16. SHARE CAPITAL 2024 Shares 2023 Shares 2024 $’000 2023 $’000 Ordinary shares - issued 129,262,624 129,665,676 165,270 173,127 Movements in ordinary share capital Details Date Shares $’000 Balance 1 January 2023 128,965,676 167,740 Loan Funded Shares repaid and transferred to participant – 1,524 Shares issued on exercise of options 700,000 3,881 Share issue expenses - issue costs – (18) Balance 31 December 2023 129,665,676 173,127 Loan Funded Shares repaid and transferred to participant – 382 Shares issued on exercise of options 400,000 2,196 Share issue expenses - issue costs – (9) Shares bought back during the year (803,052) (10,426) Balance 31 December 2024 129,262,624 165,270 Ordinary shares At 31 December 2024, 127,012,624 ordinary shares (31 December 2023: 127,265,676) are quoted on the ASX, and 2,250,000 unquoted ordinary shares (31 December 2023: 2,400,000) were held as treasury stock in respect of the Loan Funded Share Plan described below. On 2 December 2024 Neuren commenced a share buy-back program, buying back 803,052 shares in the period to 31 December 2024. Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the company in proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the company does not have a limited amount of authorised capital. On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each share shall have one vote. Share based payments During year to 31 December 2024 $1.2 million (31 December 2023: $2.9 million) was recognised in share-based payments expense. Loan funded shares The Company has a Loan Funded Share Plan to support the achievement of the Company’s business strategy by linking executive reward to improvements in the financial performance of the Company and aligning the interests of executives with shareholders. Under the Loan Funded Share Plan, loan funded shares may be offered to employees or consultants (“Participants”). The Company issues new ordinary shares, which are placed in a trust to hold the shares on behalf of the Participant. The trustee issues a limited-recourse, interest-free loan to the participant, which is equal to the number of shares multiplied by the issue price. A limited-recourse loan means that the repayment amount will be the lesser of the outstanding loan and the market value of the shares that are subject to the loan. The trustee continues to hold the shares on behalf of the Participant until all vesting conditions have been satisfied and the Participant chooses to settle the loan, at which point ownership of the shares is transferred from the trust to the Participant. Any dividends paid by the Company while the shares are held by the trust are applied as repayment of the loan at the after-tax value of the dividend. On request by the Participant, the Company may dispose of, or buy back, vested shares and utilise the proceeds to settle the outstanding loan. The directors may apply vesting conditions to be satisfied before the shares can be transferred to the Participant. Before the loan can be given, the New Zealand Companies Act requires the Company to disclose to shareholders the provision of financial assistance to the Participant. The maximum loan term is 5 years. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED Neuren Pharmaceuticals Limited Annual Report 2024 40
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