Red Bubble Annual Report 2022

21. Share-based payments continued Limited recourse loans for the purchase of shares The granting of limited recourse loans to purchase Redbubble shares is considered to be an in-substance option grant in accordance with AASB 2 Share Based Payment. An option pricing model is used to determine the fair value of the in-substance option and expensed in the financial statements over the service period. In the prior year a limited recourse loan was provided to the Chief Executive Officer (CEO). The CEO does not have a beneficial interest in the shares until the loan is repaid. The repayment of the loan principal plus accrued interest represents the exercise of the option, and returning the shares as settlement of the loan is the expiry of an unexercised option. Please see Note 22(b) for more information. Restricted Stock Units (RSUs) Restricted Stock Units are granted under the Restricted Share and Performance Rights Plan to certain employees including senior executives and consultants. Once granted, the rights have a predetermined time-based vesting schedule. All the restricted stock units are subject to service conditions. Share Appreciation Rights (SARs) Share appreciation rights have been granted to the Chief Executive Officer and the Executive team. (a) Movement The table below summarises the movement in the number of options, restricted stock units and share appreciation rights during the year: 2022 Number 2022 WAEP ($)(1) 2021 Number 2021 WAEP ($)(1) Options over ordinary shares Outstanding at 1 July 6,771,996 0.90 18,510,058 0.85 Granted during the year(2) 1,004,450 – 867,545 – Exercised during the year (2,161,917) 0.67 (10,405,267) 0.80 Forfeited during the year (1,126,450) 0.79 (2,188,371) 0.64 Expired during the year (682,571) 1.54 (11,969) 0.93 Outstanding at 30 June 3,805,508 0.70 6,771,996 0.90 Exercisable at 30 June 2,631,587 0.94 3,401,054 0.87 Restricted stock units Outstanding at 1 July 1,465,053 – 2,200,400 – Granted during the year 1,266,984 – 942,592 – Settled during the year (868,480) – (1,344,372) – Forfeited during the year (459,644) – (333,567) – Outstanding at 30 June 1,403,913 – 1,465,053 – Share appreciation rights (SARs)(3) Outstanding at 1 July 4,523,698 – 7,276,161 – Granted during the year 1,490,626 – 985,378 – Exercised during the year (127,662) – (2,215,514) – Forfeited during the year (178,246) – (1,522,327) – Expired during the year (50,000) – – – Outstanding at 30 June 5,658,416 – 4,523,698 – Exercisable at 30 June 1,805,452 – 1,983,114 – (1) WAEP stands for Weighted Average Exercise Price. (2) 1 ,004,450 options granted during the year have a zero exercise price (2021: 867,545). The expiry period for options and RSU grants made during the current and prior year is 6 years. (3) SARs do not have an exercise price, however they do have a base share price from which any share appreciation is measured. Notes to the Consolidated Financial Statements continued For the Year Ended 30 June 2022 (b) Modifications to the awards The table below details modifications to a number of options/restricted stock units (RSUs)/share appreciation rights (SARs) during the year. 2022 Number 2021 Number Accelerated vesting of unvested options/RSUs/SARs over ordinary shares upon cessation of employment 310,147 459,214 Total 310,147 459,214 (c) Additional disclosures Weighted average fair value of 2022 $ 2021 $ Share price at the date of exercise of options/settlement of restricted stock units during the year 3.49 4.23 Share options granted during the year 3.83 4.27 Share appreciation rights granted during the year 2.21 2.21 Restricted stock units granted during the year 3.54 4.34 Weighted average remaining contractual life of 2022 (years) 2021 (years) Share options outstanding at the end of the year 5.82 7.07 Inputs to pricing models for options and SARs granted during the year (weighted average) 2022 2021 Expected volatility (%)(1) 70.91 69.94 Risk-free interest rate (%) 1.30 0.67 Expected life (years) 4.47 4.72 Expected dividend yield (%) – – Fair market value of share price ($)(2) 3.95 4.32 (1) T he expected volatility reflects the assumption that the historical volatility over a period similar to the life of the options is indicative of future trends, which may not necessarily be the actual outcome. The range of exercise prices for options outstanding at the end of the year is $nil to $1.56 (2021: $nil to $1.62). (2) The fair market value of a share has been calculated using the closing price on grant date. 22. Related party transactions (a) Compensation of the key management personnel of the Group 2022 $ 2021 $ Short-term employee benefits 1,804,449 1,759,054 Post-employment benefits 107,440 105,186 Share-based employee benefits 1,455,526 761,591 Other long-term benefits 5,154 2,139 Total transactions with key management personnel 3,372,569 2,627,970 85 Redbubble – Annual Report 2022 84 Redbubble – Annual Report 2022

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