Changes for the Business Year 2019

LTI-Plan design changes as of 1 January 2019

Based on the input seeked from numerous shareholders and proxy advisors after the approval of the 2017 Compensation report, the Board of Directors amended the LTI-Plan effective for the performance year 2019.

The LTI-Plan 2019 rules can be summarized as follows:

  • The entirety of the award will remain to be granted as performance shares. The vesting of the performance shares is conditional upon the fulfillment of future performance conditions.
  • The performance conditions include for 50% Earnings per Share (EPS) as internal measure and for 50% relative Total Shareholder Return (rTSR) as external measure. Therefore, the performance criteria are well balanced in terms of both internal and external views.
  • The EPS value targets are aligned with the ambitious Strategy 2020 goals of GF.
  • The rTSR targets are linked to the SMI-Mid and focuses on performance at and above median; hence there will be no payout below median performance.
  • The vesting period is three years, followed by a further blocking period of two years on the vested shares. The plan is truly long-term performance focused.

Summary LTI-Plan 2019: KPI(EPS)

 

 

 

 

KPI (EPS)

 

Ø (EPS value years x+1, x+2, x+3) divided by Ø (EPS value years x, x-1, x-2) * 1.2

 

100% payout

 

20% EPS growth over 3 years

 

150% payout

 

30% EPS growth over 3 years

 

200% payout

 

38% EPS growth over 3 years

 

50% payout

 

0% EPS growth over 3 years

 

0% payout

 

EPS decline over 3 years

 

EPS = Earnings per share

Ø = Average

PS(EPS) payout curve for the LTI-Plan 2019

Summary LTI-Plan 2019: KPI(rTSR)

 

 

 

KPI (rTSR)

 

Average annual ranking within the benchmark group over prospective 3 years

Benchmark group

 

SMI – Mid

100% payout

 

Ranking at the median

200% payout

 

Ranking at the top

0% payout

 

No pay-out if ranking below median

PS(rTSR) payout curve for the LTI-Plan 2019