Incentive plans

Executive stock options serve a number of roles in a modern enterprise:

• Align key personnel critical to company operations with the business

• Align the interests of shareholders with executive management. By enabling management to acquire shares, agency costs are minimized

• Drive performance by linking compensation directly to achieving pre-defined targets

• Reduce direct compensation costs for the Company

• Lower the tax burden for option holders

• Foster an ownership-driven organizational culture

• Enhance the Company’s attractiveness in the job market

What should the roadmap for designing an executive option program look like?

• Program modeling begins by defining key assumptions and setting the objectives to be achieved through the program

• The Company’s shareholders select key personnel to be covered by the program

• We select the type of financial instruments along with their grant price

• We also define the conditions that must be met for an employee to vest the right to acquire the instruments

• We establish the exercise period for these rights

• Detailed program regulations are drafted in cooperation with legal counsel

• We optimize costs and their P&L impact in accordance with IFRS

• We value the cost of the incentive plan

• We monitor the execution and exercise of executive options

• We liaise with the statutory auditor reviewing the Company’s financial statements to agree on and approve the valuation and cost recognition principles

What do we offer? We offer a comprehensive range of advisory services enabling the effective and seamless implementation of executive option plans within your Company:

• Advisory services on designing executive option plans tailored to the Company’s needs and strategy

• Program design carried out in collaboration with a statutory auditor to minimize plan costs required to be recognized in financial statements under International Financial Reporting Standard 2 (IFRS 2)

• Valuation of the incentive plan using valuation models defined in IFRS 2

• Legal advisory on implementing executive options (detailed plan regulations, AGM resolutions, etc.)

• Training for company management to ensure effective utilization of granted financial instruments and to foster an ownership culture among plan beneficiaries