Falck Renewables S p A : Remuneration Report

FIXED REMUNERATION

Remunerates the skills, experience and contribution required by the role

€ 340,000

€ 600,000 annual pro rata temporis as from February 24, 20221

Fixed remuneration is related to the role covered and the responsibilities attributed to said role, as well as the experience and strategic importance of the staff member

Target = € 600,000 pro rata

temporis as from February 24,

SHORT‐TERM VARIABLE INCENTIVE (MBO)

It incentivises the achievement of annual financial and non‐financial objectives

Not applicable

20222

Parameters 2022:

•  EBITDA (weight 40%)

•  System Energy Availability NET

  (35%)

•  Community engagement (15%)

•  Gender balance (10%)

Entry Gate: NFP/EBITDA

MBO system parameters from a minimum of 3 to a maximum of 4 quantitative and/or project parameters diversified depending on the organisational role and the areas of responsibility of each KMP, to which a corrective factor is applied connected with the Group's results.

LONG‐TERM VARIABLE INCENTIVE (LTI)

It is targeted at aligning, in the long‐term, Management's actions with Shareholders' interests

Not applicableNew LTI Plan: taking into account the transaction that led to the change of control of FKR, the BoD New LTI Plan: taking into account will start a process to prepare a the transaction that led to the new LTI Plan based on change of control of FKR, the BoDperformance targets

will start a process to prepare a new LTI Plan based onTarget= € 900,000 pro rata performance targets temporis as from February 24, 2022

SEVERANCE PAYMENT

Indemnities aimed at protecting the interests of the company, preventing any disputes

Not applicable

Indemnity for early termination of the directorship relationship: € 1,800,000 in the event of Good Leaver and € 900,000 in the event of Medium Leaver

Indemnity for the end of mandate for non‐renewal: € 1,800,000 Not envisaged ex ante (Good Leaver o Medium Leaver)

Non‐competition agreement: it is valid for 6 months from the date of termination of office: € 100,000 for each month of duration of the Non‐competition agreement

1 For the period prior to February 24, 2022, the fixed compensation provided for in the Chief Executive Officer's previous compensation package of €500,000 per year will continue to apply pro rata temporis.

2 For the period prior to February 24, 2022, the short‐term variable remuneration envisaged by the previous remuneration package of the Chief Executive Officer will continue to apply pro rata temporis, with a target incentive of €270,000.

Contents

INTRODUCTION ....................................................................................................................... 4

REGULATORY REFERENCES ...................................................................................................... 5

SECTION I (REMUNERATION POLICY) ....................................................................................... 6

PROCEDURES FOR THE ADOPTION AND IMPLEMENTATION OF THE REMUNERATION POLICY . 7

Entities involved ..................................................................................................................... 7

Process of defining and approving the policy ...................................................................... 10

DURATION OF THE REMUNERATION POLICY ........................................................................... 10

PURPOSE OF THE REMUNERATION POLICY .............................................................................. 10

GENERAL PRINCIPLES OF THE REMUNERATION POLICY ........................................................... 11

LINK BETWEEN STRATEGY, REMUNERATION AND SUSTAINABILITY ......................................... 12

THE MAIN CHANGES OF FALCK RENEWABLES' REMUNERATION POLICY .................................. 13

INFORMATION ON THE COMPANY'S REMUNERATION POLICY ................................................ 15

Chairman of the Board of Directors ..................................................................................... 16

Non‐executive Directors ...................................................................................................... 16

Executive Directors .............................................................................................................. 17

Key management personnel ................................................................................................ 25

Members of the Board of Statutory Auditors ...................................................................... 29

EXCEPTION PROCEDURE .......................................................................................................... 30

SECTION II (COMPENSATION PAID) ........................................................................................ 31

FIRST PART ............................................................................................................................... 32

SECOND PART .......................................................................................................................... 40

INTRODUCTION

The remuneration of the Directors, particularly those holding executive positions, Managing Directors, Key Management Personnel and members of the Board of Statutory Auditors represent a fundamental incentive and control mechanism for ensuring the integrity and effectiveness of corporate governance mechanisms. The company Falck Renewables S.p.A. ("Company"), in drafting the Annual Report on the Remuneration Policy and Compensation Paid ("Report"), intends to increase Shareholders' involvement in defining remuneration policies and strengthening the transparency of the contents of these policies and their effective implementation, allowing investors to access information on the incentive system in force, promoting a more accurate evaluation of the Company and making it easier for said Shareholders to exercise their rights in an informed manner.

With this document, the Company intends to present to the Shareholders' Meeting a report describing the general remuneration policy for the year 2022 and highlighting the effective application of that relating to 2021.

The Report is structured into the following sections:

•  Remuneration Policy (Section I)

  It contains information about the Annual Remuneration Policy ("Remuneration Policy" or even just "Policy") with reference to the members of the Administration and Control Bodies and to the Key Management Personnel for the year 2022. Therefore, this section has a forward‐looking value.

  In particular, the first section outlines:

  •  the Company's policy on the remuneration of the members of the Administration and Control Bodies and of the Key Management Personnel with reference to the year 2022;

  •  the procedures used to adopt and implement said policy.

•  Compensation paid (Section II)

  It provides a representation of each item that make up the remuneration and analytically reports the compensation paid in the reference year 2021, for any reason and in any form, by the Company and its subsidiaries and associates.

REGULATORY REFERENCES

This document is prepared in accordance with art. 123‐ter of the TUF (Consolidated Law on Finance), which sets forth that "at least twenty‐one days before the date of the Shareholders' Meeting […] companies with listed shares must provide the public with a report on the Remuneration Policy and Compensation Paid, at the company's registered office, on its website, and with the other methods established by the CONSOB regulation".

The Report was drafted in accordance with the aforementioned art. 123‐ter of Italian Legislative Decree no. 58 of 24 February 1998 and in compliance with Annex 3A, schedules 7‐bis and 7‐ter of CONSOB regulation no. 11971 of 14 May 1999 and subsequent amendments.

Art. 123‐ter, paragraph 3‐bis of the Consolidated Law on Finance requires companies to submit the Remuneration Policy to a shareholders' vote according to the frequency required by the Policy itself (i.e. Section I of this document). This resolution is binding. If the Shareholders' Meeting does not approve the Remuneration Policy, the company continues to pay remuneration in compliance with the most recent Remuneration Policy approved by the Shareholders' Meeting or, in the absence of the latter, may continue to pay remuneration in compliance with the procedures in force.

In defining the Remuneration Policy contained in this document, account was also taken of the principles and recommendations identified by art. 5 of the Code of Corporate Governance issued by Borsa Italiana in January 2020, which the Company subscribes to.

In addition, art. 123‐ter, paragraph 6 of the Consolidated Law on Finance, requires companies to submit the section of the Report, which indicates the compensation paid (i.e. Section II of this document), to a shareholders' vote. This resolution is of an advisory nature.

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