24.1 Employee share plans

In 2020, the General Annual Meeting of Grupa Kęty S.A. passed another share options plan for the Group key personnel.  

The 2020 plan is divided into three tranches. Vesting periods for share options under the first tranche start in the launch year of the plan, and for the subsequent tranches – in the subsequent years. Each of the tranches is divided into four sub-parts: A, B, C, and D.

A common element for all of the aforesaid plans is the required three-year employment period at the Capital Group calculated separately for each tranche, starting from the date of its launch.

The ‘return on shares’ for a given tranche of the 2020 plan is understood as the quotient of the average price of Grupa Kęty S.A. shares in 2022, increased for the value of dividend paid by the company in the period from 1 January 2020 to 31 December 2022, to the price of shares in 2019.  

‘EBITDA increase’ per share (where EBITDA is understood to be profit on operating activities plus depreciation) means the quotient of consolidated EBITDA per share attained by the Capital Group of Grupa Kęty S.A. in the second year following the launch year of a given tranche and consolidated EBITDA per share attained by the Capital Group of Grupa Kęty S.A. in the year directly preceding the tranche launch year. 

‘Net earnings increase’ per share for a given tranche means the quotient of consolidated net earnings per share attained by the Capital Group of Grupa Kęty S.A. in the second year following the launch year of a given tranche, to consolidated net earnings per share attained by the Capital Group of Grupa Kęty S.A. in the year directly preceding the tranche launch year.

For the second tranche of the 2020 plan, the above reference periods are shifted for 1 year, and for the third tranche they are shifted for 2 years. 

The right to acquire share options will arise following the satisfaction of the plan conditions. 

The purchase price of the 2020 plan shares equals the average price of the shares of Grupa Kęty S.A. for the period of 12 months preceding the General Meeting that adopts the given plan, less 5%. 

The main objectives of the share option plans comprise additional motivation of a larger group of employees to increase the shareholder value, and introduction of a factor making it possible to retain the key employees of the Grupa Kęty S.A. Capital Group on a long-term basis.

The fair value of employee share plans is estimated as of the options granting day based on a binominal model.  

The expected period of options validity is determined on the basis of historical data and does not need to explicitly imply the possible ways of exercising them. The assumed volatility index reflects the assumption that the historical volatility index indicates future trends which, naturally, may be completely different in reality. 

Upon the measurement of the fair value, no other characteristics concerning the granting of options were taken into consideration.

The Group monitors the probability of attaining the non-market parameters on an ongoing basis and takes them into account in the number of share options assumed for the valuation of the particular tranches as at the balance-sheet date.

The Group recognises the scheme costs proportionally to the vesting period for options granted to the employees. 

The amounts recognised below increased remuneration costs in the period as well as the Group equity. 

Future costs of share options plans are as follows: 

Tabular compilation of the information about managerial options of the Group employees: