to Mr Rothwell, who owns 14.9pc of the company, ICG said that the award "includes a catch-up amount in the absence of an award in 2016" for the former stockbroker. The vesting of the options is subject to performance conditions measured over a three-year period.
ICG has suspended its 2009 share plan for option granting, and replaced it with the new scheme approved last week.
ICG's latest annual report points out that between 1988 and 2016, ICG shareholders have increased the value of their investment 97-fold, compared to an 11-fold increase for the ISEQ and FTSE-100.