REPORT BY THE SUSTAINABILITY, CORPORATE GOVERNANCE, APPOINTMENTS AND REMUNERATION COMMITTEE OF PROSEGUR CASH, S.A.

ON THE PROPOSAL FOR THE DIRECTORS' REMUNERATION POLICY

The Sustainability, Corporate Governance, Appointments and Remuneration Committee (the "Committee") of the Board of Directors of Prosegur Cash, S.A. (the "Company") issues this report in relation to the proposal for the approval of the director's remuneration policy of the Company which is to be submitted to the binding vote of the General Shareholders' Meeting, pursuant to article 529 novodecies of the Capital Companies Law

(Ley de Sociedades de Capital).

1.

GENERAL PRINCIPLES OF THE REMUNERATION POLICY

The bases and principles of the directors' remuneration policy of the Company are laid down in article 27 of the Company's bylaws.

The directors' remuneration policy of the Company (the "Remuneration Policy"), which is to be submitted to the General Shareholders' Meeting for approval, is aimed at ensuring that the remuneration of the Company's directors is in line with their dedication and liability and consistent with the remuneration paid on the market by comparable companies at national and international level, bearing in mind the long-term interests of all shareholders.

The Remuneration Policy is based on the following principles and criteria:

  • (i) creation of long-term value of the Company, aligning the remuneration schemes with the strategic plan;

  • (ii) attraction, motivation and retention of the best professionals;

  • (iii) responsible achievement of objectives, in accordance with the Company's risk management policy; and

(iv)

transparency in the remuneration policy.

The Remuneration Policy, to be submitted to the General Shareholders' Meeting for approval, follows the same principles as the policy currently in force, approved in 2020, which is to remain in force through December 31, 2022. It does not include any significant change, other than to reflect the Global Optimum Plan approved by the 2021 General Shareholders' Meeting.

2.

MAIN ELEMENTS OF THE REMUNERATION POLICY

This Remuneration Policy distinguishes between the remuneration scheme for holding office as director, as such, and the remuneration scheme for the discharge of executive functions by executive directors.

  • 2.1 Remuneration scheme for holding office as director, as such

    The total remuneration payable by the Company to all its directors, as such, cannot exceed the maximum amount stipulated for such purpose by the General Shareholders' Meeting, which amount will remain in force until the General Shareholders' Meeting resolves to modify it. Accordingly, at the Company's General Shareholders' Meeting held on February 6, 2017, those present resolved to stipulate €1,500,000 as the maximum amount of total annual remuneration payable by the Company to all its directors, as such.

    The Board of Directors must set the exact amount payable within this limit and determine its allocation among the various directors, at the proposal of the Committee.

    The remuneration of directors, as such, is structured, within the statutory and bylaw framework, around the following items:

    • (i) Annual fixed allowance

      Each year directors receive a fixed amount in line with market standards, having regard to the offices they hold on the Board of Directors and on the Committees on which they sit, at all times bearing in mind the limit on the remuneration of directors, as such. It is paid on a quarterly basis.

    • (ii) Attendance fees

      Directors receive fees for attending meetings of the Board of Directors and of the Committees on which they sit.

  • 2.2 Remuneration scheme for the discharge of executive functions

    The remuneration receivable by executive directors for the discharge of executive functions at the Company, is structured as follows:

    • (i) Fixed remuneration

      Determined having regard to the substance of the executive functions attributed to them, and to the fact that this part of the remuneration must be in line with the remuneration paid on the market by comparable companies in terms of capitalization, volume and international implementation.

    • (ii) Remuneration of the post-contractual non-competition clause

      If the executive director's contract includes a post-contractual non-competition clause, the executive director's remuneration may include a suitable fixed cash amount, payable periodically, as remuneration for the director's submission to the clause.

(iii)Variable remuneration

The variable remuneration of executive directors is aimed at strengthening their commitment to the Company and creating an incentive for the optimum discharge of their functions. It comprises:

  • a) Short-term variable remuneration (annual bonus): The annual bonus will be payable in cash and will be linked, for the most part, to the achievement of the Company's economic-financial objectives, as well as to the performance of personal objectives. The target amount cannot exceed 80% of the annual fixed remuneration and the maximum amount, 150% of such remuneration.

  • b) Medium- and long-term variable remuneration (long-term incentives -

    Global Optimum Plan and ILP): medium- and long-term incentive schemes related, for the most part, to the Company's performance in

    connection with certain economic-financial parameters aligned with the

    Company's strategic objectives, with a view to retaining and motivating

    executive directors and creating long-term value.

    In this connection, on June 2, 2021 the General Shareholders' Meeting of the Company approved two long-term incentive plans.

    1) The Global Optimum Plan is a long-term remuneration scheme related to the performance of specific objectives linked to the "Global Optimum" Digital Transformation Plan in which Prosegur Cash, S.A.

is involved, and to a director's minimum stay in the Group, with a view to boosting the Group's digital transformation during the 2021-2023 period, as well as retaining and motivating its beneficiaries. The objectives of the Global Optimum Plan are linked to the performance of the Group's digital transformation objective (Global Optimum) having regard to the position held by the beneficiary, the scope of his or her liability and, where appropriate, to personal objectives; the creation of value is calculated having regard to metrics significant to the business during the reference period. Under the Global Optimum Plan, the incentive is paid through the award of shares in Prosegur Cash, S.A.

Each beneficiary is allotted a specific number of units ("Units") which will determine the number of shares able to be awarded under the plan.

One share in Prosegur Cash, S.A. is to be received, as the case may be, for each Unit.

A maximum of 6,701,806 common shares have been allotted to the Global Optimum Plan, each with a par value of 0.02 euros, representing 0.4339% of the capital stock of Prosegur Cash, S.A. on the date of the resolution, of which up to 4,628,946 common shares, each with a par value of 0.02 euros, may be allotted to the ExecutiveChairman and to the Chief Executive Officer.

With respect to the shares' award date, two possible models are envisaged:

- award of all shares in March 2024; or

- award of 33% of the shares in October 2022, 33% in October 2023 and the remaining 34% in October 2024.

The Global Optimum Plan runs from 2021 through 2023 (the reference performance period) for the receipt of all or part of the incentive, and the shares are to be awarded on the appropriate dates according to each of the two possible models envisaged in the Regulations of the Global Optimum Plan for the shares' award date.

2) The 2021 ILP (incentivo a largo plazo or long-term incentive) is a long-term remuneration scheme related to the performance of

Prosegur Cash, S.A. in connection with certain parameters aligned with its 2021-2023 strategic plan, aimed at retaining and motivating its beneficiaries and creating long-term value for the shareholder.

The objectives of the 2021 ILP are linked to the creation of value at

Prosegur Cash, S.A. at global or unit (region, country) level, having regard to the position held by the beneficiary, the scope of his or her liability and, where appropriate, to personal objectives. The creation of value is calculated having regard to metrics significant to the business during the reference period.

The 2021 ILP includes the payment of the incentive in cash and/or through the award of shares in Prosegur Cash, S.A. In the case of the Executive Chairman, the payment of the incentive will be made through the award of shares in Prosegur Cash, S.A. and in the case of the Chief Executive Officer, through the award of shares in

Prosegur Cash, S.A. and cash. Pursuant to the Plan's Regulations, exceptionally, if the Company deems it impossible or inadvisable to award shares, it can resolve to make a cash settlement of this part of the Plan, replacing the award of the shares with an equivalent cash amount.

As the case may be, each beneficiary will be allotted a specific number of units ("Units"), which will determine the number of shares able to be awarded under the plan.

One share in Prosegur Cash, S.A. is to be received, as the case may be, for each Unit.

A maximum of 7,894,409 common shares have been allotted to the 2021 ILP, each with a par value of 0.02 euros, representing 0.5111%of the capital stock of Prosegur Cash, S.A. on the date of the resolution, of which up to 5,826,918 common shares, each with a par value of 0.02 euros, may be allotted to the Executive Chairman and to the Chief Executive Officer.

With respect to the payment dates, three possible models are envisaged:

  • (i) The Executive Chairman will be awarded the shares, as the case may be, within sixty (60) calendar days after the issue of the related auditor's report on the Group's 2023 consolidated financial statements.

  • (ii) For cases in which payment is to be made through the award of shares in Prosegur Cash, S.A. and cash, including that of the Chief Executive Officer, the payments will be made as follows: a. Within sixty (60) calendar days after the issue of the related auditor's report on the Group's 2023 consolidated financial statements, fifty percent (50%) of the cash incentive will be paid and fifty percent (50%) of the related shares will be awarded ("First Payment Date").

    b. Within thirty (30) calendar days after the first anniversary of the First Payment Date, fifty percent (50%) of the incentive will be paid in cash.

    c. Within thirty (30) calendar days after the second anniversary of the First Payment Date, the remaining fifty percent (50%) of the related shares will be awarded.

  • (iii) For cases in which payment is to be made in cash, the payments will be made as follows: a. Fifty percent (50%) will be paid on the First Payment Date.

    b. Twenty five percent (25%) will be paid within thirty (30) calendar days after the first anniversary of the First

    Payment Date.

    c. The remaining twenty five percent (25%) will be paid within thirty (30) calendar days after the second anniversary of the First Payment Date.

The 2021 ILP runs from 2021 through 2023 (reference performance period), and the payment date(s) will be the appropriate dates according to each of the three possible 2021 ILP payment date models.

The 2021 ILP includes a clawback clause under which beneficiaries agree to return the amount of any variable remuneration received, if evidence is given that the payment was not consistent with the stipulated performance conditions or was made on the basis of data

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Prosegur Cash SA published this content on 28 April 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 April 2022 08:21:05 UTC.