The Board of Directors of Finnair has, as part of the existing long-term incentive scheme structure, approved a new individual performance share plan period covering the years 2021–2023. Within the plan, the participants have the opportunity to earn Finnair shares as a long-term incentive reward, if the performance targets set by the Board of Directors for the plan are achieved. The purpose of the arrangement is to motivate the management to work for increasing the shareholder value in the long-term and to commit the management to the company.
The annually commencing performance share plans include a three-year performance period. The potential share rewards will be delivered to the participants in one tranche after the performance period and they are at the participants’ free disposal after delivery. The potential share rewards will be delivered to the participants in the spring 2024. The performance criteria applied to the plan 2021–2023 are earnings per share, unit cost CASK (using constant currencies and fuel price) and CO2 emissions (fuel efficiency).
If the targets set for the plan for years 2021–2023 are fully achieved, the maximum number of shares to be delivered based on this plan is approximately 8,100,000 shares. This number of shares represents a gross earning, from which the payroll tax is deducted, and the remaining net value is delivered to the participants in shares.
The members of Finnair’s Executive Board are expected to retain at least fifty per cent of the net shares received based on the arrangement until their share ownership in Finnair corresponds to at least their annual gross base salary.
The maximum combined value of all variable compensation paid to an individual participant in any given year may not exceed hundred and twenty per cent of the participant’s annual gross base salary.
The number of employees eligible to participate in the plan 2021–2023 is approximately 70 persons.
The Board of Directors anticipates that no new shares will be issued in connection with the share-based incentive plans and that therefore the arrangement will have no dilutive effect on the registered number of the company’s shares.