CORPORATE GOVERNANCE

Cicor Technologies Ltd. is committed to meeting the high standards of Corporate Governance that seek to balance entrepreneurship, control and transparency whilst ensuring efficient decision-making processes.

This report explains how the management and control of the Company are organized and provides background information on the Group’s executive officers and bodies, effective 31 December 2021. The report complies with the SIX Swiss Exchange Directive on Information relating to Corporate Governance. In addition, the report considers Cicor Technologies Ltd.’s Articles of Incorporation as well as the Company’s organization regulation.

In the following Corporate Governance Report, the terms “Cicor” and “Company” shall be used alternatively to “ Cicor Technologies Ltd.” and the term “Group” for the company and its subsidiaries.

1.1 GROUP  STRUCTURE

Cicor Technologies Ltd. is registered in Boudry, Switzerland, and is operationally organized into the AMS and ES Divisions. Cicor Technologies Ltd. is the parent company and is listed on the SIX Swiss Exchange.

1.2 PRINCIPAL SHAREHOLDERS

The following shareholdings correspond to the ones reported according to the regulations of the Swiss Stock Exchange (SIX Swiss Exchange) and updated as in the shares register per year-end:

* in % of the total outstanding shares of the company
 

Cicor Technologies Ltd. has received no notice of any shareholders’ agreement regarding its shares.

As of 31 December 2021, a total of 1 ,009 (previous year 1 ,064) shareholders with voting rights were registered in the share register of Cicor Technologies Ltd.

1.3 CROSS-SHAREHOLDINGS

Cicor Technologies Ltd. has no cross-shareholdings with any other company exceeding a reciprocal 3% of capital or voting rights.

2.1 ORDINARY CAPITAL

As of 31 December 2021, the ordinary share capital of Cicor Technologies Ltd. is CHF 30 695 420 divided into 3 069 542 fully paid-in registered shares with a par value of CHF 10 each.

As of 31 December 2021, the company held 116 (previous year: 116) of its own shares as treasury shares. For a detailed overview, please refer to section 18 of the notes to the consolidated financial statements.

2.2 AUTHORIZED AND CONDITIONAL CAPITAL

Authorized capital

At the Annual General Meeting of Shareholders’ on 16 April 2020, the shareholders decided to renew the authorization of the Board of Directors to increase the share capital by a maximum of 600 000 fully paid-in shares at a nominal value of CHF 10 until 16 April 2022. 167 450 of those shares were used for the capital increase as of 30 November 2021 in connection with the purchase of Axis EMS Heights Ltd. and its subsidiaries.

Conditional capital

At the Annual General Meeting of Shareholders’ on 13 May 2009, the shareholders decided to increase the conditional share capital up to 200 000 fully paid-in registered shares with a total nominal value up to CHF 2 000 000 for the exercise of stock option rights granted to officers and other key employees under an employee stock option plan established by the Board of Directors. As of 31 December 2021, 120 670 shares have not been used. At the Extraodrinary General Meeting of Shareholders’ on 16 December 2021, the shareholders decided that the share capital of the
Company may be increased by an additional maximum amount of CHF 13 303 750 by issuing up to 1 330 375 fully paid-in registered shares with a nominal value of CHF 10.00 each through the exercise or compulsory exercise of conversion, exchange, option or similar subscription rights granted to shareholders or third parties, alone or in connection with bonds, loans, options, warrants or other financial market instruments or contractual obligations, subscription or similar share subscription rights, granted to shareholders or third parties, alone or in connection with bonds,
loans, options, warrants or other financial market instruments or contractual obligations of the Company or one of its subsidiaries (hereinafter collectively : financial instruments).

2.4 SHARES AND PARTICIPATION CERTIFICATES

With the exception of the shares held by the Company itself, each ordinary share is entitled to the same share in the Company’s assets and profits and bears one voting right at the Annual General Meeting of Shareholders’, provided the shareholder is registered with voting rights in the Company’s share register. Provided that a shareholder does not request the printing and delivery of share certificates for their investment, the shares of the Company are held in collective deposit at Computershare Schweiz AG rather than being issued as physical certificates. At the request of some shareholders, the Company has issued a number of physical certificates. As of 31 December 2021, the Company has not issued any participation certificates.

2.5 PROFIT-SHARING CERTIFICATES

As of 31 December 2021, the Company has not issued any profit- sharing certificates.

2.6 LIMITATIONS ON TRANSFERABILITY AND NOMINEE REGISTRATIONS

All shares of Cicor Technologies Ltd. are registered shares and freely transferable without any limitation. Entry in the Company’s share register with voting rights requires evidence that the shares have been transferred for ownership or beneficial interest. There are no registration provisions for nominees. The share register is kept by the Computershare Schweiz AG.

2.7 CONVERTIBLE BONDS AND WARRANTS/OPTIONS

The Company has not issued any convertible bonds or similar equity-linked debt instruments as of 31 December 2021. There are currently no stock option plans for members of the management in place.

3.1 MEMBERS OF THE BOARD OF DIRECTORS

3.2 OTHER ACTIVITIES AND VESTED INTERESTS

Information about other activities of the Board members in addition to their functions for Cicor Technologies Ltd. is listed in the table above. Unless otherwise described in the curriculum vitae, the non-executive members of the Board do not have any material business connections with the Group.

3.3 ELECTIONS AND TERMS OF OFFICE

According to the Company’s Articles of Incorporation, the Board consists of one or more members. The members of the Board as well as the Chairman of the Board are elected by the Annual General Meeting of Shareholders’ for a term of office of one year. There are no limits as to how many times a member can be reelected, or any upper age limit for election. According to the Company’s Articles of Incorporation, at least one member must be domiciled in Switzerland.

3.4 INTERNAL ORGANIZATIONAL STRUCTURE

The Board constitutes itself at its first meeting after the Annual General Meeting of Shareholders’ except for the appointment of the Chairman of the Board and the members of the Remuneration Committee. It appoints if necessary its Vice Chairman and the Audit Committee as well as a Secretary, who does not need to be a member of the Board. The Board meets as often as the Company’s affairs require or upon the written request of one of its members. The Board approves resolutions and holds elections with the majority  of its votes.

The Board is the highest executive instance within the Group Management structure and takes responsibility of the overall governance of the Company and the Group. It oversees the management of their affairs. The basic principles regarding the definition of the areas of responsibility  between the Board and the Group Management are described in section 3.5.

The Chairman of the Board of Directors

The Chairman heads the meetings of the Board and the Annual General Meeting of Shareholders’. He supervises the implementation of the resolutions passed by the Board and coordinates the work of the committees ensuring that the Board as a whole operates as an integrated, cohesive body. The current Chairman of the Board of Directors is Daniel Frutig.

The Presidium

The Presidium has been discontinued as of 15 April 2021.

Audit Committee

The Audit Committee shall consist of one or more Board members elected by the Board of Directors. The following members have been appointed:

•  Andreas Dill, Chairman (as from 15 April 2021)
•  Erich Haefeli
•  Norma Corio (as from 16 July 2021)

The Audit Committee assists the Board in supervising the management of the Company, particularly with respect to financial and legal matters as well as in relation to compliance with internal business policies and codes of practice.

Remuneration Committee

In accordance with the Articles of Incorporation, Cicor has a Remuneration Committee that consists of one or more members of the Board of Directors, who are elected individually by the Annual General Meeting of Shareholders’. The following members have been elected:

•  Daniel Frutig, Chairman (as from 15 April 2021)
•  Andreas Dill (Chairman until 15 April 2021)
•  Konstantin Ryzhkov (as from 16 July 2021)
•  Rüdiger Merz (until 16 July 2021)

The roles and responsibilities of the Remuneration Committee are defined in detail by the Board of Directors. More information on their duties is provided in the compensation report.

Operating methods of the Board and the Committees

Between 1 January and 31 December 2021, the Board met for 22 ordinary Board meetings as well as two phone conferences. The CEO and/or the CFO of the Group attended all meetings. On a selective basis, external advisors also participated in some meetings on specific subjects. The meetings of the Board lasted on average six hours. For each Board meeting, the members were provided with adequate material in advance to prepare for the items on the agenda. At each ordinary meeting, the CEO or the CFO presented the results of Cicor Technologies Ltd. and its segments in detail. The members discussed the results comprehensively and, if required, instructed the CEO or the CFO to take necessary actions or to draw up plans for measures. The Audit Committee held three meetings in 2021. The CFO of the Group participated in each conference. In addition, these meetings were attended by the auditor in charge. The meetings lasted on average one hour. The Remuneration Committee held nine meetings in 2021. The meetings lasted on average one hour.

3.5 DEFINITION OF AREAS OF RESPONSIBILITY

The duties and responsibilities of the Board and the Group Management are defined as follows: The Board holds the ultimate decision-making authority and decides on all matters which have not been reserved for or conferred upon another governing body of the Company by law, the Articles
of Incorporation or regulations regarding the delegation of Management of the Company.

The Board has the following non-transferable and indefeasible duties in particular:

 

•  overall governance of the Company and the Group, including formulating medium- and long-term strategies, planning priorities and laying down guidelines for corporate policy;
•  approving the annual Group budgets and medium- to long-term Group business and investment plans;
•  establishing the basic organizational structure;
•  defining the guidelines for accounting, financial controlling and financial planning systems;
•  taking decisions on transactions of substantial strategic significance;
•  appointing and removing those responsible for managing the Company’s affairs and acting as its agent, in particular the CEO, the CFO and other members of the Group Management;
•  appointing and removing the members of the committees of the Board (Remuneration Committee is elected by the Annual General Meeting of Shareholders’);
•  overall supervision of the bodies and officers responsible for the management of the Company;
•  drawing up the annual and interim reports, preparing the Annual General Meeting of Shareholders’;
•  notifying the court in the event of overindebtedness;
•  proposing and implementing capital increases and amending the Articles of Incorporation;
•  checking the professional qualifications of the external Group auditors.

The Board conferred management functions in the manner provided by the organizational regulation to the CEO or the Group Management. Thereby, it follows the Company’s general principle according to which all executive bodies and officers delegate their duties and powers to the hierarchically lowest possible body or officer that possesses the knowledge and expertise necessary to make appropriate decisions. The operational Group Management is responsible for the day-to-day operational business of the Group. Its main duties consist of:

• conducting day-to-day business of the Group in compliance with the applicable laws, Articles of Incorporation, regulations and instructions;
• implementing the Group strategy;
•  preparing and executing the resolutions of the Board and ensuring their Group-wide implementation;
• reporting all matters to be dealt with by the Board and the committees;
• accounting and analyzing of the monthly results and semiannual and annual accounts on Group and divisional levels as well as implementing the required internal control measures.

 

3.6 INFORMATION AND CONTROL INSTRUMENTS TOWARDS THE GROUP MANAGEMENT

The Board receives annotated key data of all segments within the framework of a Group-wide institutionalized reporting system. The format of the data is defined within a MIS (management information system). Each month, the management information system summarizes in an aggregated format the most important key figures. Every quarter, it presents comprehensive financial statements in line with the requirements set for the year-end. These reports are available to the Group Management in full length and in a condensed format to the Board of Directors. The Board analyzes such data in detail in its meetings. At each ordinary meeting of the Board, the CEO and the CFO inform on the operational day-to-day business and all important business events. The members of the Board and the Board committees are entitled to request information on all  company-related issues. See section 3.4 for additional information on the work methods of the Board and the committees. In addition to the above described management information system, a risk management system was introduced in 2008 and a new state-of-the-art Risk Management Tool was implemented in 2021. Risk management is a fundamental element of Cicor’s business practice at all levels and encompasses different types of risks. It has been integrated into the controlling and reporting process. Material risks are identified and quantified in workshops and discussed with the executive management and the Board of Directors. The risk management process will be repeated regularly, at least once a year. 

4. 1 MEMBERS OF THE GROUP MANAGEMENT

The members of the Group Management are appointed by the Board. The Group Management consists of the CEO and the CFO. As of 31 December 2021, the Group Management consisted of the following persons:

Alexander Hagemann

Born 1962, Alexander Hagemann holds a degree in Mechanical Engineering from the RWTH Aachen University, Germany. Before he joined the Cicor Group as Chief Executive Officer in September 2016, he held the position as Chief Executive Officer of the Schaffner Group from 2007–2016.  Prior to that, Alexander Hagemann held a number of management roles at Schott Group, including the position of Executive Vice President, Optics for Devices. In the beginning of his professional career he held various management positions in the area of production and logistics at BMW.  Alexander Hagemann is Chairman of the Board of Directors of Weidmann Holding AG.

Patric Schoch

Born 1972, Patric Schoch is a senior international CFO, with a proven international career in finance as a controller or CFO for major business units and regions of international companies. Patric Schoch has many years of experience in working in the industry, including living and working for  more than ten years in Southeast Asia, Taiwan and China. He joined Cicor Group as interim CFO end of July 2012 and became permanent CFO as of 1 April 2013. From December 2012 to May 2015 Patric Schoch was also acting CEO of the Group.

4.2 OTHER ACTIVITIES AND VESTED INTERESTS

No member of the Group Management held a position outside the Cicor Technologies Group which could be of significance to the Company.

4.3 MANAGEMENT CONTRACTS

Cicor Technologies Ltd. delegated no management duties to legal entities or natural persons outside the Company in 2021.

This information is provided in the Remuneration Report.

Each registered share of the Company entitles the owner/beneficiary of the share to one vote at the Shareholders’ Meeting, provided that he is registered in the share register of the Company as a shareholder with voting rights.

6.1 VOTING RIGHTS AND REPRESENTATION RESTRICTIONS

There are no statutory restrictions on voting rights. All shareholders, provided that they are registered in the share register of the Company as shareholders with voting rights, have the same right to attend the Shareholders’ Meeting or to be represented by a legal representative or, with written authorization, by another person or by the independent voting proxy.

6.2 STATUTORY QUORUM

The Shareholders’ Meeting passes its resolutions with the absolute majority of the votes allocated to the shares represented. If a second ballot is required, the relative majority of the votes allocated to the shares represented is sufficient for the adoption of an agenda item. In the event of equality of votes, the Chairman has the casting vote. According to the Articles of Incorporation, a resolution of the Shareholders’ Meeting passed by at least two thirds of the votes represented and the absolute majority of the par value of shares represented are required for:

• changing the purpose of the Company;
• introducing shares with privileged voting rights;
• limiting the transferability of registered shares;
• increasing authorized or conditional share capital;
• increasing share capital out of equity, against contributions in kind or for the purpose of acquisition of assets and granting special benefits;
• limiting or withdrawing preemptive rights;
• changing the domicile of the Company;
• dissolving the Company.

6.3 CONVOCATION OF THE SHAREHOLDERS’ MEETING

Shareholders’ Meetings are convened by the Board and, if required, by the Auditors at the latest 20 days before the date of the meeting. The Annual Shareholders’ Meeting is held at the latest within six months of the close of the financial year. Shareholders registered in the share register with  voting rights representing an aggregate of at least 10 % of the share capital may request in writing, setting forth the items to be discussed and the proposals to be decided, that an extraordinary Shareholders’ Meeting is convened. The Company publishes the invitation to the Shareholders’  Meeting in the “SOGC”, as well as in other publications as decided by the Board of Directors. Simultaneously, the written invitation is sent to the shareholders or beneficiaries who are entered in the share register of the Company. The invitation contains details of the day, time and place of the meeting as well as the agenda and the proposals of the Board and the shareholders who have requested the Shareholders’ Meeting or an item to be included on the agenda.

6.4 AGENDA

Shareholders registered in the share register with voting rights, whose combined shareholdings represent an aggregate nominal value of at least CHF 1 million, may request that an item be included in the agenda of a Shareholders’ Meeting. Such a request shall be made in writing at least 60  days before the meeting and shall specify the items and motions to be included in the agenda.

6.5 ENTRY INTO THE SHARE REGISTER

The Computershare Schweiz AG keeps the Company’s share register which contains the names and addresses of shareholders and the number of shares they have registered. After dispatch of the invitation to the Shareholders’ Meeting, no entries can be made in the share register until the  day after the Shareholders’ Meeting has taken place.

7.1 DUTY TO MAKE AN OFFER

The Company does not have an opt-in or opt-out clause in its Articles of Incorporation, meaning that the mandatory bid obligation of the Swiss Stock Exchange Act is triggered if a shareholder or a group of shareholders acting in concert acquire more than one third of the outstanding shares of the Company.

7.2 CLAUSES ON CHANGES OF CONTROL

As of 31 December 2021, there are no specific clauses included in agreements and schemes benefitting members of the Board or Group Management in the event of a change of control situation.

8.1 DURATION OF THE MANDATE AND TERM OF OFFICE OF THE LEAD AUDITOR

The Annual General Meeting of Shareholders’ elects the auditors for a term of one year. On 15 April 2021, the Annual General Meeting of Shareholders’mandated KPMG, Cicor Technologies Ltd.’s Group auditor since 2007, for an additional year. KPMG or a subsidiary of the KPMG Group audits the consolidated and statutory financial statements. The auditor in charge since 2020 of the current mandate is Kurt Stocker.

8.2 AUDITING FEES

During the year under review, KPMG charged a total of TCHF 295 (previous year: TCHF 278) for their services in connection with the auditing of consolidated and statutory financial statements.

8.3 ADDITIONAL FEES

KPMG additionally received fees of TCHF 141 (previous year: TCHF 11) for other services to the company.

8.4 SUPERVISORY AND CONTROL INSTRUMENTS PERTAINING TO THE AUDIT

The Audit Committee supervises and controls on behalf of the Board of Directors the performance and independence of the external auditors. It determines the targets of the audit and assesses the work of the external auditors and their fees. In addition, it reviews the audit result and monitors the implementation of the findings by the management. In 2021, the Audit Committee and the external auditors met once to plan the auditing of the financial statements of the Group and its subsidiaries. In a second meeting, these financial statements, as well as the corresponding “Management Letter” formulated by external auditors, were reviewed and discussed in detail with the Audit Committee. In total, the Audit Committee had three meetings in the presence of the external auditors.

No members of Cicor’s Board of Directors, Group Management, leadership team and employees of Cicor Management AG may make any purchase, sale or other transaction of Cicor securities during the following periods, irrespective of whether or not such relevant person is in possession of insider information: – during the period beginning 15 days prior to half-year or year-end (i.e. 16 June inclusive and 17 December inclusive) and ending on the evening of the day of public announcement of the related semiannual or annual financial results (i.e. trading is authorized as from the morning of the day following the day of the public announcement). The day of public announcement of the semiannual or the annual financial results is published on Cicor’s website under “investors”. Financial results are usually published at 7:00 am CET. The only exception to this rule is the exercise of corporate share actions for shares which are already owned.

For the benefit of its shareholders and the public interested in the business activities of the company, Cicor Technologies Ltd. pursues an open and transparent information policy. In terms of periodical as well as ad hoc reporting, the company aims to guarantee equal treatment with respect to time as well as to content. The company has a clear policy to prevent insider dealings. The corresponding guidelines contain provisions regarding the handling of confidential information to which all persons concerned within and outside of the company are subject, as well as clear instructions regarding time and form of the respective publication. From internal availability to approval of the semiannual or annual results by the Board, the company and its management refrain from communicating to the investing public any qualitative and quantitative statements and information which might give an indication as to the expected sales or results. After the Board meeting, in which the semiannual and annual reports are approved, the general public is informed in summary about the course of business by means of an ad hoc announcement.
Furthermore, the company informs its shareholders, the media, financial analysts and other interested parties by using the following publications and channels:

• annual and interim reports in accordance with Swiss GAAP FER;
• presentation of annual results;
• Shareholders’ Meeting;
• press releases as well as publications of share-price-sensitive facts (ad hoc publicity).

The 2022 Annual Shareholders’ Meeting will be held on 12 April 2022. The interim report is planned to be published on 11 August 2022. For additional information about Cicor Technologies Ltd. and its subsidiaries, please visit the Group’s website (www.cicor.com). Inter alia, previous annual reports and press releases can be found on the website.

Responsible for investor relations is Alexander Hagemann, CEO, phone +41 71 913 73 00, investor@cicor.com.