Royal KPN N : KPN Explanatory Note on Remuneration Policy Renewal for AGM 2024

Explanatory note on updated KPN Remuneration Policy for Board of Management

and Supervisory Board

Dear Shareholders,

We are pleased to present this explanatory note regarding the updated Remuneration Policy for our Board of Management and our Supervisory Board. The Remuneration Policy was last amended in April 2020, and a revised version is now submitted for approval to the 2024 Annual General Meeting (AGM) in accordancez with applicable legislation. This document outlines key changes proposed to the policy, reflecting our commitment to our recently announced Connect, Activate & Grow strategy, compliance with Dutch Corporate Governance Code and response to evolving market dynamics.

Background: The Remuneration Policy serves as a critical aspect of corporate governance, ensuring alignment with the interests of a broad set of stakeholders and compliance with Dutch legislation, including the Dutch Corporate Governance Code. The policy adheres to principles promoting sustainable long-term value creation, transparency, and a balanced remuneration structure.

Review and Renewal: In adherence to applicable legislation and corporate governance principles, the Supervisory Board periodically reviews the Remuneration Policy. The proposed renewal is the result of a comprehensive evaluation conducted by the Remuneration Committee, taking into account relevant legal requirements, guidelines set forth in the Dutch Corporate Governance Code and a thorough Stakeholder Engagement process. The proposed amendments are a result of careful consideration by the Remuneration Committee, taking into account evolving market practices and regulatory requirements.

Key Components of KPN's Remuneration Policy:

1. Performance-BasedCompensation
2. • The policy places a strong emphasis on performance-based components, aligning executive compensation with the company's strategic objectives
   • Variable components, such as short-term incentives and long-term incentives, will be structured to reflect the company's financial performance and stakeholder value creation
3. Transparent Communication
4. • KPN recognizes the importance of transparent communication in accordance with applicable legislation. The renewed policy aims for enhanced disclosure of performance metrics, targets, and the rationale behind compensation decisions

Proposed Amendments to the 2020 Remuneration Policy:

1. Peer Group Update

• The peer group used to benchmark pay levels for the Board of Management has been updated to accurately reflect our company's current position and peers in the market.

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The employment market peer group consists of Dutch-listed and European sector- specific companies, based on a mixed set of criteria like Market Capitalization, Revenues, Employees, Total Assets or Strategic Importance. Based on the review, ASML, Ahold Delhaize and Iliad (included in the peer group of the 2020 Remuneration Policy) are replaced by ASMI, IMCD and British Telecom to ensure that the Peer Group is accurate for KPN

2. Board of Management Remuneration Policy

• Financial Targets in LTI Structure: The proposed amendment involves an adjustment of the Financial Targets in the LTI Structure. In the current 2020 policy, relative Total Shareholder Return (TSR) and cumulative Free Cash Flow (FCF) accounted for 70% of the target set in the LTI structure (TSR 25% and FCF 45%). Given our Connect, Activate & Grow strategy for the period 2024-2027, KPN acknowledges the importance of adding Return on Capital Employed (ROCE) to the financial target set of the LTI Structure. An LTI Structure with TSR, FCF and ROCE strikes the right balance between Shareholder value-creation, Free Cash Flow generation for future investments and Capex discipline (measured through ROCE). FCF remains a component of both STI and LTI plan in the new policy albeit with a lower weighting in the LTI plan compared to the 2020 policy. Both the FCF target in the STI and LTI plan are featured by their own dynamics. Additionally, FCF is considered an important driver for dividend distribution and the development of share prices, in addition to the factors mentioned earlier.

In this proposed amendment, the weights of the financial targets in the LTI Structure have therefore been adjusted. The weight of relative TSR is increased from 25% to 30%, the weight of cumulative FCF is reduced from 45% to 20%, and Return on Capital Employed (ROCE) is introduced with a weight of 20%

• Introduction of Buy-OutProvision: The Supervisory Board proposes to include a buy- out provision in the Remuneration Policy, enabling the Supervisory Board to apply this provision within the initial year of hiring, if it deems this necessary to attract external candidates for a potential appointment to the Board of Management. It is essential to note that this provision will only be offered under exceptional circumstances within the initial year of their tenure with the company The buy-out will be offered as much as possible in a 'like-for-like' construction, whereby the principles of KPN's Remuneration Policy apply. Finally, KPN shares are the preferred instrument to cater for this instrument

3. Supervisory Board Remuneration Policy

• Fee Level Revisions: The Supervisory Board proposes revisions to the fee levels for the first time since 2011. In evaluating the current fee structure, the Supervisory Board considered peer group fee structures within the employment market and general Collective Labor Agreement (CLA) increases as significant points of reference

Policy Continuity: In all other substantial aspects, the proposed Remuneration Policy remains consistent with the policy ratified during the General Meetings of Shareholders in April 2020. This continuity ensures stability while allowing for necessary adjustments in response to changing circumstances.

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The Supervisory Board believes that the proposed amendments to the Remuneration Policy strike the right balance between rewarding performance, alignment with the Connect, Activate & Grow strategy, being able to attract top talent, promoting good corporate governance and securing the interests of our stakeholders. We value your input, and we encourage you to review the detailed policy document accompanying this explanatory note for a more comprehensive understanding. Your support at the AGM is crucial to the successful implementation of these proposed changes.

Sincerely,

Ben Noteboom

Chair Remuneration Committee KPN

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