Creative 2011 Annual Report Download - page 51

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51
CREATIVE TECHNOLOGY LTD AND ITS SUBSIDIARIES
Number of Fair value Expected Dividend Risk-free Share price
Grant Vesting shares per share volatility yield interest rate at grant date
date date (‘000) US$ % % % US$
31.3.2010 31.3.2011 514.5 3.49 56.07 1.99 0.45 3.57
31.3.2010 31.3.2012 514.5 3.40 56.07 1.99 0.62 3.57
31.3.2010 31.3.2013 514.5 3.33 56.07 1.99 0.72 3.57
31.3.2010 31.3.2014 514.5 3.29 56.07 1.99 1.08 3.57
The movements of the number of performance shares during the nancial year are as follows:
Outstanding Outstanding
at Vested and at
Grant 1 July 2010 Granted released Cancelled 30 June 2011
date (‘000) (‘000) (‘000) (‘000) (‘000)
31 March 2010 2,088 – (169) (276) 1,643
(c) Performance shares
The Creative Performance Share Plan (the “Plan”) was approved by shareholders at an Extraordinary General Meeting on
29 October 2009 under which awards (the “Award”) of fully-paid shares, their equivalent cash value or combinations thereof,
will be issued free of charge, to eligible employees and non-executive directors of the Company and its subsidiaries, provided
that certain prescribed performance targets are met and/or upon expiry of the prescribed vesting periods.
In the nancial year ended 30 June 2010, 2,793,600 performance shares were granted on 31 March 2010 subject to the terms
and conditions of the Plan. Of the total performance shares granted, 716,950 shares were vested immediately on the date
of grant.
There were no awards granted under the Plan during the nancial year ended 30 June 2011.
The fair value of the performance shares is determined at the grant date using the Monte Carlo simulation model which
involves projecting future outcomes based on statistical distributions of key random variables including share price and
volatility of returns.
The fair values and assumption inputs used in the model are as follows:
Of the total 169,000 shares released during the nancial year, 19,000 shares were paid in cash in lieu of delivery of shares
as permitted under the Plan. The release of the balance 150,000 shares were satised using treasury shares.
25. OTHER RESERVES
Group Company
2011 2010 2011 2010
US$’000 US$’000 US$’000 US$’000
(a) Composition:
Capital reserves 19,932 19,932 6,951 6,951
Share-based compensation reserves (Note (b)) 44,697 42,353 30,214 27,870
64,629 62,285 37,165 34,821
Other reserves are non-distributable.
Capital reserves arose from changes of interests in the group companies in prior nancial years. Share-based compensation
reserves comprised mainly of compensation expense for share options, tax benets relating to exercise of non qualied share
options by US employees, performance share plans and Chairman’s gift of shares to employees.