Elica S p A : Remuneration Report Shareholder AGM of April 24, 2024

Remuneration Policy and Report

Pursuant to Article 123-ter of the CFA

ELICA S.p.A.

https://corporate.elica.com/it#governance

Approved by the Board of Directors on March 14, 2024

	Remuneration Policy and Report
CONTENTS
LETTER OF THE CHAIRPERSON OF THE APPOINTMENTS AND REMUNERATION COMMITTEE	4
INTRODUCTION	6
EXECUTIVE SUMMARY	7
Elica business strategy and key results	7
Elica's Remuneration Policy	8
Summary	10
SECTION I: REMUNERATION POLICY	12
1. GOVERNANCE OF THE REMUNERATION PROCESS	12
1.1	Bodies and parties involved	12
1.2 Appointments and Remuneration Committee	12
1.3	Board of Directors	14
1.4	Shareholders' Meeting	14
1.5 Appointment of independent experts	15
1.6	Process for defining and approving the Policy	15
1.7	Process for temporary exceptions to the Policy	16
2. PURPOSE, PRINCIPLES AND TOOLS OF THE REMUNERATION POLICY	16
2.1	Purpose of the Policy	16
2.2	Content and addressees of the Policy	17
2.3	Remuneration of Directors not holding special offices	17
2.4	Chairperson of the Board of Directors	18
	Pay mix	18
	Fixed remuneration	19
	Short-term variable incentive: MBO	19
	Non-monetary benefits	20
	Indemnity in the case of dismissal or termination of employment	21
	Non-competition agreements	21
2.5	Chief Executive Officer	21
	Pay mix	21
	Fixed remuneration	22
	Short-term variable incentive: MBO	22
	Long-term variable incentive: 2024-2026 Monetary Plan	23
	Non-monetary benefits	24
	Indemnity in the case of dismissal or termination of employment	24
	Non-competition agreements	24
2.6	Senior Executives	25
	Pay mix	25
	Fixed remuneration	26
	Short-term variable incentive: MBO	26
	Long-term variable incentive: Monetary plan	26
	Non-monetary benefits	26
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Remuneration Policy and Report
Indemnity in the case of dismissal or termination of employment	27
Non-competition agreements	27
Other provisions	27
2.7 Remuneration of the members of the Control Board	27
SECTION II: fees paid	28
Introduction	28
SECTION I	28
Fixed remuneration	28
Directors not holding special offices	28
Chairperson of the Board of Directors	28
Chief Executive Officer	28
Senior Executives	28
Short-term variable incentive 2023	29
Chairperson of the Board of Directors and Chief Executive Officer	29
Annual Monetary Incentive Targets	29
Senior Executives	29
Long-term variable incentive - 2016-2022 Phantom Stock and Co-investment Plan; 2019-2025 Phantom Stock and Co-investment Plan; 2021-
2023 Monetary LTI Plan	29
Chairperson of the Board of Directors	29
Chief Executive Officer	30
Senior Executives	30
Non-monetary benefits	30
Termination of office or employment	31
Senior Executives	31
Exceptions to the Remuneration Policy	31
Variable component ex-post correction mechanisms	31
Annual change in remuneration - Pay ratio	31
Vote cast by Shareholders' Meeting 2023	32
SECTION II	33
TABLE 1 Remuneration of the Board of Directors, Board of Statutory Auditors, and Senior Executives	33
TABLE 3A Financial instrument-based incentive plans, other than stock options, in favour of members of the Board of Directors and Senior
Executives	35
TABLE 3B Monetary incentive plans for members of the Board of Directors and Senior Executives	36
Schedule 7-ter Table 1 - Shareholdings of the Board of Directors and Statutory Auditors	37
Schedule 7-terTable 2 - Shareholdings of Senior Executives	38
GLOSSARY	39

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LETTER OF THE CHAIRPERSON OF THE APPOINTMENTS AND REMUNERATION COMMITTEE

Dear shareholders,

As Chairperson of the Appointments and Remuneration Committee (the "Committee"), I am pleased to submit for your attention Elica's 2024 Remuneration Policy and Report.

The Committee - which in 2023 comprised Directors Angelo Catapano, Monica Nicolini, Liliana Fratini Passi and Susanna Zucchelli, in addition to the undersigned - has drafted and submitted to the Board of Directors a Remuneration Policy which is designed to strengthen the alignment between the interests of Stakeholders and those of Management. It also seeks to support the continuous improvement in individual and company performance and the consequent creation of value over the medium to long term, in line with the indications of the Corporate Governance Code for listed companies.

The year's financial results were in line with expectations despite a sharply contracting market. The Company continued to perform well despite the challenges presented by an unstable macroeconomic environment that has been hit hard by inflation over the past two years and geopolitical tensions. Adjusted EBITDA stood at a 10.2% margin on revenues, remaining stable from the previous year. Adjusted EBIT was Euro 24.3 million, with a 5.1% margin on revenues, thus maintaining significant strength despite the lower revenues caused by reduced demand. The Company also expanded its direct presence in American distribution by acquiring Canadian distributor AG International, further strengthening its position in the American market. Elica will present its new product proposals for the cooking world at the upcoming EuroCucina / FTK 2024 event, confirming its ongoing commitment to offering innovative, quality solutions and continuing to expand its range.

These results confirm the strength of a cohesive team of men and women who have been clear about their goals and taken all the necessary measures to achieve them.

The company's strategy to enhance the value of its human resources is based on a people strategy that ensures the company has the necessary response tools to develop rapid solutions to increasingly complex problems, while simultaneously ensuring the growth and enhancement of all employees.

The Company's mission as regards People focuses on its ability to attract staff who fit Elica's corporate culture, promoting internal growth, recognising merit and improving motivation. To achieve these goals, during the year the Company introduced policies and actions that are consistent with these strategic pillars, by strengthening and simplifying the present performance measurement and rewarding policies.

Despite the challenging economic environment, which also necessitated the use of temporary flexibility solutions, the Company continued to invest in employee growth. 2023 saw the introduction of a new Performance Development system focused on behavioural drivers linked to current and future challenges for Elica. The system seeks to encourage self- development by promoting greater management accountability for employee growth and by strengthening the processes for succession planning, which are always monitored by the Company. A major training plan involving all company employees, both at headquarters and in the production plants, was also carried out in 2023, focusing on innovation and reskilling.

This important shift in the Company's people management systems over the past three years, along with the need to be more effective and quicker in responding to ongoing market challenges, led to a review of internal reward systems. This involved simplifying processes and systems and adopting more flexible and agile tools, which bring together long-term professional growth and short-term specific rewards in the event of extraordinary performance. An annual incentive system ("MBO") has therefore been designed which is consistent with the general principles that underpin the entire Policy. The main focus of the system is to orientate the work of all management towards strategic objectives, stimulating the achievement of excellent performance through the payment of a higher bonus in the event of overperformance. All incentives are, however, at all times linked to a Group threshold gate that guarantees sustainability.

The 2024 Remuneration Policy will continue to focus strongly on Stakeholder objectives that are in line with strategic goals and corporate values, but will also continue to be attentive to promoting a culture of equality and performance incentives. As part of its role, the Committee devoted a significant portion of its work in 2023 to the means of identifying, verifying and

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enacting the remuneration policy, making an unwavering commitment to continuous improvement through comparison with market best practices and within the framework of total adherence to current regulatory reference points.

In addition to optimising the systems that determine the variable component of management remuneration ("MBO") particular attention was paid to establishing sustainability-linked remuneration proposals also for the Company's Executive Directors.

In 2023, the Committee also worked on developing a long-term incentive plan (2024-2026) for the Chief Executive Officer, top management, and certain employees in key roles. The objective of this plan is to engage and motivate the team to achieve the targets of a particularly challenging three-year plan.

As it has always done, the Committee firmly believes that this document is an essential tool for clear and transparent communication of the Remuneration Policy to the market and investors, highlighting the role of the Policy in pursuing business strategy.

This report, prepared in accordance with Article 123-ter of Legislative Decree No. 58/1998, as amended, regarding transparency in the remuneration of Directors of listed companies, was adopted by the Board of Directors, which approved its contents on March 14, 2024. In compliance with the changes introduced by Legislative Decree No. 49 of May 10, 2019, the first section of this Report, which outlines the Remuneration Policy, will be submitted to the Shareholders' Meeting for a binding vote, while the second section on remuneration paid in 2023 will be submitted to the same Shareholders' Meeting for an advisory vote.

Confident that this Report reflects the Committee's commitment to the pursuit of increasingly clear, transparent, and effective communication of the Remuneration Policy and Report to all Stakeholders, I thank you for your endorsement and support of these policies.

Elio Cosimo Catania

Chairperson of the Appointments and Remuneration Committee

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Remuneration Policy and Report

INTRODUCTION

This Remuneration Policy and Report ("Report"), approved by the Board of Directors on March 14, 2024 on the proposal of the Appointments and Remuneration Committee, prepared pursuant to Article 123-ter of the CFA (Legislative Decree No. 58 of February 24, 1998, as amended), is divided into the following sections:

• SECTION I outlines the Policy adopted for members of the Governing Bodies and Senior Executives in 2024, describing its general philosophy, the bodies involved, and the procedures used to adopt and enact it;
  In compliance with Legislative Decree No. 49 of May 10, 2019, Section I of the Report is subject to a binding vote at the Shareholders' Meeting called to approve the Financial Statements at December 31, 2023.
• SECTION II sets out the remuneration paid in 2023 by name for Directors, Statutory Auditors, the Chief Executive Officer, and cumulatively for the other Senior Executives.
  In compliance with the provisions of Legislative Decree No. 49 of May 10, 2019, Section II of the Report is submitted to the advisory vote of the Shareholders' Meeting called to approve the 2023 Financial Statements.

The Policy described in Section I was prepared in line with the recommendations on remuneration set out in the Corporate Governance Code for listed companies, which Elica has adopted.

In this 2024 report, the Company has continued its mission to improve the quality of information provided to investors and the market in terms of transparency in the description of the Remuneration Policy and its application.

The two sections of the Remuneration Policy and Report are preceded by a paragraph in which some background information useful for reading the Remuneration Policy in relation to the Company's strategy is presented to the market and investors. This introductory section also presents an easy-to-read summary of the main elements of the Policy.

Finally, the second section of the Report includes an introduction that describes the application of the Policy for 2023.

This Report is made available to the public at Elica's registered office at Via Ermanno Casoli 2, Fabriano 60044, and on the Company's website (https://corporate.elica.com/it#governance)

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Remuneration Policy and Report

EXECUTIVE SUMMARY

Elica business strategy and key results

The three-year period 2021-2023 was a highly significant time for Elica, as the Company set itself apart as the key player in a Turnaround Project. During the period, Elica undertook a series of initiatives to improve margins and competitiveness in a complex global environment featuring a significant contraction in demand and high levels of inflation.

Thanks to a robust team, rapid execution and clarity of vision, Elica not only managed to protect its margins, but also launched major initiatives in the fields of products, distribution and communication. These initiatives are the foundation on which Elica will build its future developments.

Specifically, Elica's future priorities can be summarised as follows:

• Focus on sales, extending the Cooking Elica Brand range and strengthening the Motors BU, in terms of the technical and commercial development of products for the energy transition.
• Efficient cost management without compromising initiatives that generate a return in medium- to long-term growth.
• Maintaining a sound financial position.
• Focus on creating long-term value for shareholders.

Against this backdrop, Elica's Remuneration Policy, as a fundamental tool in pursuing medium-/long-term strategic objectives, pays particular attention to both short and medium-long-term incentive plans and is based on a strong alignment of the performance indicators with the pillars of the strategy.

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Elica's Remuneration Policy

Elica's Remuneration Policy is defined in accordance with the corporate governance model adopted by the Company and in line with the recommendations of the Corporate Governance Code. There have been no changes to the architecture of the previous years' plans.

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The table below shows the results of voting on the Remuneration Report in the past 5 years (voter %):

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Remuneration Policy and Report

Summary

A summary of the 2024 Remuneration Policy is presented below. This is without prejudice to the prerogatives of the next Shareholders' Meeting to approve the 2023 Financial Statements, on April 24, 2024, and of the new Board of Directors (which will take office with the same Shareholders' Meeting), to determine remuneration pursuant to Article 2389 paragraph 1 and paragraph 3 of the Civil Code.

Role	Purpose	Criteria and parameters	Quantitative references

Fixed remuneration

Chairperson

Chief Executive Officer
	Attract, retain and	Verification of salary positioning relative to
Directors, Chairpersons of	motivate highly	market salary levels based on assigned role
skilled personnel	and responsibilities
Committees
Directors, members of
Committees
Directors and Lead
Independent Director
Senior Executives

• Remuneration as per Article 2389, paragraph 3, Civil Code: Euro 541,000
• Gross Annual Remuneration: Euro 503,370
• Remuneration as per Article 2389, paragraph 3, Civil Code: Euro 390,000
• Gross Annual Remuneration: Euro 110,000
• Remuneration as per Article 2389, paragraph 1, Civil Code: Euro 50,000
• Remuneration as per Article 2389, paragraph 1, Civil Code: Euro 43,000
• Remuneration as per Article 2389, paragraph 1, Civil Code: Euro 44,000

Fixed remuneration is related to the role held and the responsibilities assigned to it

Short-term incentive plan

Chairperson

Chief Executive Officer

Promote achievement of annual targets and performance enhancement

Senior Executives

Targets:		Gross value awarded at target
• Adjusted EBIT (weighting 80%)	(achievement of 100% of targets):
• Free cash flow (weighting 20%).
Euro 100,000
(Targets also act as gates)
• Multiplier based on a sustainability goal:	Gross value awarded at target
+/-10%
(achievement of 100% of targets):
Pay-out curve: 45÷143, with a minimum
Euro 250,000 (equal to 62.5% of fixed
performance level below which no award is
remuneration net of non-competition
provided.
	components)
Plan subject to malus and clawback.
Targets:
• Group targets (also act as a gate)
o	Adjusted EBIT
o	Free Cash Flow	Gross value awarded at target
• Division targets
(achievement of 100% of targets): up
• Individual targets
• Multiplier based on a sustainability goal:	to a maximum of 50% of fixed
+/-10%	remuneration and commensurate with
Pay-out curve: 11÷213, with a minimum	role
performance level below which no award is
provided.
Plan subject to malus and clawback.

Long-term incentive plan

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