Remuneration to the board of directors
Fees and other remuneration to the Board members are determined at the AGM. At the AGM on June 1, 2023, it was resolved that the total fees to Board members, including committee work, would amount to SEK 2,745,000 and allocated as follows:
- Fees to Chairman of the Board Eugen Steiner totaling SEK 775,000 and fees to Deputy Chairman Ivar Verner totaling SEK 310,000
- For regular Board members not employed by the company (i.e. five members excluding Lars Lannfelt) fees totaling SEK 260,000 each
- Fees in the Audit Committee totaling SEK 100,000 to the Chairman and SEK 60,000 to the other non-executive committee members
- Fees in the Remuneration Committee totaling SEK 60,000 to the Chairman and SEK 40,000 to the other non-executive committee members
- No fees are paid to the Research Committee
For the financial year 2022 the board members received remuneration as set out in the table below. All amounts in kSEK.
|Name||Elected||Independent in relation to company and management||Independent in relation to major shareholders||Audit Committee||Remuneration Committee||Board||Audit Committee||Remuneration Committee|
|1) Resigned from the Committee on August 31, 2022.
2) Succeeded Lotta Ljungqvist as a member on August 31, 2022.
3) Succeeded Wenche Rolfsen as Chairman on August 31, 2022.
Remuneration to the CEO and senior management
Senior management refers to the CEO and the management group, which consists of ten persons in total. The purpose of the guidelines concerning remuneration to senior executives is to provide BioArctic with the conditions for attracting, motivating and retaining competent managers. Remuneration is to be market-based and competitive and should reflect the performance and responsibilities of the individual as well as BioArctic’s financial performance. At the same time, the remuneration should be in line with shareholder interests. Remuneration is to consist of fixed and variable salary, the customary employment benefits and market-based pension.
For the fiscal year 2022 the CEO and senior executives received remuneration as set out in the table below. All amounts in kSEK.
|Senior executives||Fixed salary / Fees||Variable remuneration||Pension||Sharebased remuneration||Total|
|CEO Gunilla Osswald||5 346||1 418||1 434||531||8 730|
|Other senior executives (8 persons) 1, 2||13 552||2 431||3 352||602||19 937|
|Total remuneration and other benefits||23 534||3 849||5 222||1 133||33 737|
|1) Lars Lannfelt is active in the company and is employed at 100% of full-time service. Lars is part of the management group but is reported in the Board of Directors only in the table above so as not to be double-counted.
2) The amount does not include any invoiced fees (kSEK 1,915).
CEO Gunilla Osswald received remuneration of kSEK 5,346 as fixed annual salary and an additional 35 percent in pension provisions. The CEO is covered by the rewards program covering all employees; see below. In 2022, the CEO had variable remuneration of up to 35 percent of annual salary. Between BioArctic and the CEO, there is a notice period of 12 months by BioArctic and 6 months by the CEO. Upon termination by BioArctic, the company has the right to relieve the employee during the notice period.
Company management comprises tensenior executives. Senior executives except the CEO receive normal market remuneration and individually negotiated premiums for service pension or alternately premiums under the terms of BioArctic’s pension plan. All other employees receive market salaries, and premiums are allocated to the occupational pension in accordance with the terms of the BioArctic’s pension plan. All employees have a contractual mutual notice period of three months or alternately in accordance with the Employment Protection Act. Severance pay is not applied.
BioArctic has one reward program covering all permanent employees. One condition for receiving variable remuneration is that the employee has been employed for more than six months at the time when the goal that forms the basis for payment of variable remuneration is reached. The goals are linked to milestones achieved under the research program for Alzheimer’s disease. The potential variable remuneration to the employee amounts to one month’s salary per milestone. The variable remuneration is not pensionable.
Variable remuneration will be related to the outcome of BioArctic’s goals and strategies and based on predefined and measurable criteria designed to promote long-term value creation. The share of total remuneration that comprises variable remuneration may vary depending on position. At most, however, variable remuneration – except for remuneration under the company’s milestone-based program – can correspond to 50 percent of the senior executive’s annual fixed salary. Variable remuneration must be non-pensionable to the extent it does not otherwise follow from compulsory provisions in collective bargaining agreements.
Share-based incentive programs
BioArctic has two ongoing long-term incentive programs that were approved at the AGM 2019 and at the AGM 2023.
A maximum of 1, 000,000 stock options may be granted within the Stock Option Program 2019/2028. To enable the company’s delivery of shares under program, the Annual General Meeting approved a directed issue of a maximum of 1,000,000 warrants.
The employee stock options may be exercised three to five years after grant. A total of 915,000 options have been granted, and no further grants may occur. As of June 30, 2023, the number of lapsed options amounted to 70,000 and the number of exercised options amounted to 166,500, which means that 678,500 employee employee stock options remain outstanding corresponding to a dilutive effect of up to 0.8 percent of the share capital.
The Performance Share Unit (PSU) program 2023/2026 is a three-year incentive program including a maximum of 125,000 PSUs that, provided that the share price increases by at least 30 percent during a three-year period, entitles the participants to receive shares free of charge or a cash payment. If the board decides to utilize warrants to deliver the B-shares according to the terms and conditions of the program or for financing the company’s costs for the program, the dilutive effect would be a maximum of 0.14 per cent of the share capital outstanding at the end of the period.