Kendrion N : Annex 1 - Remuneration policy Executive Board

KENDRION N.V.

REMUNERATION POLICY

EXECUTIVE BOARD

PROPOSED AGM 15 APRIL 2024

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EXECUTIVE BOARD REMUNERATION POLICY

1. General

The remuneration policy for the members of the Executive Board of Kendrion N.V. ("Kendrion") has been developed by the Supervisory Board and proposed for adoption to the general meeting of shareholders (the "General Meeting") in April 2023 and - in accordance with the commitment made during the General Meeting in April 2023 - subsequently in April 2024 to update the share ownership guideline described below. Following adoption by the General Meeting in April 2023 the remuneration policy has become applicable to (i) remuneration granted in the years 2024 up to and including 2027 - irrespective whether pay-outs and vesting of performance shares become due, occur or are made after 2027; and (ii) remuneration of Executive Board members reappointed by the General Meeting in 2023 as of the date on which the new term of office of such reappointed Executive Board member commences, it being understood that the share ownership guideline in this remuneration policy becomes effective upon adoption by the General Meeting in April 2024.

The Executive Board remuneration policy is evaluated at least once every four years by the Supervisory Board. The HR Committee of the Supervisory Board will continue to keep the Supervisory Board informed of relevant market and legislative developments in order to support the periodic evaluation of the remuneration policy and related decision-making.

2. Objectives

The remuneration policy serves to recruit and retain diverse, qualified, and experienced executives to deliver Kendrion's sustainable long-term value creation strategy. In addition, the remuneration policy aims to maintain an adequate link between pay and performance and appropriately align the interests of the members of the Executive Board with the interests of shareholders - and the interests of other stakeholders - and focus on the sustainable delivery of high performance over the long-term by stimulating share ownership whilst adhering to the applicable standards of good corporate governance.

Taking account of Kendrion's size (in terms of revenues, average market capitalisation, total assets, and number of FTE), its industrial market position, geographical scope and labour market competition, the companies included in the AScX Index on Euronext Amsterdam are defined as relevant reference group. Financial services, real estate and movies and entertainment companies are excluded from the reference group. Within the defined reference group, Kendrion is positioned around the median in terms of the average of the abovementioned parameters revenues, average market capitalisation, total assets, and number of FTE. The remuneration structure and level for the Executive Board is set around the median level relative to the reference group.

The remuneration policy does not contain variable incentives that may be detrimental to the responsibilities of the Executive Board in defining and achieving Kendrion's sustainable long-term value creation strategy.

3. Temporary deviations remuneration policy

In exceptional circumstances, the Supervisory Board can decide to temporarily deviate from the remuneration policy for members of the Executive Board. Exceptional circumstances mean circumstances in which a deviation is considered necessary to serve the long-term interests and sustainability of Kendrion or to otherwise ensure its viability.

Depending on the exceptional circumstances, the Supervisory Board can resolve to deviate from any or all of the four remuneration components included in the remuneration policy for members of the Executive Board.

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When considering a temporary deviation from the remuneration policy, the Supervisory Board shall consider Kendrion's sustainable long-term value creation strategy, ongoing business and operational requirements as well as the financial situation of Kendrion. In addition, the temporary deviation considered should be assessed in light of the principles of reasonableness and fairness.

Upon having resolved a temporary deviation from the remuneration policy, the Supervisory Board will (i) cancel and withdraw all temporary deviations from the remuneration policy prior to the first annual General Meeting following the effective date of the deviation; or (ii) propose the necessary amendments to the remuneration policy for adoption during the first annual General Meeting following the effective date of the deviation.

Deviations from the remuneration policy will be reported in Kendrion's remuneration report.

4. Remuneration components

The remuneration policy for the members of the Executive Board consists of four components: a fixed base salary, a short-term variable remuneration, a long-term variable remuneration and other benefits such as a pension scheme and a car allowance or lease budget.

The sum of the fixed base salary, the short-term variable remuneration and the long-term variable remuneration for members of the Executive Board are considered appropriate in relation to: (i) the identity, the purpose, and values of Kendrion, (ii) the pay-ratios within Kendrion, (iii) the (international) context in which Kendrion operates and (iv) reasonable views of relevant stakeholder groups.

The variable remuneration components are subject to a maximum value determined in advance in accordance with the remuneration policy.

The Supervisory Board will carry out scenario analyses to assess that the pay-out level of variable remuneration components appropriately reflect performance.

5. Fixed base salary

Members of the Executive Board receive a fixed base salary, the amount of which is set around the median level relative to the relevant reference group referred to above in paragraph 2 (Objective) of this remuneration policy. The fixed base salary levels can be adjusted to be decided upon by the Supervisory Board, based on general market movement and inflation figures.

In addition to the above, any increase of the annual fixed base salary up to and around the prevailing median level relative to the relevant reference group referred to above in paragraph 2 (Objective), can be decided upon by the Supervisory Board and will not be regarded as an amendment to the remuneration policy.

6. Short-term variable remuneration

The short-term variable remuneration is payable in cash, the amount of which is based on the achievement of predetermined, specific, and measurable financial and non-financial driven performance criteria.

6.a Performance criteria

The performance criteria for the short-term variable remuneration are based on Kendrion's strategic intent to continuously grow revenue and profitability in a sustainable way, with a lean and

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focused organisation, and to provide a safe and high-quality work environment to its employees. Supportive to Kendrion's strategic intent, the performance criteria for the short-term variable remuneration include financial and non-financial criteria.

The financially driven performance criteria determine 60% of the short-term variable remuneration and reflect the financial priorities of Kendrion. The remaining 40% of the short-term variable remuneration is determined by non-financially driven performance criteria and reflect sustainability/ESG ambitions and other priorities directly linked to Kendrion's strategic intent.

6.b Financial performance criteria

Each year the Supervisory Board selects at least three financial driven performance criteria from the list below with a view to incentivise delivery of financial priorities that support Kendrion's strategic and operational spearheads.

The Supervisory Board may allocate different weight percentages to the different financial performance criteria it selects for a particular year, provided a minimum weight of 10% shall apply to a financial performance criterion.

Financial performance criteria1

Net profit

Return on sales (ROS)

Return on investment (ROI)

Organic growth

Free cash flow

Revenue

EBITA

EBITDA

The performance incentive zone (threshold, target and maximum) for each financial performance criterion will be determined in advance by the Supervisory Board by reference to the strategic and operational spearheads for the respective performance year. No pay-out will be made for below threshold performance.

6.c Non-financial performance criteria

Each year the Supervisory Board selects a certain number of non-financial performance criteria derived from the strategic and operational spearheads for the respective performance year, which will in any event include performance criteria in the area of sustainability/ESG (i.e. environmental, social and/or governance criteria).

Achievement of each individual non-financial performance criterion will be measured by applying

1. binary scoring model. The amount of the pay-out for the achievement of non-financial performance criteria depends on the number of non-performance criteria achieved. A predefined step curve will be applied to calculate the pay-out between the achievement of the minimum threshold number of selected non-financial performance criteria and achievement of all selected non-financial performance criteria. No pay-out will be made for below threshold performance.

1 In each case excluding items that are generated outside the ordinary course of business and the amortization of intangibles arising on acquisitions or similar corporate events.

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6.d Investment of part of the short-term remuneration earned

Members of the Executive Board must invest at least 20% of the net amount of the pay-out of the short-term remuneration earned until the required ownership level has been reached as prescribed under the 'Share ownership guideline' described in paragraph 8 of this remuneration policy.

7. Long-term variable remuneration

The long-term variable remuneration component incentivises members of the Executive Board to focus on long-term sustainable value for shareholders and other stakeholders and to align the interests of the members of the Executive Board with the long-term interests of shareholders and other stakeholder groups.

The members of the Executive Board annually receive conditional performance shares. The conditional performance shares will vest upon achievement of performance measured over a performance period of three years, including the year in which the conditional performance shares are granted. Vested performance shares are restricted by a two-year holding period as of vesting.

7.a Target value - size of the award

The size of the award is defined as a percentage of the annual fixed gross base salary of the concerned Executive Board member as per the year in which the conditional performance shares are granted.

Target value as per the year in which conditional performance shares are granted

The actual grant (i.e. the number of conditional performance shares) is determined by the percentage of the annual fixed gross base salary and calculated on the basis of the average share price during the fourth quarter of the year immediately preceding the year in which the conditional performance shares are granted.

7.b Performance incentive zone

Performance incentive zone

7.c Performance measures

The vesting percentage of the performance shares is conditional upon the achievement of performance measured as:

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provided that the sum of the Pension and Disability Insurance Contribution and such annual allowance shall annually not exceed an amount of EUR 75,000. This amount may be adjusted based on market developments.

No schemes have been agreed for the voluntary early retirement of members of the Executive Board.

Kendrion maintains a car lease policy for members of the Executive Board. The lease budget (including fuel) is EUR 2,000 per month. Alternatively, members of the Executive Board are entitled to a monthly gross car allowance of EUR 2,000.

In addition, Kendrion pays a monthly expense allowance to members of the Executive Board of up to EUR 450, to cover costs that are not suitable for individual reimbursement.

The amount of the car allowance and the expense allowance are not included as a basis for calculation of the Pension and Disability Insurance Contribution, or any other (variable) remuneration or allowance, severance amount or benefit.

Kendrion has arranged for a directors' and officers' liability insurance. The costs for this insurance are for the account of Kendrion.

12. Other key elements management agreement

12.a Term and termination

Management agreements with members of the Executive Board are entered for a definite period of four years. The management agreement may be terminated with due observance of a notice period of six months. Kendrion is entitled to terminate the management agreement with immediate effect for cause (i.e. seriously culpable or negligent behaviour on the part of the Executive Board member).

12.b Termination fee

In the event of termination of the management agreement on Kendrion's initiative, the termination fee for members of the Executive Board shall not exceed 100% of the annual fixed gross base salary (i.e. excluding short-term and long-term incentive and other elements such as pension contributions).

The members of the Executive Board are not entitled to a termination fee if the contract is terminated for cause (i.e. seriously culpable or negligent behaviour on the part of the Executive Board member) or if the contract is terminated at the initiative of the Executive Board member.

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Annex 1

(TSR performance peer group)

Identified possible replacements in case of delisting or other corporate events in respect of any of the above selected TSR peer companies

• Per reporting date 31 December 2022

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