Better Collective (BC) has implemented a new Long Term Incentive Plan (LTI) for key employees, offering grants of performance share units and share options if the business hits its financial targets in the coming years.
Origins of the Long Term Incentive PlanThe LTI, which was designed by BC’s remuneration committee and approved by its board of directors, aims to help the business retain, motivate and reward a select group of key employees.
The plan is also intended to support sustainable value creation for BC shareholders, while better aligning the interests of LTI participants with those of the shareholders, the firm said.
What does the plan include?
Grants under the LTI in 2023 will consist of 134,953 performance share units and 239,350 share options to be granted to 63 key employees in total.
The programme is intended to work on a revolving basis with a yearly grant, the size and future allocation of which will be at the full discretion of the BC board.
What’s it worth?The total value of 2023’s LTI grant programme is calculated to be €2.9m, given that BC reaches 100% of its financial targets over the next three years.
If the firm’s financial goals are not met, the value of the grants will be zero, however another stipulation allows for the value of the grants to increase to €4.4m in the event of exceptional performance above targets.
How does it work?
The performance share units and share options granted this year will vest based on BC’s overall performance compared to certain KPIs.
Subject to each participant’s continued employment and achievement of KPIs (based on the group’s aggregated revenue and EBITDA for the years 2023-2025) share options will vest following the board’s approval of the 2025 audited annual accounts in February 2026.
Will it affect the bottom line?
BC said the grant value of the programme will be evenly expensed as an employee remuneration cost during the vesting period.
The grants will have no dilutive effect on BC shareholders, the firm said, as the business will meet its obligations by way of treasury shares acquired in share buyback programmes.