Remuneration guidelines for the CEO and other senior managers

Remuneration issues are considered by the Board of Directors’ Remuneration Committee, and approved by the Board of Directors. The Board of Directors presents proposed guidelines for remunerating senior managers, which the AGM then resolves on. The AGM 2021 adopted the following guidelines for remunerating the CEO and other senior managers.

The Board of Directors intends to propose the same guidelines to the AGM 2022, albeit with the exception that the variable compensation portion is increased from 25 to 50% of basic yearly salary. The motivation for this is to facilitate the company’s appointment of key staff, primarily in the US.

Scope and applicability of the guidelines

These guidelines cover the company’s CEO and the individuals that are members of Senzime’s Management from time to time. To the extent Directors of the company render service to the company in addition to their directorships, these guidelines should also apply to any compensation paid to a Director for such service. The guidelines should be applied to compensation that is agreed, and to amendments to previously agreed compensation, subsequent to adoption of the guidelines at the AGM 2022. Compensation includes the transfer of securities, and of rights to acquire securities from the company in future. The guidelines do not cover compensation resolved by shareholders’ meetings, such as share-based incentive programs. Executives that serve as a Director or Deputy Director on the Boards of group companies should not receive special compensation for this service.

Contribution of the guidelines to the company’s business strategy, long-term interests and sustainability

Senzime is a Swedish medical device company that develops and markets CE and FDA-approved monitoring systems for patients undergoing anesthesia. Senzime’s professionals worldwide are committed to the vision of a world without anesthesia-related complications. Six out of ten patients that waken after surgery do not regain full muscular function, so are at risk of being affected by CREs (critical respiratory events). The TetraGraph® system helps health care staff to improve patient care and reduce the cost of care by digitally and continuously monitoring the level of neuromuscular blockade during and after surgery. Senzime operates on the world’s major markets, and addresses yearly market potential of over SEK 15 billion. Successful implementation of the company’s strategy and protecting the company’s long-term interests require the company to hire and retain Management with good skills and capability of achieving designated targets. This requires the company to offer competitive compensation. These guidelines contribute to the company’s business strategy, long-term interests and sustainability by providing the company with the opportunity to offer senior executives and management competitive compensation.

Forms of compensation

The company’s compensation system should be on market terms and competitive. Compensation may be paid in the form of basic salary, variable compensation, pension and other benefits

Basic salary

Should be individualized for each manager and based on the position, responsibilities, skills, experience and performance of the manager. The senior manager may be offered the opportunity to rebalance between basic salary and pension, as well as other benefits, providing this is cost neutral for the company.

Variable compensation

Should relate to the outcome of the company’s targets and strategies, and should be based on predetermined and measurable criteria designed to promote long-term value creation. It should be possible to alter the share of total compensation that is variable depending on position. For the CEO and the rest of senior management, variable compensation may be a maximum of 25% of yearly basic salary. Variable compensation should not be pensionable, to the extent this does not otherwise ensue from mandatory collective bargaining provisions. The Board of Directors should be able to wholly or partly reclaim variable compensation paid erroneously pursuant to law or contract, subject to the ensuing limitations.

Pension benefits

Should be defined contribution, to the extent the manager is not covered by defined benefit pension pursuant to mandatory collective-bargaining provisions. The pension premiums for defined contribution pensions may be a maximum of 40% of the senior manager’s yearly basic salary.

Other benefits

May include company cars, corporate health care, life and health care insurance, as well as other similar benefits. Other benefits should represent a minor portion of total compensation and may be a maximum of 10% of the senior manager’s yearly basic salary.

Consulting fees

Should be on market terms. Where consulting services are rendered by Directors of the company, the relevant Director is not entitled to participate in the Board of Directors’ (or Remuneration Committee’s) consultation on matters relating to compensation for the relevant consulting services.

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