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FLEXIGROUP LIMITED FINANCIAL REPORT 2011
Vesting conditions
Vesting condition 1
The performance hurdle set by the Board in relation to vesting condition 1 for each tranche is
based on total shareholder return (“TSR”) of the Company for the relevant performance period.
If the TSR of the Company equals:
• 10% or higher for the performance period between 1 July 2008 to 1 July 2009 (“
performance
period 1
”); or
• 15% or higher for the performance periods between 1 July 2009 to 30 June 2010
(“
performance period 2
”) and 1 July 2010 to 30 June 2011 (“
performance period 3
”),
all of the deferred shares for the relevant tranche that are subject to vesting condition 1 will vest.
The TSR for performance periods 2 and 3 is determined by calculating the amount by which
the sum of the 30 day volume weighted average price (“
VWAP
”) for FlexiGroup’s ordinary
shares in the period up to and including 30 June (that is the end) of the relevant performance
period and the dividends paid on an ordinary share in FlexiGroup during the performance period
exceeds the 30 day VWAP for FlexiGroup’s ordinary shares in the period up to and including
1 July (that is the beginning) of the performance period, expressed as a percentage (note: there
was a minor typographical error in the 2008 Annual General Meeting notice of meeting between
the TSR start date and end date).
Vesting condition 2
The performance hurdle set by the Board in relation to vesting condition 2 for each Tranche is
based on TSR growth of the Company measured against other companies in the S&P/ASX 300
Index (not including resources companies) TSR growth for the relevant performance period.
TSR for the Company for a performance period will be measured in the same way as for vesting
condition 1. The same 30 day VWAP calculations will be used to determine the TSR for a
performance period of the other companies in the S&P/ASX 300 Index (not including resources
companies).
The performance hurdle for vesting condition 2 will be considered satisfed in accordance with
the following percentages of the tranches earned:
Nil
– if the Company’s TSR ranked in the 4th quartile (i.e. 76th to 100th ranking) of companies
in S&P/ASX 300 Index (excluding resources companies).
25%
– if the Company’s TSR equals performance of the 75th ranking company in the S&P/ASX
300 Index (excluding resources companies).
Pro-rata between 25% and 50%
– if the Company’s TSR ranked in the 3rd quartile (i.e. 51st to
75th ranking) of companies in the S&P/ASX 300 Index (excluding resources companies).
Pro-rata between 50% and 100%
– if the Company’s TSR ranked in the 2nd quartile (i.e. 26th
to 50th ranking) of companies in the S&P/ASX 300 Index (excluding resources companies).
100%
– if the Company’s TSR ranked in the 1st quartile (i.e. 1st to 25th ranking) of companies in
the S&P/ASX 300 Index (excluding resources companies).
Why vesting conditions
were chosen
The vesting conditions were chosen as performance conditions as they refect, at the date
they were granted, the generation of signifcant shareholder value.
Retention date
1 September 2011 at 5.00pm (Sydney time)
Distributions/Dividends Participants are entitled to receive distributions/dividends made in respect of the deferred
shares.
Performance period
Tranche 1 – Performance period 1 (being 1 July 2008 to 30 June 2009)
Tranche 2 – Performance period 2 (being 1 July 2009 to 30 June 2010)
Tranche 3 – Performance period 3 (being 1 July 2010 to 30 June 2011)
Disposal restriction
Deferred shares that vest in accordance with the applicable vesting conditions will be subject
to a restriction on disposal until the retention date of 1 September 2011.