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Rules for determining the remuneration of Members of JSW's Management Board were adopted through a decision by JSW's Extraordinary General Meeting and a decision by the Supervisory Board in accordance with the regulations specified in the Act on rules for determining remuneration for persons managing certain companies.
Management service contracts with Management Board members are signed for a definite term and will remain in force until the end of the current term of the Management Board, i.e. until the date of the Ordinary General Meeting approving the financial statements for 2018. These contracts provide for the obligation to render services personally even if the Manager is acting within the framework of his/her own business activity.
The amount of monthly Fixed Remuneration for Management Board Members is set by the Supervisory Board, subject to the following General Meeting provisions:
In accordance with a decision by the Supervisory Board, for rendering management services and performing other duties resulting from the contract, the Manager is entitled to Total Remuneration consisting of the following:
a) Monthly (per calendar month) lump-sum base remuneration (Fixed Remuneration):
Fixed Remuneration also includes remuneration for the transfer of copyright and for the performance of other obligations arising from the contract.
b) Supplementary remuneration for the relevant financial year (Variable Remuneration) contingent on the degree of achievement of management objectives, which may not exceed 100% of annual Fixed Remuneration.
Fixed Remuneration and Variable Remuneration are payable after deduction, by JSW as payer, of the applicable public-law levies subject to payment to the relevant authorities in respect of the Manager. If the applicable provisions of law require that, despite the fact that the Manager does not run his/her own business activity, Fixed Remuneration, Variable Remuneration or benefits payable by virtue of severance pay or non-competition clauses are subject to VAT at the applicable rate, such VAT will be added on top of the amount in question. Should the Manager be required to pay VAT for any past periods, JSW undertakes to pay to the Manager an amount equal to such tax arrears, together with interest.
Fixed Remuneration is payable within 7 days of the date of delivery of a properly issued bill to JSW. If the contract is in force for a shorter period than a full calendar month or if the Manager is unable to render his/her services in an uninterrupted manner, as provided for in the contract, Fixed Remuneration will be calculated on a pro rata basis.
The Manager will also be entitled to Variable Remuneration if he/she performs the contract for a period of less than one full financial year but for at least 3 months in the relevant financial year, in which case Variable Remuneration will be calculated on a pro rata basis. The pro rata calculation will depend on the number of days of the Manager’s provision of services in the relevant financial year. The Supervisory Board determines (to an extent consistent with remuneration-related decisions by the General Meeting) the maximum Variable Remuneration for a given financial year, the Management Objectives for a given financial year and the method for evaluating their achievement. A general set of Management Objectives is outlined in a resolution adopted by the General Meeting, and the Supervisory Board is authorised by the General Meeting to define them precisely, assign weights to such objectives and define objective and measurable criteria of their achievement and settlement.
Variable Remuneration will be paid out provided that the Manager fulfils his/her Management Objectives, after the Management Board report on JSW’s operations and the financial statements for the preceding financial year are approved and the Manager receives a discharge on the performance of his/her duties as a Management Board Member by the General Meeting in accordance with the provisions of the contract. Variable Remuneration, provided that it is due, will be paid within 7 days from the date of delivery to JSW of a correctly issued bill by transfer to a bank account indicated by the Manager. In accordance with a decision of the General Meeting, payment of a portion of Variable Remuneration may be deferred for a period not to exceed 36 months, depending on fulfilment of conditions by the specified deadline according to the designated Management Objectives, in which case that portion of Variable Remuneration may be paid out in full or partially at the end of the settlement period.
JSW is entitled to put forward a claim for reimbursement (in full or in an appropriate part) of the disbursed Variable Remuneration if, following such disbursement, it becomes apparent that Variable Remuneration (in whole or in an appropriate part, as the case may be) was granted to the Manager on the basis of data that subsequently turned out to be incorrect.
| FIRST AND LAST NAME | PERIOD | REMUNERATION | MANAGEMENT SERVICES* | ANNUAL BONUS FOR 2018** |
BENEFITS, INCOME FROM OTHER SOURCES*** |
INCOME EARNED IN SUBSIDIARIES | TOTAL |
|---|---|---|---|---|---|---|---|
| Daniel Ozon | 01.01.-31.12.2018 | – | 720,000.00 | – | – | – | 720,000.00 |
| Artur Dyczko | 01.01.-31.12.2018 | – | 600,000.00 | – | – | – | 600,000.00 |
| Tomasz Śledź | 01.01.-31.12.2018 | – | 600,000.00 | – | – | – | 600,000.00 |
| Robert Ostrowski | 01.01.-31.12.2018 | – | 600,000,00 | – | – | – | 600,000.00 |
| Jolanta Gruszka | 01.01.-31.12.2018 | – | 600,000.00 | – | – | – | 600,000.00 |
| Artur Wojtków | 01.01.-31.12.2018 | – | 600,000.00 | – | – | – | 600,000.00 |
| TOTAL | – | 3,720,000.00 | – | – | – | 3,720,000.00 |
* This item includes only the cost of remuneration based on management contracts.
** This item includes the annual bonus depending on the attainment of management objectives. By the date of preparation of these statements, the Supervisory Board has not adopted a resolution on the degree of fulfillment of management objectives and the amount of the 2017 annual bonus contingent on them.
*** This item includes benefits payable after the expiration of the management contract (compensation for the notice period for management services, severance pay, compensation for refraining from competitive activity).
A non-compete clause during the contract term is defined in the management contract and the Manager is not entitled to any additional remuneration for refraining from competing activity.
The management contracts signed with Management Board Members also include provisions prohibiting competing activity after the contract termination.
The Manager additionally undertakes, after the contract is terminated, if he has discharged the function for a period of at least 6 months from the date of the Manager’s appointment to JSW’s Management Board, not to conduct any competing activity as defined in the contract over the period of 6 months from the date he/she ceases to perform his/her function.
The Manager is entitled to remuneration for complying with the non-compete clause after the function ends, in a total amount equal to 0.5 times the monthly Fixed Remuneration x 6. This remuneration will be payable in 6 monthly instalments, each by the 10th day of the following month. The payment of remuneration is conditional upon a written representation of the Manager confirming compliance with the non-compete clause after the function ended, delivered to JSW in writing by the 5th day of the month following the month for which the remuneration is due.
The non-compete clause after the function ends does not apply if, before the end of the term of the clause, the Manager undertakes to perform a function in JSW or JSW’s subsidiary belonging to the Group. In such a case, the entitlement to remuneration expires on the day the manager takes up the function.
A non-compete agreement may be terminated at any time by the parties’ agreement or by JSW with a one-month notice period. The agreement and the termination notice must be in writing in order to be valid. The contract ceases to be in force if JSW fails to comply with its duty to pay the remuneration, on the date that the payment term for this remuneration instalment to which JSW’s delay refers lapses. The contract in the part concerning the non-compete clause may be also terminated with immediate effect at any time upon a written notice submitted by JSW in the event of a gross violation of the non-compete clause by the Manager after his function ends. If the non-compete clause ends in the event of contract termination, the remuneration is due and payable in the appropriate proportion.
If the non-compete clause is violated while it is still in force but after the function ends, the clause ceases to be in force and JSW has the right to demand payment of a contractual penalty from the Manager in the amount of 100% of remuneration within 14 days of receipt of JSW’s summons by the Manager.
The payment of this contractual penalty does not preclude JSW’s right to pursue damages in excess of the contractual penalty on general terms.
Rules for determining the remuneration of Supervisory Board Members were adopted through a decision by JSW’s Extraordinary General Meeting in accordance with the regulations specified in the Act on rules for determining remuneration for persons managing certain companies.
Monthly remuneration for Supervisory Board Members is set as the product of the average monthly salary in the corporate sector net of profit-sharing in the fourth quarter of the previous year, as announced by the President of the Central Statistical Office, and the following multiplier:
Supervisory Board Members are entitled to receive remuneration regardless of the number of meetings convened. Supervisory Board Members are not entitled to any remuneration for a month in which they did not attend any of the correctly convened meetings and their absence was not excused. The Supervisory Board decides by way of a resolution whether the absence of a Supervisory Board Member at a meeting was justified or not. Supervisory Board Members shall be entitled to reimbursement of expenses incurred in connection with participating in the works of the Supervisory Board.
| FIRST AND LAST NAME | PERIOD IN OFFICE | REMUNERATION | OTHER INCOME | TOTAL |
|---|---|---|---|---|
| Halina Buk | 01.01.-31.12.2018 | 57,391.22 | – | 57,391.22 |
| Eugeniusz Baron | 01.01.-28.06.2018 | 26,129.09 | – | 26,129.09 |
| Tomasz Lis | 01.01.-31.12.2018 | 52,845.36 | – | 52,845.36 |
| Robert Kudelski | 01.01.-31.12.2018 | 52,845.36 | – | 52,845.36 |
| Krzysztof Kwaśniewski | 01.01.-22.10.2018 | 42,617.23 | – | 42,617.23 |
| Antoni Malinowski | 01.01.-31.12.2018 | 52,845.36 | – | 52,845.36 |
| Alojzy Zbigniew Nowak | 01.01.-31.12.2018 | 52,845.36 | – | 52,845.36 |
| Andrzej Palarczyk | 01.01.-28.06.2018 | 26,129.09 | – | 26,129.09 |
| Adam Pawlicki | 01.01.-31.12.2018 | 52,845.36 | – | 52,845.36 |
| Konrad Balcerski | 22.10.-31.12.2018 | 10,228.13 | – | 10,228.13 |
| Arkadiusz Wypych | 18.01.-31.12.2018 | 50,430.38 | – | 50,430.38 |
| Paweł Bieszczad | 28.06.-31.12.2018 | 26,863.06 | – | 26,863.06 |
| Tadeusz Kubiczek | 28.06.-31.12.2018 | 26,863.06 | – | 26,863.06 |
| TOTAL | 530,878.06 | – | 530,878.06 |
Management service contracts entered into with Management Board Members do not contain provisions concerning liabilities under pensions and similar benefits.
No separate agreements are executed with Management Board Members providing for remuneration if they resign, are dismissed or terminated. These issues are addressed in their management services contracts. In accordance with the provisions of these contracts:
If the contract is dissolved or terminated by JSW for reasons defined in sec. 1 above, the Manager is eligible for severance pay amounting to 3 times the Fixed Remuneration, provided that the Manager had performed his/her function for at least 12 months before the agreement was terminated.
The severance pay is not due if:
Severance pay is payable within 7 days of the date on which JSW receives a correctly issued bill, to the bank account specified by the Manager.
If the function performed by the Manager on the Management Board changes during the term of the contract, the Parties undertake to sign an annex to adapt the content of the contract to the Manager’s new function.