Remuneration System
Notes on the System of Remuneration for the Members of the Management Board
Remunerations to the Management Board contain both fixed and variable parts. Members of the Management Board receive the following as a fixed remuneration: a monthly salary, social security contributions, a direct insurance premium payment equaling the current legally-defined maximum income tax lump sum amount, as defined in § 40 EstG (Einkommensteuergesetz: German income tax law), and also a company car which is also for personal use.
The variable parts of remunerations are oriented towards short and long-term targets.
The Management Board receives an annual bonus based on newly-fixed targets as short-term variable component of their remuneration.
The component intended to have a long-term motivational effect, and which has an element of risk, comprises a 3 year bonus program and a share option scheme.
The 3 year bonus program involves the growth and results targets of the Utimaco group. It runs from the financial year 2004/2005 and will finish at the end of the fiscal year 2006/2007. The bonus program will be calculated at the end of the fiscal year 2006/2007 based on the targets that have been achieved by then.
The share option scheme was approved at the General Meeting on the 24th November 2005. From this share option scheme, the Management Board had received respectively 80,000 options in February and November 2006. The options can usually be exercised after a waiting period of three years within a three year time slot. The basic price corresponds to the weighted listed domestic share price of the share in the twelve months preceding the General Meeting of 24th November 2005. It corresponds to Euro 6.51 per share. Each option can only usually be exercised if, during the twelve months prior to the expiration date of the waiting period, the average price as defined in § 5 WpÜG-Angebotsverordnung (Offer Regulations of the German Securities Acquisition and Takeover Act) is at least 10% higher on at least one day than the average price as defined in § 5 WpÜG-Angebotsverordnung on the day of the General Meeting before the affected options are issued and, at the same time, the development in share values of the DAX has been reached or exceeded. Independently of this, the Management Board may exercise their options after a waiting period of two years if one share-holder or a group of share-holders hold the majority of shares in the company. The option value is defined in accordance with IFRS 2 for the options issued in February 2006 at a price of Euro 4.26 and for the options issued in November 2006 at a price of Euro 6.34.
No annual or long-term target can be changed retrospectively.
Oberursel, February 2007
Utimaco Safeware AG
