Corporate Executive Board
The Corporate Executive Board supports the CEO in his tasks. The CEO acts as the Chairman to the Corporate Executive Board. The Corporate Executive Board supports the CEO in operative management and implementation and follow-up in the CEO's competence area. The Corporate Executive Board convenes once a month.
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Reward System of the Management
The Board of Directors decides upon the CEO's remuneration. Remuneration of the other management is decided on one-over-one basis.
Remuneration of the management consists of fixed monthly salary with fringe benefits (i.e. the aggregate salary) and currently also of bi-annual merit pay. In addition, the Company has an option programs.
Bi-annual Merit Pay System
Payment of merit pay is based on achievement of targets. The period when the merit pay is earned is six months. The criteria for bi-annual merit pay are the financial and strategic targets of the Company. In addition, part of the targets may be other objectives of the Company or business segment or personal targets. Personal targets vary between duties.
The maximum amount of merit pay for the CEO is 50% of the aggregate salary of the respective period and for the other management 30 – 50% of the aggregate salary of the respective period.
Long Term Reward System
Option Rights 2005
The Annual General Meeting of the year 2005 decided upon issuance of option rights for the management of Elektrobit Group and for its fully owned subsidiary. 4,500,000 option rights were divided into option rights 2005A, 2005B, 2005C and 2005D. Option rights 2005A were granted on the condition that recipients of the option rights shall purchase the amount, determined by the Board of Directors, of Elektrobit Plc's shares. Option Rights 2005 B, 2005C and 2005D included conditions based on financial targets of the Group. The option program included also a program on shareholding that obligated the management to use part of the revenue of the stock options for acquisition of shares of the Company, as determined by the Board of Directors in connection with its decision to issue stock options. In addition and according to the terms of the option program, the subscription price of the shares to be subscribed on the basis of option rights 2005B, 2005C and 2005D shall always be at least the subscription price of shares subscribed on the basis of option rights 2005A. Option rights entitle to subscribe shares as follows: 2005A between 1 April 2008 and 30 April 2010, 2005B between 1 April 2009 and 30 April 2011, 2005C between 1 April 2010 ands 30 April 2012 and 2005D between 1 April 2011 and 30 April 2013. Up-to-date information regarding option rights of the CEO and management can be found from the insider register maintained.
Option Rights 2006
The Annual General Meeting of the year 2006 decided upon issuance of 1,750,000 option rights for the chairman of the board and CEO to be elected after the said Annual General Meeting. These option rights were marked as 2006A. The chairman of the board was granted with 750,000 option rights free of charge and the CEO with 1,000,000 option rights free of charge. Option rights were granted on the condition that the chairman of the board has purchased 75,000 shares of the Company either directly or through company under its control, and the CEO has purchased 100,000 shares of the Company either directly or through company under its control prior to receiving the option rights. The subscription period of the shares to be subscribed on the basis of option rights 2006A, is between 1 May 2009 and 31 May 2012.
Option Rights 2008
The Annual General Meeting of the year 2008 decided upon issuance of option rights for the key persons of Elektrobit Group. The total aggregate amount of the option rights is 4,200,000, at most. 1,400,000 of the said option rights are marked as 2008A, another 1,400,000 option rights as 2008B and rest 1,400,000 option rights as 2008C.The subscription price of the shares to be subscribed on the basis of above mentioned option rights is based on the prevailing market price of the share of Elektrobit Group in NASDAQ OMX Helsinki Ltd at January 2009, January 2010 and January 2011. Subscription periods of the shares to be subscribed on the basis of above mentioned option rights are following: 2008A between 1 April 2012 and 31 March 2014, 2008B between 1 April 2013 and 31 March 2015 and 2008C between 1 April 2014 and 31 March 2016.