Yinson Annual Report 2021

275 ANNUAL REPORT 2021 NOTES TO THE FINANCIAL STATEMENTS (CONT’D) For the financial year ended 31 January 2021 29. Share-based compensation plans (continued) (b) Employees’ Long-Term Incentive Plan (continued) (c) Upon meeting the Award Conditions for each tranche, the Employees’ Share Scheme Committee (“ESS Committee”) and the Board of Directors of the Company will determine and approve the total number of Yinson Shares and total amount of performance bonuses to be awarded. The vesting of these Yinson Shares and performance bonuses is subject to the following vesting conditions: (i) The aggregate value of the vesting of such portion of the Yinson Shares or performance bonuses awarded in each financial year shall not exceed 20% of the Adjusted Group PATMI; and (ii) The balance portion of Yinson Shares and performance bonuses awarded but not vested due to the limit of 20% of Adjusted Group PATMI in each financial year, will continue to be vested in the subsequent financial year(s), without further testing of the Award Conditions as set out in (b) above, subject to the limit of 20% of Adjusted Group PATMI in each financial year, until those awarded Yinson Shares and performance bonuses are fully vested. No Yinson Shares shall be vested after the expiry or termination of the LTIP. (iii) An eligible employee must remain in employment and shall not have served a notice of resignation or received a notice of termination during the vesting period of 2 years from the date of grant for each tranche. (d) The Yinson Shares will vest equally over three instalments over a 2-year period with the first instalment vesting on the date of award. The date of award for each tranche is expected to be on 15 May of the applicable financial year. Depending on the level of achievement of the performance targets as determined by the ESS Committee or Nominating and Remuneration Committee of the Company, the total amount of Yinson Shares which will vest or total amount of performance bonuses which will be paid may be lower than the total number of shares or the total amount of performance bonuses offered respectively. (e) Pursuant to Clause 21.1 of the by-laws of the ESS (hereinafter “By-Laws”), the ESS Committee may, in its sole discretion, settle any unvested Yinson Shares by way of equity settlement or cash settlement prior to the termination of the ESS or expiry of the LTIP. Any unvested Yinson Shares shall automatically lapse and cease to be capable of vesting in the event the ESS expires or terminates in accordance with the terms of the By-Laws. (f) There were no Yinson Shares and performance bonuses awarded to the Group’s eligible employees and executive director under the LTIP in the financial year ended 31 January 2021. (g) The fair value of the Yinson Shares at grant date is determined using the Monte Carlo Simulation model, taking into account the terms and conditions upon which the shares were granted, share price at grant date, expected price volatility of the underlying shares, expected dividend yield, risk-free interest rate for the term of the LTIP and on the basis that the maximum number of Yinson Shares available for each tranche under the LTIP will be allotted and issued to eligible employees and executive director of the Group. The significant inputs in the model used were as follows: Grant date 3 August 2020 Share price at grant date (RM) 6.27 Risk free rate (%) 2.16 Expected volatility (%) 25 Expected dividend yield (%) 1.48 Fair value of Yinson Shares at date of award (RM): - Tranche 1 at 1-month VWAP of RM 6.50 5.76 - Tranche 2 at 1-month VWAP of RM 7.50 4.61 - Tranche 3 at 1-month VWAP of RM 8.50 3.66 - Tranche 4 at 1-month VWAP of RM 11.00 1.98