THE EMPLOYEE SHARE TRUST - DETAIL

The Employee Share Trust is similar to the plan prepared for the Department of Employment and Workplace Relations, referred to as the Loan Share Plan.

The concept involves the establishment of a special purpose Employee Share Trust (EST). The EST receives contributions and purchases shares in the Employer Company. Those shares are to be held for the benefit of Participating Employees. Employees are in turn issued with units in the trust, the deed and the particular terms of issue of the Share Units govern their entitlements to the share benefits.

Share Units may or may not be issued with vesting conditions, based on time and/or performance measures. These terms of issue should be consistent with the Employer’s particular remuneration strategies, underpinning the offer of participation in the EST.

Income by way of dividends may be declared and distributed from time to time. When benefits are to be realised, Share Units are redeemed, and encashed on an agreed valuation basis and cash benefits distributed.

The proposed purpose for the EST is as an effective delivery mechanism for Employer Shares to be provided to selected Participating Employees.