As at 31 December 2019, notifiable shareholdings including CFD positions were:
|Shares owned by other investors|
|The Capital Group Companies||61,073,765||1.48%|
|Standard Life Aberdeen||43,849,614||7.52%|
|Merian Global Investors||31,551,592||5.41%|
|Sands Capital Mgt||28,381,301||3.22%|
|Marathon Asset Mgt||18,771,822||3.22%|
|Total of +3% holdings||248,702,411||42.68%|
|Shares owned by directors and related parties||1,958,058||0.34%||*|
|Total shares in issue||582,739,946||100.00%|
The 2015 LTIP was approved by shareholders on 15 December 2015. Its rules are summarised on pages 325 to 329 of the prospectus published on 15 November 2015. The key terms of the scheme are:
- The total number of options allowed to be granted cannot exceed 10% of the issued share capital at the time of grant
- The options attract a dividend credit
- The grant price cannot be less than the market value of the shares at the time of grant
- Performance conditions apply – a comparator of TSR against the FTSE250
- The scheme has a 10 year life
On 1 May 2018, the following awards were outstanding:
|Grant price||Number of options currently unvested||Vesting conditions|
|Kenneth Alexander||£4.22||977,564||Vests on 2 August 20187|
|Paul Miles (1)||£4.22||38,889||as above|
|Lee Feldman (2)||£4.67||488,782||as above|
1. The Company has granted this option under the exemption to Listing Rule 9.4.1 contained in Listing Rule 9.4.2 (2). The rules governing the option are identical to the rules of the GVC 2016 Management Incentive Plan (“MIP”) except in respect of the latter’s eligibility provision and the rules of the MIP are identical to the 2015 LTIP practically in all key respects.
2. Due to certain limitations associated with the grant of options to individuals subject to U.S. federal income taxes, Lee Feldman’s Option is granted at a higher exercise price which represents the market value of the Shares as of the date at which the scheme became effective, being, £4.67. In order to compensate Lee Feldman for the higher exercise price, the Company has agreed to pay him a cash bonus of £1,979,567 (being £4.67 less £4.22 multiplied by 4,399,037 (the original number of shares under option)). This cash bonus is to be paid over the 30-month vesting period of the option, but only upon vesting and satisfaction of the performance condition described below. Mr Feldman has agreed to invest 50% of the after tax proceeds of the bonus in Shares.
3. 2017 LTIP
The GVC 2017 Long Term Incentive Plan (“LTIP”) was approved by shareholders at the General Meeting held on 14 December 2017. The following award were granted to Executive Directors in 2017:
Number of Shares subject to an award
The awards will normally vest on 28 December 2020 being the third anniversary of the Award Date subject to the satisfaction of the relative Total Shareholder Return (50%) and the cumulative Earning Per Share (50%) performance conditions.
Further information on the 2017 LTIP can be found in the Company’s EGM circular dated 21 November 2017 and in the Directors’ Remuneration Report contained in the 2017 Annual Report, both of which can be found here.
Lee Feldman stepped down from his role as Chairman of the Board and left the Company on 27 February 2020.
The Remuneration Committee have approved the following exit terms:
- Lee has waived the contractual right under his amended letter of appointment to a 12-month notice period and any associated payment in lieu of notice (i.e. there will be no further fees paid to Lee following his departure date of 27 February 2020).
- Lee has agreed to continue to serve on the Roar Digital, LLC board of directors, as one of GVC’s representatives until 31 December 2020, and to waive any fee for these services.
- In December 2017, Lee received a one-off fee as part of a move to bring his remuneration arrangements into line with best practice for non-executive chairman of FTSE250 companies. The net-of-tax fee was invested into GVC shares, half of which vested on 13 December 2019, and half of which are due to vest on 13 December 2020. Vesting was conditional on Lee continuing as Chairman throughout this period, which was the intention at that time. The revised UK Corporate Governance Code brought in new provisions around the length of tenure for board chairmen, with the result that Lee is standing down earlier than originally envisaged. Taking into account these circumstances, coupled with Lee agreeing to waive his contractual notice period and serve on the Roar Digital LLC board until December 2020 for no compensation, the Remuneration Committee determined to treat Lee as a good leaver for the second tranche of these shares. As such, 26,134 shares will vest and be released to him on 13 December 2020.
Full details will be provided in the 2019 Directors’ Remuneration Report.
After consulting with GVC’s Chairman and Remuneration Committee Chair, GVC’s Chief Executive Officer has volunteered to reduce his annual salary from £950,000 to £800,000. This offer was made in light of recent shareholder and proxy adviser feedback on GVC’s 2018 remuneration report and on our Remuneration Committee Chair. This change will take effect from 1 June 2019.
Paul Bowtell will retire as a Director of GVC Holdings Plc on 5 March 2019 and will remain an employee until 5 March 2019, during which time he will work on a variety of integration projects and undertake an orderly handover and transition of responsibilities.
The Remuneration Committee has determined that the following arrangements were fair and reasonable, consistent with the Directors’ Remuneration Policy and in line with Paul’s contractual entitlements.
- Paul remains eligible to receive an annual bonus in respect of 2018. He shall not be eligible for a 2019 annual bonus.
- Paul will be conferred eligible leaver status to allow him to retain his unexercised his 2018 long term incentive plan award post his termination. This award will continue to vest over the original vesting period i.e. there is no acceleration of vesting, and the award will remain subject to a) malus (i.e. the potential claw-back of any unvested element), b) the future satisfaction of performance measures, c) time apportionment based on service and d) the post vesting holding period.
Further details will be provided in the Directors’ Remuneration Report published next year
Post 2019 AGM Statement
Following on from the voting outcome on our Remuneration Report at the GVC Holdings PLC Annual General Meeting on 5 June 2019, this statement is intended to provide an update on the activities that the Remuneration Committee has been undertaking to further understand the reasons for the low vote.
The Committee places high importance on the opinions of our shareholders and other stakeholders when considering our remuneration policy and how it is implemented at GVC. We engaged extensively with shareholders ahead of the 2019 AGM and were naturally disappointed to receive a 41.96% vote against our remuneration report.
Since the AGM we have invited a broad selection of our shareholders and proxy voting agencies to meet with us so that we could listen to and fully understand their views on remuneration at GVC. Through this process the Remuneration Committee Chair met with or spoke to over 15 of our largest shareholders and key proxy agencies. Our Senior Independent Director also engaged with the Investor Forum during this process.
We would like to thank shareholders for the constructive tone of these meetings. It became clear that in general, where shareholders had felt unable to support the Remuneration Report, it had primarily been due to either the high 2018 single figure of remuneration, which resulted from vesting of legacy share awards which do not form part of our ongoing Remuneration Policy; the sale of shares by the CEO and Chairman in March 2019; or to the salary increase provided to the CEO during 2018 (which has been largely reversed during 2019). Looking forward, there was consensus that GVC’s Remuneration Policy is now more conventional, with a significantly reduced overall opportunity for the CEO.
The Committee has seen and discussed the feedback received during the consultation exercise and remains committed to active shareholder engagement going forward, which will be used to inform future decision-making. Our Remuneration Policy is due for renewal at our 2020 AGM, and we have contacted shareholders again to get their views on these proposals. We thank those who have already responded and will take all replies into consideration. At this stage, as the existing Policy reflects the market best practice at the time it was approved, and remains fit for purpose, it is envisaged that it will be largely unchanged. We will, of course, take the opportunity to update the Policy in response to developing practice following publication of the revised UK Corporate Governance Code in 2018.
Further details will be provided in 2019 Annual Report, and shareholders will have the opportunity to vote on the Remuneration Policy and the Remuneration Report in the usual manner at the 2020 AGM.
2018 AGM Follow-up
For details of GVC’s response to the 2018 AGM Resolution 2 Vote: Click here
Correction to 2018 Annual Report
There was an error in the related party note in the GVC 2018 accounts on page 153 in respect of the payments made to Lee Feldman. Up until the end of 2017 GVC paid Twin Lakes Capital, a company affiliated with Lee Feldman, a fee for office use of £50,000 a year under legacy arrangements. At the end of 2017, with the adoption of the current remuneration policy, the office services charge was terminated and the Chairman’s remuneration arrangements were simplified and he moved to an annual fee of £350,000. In 2018, this annual Chairman’s fee was paid to Twin Lakes Capital and during the preparation of the 2018 accounts this annual Chairman’s fee was incorrectly allocated in the related party note as “office services”. The correct disclosure in the related party note should have stated “nil” for 2018 in relation to office services.
As the Company is incorporated in the Isle of Man, the rights of shareholders may vary from those of a UK incorporated company. Details on those rights is shown in the Company’s articles which can be found elsewhere on this website. A summary of the shareholder rights, and Isle of Man corporate law, is included in page 254 (part 10, paragraph 5) of the Prospectus published in February 2018.
As a company traded on the London Stock Exchange and incorporated in the Isle of Man, GVC Holdings PLC is subject to the UK City Code on Takeovers and Mergers.
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