RUBIS - 2019 Universal Registration Document

8 FINANCIAL STATEMENTS - 2019 Consolidated financial statements and notes

4.9 STOCK OPTIONS AND FREE SHARES

ACCOUNTING POLICIES IFRS 2 provides for payroll expenses to be recognized for services remunerated by benefits granted to employees in the form of share-based payments. These services are carried at fair value of the instruments awarded. All the plans granted by the Group are in the form of instruments settled in shares; the payroll expense is offset in shareholders’ equity. Stock option plans Stock option plans are granted to some members of the Rubis Group personnel. These options are measured at fair value on the grant date, using a binomial model (Cox Ross Rubinstein). This model takes into account the characteristics of the plan (exercise price and exercise period) and market data on the grant date (risk-free interest rate, share price, volatility, and expected dividends). This fair value on the grant date is recognized as payroll expenses, on a straight-line basis over the vesting period, offset against shareholders’ equity. Free share awards Free share plans are granted to some members of the Rubis Group personnel. These free share awards are valued at fair value on the grant date, using a binomial model. The valuation is based, in particular, on the share price on the grant date, taking into account the absence of dividends during the vesting period. This fair value on the grant date is recognized as payroll expenses, on a straight-line basis over the vesting period, offset against shareholders’ equity. Preferred share awards Preferred share plans are also granted to some members of the Rubis Group personnel. These preferred share awards are valued at fair value on the grant date, using a binomial model. The valuation is based, in particular, on the share price on the grant date, taking into account the vesting period, the absence of dividends and conditions relating to the Average Annual Overall Rate of Return (AAORR) of the Rubis share. This fair value on the grant date is recognized as payroll expenses, on a straight-line basis over the vesting period, offset against shareholders’ equity. Company savings plans (PEE) The Group has set up several company savings plans for its employees. These plans provide employees with the possibility of subscribing to a reserved capital increase at a discounted share price. The plans comply with the conditions of application of share purchase plans (French National Accounting Council statement dated December 21, 2004). The fair value of each share is then estimated as corresponding to the variance between the share price on the plan grant date and the subscription price. The share price is nonetheless adjusted to take into account the unavailability of the share for 5 years, based on the variance between the risk-free rate on the grant date and the interest rate of an ordinary 5-year consumer loan. In the absence of vesting period, the payroll expense is recognized directly against shareholders’ equity. The expense corresponding to the Company contribution granted to employees is also recognized in the income statement under payroll expenses.

A €5,382 thousand expense for stock options, free shares and company savings plans was recognized under “Payroll expenses” in 2019.

Outstanding as of 12/31/2019

STOCK OPTIONS Date of the Board of Management meeting

Outstanding as of 12/31/2018 Rights issued

Rights exercised

Rights canceled

December 17, 2019

150,276

150,276 150,276

TOTAL

STOCK OPTIONS Date of the Board of Management meeting

Number of options outstanding

Expiry of exercise period

Exercise price (in euros)

Options exercisable

December 17, 2019

150,276 150,276

12/16/2022

52.04

TOTAL

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