HAW PAR CORPORATION LIMITED
94
NOTES TO THE FINANCIAL STATEMENTS
(CONTINUED)
For the financial year ended 31 December 2014
25. EMPLOYEE BENEFITS
The Group
2014
$’000
2013
$’000
(a)
Staff costs (including Executive Directors):
- salaries, bonuses and other costs
21,469
19,743
- employer’s contribution to Central Provident Fund
and other defined contribution plans
1,636
1,564
- expensing of share options
305
241
23,410
21,548
Key management’s remuneration is disclosed in Note (22(b)).
(b)
The Company operates the Haw Par Corporation Group 2002 Share Option Scheme (“2002 Scheme”). The
2002 Scheme was approved by members of the Company on 22 May 2002 and further extended to 2017
on 20 April 2011.
The 2002 Scheme grants non-transferable options to selected employees and includes the participation by the
non-executive directors. The maximum life-span of exercising the options is 10 years (exercise period). The
options are exercisable beginning on the first anniversary from the date when the options are granted or the
second anniversary if the options are granted at a discount to the market price under the 2002 Scheme. The
options may be exercised in full or in part in respect of 1,000 shares or any multiple thereof, on the payment
of the exercise price. The Group has no legal or constructive obligation to repurchase or settle the options in
cash. The exercise price is equivalent to the average of the last dealt price for the share for five market days
immediately before the offer date (“market price”) at the time of grant and can be set at discounts of up to
20% to the market price under the 2002 Scheme.
During the financial year, options for 526,000 (2013: 438,000) shares were granted to qualifying employees
on 3 March 2014 (“2014 Options”) (2013: 4 March 2013 (“2013 Options”)). The fair value of the options
granted using the Trinomial valuation model is approximately $323,000 (2013: $264,000). The significant
inputs into the model are exercise price of $8.55 (2013: $7.27) at the grant date, standard deviation of
expected share price returns of 13% (2013: 14%), 5-year option life and annual risk-free interest rate of
0.3% (2013: 0.2%) per annum. The volatility measured at the standard deviation of expected share price
returns is based on statistical analysis of daily share prices over a historical period that matches the period
to expiry of the options. The 2014 Options are exercisable from 3 March 2015 and expire on 1 March 2019
(2013 Options exercisable from 4 March 2014 and expire on 3 March 2018).
(c)
Information with respect to share options granted under the 2002 Scheme is as follows:
Number of shares
2014
2013
Under 2002 Scheme:
Outstanding at beginning of the financial year
789,000
986,000
Granted
526,000
438,000
Cancelled/ Expired/ Not accepted
(14,000)
(26,000)
Exercised
(298,000)
(609,000)
Outstanding at end of the financial year
1,003,000
789,000
Exercisable at end of the financial year
491,000
365,000
