Cue Energy Resources Limited Shareholder information 30 June 2023 33 Note 26. Share-based payments During the year ended 30 June 2023, $0.10 million in share-based payments expenses was recognised (FY 2022: $0.19 million). On 30 August 2022, the Company issued 3,649,298 unlisted options to eligible employee under the share option scheme. The options are exercisable at $0.089 (8.9 cents) per option and will vest on 1 July 2025 and expire on 1 July 2027. The options were valued using Black-Scholes option pricing model. $0.03 million of share-based payment expense was recognised in relation to the aforementioned options for the year ended 30 June 2023. Set out below are summaries of options granted under the plan: 30 June 2023 Grant date Expiry date Exercise price Balance at the start of the year Granted Exercised Expired/ forfeited/oth er Balance at the end of the year 29/07/2017 01/07/2023 $0.070 3,513,430 - - (39,777) 3,473,653 04/10/2019 01/07/2024 $0.090 3,569,765 - - (46,750) 3,523,015 16/07/2020 01/07/2025 $0.117 3,241,067 - - (36,830) 3,204,237 23/07/2021 22/07/2026 $0.078 4,047,966 - - (42,167) 4,005,799 30/08/2022 01/07/2027 $0.089 - 3,649,298 - (50,600) 3,598,698 14,372,228 3,649,298 - (216,124) 17,805,402 Weighted average exercise price $0.088 $0.089 $0.000 $0.088 $0.088 The weighted average remaining contractual life of outstanding options at 30 June 2023 is 2.56 years (30 June 2022: 2.57 years). 30 June 2022 Grant date Expiry date Exercise price Balance at the start of the year Granted Exercised Expired/ forfeited/oth er Balance at the end of the year 29/07/2017 01/07/2023 $0.070 3,784,025 - - (270,595) 3,513,430 04/10/2019 01/07/2024 $0.090 3,853,298 - - (283,533) 3,569,765 16/07/2020 01/07/2025 $0.117 3,743,260 - - (502,193) 3,241,067 23/07/2021 22/07/2026 $0.078 - 4,599,003 - (551,037) 4,047,966 11,380,583 4,599,003 - (1,607,358) 14,372,228 Weighted average exercise price $0.092 $0.078 $0.000 $0.091 $0.088 For the options granted during the current financial year, the valuation model inputs used to determine the fair value at the grant date, are as follows: Grant date Expiry date Share price at grant date Exercise price Expected volatility Dividend yield Risk-free interest rate Fair value at grant date 30/08/2022 01/07/2027 $0.070 $0.089 58.00% - 3.39% $0.032 Accounting policy for share-based payments Equity-settled share-based compensation benefits are provided to employees. Equity-settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for the rendering of services. Cash-settled transactions are awards of cash for the exchange of services, where the amount of cash is determined by reference to the share price. Notes to the financial statements Note 22. Business combinations (continued) 31 On the acquisition of a business, the Consolidated Entity assesses the financial assets acquired and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic conditions, the Consolidated Entity's operating or accounting policies and other pertinent conditions in existence at the acquisition-date. Where the business combination is achieved in stages, the Consolidated Entity remeasures its previously held equity interest in the acquiree at the acquisition-date fair value and the difference between the fair value and the previous carrying amount is recognised in profit or loss. Contingent and deferred consideration to be transferred by the acquirer is recognised at the acquisition-date fair value. Subsequent changes in the fair value of the contingent and deferred consideration classified as an asset or liability is recognised in profit or loss. Contingent and deferred consideration classified as equity is not remeasured and its subsequent settlement is accounted for within equity. The difference between the acquisition-date fair value of assets acquired, liabilities assumed and any non-controlling interest in the acquiree and the fair value of the consideration transferred and the fair value of any pre-existing investment in the acquiree is recognised as goodwill. If the consideration transferred and the pre-existing fair value is less than the fair value of the identifiable net assets acquired, being a bargain purchase to the acquirer, the difference is recognised as a gain directly in profit or loss by the acquirer on the acquisition-date, but only after a reassessment of the identification and measurement of the net assets acquired, the non-controlling interest in the acquiree, if any, the consideration transferred and the acquirer's previously held equity interest in the acquirer. Business combinations are initially accounted for on a provisional basis. The acquirer retrospectively adjusts the provisional amounts recognised and also recognises additional assets or liabilities during the measurement period, based on new information obtained about the facts and circumstances that existed at the acquisition-date. The measurement period ends on either the earlier of (i) 12 months from the date of the acquisition or (ii) when the acquirer receives all the information possible to determine fair value. Note 23. Events after the reporting period On 1 July 2023, 3,473,653 options over fully paid ordinary shares in the Company with an exercise price of $0.07 (7 cents) expired. On 10 July 2023, $3.07 million was received from Maari oil sales in June 2023, reducing the trade and other receivables in note 10. On 23 August 2023, the Consolidated Entity announced the results from the drilling and testing at the BA-01 well in the Mahato PSC. The conclusion reached was that no hydrocarbons had been identified. The Mahato PSC partners will continue to identify and assess further exploration opportunities in Mahato's PB Field. 79 Cue Energy Resources Limited Annual Report 2023
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