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Stock Program "Aspire 2.0" (as per Performance Period 2016)
Long-term incentive program for members of the Board of Management and upper Management level
Beginning 2016, the long-term cash-based Stock Program Aspire 2.0 was introduced, being equally valid for members of the Board of Management and all eligible leaders of the upper Management.
Members of the Board and upper Management level are required to purchase a certain number of Bayer shares that is predetermined according to the specific Share Ownership Guidelines and retain them through private investment for the full term of the program in order to become eligible.
- Consistent basis for Aspire across all eligible Management levels, is a percentage of the participants annual base salary based on his/her position, defining the target for variable payments (Aspire target opportunity) – expressed in virtual Shares. The number of virtual shares granted depends on the contractual agreed target opportunity and the individual STI payout factor, which reflects business as well as individual results of the fiscal year, prior to the grant of a new performance period. The payment at vest considers not only the share price development but also payment of dividends at the end of each Performance Period.
- For members of the Board of Management an additional payout hurdle is considered, taking the relative performance against the share index Euro Stoxx 50 into account: The relative performance of the Bayer share against the share index is measured linear, with a maximum impact of +/-50% of the final payment of the award. The former performance matrix does not exist anymore.
Example: If the Bayer share increases by 10% during the 4-year performance period, but the Euro Stoxx 50 increases by 30%, 88% of the grant value is paid out.
- For the middle management the fulfillment of the Share Ownership Guidelines is not required.
At the end of each performance period, participants receive an award between 0 and 250% of the Aspire target opportunity (Overall-Cap). Performance periods start on January 1st and run for four years in total (ending December 31st of the fourth year).
Further information on the compensation of the Board of Management is provided in Chapter 16.4.1 of the Annual Report 2015.
Long-term incentive program for members of the Board of Management and other senior executives (Aspire I)
To participate in Aspire I, members of the Board of Management and other senior executives are required to purchase a certain number of Bayer shares that is predetermined according to specific guidelines and to retain them for the full term of the program. A percentage of the executive’s annual base salary – based on his/her position – is defined as a target for variable payments (Aspire target opportunity). Depending on the performance of Bayer stock, both in absolute terms and relative to the EuroStoxx 50 benchmark index over a four-year performance period, participants are granted an award of up to 300 % of their individual Aspire target opportunity at the end of the program.
Aspire performance periods start on January 1st and run for four years in total (ending on December 31st of the fourth year).
The Performance Matrix can be described as follows:
- If Bayer's share price gain is less than 6% and does not outperform the EuroStoxx 50, no Aspire awards will be provided.
- If Bayer's share price gain is 20% and this gain is greater than -0.99% but less than 1.99% of the gain of the EuroStoxx 50, the award is 100% of Aspire target opportunity.
- If Bayer's share price gain is 35% or more and Bayer outperforms the EuroStoxx 50 by 10 percentage points or more, the maximum award is 300% of Aspire target opportunity.
Long-term incentive program for middle management (Aspire II)
A variant of the Aspire program with the following modifications is also offered to middle management:
- The fulfillment of Share Ownership Guidelines is not required.
- The award opportunity is solely based on the Bayer share price development, regardless of performance relative to the EuroStoxx 50.
- Participants can receive an award that amounts between 0 % and 250 % of the target amount.