- Compensation of the Management Board
- Commitments to members of the Management Board for the event of the termination of their appointment
- Miscellaneous
- Adjustments to to system of compensation of the Management Board
- Information on the supervisory board
Compensation of the Management Board
The entire Supervisory Board is responsible for determining the compensation of the Management Board. The Supervisory Board is assisted in this task by a personnel committee. In the year under review, the personnel committee was composed of Dr. Gerd Krick, Dr. Karl Schneider and Wilhelm Sachs.
The objective of the compensation system is to enable the members of the Management Board to participate reasonably in the sustainable development of the Company’s business with the compensation paid and to reward them based on their duties and performance as well as their successes in managing the Company’s economic and the financial position while giving due regard to the peer environment.
The compensation of the Management Board is, as a whole, performance-oriented and was composed of three elements in the fiscal year 2009:
- non-performance-related compensation (basic salary)
- performance-related compensation (variable bonus)
- components with long-term incentive effects (stock options)
In addition, three members of the Management Board had pension commitments in the reporting period.
The design of the individual components is based on the following criteria:
The non-performance-related compensation was paid in twelve monthly installments as basic salary in the fiscal year 2009. In addition, the members of the Management Board received additional benefits consisting mainly of insurance premiums, the private use of company cars, special payments such as rent supplements and reimbursement of certain other charges as well as contributions to pension and health insurance.
The performance-related compensation will also be granted for the fiscal year 2009 as a variable bonus. The amount of the bonus in each case generally depends on the achievement of the individual targets relating to the net income attributable to Fresenius SE and its segments. For the total performance-related compensation, the maximum achievable bonus is fixed.
For the fiscal years 2009 and 2008, the amount of cash payment of the Management Board of Fresenius SE consisted of the following:
Non-performance-related compensation | Performance-related compensation |
Cash compensation (without long-term incentive components) |
||||||
---|---|---|---|---|---|---|---|---|
Salary 1 | Other | Bonus | ||||||
in thousand € | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 |
1 Includes insurance premiums, private use of company cars, contributions to pension and health insurance as well as other benefits. | ||||||||
2 Dr. Ben Lipps receives his compensation only from Fresenius Medical Care, of which Fresenius SE held 35.58 % of the total subscribed capital. As Dr. Ben Lipps is a member of the Management Board of Fresenius SE, his compensation has to be included in the compensation report of the Fresenius Group. | ||||||||
Dr. Ulf M. Schneider | 800 | 800 | 56 | 39 | 1,032 | 1,165 | 1,888 | 2,004 |
Rainer Baule | 425 | 425 | 41 | 40 | 800 | 900 | 1,266 | 1,365 |
Dr. Francesco De Meo | 425 | 425 | 18 | 18 | 543 | 490 | 986 | 933 |
Dr. Jürgen Götz | 325 | 325 | 28 | 29 | 424 | 360 | 777 | 714 |
Dr. Ben Lipps 2 | 860 | 816 | 251 | 202 | 1,200 | 963 | 2,311 | 1,981 |
Stephan Sturm | 425 | 425 | 85 | 84 | 732 | 850 | 1,242 | 1,359 |
Dr. Ernst Wastler | 375 | 375 | 27 | 17 | 473 | 390 | 875 | 782 |
Total | 3,635 | 3,591 | 506 | 429 | 5,204 | 5,118 | 9,345 | 9,138 |
In the fiscal year 2009, stock options based on the Fresenius SE Stock Option Plan 2008 and the Fresenius Medical Care AG & Co. KGaA Stock Option Plan 2006 were granted as components with long-term incentive effects. The principles of both plans are described in more detail in note 34 of the notes of the Fresenius Group, Stock options.
For the fiscal years 2009 and 2008, the number and value of stock options issued is shown in the following table:
Long-term incentive components
Stock options 1 | ||||
---|---|---|---|---|
Number | Value in thousand € | |||
2009 | 2008 | 2009 | 2008 | |
1 Stock options that were granted in 2009 and 2008 under the Fresenius SE stock option plan. Dr. Ben Lipps received stock options under the Fresenius Medical Care stock option plan. | ||||
Dr. Ulf M. Schneider | 51,600 | 51,600 | 425 | 815 |
Rainer Baule | 25,800 | 25,800 | 213 | 408 |
Dr. Francesco De Meo | 25,800 | 25,800 | 213 | 408 |
Dr. Jürgen Götz | 25,800 | 25,800 | 213 | 408 |
Dr. Ben Lipps | 99,600 | 99,600 | 761 | 976 |
Stephan Sturm | 25,800 | 25,800 | 213 | 408 |
Dr. Ernst Wastler | 25,800 | 25,800 | 213 | 408 |
Total | 280,200 | 280,200 | 2,251 | 3,831 |
The stated values of the stock options granted to members of the Management Board in the fiscal year 2009 correspond to their fair value at the time of grant, namely a value of € 8.24 (2008: € 15.80) per stock option of Fresenius SE and € 7.64 (2008: € 9.80) per stock option of FMC-AG & Co. KGaA.
As the financial targets of the year 2009 were achieved, Dr. Ben Lipps is entitled to a stock-based compensation in an amount of € 341 thousand (2008: € 425 thousand). The entitlement is based on the development of the ordinary share of Fresenius Medical Care and has a three years vesting period. At the end of the fiscal year 2009, the members of the Management Board held a total of 901,500 (2008: 720,900) stock options and convertible bonds of Fresenius SE and 703,416 (2008: 818,411) stock options and convertible bonds of FMC-AG & Co. KGaA.
The development and the status of the stock options of the Management Board in the fiscal year 2009 are shown in the following table:
Dr. Ulf M. Schneider |
Rainer Baule |
Dr. Francesco De Meo |
Dr. Jürgen Götz |
Dr. Ben Lipps1 |
Stephan Sturm |
Dr. Ernst Wastler |
Total2 | |
---|---|---|---|---|---|---|---|---|
1 Dr. Ben Lipps holds stock options under the Fresenius Medical Care stock option plan. Only stock options and convertible bonds of Fresenius SE, excluding stock options of Dr. Ben Lipps. | ||||||||
2 Only stock options and convertible bonds of Fresenius SE, excluding stock options of Dr. Ben Lipps. | ||||||||
Options outstanding on January 1, 2009 | ||||||||
number | 270,900 | 161,250 | 55,800 | 62,730 | 818,411 | 113,520 | 56,700 | 720,900 |
average exercise price in € | 36.61 | 34.02 | 51.18 | 50.79 | 24.57 | 42.71 | 47.29 | 40.19 |
Options granted during fiscal year | ||||||||
number | 51,600 | 25,800 | 25,800 | 25,800 | 99,600 | 25,800 | 25,800 | 180,600 |
average exercise price in € | 36.89 | 36.89 | 36.89 | 36.89 | 31.97 | 36.89 | 36.89 | 36.89 |
Options exercised during fiscal year | ||||||||
number | 0 | 0 | 0 | 0 | 214,595 | 0 | 0 | 0 |
average exercise price in € | 15.32 | |||||||
average stock price in € | 28.50 | |||||||
Options outstanding on December 31, 2009 | ||||||||
number | 322,500 | 187,050 | 81,600 | 88,530 | 703,416 | 139,320 | 82,500 | 901,500 |
average exercise price in € | 36.65 | 34.42 | 46.66 | 46.74 | 28.44 | 41.63 | 44.04 | 39.53 |
average remaining life in years | 5.7 | 5.2 | 6.4 | 6.4 | 4.2 | 6.2 | 6.2 | 5.9 |
range of exercise prices in € | 13.59 to 57.27 |
13.59 to 57.27 |
36.89 to 57.27 |
29.92 to 57.27 |
14.47 to 35.49 |
29.92 to 57.27 |
21.33 to 57.27 |
13.59 to 57.27 |
Exercisable options on December 31, 2009 | ||||||||
number | 175,438 | 113,516 | 14,996 | 19,310 | 404,616 | 65,786 | 20,396 | 409,442 |
average exercise price in € | 27.81 | 26.14 | 46.41 | 43.71 | 24.48 | 35.41 | 37.01 | 30.46 |
The following table shows the total compensation for the years 2009 and 2008:
Cash compensation (without long-term incentive components) |
Long-term incentive components |
Total compensation (including long-term incen- tive components) |
||||
---|---|---|---|---|---|---|
in thousand € | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 |
Dr. Ulf M. Schneider | 1,888 | 2,004 | 425 | 815 | 2,313 | 2,819 |
Rainer Baule | 1,266 | 1,365 | 213 | 408 | 1,479 | 1,773 |
Dr. Francesco De Meo | 986 | 933 | 213 | 408 | 1,199 | 1,341 |
Dr. Jürgen Götz | 777 | 714 | 213 | 408 | 990 | 1,122 |
Dr. Ben Lipps | 2,311 | 1,981 | 1,102 | 1,401 | 3,413 | 3,382 |
Stephan Sturm | 1,242 | 1,359 | 213 | 408 | 1,455 | 1,767 |
Dr. Ernst Wastler | 875 | 782 | 213 | 408 | 1,088 | 1,190 |
Total | 9,345 | 9,138 | 2,592 | 4,256 | 11,937 | 13,394 |
The components with long-term incentive effect can be exercised only after the expiry of the specified vesting period. Their value is recognized over the vesting period as expense in the respective fiscal year. The expenses attributable to the fiscal years 2009 and 2008 are stated in the following table.
Expenses for long-term incentive components |
||
---|---|---|
in thousand € | 2009 | 2008 |
Dr. Ulf M. Schneider | 694 | 714 |
Rainer Baule | 347 | 357 |
Dr. Francesco De Meo | 171 | 68 |
Dr. Jürgen Götz | 289 | 219 |
Dr. Ben Lipps | 1,857 | 1,348 |
Stephan Sturm | 357 | 383 |
Dr. Ernst Wastler | 171 | 68 |
Total | 3,886 | 3,157 |
The non-performance-related compensation components and the basic structures of the performance-related compensation components are agreed in the service agreements with the individual Management Board members. The stock options are granted on an annual basis by the Supervisory Board to the Management Board.
Compensation Report