The AA operates a Share Incentive Plan (SIP). Under the SIP, employees are granted the option to buy partnership shares by making weekly or monthly payments into the SIP. In addition, for every partnership share an employee purchases, the Company will match this on a 1:1 basis.
Employees need to hold both their purchased shares and any matching shares we issue for a minimum of three years to keep the matching shares and a full five years to gain the tax advantage on the shares and the matching award.
In 2015 the AA’s benefits trust (EBT) purchased ordinary shares at a value of £15m which have been used in a LTBP to incentivise senior management below Board level and to align their interests with shareholders. LTBP awards are made to selected key contributors who play an important role in the Company’s long-term success. Executive directors are not eligible to participate in the LTBP.
The awards were divided into three tranches, A, B and C. These awards will vest following the satisfaction of a Total Shareholder Return (TSR) performance condition of 12% per annum compound growth against the admission price which is tested on the third, fourth and fifth anniversary of admission to the London Stock Exchange.
MVP shares are a one-off share structure implemented at admission to link reward with Company performance and long-term shareholder value. The awards are share-based which facilitate Executive share ownership and further align the interests of participants and shareholders.
MVP shares are classified under A, B and C shares. The value of shares is dependent on the Total Shareholder Return (TSR) generated over a three to five-year period following admission to the London Stock Exchange in June 2014. On the third, fourth and fifth anniversary of admission, the shares may be converted into ordinary shares following satisfaction of a performance condition.
The performance condition is that the TSR per annum from admission to the relevant measure point is equal to or more than 12%. If the performance condition is met the value of the MVP shares shall be; 5% of the TSR up to the performance condition, plus 10% of the amount by which the TSR exceeds the performance condition.
Fanum House, Basing View, Basingstoke, RG21 4EA.
Company number: 5149111
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