186 / 248
NOTES TO THE GROUP ANNUAL FINANCIAL STATEMENTS
CONTINUED
For the year ended 31 May 2015
184
BLUE LABEL INTEGRATED ANNUAL REPORT 2015
32.
EQUITY COMPENSATION BENEFIT
Forfeitable shares
During the year 2 937 836 (2014: 2 782 541) forfeitable shares were granted to executive directors
and qualifying employees (participant). The participant will forfeit the forfeitable shares if he/she
ceases to be an employee of an employer company before the vesting date or if the specified
performance conditions have not been met, unless otherwise specified by the rules or determined by
the Board. In the event that the participant is not in the employ of the Group, or the performance
conditions are not met, the shares allocated to the participant will be forfeited and will either be sold
on the open market by the escrow agent and the proceeds will be returned to the participating
employer, or may be retained by the Group for future awards.
Dividends declared in respect of these forfeitable shares are held in escrow until such time as the
performance conditions are met and the shares have vested. Shares forfeited during the vesting period
will forfeit any dividends pertaining to such shares. A dividend of 27 cents (2014: 25 cents) per
ordinary share was declared on 19 August 2014 (2014: 18 August 2013).
The performance condition for the fourth award of forfeitable shares vesting on 31 August 2014 is as
follows:
•
•
25% of the shares constituting the allocation are awarded for retention purposes and shall vest if
the employee is still employed within the Group at the vesting date (31 August 2014).
•
•
25% of the shares constituting the allocation will vest on the achievement by individual employees
of their individual key performance indicators.
•
•
50% of the shares constituting the allocation will vest if the Group’s core HEPS are equal to or
exceed the core HEPS per ordinary share at the beginning of the performance period, 1 June 2011,
by the percentage change in the CPI over the performance period, plus 15%. There is no linear
vesting to this portion of the allocation.
The performance condition for the fifth award vesting on 31 August 2015 of forfeitable shares is as
follows:
•
•
40% of the awards are allocated towards retention. In order to receive this portion of the allocation
the employee is required to be employed within the Group at the vesting date (31 August 2015).
•
•
60% of the awards are allocated on the basis of 50% for growth in core headline earnings per
share and 10% for shareholder returns.
The 50% for growth in core headline earnings will be based on the following achievements:
•
•
If growth is 5% above CPI over three years, 20% of the 50% will vest.
•
•
If growth is 10% above CPI over three years, an additional 50% (i.e. a total of 70%) of the 50%
will vest.
•
•
If growth is 25% above CPI over three years, a further 30% (i.e. a total of 100%) of the 50%
will vest.
The 10% for shareholder return will be based on a 10% compounded growth in the share price over
the three-year vesting period measured with reference to the weighted average price per share during
the month of the commencement of the allocation and the weighted average share price for the
month during which the vesting takes place, plus dividends over the three-year period.