The board of directors of Valmet resolved on continuing the long term incentive plan for key employees
The Board of Directors of Valmet has decided to continue the share based incentive program for Valmet’s key employees approved in December 2014. The aim of the program is to combine the objectives of the shareholders and the key employees in order to increase the value of the company, to commit the key employees to Valmet, and to offer them a competitive reward plan based on holding the company’s shares. The program approved in 2014 includes three discretionary periods, which are the calendar years 2015, 2016 and 2017. The Board of Directors of Valmet shall decide on the performance criteria and targets in the beginning of each discretionary period. The potential reward of the program from the discretionary period 2016 is based on EBITA % improvement and orders received growth % of the stable business, that is, the Services and Automation business lines. The potential reward of the plan from the discretionary period 2016 will be paid partly as Valmet shares and partly in cash in 2017. The proportion to be paid in cash is intended to cover taxes and tax-related costs arising from the reward to the key employee. As a rule, no reward is paid, if the key employee’s employment or service ends before the reward payment.
As part of the share based incentive program members of the Valmet Executive Team shall have a possibility to receive a matching share reward for the discretionary period 2016 provided that he or she owns or acquires Valmet shares up to a number determined by the Board of Directors by December 31, 2016. Reward receipt is tied to the continued employment or service of the Valmet Executive Team member upon reward payment.
The reward of the plan may not exceed 120 percent of the key employee’s annual total base salary. The shares paid as reward may not be transferred during the restriction period, which will end two years from the end of the discretionary period. Should a key employee’s employment or service end during the restriction period, as a rule, he or she must gratuitously return the shares given as reward to Valmet.
The plan is directed to approximately 80 people. The rewards to be paid on the basis of the plan are in total an approximate maximum of 850,000 shares in Valmet.