Share-based Payments

Share incentive scheme and management ownership

The company has a share bonus system as a part of its key personnel commitment and incentive scheme. With authorisation received at the AGM, the Board made a decision on the CEO’s share-based incentive scheme in spring 2010.

The scheme comprises four earning periods, which are the calendar years 2010–2013. According to the scheme, rewards totalling a maximum value equivalent to 100,000 shares will be paid for each of the earning periods from 2011 to 2013, based on the fulfilment of earning criteria set by the Board. For 2013 the reward will be determined based on the company’s earnings per share and net sales, according to principles set separately by the Board.

Based on the aforementioned scheme, the CEO was paid a reward equivalent to the value of 35,000 shares in 2013, based on the results from 2012. The bonus was paid in the form of shares held by the company.

In addition to the CEO, the scheme applies to the company’s other management team members, who are entitled to share the same share bonus that the CEO receives. Based on the scheme, the management team members were paid a reward equivalent to the value of 35,000 shares in 2013.

Additionally, a sum equivalent to the value of 21,500 shares was paid to specified key personnel of the company during the financial year. The rewards are paid in four equal instalments between 2010 and 2013, based on the results from 2009.

All bonuses are paid as a 50/50 combination of shares and cash. The cash portion of the bonus will primarily be used to cover taxes and other comparable costs of the scheme. The system involves no vesting periods limiting the sale of shares.

The payment of bonuses according to the share-based incentive schemes is subject to the employee in question being employed by the company on the payment date.

On 19 December 2013 the Board decided to establish a new share-based incentive scheme for the CEO and other members of the top management. The scheme comprises three earning periods, which are the calendar years 2014–2016. The earning criteria are the Group’s earnings per share and net sales, which are applied according to procedures approved annually by the Board. The scheme comprises a maximum reward equal to the value of 200,000 shares.

According to the list of shareholders dated 31 December 2013, Digia’s Board of Directors and CEO owned shares in the company as follows:

Pertti Kyttälä                                                                                                                            0
Robert Ingman 20,000
Kari Karvinen 1,259,912
Tommi Uhari 0
Juha Varelius 184,758
Päivi Hokkanen 8,170
Seppo Ruotsalainen 0
Leena Saarinen  1,600

At the year-end, the shares held by the Board members and the CEO represented 7.1% of the company’s shares and votes.