Bidcorp’s current management share incentive plans comprise the Bidvest Incentive Scheme (BIS), Bid Corporation Limited Share Appreciation Rights (SARs) Plan, and Bidcorp Conditional Share Plan (CSP).

The Bidvest Incentive Scheme (BIS)

BIS participants were treated fairly on the unbundling of Bidcorp from The Bidvest Group Limited, as participants of the BIS who were granted options in terms of the BIS and who had not exercised their options at the unbundling date, exchanged each one of their Bidvest Group Limited options for one right over one Bid Corporation Limited share and one The Bidvest Group Limited share (replacement right(s)).

The original option price was not adjusted, but on exercise of the replacement right, the original option price is deducted from the combined value of Bidcorp shares and Bidvest Group shares. The vesting date and lapse dates of the replacement rights are the same as that of the original options. Replacement right(s) vest in tranches after three years (50%), four years (25%) and five years (25%) respectively. Replacement right(s) not exercised within a 10-year period following the award date, lapse. The scheme has been classified as an equity- settled scheme, and therefore an equity-settled share-based payment reserve has been recognised.

Replacement right(s) holders are only entitled to exercise their replacement right(s) if they are in the employment of the Bidcorp group in accordance with the terms referred to hereafter, unless otherwise recommended by the remuneration committee.

The number and weighted average exercise prices of replacement right(s) granted to staff are:

The replacement right(s) outstanding at June 30 2017 have an exercise price in the range of R135,00 to R301,54 (2016: R135,00 to R301,54) and a weighted average contractual life of 3,4 to 8,5 years (2016: 4,4 to 9,5 years). The fair value of services received in return for shares allotted is measured based on a binomial model. The contractual life of the awards is used as an input into this model.

Bid Corporation Limited Share Appreciation Rights (SARs) Plan

SARs participants were granted share awards (awards) that vest in tranches after three years (50%), four years (25%) and five years (25%) respectively. Awards not exercised within a seven-year period following the award date, lapse. The scheme has been classified as an equity-settled scheme, and therefore an equity-settled share-based payment reserve has been recognised. Award holders are only entitled to exercise their awards if they are in the employment of the Bidcorp group in accordance with the terms referred to hereafter, unless otherwise recommended by the remuneration committee.

The number and weighted average exercise prices of awards granted to staff are:

The awards outstanding at June 30 2017 have an exercise price in the range of R238,04 to R263,91 (2016: R238,04) and a weighted average contractual life of 6,0 to 6,9 years (2016: seven years). The fair value of services received in return for shares allotted is measured based on a binomial model. The contractual life of the awards is used as an input into this model.

The fair value of the shares allotted on the below mentioned dates and the assumptions used are:

The volatility is based on the recent historic volatility of Bid Corporation Limited and The Bidvest Group Limited share.

Conditional share plan (CSP)

The CSP awards executives of Bidcorp a conditional right to receive Bidcorp shares free of any cost. Due to the unbundling, the 2015 CSP awards for executive directors were restructured into replacement conditional rights and each conditional right in terms of the 2015 awards was exchanged for a right over a Bid Corporation Limited share. CSP replacement rights are subject to revised performance conditions for the period starting July 1 2016 and ending June 30 2019.

Bidcorp CSP

Executive directors were awarded conditional share awards in terms of the 2016 Bidcorp CSP, approved by shareholders at the general meeting in April 2016.

These share awards do not carry voting rights attributable to ordinary shareholders. The fair value of services received in return for the conditional share awards has been determined by multiplying the number of conditional share awards expected to vest by the share price at the date of the award less discounted by anticipated future distribution flows. A total number of 263 695 of the 348 000 CSP and CSP replacement right awards are expected to vest, taking into account the performance of the group to date and forecasts to the end of the performance period against the targets set at the time of the award.

The number of conditional share awards in terms of the conditional share plan scheme are:

There were no conditional share awards or CSP replacement rights forfeited (2016: 82 746) as a result of performance conditions not being met. The average discounted share price used in the calculation of the share-based payment charge on the conditional share awards allotted during the year is R220,91 per share. These awards will vest in the next two years.