Notes to the Financial Statements (continued)  26. Contributed Equity (continued)  On 31 August 1999, in accordance with a Special Resolution passed at a general meeting of members of the parent  company, options to take up ordinary shares in the capital of the parent company at an exercise price of $3.212 per  option were granted to the trustees of separate trusts for the benefit of each of Gerald Harvey and family (3,000,000  options), Kay Lesley Page and family (3,000,000 options), Raymond John Skippen and family (3,000,000 options) and  Arthur Bayly Brew and family (1,500,000 options) (collectively the “August 1999 Options”). Each of the August 1999 Options:  The August 1999 Options have not been exercised. At a general meeting of shareholders of Rebel Sport Limited held on 26 September 2002, the shareholders approved  the granting of 3,400,000 options to Stephen Heath, the Managing Director of Rebel Sport Limited. The options entitle  the option holder to subscribe for 3,000,000 ordinary shares at $0.83 each (‘the first tranche’) and 400,000 ordinary  shares at $1.75 each (‘the second tranche’). The options cannot be exercised before 1 October 2005 and they expire  on 30 September 2007. The options were issued free of charge to the Managing Director. Using the Black-Scholes  option pricing formula, each of the first tranche options were valued at $0.86 per option, or $2,580,000 in total, and  each of the second tranche options were valued at $0.55 per option, or $220,000 in total.  Pursuant to Rebel Sport Limited’s Employee Option Incentive Scheme, on 4 April 2003, Rebel Sport Limited granted  unlisted options over 500,000 unissued ordinary shares to Karen Bozic, an employee of Rebel Sport Limited, at an  exercise price of $2.22 per option. The options were issued free of charge to this employee. Karen Bozic later  became an executive director of Rebel Sport Limited 22 May 2003. Using the Black-Scholes Option Pricing Formula,  the options issued to Karen Bozic were valued at $0.49 per option, or $247,000 in total.  At a general meeting of shareholders of Rebel Sport Limited held on 5 June 2001, the shareholders approved the  granting of 2,000,000 options to Messrs. Dresner and Seskin, the former Joint Managing directors of Rebel Sport  Limited. The options were exercisable in tranches, 800,000 at $0.70, 400,000 at $0.40, 400,000 at $0.20 and 400,000  at $0.01. The average exercise price at the date of issue was $0.402 per option and the options were issued free of  charge to the former directors. For the purposes of disclosure, the Black-Scholes option pricing formula was utilised,  so that:  On 24 April 2002, Ian Dresner and Hilton Seskin exercised 400,000 options each at $0.20 per option and 400,000  options each at $0.01 per option (“Rebel Dresner Seskin Options”). A total of 800,000 ordinary shares were issued to  Ian Dresner and Hilton Seskin on exercise of the options, resulting in a total cash inflow to Rebel Sport Limited of  $168,000. The market value of these shares at the date of issue to Ian Dresner and Hilton Seskin was $1,840,000.  As a result of the rights issue of shares which occurred in June 2002, the exercise price of the unexercised tranches  of the Rebel Dresner Seskin Options was adjusted to 800,000 options at $0.67 and 400,000 options at $0.38 in  accordance with the terms of the Rebel Dresner Seskin Options. On 16 September 2002, Ian Dresner exercised 800,000 options at $0.67 per option and 400,000 options at $0.38 per  option. A total of 1,200,000 ordinary shares were issued to Ian Dresner on exercise of the options resulting in a total  cash inflow to Rebel of $688,000. Ian Dresner has exercised all of the 2,000,000 options granted on 5 June 2001 and  hence has no outstanding options as at 30 June 2003. On 21 March 2003, Hilton Seskin exercised 400,000 options at $0.38 per option. A total of 400,000 ordinary shares  were issued to Hilton Seskin on exercise of the options resulting in a total cash inflow to Rebel of $152,000. The  balance of options granted to Hilton Seskin have not been exercised and will expire on 4 August 2006. Whilst Hilton  Seskin had resigned as director of Rebel at balance date, he is still an employee of Rebel and hence the options  remain exerciseable until the expiry date. 47  HARVEY NORMAN HOLDINGS LIMITED AND ITS CONTROLLED ENTITIES – ANNUAL REPORT 2003 each of the Rebel Dresner Seskin Options was valued at the date of issue 3 August 2001, at $1.2373 per option;  the Rebel Dresner Seskin Options issued to Ian Dresner had a value of $2,474,680; and  the Rebel Dresner Seskin Options issued to Hilton Seskin had a value of $2,474,680.  expires at midnight on 30 June 2004.  is not capable of being exercised prior to 1 July 2002; and  Rebel Sport Limited  (a) Options granted to directors of Rebel Sport Limited during the year ended 30 June 2003: (b) Options granted to directors of Rebel Sport Limited in prior financial years: