Compensation of Members of the Management Board
GPC Biotech has entered into service agreements with all current
members of the Management Board. These agreements generally provide for a base salary and an annual bonus. Company goals are set by the Supervisory Board together with the Management Board for each year and are an important basis for assessing achievement of the variable component of each member’s compensation. Additionally, each year personal goals are agreed to between the individual members of the Management Board and the Supervisory Board. Towards the end of each evaluation period, the Supervisory Board evaluates and
assesses the goals and specifies the bonus, or variable compensation component, if any, for each member of the Management Board. In addition to these fixed and variable remuneration components, the members of the Management Board are entitled under the terms of their service agreements to specific insurance benefits (including accident and D&O insurance) and to reimbursement of necessary and reasonable disbursements. The Company does not have a pension plan for its Management Board or for its employees.
Furthermore, Dr. Seizinger, the Chairman of the Management Board, is entitled to severance benefits in the amount of 200 percent of the sum of his last annual salary and the average of his last two annual bonuses in the event that the Supervisory Board determines to terminate his appointment as Chairman of the Management Board and not to extend his service agreement beyond its current term. The other members of the Management Board are entitled to severance benefits in the amount of 100 percent of their respective last annual salaries in the event that the Supervisory Board determines not to renew their respective service agreements beyond their current term.
The Company believes that the service agreements between
GPC Biotech and the members of the Management Board provide
for payments and benefits that are in line with customary market
practices. Other than the Supervisory Board seats listed in
the Notes to the Consolidated Financial Statements, the members
of the Management Board did not enter into additional service
agreements with other companies. Furthermore, no member of the Management Board holds a material share in another company.
Detailed information on the compensation of the Management
Board can be found in the Notes to the Consolidated Financial
Statements. This includes information on the Board’s stock options or comparable compensation components that have a long-term incentive effect and risk elements.
Compensation of Members of the Supervisory Board
The Company’s Articles of Association provide that the Chairmanof the Supervisory Board shall receive an annual fixed remuneration of € 35,000 in cash, that the Vice Chairman receive an annual fixed remuneration of € 25,000 in cash and that all other members of the Supervisory Board shall receive an annual fixed remuneration of € 15,000 in cash. Members of the Company’s Supervisory Board who serve on Supervisory Board committees receive cash-based remuneration in addition to their annual fixed remuneration as follows: for activity as chairman of one or more committees (other than the Audit Committee), a member of the Supervisory Board receives an additional € 5,000 (plus any value added tax on such amount) annually, and, for activity as a member of a committee (other than the Audit
Committee), a member of the Supervisory Board receives an additional € 2,500 (plus any value added tax on such amount) annually. The chairman of the Audit Committee receives an additional € 10,000 (plus any value added tax on such amount) annually and the other members of the Audit Committee each receive an additional € 5,000 (plus any value added tax on such amount) annually. The members of the Audit Committee do not receive any additional cash-based remuneration for their service on any other committee. m
Pursuant to the Company’s Corporate Governance Principles, the
granting of loans to members of the Supervisory Board is not permitted. Pursuant to Section 114 of the German Stock Corporation Act, GPC Biotech may not enter into advisory contracts or service agreements with members of the Supervisory Board unless such contract or agreement is approved by the full Supervisory Board. More detailed information on the different parts of compensation of the Supervisory Board can be found in the Notes to the Consolidated
Financial Statements.
For detailed information on compensation of the boards, please see tables in Annual Report 2007 on page 20 and in the Notes to the Consolidated Financial Statements as well as in the section Shareholdings of the Boards of this Web site. This includes information on the Board’s stock options or comparable compensation components that have a long-term incentive effect
and risk elements.
Equity-Based Compensation
GPC Biotech grants stock options to the Management Board, senior management, employees and, in the past, to consultants. Under the terms of the stock option plans, options are exercisable within ten years of the date of grant, subject to an initial two-year non-exercise period as required by German law. The exercise price equals the average of the market price of the ordinary bearer shares over a five-day period prior to the date of grant. The options vest at 25 % per year over a four-year period. The Company also grants convertible bonds to the Management Board and senior management. In the past, convertible bonds were also granted to the Supervisory Board.
For detailed information, please see tables in Annual Report 2007 on page 22.
