Even announces new Long-Term Incentive Plan

Even announces new Long-Term Incentive Plan

São Paulo, September 16, 2013 - Even Construtora e Incorporadora S.A. - EVEN (BM&FBOVESPA: EVEN3), with operations in São Paulo, Rio de Janeiro, Rio Grande do Sul and Minas Gerais and focused on residential projects with unit value above R$250,000, announces that Even‘s new variable compensation program was approved at the last Board of Directors‘ Meeting held on August 19, 2013, and minutes were published on August 26.

The variable compensation programs aim at aligning employees‘ remuneration to their effective contribution to Even‘s results. Up to date, the Company only relied on a short-term variable compensation recurring program1. Now, we are launching a new program which will also create value in the long run. This is a retention plan, considering its two to four-year duration.

Long-Term Incentive Plan (LTIP)

Even‘s compensation structure now includes the Long-Term Incentive Plan. Main conditions are:

Eligible Employees: Even‘s statutory and non-statutory officers and managers are eligible to the program (on this date, 127 employees).

Eligibility Rules: Employees who achieve the minimum grade necessary in the annual potential individual evaluation will receive the LTIP. The final phase of this evaluation is the approval by the Company‘s Board of Executive Officers.

Periodicity: This benefit will be granted yearly, as of 2014.

Means of Payment: The LTIP does not provide cash payment. The incentive will be fully paid through EVEN3 stocks, including lock-up period.

Vesting period: Stocks will have two, three and four-year vesting period, but beneficiary will have all shareholders‘ rights (preemptive right, voting right, dividends, etc.) upon granting. The sole vesting condition is to maintain an employment relationship during entire period.

Dilution: The number of shares within the scope of LTIP is subject to the thresholds set forth in the Company‘s Stock Option Plan approved at the Extraordinary Shareholders‘ Meeting held on February 13, 2007, and shall be considered jointly with the stock options already granted by the Company, as per board of directors‘ meeting of March 28, 2011. For instance, if the LTIP share issue had occurred in current year, dilution would be 0.64%.

Compensation Structure

Now, Even has the following compensation structure:

  • Fixed Compensation
    Competitive, in line with the market practices.
  • Short-term variable compensation (bonus)
    Annual compensation based on the achievement of the company, area and individual targets. The payment of short-term bonus now is subject to the achievement of a minimum ROE, defined by the Board of Directors, with a progressive amount as of such level.
    Below this level, bonus will not be paid.
  • Long-term variable compensation (LTIP)
    Annual compensation based on the potential evidenced by each eligible employee. This is a long-term and also a retention plan, where employees have their interests aligned with shareholders‘ interests, reinforcing the ownership vision.
    The options already granted within the scope of the Company‘s Stock Option Plan shall remain valid, but at this moment, new stock options will not be granted.

Variable compensation breakdown (averaged by position level):

Short-Term
Variable
Long-Term
Variable
Statutory Officers 38% 62%
Non-staturory officers and managers 50% 50%

¹timely stock option plans were granted, and currently, granting is outstanding within the scope of the program of March 28, 2011

To access the PDF file, click here.

The Company will hold tomorrow a Conference Call and Webcast (with Simultaneous Translation into English) regarding the new Long-Term Incentive Plan:

Tuesday, September 17, 2013
9:00 a.m. (NY Time)
10:00 a.m. (Brasília Time)

Dial-in Phone Numbers
Parties in Brazil: +55 (11) 3728-5971 or (11) 3127-4971
Parties in other countries: +1 (516) 300-1066
Access Code: Even

Webcast Access, click here.