Director/PDMR Shareholding

RNS Number : 8547Z

GlaxoSmithKline PLC

24 July 2008

 

Notification of Transactions of Directors and Persons Discharging Managerial

Responsibility

Awards made by GlaxoSmithKline

On 23 July 2008 the Company granted certain share-based awards to Directors and Persons Discharging Managerial Responsibility. The following awards were made:

• Awards under the GlaxoSmithKline Performance Share Plan, which are subject to performance conditions; and

• Awards under the GlaxoSmithKline Share Option Plan, which are subject to performance conditions; and

The Performance Share Plan and the Share Option Plan were both approved by shareholders on 31 July 2000, and allow awards to be made to senior executives in the Group, including the Executive Directors.

The details of these awards are shown below.

Performance Share Plan

Under the terms of the GlaxoSmithKline Performance Share Plan, contingent awards are granted over a designated number of Ordinary shares or American Depository Shares (ADSs), with the percentage of awards ultimately vesting depending on performance. The performance condition applies over a three-year measurement period, which commenced on 1 January 2008 and will end on 31 December 2010.

The performance condition for these awards compares the Total Shareholder Return (TSR) of GSK's shares with the TSR of the shares of 14 comparator companies over the three-year period. No awards will vest if GSK delivers returns which, when ranked against these companies, rank below the median.  If GSK delivers returns which rank at the median, 35% of the award will vest.  Vesting increases on a sliding scale with 100% of the award vesting where the Company is ranked first or second when compared to the comparator group.

TSR is measured on a pro-rata basis. Where the Company's performance falls between two of the comparator companies, the exact level of vesting will be determined by the actual relative level of TSR rather than simple ranking. To the extent that an award does not vest, it lapses.

The companies in the comparator group are Abbott Laboratories, AstraZeneca, Amgen, Bristol-Myers Squibb, Eli Lilly & Co, Johnson & Johnson, Merck, Novartis, Pfizer, Roche, Sanofi-Aventis, Schering-Plough, Takeda Pharmaceutical Company and Wyeth.

The individuals in the table below, who are either an Executive Director or Person Discharging Managerial Responsibility (PDMR), were each granted an award under the terms of the GlaxoSmithKline Performance Share Plan as set out below. The awards were granted over the Company's 25p Ordinary shares.

Dividends accrue on the shares during the vesting period and vest to the extent that shares vest.

  Number of Ordinary shares potentially vesting

	Less than median	Equal to median	Equal to 7th position	Equal to 6th position	Equal to 5th position	Equal to 4th position	Equal to 3rd position	Equal to or above 2nd  position
Mr A P Witty*	Nil	21,700	31,000	37,200	43,400	49,600	55,800	62,000
Mr S A Hussain	Nil	15,721	22,459	26,950	31,442	35,934	40,425	44,917

* denotes an Executive Director

The vesting of these awards is subject to the Remuneration Committee having determined that the performance conditions have been satisfied.

Share Option Plan

Under the terms of the GlaxoSmithKline Share Option Plan, share options allow the holder to buy Ordinary shares or ADSs at a future date at a price determined by reference to the market price of shares at the time of grant. The ultimate number of share options that become exercisable depends on GSK's earnings per share (EPS) growth over the performance period. EPS is measured over the three financial years that started on 1 January 2008 and end on 31 December 2010. To the extent that options under the GlaxoSmithKline Share Options Plan do not vest at the end of this period, they will lapse.

The performance condition compares the compound annual increase in the Company's EPS with the increase in the Retail Price Index (RPI) over the performance period compared to the base year (the financial year ended 31 December 2007). No options vest unless the Company's EPS increase exceeds RPI by 3% per annum. 50% of the share options vest for an EPS increase of 3% p.a. in excess of RPI, with increasing vesting up to 100% for an increase of 6% p.a. or more in excess of RPI.

Vesting increases on a straight-line basis for EPS performance between the hurdles set out in the tables below.

The individuals in the table below, who are either an Executive Director or a PDMR, were each granted an award under the terms of the GlaxoSmithKline Share Option Plan as set out below with an exercise price of £12.205. The options were granted over the Company's 25p Ordinary shares. 

Number of Ordinary shares potentially vesting

	Less than RPI +3%	RPI +3%	RPI +4%	RPI +5%	RPI +6% or more
Mr A P Witty*	Nil	72,500	96,667	120,833	145,000
Mr S A Hussain	Nil	51,771	69,028	86,285	103,542

* denotes an Executive Director

The vesting of these options is subject to the Remuneration Committee having determined that the performance conditions have been satisfied.

The Company, Directors and Persons Discharging Managerial Responsibility were advised of these transactions on 23 July 2008.

This notification is made in accordance with Disclosure and Transparency Rule 3.1.4R(1)(a).

S M Bicknell

Company Secretary

24 July 2008

Enquiries:

UK Media enquiries:                              Philip Thomson       [phone]

              Alice Hunt                [phone]

              Gwenan White        [phone]

US Media enquiries:                              Nancy Pekarek       [phone]

              Mary Anne Rhyne   [phone]

European Analyst/Investor enquiries:   David Mawdsley     [phone]

              Sally Ferguson       [phone]

              Gary Davies           [phone]

US Analyst/ Investor enquiries:             Frank Murdolo        [phone]

              Tom Curry              [phone]

 

END

 

 

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