FGV Audited Financial Statements 2019

205 01 S E C T I O N NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2019 AUDITED FINANCIAL STATEMENTS 2019 54 PROVISION FOR LITIGATION LOSS Group 2019 RM’000 2018 RM’000 At 1 January 35,541 32,841 Provision during the financial year - 2,700 Payment made during the financial year (32,674) - Currency translation differences (2,867) - At 31 December - 35,541 Provision for litigation loss related to amount provided for legal suit by a vessel owner, against FGV Trading Sdn. Bhd. (“FGVT”), a wholly-owned subsidiary of the Company. The claims were for the loss and damages caused by an alleged breach of the terms of a Letter of Indemnity (“LOI”) issued by FGVT in relation to the release of goods by the vessel owner for CPO sold by FGVT to end customer, which had defaulted payments to the financial institution. The litigation amount had been fully settled by FGVT during the current financial year. 55 LONG TERM INCENTIVE PLAN The Company had established a long term incentive plan (“LTIP”) in the form of employee share grant scheme which is governed by the By-Laws which was approved on 3 February 2016. Pursuant to the LTIP, the Company shall award the grant of up to 10% of the issued and paid-up ordinary share capital of the Company (excluding treasury shares, if any) at any point of time during the duration of the LTIP, to the employees of the Company and its subsidiaries (“Group”) and Executive Director of the Company who fulfil the eligibility criteria as eligible employees and is administered by the LTIP Committee. The LTIP comprises a restricted share (“RS”) grant and a performance share (“PS”) grant which shall be in force for a period of 10 years commencing from 3 February 2016, being the effective date of the implementation of the LTIP. The details of the Grant are as follows: (a) RS Grant The RS Grant is restricted share grant for the eligible employees selected on a basis designated by the LTIP Committee. The RS Grant will be awarded on a need basis to the selected employees to be vested over a period of up to 3 years and after fulfilment of individual performance targets and certain performance conditions as determined by the LTIP Committee from time to time at its absolute discretion in accordance with the terms and conditions of the LTIP.