Cue Energy Resources Limited Directors' report 30 June 2024 24 ● the ESOP sets out the framework for the offer of Options by the Company, and is typical for an ESOP; ● in making its decision to issue Options, the Board may decide the number of securities and the vesting conditions which are to apply in respect of the securities. The Board has flexibility to issue Options having regard to a range of potential vesting criteria and conditions; ● in certain circumstances, unvested Options will immediately lapse and any unvested Shares held by the participant will be forfeited if the relevant person is a “bad leaver” as distinct from a “good leaver”. Unless the Board determines otherwise at its sole discretion, Options held by good leavers will expire upon cessation of employment; ● if a participant acts fraudulently or dishonestly or is in breach of their obligations to the Company or its subsidiaries, the Board may determine that any unvested Options held by the participant immediately lapse and that any unvested Shares held by the participant be forfeited; ● in certain circumstances Options can vest early upon a change of control event as defined under the Plan rules; ● the total number of Options and Shares which may be offered by the Company under these Rules shall not at any time exceed 5% of the Company's total issued Shares when aggregated with the number of Options and Shares issued or that may be issued as a result of offers made at any time during the previous three year period under an employee incentive scheme; ● the Board has discretion to impose restrictions (except to the extent prohibited by law or the ASX Listing Rules) on Shares issued or transferred to a participant on vesting of an Option or a Performance Right, and the Company may implement appropriate procedures to restrict a participant from so dealing in the Shares; and ● the Board is granted a certain level of discretion under the Employee Incentive Programme (EIP), including the power to amend the rules under which the EIP is governed and to waive vesting conditions, forfeiture conditions or disposal restrictions, including but not limited to the execution of the EIP's terms upon termination of employment. The options will vest on the date determined by the Board and as specified in the Invitation Letter. 4,640,759 options were granted under the ESOP during FY 2024 (FY 2023: 3,649,298). In March 2024, the Consolidated Entity issued 252,562 fully paid ordinary shares upon the exercise of 2,152,655 unlisted options over fully paid ordinary shares with an exercise price of $0.09 (9 cents) per fully paid ordinary share and an expiry date of 1 July 2024. Settlement was made on a cashless net basis, determined on difference between the 30 day VWAP for the period immediately preceding the exercise date less the exercise price of $0.09 (9 cents) per fully paid ordinary share. Share-based compensation Issue of shares During FY 2024, 164,208 fully paid ordinary shares were issued to Matthew Boyall, the Chief Executive Officer upon the exercise on a cashless basis of 1,399,595 options granted as part of their compensation. Options The terms and conditions of each grant of options over ordinary shares affecting remuneration of KMP in this financial year or future reporting years are as follows: Number of Fair value options Vesting date and per option Name granted Grant Date exercisable date Expiry date Exercise price (Cents) at grant date (Cents) Matthew Boyall 1,102,607 16 July 2020 1 July 2023 1 July 2025 11.700 5.100 Matthew Boyall 1,428,843 23 July 2021 23 July 2024 23 July 2026 7.800 3.900 Matthew Boyall 1,714,612 30 August 2022 1 July 2025 1 July 2027 8.900 3.200 Matthew Boyall 2,129,386 8 September 2023 1 July 2026 1 July 2028 7.200 3.150 Options granted carry no dividend or voting rights. (E) Relationship between remuneration policy and company performance Company performance review The tables below set out summary information about the company’s earnings and movements in shareholder wealth and key management remuneration for the five years to 30 June 2024 38 Cue Energy Resources Limited Annual Report 2024
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