Long-term Incentive Programme 2015 (LTIP 2015)

Incentive programme 2015

The purpose of the LTIP 2015, as approved by the Annual General Meeting (AGM) of Eltel AB (publ) on May 19, 2015, is to increase the attractiveness of the group as an employer on the global market, making it easier to retain and recruit qualified key individuals.

Basic features of LTIP 2015

LTIP 2015 was directed towards 70 key individuals in the Eltel Group. Participation in LTIP 2015 assumes that the participant acquires and locks Eltel ordinary shares into LTIP 2015 (“Savings Shares”).

For each acquired Savings Share, the participant is entitled, after a certain qualification period (defined below) and provided continued employment during the entire period, to receive an allotment of Eltel matching shares (“Matching Share”). Dependent on the fulfilment of certain performance targets linked to Eltel’s earnings per share for the financial year 2017, the participant may also be entitled to receive allotment of additional Eltel shares (”Performance Shares”). The participant shall not pay any consideration for the allotted Matching Shares and Performance Shares. Matching Shares and Performance Shares are Eltel ordinary shares.

Participation in LTIP 2015

LTIP 2015 is directed towards three categories of participants:

Category Savings Shares maximum (% of base salary) Matching Shares per Savings share Performance Shares per Savings share
A (CEO) 20% 1.68x* 4.0x
B (Group Management Team (GMT), maximum 10 persons) 15% 1.68x* 3.0x
C (individuals reporting directly to GMT and other key employees, maximum 59 persons) 10% 1.68x* 2.0x

The maximum number of Savings Shares for each participant is based on an investment in Eltel shares with an amount corresponding to a certain portion of the concerned participant’s base salary level for the current year.

The Savings shares covered by the LTIP 2015 program were acquired in a structured way in ordinary trading in the stock market during 2015.

Allotment of Matching Shares and Performance Shares

Allotment of Matching Shares and Performance Shares within LTIP 2015 will be made during a limited period of time following presentation of the first quarterly statement 2018.

The performance targets are Eltel’s earnings per share for the financial year 2017. Partial fulfilment of the performance targets will result in partial allotment of Performance Shares. Performance under a certain level will result in no allotment.

* in order to compensate for the dilution effect of the EUR 150 million preferential rights issue in June 2017, the calculation of the number of Matching Shares to be received in relation to the Savings Shares was adjusted from original 1.0x to 1.68x in September 2017.

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Eltel AB POB 126 23, SE-112 92 Stockholm, Sweden

Tel. +46 8 585 376 00 | E-mail: info@eltelnetworks.com