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50 Independence Group NL
DIRECTORS’ REPORT
Directors' report
30 June 2016
(continued)
Remuneration report (continued)
2016 Executive remuneration (continued)
Variable remuneration - LTIs (continued)
The number of share rights able to be issued under the PRP is limited to 5% of the issued capital. The 5% limit includes
grants under all plans made in the previous five years (with certain exclusions under the
Corporations Act 2001).
This
percentage now stands at 1.1%. There are no voting or dividend rights attached to the share rights.
Share rights granted after 1 July 2014
Vesting of the share rights granted to executive KMP after 1 July 2014 is based on a continuous service condition and a
total shareholder return (TSR) scorecard.
Service condition
The service condition is met if employment with IGO is continuous for three years commencing on or around the grant
date. The condition is aimed at retaining key personnel.
The treatment of LTI awards of executives, whose employment ceases prior to vesting, depends on the reason for
cessation and is subject to Board discretion to determine otherwise. If, in the opinion of the Board, the executive acts
fraudulently or dishonestly, or is in material breach of his or her obligations to any Group entity, then the Board in its
absolute discretion may determine all the executive's unvested share rights will lapse and the Board's discretion will be
final and binding.
Performance condition
The TSR scorecard for the three year measurement period will be determined based on a percentile ranking of the
Company's TSR results relative to the TSR of each of the companies in the peer group over the same three year
measurement period. Reflecting on market practice, the Board considers that relative TSR is an appropriate
performance hurdle because it ensures that a proportion of each participant’s remuneration is linked to the return
received by shareholders from holding shares in a company over a particular period. There is no re-testing provision of
the TSR performance condition following the initial testing at the end of the three year measurement period.
The peer group is to comprise the constituents of the S&P ASX 300 Metals and Mining Index who are engaged in gold
and/or base metals mining in Australia and have the closest market capitalisation to the Company.
The vesting schedule of the share rights subject to relative TSR testing is as follows:
Relative TSR performance
Level of vesting
Less than 50th percentile
Zero
Between 50th and 75th percentile
Pro-rata straight line percentage between 50% and 100%
75th percentile or better
100%
The Company's TSR performance for share rights issued during FY16 will be assessed against the following 20 peer
group companies:
Peer Group
Aditya Birla Minerals Ltd
1
Alacer Gold Corp.
Beadell Resources Ltd
Cudeco Ltd
Evolution Mining Limited
Kingsgate Consolidated Limited
Medusa Mining Ltd
Metals X Limited
Mincor Resources NL
Northern Star Resources Limited
Oceana Gold Limited
Oz Minerals Ltd
Panoramic Resources Ltd
Perseus Mining Limited
Regis Resources Limited
Resolute Mining Limited
Saracen Mineral Holdings Limited Sandfire Resources Ltd
Silver Lake Resources Limited
Western Areas Ltd
1. To be removed from peer group of companies following takeover of the company.
Share trading policy
The trading of shares issued to participants under the PRP is subject to, and conditional upon, compliance with the
Company’s Dealing in Securities Standard. The Standard also prohibits all employees, including Directors and senior
management, from entering into any hedging arrangement over unvested securities issued pursuant to any share
scheme, performance rights plan or option plan.
Independence Group NL
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