TELECHOICE INTERNATIONAL LIMITED
ANNUAL REPORT 2014
33
CORPORATE
GOVERNANCE
B.
Variable Cash Component:
The Variable Cash Component, including the Performance Bonus and the Discretionary Bonus, is a remuneration
component linked to the achievement of annual performance targets for each key management personnel as
agreed with the Board at the beginning of each financial year. Performance objectives aligned to the overall
business metrics and strategic goals of the Company are cascaded down throughout the organisation through
the use of Performance Scorecards, thereby creating greater alignment between the performance of the
Company, business units and the individual employees. These performance objectives could be in the form of
both quantitative and qualitative measures which are aligned to the Company’s business strategy. In determining
the final payout for each key management personnel, the RC considers the overall performance of the Company,
funding affordability and individual performance.
C.
Share-Based Component:
The aggregate number of new shares to be issued, when aggregated with existing shares (including treasury
shares, if any, and cash equivalents) delivered and/or to be delivered pursuant to the TeleChoice Restricted Share
Plan (the “
TeleChoice RSP
”) and the TeleChoice Performance Share Plan (the “
TeleChoice PSP
”) (collectively
referred to as the “
Share Plans
”) then in force, shall not exceed fifteen per cent (15%) of the total number of
issued shares (excluding treasury shares, if any) from time to time.
Please refer to the section on Equity Compensation Benefits in the Directors’ Report on pages 48 to 52 of this
Annual Report for the details of the Share Plans as well as awards granted under the Share Plans.
TeleChoice RSP
Under the TeleChoice RSP, conditional awards vest over a two-year period, once the RC is, at its sole discretion,
satisfied that the performance and extended service conditions are attained. The total number of shares to be
awarded depends on the level of attainment of the performance targets. No shares will be delivered if the threshold
performance targets are not achieved, while up to 1.3 times the number of shares that are the subject of the
award will be delivered if the stretched performance targets are met or exceeded. The performance measures
used in the TeleChoice RSP grants are Net Profit before Tax and Return on Capital Employed. The Company
has attained an achievement factor which is reflective of partially meeting the pre-determined target performance
levels based on the performance period from FY13 to FY14.
TeleChoice PSP
Under the TeleChoice PSP, conditional awards of shares are granted. Awards represent the right of a participant
to receive fully paid shares upon the participant achieving certain pre-determined performance targets which are
set based on corporate objectives aimed at sustaining longer-term growth. After the awards vest, the shares
comprised in the awards are issued at the end of the performance and/or service period once the RC is, at its sole
discretion, satisfied that the prescribed performance targets have been achieved. The actual number of shares
given will depend on the level of achievement of the prescribed performance targets over the performance period,
currently prescribed to be a three-year period. No shares will be delivered if the threshold performance targets
are not achieved, while up to 1.5 times the number of shares that are the subject of the award will be delivered
if the stretched performance targets are met or exceeded. The performance measures used in the TeleChoice
PSP grants are Total Shareholder Return (the “
TSR
”) against Cost of Equity Hurdles (i.e. measure of absolute
performance) and TSR against FTSE ST All-Share Index (i.e. measure of relative performance). The Company
has attained an achievement factor which is reflective of partially meeting the pre-determined target performance
levels based on the performance period from FY12 to FY14.
