

30.	SHARE CAPITAL AND SHARE OPTIONS

Our ordinary shares are listed on the Nasdaq Stock Exchange. We delisted from the Oslo Stock Exchange on August 30, 2012.

As at December 31, 2013 and 2012, our authorized and issued share capital is as follows:

Authorized share capital:



(in thousands of $, except per share data)	2013	2012
100,000,000 common shares of $1.00 each	100,000	100,000

Issued share capital:



(in thousands of $, except per share data)	2013	2012
80,579,295 outstanding issued common shares of $1.00 each (2012: 80,503,364)	80,580	80,504

We issued 0.1 million and 0.3 million common shares upon the exercise of stock options in December 31, 2013 and 2012, respectively. In addition, a further 11.6 million shares were issued in 2011 in relation to the acquisition of the non-controlling interest in Golar Energy.

Treasury shares

In November 2007, our board of directors approved the buyback of up to a maximum of 1.0 million shares in the Company. As at December 31, 2013, a further 0.3 million shares in the Company maybe repurchased. The holding of treasury shares was held in connection with our share options plans.

The number of treasury shares held by us is as follows:



(Number of shares in thousands)	2013	2012	2011
At January 1	—	—	150
Disposed of during the year	—	—	(150	)
At December 31	—	—	—

Share options

Golar share options

In July 2001, our board of directors approved the grant of options to eligible employees to acquire an aggregate 2.0 million shares in the Company. In July 2001, we granted 0.4 million share options to certain directors and officers. The options vested in July 2002, and have a ten year term. As of December 31, 2013, these options have all been exercised.

In February 2002, our board of directors approved the Golar LNG Limited Share Option Scheme ("Golar Scheme"). The Golar Scheme permits the board of directors, at its discretion, to grant options to acquire shares in the Company to employees and directors of the Company or its subsidiaries. Options granted under the scheme will vest at a date determined by the board at the date of the grant. The options granted under the plan to date have five year terms and vest equally over a period of three to four years. There is no maximum number of shares authorized for awards of equity share options, and either authorized unissued shares or treasury shares in the Company may be used to satisfy exercised options.

In connection with the delisting of Golar Energy, previously granted options for 5.4 million shares in Golar Energy were cancelled in May 2011 and concurrently replaced with 0.9 million new options in Golar. There were no changes in the terms of the options except that the exchange of shares was equal to one Golar share for every 6.06 Golar Energy share. This was accounted for as a modification of previous awards of equity instruments. However, we recorded no difference between the total incremental cost of the original and modified options as the fair value of the options modified was below the fair value of the original options granted.

As at December 31, 2013, 2012 and 2011, the number of options outstanding in respect of Golar shares was 0.5 million, 0.6 million and 0.8 million, respectively.

Golar Energy share options

In August 2009, the board of directors of our subsidiary, Golar Energy approved the Golar LNG Energy Share option Scheme ("Energy Scheme"). The terms of the Energy Scheme follow that of the Golar Scheme.

In June 2011, in connection with the delisting of Golar Energy, previously granted options for 5.4 million shares in Golar Energy were cancelled and concurrently replaced with new options in Golar (as discussed above). Accordingly, as of December 31, 2013, 2012 and 2011, there were nil options outstanding under the Energy Scheme.

The fair value of each option award is estimated on the grant date or modification date using the Black-Scholes option pricing model. The weighted average assumptions used are noted in the table below:



	2013		2012		2011
Risk free interest rate	2.0	%	2.0	%	1.8	%
Expected volatility of common stock	56.9	%	56.9	%	53.2	%
Expected dividend yield	0.0	%	0.0	%	0.0	%
Expected life of options (in years)	2.6 years		2.6 years		2.6 years

The assumption for expected future volatility is based primarily on an analysis of historical volatility of our common stock. We use the simplified method for making estimates as to the expected term of options, based on the vesting period of the award and represents the period of time that options granted are expected to be outstanding. The dividend yield has been estimated at 0.0% as the exercise price of the options, granted in 2006 and later, are reduced by the value of dividends, declared and paid on a per share basis.

A summary of option activity (including Golar Energy options prior to cancellation in May 2011) as at December 31, 2013, 2012 and 2011, and changes during the years then ended are presented below:



(in thousands of $, except per share data)	Shares (In '000s)		Weighted average exercise price		Weighted average remaining contractual term (years)
Options outstanding at December 31, 2010	7,279		$	2.96	2.0
Exercised during the year	(1,604	)	$	7.46
Forfeited during the year	(285	)	$	5.43
Options exchanged
- Golar Energy options exchanged and cancelled	(5,438	)	$	1.95
- Golar LNG options issued	897		$	11.84
Options outstanding at December 31, 2011	849		$	10.11	1.2
Exercised during the year	(267	)	$	1.54
Forfeited during the year	(1	)	$	8.54
Options outstanding at December 31, 2012	581		$	7.86	0.8
Exercised during the year	(76	)	$	8.01
Forfeited during the year	(7	)	$	6.58
Options outstanding at December 31, 2013	498		$	6.36	0.3



Options exercisable at:
December 31, 2013	409	$	6.50	0.1
December 31, 2012	323	$	8.46	0.3
December 31, 2011	299	$	9.94	0.3

The exercise price of all options except for those issued in 2001, is reduced by the amount of the dividends declared and paid; the above figures for options granted, exercised and forfeited show the average of the prices at the time of granting, exercising and forfeiting of the options, and for options outstanding at the beginning and end of the year, the average of the reduced option prices is shown.

The intrinsic value of share options exercised in the years ended December 31, 2013, 2012 and 2011 was $2.2 million, $6.3 million and $14.9 million, respectively.

As at December 31, 2013, the intrinsic value of share options that were both outstanding and exercisable was $14.9 million (2012: $16.8 million).

The total fair value of share options vested in the years ended December 31, 2013, 2012 and 2011 was $3.8 million, $4.8 million and $6.3 million, respectively.

Compensation cost of $0.5 million, $1.4 million and $2.0 million has been recognized in the Consolidated Statement of Operations for the years ended December 31, 2013, 2012 and 2011, respectively.

As of December 31, 2013, the total unrecognized compensation cost amounted to $0.2 million (2012: $0.6 million) relating to options outstanding is expected to be recognized over a weighted average period of 0.3 years.