Marel - Issuance of stock options

Marel hf. - Issuance of Stock Options

The Board of Directors of Marel hf. resolved on 6 June 2019 to grant to selected employees in strategic positions 4.1 million shares in the company through stock option agreements.

The aim of the stock option agreements is to align long-term interests of employees and of the Company. The key terms and conditions of the new stock option program were approved by Marel’s Annual General Meeting on 6 March 2019 in accordance with the Company's Remuneration Policy as approved at the same meeting.

Key terms and conditions of the agreements are as follows:

• The stock option agreements entitle purchase of shares at the base offering price of EUR 3.70 per share.¹ The exercise price shall be adjusted for any dividend payments decided after the grant date.
• One vesting period of 3 years. Exercise periods are two per year in April and October subject to disclosure of the respective Q1 and Q3 financials. First exercise period will be following the publication of the Q3 2022 results. Option holders can delay exercise of these options following disclosure of Q3 2023 results, when the agreements expire and all unexercised options are cancelled.
• The options are valid only if the holder is still employed by Marel group (Marel hf. or its subsidiaries) at the time of vesting.

The total number of unexercised stock options granted by Marel hf., including this new stock option scheme, currently amounts to 19.6 million shares corresponding to approximately 2.6% of total issued share capital. The Company’s cost of the new share option scheme is estimated to be approximately EUR 2.5 million over the next 3 years based on the option-pricing model of Black-Scholes.

Contractual arrangements concerning the issuance of stock options will take place after public disclosure of Marel’s second quarter financial results, scheduled to take place on 24 July 2019.

¹ The exercise price is determined by the price of shares sold in Marel’s offering of new shares which ended on 6 June 2019.