Statement on Digia Management Emoluments

This management emolument statement sets forth a summary of the financial benefits, remuneration system and thereto related decision-making pertaining to Board members and operative management of Digia Plc.

Board Emoluments

The Shareholders' Meeting decides on emoluments payable to the Board of Directors and grounds for the compensation of expenses. The 2011 AGM decided to pay monthly emoluments of EUR 2,500 to Board members, EUR 3,500 to the Vice Chairman and EUR 5,500 to the Chairman for their work on the Board. In addition, the AGM approved EUR 500 in fees per Board or committee meeting for all Board members. Moreover, the Shareholders’ Meeting decided that standard and reasonable costs resulting from work on the Board would be reimbursed against invoice.

In the 2011 financial year, a total of EUR 317,500 was paid in emoluments to the members of the Board of Directors for their work on the Board, as follows:

Pertti Kyttälä EUR 75,300
Martti Mehtälä EUR 50,400
Robert Ingman EUR 37,400
Kari Karvinen EUR 39,300
Pekka Sivonen EUR 38,400
Tommi Uhari EUR 37,900
Marjatta Virtanen EUR 38,800

All emoluments were monetary. The company does not grant stock options or share-based remuneration for work on the Board.

Emoluments of the CEO and other management

Summary of the CEO remuneration system

The Board of Directors decides on the CEO’s salary, and other remuneration and benefits.

CEO Varelius’s remuneration package comprises a monthly salary in accordance with his director agreement and the bonus possibly payable pursuant to CEO’s share incentive scheme.

CEO’s regular monthly salary is based on a target salary model comprising a fixed and variable parts. According to said model the remuneration finally payable to the CEO is linked to the company’s profitability and revenue targets set by the Board for each quarter respectively. In the event the set targets are not met, the agreed target salary will be reduced accordingly by a maximum of 17 percent variable part. On the other hand, exceeding the set targets will lead to remuneration above the target level.

CEO’s share-based remuneration plan was decided by the Board pursuant to authority given by the AGM in in Spring 2010.

The scheme has four earning periods, which are years 2010-2013. The scheme provides the CEO with a possibility to earn a maximum bonus equal to the value of 100,000 shares in each earning period 2011-2013 respectively pursuant to the earning criteria to be annually decided by the Board for the respective earning period. Regarding year 2012 the bonus shall be determined based on the earning per share (EPS) and revenue of the company. The minimum bonus (5,000 shares) requires an EPS of EUR 0,21 and revenue of EUR 92,0 million. Maximum bonus (100,000 shares) will become payable if the EPS amounts to a EUR 0.32 accompanied by a revenue of EUR 100,0 million or if the EPS amounts to a EUR 0.23 accompanied by a revenue of EUR 122,0 million.

Based on the results of financial year 2011 the CEO will be paid with a total bonus equal to the value of 39,266 company shares in connection with the April 2012 salary payment.

Bonuses payable under said scheme will be paid in a 50/50 combination of shares and cash after the adoption of the financial statements following the close of the respective earning period. The cash payment is used primarily to cover taxes and other applicable fees and levies incurred from the bonus payment. The scheme includes no lock-up periods designed to restrict the disposal of shares already granted to the CEO.

Share bonuses paid in 2011 have been paid pursuant to an agreement on management of company’s share bonus schemes by Evli Alexander Management Ltd. Payments have been made with shares managed by Evli, which the company has financed to be acquired for the purpose of being used for management incentives.


CEO Financial benefits and main terms of service
In 2011 the CEO was paid EUR 595,736 in salary and benefits, of which salary and fringe benefits account for EUR 345,176 and bonuses for EUR 250,560.

The company may terminate the CEO’s service contract with six months’ notice. Upon such termination, he will receive remuneration for the notice period plus severance pay equalling 12 months’ salary. The CEO’s retirement age is as stipulated by law, and he has no supplementary pension agreement with the company.

Summary of the remuneration system of other management
Based on a proposal submitted by the CEO, the Board of Directors decides on the salary, other remuneration and other benefits to be paid to members of the Group Management Team (GMT).

GMT members’ total remuneration package comprises a monthly salary and the bonus possibly payable pursuant to two share incentive schemes.

As with the CEO’s pay, the Management Team members’ pay is based on a target salary model, where 85 per cent of the salary is fixed and a 17 per cent portion is linked to the company’s profitability and revenue targets set by the Board for each quarter respectively.

In addition to the monthly salary the GMT members will receive, in each January of years 2010-2013 respectively, a bonus decided by the Board in 2009 based on the results of said accounting period. The bonus amounting to an aggregate total value of 79,000 shares will be paid in four equal slots assuming that the recipient is still employed by the company on each payment date.

Moreover, the GMT members accompany the CEO in the share incentive scheme decided by the Board in Spring 2010 and covering the earning periods of 2010-2013. The maximum total bonus payable for the GMT members in aggregate under the scheme amounts to the value of 100,000 shares in 2011-2013 respectively. Bonuses shall be payable against the same earning criteria as for the CEO. Based on the results of financial year 2011, the GMT members will be paid with a aggregate total bonus equal to the value of 39,266 company shares in connection with the April 2012 salary payment.

All bonuses payable under both of said schemes will be paid in a 50/50 combination of shares and cash. The cash payment is used primarily to cover taxes and other applicable fees and levies incurred from the bonus payment. The schemes include no lock-up periods designed to restrict the disposal of shares already granted to the GMT members.

Share bonuses paid in 2011 have been paid pursuant to an agreement on management of company’s share bonus schemes by Evli Alexander Management Ltd. Payments have been made with shares managed by Evli, which the company has financed to be acquired for the purpose of being used for management incentives.

Each Management Team members’ retirement age is stipulated by law, and no member has a supplementary pension agreement with the company.