Donaco International Limited / 2017 Annual Report Donaco International Limited / 2017 Annual Report 22 23 Directors’ Report Directors’ Report Service agreements Remuneration and other terms of employment for the Managing Director, Chief Financial Officer and the other key management personnel (other than Ham Techatut Sukjaroenkraisri) are formalised in contracts of employment. The service agreements specify the components of remuneration, benefits and notice periods. The specified executives are employed under contracts with no fixed term. The Company may terminate the contracts immediately if the executive is guilty of serious misconduct or wilful neglect of duties. Otherwise, the Company may terminate the contracts by giving three months’ notice or paying three months’ salary, or six months in the case of Mr Reichel. In the case of Mr J Lim (Lim K Y), termination for any reason other than just cause will result in a termination payment of 24 months’ base salary (subject to shareholder approval). Share-based compensation Issue of shares There were no shares issued as part of compensation during the year ended 30 June 2017. Options There were no options issued as part of compensation during the year ended 30 June 2017. Options granted carry no dividend or voting rights. Approval for the prior year issue of these options was obtained pursuant to ASX Listing Rule 10.14. The number of options over ordinary shares granted to and vested by directors and other key management personnel as part of compensation during the year ended 30 June 2017 are set out below: The proportion of the cash bonus paid/payable or forfeited is as follows: Cash bonus paid/payable Cash bonus forfeited Name 2017 2016 2017 2016 Executive Directors Lim K Y 100% 100% – – B P Reichel 100% 100% – – Other key management personnel Na C W n/a 100% – – Goh K B 100% 100% – – Chong K Y 100% 100% – – A Asavanund 100% – – – Criteria for performance-based remuneration The STI program is designed to align the targets of executives with the targets of the consolidated entity. STI payments are granted to executives based on specific annual targets and KPIs being achieved. The Board, advised by the Remuneration Committee, applied these criteria in determining the award of performance-based remuneration during the year. Performance-based bonuses were paid in October 2016. Cash bonuses of $676,439 were awarded to the Executive Directors and other key management personnel. A break up of the bonuses paid is in the tables above. For performance during FY17, the relevant criteria for the award of bonuses relate to revenue growth at each operating business, namely Star Vegas and Aristo International Hotel, as well as the achievement of budgeted EBITDA targets for the consolidated entity and a personal KPI for each executive. The proportion of the share options granted or forfeited is as follows: Share options granted Share options forfeited Name 2017 2016 2017 2016 Executive Directors Lim K Y – 100% – – B P Reichel – 100% – – Other key management personnel Na C W – 100% – – Goh K B – 100% – – The proportion of the share issued or forfeited is as follows: Shares issued Shares forfeited Name 2017 2016 2017 2016 Executive Directors Lim K Y – 100% – – B P Reichel – 100% – – Other key management personnel Na C W – 100% – – Goh K B – 100% – – Name Number of options granted during the year 2017 Number of options granted during the year 2016 Number of options vested during the year 2017 Number of options vested during the year 2016 Lim K Y – 2,002,967 872,059 326,116 B P Reichel – 1,001,484 496,744 229,796 Goh K B – 412,376 552,020 442,099 Additional disclosures relating to key management personnel Shareholding The number of shares in the Company held during the financial year by each director and other members of key management personnel of the consolidated entity, including their personally related parties, is set out below: Name Balance at the start of the year Received as part of remuneration Additions Disposals/ other Balance at the end of the year Ordinary shares S J McGregor 411,735 – – – 411,735 Lim K Y 264,659,325 – 2,900,000 – 267,559,325 B P Reichel 400,094 – – – 400,094 Lim K H 144,811,200 – – – 144,811,200 R A Hines 145,321 – – – 145,321 H T Sukjaroenkraisri 147,199,529 – 1,000,000 – 148,199,529 Goh K B 768,464 – – (68,464) 700,000 558,395,668 – 3,900,000 (68,464) 562,227,204