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CIMIC Group Limited Annual Report 2016 |
Financial Report
Notes continued
for the 12 months to 31 December 2016
36. EMPLOYEE BENEFITS
CONTINUED
b) Share Appreciation Rights
Share Appreciation Rights – 2014 One-off Award to Marcelino Fernández Verdes (Executive Chairman)
Board approval was obtained on 11 December 2014 for the granting of share appreciation rights to Mr Fernández Verdes subject to a two
year vesting period. The share appreciation rights were granted at no cost to Mr Fernández Verdes and entitle Mr Fernández Verdes to
receive a cash payment reflecting the increase in value of the share price of the Company from the base share price of $17.71 to the share
price at close of trading on the last trading day before the share appreciation right is exercised, with a maximum payment per share
appreciation right of $32.29. The base price is the volume average weighted price of fully paid ordinary shares in CIMIC traded on the ASX
over the 30 day period before Mr Fernández Verdes’ appointment as CEO on 13 March 2014. All unvested or vested but unexercised share
appreciation rights are subject to forfeiture if Mr Fernández Verdes had ceased to be the CEO of CIMIC before 31 December 2014 or if he
does not remain a member of either the Executive Board or the Supervisory Board of HOCHTIEF for the period up to and including 13
March 2017. The share appreciation rights have vested in full on 13 March 2016 and are exercisable for three years from the date of
vesting. No more than 40% of the share appreciation rights can be exercised each year for the first two years after vesting, and any
remaining share appreciation rights can be exercised in the final year of the exercise period.
On 18 October 2016 Mr Valderas Martínez was appointed as CEO however Mr Fernández Verdes continues in his capacity as Executive
Chairman.
Amount recognised during the reporting period: Expense $13.7 million (31 December 2015: Expense $3.3 million).
Share Appreciation Rights - 2014 One-off Award to M Fernández Verdes
Date of grant
10 June 2014
Date of expiry
13 March 2019
Grant fair value
1
$16.76
Original grant
1,200,000
Unexercised rights
Unexercised rights at 31 December 2014
1,200,000
-
Granted
-
-
Exercised
2
-
-
Forfeited/Lapsed
-
Unexercised rights at 31 December 2015 and as at 31 December 2016
1,200,000
Exercisable rights
-
At 31 December 2015
-
-
At 31 December 2016
2
480,000
Non-exercisable rights
-
At 31 December 2015
-
-
At 31 December 2016
3
720,000
1
The fair value was re-evaluated on 31 December 2016 using Monte-Carlo simulation pricing models. Volatility in share prices and expected
dividend levels were estimated based on historic levels for a period consistent with the relevant performance period.
2
This represents 40% of the total vested share appreciation rights available to exercise in the first year from the date of vesting.
3
This represents 60% of the total vested share appreciation rights unavailable to exercise in the first year from the date of vesting.
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