Long Term Incentive Program

Telia Company offers a long-term incentive (LTI) program for key employees. The program is not available for members of Group Executive Management.

The Annual General Meeting on 5 April, 2017 resolved to launch a long-term incentive program, LTI Program 2017/2020.

  • Maximum number of participants is approximately 200

  • The reward is share based

  • Maximum number of performance shares an individual can receive corresponds to 30% of annual base salary

  • The maximum value of the award is capped at 60% of annual base salary

  • The program measures performance over a three-year period, 2017-2019

  • No initial investment required by the participant

  • KPI:s are earnings before interest, tax, depreciation and amortisation (EBTIDA) and total shareholder return (TSR) compared to a corresponding TSR development of a pre-defined peer group of companies.

  • EBTIDA part represents 50% of the total award (or 15% of the participant’s annual salary

    • If 100 percent (or above) of the EBITDA target is met, 100 percent of Performance Shares under the EBITDA part will vest.

    • If 97.5 percent (or less) of the target is met, 0 percent of Performance Shares under the EBITDA part will vest

    • If between 97.5 to 100 percent of the target is met, a proportionate amount of Performance Shares under the EBITDA part will vest.

    • No Performance Shares will vest under the EBITDA Part if the Company’s accumulated EBITDA is below the minimum level (97.5%) and no additional Performance Shares will vest if the Company’s accumulated EBITDA is above the maximum level (100%).

  • TSR part represents 50 percent of the total award (or 15 percent of the participant’s annual salary):

    • If the Company’s TSR is ranked First or Second compared to the defined peer group of companies, 100 percent of the Performance Shares under the TSR part will vest.

    • If the Company’s TSR is ranked Third of Fourth, 75 percent of the Performance Shares under the TSR part will vest.

    • If the Company’s TSR is ranked Fifth or Sixth, 50 percent of the Performance Shares under the TSR part will vest.

    • If the Company’s TSR is ranked Seventh or lower, no Performance Shares under the TSR part will vest.

The defined peer group include Telenor ASA, Elisa Oyj, Tele2 AB, KPN NV, Orange S.A., Deutsche Telekom AG, Vodafone Group Plc, Telefonica SA, TDC A/S and Swisscom AG.

Outcome

Below is the outcome for each completed program.

  • LTI Program 2010/2013 = 4.33% (of maximum 30%)

  • LTI Program 2011/2014 = 6.25% (of maximum 30%)

  • LTI Program 2012/2015 = 13.13% (of maximum 30%)

  • LTI Program 2013/2016 = 5.63% (of maximum 30%)

  • LTI Program 2014/2017 = 4.20% (of maximum 30%)

Long-Term Incentives - Result by program and KPI

For more information on Telia Company’s LTI programs, see Note C31 to the consolidated financial statements.