Page 32 - Suncorp_Review

30

2. Remuneration – audited (continued)

2.6 Contractual arrangements (continued)

The performance period for each LTI tranche is summarised in the table below.

TRANCHE 1 TRANCHE 2 TRANCHE 3

–– Performance period began: 1 October 2009

–– Performance period ends on either: 30 September 2012 (initial period), 30 September 2013 (second period) or 30 September 2014 (fnal period)

–– At the end of the initial period, the Group CEO can elect to accept the performance result or extend the performance period for a further 12 months

–– If the initial period is extended, the Group CEO can elect to accept the performance result at the end of the second period or extend the performance period for a further 12 months

–– If the second period is extended, the number of shares to be allocated at the end of the fnal period will be based on the highest performance measure result recorded at the end of any of the prescribed performance periods for tranche 1

–– Performance period began: 1 October 2009

–– Performance period ends on either: 30 September 2013 (initial period) or 30 September 2014 (fnal period) –– At the end of the initial period for tranche 2, the Group CEO can elect to accept the performance result or extend the performance period for a further 12 months

–– If the initial period is extended, the number of shares to be allocated at the end of the fnal period will be based on the highest performance measure result recorded at the end of any of the performance periods for tranche 2

–– Performance period began: 1 October 2009 –– Performance period ends:

30 September 2014

Senior Executives

Senior Executives are employed either by Suncorp Staff Pty Limited or Vero Insurance New Zealand Limited, both of which are wholly‑owned subsidiaries of the Company, under a standard employment contract with no fxed term with the exception of Mr Stribling whose contract provides for a two‑year term.

Senior Executives’ contracts may be terminated at any time provided that the notice period is given or paid out in lieu, based on benefts base (fxed remuneration less superannuation contributions) plus the value of other accrued benefts. Exceptions to this, where payments in lieu of notice are based on a percentage of fxed remuneration, are noted in the table below, which outlines the terms and conditions of Senior Executives’ contracts. Key terms of Senior Executives’ contracts

SENIOR EXECUTIVE

NOTICE ON RESIGNATION (EMPLOYEE‑INITIATED)

NOTICE ON TERMINATION (EMPLOYER‑INITIATED)

REDUNDANCY REMUNERATION (INCLUDING NOTICE)

STI PAYMENT ON

TERMINATION 1 LTI ON TERMINATION 2

Standard terms

All Senior Executives 3 months 12 months 12 months Board discretion Pro‑rata if qualifying

reason

Exceptions

Geoff Summerhayes 3 months 12 months Greater of 12 months

or total beneft under the redundancy policy (maximum of 75 weeks including notice)

Board discretion Pro‑rata if qualifying

reason

Robert Stribling 3 months 12 months None Board discretion Treatment of

LTI entitlement dependent on when contract terminated 3

1 In the event of resignation, redundancy or retirement, the deferred STI portion will generally vest after the termination date in accordance with the deferral period and will be subject to potential ex‑post adjustment at the end of the deferral period.

2 LTI treatment on termination and situations where qualifying reasons may be applicable are outlined in full within section 2.3 of this report. 3 Treatment of LTI on termination for Mr Stribling varies according to when his contract is terminated:

– if his employment expires at the end of the initial two‑year appointment term (i.e. on 3 January 2012), any performance rights that have been granted

continue ‘on foot’ until the relevant vesting date

– if his employment is terminated for any other reason prior to the expiry of the initial two‑year appointment term, any performance rights that have not

yet vested will be forfeited; and

– if his employment continues after the end of the initial two‑year appointment term and is subsequently terminated, any performance rights that have

not yet vested will lapse if termination is not for a qualifying reason and if for a qualifying reason, the performance rights would vest on a pro rata basis.

Notice of termination by the Company is not required in the event of serious misconduct by the Senior Executive. Payment on termination will include payment of accrued annual leave and, where appropriate, long service leave.

Directors’ Report (continued)