Remuneration policy. (Remuneration of the Board of Directors and other levels of management) 13 April 2018, Annual General Meeting

Transcription

1 (Remuneration of the Board of Directors and other levels of management) Date of adoption: 13 April 2018, Annual General Meeting Applicable to: The listed parent, North Media A/S, and its subsidiaries The Remuneration policy has been prepared in Danish and English. The Danish text shall be the governing text for all purposes, and in case of any discrepancy the Danish wording shall be applicable.

2 Contents 1. BACKGROUND FOR REMUNERATION POLICY GENERAL PRINCIPLES BOARD OF DIRECTORS EXECUTIVE BOARD AND OTHER EXECUTIVES... 4 Page 2 of 5

3 1. Background for remuneration policy This policy shall contain the overall guidelines for remuneration and incentive schemes for Management of North Media A/S and its subsidiaries. The purpose is to lay down a remuneration framework for the Group and to determine specific guidelines for incentive pay. In accordance with Section 139 of the Danish Companies Act, the Board of Directors of North Media A/S shall be obliged to lay down overall guidelines for the Company s incentive pay to Management before any specific incentive pay agreements can be entered into. This remuneration policy has been prepared in accordance with the Danish Companies Act and is to be considered and adopted by the shareholders of North Media A/S in general meeting. This remuneration policy shall replace the guidelines adopted by the Annual General Meeting on 4 April In preparing this remuneration policy, the Board of Directors has considered the corporate governance recommendations as updated by the Committee on Corporate Governance in November General principles The overall principle of remuneration shall be that its level shall be competitive and comparable with similar companies. To ensure sustained development and growth of the Group, the appointment and retention of persons holding the right competencies are vital. The Board of Directors believes that a competitive fixed pay combined with both short-term and long-term incentive schemes are key elements in determining the individual remuneration components and their balance. As a rule, the short-term incentive scheme for the Executive Board and a selected group of executives shall consist of both a revenue-based bonus and a bonus based on earnings growth. The long-term incentive scheme shall consist of share options granted to members of the Board of Directors, of the Executive Board and a selected group of executives that are to contribute to ensuring agreement between the efforts of the Board of Directors, the Executive Board and the executives and the value created for the shareholders. This provides a good balance between incentives based on the Company s growth, earnings improvements and an increasing share price over a period of years. The Board of Directors considers the nature and amount of the remuneration components to be common, reasonable and appropriate in view of the Group s financial position. 3. Board of Directors The members of the Board of Directors shall receive the following types of remuneration: 1. A fixed annual fee 2. A fixed annual fee if the member participates in committee work Page 3 of 5

4 3. Reimbursement of any costs related to the participation in Board work 4. Share options. The fixed annual fee of the Chairman of the Board of Directors shall be approximately 2.5 times an ordinary Board member s fee. For the Chairman of the Board of Directors, the number of any share options granted at the grant date shall be no more than 100% of the number of shares granted to the Company s Chief Executive Officer and no more than 50% for the other members of the Board of Directors. The exercise price of the share options shall be determined on the basis of the average price of the Company s shares for a period up until the grant date. As a rule, the exercise period of the share options may begin 24 months after the grant date at the earliest. Efforts shall be made to set up multiple-tranche share option programmes under which the exercise period of the share options may on average begin 36 months after the grant date at the earliest. The exercise period of the share options may be up to 12 months. It shall be a condition for exercising the share options that the relevant member of the Board of Directors is still a member of the Board of Directors of North Media A/S at the exercise date. Non-exercised share options shall expire. The share options may be funded by way of the Company s holding of treasury shares. The Board of Directors shall have no other incentive pay. The total remuneration paid to the Board of Directors and the theoretical market value of share options granted are evident from the Group s Annual Report. 4. Executive Board and other executives Remuneration of the Executive Board and other executives shall be composed of the following components: 1. A fixed annual salary, pension, company car, telephone, etc. 2. A variable annual performance-based bonus 3. Share options or other type of long-term share-based incentive pay. The Board of Directors shall annually assess and determine the remuneration for the members of the Executive Board. The Board of Directors may grant members of the Executive Board and other executives a performance-based bonus enabling the individual to obtain an annual fee. As a rule, such bonus shall be based on one or more of the following elements: a share of operating profit (EBIT) and/or a share of changes in revenue and operating profit (EBIT) compared with the previous year. To ensure focus on long-term and stable value creation, bonus is weighted 50% of previous years' profits and 100% of the current year profit. Furthermore, the bonus programmes shall usually cover a three-year period. Page 4 of 5

5 The basis for calculating bonus and the amount of bonus will vary both among the individual members of the Executive Board and among the other executives, however, for each member it cannot exceed an amount equivalent to 100% of the fixed annual salary in 2018 and from 1 January 2019 no more than 50%. The Board of Directors may grant an individually variable number of share options or other type of long-term share-based incentive pay to members of the Executive Board and other executives. If, during any given financial year, the Board of Directors decides to grant share options, the calculated theoretical market value of the share options granted at the grant date cannot represent more than 50% of the individual employee s fixed annual salary. The value shall be calculated applying the Black & Scholes model. The exercise price of the share options shall be determined on the basis of the average price of the Company s shares for a period up until the grant date. As a rule, the exercise period of the share options may begin 24 months after the grant date at the earliest. Efforts shall be made to set up multiple-tranche share option programmes under which the exercise period of the share options may on average begin 36 months after the grant date at the earliest. The exercise period of the share options may be up to 12 months. Employment with the Group at the exercise date shall be a precondition for exercising the share options. The share options may be funded by way of the Company s holding of treasury shares. The maximum notice period for members of North Media A/S Executive Board shall be 12 months plus a 12-month termination benefit. For other executives, the maximum notice period shall be nine months plus a three-month termination benefit. The total remuneration paid to the Executive Board and the other executives and the theoretical market value of share options granted are evident from the Group s Annual Report. Page 5 of 5