Remuneration of the Executive Management Team

Remuneration System for the President and CEO and the Company’s Other Executive Management

Efore Plc’s Board of Directors approves contract terms of the CEO and the executive management of the company. Efore Plc’s Board of Directors decides the performance-related pay system for the CEO and the executive management of the company yearly. The total remuneration comprises short term yearly performance related compensation and a long-term share ownership plan as well as option scheme.

Short-term remuneration

The maximum performance-related compensation approved by the Board for the executive management team at max. 40% of the yearly earnings. The criteria used for assessing the performance are the Group’s EBIT-target and cash flow  (importance 80%) and those applying to the person’s own sphere of responsibility, and other measures of operational activity (importance 30%). Performance related compensation is monitored yearly.

Long-term remuneration

The Board of Directors of Efore Plc resolved on March 30, 2016 to issue stock options to the key employees of Efore Plc, based on the authorization received from the Annual General Meeting on March 30, 2016. The Board of Directors shall determine later the key employees. In accordance with the attached terms of the Stock Option Plan 1/2016, the stock options will be marked with symbol "1/2016" and the maximum number of stock options to be issued in 2016 shall be 1,500,000. The stock options shall be given free of
charge.

The Company will grant a maximum of 1,500,000 stock options, entitling to the subscription for a maximum of 1,500,000 new shares in the Company. One (1) stock option entitles its holder to subscribe one (1) new share in the Company. The stock options shall be subscribed on December 31, 2016, at the latest.

The Board of Directors of Efore Plc decided to launch a  share-based incentive plan for Roal Electronics S.p.A (Roal) key directors on July 11, 2013. Roal key directors joined the Efore Group in connection with the acquisition of Roal. The aim of the Plan is to combine the objectives of the shareholders and Roal key directors in order to increase the value of the Company, to commit Roal key directors to the Company, and to offer them a competitive reward plan based on holding the Company shares.

More information about long-term remuneration 

President and CEO’s service contract

Jorma Wiitakorpi's  service contract as from December 1, 2016

The Board of Directors of Efore Plc and the company’s CEO, Mr. Jorma Wiitakorpi, have agreed that Mr. Wiitakorpi will continue as Efore Plc’s CEO by a contract remaining in force until further notice. Originally Mr. Wiitakorpi’s service contract, commenced on 29 April 2016, was agreed to remain in force for a specific term ending on 28 April 2017. Mr. Wiitakorpi’s service contract will remain in force until further notice as of 1 December 2016.

President and CEO’s salary consists of a fixed monthly salary and a performance bonus. The President and CEO’s fixed monthly salary is 20.000 EUR as from December 1, 2016. and his fixed monthly salary is 23.000 EUR as from January 1, 2018. Furthermore, the CEO can be paid a performance bonus and the maximum sum is  equal to CEO’s six months  fixed salary. Furthermore, the CEO has a mobile phone benefit. He has not been paid a signing fee.

Mr. Wiitakorpi’s service contract terminates without notice when Mr. Wiitakorpi reaches the statutory retirement age.

Jorma Wiitakorpi's temporary service contract (from April 29 until November 29, 2016)

The salary, benefits and other terms of service of the President and CEO were defined in a written service contract approved by the Board. Jorma Wiitakorpi's  CEO agreement was  in force for a specific term and valid from April 29, 2016 until November 29, 2016. Despite of the fixed term contract both party was entitled to terminate the contract without specific reason with 3 months notice without receiving any separate discharge fee. The company had the right to terminate the CEO contract immediately according to the ordinary grounds of cancellation.

President and CEO’s salary consisted of a fixed monthly salary and a performance bonus. The President and CEO’s fixed salary was a total of 93.000 EUR. The performance bonus was depending on achieving the preagreed targets.   During the specific term the total amount of a performance bonus was 150.000 EUR. Furthermore, the CEO had a mobile phone benefit. He has not been paid a signing fee.

Remuneration of President and CEO and other members of the Management group in 2015

During the fiscal year 2015 President and CEO Heikki Viika (June 1, - Dec. 31, 2015)  received a total of EUR 149.000 in salary and fringe benefits out of which regular monetary salary accounted for EUR 148.000 and the fringe benefits for EUR 1.000.

Efore does not operate an incentive system under which fees are paid to the President and CEO in the form of the company’s own shares.

Heikki Viika's predecessor Vesa Vähämöttönen (Jan 1, - Feb. 28, 2015)  received a total of EUR 63.000 in salary and fringe benefits out of which regular monetary salary accounted for EUR 63.000 and the fringe benefits for EUR 0. Riitta Järnstedt ( Interim CEO of Efore Plc during March 1 - May 31, 2015) received a total of EUR 60.000 in salary and fringe benefits out of which regular monetary salary accounted for EUR 57.000 and the fringe benefits for EUR 3.000.

In 2015, salaries and fringe benefits for other management totaled EUR 890.000.