Checkit plc 

("Checkit" or the "Group")

Grant of options and PDMR dealings

Checkit plc (AIM: CKT) announces that, on 25 March 2022, it granted options over ordinary shares of 5 pence each ("Ordinary Shares") to Kit Kyte, Chief Executive Officer, under the Checkit plc 2020 Enterprise Management Incentive Plan (the "Plan").

This grant of options and the terms of the Plan, were determined by Checkit's Remuneration Committee following consultation with the Group's significant shareholders.

Under the terms of the Plan, Mr. Kyte has been granted nominal cost options over 1,500,000 Ordinary Shares. The options will vest over three separate periods in tranches of 500,000 options. The vesting date for the first tranche of options will be 10 business days after the publication of the Group's audited annual accounts for the financial year ending 31 January 2025 or, in the Board's absolute discretion, 10 business days after the publication of the Group's interim report for the financial year ending 31 January 2026. The vesting date for the second tranche shall follow the same pattern as the first tranche albeit for the financial year ending 31 January 2026 in relation to the audited annual accounts and 31 January 2027 for the interim report. The vesting date for the third tranche shall be the date 10 business days from the publication of the audited consolidated accounts for the Group for the financial year ending 31 January 2027.

Each tranche of options will be subject to performance criteria and shall only vest subject to a 'Rule of 40 Target' being met on the dates outlined above.  In addition, to be exercisable, the share price must be at or above a share price target of 130p (the "Share Price Target") on the date the options are exercised and the average share price must have been at or above this level during the 6 months prior to the exercise date.

The Rule of 40 Target will be calculated as follows:

ARR Growth % + L/EBITDA Margin %

·    The ARR Growth % is measured by calculating the percentage growth in Annual Recurring Revenue (ARR) compared with the previous year.

·    The L/EBITDA Margin % is measured in each year by calculating the earnings or losses of the Group as a percentage of its revenue, before interest, tax, depreciation and amortisation and before costs in relation to share incentive plans, but after deduction of all spending on NPD and cash based exceptional items as determined by the Board.

The Rule of 40 is used commonly in SaaS companies to measure performance by reference to both profits and growth.

The full number of options granted will not be exercisable until after a minimum vesting period has passed of over five years from the grant date. Subject to the Rule of 40 vesting requirements, the Share Price Target must be achieved within just over six years of grant in order for the options to become exercisable, enabling a full six years of Kit Kyte's performance as Chief Executive Officer to be measured.

In the event of a change of control event, the Rule of 40 Target will be determined by reference to the Group's latest annual or interim report and the Share Price Target will be met if the price paid by a person obtaining control of the Group exceeds 130 pence per Ordinary Share.

The notification below, made in accordance with the requirements of the UK Market Abuse Regulation, provides further detail.

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