CEO AND EXECUTIVE MANAGEMENT
The CEO’s responsibilities are regulated at various levels. By legislation the CEO’s responsibilities are mainly regulated in the Swedish Companies Act. According to the Swedish Companies Act, the CEO shall attend to the day-to-day management according to the guidelines and instructions set out by the board. In addition, the CEO shall take all measures necessary in order to maintain the Company’s accounting according to applicable laws and regulations and to have an adequate asset management.
The CEO shall comply with the Code and Nasdaq First North - Rulebook, as well as other Swedish and foreign laws and regulations, as applicable.
The CEO must also adhere to the Company’s articles of association, directions given by the general meeting, the instructions for the CEO, including instructions for financial reporting, and other internal directions and guidelines established by the board of directors. The division of work between the board of directors and the CEO is described in the instructions for the CEO, including instructions for financial reporting. The CEO reports to the board of directors and is responsible for the operational management of the Company and to execute the resolutions passed by the board of directors. The CEO shall control and monitor that the matters to be dealt with by the board of directors according to applicable legislation, the articles of association or internal instructions are presented to the board of directors, and shall continuously keep the chairman of the board of directors informed about the performance of the Company’s operations, its earnings and financial position, as well as any other events, circumstances or conditions that cannot be assumed to be irrelevant to the board of directors or to the shareholders.
The CEO shall ensure that the Company has issued policies and/or instructions in all main areas of the Company’s operations and that the policies and instructions are communicated and applied within the organisation.
The CEO shall also ensure that the Company has a current authorisation manual that is properly observed and that the Company’s accounting is performed in a way that is compliant with applicable legislation.
The CEO and the other members of the executive management are presented in greater detail in the section “Board of directors, executive management and auditors”.
REMUNERATION FOR THE CEO AND EXECUTIVE MANAGEMENT
Salaries and other employment conditions are to be sufficient for MAG Interactive’s ability to recruit and maintain highly competent members of the executive management. Remunerations within the Company shall be based on the employee’s position, responsibilities and performance. Remuneration for the executive management constitutes a fixed salary, long term incentives and other benefits such as pensions and insurances. Such other benefits can be offered in accordance with the levels and practice which is applied in the country where the member of the executive management is employed and shall not constitute a material part of the total remuneration.
In addition to fixed salary, the members of the executive management team are entitled to variable salary. The variable salary is determined by the board of directors and must be linked to predetermined and measurable criteria and designed with the aim of promoting the Company's value creation and business strategy both in the short term and the long term. Targets for variable salary shall be linked partly to the outcome of specific financial targets for the Company and partly to individual targets attributable to each executive's role and function at the Company. The size of the variable salary shall not exceed SEK 750,000 per executive and financial year.
Furthermore, the annual general meeting may decide to offer long term incentive programmes such as share and share price related incentive programmes. These incentive programmes shall be intended to contribute to long term valuable growth and provide a common interest for value creation for shareholders and employees.
Neither the CEO, nor any of the members of the executive management team, are entitled to any severance pays in the event of termination of the employment.
LONG TERM INCENTIVE PROGRAMS
A total of 959,246 warrants and employee stock options have been issued to employees of the company. This represents a total potential dilution of 3.6%.
The outstanding options and warrants are described below.
Warrants to the CFO and other employees 2017
The extraordinary general meeting held on 28 February 2017 resolved to authorise the board of directors to issue up to 59,676 warrants (adjusted for the subsequent share split the authorisation amounts to 1,193,520 warrants). 324,871 warrants were issued on 1 June 2017 and subscribed for by 43 employees, including the Company’s CFO. The warrants were issued for a price amounting to SEK 3.75 per warrant.
A warrant entitles the warrant holder to one share, and the exercise price is SEK 15 per warrant. The number of shares that each warrant entitles to may, under certain conditions, be recalculated. The exercise period for the warrants is 1 April 2020 to 30 June 2020.
If the maximum number of warrants to subscribe for new shares is exercised, this will result in a total dilution effect corresponding to 1.2 per cent of the total number of shares in the Company. The warrant holder must offer the Company, or a person designated by the Company, to purchase all warrants in the warrant holder’s possession that is not yet vested should the warrant holder, inter alia, commit a material breach of the warrant agreement or employment agreement or if the warrant holder’s employment is terminated by the warrant holder or the employer on or prior to the date falling 36 months after the date of the warrant agreement.
Warrants to the sellers of the shares in Delinquent
The board of directors of MAG Interactive resolved, on a board meeting held on 27 September 2017, in accordance with the authorisation given by the extraordinary general meeting held on 28 February 2017, to issue 144,375 warrants to some of the sellers of the shares in Delinquent (David Bishop, David Amor and Chris Lee). David Amor and David Bishop are employed by the group company MAG Games Limited. (previously Delinquent). The subscription period for the warrants is 1 July 2020 to 30 September 2020. Other terms and conditions are the same as for the warrants to employees as described above.
ESOP to management and other employees 2019
The annual general meeting held on 18 December 2018 resolved to authorise the board of directors to issue up to 526,428 personnel stock options. 490,000 options were issued on 1 March 2019 and subscribed for by 68 employees, including the Company’s CFO and CMO.
Each option entitles the holder to one share, and the exercise price is SEK 30 per share. The number of shares that each warrant entitles to may, under certain conditions, be recalculated. The exercise period for the options is 1 March 2022 to 30 June 2022.
All warrants and options are subject to a three year vesting scheme, meaning that for each 12 months period one third of the programs options/warrants are vested.