Remuneration committee

The Committee is tasked with proposing the CEO’s salary, other remuneration and terms of employment. The Committee also proposes guidelines for remuneration and terms of employment for other members of the executive management and proposals for incentive programs. The Remuneration Committee shall ensures that established guidelines for remuneration to members of the executive management are complied with.

Since the 2025 AGM, the Remuneration committee has consisted of:

Patrik Tigerschiöld (Chairman)
Arun Bansal
Bo Risberg

The Remuneration committee held three meetings in 2024.

Remuneration to the CEO and other senior executives

The principles for remuneration to the CEO and other senior executives are approved by the Annual General Meeting. The proposed principles are prepared by the Board’s Remuneration Committee. The Board passes a decision on the proposed principles, which is then put to the Annual General Meeting for approval. The 2025 AGM established the following guidelines for remuneration and other terms of employment for senior executives.

Senior management position holders

Senior management position holders are the CEO and other members of the executive management team. The executive management team currently comprises of seven persons, including the CEO, of which three are women.

Guidelines for remuneration to the Executive Management

Introduction

These Guidelines for Remuneration to the Executive Management (the “Guidelines”) are applicable to remuneration agreed, and amendments to remuneration already agreed, after the adoption of the Guidelines by the Annual General Meeting on May 7, 2025. These Guidelines encompass remuneration to the Board of Directors, the CEO and the executive management, however, these Guidelines do not apply to any remuneration decided or approved by the General Meeting.

The Board of Directors shall be entitled to temporarily depart from these Guidelines, in whole or in part, if special reasons justify doing so in an individual case and such deviation is necessary in order to meet the company’s long-term interests and sustainability or to ensure the company’s financial viability. If such a departure occurs, it must be reported in the remuneration report before the next Annual General Meeting. These Guidelines pertain to the period starting from the Annual General Meeting on May 7, 2025. Any issue regarding departure from these Guidelines shall be prepared by the Remuneration Committee and decided by the Board of Directors.

The Guidelines’ promotion of the company’s business strategy, long-term interest and sustainability

Mycronic's strategy is to be a market-leading solutions provider within defined niches of the electronics industry. We create value by focusing on innovations that help drive the transition to a more sustainable electronics industry. This strategy will allow us to achieve our vision of being the most trusted partner to the creators of tomorrow’s electronics – delivering value for employees, customers, shareholders and society.

The Board of Directors considers that it is critical for the successful implementation of the company’s business strategy and safeguarding of its long-term interests, that the company is able to recruit and retain members of the executive management with the competence and capacity to achieve specified goals. To this end, the company must offer competitive remuneration to motivate the executive management. Short-term variable pay covered by these Guidelines shall be based on criteria that aim at promoting the company’s business strategy and long-term interests, including its sustainability, and where the fulfillment of the criteria is determined by the method set out below.

Forms of remuneration, etc.

The remuneration and other terms of employment for members of the executive management shall be based on market terms. Total remuneration consists of base salary and variable pay, pension and other benefits. In addition, the General Meeting may – regardless of these Guidelines – resolve on, inter alia, share-related or share-price related remuneration. Such pay is therefore excluded in the calculation of the total remuneration and the relative proportion of the remuneration components.

Fixed remuneration

In establishing the base salary for the CEO and members of the executive management, the scope and complexity of the position in question, as well as the individual’s performance is taken into account. The executive managements’ salaries are, like the other components of remuneration, subject to annual review by the Remuneration Committee. The base salary constitutes a maximum of 65 percent of total remuneration in the event of a maximum outcome of short-term variable pay.

Short-term variable remuneration

The short-term variable pay covered by these Guidelines shall aim at promoting the company’s business strategy and long-term interests, including its sustainability. The short-term variable pay shall be dependent upon either the company’s and/or the individual’s fulfillment of criteria set annually or with another periodicity. In that way the short-term variable pay is clearly related to the company’s development and/or the work contributions and performance of the individual. The criteria can be financial or non-financial, qualitative or quantitative, and shall be based on factors which support the company’s business strategy and long-term interests. Examples of financial criteria that may be applied are order intake, cost control and EBIT. Examples of non-financial criteria that may be applied are diversity, reduced carbon footprint, reduced energy consumption and increased use of environmentally friendly and sustainable materials. Short-term variable pay may also be awarded in extraordinary circumstances, provided that such extraordinary arrangements are applied on an individual basis only, either for the purpose of recruiting or retaining members of the executive management, or as remuneration for extraordinary performance beyond the individual’s ordinary tasks. The outcome is prepared by the Remuneration Committee and approved by the Board of Directors in connection with the end of the qualification period or after or in connection with an extraordinary circumstance or event. The remuneration is thereafter paid out. The short-term variable pay can amount to a maximum of 120 percent of base salary and 55 percent of total remuneration. Variable pay shall not be pensionable, unless otherwise provided by mandatory law or obligations in applicable collective bargaining agreements. The company has no contractual right to recover the remuneration.

Long-term variable remuneration

Members of the executive management can be offered incentive programs, which mainly should be share-related or share-price-related. An incentive program is intended to improve the participants’ commitment to the company’s development and shall be introduced on market-based terms. Resolutions on share-related or share-price-related incentive programs must be passed at a General Meeting and are therefore not covered by these Guidelines.

Other long-term remuneration
There are already existing agreements on long-term variable pay linked to continued employment for certain members of the executive management.

Benefits

Pension
Members of the executive management employed in Sweden after 2012 are covered by the contribution-defined plan under ITP1. Members of the executive management employed prior to January 1, 2022 have a supplementary contribution-defined pension plan in addition to the ITP plan. The retirement age for members of the executive management employed in Sweden is 65 years. For members of the executive management employed outside of Sweden, locally competitive pension plans and retirement ages are applied.

Other benefits
Other benefits e.g. car benefits and health care plans are established based on them being competitive in the local market.

Pension and other benefits constitute a maximum of 40 percent of total remuneration in the event of a maximum outcome of short-term variable pay.

Expat arrangements etc.

Members of the executive management who are required to relocate (expatriates) and/or commute internationally to execute the requirements of their role, may receive additional benefits and/or allowances to the extent reasonable in light of the special circumstances associated with such international relocation and/or commuting arrangements. Such additional benefits and/or allowances shall be decided by the CEO provided that the benefits and/or allowances is in accordance with the company’s policy regarding international relocation and/ or commuting as adopted by the Board of Directors from time to time. The aforementioned benefits and/or allowances may include (but is not limited to) commuting or relocation costs, cost of living adjustments, housing, home travel or education allowance, tax and social security equalization assistance.

Additional arrangements

In addition, it may on a case-by-case basis be proposed by the Remuneration Committee and approved by the Board of Directors to compensate an individual for remuneration forfeited from a previous employer during recruitment. The Remuneration Committee and the Board of Directors will consider on a case-by-case basis if all or some of the remuneration, including incentives forfeited need to be “bought-out”.

If there is a buy-out of forfeited incentives, this will take into account relevant factors including the form they were granted (cash vs. shares), performance conditions attached to these awards and the time they would have vested/paid. Generally, buy-out awards will be made on a comparable basis to those forfeited.

In the event of an internal candidate being promoted to the executive management, legacy terms and conditions may be honored, including pension and benefits entitlements and any outstanding incentive awards. If a member of the executive management is appointed following a merger or acquisition with/of another company, legacy terms and conditions may be honored.

Special adjustments

Regarding employment contracts governed by rules other than those applying in Sweden, appropriate adjustments may be made in order to comply with such mandatory rules or local practices in the individual’s country of employment, taking into account, to the extent possible, the overall purpose of these Guidelines.

Notice of termination and severance pay

The employment or contractual agreements of members of the executive management shall be valid until further notice or for a specified period of time. For the CEO, in the event of termination by the company, a twelve months’ notice period and twelve months’ severance pay apply. For members of the executive management employed in Sweden, the mutual notice period is a maximum of six months. Upon termination by the company, six months’ severance pay also applies. During the notice period, the current employment contract runs with associated benefits. In cases where severance pay would be paid, no other benefits will be paid after the expiry of the notice period. For members of the executive management who are locally employed outside of Sweden, employment or contractual agreements shall comply with mandatory rules applicable in the relevant jurisdiction or local practices in the individual’s country of employment, entailing that e.g. other term of the employment (or term of contract as the case may be), other notice periods and other agreements on severance pay may be applicable in the individual case.

Salary and terms of employment

In preparing the Board of Directors’ proposal for these Guidelines, the salaries and terms of employment for the company’s other employees have been taken into account. Information about the executive managements’ total remuneration, components of their remuneration, as well as increases in remuneration and rates of increase over time have been obtained and have constituted a part of the Remuneration Committee’s and the Board of Directors’ decision basis in their evaluation of the fairness of these Guidelines and the limitations arising from them.

The resolution process

The Board of Directors shall prepare a proposal for new guidelines when there is a need for significant changes to the Guidelines, however at least every four years. The Board of Directors’ proposal is prepared by the Remuneration Committee. The Chairman of the Board of Directors may also be Chairman of the Remuneration Committee. In order to manage conflicts of interest, other members of the Remuneration Committee who are elected by the Annual General Meeting must be independent in relation to the company and the members of the executive management.

The Remuneration Committee shall, inter alia, monitor and evaluate the application of these Guidelines resolved by the Annual General Meeting. When the Remuneration Committee has prepared the proposal, it is submitted to the Board of Directors for decision. The CEO or other members of the executive management shall not be present while the Board of Directors addresses issues related to remuneration and passes resolutions about them, insofar as they are affected by the issues.

If the General Meeting resolves not to adopt guidelines when there is a proposal for such, the Board of Directors shall submit a new proposal no later than at the next Annual General Meeting. In such cases, remuneration shall be paid in accordance with the current Guidelines or, if no guidelines exist, in accordance with the company’s practice.

External advisors are used in the preparation of these matters when deemed necessary.

Review of the Guidelines

The guidelines were reviewed ahead of the Annual General Meeting on May 7, 2025, and the review has resulted in certain minor editorial changes. The aforementioned changes are not expected to entail any significant change in the remuneration paid in accordance with the current guidelines.