#Denmark #RSUs #Hellerup #TORM plc #Incentive Program

TORM plc's Long-Term Incentive Program

On March 6, 2025, TORM plc, a prominent carrier of refined oil products based in Hellerup, Denmark, announced the initiation of its Long-Term Incentive Program. This program, aligned with the Remuneration Policy ratified during the Annual General Meeting on April 14, 2021, is designed to reward select employees for their contributions to the company's performance and enhance shareholder value.

Introduction of Restricted Share Units (RSUs)

The program enables the grant of Restricted Share Units (RSUs) to designated employees, known as Participants, in the form of restricted stock options. The primary intention of this initiative is to encourage Participants to actively contribute to the enhancement of TORM’s performance, ultimately benefiting both themselves and the shareholders through an uplift in TORM's share price.

For the year 2025, the total number of RSUs awarded amounts to 1,326,087. Each RSU allows the holder to acquire one A-share of TORM upon vesting. Over a gradual three-year period beginning January 1, 2025, these RSUs will vest, with one-third becoming available for exercise on each anniversary.

Vesting Schedule and Pricing Details

The exercise price for acquiring each TORM A-share stands at DKK 162.38. This price reflects the average share price from the 90-day period preceding TORM's 2024 Annual Report publication, with an additional 15% premium included. Once vested, Participants can exercise their RSUs during a window of 360 days from each vesting date, providing them an opportunity to convert their stock options into shares.

In a similar accord, Executive Director Jacob Meldgaard is set to receive a total of 255,200 RSUs, following the same terms outlined for other Participants.

Market Value and Financial Implications

According to the Black-Scholes model, the theoretical market value of the RSU allocation is estimated at USD 4.1 million. This calculation considers various factors, such as adjustments for future dividends, projected share volatility of 42.5%, and Danish government bond interest rates, which range from 1.96% to 2.12% based on the RSUs' maturity. The current share price at allocation is noted at DKK 120.40 per A-share.

The impact of the RSU allocation on TORM's Profit and Loss statement is projected over three years, with anticipated effects of USD 2.2 million for 2025, USD 1.3 million for 2026, and USD 0.6 million for 2027, culminating in a total of USD 4.1 million.

Shareholder Rights and Conditions

Importantly, holders of the RSUs will not possess shareholder rights concerning the RSUs until they vest, are executed, and TORM A-shares are issued. The RSUs come with customary adjustment and acceleration provisions, exercise conditions, and other pertinent terms controlling the nature of such programs.

About TORM plc

Founded in 1889, TORM plc is recognized as one of the world’s leading carriers of refined oil products, boasting a fleet of product tanker vessels while prioritizing safety, environmental responsibility, and customer satisfaction. TORM operates globally and is publicly traded on the Nasdaq in both Copenhagen and New York under the ticker symbols TRMD A and TRMD, respectively. More information can be found on TORM's official website at www.torm.com.

Conclusion

TORM plc’s Long-Term Incentive Program represents a strategic move to align employee interests with shareholder goals. The structured rollout of RSUs over a span of three years not only incentivizes employee performance but also fosters a culture of growth and accountability within the organization. This initiative clearly marks TORM’s commitment to building long-term value for its shareholders while reinforcing its operational excellence in the maritime transportation industry.