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Care Property Invest NV/SA
Remuneration Information • Apr 24, 2025
3926_rns_2025-04-24_2341ced2-a2a1-4f73-b326-27a2787d0b07.pdf
Remuneration Information
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Free translation. The Dutch version prevails.
CARE PROPERTY INVEST public limited liability company Public Regulated Real Estate Company (RREC) under Belgian Law Horstebaan 3, 2900 Schoten, Belgium Company registration number 0456.378.070 (RPR Antwerp, Antwerp division) (the "Company")
REMUNERATION POLICY
Remuneration policy to be submitted to the 2025 annual general meeting
1. General
1.1. Introduction
This remuneration policy sets out the principles that Care Property Invest NV (the Company) applies for the remuneration of its directors and executive management. It has been drawn up and will be applied in compliance with Article 7:89/1 of the Belgian Code for Companies and Associations (BCCA) and Principle 7 of the Belgian Corporate Governance Code 2020 (Code 2020).
The Company believes that this remuneration policy enables it to attract, reward and retain the necessary talent. The performance criteria used by the Company to determine the level of variable remuneration encourage the achievement of the Company's strategic objectives and sustainable value creation. At the same time, they also translate the risk appetite as set by the board of directors and the rules of conduct the Company is required to observe.
The Company actively consulted with relevant stakeholders during the drafting of this policy. These include the top - 20 investors who do not have a contract with a proxy holder and the relevant proxy holders for shareholders who have entered into such a contract. Shareholders' feedback was taken into account when drafting this remuneration policy and shareholders who abstained or voted against at the ordinary general meeting regarding the remuneration report were contacted and their feedback was obtained and taken into account in the drafting of this remuneration policy.
1.2. Approval by the general meeting
This policy was drawn up by the Board of Directors on the basis of the recommendations of the nomination and
remuneration committee. It will be submitted to the Annual General Meeting in 2025 for approval.
1.3. Scope of application
The remuneration policy applies to the persons referred to in Article 7:89/1, §1 of the BCCA. In concrete terms, this concerns the directors of the Company and the members of executive management.
Subject to the approval by the 2025 annual general meeting, the remuneration principles contained hereinafter will apply to the remuneration of the members of the board of directors and the members of executive management as from financial year 2025.
T +32 3 222 94 94 E [email protected] W carepropertyinvest.be
Belfius BE27 0919 0962 6873 BTW BE 0456 378 070 RPR Antwerpen – Afdeling Antwerpen
Building a Caring Future Together
If this remuneration policy is not approved by the 2025 general meeting, the current remuneration policy as approved by the 2022 general meeting ('2022 remuneration policy') will continue to apply and the board of directors may submit a revised remuneration policy to a subsequent general meeting.
In case of a material amendment, and at least every four years, the remuneration policy shall be submitted for approval by the general meeting. The board of directors may approve non-material changes to the remuneration policy without the approval of the general meeting.
For the avoidance of doubt, to the extent that the remuneration policy provides for the possibility to grant remuneration that deviates from the restrictions on variable and share-related remuneration contained in sections (7:121, paragraph 4 iuncto) 7:91 and 7:121 BCCA, the approval of the remuneration policy by the general meeting shall constitute express approval of these deviations.
2. Governance – procedure
2.1. Role of the nomination and remuneration committee
The nomination and remuneration committee is a specialised board committee. It is composed exclusively of non-executive directors, the majority of whom are independent directors, and its mission is to provide the board of directors with objective and independent advice regarding the remuneration policy and its application.
The nomination and remuneration committee assumes the role, responsibilities and powers set forth in Section 5, 'Nomination and remuneration committee' of the Company's Corporate Governance Charter (the Charter). The committee advises the board of directors on matters, including but not limited to:
- the preparation and proposal of the remuneration policy;
- the determination of the remuneration of individual members of executive management;
- the determination of the performance targets of the members of executive management in the short and medium or long term;
- the annual evaluation of the performance of members of executive management in relation to the predetermined performance criteria and its translation in terms of the payment of the variable remuneration; and
- the preparation and proposal of the annual remuneration report to the general meeting.
2.2. Role of the board of directors
The role, responsibilities and powers of the board of directors are set out in section 3.6 'The role of the board of directors' and other parts of the Charter.
In particular, the board of directors, as the ultimate responsible party, decides on the recommendations of the nomination and remuneration committee, on:
- the remuneration policy proposal;
- the determination of the remuneration of individual members of executive management;
- the determination of the performance targets of the members of executive management in the short and medium or long term;
- the annual evaluation of the performance of the members of executive management in relation to the predetermined performance criteria and the translation thereof in terms of the payment of the variable remuneration; and
- the annual remuneration report which, as part of the annual report, is submitted to the general meeting for advice.
2.3. Role of the general meeting
The general meeting approves the remuneration policy in a binding manner by simple majority of the votes cast.
The general meeting decides on the remuneration of the directors by simple majority of the votes cast.
2.4. Management of conflicts of interest
Nobody decides on his or her own remuneration:
- the remuneration of non-executive directors is proposed to, and then adopted by, the general meeting;
- the members of executive management who are also a director do not take part in the discussions and decision making concerning their remuneration within the board of directors;
- the nomination and remuneration committee meets in the absence of the members of executive management at any time if it deems this necessary.
2.5. Evaluation of remuneration
The remuneration policy and its application are regularly evaluated by the nomination and remuneration committee.
At least every four years, the remuneration policy is resubmitted to the general meeting for approval.
Material changes to the policy shall only apply provided that they have been approved by the general meeting. The board of directors may approve non-material changes to the remuneration policy without the approval of the general meeting.
3. Material changes compare to the previous remuneration policy
Upon recommendation of the nomination and remuneration committee, the board of directors proposes the following structural changes:
3.1. Changed composition of the executive committee
During FY2024, the composition of the executive committee changed as follows:
- Mr. Willy Pintens and Mr. Dirk Van den Broeck resigned as members of executive committee effective 1 July 2024;
- Mr. Philip De Monie and Mr. Willem Van Gaver were appointed as members of executive committee effective 1 July 2024.
An important difference between the old composition and the new composition, is that in the new composition the executive committee consists exclusively of persons performing full-time operational management services to the Company. Consequently, the distinction within the executive management between 'members of the college of daily management other than the CEO, CFO and COO' on the one hand and 'the CEO, CFO and COO as effective leaders' on the other hand is no longer relevant. This distinction is removed and merged under the remuneration policy section for executive management.
3.2. Changes to the variable remuneration for executive management
The balance between the different components of the remuneration is adjusted. In particular, the ratio between the fixed remuneration on the one hand and the short-term bonus (STI) and long-term bonus (LTI)
on the other was revised. As a result, the ratio between short-term bonus and long-term bonus changed as follows:
| Fixed remuneration (previous: 2024) |
Fixed remuneraiton (proposed) |
STI (previous: 2024) % fixed |
STI (proposed) % fixed |
LTI (previous: 2024) % fixed |
LTI (proposed) % fixed |
|
|---|---|---|---|---|---|---|
| CEO | 100% | 100% | 50% | 50% | 26% | 31,75% |
| CFO/COO | 100% | 100% | 50% | 50% | 37,90% | 36,80% |
| CLO/CBDO | N.a. | 100% | N.a. | 50% | N.a. | 34,62% |
However, the above table does not take into account the changes made to the short-term incentive (STI), where under the 2022 remuneration policy, 50% of the STI was calculated and paid out over a two-year performance period (25%) and a three-year performance period (25%), while under the new remuneration policy, 100% of the STI will be calculated and paid out over a one-year performance period.
Due to the decrease in the fixed remuneration of the new CEO compared to previous CEO, the share of the LTI compared to the fixed remuneration increases. For the other members of the executive management, the amount of the LTI was set equal, resulting in a slight decrease in the LTI's share of the total remuneration of the CFO and COO (but which is at the highest level of all members of the executive management) and a share of the LTI in the total remuneration of the new members of the executive management (CLO and CBDO) that is close to the average of the LTI's share of the CEO's remuneration on the one hand and COO and CFO on the other.
The new remuneration policy and the changed structure of executive management's variable remuneration are applicable from FY2025. The short-term and long-term bonuses granted (conditionally) up to and including financial year 2024 remain fully applicable and will continue to be paid according to the terms of the 2022 remuneration policy and the bonus regulations drawn up in accordance with the 2022 remuneration policy.
As a result of these changes, the composition of the variable remuneration no longer meets the requirements of Article (7:121(4) iuncto) 7:91(2) of the BCCA which stipulates that at least one quarter of the variable remuneration must be based on predetermined and objectively measurable performance criteria over a period of at least two years, and at least another quarter must be based on predetermined and objectively measurable performance criteria over a period of at least three years. Accordingly, in accordance with Article (7:121(4) iuncto) 7:91(2) of the BCCA, this deviation will be submitted to the general meeting for approval together with the approval of the remuneration policy.
3.3. Changes to the minimum threshold of shares to be held by executive management
While the minimum threshold of shares of the Company to be held by executive management was included in the 2022 remuneration policy as a nominal number, in the 2025 remuneration policy it was opted to define it as a minimum acquisition value. Thereby, the minimum acquisition value in shares of the Company for each member of the executive management is set at 50% of the gross amount of the annual fixed remuneration as of 1 January 2025. In the 2022 remuneration policy, the minimum threshold was set at 15,000 shares for the CEO and 6,500 shares for the CFO and COO, which means that overall, replacing this minimum threshold with the 50% of the gross amount of annual fixed remuneration as of 1 January 2025 is stricter compared to the previous remuneration policy and stricter than the Belgian peers.
3.4. Changes to the performance criteria for the variable remuneration of executive management
In general, the board of directors will take a diligent approach in the performance criteria selection ensuring that the performance criteria are appropriate and relevant in assisting the achievement of the company's
short and long term goals. Several investors were consulted in this respect and their feedback was taken into account for both the choice of the KPIs themselves and the targets to be reached. Criteria are set to be considered stretch and sufficiently challenging, clearly measurable and quantifiable for each relevant performance period. The board of directors intends to provide full disclosure around the performance criteria and their achievement levels in the relevant remuneration report after the end of the relevant performance period.
Overall the criteria and their weights is kept unchanged compared to the previous remuneration policy (slight change in the weights within the financial criteria).
More changes were made to the LTI.
EPS is considered to be more relevant compared to DPS and share price evolution in the previous remuneration policy to capture the total shareholder return.
Both the STI and LTI provide for operating cost as a performance criterium, whereby the operating cost criterium in the LTI aims at improving the level of the operating costs.
Net debt/EBITDA has been introduced as a performance criterium to keep the risk profile in terms of solvency /LTV of the company conservative.
Meanwhile, the board of directors has opted to step away from portfolio growth as a performance criterium because we consider that growth is only desirable if it's EPS accretive and doesn't compromise the company's risk profile. These criteria are now embedded in the current KPIs.
The ESG performance criteria will be filled in differently between the LTI and STI by the board of directors for each of the relevant performance periods. ESG has a larger weight compared to the previous remuneration policy given its growing importance.
4. Remuneration policy for non-executive directors
4.1. Structure
A. Fixed annual fee
The non-executive directors are entitled to a fixed annual fee.
The chairman of the board of directors receives a fixed annual fee of EUR 20,000. The other directors receive a fixed annual fee of EUR 10,000. The annual fixed fee is flat rate, fixed and not subject to indexation.
These amounts were first approved by the general meeting of 29 May 2019. They were proposed by the board of directors based on the unanimous recommendation of the nomination and remuneration committee.
B. Attendance fees
In addition to the fixed annual fee, the non-executive directors receive an additional fee in the form of attendance fees for the meetings of the board of directors and of the different committees.
The amounts of the attendance fees were first set by the general meeting of 29 May 2019 at EUR 750 per meeting of the board of directors, the audit committee, the nomination and remuneration committee or the investment committee (the latter was first decided at the general meeting of 26 May 2021). The attendance fees are flat rate and not subject to indexation.
All fees are flat-rate, fixed fees and not subject to indexation.
C. Expense allowances
The non-executive directors may be reimbursed for expenses directly incurred in relation to the performance of their duties as directors, upon presentation of supporting documentation, in accordance with the Company's general expense reimbursement policy.
D. No other remuneration components
Non-executive directors receive no variable remuneration, pension benefits or other benefits in kind.
Nor does the Company pay non-executive directors in shares (not even partially). In doing so, the Company deviates from recommendation 7.6 of the Code 2020. The Company justifies this deviation by the fact that such remuneration in shares is not customary in Belgian listed companies in general or more specifically, in the RREC sector. The Company takes the view that the assessment capacity of these directors, in particular as non-executive directors, will not be harmed by the absence of remuneration in shares. To the Company's knowledge, there is also no international consensus yet that share based remuneration guarantees that the interests of non-executive directors are aligned with the shareholders' interests. The Company has decided to await the further development of the practice of Belgian listed companies in general, and more specifically in the RREC sector and to regularly reconsider whether it could be in the interests of the Company and its shareholders to proceed to (partial) payment of non-executive directors in shares.
4.2. Contribution to the corporate strategy, the long-term interests and the sustainability of the Company
As an RREC specialised in health care real estate in Belgium, Ireland, the Netherlands and Spain, the Company takes the view that its non-executive directors are best remunerated on a fixed basis. The fixed nature of the fees should safeguard the objectivity of the non-executive directors in monitoring the Company's performance. The level of the amounts should allow the Company to safeguard the commitment of the directors and ensure the right combination of expertise and diversity within the board of directors to stimulate the success of the Company in the long term.
4.3. Main conditions of the agreements
The non-executive directors perform their mandate as self-employed persons in accordance with Article 7:85 §1, (3) of the BCCA. Their director's mandate is for a maximum of four years. This mandate can be renewed for nonexecutive directors without limitation by periods of up to four years. The general meeting may revoke these mandates at any time, without notice or compensation, by a simple majority decision.
5. Remuneration policy for the executive management
5.1. Overview
The executive management of the Company shall include the persons in charge of the daily management and any other persons in charge of the management referred to in Article 3:6, §3, third paragraph of the BCCA. The remuneration of the members of executive management is determined by the board of directors taking into account the advice of the nomination and remuneration committee.
T +32 3 222 94 94 E [email protected] W carepropertyinvest.be
Belfius BE27 0919 0962 6873 BTW BE 0456 378 070 RPR Antwerpen – Afdeling Antwerpen Building a Caring Future Together
To align the interests of the members of executive management with sustainable long-term value creation, part of their remuneration is linked to the realisation of the objectives determined by the board of directors. This approach includes both short-term bonus and long-term bonus.
The relative proportions of the components of remuneration are as follows:
| CEO | CFO and COO | CLO and CBDO | |
|---|---|---|---|
| Component | Relative % | Relative % | Relative % |
| compared to the | compared to the | compared to the | |
| fixed remuneration | fixed remuneration | fixed remuneration | |
| Fixed remuneration (including representation allowances and insurances*) |
|||
| Short-term incentive | On target: 50% | On target: 50% | On target: 50% |
| Cap: 60% | Cap: 60% | Cap: 60% | |
| Long term incentive | On target: €200.000 | On target: €150.000 | On target: €90.000 |
| Cap: €240.000 | Cap: €180.000 | Cap: €108.000 | |
| Benfits in kind | <1% | <1% | <1% |
* The total amount of the fixed remuneration that can be used for insurances (life, death, disability), including taxes and costs, is approximately 50%.
5.2. Relationship with the salaries and working conditions of the employees
When drawing up this remuneration policy, the salaries and working conditions (including a bonus system) of the Company's employees were taken into account. The Company provides for consistency between the remuneration of the members of executive management and the compensation of employees in order to attract, reward and retain the necessary talent, taking account of the market conditions for each category of employees. It does this on the one hand by benchmarking the remuneration of the respective employee against the same (or a comparable) position/function within other (comparable) companies in the sector, as is done for the members of executive management, and on the other hand based on negotiations with the employee concerned. In addition, annual evaluations are held, in the context of which remuneration is also always assessed. These always take into account how the employees can not only contribute but also share in the growth of the Company and the earnings per share of the Company. A bonus is granted to the Company's employees in that context and according to their performance (among others, paid in accordance with the provision regarding the CLA90 bonus).
5.3. Benchmark
When negotiating the management agreements of the members of executive management, as well as during evaluations and renegotiations, the Company bases the fixed remuneration partly on benchmarking with the sector and negotiation with the parties concerned, and partly on the growth of the Company in terms of market capitalisation, personnel and countries in which the Company operates.
The Company bases the determination of the variable remuneration and other elements of the remuneration package of the members of executive management on (i) the previously allocated fixed remuneration, (ii) a benchmarking with the sector and (iii) corporate governance provisions.
Care Property Invest nv Horstebaan 3 2900 Schoten
Belfius BE27 0919 0962 6873 BTW BE 0456 378 070 RPR Antwerpen – Afdeling Antwerpen
The peer group identified by the Company in this regard consists of a group of European listed REITs, including direct sector peers in the Healthcare segment and other EU REITs active in Spain, Ireland and the Netherlands, which are currently key countries for the Company's operations. More specifically, the Company selected the following companies for its benchmarking exercise: Cofinimmo, Aedifica, Icade, Immobiliaria Colonial SOCIMI, XIOR Student Housing, Montea. The first two companies were given a 25% weight in the peer group, while all other companies were given a weight of 12.5%. The choice was motivated by the similarities between the business model of the peer group and that of the Company. Overall, management's remuneration is close to the peers' average, especially taking into account the seniority of some members of management in the company and in the labour market.
5.4. Description of the fixed remuneration
The management agreements of the members of executive management determine the fixed remuneration for their performance. The fixed remuneration of the members of executive management is indexed annually based on the health index. The fixed remuneration included in the management agreements is fixed and no increase will be applied above the indexation during the term of this remuneration policy.
The fixed remuneration of the members of executive management to whom the 2022 remuneration policy applied (i.e. the COO and the CFO) will remain unchanged and will not be increased above indexation. For the new members of executive management who joined during 2024, the Company is of the opinion that their fixed remuneration is justified in view of (i) a benchmarking exercise carried out which shows that the fixed remuneration is in line with the market and in line with the fixed remunerations applied at industry peers (ii) the ratios between the fixed remunerations of the various members of executive management, whereby the fixed remuneration of the newly joined CLO and CBDO is lower than the fixed remuneration of the existing members, (iii) the role they hold within the Company and the corresponding responsibilities and (iv), for the new CEO, the fact that the fixed remuneration is lower than the previous CEO. Also for the CLO and CBO, the fixed fees agreed at the start of the current remuneration policy will remain unchanged during the term of this remuneration policy and will not be increased above indexation.
The members of executive management do not receive separate remuneration for the performance of their duties as directors, if applicable.
5.5. Description of the variable remuneration
A. Short-term Incentive (STI)
All members of executive management are entitled to an annual short-term incentive (STI) dependent on the achievement of collective targets over a performance period of one (1) financial year in accordance with the terms and conditions set out below.
The effectively earned short-term bonus will be determined based on the extent to which the following measurable and quantitative performance criteria are achieved, each time also reflecting the weighting factor:
| Performance criteria | Stratigic objective | ||||
|---|---|---|---|---|---|
| Criteria | Weight | ||||
| Fin an cia l |
EPS compared to budget | 60% | Creating value for shareholders | ||
| Operating cost | 15% | Creating value for shareholders | |||
| Total | 75% | ||||
| fin No an n cia l |
ESG-targets | 25% | Future-proofing the real estate portfolio and relationships with key stakeholders |
||
| Total | 25% |
The board of directors, on the recommendation of the nomination and remuneration committee, will set the performance criteria in the first three months of the relevant one-year performance period. The board will ensure that the performance criteria are different for the STI and the LTI.
The envisaged short-term incentive corresponds 'on target' to an amount equal to 50% of the annual fixed remuneration. The short-term incentive will vary between 0 and 60% of the annual fixed remuneration, depending on the achievement of the performance criteria. The threshold values (threshold), targets and maximum performance levels are determined for each of the performance criteria individually by the board of directors in the first three months of the relevant one-year performance period based on a number of internal and external benchmarks. The performance targets are ambitious but achievable, taking into account the specific strategic priorities and economic climate in a given year. For bonus purposes, the performance target usually requires a significant improvement on the previous year's result, and for financial measures, the targets are usually in line with the upper limit of the market consensus.
The extent to which the performance criteria were met for a given performance period will be calculated for each of the performance criteria as follows:
| Bonus (% target bonus) (pay-out zone) |
||
|---|---|---|
| Actual performance below the threshold value | 0% | |
| Actual performance between the threshold value and the target |
80% - 100% (pro rata) | |
| Actual performance on target | 100% | |
| Actual performance between target and the maximum performance level |
100% - 120% (pro rata) | |
| Actual performance above the maximum performance level |
120% (capped) |
The board of directors, on the advice of the nomination and remuneration committee, after approving the Company's annual results, determines the extent to which the financial and non-financial performance criteria were met for the previous one-year performance period and, on that basis, determines the amount of short-term incentive eligible for payment for each member of the executive management.
The short-term incentive is paid in cash in the year following the one-year performance period and immediately after its determination by the board of directors.
Care Property Invest nv Horstebaan 3 2900 Schoten
B. Long-term Incentive (LTI)
To ensure that the interests of the members of executive management are further aligned with the longterm shareholder interests, all executive management members are also entitled to an annual long-term incentive (LTI) contingent on the achievement of collective targets over consecutive performance periods of three (3) financial years, in accordance with the terms and conditions set out below.
The actually earned long-term incentive will be determined on the basis of the extent to which the following measurable and quantitative performance criteria in the long term (3 years) are achieved, in each case also reflecting the weighting factor:
| Performance criteria | Strategic objective | ||
|---|---|---|---|
| Criteria | Weight | ||
| Above average EPS evolution compared to other public REITs listed on Euronext Brussels |
30% | Creating value for shareholders | |
| Fin an cia l |
Net debt/EBITDA ratio in line with requirements for Fitch investment grade (BBB-) |
20% | Creating value for shareholders |
| Operating cost | 15% | Creating value for shareholders | |
| Totaal | 65% | ||
| fin No an n cia l |
ESG-targets | 35% | Future-proofing the real estate portfolio and the Company |
| Totaal | 35% |
The board of directors, on the recommendation of the nomination and remuneration committee, will set the performance criteria in the first three months of the relevant three-year performance period. The board will ensure that the performance criteria are different for the STI and the LTI.
The proposed long-term incentive 'on target' is set at EUR 200,000 for the CEO, EUR 150,000 for the CFO and COO and EUR 90,000 for the CLO and CBDO. These amounts will be applied identically for each three-year performance period covered by the scope of this remuneration policy and, in other words, will not be indexed or otherwise increased. For the CEO, CFO and COO, these amounts are identical to the amounts that were included in the 2022 remuneration policy, which were not indexed or increased. For the CLO and CBDO, who joined executive management in 2024, the amounts have been aligned with the amounts included in the 2022 remuneration policy so that they represent a relatively similar proportion of their fixed remuneration. The thresholds (threshold), targets and maximum performance levels are determined for each of the performance criteria individually by the board of directors in the first three months of the relevant threeyear performance period based on a number of internal and external benchmarks. The performance targets are ambitious but achievable, taking into account the specific strategic priorities and economic climate in a
Care Property Invest nv Horstebaan 3 2900 Schoten
Belfius BE27 0919 0962 6873 BTW BE 0456 378 070 RPR Antwerpen – Afdeling Antwerpen
given three-year performance period. For bonus purposes, the performance target usually requires a significant improvement on the previous period's result, and for financial measures, the targets are usually in line with the upper limit of the market consensus.
The extent to which the performance criteria were met for a given performance period will be calculated for each of the performance criteria as follows:
| Bonus (% target bonus) (pay-out zone) |
||
|---|---|---|
| Actual performance below the threshold value | 0% | |
| Actual performance between the threshold value and the target |
80% - 100% (pro rata) | |
| Actual performance on target | 100% | |
| Actual performance between target and the maximum performance level |
100% - 120% (pro rata) | |
| Actual performance above the maximum performance level |
120% (capped) |
The board of directors, on the advice of the nomination and remuneration committee, after approving the Company's annual results, determines the extent to which the financial and non-financial performance criteria were achieved for the previous three-year performance period and, on that basis, determines the amount of the long-term incentive eligible for payment for each member of executive management.
The long-term incentive will be paid in cash in the year following the three-year performance period and immediately after its determination by the board of directors. The net proceeds (after deduction of applicable withholding taxes) of the payment of the long-term incentive may be used by the beneficiary to purchase shares of the Company at a reduced price per share equal to 100/120th of the weighted average share price for a period of twenty (20) trading days prior to the day of purchase, provided that the shares are unavailable and non-transferable for a period of at least three (3) years following their purchase. Considering these conditions, the shares are immediately fully vested.
5.6. Minimum shareholding requirement
In accordance with recommendation 7.9 of the 2020 Code, members of executive management are required to hold a minimum number of shares at all times and for as long as they remain members of executive management. For each member of executive management, the minimum acquisition value in shares of the Company is set at 50% of the annual gross fixed remuneration applicable on 1 January 2025, with the actual price (excluding expenses) at which the shares were acquired by the member of the executive management to be taken into account for the assessment. Non-financially acquired shareholdings under share incentive plans do not count towards meeting the requirement.
If a new member joins the executive management, he/she will have a period of five (5) years to build up his/her shareholding of the Company in accordance with the thresholds set out above. As long as executive management members have not reached the minimum threshold of shares to be held, an obligation will apply to use at least 50% of the net long-term incentive (LTI) to acquire shares of the Company in accordance with the long-term incentive plan.
5.7. Pensions
The members of executive management are entitled to an individual pension scheme with contributions and the accompanying cover.
The plan covers the following risks:
- Replacement income in the event of occupational disability due to illness or an accident;
- Premium exemption in the event of illness or an accident;
- Pension capital (if the participant is alive on the termination date); and
- Capital on decease of the participant (death benefit).
5.8. Benefts in kind and other remuneration components
The remuneration of the members of executive management also includes:
- Hospitalisation insurance;
- Benefits in kind associated with the use of a company car, i.e. a fuel card/charging card, all-risks insurance, roadside assistance and road tax;
- Mobile phone; and
- Laptop.
5.9. Contribution to the Company's business strategy, long-term interests and sustainability
The structure of the remuneration of the members of executive management is aimed at promoting sustainable long-term value creation of the Company.
The level of the fixed remuneration ensures that the Company can rely on professional and experienced management at all times, including in more difficult times.
The payment of the short-term incentive depends on the realisation of performance criteria that reflect the Company's strategy:
- As an RREC, it is important for the Company to be able to offer its shareholders a stable (and growing) dividend. The choice of EPS and operating margin as performance criteria responds to this objective.
- The success of the Company as a business also depends on the achievement of its ESG objectives as set out in the sustainability roadmap. For that reason, the management's short-term bonus also depends on SMART targets derived from the sustainability roadmap.
The long-term success of the Company is further stimulated by the long-term incentive, which also rewards members of executive management in case of a positive evolution of EPS result and operating margin over a three-year period. In addition, the Company has also included ESG criteria as non-financial performance criteria. These criteria frame the fact that the Company aspires to a quality real estate portfolio at all times. Moreover, as also indicated in the Sustainable Finance Framework, the Company wishes to put enormous effort into ESG in all its aspects in the coming years.
5.10. Key conditions of the agreements
5.10.1. Claw-back
The short-term incentive plans and the long-term incentive plans provide for adequate claw-back mechanisms. The Company has the right to reclaim all or part of a variable remuneration from the beneficiary if it appears that payment has been made on the basis of incorrect information concerning the
achievement of the performance targets or about the circumstances on which the variable remuneration was dependent.
5.10.2. Good and bad leaver arrangements
The short-term and long-term incentive plans provide for good and bad leaver arrangements in the event of resignation or termination of the mandate of the members of executive management. Good leavers will be paid the vested incentives at the end of the performance period pro rata to the part of the performance period they were active in the Company. Bad leavers will lose the short-term and long-term incentives that have not yet vested.
Good leavers having the age of 65 will no longer be bound by the lock-up requirement under the share purchase plans.
6. Newly appointed directors and members of executive management
Newly appointed members of executive management will participate in short-term and long-term incentive plans that have the same structure as the plans set out above in this remuneration policy. The amount of the fixed remuneration, the long-term incentive and the short-term incentive of a newly appointed member of executive management will be determined by the board of directors at the time of his/her appointment.
The board of directors can consider and award buy-out and/or sign-on bonuses to newly appointed directors or members of executive management. To the extent possible, the board of directors intends to limit such buy-out and/or sign-on bonuses to the value of the short-term incentives and/or long-term incentives of the new joiner's previous employer that will be forfeited. Especially buy-out bonuses for forfeited long-term incentives shall not exceed the realistic value of such forfeited awards.
7. Deviations of the remuneration policy
The Company may temporarily derogate from the remuneration policy, provided that:
1° the derogation is justified by exceptional circumstances in which such derogation is necessary to serve the long-term interests and sustainability of the Company as a whole or to guarantee its viability;
2° the derogation is permitted by the board of directors on the recommendation of the nomination and remuneration committee, substantiating the reasons;
3° the derogation does not lead to the remuneration of the beneficiary being excessive compared to market practice.
A derogation may only relate to the provisions of this remuneration policy regarding
- the variable remuneration (KPI-setting, pay-out, with the exception of the ceilings);
- slight increases in pensions;
- good and bad leaver arrangements.
8. Review of the remuneration policy
The remuneration policy may be amended when deemed appropriate by the board of directors on the recommendation of the nomination and remuneration committee and, if it concerns material changes, subject to the submission of the revised policy for approval by the general meeting in the cases prescribed by article 7:89/1, §3 BCCA.
Building a Caring Future Together
When the policy is revised, the following information must be described and explained to the general meeting:
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- The main changes that have occurred, and
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- How the votes and positions of the shareholders on the remuneration policy and the remuneration reports have been taken into account since the most recent vote on the remuneration policy at the general meeting.