VEON announces details of new incentive plan aligned with total shareholder return

Rhea-AI Summary

VEON Ltd. (NASDAQ: VEON) announced a revised Group Executive Committee (GEC) incentive plan, effective from the 2022 Short Term Incentive (STI) awards. The STI now comprises 50% shares and 50% cash, linked to financial and non-financial KPIs. A new Long Term Incentive (LTI) scheme has been introduced, measuring total shareholder return over three years. GEC members must achieve a minimum shareholding of 6.0x for the CEO and 2.0x for others. A one-off share award has also been granted to offset initial cash losses from the STI revision.

Positive

• Introduction of a revised STI scheme linking performance to financial and non-financial KPIs.
• Launch of a new LTI scheme based on total shareholder return relative to peers, promoting long-term shareholder alignment.
• Mandatory shareholding requirements for GEC members to align management interests with shareholders.

Negative

• Initial cash compensation loss for GEC members due to STI changes, leading to a one-off share award.

AMSTERDAM, Feb. 28, 2022 /PRNewswire/ -- VEON Ltd. (NASDAQ: VEON) (Euronext Amsterdam: VEON), a leading global provider of connectivity and internet services, today announces the details regarding its new incentive plan for the Group GEC.

Following our initial communication on 7 December 2021, we have today announced finalisation of the incentive plan rules and the details of the specific awards. As previously communicated,  this includes a number of key elements:

i.  The existing annual cash Short Term Incentive (STI) scheme for the Group Executive Committee ("GEC"), has been revised to a 50:50 shares:cash scheme and this scheme is effective from the STI award for the year 2022. The STI award is linked to certain financial and non-financial KPIs determined for each calendar year.

ii.  We have introduced a new Long Term Incentive (LTI) scheme. The LTI scheme is an annual rolling plan with a performance period of three years. The vesting of the LTI award is linked to total shareholder return (TSR) relative performance against a basket of peers and will be measured over the three year vesting period.

iii.  The LTI 2021 share award as detailed in the table below is the award related to the three-year period from 1 January 2021 through to 31 December 2023.  

iv.  GEC members will be required to over time achieve and then maintain a minimum level of VEON shares. This will be 6.0x annual base salary for the Group CEO and 2.0x annual base salary for other GEC members.

	DEFERRED SHARE PLAN	LTI 2021
	# Shares	# Shares
Kaan Terzioglu	1,549,800	2,583,000
Serkan Okandan	444,343	1,777,372
Dmitry Shvets	191,429	765,715
Alex Bolis	128,572	514,286
Joop Brakenhoff	393,236	740,572
Michael Schulz	291,429	582,858
TOTAL	2,998,809	6,963,803

In order to compensate GEC members for the initial loss of cash due to the introduction of 50% shares into the STI scheme effective 2022, a one-off share award has been granted. The shares have been awarded pursuant to VEON's Deferred Share Plan, with up to a two year vesting period on the shares.

Kaan Terzioğlu, VEON's CEO, said: "As the management team continues to build its shareholding in the Group over the next few years, we will be more closely aligned with our shareholders objectives."

Disclaimer

This release contains "forward-looking statements", as the phrase is defined in Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. Forward-looking statements are not historical facts, and include statements relating to, among other things, expectations regarding the benefits of VEON's Deferred Share Plan and Long Term Incentive scheme. Forward-looking statements are inherently subject to risks and uncertainties, many of which VEON cannot predict with accuracy and some of which VEON might not even anticipate. The forward-looking statements contained in this release speak only as of the date of this release. VEON does not undertake to publicly update, except as required by U.S. federal securities laws, any forward-looking statement to reflect events or circumstances after such dates or to reflect the occurrence of unanticipated events.

About VEON

VEON is a NASDAQ and Euronext Amsterdam-listed global provider of connectivity and internet services.  For more information visit: www.veon.com.

Contact Information

VEON
Investor Relations
Nik Kershaw
ir@veon.com
+31 20 79 77 200 

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SOURCE VEON Ltd

FAQ

What is VEON's new incentive plan for 2022?

VEON's new incentive plan revises the STI to a 50:50 shares-to-cash ratio and introduces a Long Term Incentive scheme, effective for the 2022 awards.

How does the new Long Term Incentive scheme work?

The new Long Term Incentive scheme measures total shareholder return against peers over a three-year period to align GEC performance with shareholder interests.

What are the shareholding requirements for VEON's GEC members?

GEC members must achieve and maintain a minimum shareholding of 6.0 times their annual base salary for the CEO and 2.0 times for other members.

Why was a one-off share award granted to VEON's GEC?

The one-off share award compensates GEC members for the initial cash loss due to the introduction of shares into the STI scheme.

When was the initial communication regarding VEON's incentive plan?

The initial communication about the incentive plan was made on December 7, 2021.