Finnair Oyj - Other information disclosed according to the rules of the Exchange

Finnair's Board of Directors decided on new periods to the employee share plan and incentive scheme for key personnel

Finnair Plc                  Stock Exchange Release                 20 December
2017 at 9.20 am. EET

Employee share plan

The Board of Directors of Finnair Plc has decided to launch a new 12-month
savings period under the Employee Share Savings Plan. The purpose of the plan
introduced in 2013 is to encourage the employees to become shareholders in the
company, to provide long-term rewards through potential share price appreciation
and thereby strengthen the employees’ interest in the development of Finnair’s
shareholder value.

Participation in the share savings plan is voluntary. The decided 12-month
savings period will commence on 1 July 2018. Potential future savings periods
are subject to separate Board decisions.

The eligible Finnair employees are offered the opportunity to invest part of
their base salary in Finnair shares through the plan. Finnair awards each
participant one Matching Share for each two purchased shares after a holding
period of approximately two years. The awarded shares are taxable income for the
recipient.

To increase the attractiveness of the plan, each employee participating in the
plan for the first time in this savings period will additionally be awarded 20
bonus shares in October 2018, provided that employee participates at least in
the first three months of the plan. The plan will be offered to approximately
5,000 Finnair employees in Finland. The maximum monthly savings are eight per
cent and the minimum are two per cent of each participant's gross base salary
during one month.

The total amount of all savings in 2018–2019 may not exceed 7.5 million euros,
which equals 0.58 million shares, using the 19 December 2017 closing share price
of 12.84 euros.

Shares will be purchased with the accumulated savings at the market price
quarterly, after the publication dates of the Finnair's interim results. Any
dividends paid on purchased shares during the commencing savings period will be
reinvested into additional shares on the following purchase date. These shares
will have equal rights to Matching Shares.

Performance-based incentive plan for key personnel

The Board of Directors of Finnair has approved a new individual performance
share plan covering the years 2018–2020. Within the plan, the participants have
the opportunity to earn Finnair shares as a long-term incentive reward, if the
performance targets set by the Board of Directors for the plan are achieved. The
purpose of the arrangement is to motivate the management to work for increasing
the shareholder value in the long-term and to commit the management to the
company.

The annually commencing performance share plans include a three-year performance
period. The potential share rewards will be delivered to the participants in one
tranche after the performance period and they are at the participants’ free
disposal after delivery. The potential share rewards will be delivered to the
participants in the spring 2021. The performance criteria applied to the plan
2018–2020 are earnings per share and revenue growth.

If the targets set for the plan for years 2018–2020 are fully achieved, the
maximum number of shares to be delivered based on this plan is approximately
370,000 shares. This number of shares represents a gross earning, from which the
payroll tax is deducted and the remaining net-value is delivered to the
participants in shares.

The members of Finnair’s Executive Board are expected to retain at least fifty
per cent of the net shares received based on the arrangement until their share
ownership in Finnair corresponds to at least their annual gross base salary.

The maximum combined value of all variable compensation paid to an individual
participant in any given year may not exceed hundred and twenty per cent of the
participant’s annual gross base salary.

The number of employees eligible to participate in the plan 2018–2020 is
approximately 70 persons.

The Board of Directors anticipates that no new shares will be issued in
connection with the share-based incentive plans and that therefore the
arrangement will have no dilutive effect on the registered number of the
company’s shares.
Further information:
Finnair communications, tel. +358 9 818 4020, comms(a)finnair.com

Distribution:
Nasdaq Helsinki
Principal media
Finnair is a network airline specialising in passenger and cargo traffic between
Asia and Europe. Helsinki’s geographical location gives Finnair a competitive
advantage, since the fastest connections between many European destinations and
Asian megacities fly over Finland. Finnair’s vision is to offer its passengers a
unique Nordic experience, and its mission is to offer the smoothest, fastest
connections in the northern hemisphere via Helsinki and the best network to the
world from its home markets. Finnair is the only Nordic carrier with a 4-star
Skytrax ranking and a member of the oneworld alliance. In 2016, Finnair’s
revenues amounted to EUR 2,317 million and it carried almost 11 million
passengers. Finnair Plc’s shares are quoted on Nasdaq Helsinki.