At the Annual General Meeting 2021 it was decided, according to the proposal made by the Nomination Committee, that the remuneration for the board would be EUR 90,000 to the Chair and EUR 40,000 to each of the other directors of the Board.
In addition to the Board remuneration, it was decided, that the following remuneration for committee work would be awarded; Audit Committee Chair EUR 12,500 and Members of Audit Committee EUR 6,250; Remuneration Committee Chair EUR 6,250 and Remuneration Committee Member EUR 3,125; Tech Committee Chair: EUR 6,250; and Tech Committee member: EUR 3,125.
Guidelines for remuneration to senior management
The Board of Directors proposes that the Meeting adopts the following guidelines for compensation of senior executives, which includes the CEO and other members of senior management, and the directors of the Board.
These Guidelines shall apply until the 2025 Annual General Meeting (provided that (a) new Guidelines may be approved in the interim by the shareholders at a general meeting and (b) they may continue to apply after 2025 if the shareholders do not approve new Guidelines that are proposed by the Board before or at the 2025 Annual General Meeting). These guidelines are forward-looking (i.e., it is applicable to the remuneration agreed, and amendments to remuneration already agreed, after adoption of these guidelines by the Meeting) and will replace the remuneration guidelines which were approved at the 2020 Annual General Meeting (the "2020 Guidelines") in their entirety. Please refer to the last section of this Agenda Item for a description of the changes which these proposed guidelines purport to make to the 2020 Guidelines.
Promotion of the company’s business strategy, long-term interests, and sustainability
In short, the company’s business strategy is the following.
Catena Media aims to be the number-one choice within global, innovative, performance based online marketing, in any business we enter. We will build outstanding relationships and always ensure partner brand growth by providing high-quality, partner-integrated products with superior user experiences. By focusing on strong brands within iGaming and Financial Services our goal is to become a global business with local presence on all continents. For more information regarding the company’s business strategy, please see www.catenamedia.com.
A prerequisite for the successful implementation of the company’s business strategy and safeguarding of its long-term interests, including its sustainability, is that the company is able to recruit and retain qualified personnel. To this end, it is necessary that the company offers competitive remuneration. This policy enables the company to offer the senior executives a competitive total remuneration.
Long-term share-related incentive plans have been implemented in the company and the company intends to continue to implement appropriate long-term share-related incentive plans in the future, including both share option programmes and warrant programmes in order to, inter alia, achieve an increased alignment between the interests of the participants in the programmes and the shareholders of Catena Media, as well as to create conditions for retaining and recruiting competent personnel. All long-term share-related incentive plans shall be proposed by the board of directors and submitted to the Annual General Meeting for approval. For more information regarding the implemented share-related incentive plans, including the criteria which the outcome depends on, please see, www.catenamedia.com/corporate-governance/incentive-programmes.
Variable remuneration covered by this policy is also intended to promote the company’s business strategy and longterm interests, including its sustainability.
Types of remuneration
Catena Media shall offer compensation that is in line with market terms and based on factors such as the importance of the work duties and the executive’s competence, experience and performance and may consist of the following components: fixed base salary, short-term variable remuneration, pension benefits and other benefits. Additionally, the general meeting may separately resolve on, among other things, share-related remuneration, which may include both fixed and variable elements.
Fixed base salary
Fixed base salary constitutes compensation for a committed work contribution at a high professional level that ultimately aims to create added value for Catena’s customers, shareholders, and employees. Fixed base salary shall be attractive in comparison with the market and be based on the executive’s competence, experience, and performance. Salaries are reviewed yearly. Senior executives do not receive remuneration for board assignments in the Catena Group’s subsidiaries and associated companies.
The satisfaction of criteria for awarding variable remuneration shall be measured over a period of one year. The variable remuneration may amount to not more than 100 per cent, for the CEO, and 50 per cent, for other senior executives, of the annual fixed base salary. Further variable remuneration may be awarded in extraordinary circumstances, provided that such extraordinary arrangements are limited in time and only made on an individual basis, either for the purpose of recruiting or retaining executives, or as remuneration for extraordinary performance beyond the individual’s ordinary tasks. Such remuneration may not exceed an amount corresponding to 200 per cent of the annual fixed base salary and may not be paid more than once each year per individual. Any resolution on such remuneration shall be made by the board of directors based on a proposal from the remuneration committee.
Criteria for awarding variable remuneration
The variable remuneration shall be linked to predetermined and measurable criteria which can be financial or nonfinancial, to be determined by the Remuneration Committee from time to time. The Remuneration Committee will also determine whether such variable remuneration will be subject to any deferral periods and whether the Company have the right to reclaim any such remuneration. They shall be individualized and may be quantitative or qualitative objectives. The criteria shall be designed so as to contribute to the company’s business strategy and long-term interests, including sustainability, by for example being clearly linked to the business strategy or promote the senior Press release – Catena Media plc 7 executive’s long-term development. In case earnings before taxes of the company are negative, any variable remuneration shall not be paid out.
To which extent the criteria for awarding variable remuneration has been satisfied shall be evaluated/determined when the measurement period has ended. The remuneration committee is responsible for the evaluation. For financial objectives, the evaluation shall be based on the latest financial information made public by the company.
In the event any variable remuneration has been paid out on the basis of information which later proves to be manifestly misstated, the company shall be assured possibility to reclaim such remuneration.
Senior executives (including the CEO, and the deputy CEO if any) may also be entitled to share-based remuneration according to the terms of share-based incentive programmes that may be approved by the shareholders in general meeting from time to time. The terms of these incentive programmes shall at least include: (a) clear, comprehensive, and varied criteria for the award of share-related remuneration; (b) the financial and non-financial performance criteria for awarding share-related remuneration; (c) the methods to be applied to determine to which extent the performance criteria have been fulfilled; and (d) information on any deferral periods and on the possibility for the company to reclaim any such remuneration. Although the terms of such incentive programmes may vary from one programme to another, (i) the vesting period for the CEO's (and deputy CEO's, if any) share-related remuneration shall never be less than two years nor more than four years and (ii) such share-related remuneration may not, at the time of initial allocation of such awards/rights, amount to more than 150 per cent of the CEO's (and deputy CEO's, if any) fixed annual cash salary, with the value of any share-based remuneration to be calculated according to the Black & Scholes valuation model. The purpose of share -related remuneration (through incentive programmes approved by the shareholders) is to achieve an increased alignment between the interests of senior executives and the company's shareholders, as well as to create conditions for retaining and recruiting competent personnel, which in turn contribute to the company’s business strategy and securing of its long-term interests and sustainability.
In this regard, the board of directors has submitted a new long-term share-related incentive plan proposal for senior executives to the Annual General Meeting 2021 for approval, with a three-year vesting period, the full details of which can be found at https://www.catenamedia.com/corporate-governance/general-meeting/annual-general-meetings/2021-agm/
For the CEO and other senior executives, pension benefits, as applicable, including health insurance (Sw: sjukförsäkring), shall be premium defined unless the individual concerned is subject to defined benefit pension under mandatory collective agreement provisions. Variable remuneration shall not qualify for pension benefits unless required by mandatory collective agreement provisions. The pension premiums for premium defined pension shall not amount to more than 25 per cent of the annual fixed base salary.
Other benefits may include, for example, life insurance, medical insurance (Sw: sjukvårdsförsäkring) housing allowance, school fees, travel cost compensation and company cars. Such benefits may amount to not more than 30 per cent of the annual fixed base salary.
Pension benefits and other benefits may be duly adjusted for compliance with mandatory rules or established local practice depending on which law the employment is governed by, taking into account, to the extent possible, the overall purpose of this policy.
Remuneration to the members of the Board of Directors
Remuneration for the board of directors shall be resolved upon by the general meeting. Board members shall only be entitled to a fixed base salary and shall be able to invoice board remuneration through a company. The board members may also receive separate remuneration for board assignments in subsidiaries of the company. To the extent members of the board of directors perform services within their respective areas of expertise outside of their duties as board members the remuneration shall be on market terms and be based on a consultancy agreement.
Salary and employment conditions for employees
In the preparation of the board of directors’ proposal for these remuneration guidelines, the board of directors’ has taken into account salary and employment conditions for employees of the company by including information on the employees’ total income, the components of the remuneration and increase and growth rate over time, in the remuneration committee’s and the board of directors’ basis of decision when evaluating whether the policy and the limitations set out herein are reasonable. The development of the gap between the remuneration to senior executives and remuneration to other employees will be disclosed in the remuneration report.
Duration and termination of employment, etc.
Senior management employment contracts are generally not limited in time. The notice period may not exceed six months if notice of termination of employment is made by the company. Upon termination by the company, and in addition to their fixed monthly salary during the notice period, the CEO is entitled to a maximum of twelve (12) months’ salary as severance pay and other members of the senior management may be entitled to severance pay in a maximum amount of six (6) months’ base salary. If termination is made by the senior executive, the period of notice may not exceed six months and there is no right to severance pay.
All directors shall retire from office at the end of each Annual General Meeting and they shall be eligible for re-election. Directors may be removed, in accordance with and subject to the terms of the Companies Act (Chapter 386 of the laws of Malta) (the “Companies Act”), prior to the expiry of their term of office by ordinary resolution of the shareholders in general meeting. The directors are not entitled to any severance pay in the event of any such removal.
The decision-making process to determine, review and implementation of the guidelines
The board of directors has established a remuneration committee. The committee’s tasks include preparing the board of directors’ decision to propose guidelinesfor executive remuneration. The board of directors shall prepare a proposal for new remuneration guidelines at least every fourth year and submit it to the general meeting. The guidelines shall be in force until new remuneration guidelines are adopted by the general meeting. The remuneration committee shall also monitor and evaluate programs for variable remuneration for the senior executives, the application of the guidelines for executive remuneration as well as the current remuneration structures and compensation levels in the company. The members of the remuneration committee are non-executive directors independent of the company and its senior executives. The composition of the committee and independence thereof aims to avoid any potential conflicts of interest in determining senior management remuneration. The CEO and other senior executives do not participate in the board of directors’ processing of and resolutions regarding remuneration-related matters in so far as they are affected by such matters.
Description of material changes to the guidelines and how the views of shareholders have been taken into consideration
Other than the period of applicability, the only material changes which these proposed guidelines purport to make to the 2020 Guidelines concern the maximum amount of variable remuneration for senior executives as well as the CEO's and other senior executives' severance pays.
Whereas the 2020 Guidelines provided that the CEO's and other senior executives' fixed base salary during the period of notice, together with any severance pay, could not exceed an amount equivalent to the CEO’s fixed base salary for six months, and three months for other senior executives; these guidelines propose that "Upon termination by the company, and in addition to their fixed monthly salary during the notice period, the CEO is entitled to a maximum of twelve 12 months’ salary as severance pay and other members of the senior management may be entitled to severance pay in a maximum amount of six (6) months’ base salary." Further these guidelines propose that the maximum amount of variable remuneration for senior executives shall amount to 50 per cent of the annual fixed base salary instead of 70 per cent.