Last checked at 8 Nov 2022 12:55
8 November 2022
Argentex Group PLC
("Argentex" or the "Group")
New Long Term Incentive Plan
Argentex Group PLC, the international provider of foreign exchange services to institutions, corporates and high net worth private individuals, today announces the establishment of a new Long Term Incentive Plan ("LTIP" or the "Plan") for its executive directors and senior management team in order to incentivise and encourage retention of senior employees in a manner that aligns with the interests of the Group's shareholders. The Company has consulted with certain of its larger institutional shareholders on the LTIP.
New Long Term Incentive Plan
The LTIP is a value creation plan based on delivering value above the current Argentex equity value over the next four financial years. The Plan provides the potential for participants to earn meaningful value on the basis of strong company and share price performance with the hurdles being:
- compound annual total shareholder return of 10% including dividends paid or declared; and
- 15% revenue CAGR over the performance periods.
Subject to these hurdles being met, plan participants will earn up to 10% of value created above the shareholder return hurdle. The Plan will be performance tested and awards vest based on the average share price over 20 trading days following the publication of full year December 2025 and December 2026 results based on the following split:
- 50% of awards tested, vest around April 2026; and
- 50% of awards tested, vest around April 2027.
30% of the awards will be granted to Argentex's three most senior executives which is split 12% to each of the CEO and COO and 6% to the CFO. Initial allocations to a further 39 employees across different seniority levels are being made as one off awards with a small number of new joiners to be awarded an allocation in the first few months after the LTIP's implementation.
Recipients of awards under the new LTIP will include certain of the Company's Persons Discharging Managerial Responsibility ("PDMRs") as follows:
PDMR | Role | % of total award | No. of existing options to be cancelled |
Harry Adams | CEO | 12% | - |
David Christie | Chief Operating Officer | 12% | 905,660 |
Jo Stent | Chief Financial Officer | 6% | 452,830 |
Awards made to the CEO, COO and CFO will be subject to a holding period of five years after the date awards are made.
The Plan will be adopted on 9 November 2022 with awards made shortly thereafter. As part of these arrangements, the Group will cancel participants' outstanding options in relation to the 2020 company share option plan (the "2020 CSOP") granted over, in aggregate, approximately 4.2 million ordinary shares. None of these options have vested to date. Under the 2020 CSOP, Argentex's CFO currently holds options over 452,830 Argentex shares and the COO holds options over 905,660 Argentex shares, both of which will be cancelled when the awards are made under the new Plan.
The new LTIP will be implemented by way of an issue of growth shares in a wholly owned subsidiary of Argentex whereby these growth shares will be acquired by participants at the outset at market value. Following vesting, the growth shares will be acquired by Argentex in exchange for ordinary shares in Argentex or, at Argentex's option, cash.
Dilution, caps, discretion and previous long term incentives
The Group continues to operate within typical UK 10% over 10 years dilution limits and will apply caps to the new LTIP at a total value of £35m and total dilution arising at 6.5% of current issued ordinary shares, with the Remuneration Committee retaining the ability to waive these caps in exceptional circumstances.
In line with UK governance best practice, the Plan rules contain a Remuneration Committee discretion to override formulaic outcomes to ensure Plan outcomes reflect overall corporate performance, the experience of shareholders in terms of value creation and exceptional negative events. The Plan contains malus and clawback provisions.
Commenting on the above arrangements, Lord Digby Jones, Non-Executive Chairman, said:
"The board has recognised the need to review our LTIP arrangements and put in place a plan that effectively motivates and incentivises the senior team appropriately. After consultation with certain of our larger institutional shareholders, we believe now is the right time to be implementing a new plan, following the announcement of our new strategy earlier this year and at such an exciting point in our journey, and I am delighted we have been able to confirm this new LTIP scheme for the team."
For further information, please contact:
Argentex Group PLC
Harry Adams - Chief Executive Officer
Jo Stent - Chief Financial Officer
investorrelations@argentex.com
FTI Consulting (Financial PR)
Ed Berry / Ambrose Fullalove / Jenny Boyd
argentex@fticonsulting.com
Singer Capital Markets (Nominated Adviser and Broker)
Tom Salvesen / James Maxwell / Justin McKeegan
020 7496 3000