The Group has several equity incentive plans under which a combination of performance share units (“PSUs”) and retention restricted share units (“RSUs”), which each represent the right to receive one Ferrari common share, have been awarded to the Executive Chairman, the Chief Executive Officer (“CEO”), members of the Ferrari Leadership Team (hereinafter also the “FLT”) and other key employees of the Group.

In the first quarter of 2023, 36,090 2020-2022 PSU awards vested (representing 95 percent of the target PSU awards) as a result of the achievement of the related performance conditions and 32,339 2020-2022 RSU awards vested upon achievement of the related service conditions. As a result, 68,429 common shares, which were previously held in treasury, were assigned to participants of the plan in the first quarter of 2023. There are no further awards outstanding for the Equity Incentive Plan 2020-2022.

Under the Equity Incentive Plan 2021-2023 approved in 2021, the Company awarded approximately 50 thousand 2021-2023 PSUs and approximately 41 thousand 2021-2023 RSUs to the Executive Chairman, members of the FLT and other key employees of the Group. These PSUs and RSUs cover the three-year performance and service periods from 2021 to 2023.

(i)TSR Target - 50 percent of the awards vest based on the achievement of the TSR ranking of Ferrari compared to an industry specific Peer Group of eight;

(ii)EBITDA Target - 30 percent of the awards vest based on the achievement of an EBITDA target determined by comparing Adjusted EBITDA to the Adjusted EBITDA targets derived from the Group’s business plan;

(iii)Innovation Target - 20 percent of the awards vest based on the achievement of defined objectives for technological innovation and the development of the new model pipeline over the performance period.

Each target is settled independently of the other targets. The awards vest in 2024 and the total number of shares assigned upon vesting depends on the level of achievement of the targets.

In March 2024, 41,338 2021-2023 PSU awards are expected to vest (representing approximately 122 percent of the target PSU awards) as a result of the achievement of the related performance conditions (described above) and an equal number of common shares held in treasury will be assigned to participants of the plan, following which there will be no further 2021-2023 PSU awards outstanding.

In March 2024, 29,550 2021-2023 RSU awards are expected to vest as a result of the achievement of the related service condition, which is the recipient’s continued employment with the Company at the time of vesting, and an equal number of common shares held in treasury will be assigned to participants of the plan, following which there will be no further 2021-2023 RSU awards outstanding.

Under the Equity Incentive Plan 2022-2024 approved in 2022, the Company awarded approximately 72 thousand 2022-2024 PSUs to the Executive Chairman, the CEO, the remaining members of the FLT and other employees of the Group, and approximately 26 thousand 2022-2024 RSUs to members of the FLT and other employees of the Group. These PSUs and RSUs cover the three-year performance and service periods from 2022 to 2024.

(i)TSR Target - 40 percent of the awards vest based on the achievement of the TSR ranking of Ferrari compared to an industry specific Peer Group of eleven;

(ii)EBITDA Target - 40 percent of the awards vest based on the achievement of an EBITDA target determined by comparing Adjusted EBITDA to the Adjusted EBITDA targets derived from the Group’s business plan;

(iii)ESG Target - 20 percent of the awards vest based on the achievement of defined objectives relating to environmental and social factors. In particular, 50 percent of the ESG Target is based on the reduction of CO2 carbon emissions and 50 percent is based on the maintenance of the equal salary certification.

Each target is settled independently of the other targets. The awards vest in 2025 and the total number of shares assigned upon vesting depends on the level of achievement of the targets.

Under the Equity Incentive Plan 2023-2025 approved in 2023, the Company awarded approximately 58 thousand 2023-2025 PSUs to the Executive Chairman, the CEO, the remaining members of the FLT and other employees of the Group, and approximately 22 thousand 2023-2025 RSUs to members of the FLT and other employees of the Group. These PSUs and RSUs cover the three-year performance and service periods from 2023 to 2025.

(i)TSR Target - 40 percent of the awards vest based on the achievement of the TSR ranking of Ferrari compared to an industry specific Peer Group of eleven;

Each target is settled independently of the other targets. The awards vest in 2026 and the total number of shares assigned upon vesting depends on the level of achievement of the targets.

The number of 2023-2025 PSUs with a TSR Target that vest under the Equity Incentive Plan 2023-2025 is based on the Company’s TSR performance over the relevant performance period compared to an industry-specific peer group as summarized below.

The number of 2023-2025 PSUs with an EBITDA Target that vest under the Equity Incentive Plan 2023-2025 is determined by comparing Adjusted EBITDA to the Adjusted EBITDA targets derived from the Group’s business plan, as summarized below.


Actual Adjusted EBITDA Compared to Business Plan			% of Awards that Vest
+15%			175%
+10%			150%
+5%			125%
Business Plan Target			100%
-5%			75%
<-5%			0%

The fair value of the PSUs and RSUs that were awarded under the Equity Incentive Plan 2023-2025, which is determined based on actuarial calculations that apply certain assumptions and take into consideration the specific characteristics of the awards granted, is summarized in the following table.

The fair value of the 2023-2025 PSU awards was measured at the grant date using a Monte Carlo Simulation model. The fair value of the 2023-2025 RSU awards was measured using the share price at the grant date adjusted for the present value of future distributions which the recipients will not receive during the vesting period.

The key assumptions utilized to calculate the grant-date fair values of the PSUs that were awarded under the Equity Incentive Plan 2023-2025 are summarized below:

The expected volatility was based on the observed volatility of the defined peer group. The risk-free rate was based on the iBoxx sovereign Eurozone yield.

In November 2023 the Company announced that it would launch a broad-based employee share ownership plan in the early months of 2024 under which each employee will be given the option to become a shareholder of the Company, receiving a one-off grant of shares worth up to a maximum of approximately €2 thousand. If the employee holds the shares for at least 36 months, the Company will grant them an additional tranche of shares worth up to 15 percent of the value of the first allocation.

During 2022, the Company awarded 15,271 share awards, which each represent the right to receive one Ferrari common share, to certain employees, of which 6,643 share awards vested immediately at the grant date. In 2023 6,838 share awards vested and 1,309 share awards were forfeited. At December 31, 2023, 481 share awards remained outstanding and will vest in 2024, subject to the recipient’s continued employment with the Company at the time of vesting. The fair value of the awards was equal to €203 per award, measured using the share price at the grant date adjusted for the present value of future distributions which the recipients will not receive during the vesting period.


	PSU Awards	RSU Awards	Other Awards	Total Outstanding Awards
Balance at December 31, 2021	152,172	123,661	—	275,833
Granted	72,373	26,574	64,048	162,995
Forfeited	(16,327)	(8,934)	—	(25,261)
Vested	(68,013)	(54,112)	(6,643)	(128,768)
Balance at December 31, 2022	140,205	87,189	57,405	284,799
Granted	58,381	21,939	63,217	143,537
Forfeited	(8,117)	(3,544)	(1,309)	(12,970)
Vested	(36,090)	(32,339)	(55,614)	(124,043)
Balance at December 31, 2023	154,379	73,245	63,699	291,323

The following table presents the share based compensation expense recognized for the years ended December 31, 2023, 2022 and 2021, as well as the unrecognized share-based compensation at December 31, 2023, 2022 and 2021.


	For the years ended December 31,
	2023	2022	2021
	(€ thousand)
Equity incentive plans and other share-based awards	15,154	16,172	11,689
Broad-based employee share ownership plan	10,222	—	—
Commercial agreements with suppliers	4,563	4,688	2,206
Total share-based compensation expense	29,939	20,860	13,895

	At December 31,
	2023	2022	2021
	(€ thousand)
Unrecognized share-based compensation expense	12,954	16,069	11,082