Notes to the financial statements

* 5,074 shares were outstanding under the 2005 SAYE scheme as at 31 March 2009.

** Under the terms of the BSMP, a former director has also been given a promise to receive up to 0.9m shares as at 31 March 2009 (2008 – 0.9m).

Options over ICAP shares are issued at market price on the date of grant in the UCSOP and UESOP schemes. Those in the SEEPP UK and BSMP have a nominal exercise price of a £1.00 for the basic award and £1.00 for the matching award. The SEEP US options have an exercise price of $0.445. Options granted under the SAYE are issued with a 20% discount on market price as permitted by HMRC and those granted under the Traiana Plan were granted at the equivalent price to the original Traiana option. The awards under the LTIP have no exercise price.

All share options granted since 7 November 2002 are subject to IFRS2 “Share-based Payment”. A charge to the income statement based on the fair value of each option is made each year. The fair value of each option is calculated using the Black-Scholes option pricing model. The following assumptions have been applied when calculating the fair value of the options granted in the year:

Estimated share volatility is a measure of the amount by which the Company’s shares are expected to fluctuate during the life of an option. The expected volatility is estimated based on the historic volatility of the share price over the past three years to the date of grant of the option.

On options where the employee receives a cash bonus in lieu of the dividend foregone the dividend yield is treated as nil and the fair value of the option is equal to the market value of the share.

(i) Unapproved Share Option Plan (UESOP)

The UESOP is not approved by HMRC and is open to all executives. The grants of options have a maximum overall grant of four times annual salary including bonuses. Options do not vest until the Group has achieved certain performance criteria (currently growth in adjusted basic EPS in excess of growth in the RPI by an average of 3% per annum over a three-year period).

UESOP options were outstanding over 435,029 (2008 – 1,708,060) ordinary shares at exercise prices ranging between 42.4p and 263.0p per share. Subject to the Group’s performance during the vesting period, these options are exercisable between September 2002 and December 2014. No charge has been made to the income statement in the year (2008 – £0.1m) in respect of these options.

(ii) Sharesave scheme (SAYE)

The Save-As-You-Earn (SAYE) scheme is approved by HMRC. The scheme enables directors and eligible employees to acquire options over ordinary shares of the Company at a discount of up to 20% of their market price using the proceeds of a related SAYE contract. All UK employees who have worked for the minimum qualifying period on an invitation date are eligible to join the scheme. Options granted under the SAYE scheme are not subject to performance conditions.

2005 SAYE

SAYE options were outstanding over 5,074 (2008 – 787,208) ordinary shares for the 2005 three-year grant at an exercise price of 224.0p per share. Subject to the participants remaining in the employment of the Group and making 36 monthly contributions, these options will normally be exercisable between August 2008 and January 2009. A credit of £0.1m (2008 – charge £0.3m) was made to the income statement in respect of these options as a result of options lapsing in the year. A small number of shares remain outstanding as a result of contribution holidays taken during the normal contribution period.

2006 SAYE

SAYE options were outstanding over 945,544 (2008 – 1,176,600) ordinary shares for 2006 three-year grant at an exercise price of 388.0p per share. Subject to the participants remaining in the employment of the Group and making 36 monthly contributions, these options will normally be exercisable between August 2009 and January 2010. A charge of £0.5m (2008 – £0.7m) was made to the income statement in respect of these options in the year.

2007 SAYE

SAYE options were outstanding over 272,266 (2008 – 398,589) ordinary shares at an exercise price of 419.0p per share. Subject to the participants remaining in the employment of the Group and making 36 monthly contributions, these options will normally be exercisable between August 2010 and January 2011. A charge of £0.2m (2008 – £0.1m) was made to the income statement in respect of these options in the year.

2008 SAYE

SAYE options were granted over 666,661 ordinary shares on 18 June 2008 at an exercise price of 488.0p per share. Subject to the participants remaining in the employment of the Group and making 36 monthly contributions, these options will normally be exercisable between August 2011 and January 2012. A charge of £0.3m was made to the income statement in respect of these options in the year. As at 31 March 2009, options over 505,824 shares remained outstanding.

(iii) Senior Executive Equity Participation Plans (SEEPP)

The SEEPP is not approved by HMRC. The SEEPP is a long-term incentive plan where senior executives are invited to waive part of their potential cash bonus in return for rights over the number of shares that can be purchased with the foregone bonus at the market value of the Company’s shares on the date of grant (a basic award). Participants may also be granted a provisional allocation over additional shares (a matching award). These shares are transferred to the executive on a sliding scale if they remain in the Company’s employment as follows: no shares for up to three years; 40% following completion of three years, but less than four years; and the remaining 60% on the fourth anniversary of the date of grant. No performance criteria are attached to these options.

UK SEEPP

SEEPP options were outstanding over 1,440,278 (2008 – 1,186,036) ordinary shares at an exercise price of a nominal sum of 100.0p (2008 – 100.0p). Subject to the participants remaining in the employment of the Group during the vesting period, these options will normally be exercisable between December 2006 and May 2018. A charge of £0.7m (2008 – £0.5m) was made to the income statement in respect of the matching award in the year.

US SEEPP

SEEPP options were outstanding over 163,780 (2008 – 417,385) ordinary shares at an exercise price of 31.0p per share (2008 – 22.4p per share). All these options have vested and are exercisable before June 2009. All these options were granted before 7 November 2002 and therefore no charges have been made to the income statement in respect of these options.

(iv) Unapproved Company Share Option Plan (UCSOP)

The UCSOP is not approved by HMRC. Options may be granted to any eligible employee within the Group. No option may be granted to any individual at any time if, as a result, the aggregate number of shares issued or issuable to the individual under the plan would exceed 1,250,000. Options vest in three equal instalments on the third, fourth and fifth anniversaries of the date of grant, provided that, on the date of vesting, adjusted basic EPS growth exceeds growth in RPI by an average of 3% per annum over the preceding three years.

UCSOP options were outstanding over 5,041,900 (2008 – 5,067,100) ordinary shares at exercise prices ranging between 100.3p and 611.0p per share. Subject to the Company’s performance during the vesting period, these options will normally be exercisable between May 2004 and June 2018. A charge of £0.6m (2008 – £0.7m) has been made to the income statement in the year in respect of options granted since 7 November 2002.

(v) Bonus Share Matching Plan (BSMP)

The BSMP is not approved by HMRC. The BSMP is a long-term incentive plan where executive directors of the Company are required to waive 50% of their potential cash bonus in return for rights over the number of shares that can be purchased with the foregone bonus at the market value of the Company’s shares on the date of grant (a basic award). Participants are also granted a provisional allocation over an equal amount of additional shares (a matching award). These shares are transferred to the director if they remain in the Company’s employment for three years and the Group meets certain performance criteria – currently growth in adjusted basic EPS in excess of growth in RPI by at least 9% over the three years from the date of grant. The performance criteria apply to all grants since 1 April 2004.

BSMP options were outstanding over 9,680,299 (2008 – 7,993,197) ordinary shares. These shares are exercisable between 28 May 2006 and a date five years from the date the Group announces its results for the year ending 31 March 2011. A promise to deliver a further 867,930 (2008 – 923,430) ordinary shares has also been made by the Company. A charge of £4.6m (2008 – £3.4m) has been made to the income statement in respect of these options in the year.

(vi) Traiana Plan

The Traiana Plan was set up for the benefit of employees of Traiana who held options over Traiana shares prior to its acquisition by the Group in December 2007. The terms and conditions remain the same but the employees now hold options over ICAP shares in the ratio of 0.307 ICAP shares for each Traiana share option previously held. No further grants will be made under this scheme.

Share options vest over four years. After the first 12 months one quarter of the share options vest and thereafter the options vest on a monthly basis so long as the employee remains with the Group. Options may be exercised up to ten years after the date of grant. A total of 699,198 options remain outstanding at 31 March 2009 (2008 – 1,058,366). A charge of £0.7m (2008 - £0.2m) has been made to the income statement in respect of these options in the year.

(vii) Long Term Incentive Plan (LTIP)

The LTIP is not approved by HMRC. The LTIP is a long term incentive plan where senior executives of the Group are invited to waive 25% of their cash bonus in return for an award of the number of shares that can be purchased with the foregone bonus at the market value of the Company’s shares on the date of grant (a basic award). Participants are also granted a provisional allocation over an amount of additional shares equal to 20% of the basic award (a matching award). The basic award shares are transferred to the employee in equal annual instalments over three years, with the matching award shares being transferred with the final basic award, so long as the employee remains in the Group’s employment.

LTIP awards were granted over 968,105 ordinary shares in the year. These awards vest between 29 May 2009 and 29 May 2011. A charge of £0.3m has been made to the income statement in respect of these options in the year. As at 31 March 2009 913,020 options remain outstanding.