Long-term incentive plan based established for Raute's senior management and selected key persons
RAUTE CORPORATION STOCK EXCHANGE RELEASE 15 FEBRUARY 2024 at 9:15 a.m.
LONG-TERM INCENTIVE PLAN ESTABLISHED FOR RAUTE’S SENIOR MANAGEMENT AND SELECTED KEY PERSONS
Raute Corporation’s Board of Directors has decided on the commencement of a long-term incentive plan for the Group’s senior management and selected key persons. The decision includes a Performance Share Plan (“PSP”) as the main structure and a restricted Share Plan (“RSP”) as a complementary structure.
The purpose of the plan is to align the objectives of the owners and management in order to develop the company’s value for the long term, as well as to commit the company’s management and key persons to the company and to achieving the company’s strategic goals.
Performance Share Plan
PSP 2024–2026 begins at the start of 2024 and covers an earnings period of three years, with two performance indicators applied. The first performance indicator is the EBITDA, and its weight is 60 percent. The second performance indicator is the net sales target, with a weight of 40 percent. Any possible rewards based on both performance indicators will be paid after the three-year plan ends and the financial statements have been completed, in spring of 2027, provided that the performance targets set by the Board of Directors have been achieved. The potential rewards will be paid in Raute’s shares or in cash, or as a combination thereof. Persons belonging to Raute Group’s Executive Board are entitled to participate in the PSP 2024–2026 plan.
The Board of Directors is entitled to limit the rewards paid under the long-term incentive plan PSP if the reward would exceed the threshold value of the fixed annual gross salary of the individual in question. If the participant’s service or employment relationship ends before the payment of the reward, the reward is generally not paid.
If the performance targets set for the plan beginning at the start of 2024 are fully achieved, the aggregate maximum amount of rewards to be paid based on the plan in question will correspond to the value of approximately 53 000 the company’s shares. Aggregate amount of rewards means their gross amount before the withholding of the applicable payroll tax.
Restricted Share Plan
The Restricted Share Programme consists of annually commencing individual share plans, each comprising a retention period with an overall length of three years. Each individual plan comprises an overall three-year plan period within which the company may grant fixed share rewards to individually selected key employees, including Raute Executive Board, with a retention period of up to three years. The share reward will be paid after the retention period applied to the respective individual share grant. The company may choose to pay the granted share rewards in one or several tranches within the limits of the overall three-year plan period.
The RSP plan, covering the years 2024-2026, commences as of the beginning of the year 2024. The aggregate maximum number of shares which may become payable based on RSP 2024–2026 is 68 000 shares (referring to gross reward from which the applicable payroll tax is withheld).
The rewards payable based on RSP will at the company’ choice either be paid in shares of Raute or in cash based on the value of the share reward at the time of payment. The payment of the reward is conditional on the individual’s continued employment or service relationship with Raute.
The maximum value of the reward payable to the participants based on RSP is limited by a cap which is linked to Raute’s share price development with a multiplier set by the company.
Other terms
In accordance with the ownership recommendation the company abides by, the members of the company’s Executive Board are expected to accrue and, after attaining, to retain in their ownership an amount of the company’s shares that equals, for the CEO, his/her gross annual fixed salary, and for the other Executive Board members, their six months’ gross fixed salary. The members of the Executive Board are expected to use 50 per cent of the net bonus he/she receives from the plan to accrue his/her share ownership until such ownership meets the level recommended above. Share ownership accrues either by retaining ownership of bonuses received as shares or by acquiring shares through cash bonuses received under the plan.
RAUTE CORPORATION
Board of Directors
FURTHER INFORMATION:
Laura Raitio, Chair of the Board of Directors, mobile number +358 50 386 0004
DISTRIBUTION:
Nasdaq Helsinki Ltd, main media, www.raute.com
RAUTE IN BRIEF - Making Wood Matter
Raute is the partner to future-proof the wood industry. Our technologies cover different production processes with supporting digital and analytics solutions for engineered wood products. Additionally, we offer full-scale service concept ranging from spare parts to regular maintenance and modernizations. Our innovative hardware and software solutions are designed to support our customers’ efficient consumption of natural resources. In mill-scale projects, Raute is a global market leader both in the plywood and LVL industries. Raute’s head office and main production is located in Lahti, Finland. The company’s other production plants are located in Kajaani, Finland, the Vancouver area of Canada, Changzhou, China, and in Pullman, WA, USA. Raute’s net sales in 2023 were EUR 145.4 million. The Group’s headcount at the end of 2023 was 754. More information about the company can be found at www.raute.com.