24 KEY MANAGEMENT PERSONNEL  DISCLOSURES  (continued) (b) Other transactions and balances with Key Management  Personnel 25 SHARE BASED PAYMENT PLANS (a) Long Term Incentive Executive Share and Loan Plans  (“LTI plans”) Peninsula Cinemas Pty. Ltd., which are non-competing cinemas owned by  an entity associated with Mr. R.G. Kirby, exhibit films supplied by the  Roadshow Distributors Pty. Ltd. group (“RD group”) on arm’s length terms  and conditions. The total amount paid to the RD group for the year ended  30 June 2014 was $358,685 (2013: $302,595). The entities in the RD group  are wholly-owned subsidiaries of the VRL group. The consolidated entity purchased wine from Yabby Lake International Pty.  Ltd., an entity in which family members of Mr. R.G. Kirby have an economic  interest. The total purchases were $305,999 for the year ended 30 June  2014 (2013: $289,764). The wine purchased was mainly for the Cinema  Exhibition division’s Gold Class and Europa cinemas and for Corporate  functions. These transactions were carried out under arm’s length terms  and conditions. The consolidated entity purchased swimwear from Garyson Nominees Pty.  Ltd., an entity associated with Mr. G.W. Burke. The total purchases were  $50,338 for the year ended 30 June 2014 (2013: $53,989). The swimwear  was purchased on an arm’s length basis as merchandise for resale by the  Theme Parks division. The consolidated entity recharged occupancy costs and other net  recharges for services provided and received, on an arm’s length basis, to a  number of entities associated (either individually or collectively) with  Messrs. R.G. Kirby, J.R. Kirby and G.W. Burke. The total net amount charged  for the various occupancy and other services in the year ended 30 June 2014  was $83,530 (2013: $77,441). The consolidated entity reimbursed Carolyna Chase Pty. Ltd., an entity  associated with Mr. J.R. Kirby, for accommodation and transport costs, on  arm’s length terms and conditions. The total amount reimbursed for the  year ended 30 June 2014 was $Nil (2013: $4,370). As at 30 June 2014, the total amount owing by the related parties detailed  above, and included in current assets of the VRL group, was $16,142 (2013:  $19,251), and the total amount owing by the VRL group to the related parties  detailed above, and included in current liabilities, was $1,662 (2013: $8,235). The Company has used the fair value measurement provisions of AASB 2:  Share-based Payment  for all options or equity instruments granted to  Directors and relevant senior executives after 7 November 2002 which have  not vested as at 1 January 2005. Under AASB 2:  Share-based Payment  these  LTI plan shares and loans are all treated as ‘in substance options’ even  where the equity instrument itself is not a share option. The fair value of such ‘in substance option’ grants is amortised and  disclosed as part of Director and senior manager compensation on a  straight-line basis over the vesting period. During the current and prior periods the consolidated entity had three  different LTI plans in which Group employees, including Key Management  Personnel (“KMP”), participated to varying extents. These included: At 30 June 2014 both the ESP and 2012 OP remain in operation. In addition the Group has a loan arrangement over a 1993 legacy equity- linked performance plan in which Mr. P.M. Harvie is the sole remaining  participant, where dividends are used to repay the interest accrued with  any surplus dividend payment used to repay the capital amount of the loan.  All grants to Mr. Harvie under this legacy plan were in his capacity as an  executive of the consolidated entity and were prior to him becoming part  of KMP of the Company. One of these loans, over 64,350 shares, was repaid  from dividends during the 2014 year (2013: Nil shares). All LTI plans have been approved by shareholders at the time of their  introduction. Grants were made from time to time as appropriate, and all  proposed grants to Directors of the Company were put to shareholders for  approval. The quantum of the LTI plan grants are reflective of the seniority  of the position of the relevant executive and their ability to contribute to the  overall performance of the consolidated entity. The ESP plan for senior executives of the consolidated entity has no specific  performance conditions for the removal of restrictions over the relevant  shares other than successful achievement of annual performance criteria.  Any value accruing to KMP and senior executives from the LTI plan is  derived from improvement in the Company’s share price and dividends and  distributions by the Company. The LTI plan also encourages a sense of  ownership with those senior executives to whom the LTI plan shares are  granted, assisting in aligning their long term interests with those of  shareholders. The Company considers that the five year period over which the ESP  ‘in-substance options’ are ‘earned’ and the long term horizon of the loans  from the consolidated entity for the ESP for the duration of the employees’  employment are appropriate given the shorter term annual performance  hurdles to which each senior executive is subject. Similarly, the three, four  and five year vesting periods of the ordinary options granted to the entity’s  CEO in both the 2008 OP and 2012 OP, together with the performance  conditions attaching to each tranche of options, are designed to encourage  performance and to closely align the CEO’s interests with those of  shareholders. There are no provisions within any of the LTI plans for the automatic  removal of restrictions on the relevant shares in the event of a change of  control of the Company. The ESP has limited recourse loans secured over the relevant shares,  together with a buy-back option in the event of default. The Company has  full control over all loans and the repayment thereof and full control over all  shares including through holding locks. From 1 July 2011 the Company has  implemented a policy that specifically prohibits the hedging of incentive  remuneration granted to Executive KMP, whether restricted or  unrestricted. For the CEO’s 2008 and 2012 ordinary options, the terms of  the offers specifically prohibit the hedging of unvested options by Mr. Burke. From 1 January 2005, ‘in substance options’ granted as part of employee and  executive compensation have been valued using the Black-Scholes or  binomial option-pricing model or the Monte Carlo simulation technique,  which takes account of factors including the option exercise price, the  current level and volatility of the underlying share price, the risk-free interest  rate, expected dividends on the underlying share, current market price of the  underlying share and the expected life of the ‘in substance option’. The Company’s ESP was approved by shareholders on 19 November 1996 and  allows for the issue of up to 5% of the Company’s issued A Class Preference  shares (now ordinary shares) to relevant employees of the consolidated entity  and significant associated entities. Directors of the Company are not eligible  to participate in the ESP. The conversion of the Company’s preference shares  on 16 November 2010 into ordinary shares also applied to ESP preference  shares and the ESP is now ordinary share based. All grants to Mr P.M. Harvie  were in his capacity as an executive of the consolidated entity and were prior  to him becoming a Director of the Company. Offers are at the discretion of the Directors and shares are issued at the  5-day weighted average price on the market prior to allotment, rounded up  to the next whole cent. The shares are held directly by the employee who  pays for the allotment by obtaining a loan from the consolidated entity  which holds the ESP shares as security. The ESP was amended in 2012. Shares issued prior to 2012 are earned and  become exercisable at the rate of 20% per year over five years from date of  issue. The loan bears interest at ten cents per share per annum, and ten  cents of dividends per share each year is used to repay the interest accrued  and 50% of the remaining dividend per share is used to repay the capital  amount of the loan. For shares issued in 2012 and thereafter, one third vest  at the end of years 3, 4 and 5 from the date of issue, the loan bears interest  at twenty cents per share per annum, and the first twenty cents of dividends  per share per year is used to repay the interest charged, and 50% of the  remaining dividend per share is used to repay the capital amount of the  loan. For shares issued in 2012 or thereafter, where the loan balance owing  falls below $2.00 per share, the interest rate becomes 10% of the balance  owing on the loan. If the employee resigns or is dismissed, the restricted shares are forfeited  and the loan on the remaining unrestricted shares must be repaid within  six months or such other time as approved by Directors. In circumstances  where the market value of the remaining ESP shares at the end of the  six month period is less than the amount owing on the loan, then the  Company will buy-back the shares and cancel them in repayment of the  loan without further recourse to the employee. This is the basis on which  they have been described as ‘in substance options’. 61 ANNUAL REPORT 2014 1.  The Company’s Executive Share Plan and Loan Facility (“ESP”)  introduced in 1996; 2.  The 2008 Option Plan over ordinary shares to the Company’s CEO  (“2008 OP”); and 3.  The 2012 Option Plan over ordinary shares to the Company’s CEO  (“2012 OP”). (b) Share based Long Term Incentive grants (i) Executive Share Plan and Loan Facility (“ESP”) CLOSE FILE X