Annual Report 2009 - Von Roll

Corporate Governance 335. | Remuneration, profit-sharing and loans5.1| Content of and procedure for determining remuneration and profit-sharing programmesThe People & Remuneration Committee of the Board of Directors draws up the parameters for the remuneration ofthe Members of the Board of Directors annually and submits them to the Board of Directors for approval. The servicesof an external adviser were not called upon during the reporting year. The People & Remuneration Committeeregularly reviews the contracts of employment and the relevant income of the CEO and the other Members of theExecutive Management. This is carried out on the principle of attracting the most suitable and well-qualified personnelfor the company. The management is paid fairly at normal market rates, based on salary comparisons, in linewith their abilities, experience and qualifications. The remuneration comprises a fixed wage plus a variable performance-relatedcomponent. The level of the performance-related components depends on the attainment of personaltargets set annually and the attainment of the company’s targets. The Members of the Board of Directorsreceived a fixed salary in the form of a cash payment in 2009. The CEO’s salary also covered his activities on behalfof the Board of Directors, i.e. he will not receive any additional remuneration for his activities as a Member of theBoard of Directors. The non-executive Members of the Board of Directors did not receive either additional remunerationor emoluments in the form of additional fees, shares or options. The Members of the Executive Board receiveda basic salary plus a performance-related salary component, 30 % of which is based on personal targetsand 70 % on the success of the company. The basic salary constitutes around 60 % and the performance-relatedsalary component constitutes 40 % of the whole salary.In 2007, a stock option plan was introduced for the Members of the Executive Management. Under this plan, theMembers of the Executive Management may be granted options free of charge each year, although there is noobligation to do so. The options may be exercised at any time for a period of three years for a price determined atthe grant date, if at the time of exercise, provided that the relevant member fulfills the criteria, e.g. is still employedby the company. A maximum of 50 % of the options granted may be exercised each year. The option plan entitlesthe beneficiary to subscribe to shares (equity settlement). The potential commitment to provide shares for optionswill be covered solely by the purchase of shares on the stock exchange.In 2007, 500,000 options to acquire 500,000 shares were granted to the Executive Management. The exerciseprice is fixed at CHF 20. The options issued under this tranche may be exercised from the grant date until 31 December2010; however, only 50 % may be exercised in 2007 and 2008 together, and also 50 % in 2009.In the reporting year, 500,000 options to acquire 500,000 shares were granted to Members of the Executive Management.The exercise price is fixed at CHF 12. The options issued under this tranche may be exercised from thegrant date until 31 December 2012; however, only 50 % may be exercised in 2009 and 2010, and 50 % in 2011. Pleasesee the notes to the financial statements for detailed information on the remuneration actually paid to the Membersof the Board of Directors and the Executive Management.