Employee Profit-Sharing Plan
In 2021, Bittium had an employee profit-sharing plan that applies to all employees, excluding those covered by other short-term bonus plans. According to the 2021 profit-sharing plan, a separately defined part of Bittium´s operating profit will be distributed to employees as a profit-sharing bonus in proportion to salaries. The goal of the system is to enable the company´s success to be shared with employees and to engage employees.
The variable pay is paid based on the achievement of goals. In 2021, earning period for the variable pay was the calendar year. The targets are determined separately for each earning period. The setting of targets and the review of their achievement is decided on a one-over-one basis. The criteria for the short-term merit pay are the financial and strategic targets of the Company. In 2020, operating result formed the financial targets. In addition, part of the targets may be other Company objectives or personal targets. Personal targets vary between duties.
Management Share-Based Incentive Plan
The management of Bittium group share-based long-term incentive scheme which comprises a Performance Share Plan (“PSP´). The objectives of the Performance Share Plan are to align the interests of Bittium´s management with those of the Company´s shareholders and, thus, to promote shareholder value creation in the long term, to commit the management to achieving Bittium´s strategic targets and the retention of Bittium´s management. The Performance Share Plan consists of three annually commencing three-year performance share plans, PSP 20202022, PSP 20212023 and PSP 20222024, each with a one-year performance period, which is followed by the payment of the share reward and a two-year transfer restriction period. The commencement of each plan is, however, subject to a separate Board decision. Further information can be found at the company´s internet pages at the address www.bittium.com.
On February 11, 2021, the Board of Directors of Bittium Corporation decided on the new period in the share-based long-term incentive scheme for the Bittium group´s management. The members of Bittium´s Management Group are eligible to participate in the second PSP 20212023 plan. The performance measures based on which the potential share reward under PSP 20212023 will be paid are the revenue growth and cash flow before financial items of Bittium. A precondition for the payment of the share reward is, in addition, that the employment relationship of the participant with Bittium continues at the time the reward is paid. The potential reward will be paid in shares of Bittium. If all the performance targets set for the second plan, PSP 20212023, are fully achieved, the aggregate maximum number of shares to be paid based on this second plan is approximately 111,900 shares (gross before the withholding of the applicable payroll tax). The aggregate gross value of PSP 20212023, estimated based on the volume-weighted average quotation of Bittium´s share during the period H2/2020, is approximately EUR 0.7 million.
On March 24, 2021, the Board of Directors of Bittium Corporation decided on a directed share issue without consideration for the payment of the share rewards based on the Company´s share-based incentive scheme to the Company´s management. The directed share issue without consideration decided was about the first Performance Share Plan (PSP 20202022) of the share-based incentive scheme. In the Share Issue 9,098 new shares of the Company was issued without consideration to the management entitled to share rewards according to the terms and conditions of the share-based incentive scheme. A total of nine persons of the Company´s management group were in the target group of the payment.
On March 29, 2021, the new shares issued without consideration were registered in the Trade Register. After the registration, the total number of Bittium Corporation shares was 35,702,264. The newly registered shares were admitted to trading on the Nasdaq Helsinki stock exchange on March 30, 2021.