REMUNERATION REPORT (AUDITED) (CONTINUED) 5. Executive remuneration arrangements (continued)  Variable remuneration - long term incentive (LTI) (continued) Executive Option Plan – LTI plan used by AACo up to 30 June 2009 Tax exempt share plan Hedging of equity rewards 6. Company performance and link to remuneration Company performance and its link to long term incentives DIRECTORS’ REPORT CONT. A change of control event occurs when any person, either alone or together with any “associate” (as defined in the Australian Corporations Act)  who does not hold a relevant interest in more than 50% of the issued shares of the Company acquires a relevant interest in more than 50% of the  issued shares, or the Board concludes that there has been a change in control of the Company then one of the following will occur in respect of all  unvested Performance Rights or Deferred Equity Awards. The Performance Rights or Deferred Equity Awards will vest on a pro-rata basis or at the  discretion of the Board in certain circumstances. The Company previously utilised an Executive Option Plan (EOP) for the granting of non-transferable options to executives and middle management  with more than twelve months’ service at the grant date. The existing options under the EOP have all vested.  There were no options granted in the three months to 31 March 2013 under the EOP and the Board does not intend to make further grants under  this scheme (twelve months to 31 December 2012: Nil). All Company and Group employees paid under $50,000 are eligible to be issued fully paid shares to the value of $1,000 p.a. under the Tax-exempt  Employee Share Plan (TESP). An employee must have been employed by the Group for 12 months to be eligible in the following year. There were no shares issued under the TESP in the three months to 31 March 2013 and the twelve months to 31 December 2012. The Company prohibits employees from entering into arrangements to protect the value of unvested LTI awards. The prohibition includes entering  into any scheme, arrangement or agreement (including options and derivatives) under which the employee may alter the economic benefit/risk  derived from security holdings in the Company under unvested entitlements (e.g. unvested equity-based incentive or award grant).  No Director or officer or employee may deal in Company shares at any time for short term gain, including buying and selling shares in a three  month period or using forward contracts, without approval of the Chairman, or in the case of the Chairman, a Director chosen by the Board for  that purpose. CEO LTI Performance Testing: The financial performance measure driving LTI payment outcomes is total shareholder return (TSR). TSR for the Company is defined as share price  growth plus dividends, assuming the dividends are reinvested into the Company’s ordinary shares. As a guide to TSR, the graph below demonstrates the shareholder wealth created since December 2002, as compared with the benchmark ASX  small ordinaries. Testing Date TSR % Vesting EPS % Vesting 2010 LTI 31 March 2013 0 0 2011 LTI 31 March 2014 N/A¹ N/A¹ 2012 LTI 31 March 2015 N/A¹ N/A¹ ¹ Vesting unlikely. Earnings per share (EPS) for each financial period are noted in the table below:  Per Share Statistics 3 months to 31 Mar 2013 12 months to  31 Dec 2012 12 months to  31 Dec 2011 12 months to  31 Dec 2010 12 months to 31 Dec 2009 Basic EPS (to the nearest 1/10 cent) (14.9) cents (2.7) cents 3.6 cents 0.3 cents (20.3) cents 30 Australian Agricultural Company Limited