(Información remitida por la empresa firmante)
b. Participants are offered to be allocated Performance Shares, provided that the participant remains employed until January 1, 2026. Exemptions to this requirement may be prescribed in specific cases, including a participant’s death, disability, retirement or the divestiture through a sale, spin-off or otherwise of the participant’s employing company from the Electrolux Group. c. The Performance Shares shall be based on maximum performance values for each participant category. The maximum performance value for the participants in Group 1 will be 100 per cent of the participant’s annual base salary for 2023, for participants in Group 2, 90 per cent of the participant’s annual base salary for 2023, for participants in Group 3, 80 per cent of the participant’s annual base salary for 2023, for participants in Group 4, 60 per cent of the participant’s annual base salary for 2023, for participants in Group 5, 50 per cent of the participant’s annual base salary for 2023, for participants in Group 6, 40 per cent of the participant’s annual base salary for 2023, and for participants in Group 7, 20 per cent of the participant’s annual base salary for 2023. The total sum of the maximum values of the Performance Shares thus defined for all participants will not exceed SEK 583m excluding social costs.
d. Each maximum value shall thereafter be converted into a maximum number of Performance Shares1, based on the average closing price paid for Electrolux shares of series B on Nasdaq Stockholm during a period of ten trading days before the day the participants are invited to participate in the program, reduced by the present value of estimated dividend payments for the period until shares are allotted.
e. The calculation of the number of Performance Shares shall be connected to performance targets for the Group, for the performance period, established by the Board for (i) cumulative earnings per share2 and (ii) CO reduction3. The performance targets adopted by the Board will stipulate a minimum level and a maximum level, with the relative weight of the performance targets (i) and (ii) being 80 per cent and 20 per cent respectively. For the participants in Group 1 and 2 (Group Management), the granted Performance Shares based on (i) and (ii) will be multiplied by 0.75-1.25 depending on the outcome of a relative total shareholder return target4. The performance period is the financial years 2023-2025 with respect to each of the performance targets.
f. Performance outcome of the established performance targets will be determined by the Board after the expiry of the three-year performance period in 2026. If the maximum performance level is reached or exceeded, the allocation will amount to (and will not exceed) the maximum number of Performance Shares following from items c) and d). If performance is below the maximum level but exceeds the minimum level, a proportionate allocation of shares will be made. No allocation will be made if performance amounts to or is below the minimum level. Information on the performance targets and the outcome will be provided no later than in connection with the allocation of Performance Shares in accordance with item g).
g. If all conditions in the Share Program 2023 are met, allocation of Performance Shares will take place in the first half of 2026. Allocation will be free of charge except for tax liabilities.
h. Certain deviations in or adjustments of the terms and conditions for the Share Program 2023 may be made based on local rules and regulations as well as applicable market practice or market conditions or where appropriate due to group re-organizations, including cash settlement instead of delivery of shares under certain circumstances.
i. The Board of Directors, or a committee established by the Board for these purposes, shall be responsible for the preparation and management of the Share Program 2023, within the framework of the aforementioned terms and conditions.
j. If material changes would occur within the Electrolux Group or on the market that, according to the Board’s assessment, would lead to the conditions for allocation of Performance Shares no longer being reasonable, the Board will have the right to make also other adjustments of the Share Program 2023, including e.g. a right to resolve on a reduced allotment of shares.
Costs for the Share Program 2023
The total costs for the Share Program 2023 if the maximum number of Performance Shares are delivered, are estimated to a maximum of SEK 639m, which corresponds to approximately 3.1 per cent of total employment cost for 2022. The costs will be recognized over the years 2023-2025. The costs have been calculated as the sum of salary costs, including social costs, and administration costs for the program. Administration costs are estimated to be less than SEK 1m. If no allotment of shares is made, only administration costs will arise.
The costs have been calculated based on the value, at the start of the program, of the Performance Shares that may be allotted at maximum performance, with a reduction of the present value of estimated dividend payments during a three-year period. The estimate on maximum costs assumes maximum performance and that the number of participants that will leave the Group during the performance period is the same as the historical average since the introduction of share programs in 2004. In the calculation, a maximum share price of SEK 247 per share has been applied.
If repurchased own shares would be allocated under the program the number of outstanding shares is estimated to increase with not more than 3,965,000 shares of series B.5 Such maximum increase would have a dilutive effect on earnings per share of approximately 1.38 per cent. The total maximum increase in the number of outstanding shares of all outstanding share programs is estimated to not more than 7,874,000 shares of series B, corresponding to a dilutive effect on earnings per share of approximately 2.71 per cent. In this calculation, maximum allotment of shares has been assumed for Share Program 2023 and expected allotment has been assumed for the share programs for 2021 and 2022.
Hedging measures for the Share Program 2023
In order to implement Share Program 2023 in a cost-effective and flexible manner, the Board of Directors has considered various methods for transfer of shares to the participants. The Board of Directors has found that the most cost-effective alternative is transfer of own shares, and thus proposes that the Annual General Meeting resolves on transfer of own shares in accordance with item 17 b) below.
Should the majority required under item 17 b) below not be reached, Electrolux intends to enter into an equity swap agreement with a third party.
17 b) Resolution on transfers of own shares to the participants in Share Program 2023
In order to secure the delivery of Performance Shares in accordance with the terms and conditions of Share Program 2023, the Board of Directors proposes that the Annual General Meeting resolves that the company shall transfer a maximum of 3,965,000 shares of series B in the company on the following terms and conditions:
Majority requirements
The resolution of the Annual General Meeting to implement the program according to item 17 a) above requires that more than half of the votes cast at the Annual General Meeting approve the proposal. The Annual General Meeting’s resolution on transfer of own shares, according to item 17 b) above requires that shareholders representing at least nine-tenths of the votes cast as well as the shares represented at the Annual General Meeting approve the proposal.
Preparation of the proposal for the Share Program 2023
The proposal regarding the Share Program 2023 has been prepared by the People Committee and the Board of Directors.
Previous incentive programs in Electrolux
(CONTINUA)