Annual Accounts and Report as at 30 June 2011 Draft - Mediobanca

g. Performance share schemeIn connection with the equity instruments to be used as components of staffremuneration, Mediobanca has adopted a performance share scheme, which wasapproved by shareholders at a general meeting held on 28 October 2010 andrevised by the Board of Directors on 24 June 2011, in exercise of the powersgranted to it, to bring it in line with the Instructions.The scheme is an incentivization system involving the award of shares toemployees. The shares will be awarded at the end of a three-year vesting period(save as provided below for the upfront component) provided that the beneficiaryis still employed by the Group and further provided that certain conditions aremet at the time of the award. The performance conditions are identified in theRemunerations policies in force at the time. The performance shares are allocatedas a deferred equity component, subsequent to the performance conditions for therelevant year being met, are subject to a further holding period (the beneficiarycontinuing to be an employee of Mediobanca) of at least one year prior to theiractual assignation. The performance shares allocated as an upfront equitycomponent are subject to a two-year holding period prior to their actualassignation. The competent governing bodies award quantities of performanceshares on a regular basis, generally once a year, from the upper limit approved byshareholders in the general meeting held on 28 October 2010 or alternativelyfrom the treasury shares owned by the Bank. The maximum number of shares thatmay be awarded under the terms of this scheme is 20 million (a total of17,478,303 are outstanding) pursuant to the resolution approved on 28 October2010, plus up to 17,010,000 treasury shares owned by the Bank, provided thatthe use of the latter remains uncertain because the resolution adopted byshareholders in the general meeting held on 27 October 2007 in respect of themspecified other uses (consideration to acquire investments, possible assignment toshareholders).The Chief Executive Officer may also use this instrument to defineremuneration packages upon the occasion of recruiting new key staff, includingoutside the annual award cycle.h. Performance stock option schemeAt an extraordinary general meeting held on 27 June 2007, the shareholdersof Mediobanca approved a capital increase involving the issue of 40,000,000shares (to be awarded by June 2014), for use as part of a stock option scheme;now that 17,171,000 shares have been awarded, a total of 22,829,000. At anordinary general meeting held on 27 October 2007, in accordance with theprovisions of the regulatory instructions, the shareholders of Mediobancaapproved a resolution to adopt the scheme and its methods of implementation.502 –