The Directors are required by the Insurance Business Act (Cap. 403 of the Laws of Malta) and the Companies Act (Cap. 386 of the Laws of Malta) to prepare financial statements which give a true and fair view of the state of affairs of the Group as at the end of each financial year and of the profit or loss for that year.

In preparing the financial statements, the Directors are responsible for:

The Directors are also responsible for designing, implementing and maintaining internal controls relevant to the preparation and the fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error, and that comply with the Insurance Business Act (Cap. 403 of the Laws of Malta) and the Companies Act (Cap. 386 of the Laws of Malta). They are also responsible for safeguarding the assets of the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

In addition, the Directors are required to ensure that the Company has, at all times, complied with and observed the various requirements of the Insurance Business Act (Cap. 403 of the Laws of Malta) and that LifeStar Health Limited has, at all times, complied with and observed the various requirements of the Insurance Distribution Act (Cap. 487 of the Law of Malta).

Information provided in accordance with Capital Markets Rule 5.70.1

There were no material contracts to which the Company, or its subsidiary was a party, and in which anyone of the Company’s Directors was directly or indirectly interested.

Auditors

Grant Thornton have intimated their willingness to continue in office.

A resolution to reappoint Grant Thornton as auditor of the Company will be proposed at the forthcoming annual general meeting.

Information provided in accordance with Capital Markets Rule 5.64

The authorised share capital of the Company is fifty million Euro (€50,000,000.06) divided into three hundred and fifty three million, four hundred and eleven thousand, nine hundred and forty two (353,411,942) ordinary shares of fourteen Euro cents (€0.141478) each share.

The issued share capital of the Company is nine million, one hundred and sixty nine thousand, eight hundred and seventy Euro and sixty eight cents (€9,169,870.68) divided into sixty four million, eight hundred and fourteen thousand, eight hundred and seventeen (64,814,817) ordinary shares of fourteen Euro cents (€0.141478) each share, which have been subscribed for and allotted fully paid-up.

The issued shares of the Company consist of one (1) class of ordinary shares with equal voting rights attached. The shares carry equal rights to participate in any distribution of dividends declared by the Company. Each share shall be entitled to one (1) vote at the meetings of the shareholders. The shares are freely transferable in accordance with the rules and regulations of the Malta Stock Exchange, as applicable from time to time, and in terms of the provisions of the Articles of Association of the Company.

The Directors confirm that as at 31 December 2021, LifeStar Holding p.l.c., and GlobalCapital Financial Management Limited (as nominee for client accounts), held a shareholding in excess of 5% of the total issued share capital. 

The Nominations and Remuneration Committee of the Board of Directors currently consists solely of Non-Executive Directors. It has the responsibility to assist and advise the Board of Directors on matters relating to the remuneration of the Board of Directors and senior management, in order to motivate and retain executives and ensure that the Company is able to attract the best talents in the market in order to maximise shareholder value.

The rules governing the appointment and replacement of the Company’s Directors are contained in Articles 107 to 124 of the Company’s Articles of Association. Directors of the Company are elected on an individual basis by ordinary resolution of the Company in general meeting. The order of priority of the said ordinary resolutions shall be determined and decided by lot. The Company may, in accordance with article 140 of the Companies Act (Cap. 386 of the Laws of Malta) remove a Director by ordinary resolution taken at a general meeting at any time prior to the expiration of his term of office, if any.

The Directors can only issue shares following an extraordinary resolution passed in the Annual General Meeting. This and other powers vested in the Company’s Directors are confirmed in Articles 132 to 142 of the Company’s Articles of Association.

It is hereby declared that as at 31 December 2021, the information required under Capital Markets Rules 5.64.4, 5.64.5, 5.64.6, 5.64.7, 5.64.10 and 5.64.11 is not applicable to the Company

Information pursuant to Capital Markets Rule 5.70.2

The Company Secretary is Dr Clinton Calleja and the registered office is LifeStar Insurance p.l.c., Testaferrata Street, Ta’ Xbiex, Malta.

Statement by the Directors pursuant to Capital Markets Rule 5.68

We, the undersigned, declare that to the best of our knowledge, the financial statements prepared in accordance with the applicable accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company and its subsidiaries included in the consolidation taken as a whole, and that this Director’s report includes a fair review of the performance of the business and the position of the Company and its subsidiaries included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.

         Signed on behalf of the Board of Directors on 8 April 2022 by Prof. Paolo Catalfamo (Director) and Joseph C. Schembri (Director) as per the Directors' Declaration on ESEF Annual Financial Report submitted in conjunction with the Annual Financial Report. :

Introduction

Pursuant to the Capital Markets Rules issued by the Malta Financial Services Authority, the Company whose equity securities are listed on a regulated market should endeavour to adopt the Code of Principles of Good Corporate Governance (“the Code”) as contained in Appendix 5.1 to Chapter 5 of the Capital Markets Rules.  In terms of the Capital Markets Rules, the Company is hereby reporting on the extent of its adoption of the Code.

The Company acknowledges that the Code does not prescribe mandatory rules but recommends principles so as to provide proper incentives for the Board of Directors (“the Board”) and the Company’s management to pursue objectives that are in the interests of the Company and its shareholders.  Good corporate governance is the responsibility of the Board, and in this regard the Board has carried out a review of the Company’s compliance with the Code during the period under review, and hereby provides its report thereon.

As demonstrated by the information set out in this statement, the Company believes that during the reporting period, it has been in full compliance with the Code.

Compliance with the Code

Principles 1 and 4: The Board

The Directors report that for the financial year under review, the Directors have provided the necessary leadership in the overall direction of the Company and have performed their responsibilities for the efficient and smooth running of the Company with honesty, competence and integrity. The Company is committed to the highest standards of business conduct and seeks to maintain these standards across all of its operations.

Directors, individually and collectively, are of appropriate calibre, with the necessary skill and experience to assist them in providing leadership, integrity and judgement in directing the Company towards the maximisation of shareholder value and to make an effective contribution to the leadership and decision-making processes of the Company as reflected by the Company’s strategy and policies. In fact, the Board comprises a number of individuals, all of whom have extensive knowledge of insurance. Members of the Board are selected on the basis of their core competencies and professional background in the industry so as to ensure the continued success of the Company.

All the members of the Board are fully aware of, and conversant with, the statutory and regulatory requirements connected to the business of the Company. The Board is accountable for its performance and that of its delegates to shareholders and other relevant stakeholders.

Its responsibilities also involve the oversight of the Company’s internal control procedures and financial performance, and the review of business risks facing the Company, ensuring that these are adequately identified, evaluated, managed and minimised. The activities of the Board are exercised in a manner designed to ensure that it can effectively supervise the operations of the Company and protect the interests of bondholders, external borrowers and the shareholders

The Company has a structure that ensures a mix of executive and non-executive directors and that enables the Board to have direct information about the Company’s performance and business activities.

All directors are required to:

In terms of the Capital Markets Rules 5.117 – 5.134 the Board has established an Audit committee to monitor the Company’s present and future operations, threats and risks in the external environment and current and future strengths and weaknesses. The Audit committee ensures that the Company has the appropriate policies and procedures in place to ensure that the Company and its employees maintain the highest standards of corporate conduct, including compliance with applicable laws, regulations, business and ethical standards. The Audit committee has a direct link to the board and is represented by the Chairman of the Audit committee in all Board meetings.

Principle 2: Chairman and Chief Executive Officer 

In compliance with the provisions of this Principle, the functions of the Chairman and the CEO of the Company are segregated from one another. Prof. Paolo Catalfamo occupies the post of Chairman whilst Ms. Cristina Casingena occupies the post of CEO.

The responsibilities and roles of the Chairman and the Chief Executive Officer are clearly established and agreed to by the Board of Directors.

The Chairman is responsible to:

Principle 3: Composition of the Board

In accordance with the provisions of the Company’s Articles of Association, the appointment of Directors to the Board is exclusively reserved to the Company’s shareholders, except in so far as appointment is made to fill a casual vacancy on the Board, and which appointment would expire at the Company’s Annual General Meeting following appointment.  Any vacancy among the Directors may be filled by the co-option of another person to fill such vacancy.  Such co-option shall be made by the Board of Directors. 

The Board has the overall responsibility for the activities carried out within the Company and the Group and thus decides on the nature, direction, strategy and framework of the activities and sets the objectives for the activities.

The Board is composed of five (5) Directors (one (1) of whom is the Chairman), with four (4) being non-executive Directors and one being an executive Director. The present mix of executive and non-executive directors is considered to create a healthy balance and serves to unite all stakeholders interests, whilst providing direction to the Company’s management to help maintain a sustainable organisation.

The non-executive directors constitute a majority on the Board and their main functions are to monitor the operations of the executive director (the Chief Executive Officer) and her performance. For the purpose of Capital Markets Rules 5.118 and 5.119, Mr Mark J Bamber, Mr Joseph C Schembri and Mr Joseph M Rizzo are the non-executive directors which are deemed independent.  Each director is mindful of maintaining independence, professionalism and integrity in carrying out his duties, responsibilities and providing judgement as a director of the Company.

The Board considers that none of the independent directors of the Company:

Each of the directors hereby declares that he undertakes to:

The Board of Directors is currently chaired by Prof. Paolo Catalfamo. The Company Secretary (Dr. Clinton Calleja) attends all meetings and takes minutes. Under the direction of the Chairman, the Company Secretary’s responsibilities include ensuring good information flows between the Board of Directors and its Committees and between senior management and the Directors, as well as ensuring that the Board of Directors’ procedures are followed. The Company’s Articles of Association also provide for adequate controls and procedures in so far as the treatment of conflicts of interest during Board of Directors meetings is concerned.

The Articles of Association of the Company clearly set out the procedures to be followed in the appointment of directors. The following Directors served on the Board during the period under review:

Principle Five: Board Meetings

The Directors meet regularly to dispatch the business of the Board. The Directors are notified of forthcoming meetings by the Company Secretary with the issue of an agenda and supporting Board papers, which are circulated in advance of the meeting. Minutes are prepared during the Board meetings recording inter alia attendance, and resolutions taken at the meeting. The Chairman ensures that all relevant issues are on the agenda supported by all available information, whilst encouraging the presentation of views pertinent to the subject matter and giving all Directors every opportunity to contribute to relevant issues on the agenda. The agenda for the meeting seeks to achieve a balance between long-term strategic and short-term performance issues.

The Board of Directors meets in accordance with a regular schedule of meetings and reviews and evaluates the Group’s strategy, major operational and financial plans, as well as new material initiatives to be undertaken by the Group. The Board of Directors meets formally at least once every quarter and at other times on an ‘as and when’ required basis.

During the period under review, the Board of Directors me seventeen (17) times. The following Directors attended Board meetings as follows:

Principle Six: Information and Professional Development

The Company ensures that it provides directors with relevant information to enable them to effectively contribute to Board decisions. The Company Secretary ensures effective information flows within the Board, committees and between senior management and Directors, as well as facilitating professional development. The Company Secretary advises the Board through the Chairman on all governance matters.

Directors may, in the course of their duties, take independent professional advice on any matter at the Company’s expense. The Company will provide for additional individual Directors' training on a requirements basis. 

The Chief Executive Officer ensures that systems are in place:

Principle Seven: Evaluation of the Board’s Performance

The Chairman of the Board informally evaluates the performance of the Board members, which assessment is followed by discussions within the Board.  Through this process, the activities and working methods of the Board and each committee member are evaluated.  Amongst the things examined by the Chairman through his assessment are the following: how to improve the work of the Board further, whether or not each individual member takes an active part in the discussions of the Board and the committees; whether they contribute independent opinions and whether the meeting atmosphere facilitates open discussions. Under the present circumstances the Board does not consider it necessary to appoint a committee to carry out a performance evaluation of its role as the Board’s performance is furthermore also under the scrutiny of the shareholders. On the other hand, the performance of the Chairman is evaluated by the Board of Directors of the ultimate controlling party, taking into account the manner in which the Chairman is appointed.  The self-evaluation of the Board has not led to any material changes in the Company’s governance structures and organisations.

Principle Eight: Committees

Audit and Risk Committee

The Board of Directors delegates certain responsibilities to the Audit Committee, the terms of reference of which reflect the requirements stipulated in the Capital Markets Rules. As part of its terms of reference, the Audit Committee has the responsibility to vet, approve, monitor and scrutinise any related party transactions falling within the ambits of the Capital Markets Rules, and to make its recommendations to the Board of Directors on any such proposed related party transactions. The Audit Committee also assists the Board of Directors in monitoring and reviewing the Group’s financial statements, accounting policies and internal control mechanisms in accordance with the Committee’s terms of reference.

In the performance of its duties the Audit Committee calls upon any person it requires to attend meetings.  The external auditors of the Company are invited to attend all relevant meetings. The internal auditors are also invited to attend meetings of the Audit Committee and report directly any findings of their audit process.  The head of legal and compliance, as well as the compliance officers of the regulated subsidiaries are invited to attend meetings of the Audit Committee to present their compliance reports, as necessary. In addition, the Audit Committee invites the Chief Financial Officer and other members of management to attend Audit Committee meetings on a regular basis and as deemed appropriate.

The Audit Committee also approves and reviews the Group’s Compliance Plan and Internal Audit Plan prior to the commencement of every financial year and monitors the implementation of these plans. The remit of the Audit Committee was also extended to include group risk management, and it is also referred to as the Audit and Risk Committee.

The Audit Committee is directly responsible and accountable to the Board. During the financial year under review, the Audit Committee held two (2) meetings, having been constituted following the admission of the Company’s shares to the Official List of the Malta Stock Exchange plc with effect from 08 June 2021.

The Audit Committee is chaired by Joseph C. Schembri, who is an auditor by profession, and is considered to be an independent non-executive member possessing the necessary competence in auditing and accounting as required in terms of the Capital Markets Rules. All the members that served on the Audit Committee were deemed by the Board of Directors to be Independent Non-Executive Directors, and the Board of Directors felt that as a whole the Audit Committee had the necessary skills, qualifications and experience in satisfaction of the Capital Markets Rules.

The terms of reference of the Audit Committee include, inter alia , its support to the Board of the Company in its responsibilities in dealing with issues of risk management, control and governance and associated assurance. The Board has set formal terms that establish the composition, role , function, the parameters of the Audit Committee’s remit as well as the basis for the processes that it is required to comply with. The Terms of Reference of the Audit Committee, which were approved by the Malta Financial Services Authority, are modelled on the principles set out in the Capital Markets Rules themselves.

Briefly, the Audit Committee is expected to deal with and advise the Board on the following matters:

In addition, the Audit Committee also has the role and function of scrutinising and evaluating any proposed transaction prior to be entered into by the Company and a related party, to ensure that the execution of any such transaction is at arm's length and on a commercial basis and ultimately in the best interests of the Company. The Audit committee oversees the financial reporting of the Company and ensures the process takes place in a timely manner. The committee is free to question any information that may seem unclear.

Remuneration and Nomination Committee

The Board has established a Remuneration and Nomination Committee, which performs the functions of a remuneration committee and of a nomination committee (in each case in compliance with the requirements of the Corporate Governance Code of the Capital Markets Rules).

During the financial year under review, the Nominations and Remuneration Committee met three (3) times and was composed of Mark Bamber as Chairman, and Joseph C. Schembri as member.

Remuneration Function

The Remuneration and Nomination Committee monitors, reviews, and advises on the Company’s remuneration policy as well as approves the remuneration packages of senior executives and management. The main activities of the Remuneration and Nomination Committee include devising appropriate policies and remuneration packages to attract, retain, and motivate Directors and senior management of a high caliber in order to well position the Company and LifeStar Health within the insurance market and its areas of business.

In the fulfilment of its remuneration matters oversight, the Committee monitors, reviews and advises on the Group’s Remuneration Policy, as well as approves the remuneration packages of senior executives and Management.

Nominations Function

The Remuneration and Nominations Committee is also responsible for making recommendations for appointment to the Board and for reviewing in order to ensure that appointments to the Boards are conducted in a systematic, objective and consistent manner. It is also responsible for the review of performance of the Company’s Board members and committees, the appointment of senior executives and management and the development of a succession plan for senior executives and management. Additionally, this committee monitors, reviews and advises on the Company’s remuneration policy as well as approves the remuneration packages of senior executives and management.

Other Management Committees

Executive Committee (EXCO)

The Company’s EXCO operates as a direct management committee under the authority of the Board and is responsible for the overall delivery of the Company’s strategy. EXCO also acts as Product and Pricing Committee with the prime responsibility of approving and overseeing the implementation of new products, new terms for new and existing products and marketing campaigns. The EXCO is also tasked with the approval and oversight of the performance of all products and with ensuring that products, product designs and product distribution are aligned with their intended target market and with the identified customers’ needs.

EXCO meets at least ten times a year and executes the first line management responsibilities. During the period under review the EXCO met twelve (12) times. The EXCO is composed of Cristina Casingena (CEO); Roberto Apap Bologna (CFO), Jonathan Camilleri (Chief Operations Officer), Adrian Mizzi (Chief Information Officer), Chris Chetcuti (Head of Sales), Jonathan Portelli (Life Operations Manager), Rebeca Alexiu (Product Manager), Enrico Depasquale (Compliance Manager); Maria Michaelides (Actuarial Function – Deloitte Cyprus) and Dimitris Dimitriou (Risk Manager – Deloitte Cyprus).

Asset and Liability Committee (ALCO)

ALCO’s primary responsibilities are to report and advise the Board on all matters pertaining to the balance sheet (asset and liabilities) and investments of the Company’s monies. ALCO is also responsible for managing balance sheets, associated risks and earnings (economic, IFRS) and capital levels to achieve performance objectives within prescribed risk parameters.

ALCO reviews and submits to the Board for approval the Company’s investment policy on an annual basis and ensures that the investments of the Company are in compliance with the prudent person principle as directed by the article 132 of the Solvency II Directive (Directive 2009/138/EC).

ALCO monitors the investment performance of the Company on a regular basis and ensures that an appropriate governance framework is in place for the appointment and monitoring of the activity of external or internal asset managers. ALCO has the oversight responsibility of any outsourced investment management arrangement.

ALCO meets at least quarterly and executes the first line management responsibilities. During the period under review, the ALCO met five (5) times. The ALCO is composed of Cristina Casingena (CEO), Roberto Apap Bologna (CFO), Konrad Camilleri (Investment Manager), Keith Huber (Independent Investment Advisor), Enrico Depasquale (Compliance Officer), Dimitris Dimitriou (Risk Manager – Deloitte Cyprus), Maria Michaelides (Actuarial Function – Deloitte Cyprus).

Risk Management Committee (RMC)

RMC operates as a direct management committee under the authority of the Board and is responsible for the overall enterprise-wide management of all risk within the Company or impacting the Company.

RMC is responsible for the ongoing monitoring, assessment, reporting and management of the risk environment and the effectives of the risk management framework.

RMC meets at least quarterly and executes the second line of defense responsibilities. During the period under review the RMC met five (5) times. The RMC is composed of Cristina Casingena (CEO), Roberto Apap Bologna (CFO), Jonathan Camilleri (Chief Operations Officer), Dimitris Dimitriou (Risk Manager – Deloitte Cyprus), Maria Michaelides (Actuarial Function – Deloitte Cyprus) and Enrico Depasquale (Compliance Manager).

Internal controls

The Board is ultimately responsible for the Company’s system of internal controls and for reviewing its effectiveness. The Company has an appropriate organisational structure for planning, executing, controlling and monitoring business operations in order to achieve its objectives. 

The Group encompasses different licensed activities regulated by the MFSA. These activities include the carrying on of long-term business of insurance under the Insurance Business Act (Cap. 403 of the Laws of Malta); and acting as an agent for sickness and accident insurance in terms of the Insurance Distribution Act (Cap. 487 of the Laws of Malta). The Board of Directors has continued to ensure that effective internal controls and processes are maintained to support sound operations, and the committees set up by the Company (EXCO, ALCO and RMC) further enhance internal controls and processes. Policies such as Risk Compliance Monitoring Programmes, Risk Management, Complaints, Data Protection, Internal Audit and Anti-Money Laundering Policies and Procedures have been adopted. The policies that have been adopted also include a Conflict of Interest Policy.

The Directors are aware that internal control systems are designed to manage, rather than eliminate, the risk of failure to achieve business objectives, and can only provide reasonable, and not absolute, assurance against normal business risks. During the financial year under review the Company operated a system of internal controls which provided reasonable assurance of effective and efficient operations covering all controls, including financial and operational controls and compliance with laws and regulations. Processes are in place for identifying, evaluating and managing the significant risks facing the Company.

The Company has implemented control procedures designed to ensure complete and accurate accounting for financial transactions and to limit the potential exposure to loss of assets or fraud. Measures taken include physical controls, segregation of duties and reviews by management, internal audit and the external auditors. The Internal Audit Department monitors and reviews the Group’s compliance with policies, standards and best practice in accordance with an Internal Audit Plan approved by the Audit Committee. KPMG fulfil the functions of internal auditors of the Company.

Principle Nine and Ten: Relations with Shareholders and with the Market, and Institutional Shareholders

The Company recognises the importance of maintaining a dialogue with its shareholders and of keeping the market informed to ensure that its strategies and performance are well understood.  During the period under review, the Company has maintained an effective communication with the market through a number of channels including Company announcements and Circulars.

The Company shall also communicate with its shareholders through the Company’s Annual General Meeting (“AGM”) to be held later in 2022, which will include resolutions such as the approval of the Annual Report and Audited Financial Statements for the year ended 31 December 2021, the election/re-election of Directors, the determination of the maximum aggregate emoluments that may be paid to Directors, the appointment of auditors and the authorisation of the Directors to set the auditors’ remuneration, as well as any other resolution as may necessary in terms of law or as required by the Company. In terms of Rule 12.26L of the Capital Market Rules, an annual general meeting shall have the right to hold an advisory vote on the remuneration report of the most recent financial year. Both the Chairman of the Board and the Chairman of the Audit Committee will be available to answer shareholder questions, which may be put forward in terms of Rule 12.24 of the Capital Markets Rules.

Apart from the AGM, the Group communicates and shall communicate with its shareholders through the publication of its Annual Report and Financial Statements, the publication of interim results, updates and articles on the Group’s website, the publication of Group announcements and press releases.

The Office of the Company Secretary maintains regular communication between the Company and its investors.  Individual shareholders can raise matters relating to their shareholdings and the business of the Company at any time throughout the year, and are given the opportunity to ask questions at the AGM or to submit written questions in advance.

As provided by the Companies Act (Cap. 386), minority shareholders may convene Extraordinary General Meetings. 

Principle Eleven: Conflicts of Interest

The Directors are fully aware of their responsibility always to act in the best interests of the Company and its shareholders as a whole irrespective of whoever appointed or elected them to serve on the Board. 

On joining the Board and regularly thereafter, the Directors are informed of their obligations on dealing in securities of the Company within the parameters of law, including the Capital Markets Rules, and Directors follow the required notification procedures.

Directors’ interest in the shareholding of the Company:

With the exception of Paolo Catalfamo, none of the Directors of the Company have any interest in the shares of the Company’s subsidiaries or investees or any disclosable interest in any contracts or arrangements either subsisting at the end of the last financial year or entered into during this financial year. No other changes in the Directors’ interest in the shareholding of the Company between year-end and 8 April 2022.

Paolo Catalfamo holds shares in the Company indirectly through his shareholding in Investar plc which is the Company’s ultimate holding company as disclosed in note 30.

Principle Twelve: Corporate Social Responsibility

The Company seeks to adhere to sound Principles of Corporate Social Responsibility in its management practices, and is committed to enhance the quality of life of all stakeholders of the Company. The Board is mindful of the environment and its responsibility within the community in which it operates. In carrying on its business the Company is fully aware of and at the forefront in preserving the environment and continuously reviews its policies aimed at respecting the environment and encouraging social responsibility and accountability. During the financial year under review, the Group pursued its corporate social responsibility by supporting and contributing to a number of charitable causes.

Remuneration Committee

The remuneration functions of the Remuneration and Nominations Committee were performed by Mark Bamber as Chairman, and Joseph C. Schembri as member.

Remuneration policy

The Remuneration Policy of the Company is intended to provide an over-arching framework that establishes the principles and parameters to be applied in determining the remuneration to be paid to any member of the Board of Directors, and the senior executives. The policy describes the components of such remuneration and how this contributes to the Company’s business strategy, in the context of its long term sustainable value creation. This remuneration policy is divided into five (5) parts distinguishing between directors, senior management, employees, intermediaries and service providers.

Remuneration payable to Directors

Fixed remuneration

The remuneration payable to Directors shall be fixed and will not have any incentive programmes and Directors will therefore not receive any performance-based remuneration. None of the Directors, in their capacity as Directors of the Company, is entitled to profit-sharing, share options or pension benefits.

In addition to fixed remuneration in respect of their position as members of the Board of Directors of the Company, individual Directors who are also appointed to chair, or to sit as members of, one or more committees or sub-committees of the Company, or its subsidiaries, are entitled to receive additional remuneration as may be determined by the Board of Directors from time to time. Any such additional remuneration shall, however, form part of the aggregate emoluments of the Directors as approved by the general meeting of the Company. The basis upon which such additional remuneration is paid shall take into account the skills, competencies and technical knowledge that members of such committees require and the respective functions, duties and responsibilities attaching to membership of such committees.

Other entitlements

The Company may also pay out fringe benefits, comprising of medical and life insurance.

Director Employment Service Contracts

As at the date hereof, Ms. Cristina Casingena is the only executive Director of the Company and occupies the role of Chief Executive Officer, having an employment service contract.

Remuneration payable to executives

Senior executive service contracts

All senior executive contracts are of an indefinite duration and subject to the termination notice periods prescribed by law.

Remuneration Report

In terms of Rule 12.26K of the Capital Markets Rules, the Company is also required to draw up an annual remuneration report (the “Remuneration Report”), which report is to:

In this respect, the Company is hereby producing its remuneration report following the approval and entry into effectiveness, in October 2020, of the Remuneration Policy described in the preceding sections.

Remuneration paid to Directors (including the CEO)

All remuneration for directors was in conformity with this policy. The remuneration paid to individual Directors during the year under review and 2020 was as follows:

The total emoluments received by the Chief Executive Officer, who is also an Executive Director for the financial years 2021 and 2020 were as follows:

The remuneration paid to the Directors covers both their role as directors of Company and their role as members of chairpersons or members of any sub-committees of the Company, as well as their position as directors of subsidiaries forming part of the Group.

It is the shareholders, in terms of the memorandum and articles of association of the company, who determine the maximum annual aggregate emoluments of the directors by resolution at the annual general meeting of the company. Remuneration payable to directors (in their capacity as directors) is reviewed as and when necessary and is not linked to the share price or the company’s performance. These are benchmarked against market practice for major local companies of similar size and complexity.

The aggregate amount fixed for this purpose during the last annual general meeting of LifeStar Holding plc was €400,000. A maximum annual aggregate emoluments of the Directors of the Company shall be fixed at the upcoming annual general meeting.

The aggregate emoluments of the Directors (including the CEO) in respect of their role as directors of the Company and, where applicable, as members of sub-committees of the Board of Directors of the Company and non-executive directors of LifeStar Health Limited, amounted to €175,000. No variable remuneration is paid to Directors in their capacity as Directors of the Company.  The Directors do not expect the abovementioned maximum aggregate remuneration limit of €400,000 to be exceeded during the financial year ending 31 December 2022.

The Remuneration Committee is satisfied that the fixed remuneration for the year under review is in line with the core principles of the Remuneration Policy applicable during the year under review, including giving due regard to market conditions and remuneration rates offered by comparable organisations for comparable roles.

Remuneration paid to Senior Management

Remuneration paid to Senior Management amounts to €569,405 and excludes the fringe benefit for health insurance and life cover as described above.

Decision-making with respect to the Remuneration Policy

Whereas the Board of Directors is responsible for determining the Remuneration Policy of the Company, the Remuneration and Nominations Committee, acting in its function as the Remuneration Committee, is, in turn, responsible for overseeing and monitoring its implementation and ongoing review thereof. This policy is to be reviewed annually by the Remuneration and Nominations Committee of the Company. The annual review will ensure that the policy remains relevant for the Company and that any improvements by way of amendments are indeed effected.

In evaluating whether it is necessary or beneficial to supplement or otherwise alter the Remuneration Policy of the Company, the Remuneration Committee have regard to, inter alia, best industry and market practice on remuneration, the remuneration policies adopted by companies operating in the same industry sectors, as well as legal and, or statutory rules, recommendations or guidelines on remuneration, including but not limited to the Code of Principles of Good Corporate Governance contained in Appendix 5.1 of the Capital Markets Rules of the Malta Financial Services Authority.

Whilst members of the Remuneration Committee may be present while his/her remuneration as a Director or other officer of the Company and, or of any other company forming part of the Group, is being discussed at a meeting of such Committee, any decision taken by the Committee in this respect shall be subject to the approval of the Board of Directors. At a meeting of the Board of Directors, no Director may be present while his/her remuneration as a Director or other officer of the Company and, or of any other company forming part of the Group, is being discussed

Other information on remuneration in terms of Appendix 12.1 of the Capital Markets Rules

In terms of the requirements within Appendix 12.1 of the Capital Market Rules, the following table presents the annual change of remuneration, of the company’s performance, and of average remuneration on a full-time equivalent basis of the company’s employees (other than directors) over the two most recent financial years. The Company’s non-executive Directors, have been excluded from the table below since they have a fixed fee as described above.

The contents of the Remuneration Report have been reviewed by the external auditor to ensure that the information required in terms of Appendix 12.1 to Chapter 12 of the Capital Markets rules have been included.