Remuneration to Group Management
At the AGM 2021 it was resolved to adopt guidelines for remuneration to senior executives. The guidelines shall apply to remuneration of the CEO, other members of the Group Management and, where applicable, remuneration of Board members in addition to Board fees. The guidelines do not apply to remuneration decided or approved by the General Meeting.
Remuneration sahll be competitive and in line with market practice and may consist of a fixed salary, short-term variable remuneration, other benefits and pension. The total remunderation package may also include long-term variable remunderation. Long-term variable remuneration is decided by the General Meeting and is therefore not covered by the guidelines.
The fixed salary shall consist of a fixed annual cash salary. The fixed salary shall be in line with the market and deterined taking into account responsibility, expertise and performance. The fixed salary is reviewed every year.
Short-term variable remuneration
In addition to fixed salary, Arla Plast shall be able to offer short-term variable remuneration. The short-term variable remuneration shall be linked to predetermined and measurable criteria that can be financial or non-financial. They may also be individualized quantitative or qualitative targets. The criteria shall be designed to promote the Company´s business strategy, long-term interests and sustainability. For the CEO, short-term variable remuneration, if any, may not exceed 40 percent of the fixed annual salary in any one financial year. For other members of Group Managment, short-term variable remuneration in any one financial year may not exceed 30 percent of the fixed annual salary.
Pension benefits, including sickness/disability insurance, shall be classified as either defined benefit or defined contribution and may not exceed 30 percent ot the fixed annual salary.
Other benefits may include health insurance, car benefit, housing benefit and fitness susidy. Where such benefits are offered, they must be in line with market practice and only constitute a limited portion of total remuneration. Premiums and other costs related to such benefits may not amount to a total of more than 20 percent of the fixed annual salary.
Period of notice and severance pay
For the CEO, if notice of termination is served by the Company, the maximum period is twelve months. For notice of termination seved by the CEO, the maximum noticde period is six months, without right to severance pay. The notice period for other senior executives is six months if the employment is terminated by the Company and four months if the employment is terminated by the employee.
Fixed salary during the notice periods and severance paymentm including payments for any restrictions on competition, shall in aggregate not exceed an amount equivalent to the fixed remuneration for two years.
Consultant fee to Board members
If a member of the Board (including through a wholly-owned subsidiary) should carry out services for Arla Plast in addition to Board work, specific fees for this can be paid, provided that such services contribute to the implementation of Arla Plast´s business strategy and the safeguarding of Arla Plast´s long-term interests, including its sustainability. The annual consultancy fee for each Board member may not exceed the annual Board fee. The fee shall be in line with market practice.
Derogation from the guidelines
The Board of Directors may resolve to derogate from the guidelines, in whole or in part, if in a specific case there is special cause for the derogation and a derogation is necessary to serve the long-term interests of Arla Plast, including its sustainability, or to ensure the financial viability of Arla Plast.
Remuneration to Group Managment in 2020
|TSEK||Base salary||Variable remuneration||Pension||Other benefits||Total|
|Henrik Håkansson, Group CEO||2,100||846||837||-||3,783|
|Other senior executives (five people)||5,417||460||597||-||6,474|
|Senior executives in total||7,517||1,306||1,434||-||10,257|
Current emplyment terms for the CEO and Group Managment
The CEO has a fixed salary of approx Den verkställande direktören har en fast månadslön om cirka 196 TSEK. Provided that certain financial targets set in advance by the Board are achieved, the CEO may also receive an annual bonus. The bonus for 2021 may be a maximum of 940 TSEK. For the CEO, a notice period of sixx months appliew in case of termination by the CEO and twelve months in case of termination by the Company.
For the other senior executives, a notice period of four months applies in case of termination by teh senior executive and six months in case of termination by the Company.
The other senior executives have the opportunity to receive an annual bonus, provided that certain targets are met.
Share-related incentive plan
At an EGM on August 13, 2020 it was resolved to introduce an incentive plan, through which 980,000 warrants of series 2020/2023 were issued to ten key personnel in the Group. The reason for the incentive plan is that a personal incentive through ownership in the Company is expecteed to lead to increased motivation and a sense of belonging to the Company, as well as to increased interest in the business and its performance. Each (1) warrant entitles the holder to subscribe for one (1) share in the Company at a price of SEK 22.90 per share (plus an annual interest rate of 9.14 percent (calculated from September 1, 2020 until September 1, 2023, based on the actual number of days during the period divided by the actual number of days per year (accumulated daily and capitalized annually at the end of the last calender day of each year, for the firs time on December 31, 2020)). Assuming full exercise of the warrant, share capital may increase by a maximum of SEK 117,600 through the issuance of 980,000 shares, corresponding to a dilution of 4.67 percent. Subscription of new shares based on the warrants shall take place during the period commencing on August 1, 2023 up to and including September 1, 2023. In the event of special corporate events, such as a share transfer corresponding to more than 50 percent of votes in the Company (not including the Offering), or a transfer of assets, whereby all or substantially all of the assets of the Company or the Group are sold, new subscriptions for shares under the warrants may be made in connection with such corporate events. Otherwise, the terms and conditions of the warrants stipulate that they are subject to customary recalculation provisions.