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Retrieving Data

Note 35

For the Year Ended 31 March 2011

EMPLOYEE SHARE BASED COMPENSATION
The Company has issued share options to certain employees. Each option issued under the Scheme converts to one ordinary share on exercise when employees are required to pay a non-refundable amount for the issue of the ordinary share (the exercise price). The options may be exercised any time after three years from issue date up until expiry, are non-transferable and conditional on the individual employee's continued employment through this period. The initial exercise price was set by taking the average closing market price of the shares during the ten business days up to and including the issue of the options. The exercise price is adjusted by an equity rate of return, dividends paid and capital structure changes from issue date up until the point at which the employee exercises the option.
 
  NUMBER EXERCISE PRICE $
2011 2010 2011 2010
Options Outstanding:
Tranche A issued November 2003, expiring February 2009 - - - -
Tranche B issued May 2004, expiring August 2010 - - - -
Tranche C issued November 2004, expiring February 2010 - - - -
Tranche D issued May 2006, expiring June 2012 280,000 280,000 8.33 8.01
280,000 280,000
Options Exercised to Date:
Tranche A 520,000 520,000 3.04 3.04
Tranche B 60,000 60,000 4.85 4.85
Tranche C 420,000 420,000 6.10 6.10
Tranche D - - - -
1,000,000 1,000,000
Options Lapsed to Date:
Tranche A 60,000 60,000
Tranche B - -
Tranche C 100,000 100,000
Tranche D 180,000 180,000
340,000 340,000
   

Members of the Parent's executive management team and certain other employees (together defined as key management personnel) are eligible to receive payment under two cash settled share based payments schemes. The schemes are defined as follows:

Scheme one

An incentive scheme for key management personnel of the Parent was implemented on 15 November 2008. This is a cash-settled share-based payment scheme covering the three-year period to 15 November 2011.

Scheme two

An incentive scheme for key management personnel of the Parent was implemented on 15 May 2009. This is a cash-settled share-based payment scheme covering the three-year period to 15 May 2011. Additionally each year on the 15th of May, a new tranche of the scheme may be issued at the discretion of the Board that covers a period of three years from the issue date.

Calculation of payment

Scheme one

Key management personnel are eligible to receive an annual bonus payment during the period of the scheme, the sum of which is determined by the total return on a notional number of allocated shares. The return is calculated as the sum of dividends paid by the Parent plus the increase in share price over the period. Payment is only made if a minimum return, set by the Board, is met. Additionally the scheme has a set maximum return above which no increase in bonus is received by the participants. The total return is calculated for a one year period commencing on the 15th of November with reference to the share price at the date of the scheme closing.

Scheme two

Key management personnel are eligible to receive a bonus payment at the end of the three year period of the scheme, the sum of which is determined by the total return on a notional number of allocated shares. The return is calculated as the sum of dividends paid by the Parent plus the increase in share price over the period. Payment is only made if a minimum return, set by the Board, is met. Additionally the scheme has a set maximum return above which no increase in the bonus is received by the participants. The total return is calculated for a three year period commencing on the 15th of May with reference to the average share price over the ten days prior to the scheme closing.

The fair value of the liability at 31 March 2011 has been determined by reference to the Parent's current share price and expected dividends and share price movements with comparison to the share price at the start of the relevant period and adjusted to reflect the present value of these future expected cash flows.
For the year ended 31 March 2011 the total expense recognised in the income statement was $40,000 (2010: $14,000) and the liability recognised in the statement of financial position as at 31 March 2011 is $54,000 (2010: $14,000).