PATHEON N.V. Remuneration Policy

Transcription

1 PATHEON N.V. As provided for in article of the articles of association of Patheon N.V. (the Company ), the general meeting of the Company (the "General Meeting"), upon a proposal of the board (the "Board"), is authorized to adopt the remuneration policy of the Board. In its meeting of 3 June 2016, the General Meeting adopted the current remuneration policy for the Board (the Policy ). Within the framework of the Policy, compensation of the directors is determined by the Board, based on the advice of the Board s Compensation and Human Resources Committee (the Committee ) in accordance with the Committee s Charter (the Charter ). The Company may, from time to time, enter into service agreements or similar arrangements with its executive and non-executive directors, as it deems necessary or appropriate. I. GENERAL The purpose of the Policy is to define a competitive remuneration package, designed to attract, retain, and motivate appointees to the Board, who possess the necessary leadership qualities and the requisite skills and experience in the various facets of the Company s business. The Policy aims to ensure that directors interests are closely aligned to those of the Company s stakeholders, including the shareholders, and to incentivize the Company s directors to achieve short- and long-term performance goals with the objectives of substantially increasing the Company s equity value. This Policy is intended to ensure the overall market competitiveness of the Company s director remuneration practices while providing the Board with enough flexibility to tailor its remuneration practices on a case by case basis. 1 P a g e

2 II. EXECUTIVE DIRECTORS The remuneration package for any executive director shall be determined by the Board (by its non-executive directors without involvement of any executive director) in accordance with this Policy. The executive director remuneration package shall be reviewed periodically in accordance with the Charter and the Company's internal policies. Generally, it is expected that executive director remuneration will include a fixed base salary and a variable component comprised of short and long-term variable incentives. An executive director shall also receive certain perquisites, retirement benefits and health benefits, as well as compensation upon certain events, which may include a qualifying termination of employment or the change in control of the Company. Fixed Component: Base Salary The base salary of an executive director is set at a competitive level, taking into account the skills, competencies, experience, scope of position and performance of the executive director. An executive director s base salary shall be periodically reviewed and adjusted by the Board based on individual experience, performance and market practices. Variable remuneration An executive director may be granted variable compensation in the form of short-term and longterm incentives. The objective of the performance-related variable remuneration payment is to 2 P a g e

3 incentivize and reward strong short- and long-term financial and personal performance and the implementation of strategic imperatives. Variable remuneration shall be determined annually by the non-executive directors of the Board at or around the beginning of the Company's relevant financial year and in accordance with the Charter. Short-term incentive shall generally consist of an annual performance-based cash incentive bonus. The performance conditions include criteria reflecting the Company s financial performance and may also include quantitative or qualitative criteria related to the Company s non-financial performance and/or to individual performance. Long-term incentives shall be granted under the Company s then-current omnibus incentive plan (the Plan ), which shall set forth the appropriate terms and conditions under which the awards shall be granted. In determining the long-term incentive component of an executive director s compensation, the Committee and/or the Board shall consider factors as it determines relevant, which may include, for example, the Company s performance and relative shareholder return, the value of similar awards granted to executives of comparable companies, and the awards granted to the executive in previous years. III. NON-EXECUTIVE DIRECTORS The remuneration package for the non-executive directors shall be determined by the Board in accordance with this Policy and the Charter. Non-executive directors (other than those who are 3 P a g e

4 employed by JLL, DSM or their respective affiliates) shall be awarded annual fees, payable in cash or equity awards granted under the Plan. The Board shall determine whether non -executive directors may elect to receive their cash fees in the form of share-based awards (including share options, restricted stock units or restricted shares). Additional compensation may be awarded for non-executive directors serving in board committees and additional compensation may be awarded to non-executive directors serving as chairperson of a committee. Subject to the limitations set forth in the Plan, the non-executive directors may be eligible for grants of shares or share-based awards. The Plan shall set forth the appropriate terms and conditions under which these restricted share units shall be granted. Periodically, the fees and compensation arrangements in place for non-executive directors shall be reviewed by the Board and the Committee in accordance with the Charter to ensure that the arrangements are competitive, and based on such review, additional compensation may be granted where appropriate. IV. MAXIMUM NUMBER OF SHARES OR OPTIONS TO ACQUIRE SHARES TO BE GRANTED In accordance with the Plan, the maximum value of awards granted to a non-employee director of the Company under the Plan in any consecutive twelve month period shall be USD$450,000. This 4 P a g e

5 maximum value shall exclude the value of cash voluntarily deferred by a non-employee director in exchange for shares. Subject to the terms of the Plan, no individual may be granted awards during any calendar year for more than the number of shares reserved under the Plan, and no individual who is likely to be a Covered Employee (within the meaning of the Plan) may be granted a cash award under the Plan exceeding USD$5,000,000 during any calendar year. V. LOANS AND GUARANTEES No personal loans of the nature prohibited by Section 402 of the Sarbanes-Oxley Act of 2002 or other applicable law are offered to members of the Board. VI. CLAWBACK The 'claw-back' clause set forth in the Plan shall apply to all awards granted to the Company s members of the Board. 5 P a g e