Slide 1: Shareholder letter on long-term incentive plans
In line with best practice, we believe that it is important to have a portion of our key managers’ compensation closely aligned to shareholder interests. Consistent with the 850,000 shares initially allocated to the 2008 Plans which have supported the equity compensation grants for the last three ye
Slide 2: Shareholder Communication: Long-Term Incentive Plans
Shareholder Communication Long-Term Incentive Plans
Slide 3: Purpose of Long-Term Incentive Plans (LTIPs)
2 Purpose of Long-Term Incentive Plans (LTIPs) Equity based compensation a vital component of executive compensation creates variable compensation defers part of reward to the medium and long-term Aligns executives’ interests with creation of shareholder value option grants create direct link to com
Slide 4: Innospec Share Option Plans
3 Innospec Share Option Plans Three Core Long-Term Incentive Plans Two for executives, including the CEO ; One specifically for Non-Employee Directors Plans initiated in 2008 850,000 shares allocated for use over a three- year period Request to augment the plans with 850,000 shares 3.6% of shares ou
Slide 5: Innospec Business Performance
4 Innospec Business Performance Development and execution of a highly successful strategy for our Fuel Specialties business Now one of the major global players in this market Turnaround of our Active Chemicals business creating good top line growth substantially improved margins excellent platform f
Slide 6: Innospec Financial Performance
2008 2010 Sales $641m $683m EBITDA $50.4m $91.5m Net Income $12.5m $73.7m Net Income (exc Special Items) $45.4m $82.4m EPS (diluted) $0.51 $2.97 Innospec Financial Performance Period covered by 2008 Share Option Plans
Slide 7: Innospec Share Price Performance
6 IOSP D-J/NASDAQ/S&P500 Innospec Share Price Performance
Slide 8: Performance-Related Share Option Plan (PRSOP)
7 Performance-Related Share Option Plan (PRSOP) Main plan, covers all senior executives, including the CEO Represents approx 75% of options granted to executives Entirely performance-related with vesting based on improvement in shareholder value Annual grants typically with exercise price of zero Ve
Slide 9: Company Share Option Plan (CSOP)
8 Company Share Option Plan (CSOP) Covers all senior executives, including the CEO Represents approx 25% of options granted to executives Annual grants typically with exercise price set at market price Vesting after three years Only deliver value to executives if the share price improves Hence share
Slide 10: Non-Executive Director Share Option Plan (NEDSOP)
9 Non-Executive Director Share Option Plan (NEDSOP) Non-employee Directors (NEDs) only Annual grants, typically with exercise price set at market price Initial grant with exercise price of zero once director elected by shareholders Market-priced Options approx $45,000 per annum for each NED Only del
Slide 11: Option Discipline
10 Option Discipline 2008 Plans Initial allocation of 850,000 shares, almost fully utilized Utilization rate of 1-1.5% of shares outstanding per annum as part of normal grant process 2009-2010 - several special retention grants due to change of management team and company circumstances No further sp
Slide 12: Summary
11 Summary Innospec seeks to augment the 2008 Share Option Plans 850,000 shares from the original plan almost fully utilized in the last three years Augmenting with the same amount of shares allows the plans to operate on the same level for around the next 3-4 years Outstanding Business Performance
Slide 13: Forward-Looking Statements
Forward-Looking Statements This presentation and the accompanying letter contain certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts included herein or in the accompanying letter, su