Riktlinjer för ersättning till ledande befattningshavare

These guidelines cover senior executives in Starbreeze AB, who are made up of those who form part of the company's management team from time to time. The guidelines must be applied to compensation that is agreed, and changes that are made to already agreed compensation, after the guidelines have been adopted by the annual general meeting. The guidelines do not cover compensation decided by the general meeting.

Regarding employment relationships that are subject to rules other than Swedish, appropriate adjustments may be made to comply with mandatory such rules or local practice, whereby the overall objectives of these guidelines must be met.

The guidelines' promotion of the company's business strategy, long-term interests and sustainability

Starbreeze must offer market-based conditions that enable the company to recruit and retain competent personnel.

Variable compensation covered by these guidelines must aim to promote the company's business strategy and long-term interests, including its sustainability.

The forms of compensation etc.

The remuneration to the company management can consist of fixed salary, variable remuneration, pension and other customary benefits. In addition, the board must annually evaluate whether share-related or share-price-related incentive programs should be proposed to the annual general meeting. Such share-related or share price-related incentive programs are decided by the general meeting and are therefore not covered by these guidelines.

As a general rule, the fixed salary is reviewed once a year and must take into account the individual's qualitative performance. The remuneration to the managing director and other senior executives must be in line with the market.

The board shall also have the right to decide on variable compensation in the form of cash bonuses for the Company's senior executives. The variable compensation must be linked to predetermined and measurable criteria. The variable compensation on an annual basis may amount to no more than 75 percent of the fixed annual salary for the CEO and 50 percent of the fixed annual salary for other senior executives.

For the managing director and senior executives, defined contribution pension premiums are paid which correspond to the cost according to the customary ITP plan.

Other customary benefits may total no more than 10 percent of the fixed annual salary.

Regarding employment relationships that are subject to rules other than Swedish, due adjustments may be made, as far as pension benefits and other benefits are concerned, to comply with mandatory such rules or local practice, whereby the overall purposes of these guidelines must be met.

Termination of employment

In the event of dismissal by the managing director, there is a mutual notice period of six months. Fixed salary during the notice period and any severance pay for the managing director must not exceed an amount corresponding to the fixed salary for 12 months. In the event of termination by the CEO, no severance pay shall be paid. Other senior executives must have a notice period of three to nine months, without the right to severance pay.

In addition, compensation for any commitment regarding restriction of competition may be paid out. Such compensation shall compensate for any loss of income and shall only be paid to the extent that the former executive is not entitled to severance pay. The compensation must amount to a maximum of 60 percent of the fixed cash salary at the time of termination, unless otherwise follows from mandatory collective agreement provisions, and will be paid during the time that the commitment to restrict competition applies, which must be a maximum of 18 months after the termination of employment.

Salary and employment conditions for employees

In the preparation of the board's proposal for these remuneration guidelines, salary and employment conditions for the company's employees have been taken into account in that information on employees' total remuneration, the components of the remuneration as well as the increase and rate of increase of the remuneration over time have formed part of the decision-making basis of the remuneration committee and the board when evaluating the fairness of the guidelines and the limitations which follows from these.
The decision-making process for establishing, reviewing and implementing the guidelines

The board has established a remuneration committee. The committee's duties include preparing the board's decision on proposals for guidelines for remuneration to senior executives. The board must draw up proposals for new guidelines at least every four years and submit the proposal for decision at the annual general meeting. The guidelines shall apply until new guidelines are adopted by the general meeting. The remuneration committee must also monitor and evaluate programs for variable remuneration for company management, the application of guidelines for remuneration to senior executives and current remuneration structures and remuneration levels in the company. In the board's consideration of and decisions on remuneration-related matters, the CEO or other persons in the company's management are not present, to the extent that they are affected by the matters.

Departing from the guidelines

The board has the right to depart from the above guidelines in whole or in part if the board judges that in an individual case there are special reasons that justify it and a departure is necessary to satisfy the company's long-term interests, including its sustainability, or to ensure the company's financial viability. As stated above, the remuneration committee's tasks include preparing the board's decisions on remuneration matters, which includes decisions on deviations from the guidelines.