Compensation

Executive Board Compensation

The remuneration of the members of the Executive Board consists of three components: an annual fixed salary, a performance-related bonus and a payment linked to the Company’s longterm performance and share price (long-term incentive plan).

The annual fixed salary amounts to €674 thousand for the Chairman and €449 thousand for full members of the Executive Board. The remuneration of newly appointed members is at first reduced by 20 percent. This applies to Mr. Raps (until the end of March 2009), Mr. Müller (until the end of April 2009) and Mr. Töpfer (until the end of March 2011). In addition to the fixed salary, the members of the Executive Board also receive fringe benefits (benefits in kind) for the most part in the form of insurance cover and the use of company cars, the value of which is shown in accordance with applicable tax law.

Variable remuneration is calculated according to a profit-sharing model, by which all full members of the Executive Board receive €2,400 and the Chairman receives €3,600 per €1 million of earnings before taxes (EBT) achieved by the Group. As is the case with the annual fixed salary, the bonus for newly appointed members of the Executive Board is reduced by 20 percent during the periods described above under Annual fixed salary. The amount of bonus paid out is limited by a cap of €640 thousand for newly appointed members and €800 thousand for the other full members of the Executive Board and €1,200 thousand for the Chairman. Furthermore, the bonus thus calculated can be reduced by up to 20 percent if EBT is significantly increased by non-periodic earnings.
 

The component of remuneration with a longterm incentive effect is calculated in accordance with a long-term incentive plan (LTI), which has the following main features: If the value added achieved in a certain year exceeds the agreed minimum for that year, the members of the Executive Board are granted phantom shares in the form of so-called performance share units (PSUs). Value added is defined as the difference between return and the cost of capital. Return is calculated as EBIT plus amortization of intangible assets from acquisitions, net interest income and the growth in value of the portfolio of concession projects. The cost of capital is arrived at by multiplying capital employed (average for the period) by the weighted average cost of capital (see page 204). The value of the PSUs granted varies during a waiting period of two years in line with the development of Bilfinger Berger’s share price. Upon expiry of the waiting period, the value of the PSUs at that time is paid out.

For Mr. Bodner and Professor Schetter, payment is made after a waiting period of two years, with 65 percent paid in cash (taxable) and 35 percent paid in the form of Bilfinger Berger shares,which may not be sold until another two-year lockup period has elapsed. A four-year waiting period has been set in the LTI for Mr. Müller, Dr. Ott, Mr. Raps, Mr. Reid and Mr. Töpfer, after which the total value of the PSUs is paid out in cash (after taxes).

If the minimum value added agreed upon for a year is not achieved during the waiting period, this leads to the allocation of negative PSUs, reducing the number of PSUs already held (this applies to Mr. Bodner and Professor Schetter), or PSUs credited are cancelled (this applies to Mr. Müller, Dr. Ott, Mr. Raps, Mr. Reid and Mr. Töpfer). If Bilfinger Berger’s shares underperform compared with the MDAX during a waiting period, the award of PSUs can be reduced by up to 20 percent. There is also a cap (for the Chairman €551 thousand; for a full member €368 thousand; for newly appointed members during the waiting periods specified under Annual fixed salary €294 thousand), which limits the payment under the LTI to an absolute maximum annual amount.

Supervisory Board Compensation

As specified by Article 14 of Bilfinger Berger’s Articles of Incorporation the remuneration of the members of the Supervisory Board comprises an annual fixed payment of €40 thousand and an annual variable payment of €300 for each cent by which the dividend exceeds €0.80 per share. The Chairman of the Supervisory Board is paid double these amounts, the chairmen of the committees with the exclusion of the committee established pursuant to Section 27, Subsection 3 of the German Codetermination Act and of the Nomination Committee receive one and three quarters times these amounts. The Deputy Chairman of the Supervisory Board and the members of the committees with the exclusion of the committee established pursuant to Section 27, Subsection 3 of the German Codetermination Act and of the Nomination Committee receive one and a half times these amounts. If a member of the Supervisory Board exercises several of the aforementioned functions, he or she is only entitled to the highest of the respective amounts.

In addition, expenses were reimbursed in a total amount of €40 thousand (2008: €43 thousand). The total remuneration of the members of the Supervisory Board for the 2009 financial year thus amounted to €1,769 thousand (2008: €1,651 thousand).

The members of the Supervisory Board received no remuneration or other advantages for personal services rendered such as consulting or agency services.