Equity Incentive Plans
The Restricted Share Unit plan (RSU plan) and the Performance Share Unit plan (PSU plan), adopted at the shareholders’ meeting in July 2011, are designed to enhance the long-term performance of the company and to retain key employees. Yearly grants under the RSU plan and the PSU plan are subject to the approval of the annual general meeting of shareholders. The two plans are intended to complete Aperam’s existing programme of annual performance-related bonuses, the reward system for short-term performance and achievements.
Both plans are intended to promote the alignment of interests between the company’s shareholders and eligible employees by allowing them to participate in the success of the company.
The Company’s Equity Incentive Plans are described in detail in the Company’s Annual Report .
Restricted Share Unit (RSU) plan
The RSU plan provides a retention incentive to eligible employees. Awards made under the RSU plan are subject to ‘cliff vesting’ after three years, contingent upon the continued active employment of the employee with the Aperam group. The RSU plan is targeted at the 30 most senior managers across the Aperam group. No RSUs are granted to Leadership Team Members since the May 2012 plans submitted to shareholder approval.
Leadership Team Share Unit (LT PSU) plan
The Leadership Team Performance Share Unit Plan (the “LT PSU Plan”) is designed to enhance the long-term performance of the Company and align the members of the Company’s Leadership Team (“LT”) to the Company’s objectives. The LT PSU Plan complements Aperam’s existing program of annual performance-related bonuses which is the Company’s reward system for short-term performance and achievements. The main objective of the LT PSU Plan is to be an effective performance-enhancing scheme for LT members based on the achievement of Aperam’s strategy aimed at creating measurable long-term shareholder value.
The allocation of RSUs and PSUs to eligible employees under the RSU plan and the LT PSU plan is reviewed by the Board of Directors’ Remuneration, Nomination and Corporate Governance Committee, comprised of three independent directors, which makes a recommendation to the full Board of Directors. The committee also decides the criteria for granting PSUs and makes its recommendation to the Board of Directors. The criteria are based on the principle of rewarding for performance upon the achievement of clear and measurable metrics for shareholder value creation.