Income Statement Group

NOTE 21

REMUNERATION PAYABLE TO SENIOR COMPANY OFFICERS

The below overview shows remuneration for the period 1 January to 31 December 2011 for top employees in the Infratek Group, defined as board members and Group management.

Remuneration to board members and group management 2011

Amounts in thousand NOK

 

 

 

Name

Position

Salary and remuneration ^1), 6)

Bonus

^2), 6)

Construction to pension plans ⁷⁾

Change in earned pension rights ⁷⁾

Loan

Numbers of shares held ³⁾

Board Members

Mimi K. Berdal

Chairman

Hans Kristian Rød, 4)

Board Deputy Chairman

Tove Elisabeth Pettersen

Board member

Dag Andresen

Board member

Dagne Hordvei, 5)

Board member

Roger Andrè Hansen

Board member (employee representative)

Otto Rune Stokke

Board member (employee representative)

Kalle Strandberg

Board member (employee representative)

Senior executives

Bjørn Frogner

CEO

Vibecke Skjolde

Group Executive Vice President / CFO

Lars Bangen

Group Executive Vice President Local Infrastructure

Alf Engqvist

Group Executive Vice President Central Infrastructure

Lars Erik Finne

Group Executive Vice President Security

Note:

1) Salary etc. Includes fixed salary, non-monetary payments, benefits of interest of free loans, electronic communication, etc in 2011 deducted by earned bonus in 2010 but paid in 2011

2) Earned bonus in 2011 as paid out in 2012 excluding holiday allowance

3) Including shares owned by related parties. Shares mainly acquired at market prices. As part of the listing at the Oslo Stock Exchange in December 2007, all employees were offered to purchase up to 1 500 shares at a 20 percent discount.

4) Hans Kristian Rød is employed in the Fortum group, which further holds 21.074.864 shares in Infratek ASA.

5) Dagne Hordvei resigned May 10th subsequent to the general meeting

6) Specified amounts also function as a basis for social security contribution, amounting to 14,1 percent in Norway and 31,4 percent in Sweden, respectively.

7) Specified amounts also function as a basis for social security contribution in Norway as well as for payroll taxes in Sweden, amounting to 14,1 percent and 24,26 percent respectively.

Remuneration to board members and group management 2010

Amounts in thousand NOK

Name

Position

Salary and remuneration ^1), 8)

Bonus ^2), 8)

Construction to pension plans ⁹⁾

Change in earned pension rights ⁹⁾

Loan

Numbers of shares held ³⁾

Board Members

Mimi K. Berdal

Chairman (from 11 november, 2010)

Gunnar Gjørtz4)

Chairman (until 11 november, 2010)

Hans Kristian Rød 5)

Board Deputy Chairman

Tove Pettersen4), 5)

Board member

Dag Andresen

Board member

Dagne Hordvei

Board member

Roger Andrè Hansen

Board member (employee representative)

Otto Rune Stokke

Board member (employee representative)

Kalle Strandberg

Board member (employee representative)

Senior executives

Bjørn Frogner

CEO

Vibecke Skjolde6)

Group Executive Vice President / CFO

Heidi Ulmo6)

Group Executive Vice President / CFO

Lars Bangen7)

Group Executive Vice President Local Infrastructure

Alf Engqvist7)

Group Executive Vice President Central Infrastructure

Lars Erik Finne

Group Executive Vice President Security

Note:

1) Salary etc. Includes fixed salary, non-monetary payments, benefits of interest of free loans, electronic communication, etc in 2010 deducted by earned bonus in 2009 but paid in 2010

2) Earned bonus represents earned bonus in 2010 excluding holiday allowance

3) Including shares owned by related parties. Shares mainly acquired at market prices. As part of the listing at the Oslo Stock Exchange in December 2007, all employees were offered to purchase up to 1 500 shares at a 20 percent discount.

4) Gunnar Gjørtz resigned on 11. november 2010 following an extraordinary general meeting and was replaced by Tove Pettersen.

5) Tove Pettersen and Hans Kristian Rød are employed in the Hafslund Group and the Fortum Group respectively, which own 27.652.360 and 21.074.864 shares recpectively in Infratek ASA.

6) Vibecke Skjolde assumed her position on 1 June 2010 and replaced Heidi Ulmo.

7) Alf Engqvist assumed his position on 16. August 2010 and replaced Lars Bangen who was the acting Group Managing Director for Central Infrastructure.

8) Specified amounts also function as a basis for social security contribution, amounting to 14,1 percent in Norway and 31,4 percent in Sweden, respectively.

9) Specified amounts also function as a basis for social security contribution in Norway as well as for payroll taxes in Sweden, amounting to 14,1 percent and 24,26 percent respectively.

Terms and conditions of the CEO and other members of group management

The CEO is entitled to a fixed annual salary of NOK 2.5 million, as well as a bonus amounting to no more than 50 per cent of his fixed annual salary. The bonus is determined annually based on the Group’s performance with respect to share price development and group targets, and an individual appraisal based on predefined goals. The CEO has a six-month notice period. In the event that his employment is terminated, he is entitled – upon certain conditions being met – to receive his salary for a period of 18 months in addition to the period of notice. Other members of group management are entitled to a fixed annual salary of between NOK 1.3 million and NOK 1.7 million. Annual bonuses are limited to no more than 35 per cent of fixed annual salary. Bonuses are determined annually. Half of the bonus paid to both the CEO and other members of group management shall be used to buy shares in Infratek ASA, with a lock-in period of two years given that the company is not in an insider position. Other members of group management have a six-month notice period and, in the event of termination of their employment, are entitled – upon certain conditions being met – to receive their salary for a period of 12 months in addition to the period of notice.

Group management’s pension rights vary based on the duration and type of position within the former Hafslund Group. CEO Bjørn Frogner and EVP Lars Erik Finne are members of Hafslund Private Pension Fund, while EVP, Lars Bangen, is a member of Hafslund Public Pension Fund.

The pension funds represent performance based pension schemes of between 60 and 70 per cent, with an upper limit set at 12 G (1 G = NOK 79.216). In addition to membership in Hafslund Private Pension Fund, Frogner and Finne have an annual deposit based pension plan equivalent to 3 per cent; up to 12 G. Vibecke Skjolde has a deposit based pension plan of 2 per cent of annual income up to 12 G. Norwegian members of the Group management have a right to early retirement pursuant to the prevailing AFP agreement. Pension age is 67.

Alf Engqvist is covered by the performance based pension plan which applies to civil servants in Sweden (the IPT plan). The payment is equivalent to 10 per cent of salaries between SEK 0 and SEK 390,750, 65 per cent of salaries between SEK 390 750 and SEK 1,042,000 and 32.5 per cent of salaries between SEK 1,042,000 and SEK 1,563,000 in 2011. Engquist also has a deposit based pension equivalent to 2 per cent of annual gross income. Pension age is 65.

Members of group management have group life insurance coverage, health insurance and an interest-free car loan of between NOK 400,000 and NOK 500,000, which is written down by a tenth of the original amount of the loan each year. In addition an annual car subsidy is paid. These benefits are included in the column for fixed salary, etc, and the interest benefit is declared for tax purposes. In addition benefits-in-kind such as ADSL (home office), mobile phone and newspapers are offered.

Share-based payment

No agreements have been entered into with respect to share-based payment schemes for employees of the Infratek Group.

Remuneration paid to Infratek ASA’s Board of Directors

The amount of directors’ fees is proposed by the company’s Selection Committee and is voted by the annual general meeting.

The remuneration paid to the Board of Directors breakes down as follows: chairman of the Board NOK 230,000; deputy chairman of the board, NOK 170,000; and other board members, NOK 150,000.

Declaration by the Board of Directors with respect to the salaries and other benefits payable to senior executives

At a meeting held on 6 February 2008 the Board of Directors of Infratek ASA issued this declaration with respect to the salaries and other benefits payable to senior executives, defined as the CEO and members of group management.

In accordance with Section 6-16a of the Public Limited Companies Act the Board will lay the following guidelines before the annual general meeting for its approval.

Fixed salary: To be based on the contents of the position, its level of responsibility, the competence of the incumbent and their length of tenure in the position. The salary shall be competitive with respect to the degree of responsibility and industrial level.

Benefits-in-kind: For the purpose of car ownership or where other satisfactory security is pledged, an interest-free loan to be written down over 10 years within accepted guidelines, may be granted. Furthermore, a subsidy for car running costs may also be granted. Benefits-in-kind shall otherwise largely be linked to expenses deriving from ADSL (home office), mobile phone and newspapers.

Annual bonus: Any bonus shall be predetermined and paid on the basis of the position’s level and the added value the employee or group of employees has generated. Annual bonuses for the CEO and members of group management shall be capped at 50 per cent of their fixed salaries. This stipulation may be waived by the Board of Directors, with the reasons for the decision being minuted. Bonuses are to be set annually. Group performance goals are determined by the Board.

Share ownership schemes: The CEO and members of group management may be included in share ownership schemes for all employees. In connection with share ownership schemes over and above those extended to all employees, a lock-in period shall be set for all or part of those schemes.

To strengthen the ties between the workforce and the Group, as well as to provide Infratek employees the opportunity to share in the Group’s future value creation, consideration shall be given to whether all employees should be given or have the chance to buy shares in Infratek ASA. Such a share scheme shall be evaluated in light of other forms of remuneration and of competitive remuneration within those markets in which the Group operates. Shares shall be granted on the basis of predefined key figures for the Group, as well as the type of position, number of hours worked (if part-time) and length of service. Any offer of shares shall be seen in light of the Group’s overall compensation costs.

Option schemes: The Group does not use option schemes.

Pension: Over and above legacy schemes, the CEO and members of group management may have a defined contribution scheme of up to five per cent of 12G, unless otherwise agreed with the Board. The retirement age for these individual shall, as a rule, be 67. The CEO and members of group management are entitled to retire early in accordance with the regulations governing the AFP early retirement scheme in effect at any given time.

Notice and severance pay: The CEO and members of group management may terminate their employment at six-months’ notice. In certain circumstances, and depending on the position concerned, severance pay of between 12 and 18 months may be paid in addition.

All members of Infratek’s group management receive a remuneration that falls within the terms of the Board’s declaration with respect to the salaries and other benefits payable to senior executives.

The guidelines for determining salaries and other benefits were first adopted at a meeting of the Board of Directors on 26 October 2007. The Group will seek to implement these guidelines in the Group, but respect any agreements previously entered into.