IGO Interactive Annual Report 2019

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 30 JUNE 2019 Notes to the consolidated financial statements 30 June 2019 (continued) 25 Share-based payments (continued) Equity settled awards outstanding (continued) The share-based payments expense relating to performance rights included in profit or loss for the year totalled $1,883,700 (2018: $2,034,404). Fair value of performance rights granted The fair value of the share rights granted during the year ended 30 June 2019 are determined using a trinomial tree which has been adopted by the Boyle and Law (1994) node alignment algorithm to improve accuracy, with the following inputs: Fair value inputs CEO Senior management Other employees Grant date 23 November 2018 28 September 2018 28 September 2018 Vesting date 1 July 2021 1 July 2021 1 July 2021 Share price at grant date 3.89 4.66 4.66 Fair value estimate at grant date 2.17 2.81 2.81 Expected share price volatility (%) 47 48 48 Expected dividend yield (%) 1.29 1.07 1.07 Expected risk-free rate (%) 2.11 2.08 2.08 Vesting conditions of performance rights granted Vesting of the performance rights granted to executive directors and executives during the year is based on two equally weighted performance hurdles as follows: • Relative TSR; and • Absolute TSR. Relative TSR The relative TSR scorecard for the three year measurement period will be determined based on a percentile ranking of the Company's TSR results relative to the TSR of each of the companies in the peer group over the same three year measurement period. The peer group is to comprise the constituents of the S&P ASX 300 Metals and Mining Index. The vesting schedule of the performance rights subject to relative TSR testing is as follows: Relative TSR performance Level of vesting Less than 50th percentile Zero Between 50th and 75th percentile 50% plus pro-rata straight line percentage between 50% and 100% 75th percentile or better 100% The Company's TSR performance for share rights issued during the current financial year will be assessed against the following members of the S&P ASX 300 Metals and Mining Index: Independence Group NL 52 Notes to the consolidated financial statements 30 June 2019 (continued) 25 Share-based payments (continued) Equity settled awards outstanding (continued) The share-based payments expense relating to performance rights included in profit or loss for the year totalled $1,883,700 (2018: $2,034,404). Fair value of performance rights granted The fair value of the share rights granted during the year ended 30 June 2019 are determined using a trinomial tree which has been adopted by the Boyle and Law (1994) node alignment algorithm to improve accuracy, with the following inputs: Fair value inputs CEO Senior management Other employees Grant date 23 November 2018 28 September 2018 28 September 2018 Vesting date 1 July 2021 1 July 2021 1 July 2021 Share price at grant date 3.89 4.66 4.66 Fair value estimate at grant date 2. 7 2.81 .81 Expecte share price volatility (%) 47 48 48 Expected dividend yield (%) 1 2 1 07 1 07 Expected ri k-free r e (%) 1 08 08 Vesting conditions of performance rights granted Vesting of the performance rights granted to executive directors and executives during the year is based on two equally weighted performance hurdles as follows: • Relative TSR; and • Absolute TSR. Relative TSR The relative TSR scorecard for the three year measurement period will be determined based on a percentile ranking of the Company's TSR results relative to the TSR of each of the companies in the peer group over the same three year measurement period. The peer group is to comprise the constituents of the S&P ASX 300 Metals and Mining Index. The vesting sch dule of the performance rights subject to relative TSR testing is as follows: Relative TSR performance Level of vesting Less than 50th percentile Zero Between 50th and 75th percentile 50% plus pro-rata straight line percentage between 50% and 100% 75th percentile or better 100% The Company's TSR performance for share rights issued during the current financial year will be assessed against the following members of the S&P ASX 300 Metals and Mining Index: Independence Group NL 52 112 — IGO ANNUAL REPORT 2019