Remuneration Report
Information according to Section 315 (2) no. 4 HGB (German Commercial Code) Remuneration Report for the Board of Management
The remunerations for the members of the Board of Management of CEWE COLOR Holding AG, Oldenburg, are determined by the Supervisory Board. They are composed of fixed and performance-related variable earnings. The fixed earnings consist of a monetary basic amount and benefits in kind, and the performance-related part includes a profit-sharing bonus as well as components with a long-term incentive effect. In addition to the duties of the Board of Management and the personal performance, the performances of the entire Board of Management as well as the economic success and the comparable environment of the CEWE COLOR Group constitute the criteria for the calculation of the total remuneration. The Supervisory Board is responsible for the prompt implementation of the legal requirements of the law on the appropriateness of the remuneration of the Board of Management (VorstAG), effective as at August 5, 2009.
In detail the following applies: The non-performance-related fixed earnings will be paid as a constant salary on a monthly basis. Moreover, the members of the board receive benefits in kind which are reported according to the taxable amounts. In general, this concerns the use of a company car as well as the function-related insurance premiums; the benefits in kind are subject to taxes to be paid by the individual members of the Board of Management who are all equally entitled to such benefits.
The profit-sharing bonus as a performance-related part of the total remuneration depends on the economic performance of the CEWE COLOR Group and its gross cash flow. The currently ongoing third Stock Option Plan 2005 represents another performance-related component of the remuneration. In this plan, members of the Board of Management participated with the purchase of a total of 36,000 option rights in 2005. The participation as such and the scope of the purchase of options was facultative for the board members. The price of each option amounted to 0.50 euros. The fair value per option pursuant to IFRS 2.10 et seq. for the board members was at 15.04 euros at the date of granting. There are no other option plans at present. Neither in the business year 2009 nor in the previous year did the members of the Board of Management benefit from any payments from the exercise of option rights from any stock options plans. With regard to the structure of the Stock Option Plan, reference is made to the explanations concerning equity in the notes to the consolidated financial statements on page 124 et seq.
Total remuneration, non-performance-related and performance-related (profit-sharing bonus) remunerations of the members of the Board of Management of CEWE COLOR Holding AG, Oldenburg, in fiscal 2009, which they received for the execution of their tasks in the parent company and the subsidiaries amounted to 968 thousand euros (last year: 1,160 thousand euros). These are composed as follows:The variable performance-related earnings of the active board members of CEWE COLOR Holding AG, Oldenburg,amounted to 212 thousand euros and thus are 19.4 % lower than in the preceding year (262 thousand euros). The main reason for this decline is the retirement of Mr. Michael Wefers from the Board of Management of CEWE COLOR Holding AG, Oldenburg, as at December 31, 2008. Adjusted for this effect, the variable earnings of the members of the Board of Management declined by 3.2 % as against the year 2008.For the business year 2008, the last year of his active period in the company, Mr. Wefers received a bonus payment of 40 thousand euros. As from the current fiscal year 2010, the Board of Management of CEWE COLOR Holding AG, Oldenburg, will expand by one member, Dr. Olaf Holzkämper, Oldenburg.The variable earnings / bonuses for fiscal year 2009 paid in 2010 totalling 240 thousand euros, will exceed those of the preceding year by 13.5 % (212 thousand euros).
No agreements have been concluded between CEWE COLOR Holding AG, Oldenburg, and the members of the Board of Management in the event of premature terminations of the employment. Moreover, no compensation agreements have been concluded with the members of the Board of Management in case of a takeover bid (Section 315 (4), no. 9; also refer to page 75).
Pension commitments for which in part re-insurance policies have been taken out exist for the members of the Board of Management. The amount of the pension commitments is determined by two ninth of the last fixed remuneration received for each period of five years of the activity as a member of the Board of Management, however, six ninth at most. For Dr. Rolf Hollander and Mr. Andreas F. L. Heydemann, the total fixed remuneration for their activity as a member of the Board of Management of CEWE COLOR Holding AG, Oldenburg, and of Neumüller CEWE COLOR Stiftung, Oldenburg, serve as reference value. For Dr. Reiner Fageth the fixed remuneration for his activity as a board member of CEWE COLOR Holding AG, Oldenburg, is decisive. These commitments do not include survivors’ benefits. The service cost for pension benefits in 2009 is shown below taking into account an actuarial interest rate of 5.75 % (last year: 6,0 %) in line with the application of the projected unit credit method according to IAS / IFRS.
In addition to their pension commitments as members of the Board of Management, Dr. Rolf Hollander and Mr. Andreas F. L. Heydemann will receive an old-age pension after their retirement at the age of 65 within the scope of the standard company pension scheme from a direct pension commitment. This includes survivors’ benefits amounting to 50 % of the respective pension. Dr. Reiner Fageth will receive an old-age pension of an economically equal value from an employer-financed pension fund within the scope of the standard company pension scheme.
Finally, as part of the company pension scheme, a life insurance policy for an insured sum of 38 thousand euros each with capital payment in the event of premature death as survivors’ benefits or in the event of their survival as a pension was taken out in addition. The annual expenditure for this amount to 1 thousand euros for each member of the Board of Management (last year: 1 thousand euros). No loans or advance payments were granted. Moreover, no contingent liabilities were assumed for the benefit of members of the board.
Remuneration Report for the Supervisory Board
According to the articles of association, the Supervisory Board consists of six members. The remuneration of the members of the Supervisory Board is defined by the articles of association and is composed of a fixed and two variable elements. The fixed remuneration amounts to 4.0 thousand euros per year. In addition, every member receives a dividend-related remuneration. The Chairman of the Supervisory Board receives 1.5 times these amounts, and his deputy is paid 1.25 times these amounts. Finally, every member receives 1.0 thousand euros for each attendance at the meetings of the Supervisory Board (last year: 0.5 thousand euros). None of the members of the Supervisory Board has any option rights.
No loans or advance payments were granted. Moreover, no contingent liabilities were assumed for the benefit of
members of the Supervisory Board.
Remuneration report for former members of the Board of Management and the Supervisory Board
No payments were granted for former members of the Supervisory Board. Pension provisions for former members of the Board of Management amounted to 2,540 thousand euros (last year: 2,616 thousand euros) as of the effective date of December 31, 2009. The pensions for the business year 2009 amounted to 299 thousand euros (last year: 289 thousand euros). The pension provisions made for this group of persons were transferred to CEWE COLOR Versorgungskasse e. V., Wiesbaden, with effect of April 1, 2007. The consolidated financial statements include this company according to IAS 32 in conjunction with IAS 19. In relation to the pensions paid to former members of the Board of Management, Mr. Michael Wefers, who retired from the Board of CEWE COLOR Holding AG, Oldenburg, as at December 31, 2008, received 103 thousand euros from claims arising from a post-contractual prohibition of competition, as well as an additional 40 thousand euros as bonus for fiscal year 2008, being the last year of his activities in the company. No loans or advance payments were granted and no contingent liabilities were assumed for former members of the Supervisory Board and of the Board of Management of CEWE COLOR Holding AG, Oldenburg.
Miscellaneous
The company has a third party group liability insurance policy for financial loss for all members of the Board of Management, managing directors and executives of the CEWE COLOR Group in Germany and abroad. This policy is taken out, or renewed respectively, every year. The insurance covers the personal liability risk in the event that a claim for financial loss is made against this group of persons while executing their activities (D & O insurance). In addition, a special legal expenses insurance policy for criminal defence provides insurance cover for all staff members. This insurance policy also covers the legal representatives and the members of the Supervisory Board against offences they committed or are alleged to have committed while performing their duties.
