Intercos — Remuneration Information 2023

Apr 6, 2023

PURSUANT TO ARTICLE 123-TER OF THE CFA

Intercos S.p.A.

https://www.intercos-investor.com/ Approved by the Board of Directors on March 14, 2023

CONTENTS

INTRODUCTION	07
EXECUTIVE SUMMARY	09
INTERCOS BUSINESS STRATEGY	11
REMUNERATION POLICY	11
SUMMARY OF 2023 REMUNERATION POLICY	13
MAIN CHANGES/ADDITIONS TO THIS REPORT AND THE 2023 REMUNERATION POLICY	15
RESULTS OF VOTING ON THE REMUNERATION POLICY AND REPORT	15

SECTION I - REMUNERATION POLICY	16
1. GOVERNANCE OF THE REMUNERATION PROCESS	17
1.1 Boards and parties involved 1.2 Shareholders' Meeting 1.3 Board of Directors 1.4 Appointments and Remuneration Committee 1.5 Board of Statutory Auditors 1.6 Appointment of independent experts 1.7 Process for defining and approving the Remuneration Policy	17 18 19 20 21 21 21
1.8 Process for temporary waiver of the Remuneration Policy 2. PURPOSE, PRINCIPLES, CONTENT AND BENEFICIARIES OF THE REMUNERATION POLICY	23 24
2.1 Remuneration Policy objectives 2.2 Principles of the Remuneration Policy 2.3 Content and beneficiaries of the Remuneration Policy Remuneration of Directors not holding special offices 2.3.1 2.3.2 Chairperson of the Board of Directors - Pay mix - Fixed remuneration - Non-monetary benefits - Indemnity in the case of dismissal or termination of employment - Non-competition agreements	24 25 26 27 29 29 29 29 29 29
2.3.3 Chief Executive Officer and other Executive Directors - Pay mix	29 29
- Fixed remuneration	30

- Short-term variable incentive: STI	30
- Incentive curves	31
- Long-term variable incentive	32
- Good and bad leaver and clawback clauses	35
- Retention bonuses and other types of monetary incentives	35
- Non-monetary benefits	36
- Indemnity in the case of dismissal or termination of employment	36
- Non-competition agreements	36
2.3.4 Senior Executives	36
- Pay mix	37
- Fixed remuneration	37
- Short-term variable incentive: STI	37
- Long-term variable incentive	37
- Average pay mix	38
- Non-monetary benefits	38
- Special bonus	38
- Indemnity in the case of dismissal or termination of employment	38
- Non-competition agreements	38
2.3.5 Remuneration of the members of the Control Board	39

b.

SECTION II: COMPENSATION PAID	40
1. INTRODUCTION	41
2. PART ONE- REMUNERATION ITEMS	42
2.1 Proportion between fixed and variable compensation paid	42
2.2 Fixed remuneration	42
2.2.1 Directors not holding special offices and members of the internal Board committees	42
2.2.2 Chairperson of the Board of Directors	43
2.2.3 Chief Executive Officer and Executive Directors	43
2.2.4 SEs	43
2.3 Short-Term Variable Compensation	44
2.3.1 Chief Executive Officer and Executive Directors	44
2.3.2 SEs	45
2.4 Non-monetary benefits	45
2.5 Termination of office or employment	45
2.6 Exceptions to the Remuneration Policy	45
2.7 Variable component ex-post correction mechanisms	46
2.8 Annual change in remuneration	46
2.9 Vote cast by the Shareholders' Meeting in 2022	46
3. PART TWO - BREAKDOWN OF FEES
PAID DURING THE YEAR	47

GLOSSARY

IN ADDITION TO THE TERMS DEFINED WITHIN THIS REPORT, THE TERMS LISTED BELOW SHALL HAVE THE MEANINGS ASCRIBED TO THEM BELOW:

ARC

the Appointments and Remuneration Committee of Intercos.

BOARD OF DIRECTORS OR THE BOARD OR BOD

the Board of Directors of Intercos S.p.A.

BOARD OF STATUTORY AUDITORS

the Board of Statutory Auditors of Intercos S.p.A.

BUSINESS PLAN

the 2023-2027 Business Plan approved by the Board of Directors of Intercos on March 7, 2023.

CFA

Legislative Decree No. 58 of February 24, 1998 (Consolidated Finance Act) in force at the Reporting Date.

CG COMMITTEE/CORPORATE GOVERNANCE COMMITTEE

the Italian Committee for the Corporate Governance of listed companies, promoted by Borsa Italiana S.p.A., ABI, ANIA, Assogestioni, Assonime and Confindustria.

CG REPORT

the Corporate Governance and Ownership Structure Report that companies are required to prepare in accordance with Article 123-bis of the CFA.

CHIEF EXECUTIVE OFFICER/CEO

the Chief Executive Officer of Intercos S.p.A.

CIVIL CODE/CIV. COD./C.C.

the Italian Civil Code.

CODE/CG CODE

the Corporate Governance Code for listed companies approved in January 2020 by the Corporate Governance Committee.

COMPANY OR INTERCOS

Intercos S.p.A.

CONSOB ISSUERS' REGULATION OR ISSUERS' REGULATION

the Regulation issued by Consob Resolution No. 11971 of 1999 (as subsequently amended).

EARNINGS BEFORE INTEREST, TAX, DEPRECIATION AND AMORTIZATION OR EBITDA

this is an indicator of operating performance. It is calculated as net income for the year before taxes, net financial income (expense) and amortization, depreciation and impairment, as reported in the statutory or consolidated financial statements, as appropriate1 .

EARNINGS PER SHARE OR EPS

the "virtual unitary share" of net income available to ordinary shareholders, calculated by dividing the net income available, as per the approved consolidated financial statements, by the average number of shares in the year in question.

ESG

acronym for Environment, Social, Governance: it refers to three central factors in measuring the sustainability of a company. The factors under letter (E) refer to environmental impact, including parameters such as carbon dioxide emissions, efficiency in the use of natural resources, attention to climate change, population growth, biodiversity and food security, but also indirect factors such as the impact operators may have on the climate and the environment, or in investment and financing processes. Factors under (S) refer to a company's social impact, including respect for human rights, working conditions, attention to equality and inclusion in the treatment of people and employees, control of the supply chain, customer focus, and sustainable impact on communities. Factors under (G) refer to aspects of corporate governance, including the presence of Independent Directors and diversity policies (gender, ethnicity, etc.) on the composition of the Board of Directors and, in particular, issues relating to the internal system of processes, procedures and controls that the organization adopts for its governance, to comply with laws and regulations and to meet the needs of stakeholders.

EURONEXT - MILAN

the stock exchange organized and managed by Borsa Italiana S.p.A.

1 We note, to the extent necessary, that for the purposes of ascertaining the achievement of the operating performance indicators within the Group, the reference EBITDA is the consolidated EBITDA of the Intercos Group determined by applying the criteria set forth in the loan agreement entered into on December 17, 2019 by the Company with the pool of banks comprising "Banca IMI S.p.A.", "BNP Paribas - Italian Branch", "UniCredit S.p.A.", "Crédit Agricole Italia S.p.A.", "Crédit Agricole Corporate and Investment Bank, Milan Branch", "Banca Nazionale del Lavoro S.p.A." and "Intesa Sanpaolo S.p.A.", or by any subsequent Group loan agreement replacing the aforementioned agreement within the date of ascertainment.

EXECUTIVE DIRECTORS

pursuant to the CG Code, Chief Executive Officers of the Company or of a subsidiary with strategic importance, including the relative Chairperson, are those attributed individual powers of management or when they have a specific role in the strategies of the business; Executive Directors are also those that hold directive offices within the Company or within a subsidiary company with strategic importance, or in the parent company if the appointment also concerns Intercos.

GROUP EBITDA MARGIN

the EBITDA margin measures the ratio in percentage terms between the EBITDA economic indicator and turnover.

INTERCOS GROUP OR GROUP

collectively, Intercos S.p.A. and the companies directly or indirectly controlled by it pursuant to Article 93 of the CFA.

LONG-TERM INCENTIVE PLAN (LTI)

the long-term incentive plan that entitles the persons involved a bonus in relation to the achievement of multi-year targets defined at company level

MEETING OR SHAREHOLDERS' MEETING

the Shareholders' Meeting of Intercos S.p.A.

NET FINANCIAL POSITION OR NFP

this is an indicator used in financial statement analysis that represents the company's net debt to third parties in terms of financial payables net of cash and cash equivalents.

REPORT/REMUNERATION REPORT

the Remuneration Policy and Report that the Company is required to prepare and publish in accordance with Article 123-ter of the CFA and Article 84-quater of the Consob Issuers' Regulation.

REPORTING DATE

the date of approval of this Report by the Board of Directors of Intercos.

SHORT-TERM INCENTIVE PLAN (STI)

the short-term incentive that entitles the persons involved to receive an annual cash bonus, based on the objectives established and agreed with each person participating in the Plan.

TOTAL SHAREHOLDER RETURN OR TSR

the total return on an equity investment, calculated as the sum of the following components:

1. capital gain: ratio between the change in the share

price (difference between the price recorded at the end and at the beginning of the reporting period) and the price recorded at the beginning of the same period;

2. reinvested dividends: the ratio of dividends per share distributed during the reporting period to the share price at the beginning of the period. The dividends are considered reinvested in the stock.

TRADING COMMENCEMENT DATE

the date of November 2, 2021, the first day the shares of Intercos were traded on the Euronext - Milan exchange.

VALUE ADDED SALES

calculated as the difference between revenues for the year, as per the Issuer's consolidated financial statements, and the costs incurred for packaging, net of those relating to products in the Delivery System segment.

INTRO- DUCTION

This Report, approved by the Board of Directors of Intercos S.p.A. on March 14, 2023, on the proposal of the ARC, prepared in accordance with Article 123-ter of the CFA, is divided into the following sections:

• SECTION I illustrates in a clear and comprehensible manner the policy (the "Remuneration Policy" or the "Compensation Policy") adopted by Intercos with reference to the members of the Board of Directors and, without prejudice to the provisions of Article 2402 of the Civil Code, of the Controlling Body, as well as the other "Senior Executives" identified by the Board of Directors of Intercos (hereinafter the "SEs"), describing its general philosophy, the bodies involved and the procedures used for its adoption, review and implementation, including the measures aimed at avoiding or managing any conflicts of interest. The Remuneration Policy is valid for one year, until the Shareholders' Meeting called to approve the 2023 Annual Accounts; Section I of the Report, in compliance with the provisions of the CFA2 , is subject to the binding vote of the Ordinary Shareholders' Meeting called to approve the 2022 Annual Accounts;
• SECTION II illustrates the compensation paid in fiscal year 2022 by the Company and its subsidiaries or associated companies by name for members of the Board of Directors (executive and nonexecutive), Statutory Auditors and, in aggregate, for other SEs. Section II of the Report, in compliance with the provisions of the CFA, is submitted to the advisory vote of the Ordinary Shareholders' Meeting called to approve the 2022 Annual Accounts.

The Remuneration Policy described in Section I has been prepared in line with the recommendations on remuneration of the CG Code, to which Intercos adheres, and is consistent with the provisions of Consob3 .

The two sections of the 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. The introductory section also provides an at-a-glance summary of the main elements of the Remuneration Policy and the changes from the Remuneration Policy last submitted to the Shareholders' Meeting, and how that revision took into account the votes cast and views expressed by shareholders at that meeting or subsequently. Moreover, Section II contains: (i) information - according to the criteria set out in Annex 3A, Schedule 7-ter of the Issuers' Regulation - on the equity investments held in the Issuer and its subsidiaries by the members of the management and control boards, as well as by spouses who are not legally separated and minor children, pursuant to the provisions of Article 84-quater, paragraph 4 of the Issuers' Regulation; and (ii) information on the financial instruments assigned in implementation of the remuneration plans based on financial instruments, in compliance with the provisions of Article 84-bis, paragraph 5 of the Issuers' Regulation.

This Report is available to the public at the registered office of the Company in Milan (MI), Piazza Generale Armando Diaz no. 1, Italy, as well as on the Company's website www.intercos-investor.com in the Governance section.

2 Article 123-ter of the CFA, which stipulates that "at least twenty-one days before the date of the Shareholders' Meeting [...] listed companies shall make available to the public a remuneration policy and report, at their registered office, on their website and in accordance with the other procedures established by Consob in its regulations". The same Article 123-ter, paragraph 3-bis of the CFA states that "companies shall submit the remuneration policy [...] to the vote of the shareholders at least every three years or on the occasion of changes to the policy". Paragraph 3-ter states that "the resolution provided for in paragraph 3-bis is binding" (i.e. on Section I of this document), further adding that "if the Shareholders' Meeting does not approve the remuneration policy submitted for a vote pursuant to paragraph 3-bis, the company shall continue to pay remuneration in accordance with the most recent remuneration policy approved by the shareholders' meeting or, failing that, may continue to pay remuneration in accordance with current practices."

EXECUTIVE SUMMARY

EXECUTIVE SUMMARY

The Intercos Remuneration Policy is closely related to the Company's business strategy, as described in the following paragraph; the ESG component, and in particular the sustainability of the Group's business strategy, is one of the founding and guiding elements of Intercos' work, which targets the creation of long-term value for the organization (with particular reference to internal stakeholders, such as the Group's human capital) and for society (with particular reference to external stakeholders, such as shareholders, suppliers and third parties in general) by integrating sustainability variables into the assessment of all aspects of the organization's context and processes.

"WE LIVE OUR VALUES", "WE CARE FOR PEOPLE" AND "WE BELIEVE IN SUSTAINABLE BEAUTY" ARE THE THREE MAIN GUIDELINES (ALSO OUTLINED IN THE INTERCOS CONSOLIDATED NON-FINANCIAL STATEMENT PREPARED IN ACCORDANCE WITH LEGISLATIVE DECREE NO. 254/2016) THROUGH WHICH THIS ACTION IS EXPRESSED.

These aspects are dynamically incorporated into the Remuneration Policy also through the provision of sustainability KPIs within the long-term incentive system, as better described below.

INTERCOS BUSINESS STRATEGY

The Intercos Business Strategy, as envisaged in the Business Plan, is based on the following fundamental pillars, to which the Company's Remuneration Policy is linked as a fundamental tool for the pursuit of medium-long term strategic objectives:

REMUNERATION POLICY

Intercos' Remuneration Policy, defined in accordance with the corporate governance model adopted by the Company and in line with the recommendations of the CG Code, is summarized below:

Performance Enhancement	Ensure that remuneration systems contribute: a) to the achievement of the Company's strategic objecti ves, the pursuit of the Company's medium- to long-term interests and the sustainable success of the Company; and b) considered risk management, including by con stantly monitoring the effectiveness and reviewing remuneration and in centive systems.	Short-Term Incentive Long-Term Incentive
Attractiveness and Motivation	Ensure a transparent compensa tion and incentive system designed to attract, motivate and retain key people for the organization with the skills and professionalism critical to the sustainable success of the Company.	Fixed remuneration Non-monetary benefits
Sustainability	Contribute to the pursuit of the Company's strategy, in a manner that is functional to the pursuit and achievement of the objective of creating value in the medium-long term for the benefit of shareholders, taking into account the interests of other stakeholders relevant to the Group.	Long-Term Incentive

INTERCOS APPLIES THE PRINCIPLES OF THE REMUNERATION POLICY ACROSS THE BOARD TO ALL THE RESOURCES THAT CONTRIBUTE TO THE GROUP'S WORK, IN AN INCLUSIVE MANNER AT EACH LEVEL OF THE ORGANIZATION (WE CARE FOR PEOPLE) AND WITH THE AIM OF CREATING A CORPORATE CULTURE TARGETED AT CREATING LONG-TERM SUSTAINABLE VALUE (WE BELIEVE IN SUSTAINABLE BEAUTY). AT THE SAME TIME IT MAINTAINS A SPECIAL FOCUS ON KEY PEOPLE WHO CAN CONTRIBUTE TO THE ACHIEVEMENT OF THE COMPANY'S OBJECTIVES, IN LINE WITH THE GROUP'S VALUES (WE LIVE OUR VALUES).

SUMMARY OF 2023 REMUNERATION POLICY

enhancement

COMPENSATION COMPONENT	PURPOSE	CONDITIONS FOR IMPLEMENTATION	AMOUNTS/BENEFITS ATTRIBUTED
Fixed remuneration	Attract, motivate and retain resources with key skills and expertise	Verification of salary positioning relative to market salary levels based on assigned role and responsibilities.	Executive Chairperson: Euro 1,640,000
			CEO: Euro 800,000
			Executive Director Arabella Ludovica Ferrari: Euro 315,000
			Executive Director Gianandrea Ferrari: Euro 225.000 (see details below)
			SEs: commensurate with assigned role and experience
Short-term variable incentive	Promote achievement of annual goals and performance	CEO: 2023 Objectives: Group EBITDA (50%) / Group NFP (30%) / Value Added Sales (20%)	CEO: target opportunity 70% base salary/max payout opportunity 105% base salary

Executive Directors:

2023 Targets Ludovica Arabella Ferrari: Group EBITDA (40%) / Group NFP (25%) / Value Added Sales (15%) / Function / Legal Entity / Country /Region / Individual Targets (20%).

2023 Targets Gianandrea Ferrari: Group EBITDA (25%) / Group NFP (15%) / Value Added Sales (10%) / Function / Legal Entity / Country / Region / Individual Targets (50%).

SEs:

2023 Objectives: Group EBITDA (40%) / Group NFP (25%) / Value Added Sales (15%) / Function / Legal Entity / Country /Region / Individual Targets (20%).

Executive Directors: target opportunity 40% of base salary for Ludovica Arabella Ferrari and 30% of base salary for Gianandrea Ferrari / max payout opportunity 60% of base salary for Ludovica Arabella Ferrari and 45% of base salary for Gianandrea Ferrari

SEs: target opportunity 30%- 40% of base salary/max payout opportunity 45%-60% of base salary

or employment relationship

resources

COMPENSATION COMPONENT	PURPOSE	CONDITIONS FOR IMPLEMENTATION	AMOUNTS/BENEFITS ATTRIBUTED
			CEO: target opportunity 63% base
Long-term variable incentive	Promote sustainable value creation in the medium/long term	"2023-2025 Performance Shares Plan" Targets: 2025 Relative TSR (45%);	salary/max payout opportunity 107% base salary
		Cumulative EPS (35%); Scope 1 and Scope 2 CO2 Emissions Reduction (20%).	Executive Directors: Ludovica Arabella Ferrari: target opportunity 48% base salary/max payout opportunity 81% base
		Plan reserved for beneficiaries (employees and Directors of the Group) identified by the Board of Directors or to be identified by name by the Board of Directors upon the proposal of the Chief Executive Officer, from among the managers of the	salary Gianandrea Ferrari: target opportunity 56% base salary/max payout opportunity 95% base salary
		Company or its subsidiaries (including Executive Directors and SEs) who hold positions with the greatest impact on the Company's results or with strategic importance for the achievement of the	SEs: target opportunity 40-63% of base salary / max payout opportunity 68-107% of base salary
		Group's long-term objectives.	The above opportunities are valued based on the market price of the stock in the three months prior to 2/8/23
Non-monetary benefits	Integrating the compensation package	Executive Chairperson, CEO and Executive Directors, SEs Benefits foreseen by the relevant	Executive Chairperson, CEO and Executive Directors: Includes, but is not limited to,
		national collective bargaining agreements (CCNL) and/or Remuneration Policy.	the use of cell phones and lap top computers, company cars, supplemental health and accident, disability and death insurance coverage.
			SEs: The compensation offer is supplemented with the non monetary benefits provided for by the relevant national collective bargaining agreements (CCNL) and company practices (i.e., professional and extra-professional accident policy, disability and death policy, supplementary pension, supplementary medical insurance
			and annual check-up, allocation of a car for mixed use and fuel card, company devices).
Termination of office and/	Attract and/or retain management	Executive Chairperson: N/A	Executive Chairperson: N/A

Chief Executive Officer and

Executive Directors: N/A. A noncompetition agreement is in place with the Chief Executive Officer, valid for twelve months from the date of leaving office.

Non-competition agreement

CEO: 11% of the relevant fixed remuneration on an annual basis, the amount of which is paid on a continuing basis.

COMPENSATION

COMPONENT PURPOSE CONDITIONS FOR IMPLEMENTATION AMOUNTS/BENEFITS ATTRIBUTED

SEs: The Company may recognize additional compensation with respect to what is due in accordance with the provisions of the law in force and the applicable national and company collective bargaining agreements or severance indemnities. The Company may also enter into non-competition agreements with SEs that are valid for twelve months from the date of termination of employment.

SEs: With reference to indemnities and severance pay, a maximum of 24 months' pay, in any case in compliance with the applicable national collective bargaining agreements (CCNL). With reference to the non-competition agreement, a maximum of 75% of the gross annual remuneration paid after termination of the employment relationship.

MAIN CHANGES/ADDITIONS TO THIS REPORT AND THE 2023 REMUNERATION POLICY

Although the 2023 Remuneration Policy was defined with a view to continuity and consolidation with the previous year's Policy, under current mandatory regulatory requirements a number of changes were made with a view to increasing disclosure to all stakeholders.

Specifically, with the goal of progressively aligning with market best practice by favoring the variable component of management compensation over the fixed component in a pay-for-performance perspective, the Company has made a number of changes to its existing incentive systems:

Short-term variable incentive:

• the maximum pay opportunity of the CEO and other Executive Directors is set at 150% of the target bonus;
• with reference to the Group targets, the Company has stipulated that the KPIs relating to EBITDA, NFP and Value Added Sales are to be common to all beneficiaries of the Short-Term Incentive, based on the rationale of sharing the company's strategy and the associated results;
• in line with market best practice, the gate mechanism represented by Group EBITDA has been removed, as this performance KPI is already included in the current system in the beneficiaries' individual scorecards (by way of example, as described in more detail below, please note that the weighting of the EBITDA in the CEO's targets scorecard is 50%).

Long-term variable incentive:

Regarding the long-term incentive, the Company plans to introduce an equity-based long-term incentive plan, structured over three (3) three-year rolling cycles. In 2023 the new LTI plan is to be adopted, based on performance shares for the 2023-2025 period submitted for approval to the Shareholders' Meeting called to approve the financial statements as at December 31, 2022, with the following changes compared to the previous LTI plan:

• Introduction of Relative TSR: Intercos's TSR will be compared to a group of companies/indices selected on the basis of industry proximity and national and international competitive environment criteria, with a weighting of 45%. The minimum payout level is set at the achievement of an Intercos ranking no lower than the median;
• Introduction of a new sustainability target of reducing CO2 emissions, with a weighting of 20% and in line with the latest and best market practice.

RESULTS OF VOTING ON THE REMUNERATION POLICY AND REPORT

The 2022 Remuneration Policy and Report was widely supported by shareholders, with 98% of the Shares represented at the Shareholders' Meeting voting in favor for Section I, and 99.96% of the Shares represented at the Shareholders' Meeting voting in favor for Section II, thus expressing the support of an absolute majority of Shareholders. The graph below illustrates the outcome of the vote:

This year, once again, Intercos confirms its commitment to continuously improving the Remuneration Policy, raising the standards of disclosure with a focus on aspects linked to the relationship between remuneration and sustainable performance.

A

SECTION I: REMUNE- RATION POLICY

GOVERNANCE OF THE REMUNERATION PROCESS 1.

1.1 BOARDS AND PARTIES INVOLVED

The preparation and approval of the Remuneration Policy involves the ARC, the Board of Directors, the Board of Statutory Auditors and the Shareholders' Meeting.

The Remuneration Policy for the members of the Board of Directors of Intercos is defined in accordance with the regulatory and statutory provisions, according to which:

• the Shareholders' Meeting determines an overall amount for the remuneration of all Directors, including Executive Directors;
• within the limits of the remuneration established by the Shareholders' Meeting, the determination of the remuneration due to each Director is carried out by the Board of Directors, taking into account the roles and powers assigned. The Board of Directors determines the remuneration of the Executive Directors in compliance with the By-Laws and for their participation in the Board Committees, having heard the opinion of the Board of Statutory Auditors.

In particular, the ARC, exercising its powers also as provided for in the CG Code, assists the BoD in the elaboration of the Remuneration Policy by formulating proposals regarding the structure and relative contents and, together with the BoD, monitors its correct implementation, as well as the need to make any revisions.

The BoD is, therefore, the board responsible for approving the Remuneration Policy, based on the proposal made by the ARC.

SUBSEQUENTLY, PURSUANT TO ARTICLE 123-TER, PARAGRAPHS 3-BIS AND 3-TER, OF THE CFA, DURING THE APPROVAL OF THE ANNUAL ACCOUNTS, THE SHAREHOLDERS' MEETING IS CALLED UPON TO RESOLVE IN FAVOR OR AGAINST THE REMUNERATION POLICY, AS DETAILED BELOW. THE TABLE BELOW SUMMARIZES THE PROPOSING BODIES, DECISION-MAKING BODIES AND SUPPORTING STRUCTURES FOR EACH PERSON COVERED BY THE REMUNERATION POLICY.

PARTY REMUNERATED	PROPOSAL BODY	DECISION-MAKING BODY	SUPPORT STRUCTURE	INDEPENDENT EXPERTS
Chairperson	Board of Directors assisted by the Appointments and Remuneration Committee	• Shareholders' Meeting () • Board of Directors (*)
Chief Executive Officer	Board of Directors assisted by the Appointments and Remuneration Committee	• Shareholders' Meeting () • Board of Directors (*)
Directors	Board of Directors assisted by the Appointments and Remuneration Committee	• Shareholders' Meeting () • Board of Directors (*)	Human Resources, Organization & SA and Public Affairs, Legal & Business Development	Independent consultant
Board of Statutory Auditors	Shareholders' Meeting	Shareholders' Meeting
SEs	Board of Directors assisted by the Appointments and Remuneration Committee	Board of Directors

(*) The Shareholders' Meeting determines the total amount of the remuneration for all Directors, including Senior Directors.

(**) Within the limits of the total remuneration set at the Shareholders' Meeting, the determination of the remuneration due to each Director is approved by the Board of Directors, having consulted the Board of Statutory Auditors, taking into account the offices and powers assigned.

1.2 SHAREHOLDERS' MEETING

The duties of the Shareholders' Meeting, with respect to the matters of interest within the scope of this Report, are:

• determine the total amount for the remuneration of all the Directors, including Executive Directors and the remuneration of the Statutory Auditors; in particular, with regard to Directors, the By-Laws provide that the Shareholders' Meeting may not only determine a total amount for the remuneration of all Directors, including Executive Directors, but also grant Directors the right to receive a severance indemnity;
• express its binding vote on the Remuneration Policy adopted by the Company, pursuant to Article 123-ter, paragraphs 3-bis and 3-ter of the CFA;
• express its non-binding vote on the second section of the Company's Remuneration Policy and Report, pursuant to Article 123-ter, paragraph 6 of the CFA;
• resolve on any remuneration plans based on financial instruments for Directors, employees (including Senior Executives) and collaborators, pursuant to Article 114-bis of the CFA.

1.3 BOARD OF DIRECTORS

The Board of Directors of Intercos, in office as of the Reporting Date, consists of 11 members:

NAME	OFFICE
DARIO GIANANDREA FERRARI	Executive Chairperson
RENATO SEMERARI	Chief Executive Officer
LUDOVICA ARABELLA FERRARI	Executive Director
GIANANDREA FERRARI	Executive Director*
NIKHIL KUMAR THUKRAL	Non-Executive Director
MICHELE SCANNAVINI	Non-Executive Director
NIKHIL SRINIVASAN	Non-Executive Director
CIRO PIERO CORNELLI	Non-Executive Director
GINEVRA OTT	Non-Executive Director
PATRIZIA DE MARCHI	Non-Executive Director
MAGGIE FANARI	Non-Executive Director

(*) Considered an Executive Director in accordance with the CG Code, since, as per the Board of Directors' motion of July 13, 2022, he holds the position of Chairperson of the Board of Directors and Chief Executive Officer of Intercos Europe S.p.A., a subsidiary of Intercos with strategic importance.

Pursuant to applicable law and the By-Laws, the Board of Directors has the following responsibilities under the Remuneration Policy:

• to determine the remuneration of Directors, including Senior Executives, in compliance with the By-Laws and within the limits of the total remuneration for all Directors established by the Shareholders' Meeting, having consulted the Board of Statutory Auditors;
• setting targets and approving business results for the incentive plans linked to the determination of variable remuneration for Executive Directors and SEs;
• approve general criteria for SE compensation;
• approve the Remuneration Report, to be submitted to the vote of the Shareholders' Meeting, binding with regard Section I and non-binding with regard to the Section II.

It should be noted that all parties abstain from participating in board discussions and motions relating to their own remuneration.

For further details on the role of the Board of Directors, please refer to the By-Laws available on the Company's website www.intercos-investor.com in the Governance section and to the CG Report approved by the Board of Directors on March 14, 2023, published at the same time as this Report and available on the Company's website in the Governance section.

1.4 APPOINTMENTS AND REMUNERATION COMMITTEE

The duties, powers and operating rules of the ARC are governed by the specific regulation - approved by the Board of Directors on July 20, 2021 and subsequently confirmed on November 11, 2021 (the "ARC Regulation") - in line with the provisions contained in the CG Code, to which the Company adheres.

In accordance with the provisions of the CG Code, the ARC is composed only of Non-Executive Directors, the majority of whom are independent, and is chaired by an Independent Director:

NAME	COMMITTEE ROLE	OFFICE	COMMITTEE ACTIVITIES
Patrizia De Marchi	Chairperson	Independent Non Executive Director	The ARC met: • in 2022, on March 11 and 21, July 13, October 19 and December 16; • in 2023, on January 19, February 2 and
Michele Scannavini	Member	Independent Non Executive Director
Ciro Piero Cornelli	Member	Non-Executive Director	21, and March 7.

Pursuant to the provisions of Article 2 of the ARC Regulations and the recommendations of the CG Code (see Recommendation 26), the ARC is composed of 3 Non-Executive Directors, the majority of whom meet the independence requirements set out in the CG Code, and is chaired by an Independent Director. At least one member of the Committee has appropriate knowledge and experience in finance or remuneration policy⁴ .

The ARC has the right to access the information and the corporate functions necessary for the performance of the tasks assigned, to avail itself of financial resources and external consultants within the limits established by the Board of Directors (annual budget of Euro 15,000.00). It carries out its activities making use of the information provided by the Board of Directors and the support of the Human Resources, Organization & SA and Public Affairs, Legal & Business Development departments.

The principal functions of the ARC regarding remuneration, as defined in the Regulations, are as follows:

• a. assist the Board of Directors in developing remuneration policy;
• b. monitor the concrete application of the policy, verifying, in particular, the effective achievement of the performance targets;
• c. present proposals or express opinions to the Board of Directors on the remuneration of the Executive Directors and Senior Directors in addition to establishing the performance targets related to the variable component of this remuneration, and
• d. periodically assess the adequacy and overall consistency of the policy adopted for the remuneration of Directors and Senior Management.

No Director attended or participates in the Committee meetings at which proposals were made to the Board of Directors regarding his or her own compensation and decisions regarding the compensation of Committee members were made with the abstention of those involved.

For further information on the composition and functioning of the Appointments and Remuneration Committee, reference should be made to the information contained in the section "Internal Committees of the Board of Directors (pursuant to Article 123-bis, paragraph 2, letter d) of the CFA)" and in the "Self-evaluation and succession of Directors. Remuneration of the Directors. Appointments and Remuneration Committee" of the CG Report, published at the same time as this Report and available for consultation on the Company's website www.intercosinvestor.com in the Governance section.

1.5 BOARD OF STATUTORY AUDITORS

The Chairperson of the Board of Statutory Auditors or another Statutory Auditor designated by them are involved in the ARC's work; the other Statutory Auditors may also be involved.

Moreover, with regard to remuneration, the Board of Statutory Auditors expresses its opinion on the proposals for the remuneration of Executive Directors, pursuant to Article 2389, paragraph 3 of the Civil Code.

1.6 APPOINTMENT OF INDEPENDENT EXPERTS

For 2022 and for the current financial year, Intercos has continued to use expert consultants in a support function for the evaluation of positions and the definition of remuneration policies (Mercer Italia).

1.7 PROCESS FOR DEFINING AND APPROVING THE REMUNERATION POLICY

The Remuneration Policy is submitted to the Board of Directors for approval by the ARC. In drafting the policy, the ARC involves the Human Resources, Organization & SA and Public Affairs, Legal & Business Development Departments, also with the aim of gathering market data in terms of practices, policies and benchmarking, ensuring regulatory compliance, and in order to better elaborate the policy and, where necessary, also independent experts in the field.

The Board of Directors, on the proposal of the ARC, defines and adopts the Remuneration Policy in its form and internal regulatory sources and, specifically, the related content as summarized in the paragraphs relating to the Remuneration Policy for members of the Board of Directors and the SEs and the incentive plans. After examining and approving the Remuneration Policy, the Board of Directors submits this to the binding vote of the Shareholders' Meeting, making it available at least 21 days before the date of the Shareholders' Meeting through the publication of the Remuneration Policy and Report.

The full text of the Remuneration Policy and Report was reviewed in advance by the ARC on March 7, 2023, and then approved by the Board of Directors on March 14, 2023.

Remuneration Committee proposes the Policy

Any intervention by independent experts

The Board approves and adopts the Policy

The Shareholders' Meeting casts a binding vote on Section I and a non-binding vote on Section II of the Report

If the Shareholders' Meeting does not approve the Remuneration Policy submitted for a vote pursuant to Article 123, paragraph 3-bis of the CFA, Intercos will continue to pay remuneration in accordance with the Policy last submitted for a vote at the Shareholders' Meeting during the most recent year, 2022. In this case, Intercos shall submit a new Remuneration Policy to a vote of the shareholders, at the latest at the next Shareholders' Meeting provided for in Article 2364, paragraph 2, of the Civil Code.

Finally, it should be noted that the "Related Party Transactions Policy" - preliminarily adopted on July 20, 2021 and subsequently approved in its final version by the Board of the Directors on December 16, 2021, with the favorable opinion of the Related Parties Committee - (the "RPT Policy") excludes from the application of the policy:

• a) motions passed by the Shareholders' Meeting pursuant to Article 2389, paragraph 1 of the Civil Code, concerning the remuneration of the members of the Board of Directors and the Executive Committee (if established);
• b) motions concerning the remuneration of Executive Directors, within the overall amount previously determined by the Shareholders' Meeting pursuant to Article 2389, paragraph 3, of the Civil Code;
• c) motions passed by the Shareholders' Meeting as per Article 2402 of the Civil Code, concerning remuneration of the members of the Board of Statutory Auditors.

The RPT Policy does not apply, moreover, to motions on remuneration other than those referred to in letters a) and b) above, as well as to other Senior Executives, provided that:

• 1. Intercos has adopted a remuneration policy, which is subject to a binding vote of the Shareholders' Meeting;
• 2. in the drawing up of the remuneration policy a committee exclusively made up of Non-Executive Directors, the majority of whom independent, was involved; and
• 3. the remuneration assigned to each Director or Senior Executive is consistent with the policy adopted and quantified on the basis of criteria that do not imply discretionary assessments.

1.8 PROCESS FOR TEMPORARY WAIVER OF THE REMUNERATION POLICY

The Company has a process in place for temporary waiver of the Remuneration Policy if exceptional circumstances arise where waiver of the Policy is necessary in the furtherance of the long-term interests and sustainability of the Company as a whole, or to ensure the Company's ability to compete in the marketplace.

"Exceptional Circumstances" include, but are not limited to:

• 1. the occurrence, at national or international level, of extraordinary and unforeseeable events concerning the Company and/or the sectors and/or markets in which it operates, which significantly affect the Company's results, including the occurrence of significant negative effects not only of an economic or financial nature;
• 2. the intervention of substantial changes in the organization of the business activity, both of an objective nature (such as corporate transactions, mergers, disposals, etc.), and of a subjective nature, such as changes in the top management and the possible identification of persons (other than Directors and Statutory Auditors) qualifying as Senior Executives for the purposes of this Remuneration Policy;
• 3. significant changes in the perimeter of the company's activity during the period of validity of the Remuneration Policy, such as the sale of a company/business unit on whose activity the performance targets of the Remuneration Policy were based, or the acquisition of a significant business not contemplated for the purposes of the preparation of the Remuneration Policy.

The ARC, supported by the Human Resources, Organization & SA Department, is the board entrusted with the task of verifying the presence of such exceptional situations and formulating proposals for temporary exceptions to the Remuneration Policy to the Board of Directors, which has been identified as the board entrusted with the approval of such temporary exceptions.

Without prejudice to the above, the exception to the Remuneration Policy may concern: (i) the redefinition of the performance targets to which the variable remuneration is linked and of the periodicity with which they are set; (ii) the review of the criteria used to assess the targets; (iii) the change in the ratio between fixed and variable components of remuneration; (iv) the allocation of one-off cash bonuses; (v) the allocation of special indemnities, in order to take into account the aforementioned exceptional circumstances and only if instrumental to the pursuit of the aforementioned interests.

With regard to these exceptions, the opinion of the Related Party Transactions Committee must be obtained, following the relevant procedure set out by the Company.

ANY EXCEPTIONS APPROVED, WHICH MAY RELATE TO THE AFOREMENTIONED ELEMENTS OF THE REMUNERATION POLICY, WILL BE DISCLOSED THROUGH THE SUBSEQUENT REMUNERATION POLICY AND REPORT, ACCOMPANIED BY THE REASONS THAT PROMPTED THE COMPANY TO MAKE SUCH AN EXCEPTION.

PURPOSE, PRINCIPLES, CONTENT AND BENEFICIARIES OF THE REMUNERATION POLICY 2.

2.1 REMUNERATION POLICY OBJECTIVES

The Remuneration Policy provides that the amount of remuneration and the balance between the fixed and variable components of the remuneration of Directors and SEs are aimed at aligning the interests of the beneficiaries with the pursuit of the priority objective of creating value for shareholders over the medium/long term.

In this regard, these remuneration elements are defined consistently with the provisions of the Remuneration Policy, also taking into account the category, organizational level, responsibilities and professional skills of the beneficiaries and also taking into account the recommendations of the CG Code and the interests of other stakeholders relevant to the Group (the "Sustainable Success").

In particular, the Remuneration Policy is closely related to Sustainable Success and is inspired by the three main guidelines "We live our values", "We care for people" and "We believe in sustainable beauty", described in the introductory section, through which the work of the Company is expressed, and is designed to:

• (i) contribute to the creation of value, aligning the interests of management with the Company's strategies, by linking the Remuneration Policy with the Company's business results, also by sharing with the professionals within the Company, the increase in value of the Company and of the Group;
• (ii) guarantee the correct preparation, implementation and possible revision, as well as the effective monitoring, of the remuneration and incentive systems, ensuring that the remuneration systems referred - in particular - to the Executive Directors and SEs contribute (a) to the pursuit and achievement of the corporate objectives, of the medium/long term corporate interests and of the Sustainable Success objective and (b) to prudent risk management, through:
• 1. promote actions and behaviors that are in line with the values and culture of the Company and the Group, in accordance with the principles of plurality, equal opportunities, enhancement of people's knowledge and professionalism, fairness, respect for diversity and integrity;
• 1. promote actions and behaviors that are targeted at creating and ensuring sustainable working conditions and standards;

(iii) ensure a transparent remuneration and incentive system designed to attract, motivate and retaining key people for the Group with the specific skills and expertise critical to the achievement of the Sustainable Success objective, through:

• 1. recognition of the roles and responsibilities assigned, the results achieved and the quality of the professional contribution of individuals;
• 1. guaranteeing the principles of proportionality and internal equity and the link between company strategy and remuneration instruments, as well as the adequacy of remuneration and compensation with respect to the role covered, taking into account the complexity of the functions assigned and the relative responsibilities, as well as assessing the skills and abilities demonstrated, without prejudice to compliance with the legal provisions applicable to Intercos and the provisions of the national and company collective agreements in force;
• 1. support for competitiveness, in terms of balance and consistency of remuneration levels with respect to the market for similar positions and roles of similar level of responsibility and complexity, all as also resulting from appropriate benchmark analyses; and
• 1. the drive to retain key Group resources;
• (iv) ensure that the remuneration systems enhance performance by contributing to: a) the achievement of the Company's strategic objectives, the pursuit of medium/long-term corporate interests and Sustainable Success; and b) the prudent management of risk, also by constantly monitoring the effectiveness and reviewing the remuneration and incentive systems, by means of:
• 1. the definition of remuneration and incentive systems connected with the achievement of (a) economic/financial, (b) non-financial (including environmental and/or social sustainability and/or governance (so-called "ESG") objectives and (c) the development of operational and individual activities and responsibilities, defined with a view to the pursuit of results in the medium/long term, in line with the guidelines of the Group's strategic and/or business plans as well as with the responsibilities assigned;
• 1. the guarantee that the variable components of remuneration (short and/or medium-long term) are not based on results that have been altered or shown to be manifestly incorrect.

2.2 PRINCIPLES OF THE REMUNERATION POLICY

The general principles underlying the Remuneration Policy are as follows:

• (i) establish the procedures for determining the remuneration of Directors and, in particular, Executive Directors and those holding particular offices - of other SEs, in compliance with applicable regulations and in accordance with national and international best practices, as also reflected in the criteria, principles and recommendations of the self-regulation applicable to Intercos;
• (ii) identify, in particular, the parties and/or boards involved in the preparation, approval, implementation, monitoring and review of the Remuneration Policy and, more generally, of the remuneration procedures, which - according to their respective duties - (a) propose, deliberate and/or determine the remuneration of the Directors, and of the other SEs, (b) express opinions on the subject, or (c) are called upon to verify and monitor the correct implementation of what has been deliberated and determined by the competent boards;
• (iii) to guarantee adequate transparency in terms of remuneration for both current and potential investors, by fully formalizing (a) the related decision-making processes and (b) the criteria underlying the Remuneration Policy; and
• (iv) to make the various boards and individuals responsible for determining the remuneration of Directors and other SEs and, within the limits set by Article 2402 of the Civil Code, of the members of the Board of Statutory Auditors.

The Remuneration Policy shall be in effect for one year from the date of its approval by the shareholders.

Finally, we note that the Company periodically assesses staff remuneration levels by comparing them with the market, including with the help of independent remuneration experts, through specific benchmarking activities. For greater overall consistency, the Committee used the firm Mercer to conduct the compensation benchmarking activities for the Executive Chairperson, Chief Executive Officer, Executive Directors, and the SEs.

Below are the Peer Groups identified for each role:

ROLE	CRITERIA	PEER GROUP
Chief Executive Officer	1. Italian companies comparable with Intercos by size (capitalization, revenue, number of employees, EBITDA Margin), business operating model, and level of internationalization 2. International companies that are similar in terms of business and size.	1. Sanlorenzo, Technogym, Biesse, Datalogic, Safilo Group, Piaggio, Carel Industries, Brembo, De'Longhi, Interpump 2. E.l.f beauty, Interparfums, Nu Skin Enterprises
Executive Chairperson	1. Italian companies belonging to the Peer Group used for the Chief Executive Officer that have an Executive Chairperson 2. Italian-domiciled companies with a high level of comparability in terms of governance.	1. Brembo and Tod's 2. Ariston, Brunello Cucinelli, Cir, De'Longhi Group, Iveco Group, Maire Tecnimont, Prada
Executive Directors & SEs	Mercer Executive Remuneration Guide Western Europe Survey, which only includes information on the executive population of companies operating in major European countries.

2.3 CONTENT AND BENEFICIARIES OF THE REMUNERATION POLICY

The Remuneration Policy is based (i) on a fixed component and (ii) on a variable incentive component, linked to the achievement of predetermined performance targets of a financial and non-financial nature (including ESG targets) that can be objectively measured.

The variable component may consist of cash remuneration (bonuses or other monetary incentives) and/ or the assignment of financial instruments and/or a share in the profits for the year.

The balance between the fixed and variable components of remuneration must be appropriate and consistent with (i) the Sustainable Success objective, (ii) the strategic objectives and (iii) the Group's risk management policy, and is also determined in light of the characteristics of the Company's business and sector.

The fixed component of remuneration rewards skill levels and experience and remunerates Directors and SEs in accordance with their role and associated responsibilities. Moreover, the fixed component - in compliance with the applicable legal regulations and in line with the criteria, principles and recommendations of the self-governance code - is determined so as to adequately remunerate the activities carried out, also in the event that the variable component of the remuneration is not paid due to the failure to achieve the related objectives.

The aforementioned variable remuneration, in turn, consists of (i) a short-term variable component (Short Term Incentive or STI), linked to the achievement of pre-established short-term performance targets (mainly of a financial nature) (ii) to which a medium/long term variable remuneration component (Long Term Incentive or LTI) may be added aimed at directing the actions of the beneficiaries towards the achievement of pre-established medium/long term targets (of a financial and non-financial nature), enabling them to benefit from the creation of value for the Group and to retain the key resources of Intercos (retention).

Specifically, the STI variable component is linked to pre-established corporate and individual targets, mainly of a financial nature (targets of a non-financial nature are assigned exclusively to the SEs and to the Executive Directors other than the Chief Executive Officer). Targets are objectively measurable over a 12 (twelve) month time horizon.

The LTI variable component is linked to pre-established corporate targets of a financial and non-financial nature, different from those covered by the STI component and objectively measurable over a time horizon of 36 (thirty-six) months.

The Remuneration Policy establishes that the remuneration of Directors who do not hold special offices (including Independent Directors) shall be fixed and adequate in relation to the competence, professionalism and commitment required by the tasks assigned to them within the Board of Directors and any internal Board committees.

Finally, Intercos guarantees all its employees the same work opportunities and fair treatment in terms of regulations and remuneration. Intercos is committed to providing an inclusive working environment, free from discrimination of any kind, in which different personal and cultural characteristics and orientations are considered an asset. To this end, the Company not only undertakes to respect and apply the regulatory framework of the countries in which it operates, but also develops company policies aimed at guaranteeing equal opportunities for all the different types of workers, with the intention of discouraging the emergence of possible prejudice, harassment and discrimination of any kind (linked, for example, to race, nationality, ethnicity, culture, religion, sexual orientation, age and disability), in full respect of human rights. This context ensures that the key elements of the Remuneration Policy - and more generally of the management of its own people - are the principle of internal equity and the enhancement of merit and of distinctive and critical professional skills. In fact, the Remuneration Policy is defined and implemented in full consistency with the process of strategic planning of human resources and the results of the assessments of the skills, potential and performance of individuals, while at the same time ensuring that it is aligned with the specific needs of the markets and legal frameworks of the labor markets in which the Group operates.

2.3.1 Remuneration of Directors not holding special offices

	OFFICE	GROSS ANNUAL EMOLUMENT
1.	Director not holding special offices and not part of the Committees	Euro 25,000.00
2.	Director member of Committees	Euro 10,000.00 (in addition to the remuneration as Director specified in point 1)
3.	Director Chairperson of Committees	Euro 15,000.00 (in addition to the remuneration as Director specified in point 1 and, if applicable, to the remuneration as member of other Committees)
4.	Director & Lead Independent Director	Euro 20,000.00 (in addition to the remuneration as Director specified in point 1. to the remuneration deriving from participation in the Committees, as member or Chairperson)

On July 20, 2021, the Company's Ordinary Shareholders' Meeting resolved to set the total annual gross emolument for the Board of Directors at Euro 3,005,000.00, delegating the Board of Directors to determine the individual remuneration, without taking into account the variable remuneration deriving from any incentive plans approved by the Company and without prejudice to the power of the Board of Directors to attribute to the Directors vested with special offices any additional remuneration and bonuses pursuant to Article 2389, paragraph 3, of the Civil Code, having heard the opinion of the Board of Statutory Auditors.

Also on July 20, 2021, the Board of Directors of the Company, taking into account the total annual gross emolument approved by the Shareholders' Meeting as specified above, determined the individual remuneration of the members of the Board of Directors (except for the Directors Nikhil Kumar Thukral, Ginevra Ott and Maggie Fanari, who have declared that they accept the office without receiving any emolument), including, after hearing the opinion of the Board of Statutory Auditors in office at that date, the remuneration to be attributed to the Directors vested with special offices pursuant to Article 2389, paragraph 3, of the Civil Code.

The Board of Directors' meeting of July 20, 2021 therefore acknowledged the waiver by the Directors Nikhil Kumar Thukral, Ginevra Ott and Maggie Fanari of any emolument due to them by reason of the office held and, having heard the favorable opinion of the Board of Statutory Auditors, resolved to allocate, as from the Trading Commencement Date, a gross annual emolument of Euro 25,000.00, pro rata temporis, to each Director, in addition to the variable remuneration approved by the Shareholders' Meeting and to also allocate:

• a gross annual remuneration of Euro 20,000.00 to the Lead Independent Director, in addition to the emolument paid as Director;
• a gross annual remuneration of Euro 15,000.00 to the Chairperson of the Control and Risk Committee (hereinafter also the "CRC") and a gross annual remuneration of Euro 10,000.00 to the other members of the CRC, in addition to the remuneration for the office held as Directors;
• a gross annual remuneration of Euro 15,000.00 to the Chairperson of the ARC and a gross annual remuneration of Euro 10,000.00 to the other members of the ARC, in addition to the remuneration for the office held as Directors; and
• a gross annual remuneration of Euro 15,000.00 to the Chairperson of the Related Party Transactions Committee (hereinafter also the "RPT Committee") and a gross annual remuneration of Euro 10,000.00 to the other members, in addition to the remuneration for the office held as Directors.

All of this was subject to confirmation and ratification by the Board of Directors that it would become effective as of the Trading Commencement Date, which was subsequently confirmed on November 11, 2021, having heard the favorable opinion of the Board of Statutory Auditors.

Consistent with CG Code recommendations, the Remuneration of Directors not holding special offices or Non-Executive Directors does not include a variable component linked to the Company's financial performance. Directors shall also be entitled to reimbursement of documented expenses incurred by reason of their office. However, such remuneration is deemed sufficient to attract, motivate and retain Directors with the professional qualities required to successfully manage the Company.

2.3.2 Chairperson of the Board of Directors

Pay mix

The compensation package provided for the Chairperson of the Board of Directors includes only a fixed component - arising from the role of Executive Chairperson.

Fixed remuneration

More specifically, the Board of Directors meeting of July 20, 2021, having taken into account the total gross annual emolument approved by the Shareholders' Meeting on July 20, 2021, determined - with the favorable opinion of the Board of Statutory Auditors - to grant, pursuant to Article 2389, paragraph 3 of the Civil Code, to the Executive Chairperson Dario Gianandrea Ferrari a gross annual emolument of Euro 1,640,000.00 pro rata temporis and, in any case, without prejudice to any further remuneration of a variable nature attributed to him, subject to confirmation and ratification by the Board of Directors which would become effective as of the Trading Commencement Date, which occurred subsequently on November 11, 2021, having heard the favorable opinion of the Board of Statutory Auditors.

Non-monetary benefits

The Remuneration Policy allows the assignment of non-monetary benefits to Executive Directors (including the Chairperson) (including, but not limited to, the use of cell phones and laptop computers, company cars, supplementary health and accident, disability and death insurance coverage), in line with practices and in compliance with the criteria set out in the Remuneration Policy.

Moreover, the Company may take out for Executive Directors (including the Chairperson) the following insurance policies or social security or pension coverage, other than the compulsory and supplementary policies, with different terms and conditions and maximum amounts from time to time: supplementary life policy; accident policy - professional and extra-professional; supplementary health policy.

Indemnity in the case of dismissal or termination of employment

There are currently no agreements in place between the Company and the Chairperson of the Board of Directors that govern treatment in the event of termination of office or termination of employment except, in each case, as required by law. Finally, we note that no further non-monetary benefits are envisaged in favor of the Chairperson or the stipulation of consultancy contracts with the latter for a period following termination of the relationship.

Non-competition agreements

At the Reporting Date, there are no non-competition agreements between the Company and the Chairperson of the Board of Directors that provide for the payment of consideration in relation to the obligation arising from the agreement.

2.3.3 Chief Executive Officer and other Executive Directors

Pay mix

The compensation package provided for the Chief Executive Officer includes a fixed component and a shortterm and long-term variable component.

Taking into account the variable remuneration described below, the Chief Executive Officer's pay mix is as follows:

Similarly, the compensation package envisaged for the other Executive Directors (other than the Chairperson) includes a fixed component and a short-term and long-term variable component, and the related pay mix is shown below:

Fixed remuneration

The Board of Directors meeting of July 20, 2021, having taken into account the total gross annual emolument approved by the Shareholders' Meeting on July 20, 2021, determined - with the favorable opinion of the Board of Statutory Auditors - to grant, pursuant to Article 2389, paragraph 3 of the Civil Code:

• to the Chief Executive Officer a gross annual emolument of Euro 800,000.00 pro rata temporis (including the amount recognized against the Non Competion Agreement) and, in any case, without prejudice to any further remuneration of a variable nature attributed to him, subject to confirmation and ratification by the Board of Directors which would become effective as of the Trading Commencement Date, which occurred subsequently on November 11, 2021, having heard the favorable opinion of the Board of Statutory Auditors; and
• to the Executive Director Ludovica Arabella Ferrari a gross annual emolument of Euro 315,000.00 pro rata temporis and, in any case, without prejudice to any further remuneration of a variable nature attributed to her, subject to confirmation and ratification by the Board of Directors which would become effective as of the Trading Commencement Date, which occurred subsequently on November 11, 2021, having heard the favorable opinion of the Board of Statutory Auditors.

Executive Director Gianandrea Ferrari receives, in addition to his gross annual emolument as a Director for his position on the Board of Directors of Intercos, amounting to Euro 25,000.00, an additional remuneration - amounting to Euro 200,000.00 gross annually - for his position as Chairperson and Chief Executive Officer of Intercos Europe S.p.A.

Short-term variable incentive: STI

The annual incentive system (so-called STI), designed in line with the general principles on which the entire Remuneration Policy is based, mainly enables the pursuit of the following objectives:

• align management objectives with business strategies, directing management actions toward strategic objectives in harmony with business priorities;
• stimulate the achievement of excellent performance, through the recognition of a higher premium in the event of overperformance;
• management and monitoring of performance in the short term through annual evaluation of beneficiary performance on an annual basis.

The Chief Executive Officer's STI system for 2023, consistent with the nature and powers of this position, provides exclusively for Group targets of an economic and financial nature. It is based on the following performance targets:

2023 TARGETS	WEIGHTING
GROUP EBITDA	50%
GROUP PFN	30%
VALUE ADDED SALES	20%

The CEO's target pay opportunity will be 70% with a maximum opportunity of 105% of base salary.

The STI system of the other Executive Directors (other than the Chief Executive Officer and the Chairperson) for 2023 provides for the same operating mechanisms as those envisaged for the Chief Executive Officer, with an STI target value for those persons between 30% and 40% of the fixed remuneration and with a max pay-out opportunity between 45% and 60% of this remuneration and the provision economic/financial targets, as described below:

2023 TARGETS	LUDOVICA ARABELLA FERRARI	GIANANDREA FERRARI
	WEIGHTING
Group Ebitda	40%	25%
Group PFN	25%	15%
Value Added Sales	15%	10%
Function / LE / Country / Region / Individual Targets	20%	50%

Incentive curves

The amount of incentive actually disbursed varies according to the degree to which the goals assigned to individual targets are achieved.

Specifically, there is a linear curve for economic/financial and equity targets, which sets the minimum payout at 50% of the target bonus upon minimum achievement of the targets and its maximum value at 150% of the target bonus, awarded in the event of performance exceeding the targets. Intermediate payout results will therefore be calculated by linear interpolation, according to the system set out below: 50%

On the other hand, with regard to targets involving qualitative assessment, a "step curve" applies; this curve sets the minimum payout at 50% of the target bonus and its maximum payout at 150% of the assigned target bonus.

No intermediate levels of bonus payment are set.

Long-term variable incentive

In order to contribute to the achievement of long-term strategic objectives, the Company adopts a longterm incentive system that is designed to:

• guarantee the correlation between the interests of management and the creation of value for the shareholders in the long term, through the introduction in the remuneration structure of the beneficiaries of an economic incentive linked to the achievement of challenging long term company performance targets, directly linked to the value of the share and to indicators, including those of a non-economic nature;
• reward long-term performance through annual allocations (rolling) consistent with strategic objectives;
• build the loyalty of the beneficiaries, during the period of the plan, by conditioning the economic incentive envisaged by the plan to the continuation of the employment relationship with the Group for the period of the plan.

From 2023, Intercos plans to introduce an equity-based long-term incentive plan divided into three rolling cycles, each lasting three years (2023-2025, 2024-2026, and 2025-2027). In 2023, and subject to Shareholders' Meeting approval, the Company will adopt the 2023-2025 Incentive Plan based on performance shares. This plan, described in detail in the relevant Disclosure Document prepared in accordance with Article 114-bis of the CFA and Article 84-bis of the Issuers' Regulation, was made available to the public within the terms and in the manner prescribed by law and regulation and reference should be made to it for any detailed information regarding the plan. It constitutes further progress in continuously improving Intercos's Remuneration Policy, with a view to aligning the interests of management and those of shareholders ever more closely.

The main features of the 2023-2025 Incentive Plan are described below.

2023–2025 Incentive plan

As mentioned above, with reference to the current year, a new LTI plan based on performance shares for the 2023-2025 period will be submitted to the Shareholders' Meeting on April 28, 2023 for approval, as described in more detail in the following paragraph, which fits into the general structure outlined above with reference to the Intercos Group's long-term incentive system.

The objective of the 2023-2025 Plan is to grant certain employees and Directors of the Group the conditional, free of charge and non-transferable right by inter vivos deed to receive, in the event of the achievement of certain performance targets and a sustainability objective in continuation of their employment relationship with the companies of the Group, up to a maximum aggregate of 412,250 ordinary shares of the Company.

The 2023-2025 Plan is reserved for beneficiaries (employees and Directors of the Group) identified by the Board of Directors or to be identified by name by the Board of Directors upon the proposal of the Chief Executive Officer, no later than December 31, 2023, from among the managers of the Company or its subsidiaries (including Executive Directors and SEs) who hold positions with the greatest impact on the Company's results or with strategic importance for the achievement of the Group's long-term objectives. Specifically, the 2023-2025 plan provides for:

• 1. Two performance targets, in terms of Relative Total Shareholder Return (weighting of 45%) and Earning per Share at consolidated level (weighting of 35%) - which will must be verified by the Board of Directors on the approval of the Group's consolidated financial statements at December 31, 2025;
• 2. A sustainability target (with a weighting of 20%), linked to the reduction of Scope 1 and Scope 2 CO2 Emissions to 2025 as detailed below.

The performance targets and the sustainability target are independent, i.e. achieving the minimum value of at least one performance target or the sustainability target will result in the allocation of shares under the 2023-2025 Plan.

The verification of the achievement the targets of the 2023-2025 Plan, for the determination of the number of shares to be granted, was made by the Board of Directors, based on the target number of shares established for each beneficiary, up to a maximum number of shares equal to 170% of the target number.

For each target, the 2023-2025 Plan includes the following pay-out curve:

Relative TSR 2025

In particular, Intercos's positioning in the relevant peer group5 will be checked, as shown below:

		180.0%
Ranking	Pay-out curve	160.0%	1st = 170%
		2nd = 150% 140.0%
1°	170%	3rd = 130% 120.0%
2°	150%	100.0% 4th = 100%
3°	130%	Pay-out (% of target) 5th = 80% 80.0%
4°	100%	60.0% 6th = 50% 40.0%
5°	80%	20.0%
6°	50%	0%
7° - 8° - 9° - 10° - 11° - 12°	0%	ENTRY LEVEL TARGET TSR Ranking	MAXIMUM

5 The panel of companies to which Intercos's TSR will be compared is as follows: 1. Cosmax; 2. Coty, Inc.; 3. Givaudan; 4. International Flavors & Fragrances, Inc.; 5. Korea Kolmar; 6. L'Oréal SA; 7. Shiseido Co. Ltd.; 8. Symrise AG; 9. The Estée Lauder Companies, Inc.; 10. FTSE Mid Cap Index; 11. New York Stock Exchange Index

Cumulative EPS 2025

Reduction of CO2 Emissions – Scope 1 and Scope 2

20% reduction by 2025 of Scope 1 and 2 GHG emissions (market-based) on millions of parts produced by Group production sites compared to 2019 values.

Performance

The Plan has a three-year performance period. The shares granted to each beneficiary under the 2023- 2025 Plan will be subject to a lock-up restriction period of 12 (twelve) months from the date of their allocation.

In any case, the Board of Directors will put in place a procedure allowing the beneficiaries to opt, when the shares are assigned, for a cashless method consisting in the simultaneous sale of the portion of shares needed to pay the withholding tax (sell-to-cover method).

The time horizon for the plan as a whole, including the allocation and vesting of shares and the lock-up period, is about five years in total.

Other long-term incentive plans

Please note that Intercos currently has another equity-based incentive plan in place: the 2022-2024 Performance Share Plan.

Under this share plan, shareholder value growth that is persistent and sustainable over time and that allows for greater alignment with market practices, CG Code guidance, and Strategic Plan targets may be rewarded.

For details regarding the 2022-2024 Performance Share Plan, please refer to the 2022 Remuneration Report, available on the Company's website (Governance Section).

Good and bad leaver and clawback clauses

The long-term incentive plans provide for good and bad leaver clauses and clawback clauses in cases where it is ascertained that the shares were granted (i) in the event that the beneficiary violated company or legal regulations or was guilty of willful or grossly negligent conduct aimed at altering the data used to achieve the performance targets, or (ii) on the basis of data that subsequently turned out to be manifestly incorrect.

Retention bonuses and other types of monetary incentives

The Company may provide for the payment of retention bonuses to Executive Directors (including the Chief Executive Officer and excluding the Executive Chairperson), in exceptional cases and subject to the opinion of the ARC, in order to encourage the retention of resources with specific skills and high-level professionalism deemed necessary for the achievement of the Group's objectives

36 REMUNERATION POLICY AND REPORT

In particular, there is a retention bonus for the Chief Executive Officer which may be paid as of 5 years from the date of Listing and is quantified on the basis of the increase in market capitalization of 100% of the Company's shares, determined on the basis of the weighted average price of the shares as recorded on the target date (fifth anniversary of Listing) and in the 29 market days prior to that date, provided that the Director holds office continuously during the period considered and excluding any discretionary mechanism for the allocation and quantification of the bonus.

Solely for the purposes of completeness, it should be noted that the Chief Executive Officer, in addition to the incentive and retention plan granted to him by the Company, is also the beneficiary of a separate retention plan that provides for the payment of a cash bonus of Euro 680,000.00 on each anniversary of the Trading Commencement Date for a period of 5 years (i.e. until November 2, 2026), conditional solely on his remaining in office as Chief Executive Officer of Intercos, specifying that the payment of this bonus will be borne exclusively by the controlling shareholder of Intercos (through its subsidiary Dafe 3000 S.r.l.) and that the aforementioned plan does not entail any obligation for Intercos.

Non-monetary benefits

The Chief Executive Officer and other Executive Directors may be eligible for the same non-monetary benefits provided under the Remuneration Policy for the Chairperson.

Indemnity in the case of dismissal or termination of employment

There are currently no agreements in place between the Company and the Chief Executive Officer that govern treatment in the event of termination of office or termination of employment except, in each case, as required by law. The same applies in the case of Executive Directors. In this regard, it should be noted that no further non-monetary benefits are envisaged in favor of the Chief Executive Officer or the other Executive Directors or the stipulation of consultancy contracts with these latter for a period following termination of the relationship.

Non-competition agreements

The Company has entered into a non-competition agreement with the Chief Executive Officer valid for twelve months from the date of termination of his office in return for remuneration equal to 11% of the related fixed remuneration on an annual basis, the amount of which is paid on a continuing basis. There are no non-competition agreements with the other Executive Directors.

2.3.4 Senior Executives

At the date of this Report, the Board of Directors have identified the following individuals as "Senior Executives":

NOME E COGNOME	RUOLO
PIETRO ORIANI	Group Chief Financial Officer
VITTORIO BRENNA	Global Senior Vice President, Industrial Operations
MORENA GENZIANA	Group Chief Commercial Officer
FILIPPO MANUCCI	Global Senior Vice President, BU Skin, Hair, Personal Care & Fragrances
MATTEO MILANI	Chief Purchasing Officer

The above list may be subject to change due to departures or recruitment of SEs, to be identified according to the definition above. SE remuneration is set at a rate consistent with their roles, responsibilities, and professionalism.

Pay mix

The compensation package for SEs includes a fixed component provided for the Executive or Director relationship with the company, a short-term variable component and a long-term variable component.

Fixed remuneration

The gross annual remuneration of SEs is determined on the basis of the role and responsibilities assigned considering the remuneration levels on the market for roles of similar level of responsibility and managerial complexity and may be adjusted periodically, as part of the annual salary review process involving the entire managerial population. In particular, the Remuneration Policy envisages the possibility of carrying out salary adjustments aimed at aligning remuneration levels with the market, for resources that have expanded their responsibilities or role, as well as persons in organizational positions considered critical to Intercos' business. It is also possible to provide for the payment of a one-off sum in extraordinary situations involving a limited number of resources, in the presence of excellent performance on activities/projects of a strategic nature for the Company, or in consideration of attraction and retention requirements.

Short-term variable incentive: STI

The STI for SEs is aligned in operation with the short-term incentive system for the Chief Executive Officer and Executive Directors (other than the Chairperson), with the addition of individual performance targets:

OBIETTIVO	PESO
GROUP EBITDA	40%
GROUP NET FINANCIAL POSITION	25%
VALUE ADDED SALES	15%
FUNCTION / LE / COUNTRY/ REGION/ INDIVIDUAL TARGETS	20%

As described above, the short-term incentive system for SEs envisages the same operating mechanisms as those for the Chief Executive Officer and Executive Directors (other than the Chairperson), with a STI target value of between 30% and 40% of fixed remuneration that can be increased up to a maximum of 45%-60% of fixed remuneration in the event of overperformance.

Long-term variable incentive

By Board of Directors' motion, SEs may be eligible for the same long-term incentive plan described above for the Chief Executive Officer.

Average pay mix

LTI STI FIXED

0% TARGET MAXIMUM 20% 10% 30% 50% 70% 90% 40% 60% 80% 100% 54% 34% 42% 20% 24% 26%

Non-monetary benefits

The remuneration offer is integrated with the non-monetary benefits provided for by the relevant national collective bargaining agreements (CCNL) and company practices (i.e., professional and extra-professional accident policy, disability and death policy, supplementary pension, supplementary medical insurance and annual check-up, allocation of a car for mixed use and fuel card, company devices).

Special bonus

The Company may, in exceptional cases, decide to award special bonuses, for specific transactions deemed exceptional in terms of strategic importance and effect on Intercos' results, subject to the prior opinion of the ARC and subject to the application of the Related Party Transactions Policy (where applicable).

Indemnity in the case of dismissal or termination of employment

In the event of early termination of the employment relationship at the Company's initiative, amounts may be paid in the form of ex-ante agreements or at the time of termination, defined taking into account the responsibilities entrusted and the work performed. Specifically, the Company, on the occasion of and in connection with the termination of the employment relationship, may grant individual SEs additional economic benefits with respect to what is owed pursuant to the provisions of current law and applicable national and company collective bargaining agreements.

In addition, SEs may be granted a severance indemnity in accordance with the national collective bargaining agreement relevant from time to time, not linked to performance criteria. In any case, both the above additional remuneration and the severance indemnity may not exceed 24 months' salary, and must be within the limits provided for by the applicable national collective bargaining agreements (CCNL). We also note that, in cases of good leaver, the SEs maintain the rights assigned as part of long-term incentive plans and that, if the relationship is terminated before the expiry of the related plan, these rights shall be calculated pro-rata temporis.

Subject to the above, no further non-monetary benefits are provided for SEs or the stipulation of consultancy contracts for a period following termination of the employment relationship.

Non-competition agreements

At present, with reference to the SEs, in cases where they have such know-how and skills that the termination of the employment relationship could entail risks for the Company, the latter can apply noncompetition agreements, the amount of which is defined within 75% of the gross annual remuneration and disbursed after the termination of the employment relationship, against agreements which, as a rule, have a duration of one year.

2.3.5 Remuneration of the members of the Control Board

Pursuant to Article 2402 of the Civil Code, the remuneration of the members of the Board of Statutory Auditors is determined by the Shareholders' Meeting upon appointment for the entire duration of their office, as a fixed annual amount. Statutory Auditors are also reimbursed for documented expenses incurred in the performance of their duties.

The Shareholders' Meeting of July 20, 2021 set the gross annual remuneration payable to the Board of Statutory Auditors at a total of Euro 80,000, all-inclusive, broken down as follows:

NOME E COGNOME	CARICA	EMOLUMENTO ANNUO LORDO
MATTEO TAMBURINI	Chairperson of the Board of Statutory Auditors	Euro 30,000.00
MONICA MANZINI	Statutory Auditor	Euro 25,000.00
GIOVANNI ROSSI	Statutory Auditor	Euro 25,000.00

B

SECTION II: COMPEN- SATION PAID

1.INTRODUCTION

This section is divided into two parts that illustrate respectively:

• in Part One, the various elements that make up remuneration (including treatment in the event of termination of office or termination of employment), illustrating consistency with best practice remuneration policy;
• in Part Two, by means of the appended tables, the remuneration of the members of the Board of Directors and Board of Statutory Auditors and the information on the equity investments in the Company held by them, as well as the remuneration of the other SEs.

This section is subject to a non-binding vote by the Shareholders' Meeting, as provided for by Article 123 ter of the CFA, which sets out in paragraph 6: "Without prejudice to the provisions [...] the Shareholders' Meeting convened [...] shall resolve in favor or against the second section of the Report provided for in paragraph 4. The motion is not binding."

Moreover, the party appointed to carry out the legal audit of the financial statements verified that the Directors had prepared this section, as required by Article 123-ter of the CFA.

The remuneration of the members of the Board of Directors and Board of Statutory Auditors is shown by individual; the remuneration of the other SEs is shown in aggregate form.

With reference to each of the items making up remuneration, including the treatment provided for in the event of termination of office or termination of employment, reference should be made to that described in Section I. Please note that this Section II also contains information on the status of implementation of the 2022-2024 Incentive Plan.

PART ONE-REMUNERATION ITEMS 2.

2.1PROPORTION BETWEEN FIXED AND VARIABLE COMPENSATION PAID

The following is an indication of the proportion of fixed and variable compensation attributable to the Chairperson, Chief Executive Officer, other Executive Directors and SEs in 2022 (the average pay-mix will be considered for SEs).

2.2FIXED REMUNERATION

2.2.1 Directors not holding special offices and members of the internal Board committees

On July 20, 2021, the Company's Ordinary Shareholders' Meeting resolved to set the total annual gross emolument for the Board of Directors at Euro 3,005,000.00, delegating the Board of Directors to determine the individual remuneration, without taking into account the variable remuneration deriving from the incentive plans that may be approved by the Company and without prejudice to the power of the Board of Directors to attribute to the Directors vested with special offices any additional remuneration and bonuses pursuant to Article 2389, paragraph 3, of the Civil Code, having heard the opinion of the Board of Statutory Auditors.

Also on July 20, 2021, the Board of Directors of the Company, taking into account the total annual gross emolument approved by the Shareholders' Meeting as specified above, determined the individual remuneration of the members of the Board of Directors (except for the Directors Nikhil Kumar Thukral, Ginevra Ott and Maggie Fanari, who have declared that they accept the office without receiving any emolument for their entire term in office, i.e. until the approval of the 2023 financial statements), including, after hearing the opinion of the Board of Statutory Auditors in office at that date, the remuneration to be attributed to the Directors vested with special offices pursuant to Article 2389, paragraph 3, of the Civil Code, namely the Executive Chairperson Mr. Dario Gianandrea Ferrari, the Chief Executive Officer Mr. Renato Semerari and the Executive Director Ms. Ludovica Arabella Ferrari.

The Board of Directors' meeting of July 20, 2021 therefore acknowledged the waiver by the Directors Nikhil Kumar Thukral, Ginevra Ott and Maggie Fanari of any emolument due to them by reason of the office held and, having heard the favorable opinion of the Board of Statutory Auditors, resolved to allocate, as from the Trading Commencement Date, a gross annual emolument of Euro 25,000.00, pro rata temporis, to each Director, in addition to the variable remuneration approved by the Shareholders' Meeting and to also allocate:

• a gross annual remuneration of Euro 20,000.00 to the Lead Independent Director, Nikhil Srinivasan, in addition to the emolument paid to him as Director;
• a gross annual remuneration of Euro 15,000.00 to Nikhil Srinivasan, as Chairperson of the CRC and a gross annual remuneration of Euro 10,000.00 to the other members of the CRC, Michele Scannavini and Ciro Piero Cornelli, in addition to the remuneration for the office held as Directors;
• a gross annual remuneration of Euro 15,000.00 to Patrizia de Marchi, as Chairperson of the ARC and a gross annual remuneration of Euro 10,000.00 to the other members of the ARC, Michele Scannavini and Ciro Piero Cornelli, in addition to the remuneration for the office held as Directors; and
• a gross annual remuneration of Euro 15,000.00 to Michele Scannavini as Chairperson of the RPT Committee and a gross annual remuneration of Euro 10,000.00 to the other members Patrizia De Marchi and Nikhil Srinivasan, in addition to the remuneration for the office held as Directors.

2.2.2 Chairperson of the Board of Directors

The Board of Directors meeting of July 20, 2021, having taken into account the total gross annual emolument approved by the Shareholders' Meeting on July 20, 2021, determined - with the favorable opinion of the Board of Statutory Auditors - to grant, pursuant to Article 2389, paragraph 3 of the Civil Code, to the Executive Chairperson Dario Gianandrea Ferrari an annual emolument of Euro 1,640,000.00 pro rata temporis and, in any case, without prejudice to any further remuneration of a variable nature attributed to him.

2.2.3 Chief Executive Officer and Executive Directors

In the Board meeting of July 20, 2021 it was resolved to award:

• to the Chief Executive Officer, Renato Semerari, an annual compensation of Euro 800,000.00 (including the amounts paid for the Non-Competition Agreement); and
• to the Executive Director Ludovica Arabella Ferrari an annual compensation of Euro 315,000.00,

in both cases, pro rata temporis, and in any case subject to the additional variable remuneration allocated to them.

The Executive Director Gianandrea Ferrari receives additional remuneration to that paid by Intercos as he holds executive positions in the Group company Intercos Europe S.p.A., for a total of Euro 225,000.00 (including Euro 25,000.00 paid for his position as Director of Intercos).

2.2.4 SEs

SEs (including SEs whose employment ended in FY2022) were paid aggregated fixed salaries totaling Euro 1,413,739.

2.3 SHORT-TERM VARIABLE COMPENSATION

2.3.1 Chief Executive Officer and Executive Directors

In 2022, both the Chief Executive Officer and the Executive Directors matured the STI short-term incentive, based on the performance achieved in reaching the targets set for the respective positions, as calculated on the basis of the draft Financial Statements for the year 2022, which is submitted for approval to the Shareholders' Meeting which approves Section I of this Report.

Specifically, the Chief Executive Officer will be paid annual variable remuneration expected to amount to Euro 553,652.99 in 2022. The achievement of the individual targets assigned is summarized in the following table:

With regard to the Executive Directors, the following annual variable remuneration will be paid for 2022:

• an amount of Euro 102,060.00 to Ludovica Arabella Ferrari. The achievement of the individual targets assigned is summarized in the following table:

• an amount of Euro 66,047.07 to Gianandrea Ferrari. The achievement of the individual targets assigned is summarized in the following table:

2.3.2 SEs

The SEs matured - based on the draft Financial Statements for FY 2022 - a total annual variable remuneration of Euro 536,939.62, equivalent to an average payout of 99.26%. The overall average achievement of individual financial targets was approximately 98%.

2.4 NON-MONETARY BENEFITS

In line with the Remuneration Policy, non-monetary benefits were recognized for the Chairperson, Chief Executive Officer and Executive Directors and SEs in 2022, the value of which is shown in Table 1.

2.5TERMINATION OF OFFICE OR EMPLOYMENT

During the reporting year, one SE's employment ended, following voluntary resignation effective June 1, 2022.

Under the relevant contractual provisions and in accordance with the current Remuneration Policy, the loss of rights connected with the existing incentive system whose performance period did not end on the date of the end of employment was determined in accordance with the plans' rules.

In addition to the amounts due for vacation not taken and 13th month accruals, a total of Euro 262,500 gross was awarded under a non-competition agreement, to be disbursed in monthly installments for the period of the agreement (12 months in total).

2.6EXCEPTIONS TO THE REMUNERATION POLICY

No exceptions to the Remuneration Policy were applied.

2.7 VARIABLE COMPONENT EX-POST CORRECTION MECHANISMS

In 2022, no ex-post correction mechanisms - such as malus or clawback - were applied to the variable components.

2.8 ANNUAL CHANGE IN REMUNERATION

In light of the provisions of the Issuers' Regulation, the comparison and change in compensation for 2022 and 2021 are shown, to provide a more meaningful picture of the results achieved. The remuneration data taken into account for those individuals for whom the information in this section of the Report is provided by name is consistent with Table 1 for the relevant years of publication; the Personnel Remuneration data refers to all employees of the Group's Italian companies.

	ROLE	2021	2022
Dario Gianandrea Ferrari	Chairperson BoD	100	97
Renato Semerari	CEO	100	107
Ludovica Arabella Ferrari	Director	100	111
Gianandrea Ferrari	Director	100	123
Nikhil Kumar Thukral(1)	Director	-	-
Ciro Piero Cornelli(2)	Director	100	159
Nikhil Srinivasan(2)	Director and LID	100	156
Michele Scannavini(2)	Director	100	195
Patrizia De Marchi(2)	Director	100	600
Ginevra Ott(1)	Director	-	-
Maggie Fanari(1)	Director	-	-
Board of Statutory Auditors
Matteo Tamburini(2)	Chairperson of the SC	100	123
Maria Maddalena Gnudi(3)	Statutory Auditor	100	62
Giovanni Rossi(2)	Statutory Auditor	100	600
Monica Manzini(4)	Statutory Auditor	-	100

PERSONNEL	100	105
EBITDA	100	120

(1) Waiver of compensation for office.

Francesca Pischedda

(2) Pro rata compensation in 2021 from the date of appointment to committees.

(3) Resigned from office on April 21, 2022.

(4) appointed on April 21, 2022

Maurizio Nastri

2.9 VOTE CAST BY THE SHAREHOLDERS' MEETING IN 2022

In considering and evaluating the updates and improvements made to the Remuneration Policy and this document as a whole (including this Section II on compensation paid), the results of the votes cast at the 2022 Shareholders' Meeting were taken into account, with a view to continually improving the disclosure standards adopted by Intercos.

Alternate Auditor

Alternate Auditor

-

-

100

100

PART TWO - BREAKDOWN OF FEES PAID DURING THE YEAR 3.

48 REMUNERATION POLICY AND REPORT

49 50 INTERCOS GROUP REMUNERATION POLICY AND REPORT

Table 1				Remuneration paid to the members of the management and control boards, General Managers and Senior Executives (Euro)
(A)	(B)	(C)	(D)	(1)	(2)	(3)		(4)	(5)	(6)	(7)	(8)
	Period of Conclusion Name Office office of office				Remun. for	Non equity variable remuneration		Non			Fair Value	Termination of
		Fixed remuneration	committee attendance	Bonuses and other incentives	Profit sharing	monetary benefits (19)	Other re muneration	Total	of equity remuneration	office/employment indemnity
Dario Gianandrea Ferrari	Executive Chairperson BoD	2022	31/12/2023
(I) Emoluments for office in company				1,640,000 (1)				20,600		1,660,600
(II) Remuneration from subsidiaries and associated companies				60,000 (2)						60,000
(III) Total				1,700,000				20,600		1,720,600
Renato Semerari	Chief Executive Officer	2022	31/12/2023
(I) Emoluments for office in company				800,000 (3)		553,653		10,781		1,364,434	703,000
(II) Remuneration from subsidiaries and associated companies
(III) Total				800,000		553,653		10,781		1,364,434	703,000
Ludovica Arabella Ferrari	Chief Executive Officer	2022	31/12/2023
(I) Emoluments for office in company				315,000 (4)		102,060		9,036		426,096	168,720
(II) Remuneration from subsidiaries and associated companies
(III) Total				315,000		102,060		9,036		426,096	168,720
Gianandrea Ferrari	Chief Executive Officer	2022	31/12/2023
(I) Emoluments for office in company				25,000				1,492		26,492	112,480
(II) Remuneration from subsidiaries and associated companies				182,500 (5)		66,047				248,547
(III) Total				207,500		66,047		1,492		275,039	112,480
Nikhil Kumar Thukral	Director	2022	31/12/2023
(I) Emoluments for office in company				(6)
(II) Remuneration from subsidiaries and associated companies
(III) Total
Michele Scannavini	Director, CRC Member, ARC member, Chairperson RPT Committee	2022	31/12/2023
(I) Emoluments for office in company				25,000	35,000 (7)					60,000
(II) Remuneration from subsidiaries and associated companies
(III) Total				25,000	35,000					60,000

51 52 INTERCOS GROUP REMUNERATION POLICY AND REPORT

Table 1				Remuneration paid to the members of the management and control boards, General Managers and Senior Executives (Euro)
(A)	(B)	(C)	(D)	(1)	(2)	(3)		(4)	(5)	(6)	(7)	(8)
				Fixed remuneration	Remun. for	Non equity variable remuneration		Non			Fair Value	Termination of
Name	Office	Period of office	Conclusion of office		committee attendance	Bonuses and other incentives	Profit sharing	monetary benefits (19)	Other re muneration	Total	of equity remuneration	office/employment indemnity
Nikhil Srinivasan	Director & Lead Independent Director RPT Committee member Chairperson CRC	2022	31/12/2023
(I) Emoluments for office in company				45,000	25,000 (8)					70,000
(II) Remuneration from subsidiaries and associated companies
(III) Total				45,000	25,000					70,000
Ciro Piero Cornelli	Director CRC Member ARC member	2022	31/12/2023
(I) Emoluments for office in company				25,000	20,000 (9)					45,000
(II) Remuneration from subsidiaries and associated companies
(III) Total				25,000	20,000					45,000
Ginevra Ott	Director	2022	31/12/2023
(I) Emoluments for office in company				(6)
(II) Remuneration from subsidiaries and associated companies
(III) Total
Patrizia De Marchi	Director, RPT Committee, member Chairperson ARC	2022	31/12/2023
(I) Emoluments for office in company				25,000	25,000 (10)					50,000
(II) Remuneration from subsidiaries and associated companies
(III) Total				25,000	25,000					50,000
Maggie Fanari	Director	2022	31/12/2023	(6)
(I) Emoluments for office in company
(II) Remuneration from subsidiaries and associated companies
(III) Total
Matteo Tamburini	Chairperson of the Board of Statutory Auditors	2022	31/12/2023
(I) Emoluments for office in company				30,000 (11)						30,000
(II) Remuneration from subsidiaries and associated companies				15,000 (12)						15,000
(III) Total				45,000						45,000

53 54 INTERCOS GROUP REMUNERATION POLICY AND REPORT

Table 1 Remuneration paid to the members of the management and control boards, General Managers and Senior Executives (Euro)
(A)	(B)	(C)	(D)	(1)	(2)	(3)		(4)	(5)	(6)	(7)	(8)
					Remun. for	Non equity variable remuneration		Non			Fair Value	Termination of
Name	Office	Period of office	Conclusion of office	Fixed remuneration	committee attendance	Bonuses and other incentives	Profit sharing	monetary benefits (19)	Other re muneration	Total	of equity remuneration	office/employment indemnity
Maria Maddalena Gnudi	Statutory Auditor	2022	21/04/2022
(I) Emoluments for office in company				7,603 (13)						7,603
(II) Remuneration from subsidiaries and associated companies				14,000 (14)						14,000
(III) Total				21,603						21,603
Giovanni Rossi	Statutory Auditor	2022	31/12/2023
(I) Emoluments for office in company				25,000 (15)						25,000
(II) Remuneration from subsidiaries and associated companies
(III) Total				25,000						25,000
Monica Manzini	Alternate Auditor / Statutory Auditor	2022	31/12/2023
(I) Emoluments for office in company				17,397 (16)						17,397
(II) Remuneration from subsidiaries and associated companies
(III) Total				17,397						17,397
Francesca Pischedda	Alternate Auditor	2022	31/12/2023	(*)
(I) Emoluments for office in company
(II) Remuneration from subsidiaries and associated companies
(III) Total
Maurizio Nastri	Alternate Auditor	2022	31/12/2023	(*)
(I) Emoluments for office in company
(II) Remuneration from subsidiaries and associated companies				4,000 (17)						4,000
(III) Total				4,000						4,000

54

• (*) no fee is currently envisaged for the position of Alternate Auditor
• (1) remuneration pursuant to Article 2389, paragraph 3, of the Civil Code, as resolved by the Shareholders' Meeting of 02/12/2020 and confirmed at the Shareholders' Meeting of 07/20/2021 of Intercos
• (2) fees paid to Dr. D. G. Ferrari by Intercos Paris in his capacity as Gérant
• (3) compensation paid as per the Intercos Shareholders' Meeting motion of 07/20/2021
• (4) compensation paid as per the Intercos Shareholders' Meeting motion of 07/20/2021
• (5) emolument paid by Intercos Concept, as resolved by the Shareholders' Meeting of 02/12/2020 of Intercos Concept pro rata until 06/30/2022. Effective 07/01/2022, as resolved by the Board of Directors of Intercos Europe on 07/13/2022, new pro rata compensation of Euro 200,000 gross
• (6) the Director waived the fee
• (7) in addition to the remuneration as Director (as resolved by the Shareholders' Meetings of 02/12/2020 and 07/20/2021), amounts resolved by the Shareholders' Meeting of 07/20/21: Euro 10,000 as member of the CRC; Euro 10,000 as member of the ARC; Euro 15,000 as Chairperson of the RPT Committee
• (8) in addition to the remuneration as Director (as resolved by the Shareholders' Meetings of 02/12/2020 and 07/20/2021), amounts resolved by the Shareholders' Meeting of 07/20/2021: Euro 20,000 as Lead Independent Director; Euro 15,000 as Chairperson of CRC; Euro 10,000 as member of the RPT Committee
• (9) in addition to the remuneration as Director (as resolved by the Shareholders' Meetings of 02/12/2020 and 07/20/2021), amounts resolved by the Shareholders' Meeting of 07/20/2021: Euro 10,000 as member of the CRC; Euro 10,000 as member of the ARC
• (10) in addition to the remuneration as Director (as resolved by the Shareholders' Meeting of 07/20/2021), amounts resolved by the Shareholders' Meeting of 07/20/2021: Euro 15,000 as Chairperson of the ARC; Euro 10,000 as member of the RPT Committee
• (11) amount referred to the position of Chairperson of the Board of Statutory Auditors, as resolved by the Shareholders' Meeting on 07/20/2021
• (12) remuneration consisting of Euro 10,000 and Euro 5,000 paid for the positions held in Intercos Europe (motion of the Intercos Europe Shareholders' Meeting of 29/04/2019) and Cosmint (motion of the Cosmint Shareholders' Meeting of 11/02/2020) respectively
• (13) pro rata compensation for the office of Statutory Auditor, as per the Shareholders' Meeting motion of 07/20/2021, until April 21, 2022, date of resignation from office
• (14) remuneration consisting of Euro 10,000 and Euro 4,000 paid for the positions held in Intercos Europe (motion of the Intercos Europe Shareholders' Meeting of 29/04/2019) and Cosmint (motion of the Cosmint Shareholders' Meeting of 11/02/2020) respectively
• (15) remuneration for the position of Statutory Auditor, as approved by the Shareholders' Meeting on 07/20/2021
• (16) pro-rata remuneration for the office of Statutory Auditor. Following the resignation of the Statutory Auditor Ms. Maria Maddalena Gnudi on April 21, 2022 as a result of unexpected professional commitments, the Alternate Auditor Ms. Monica Manzini assumed the role of Statutory Auditor as per Article 2401 of the Civil Code. Ms. Monica Manzini remained in office until the Shareholders' Meeting of April 29, 2022 and in prorogatio until the Shareholders' Meeting of June 29, 2022, which by unanimous vote of those present, approved the supplementation of the Board of Statutory Auditors of the company as per Article 2401 of the Civil Code, appointing, on the proposal presented by the shareholder Dafe 4000 S.r.l. ( and therefore without undertaking slate voting), Ms. Monica Manzini as Statutory Auditor, and Ms. Francesca Pischedda as Alternate Auditor.
• (17) remuneration for the office held in Cosmint, as resolved by the Cosmint Shareholders' Meeting of 11/02/2020
• (18) the remuneration for a SE was converted into Euros from US Dollars, at the average 2022 exchange rate of 1.0530
• (19) the value may include, inter alia, motor vehicles, insurance policies and supplementary pension plans

Table 1 Remuneration paid to the members of the management and control boards, General Managers and Senior Executives (Euro)

(A)	(B)	(C)	(D)	(1)	(2)	(3)		(4)	(5)	(6)	(7)	(8)
Remun. for Period of Conclusion Name Office Fixed remuneration office of office attendance						Non equity variable remuneration		Non			Fair Value	Termination of
	committee	Bonuses and other incentives	Profit sharing	monetary benefits (19)	Other re muneration	Total	of equity remuneration	office/employment indemnity
Senior Executives (5)	AGGREGATE FORM
(I) Emoluments for office in company				771,372		298,389		45,909		1,115,690	674,880	262,500
(II) Remuneration from subsidiaries and associated companies				642,367 (18)		238,551		5,278		886,196
(III) Total				1,413,739		536,940		51,207		2,001,886	674,880	262,500

57 58 INTERCOS GROUP REMUNERATION POLICY AND REPORT

TABLE 3A	Financial instrument-based incentive plans, other than stock options, in favor of members of the Board of Directors, General Managers and other Senior Executives
			year	Financial instruments granted in previous years not vested in the	Financial instruments granted in the year				Financial instruments vested in the year and not allocated	Financial instruments vested in the year and allocated		Financial instruments accruing in the year
A	B	(1)	(2)	(3)	(4)	(5)	(6)	(7)	(8)	(9)	(10)	(11)	(12)
Name	Office	Plan	Number and type financial instru ments	Vesting period	Number and type of finan cial instru ments	Fair value at grant date	Vesting period	Assignment date	Market price on grant	Number and type of financial instruments	Number and type of financial instruments	Value at vesting date	Fair Value
Renato Semerari	Chief Executive Officer
(I) Emoluments for office in company		LTI 2022-2024 (20/07/2021)	150,000 Performance Shares	1/1/2022 - 31/12/24									703,000
(II) Remuneration from subsidiaries and associated companies
(III) Total													703,000
Ludovica Arabella Ferrari	Executive Director
(I) Emoluments for office in company		LTI 2022-2024 (20/07/2021)	36,000 Performance Shares	1/1/2022 - 31/12/24									168,720
(II) Remuneration from subsidiaries and associated companies
(III) Total													168,720
Gianandrea Ferrari	Executive Director
(I) Emoluments for office in company		LTI 2022-2024 (20/07/2021)	24,000 Performance Shares	1/1/2022 - 31/12/24									112,480
(II) Remuneration from subsidiaries and associated companies
(III) Total													112,480
Senior Executives (5)	AGGREGATE FORM
(I) Emoluments for office in company		LTI 2022-2024 (20/07/2021)	144,000 Performance Shares										674,880
(II) Remuneration from subsidiaries and associated companies
(III) Total													674,880

59 60 INTERCOS GROUP REMUNERATION POLICY AND REPORT

Table		3

Table 3B Monetary incentive plans in favor of members of the Board of Directors, General Managers and other Senior Executives

A	B	(1)		(2)		(3)			(4)
				Bonus for the year			Other bonuses
Name	Office	Plan	(A)	(B)	(C)	(A)	(B)	(C)
			Payable/ Paid	Deferred	Deferred period	No longer issuable	Payable/ Paid	Still deferred
Renato Semerari	Chief Executive Officer
(I) Emoluments for office in company		STI 2022	553,653
(II) Remuneration from subsidiaries and associated companies
(III) Total			553,653
Ludovica Arabella Ferrari	Executive Director
(I) Emoluments for office in company		STI 2022	102,060
(II) Remuneration from subsidiaries and associated companies
(III) Total			102,060
Gianandrea Ferrari	Executive Director
(I) Emoluments for office in company
(II) Remuneration from subsidiaries and associated companies		STI 2022	66,047
(III) Total			66,047
Senior Executives (5)	AGGREGATE FORM
(I) Emoluments for office in company		STI 2022	298,389
(II) Remuneration from subsidiaries and associated companies		STI 2022	238,551
(III) Total			536,940

Scheme No. 7-TER - Table 1

Shareholdings of the Board of Directors and Statutory Auditors and General Managers

Surname and name	Office	Company	Number of shares held at the end of the previous year (2021)	Number of shares acquired	Number of shares sold	Number of shares held at the end of the current year (2022)
Dario Gianandrea Ferrari			0	192,488	0	192,488
Dario Gianandrea Ferrari (through DAFE 3000 S.r.l. and DAFE 4000 S.r.l.)	Executive Chairperson of the BoD*	Intercos	27,450,958	0	4,642,506	22,808,452
Dario Gianandrea Ferrari (through DAFE 5000 S.r.l.)			11,319,447	0	3,320,786	7,998,661
Renato Semerari	Chief Executive Officer	Intercos 830,173				830,173
Ludovica Arabella Ferrari	Executive Director	Intercos 40,510		56,900	26,174	71,236
Gianandrea Ferrari	Executive Director	Intercos	0	37,933	0	37,933

(*) Title and method of ownership of the shares in Intercos S.p.A. held indirectly by Dario Gianandrea Ferrari:

• the table shows the shares of Intercos S.p.A. held directly by Dafe 4000 S.r.l., which is controlled by Dafe 3000 S.r.l., in turn controlled by Dario Gianandrea Ferrari;
• the table shows the shares of Intercos S.p.A. held directly by Dafe 5000 S.r.l., which is controlled by Dario Gianandrea Ferrari.
• the shareholder has obtained multi-voting rights

Scheme No. 7-TER Table 2 Shareholdings of other Senior Executives

Number	Company	Number of shares held at	Number	Number	Number of shares
of Senior		the end of the previous	of shares	of shares	held at the end of the
Executives		year (2021)	acquired	sold	current year (2022)
5	Intercos	95,245	156,474	71,979	179,770

Schedule 1, Section 2 Newly awarded instruments, based on the decision:

• of the Board of Directors' proposal to the Shareholders' Meeting

Name or category	Office	Date of the Sha rehol ders' Meeting motion	Number of financial instruments granted	Number of financial instruments granted	Grant date	Purchase price of the instruments	Market price on grant date (Euro)	Vesting period
Renato Semerari	Chief Executive Officer	LTI 2022-2024 (20/07/2021)	Intercos ordinary shares	150,000 potentially attributable (1)	17/11/ 2021		15.84	2022-2024
Ludovica Arabella Ferrari	Executive Director	LTI 2022-2024 (20/07/2021)	Intercos ordinary shares	36,000 potentially attributable (1)	17/11/ 2021		15.84	2022-2024
Gianandrea Ferrari	Executive Director	LTI 2022-2024 (20/07/2021)	Intercos ordinary shares	24,000 potentially attributable (1)	17/11/ 2021		15.84	2022-2024
Senior Executives (5)	AGGREGATE FORM	LTI 2022-2024 (20/07/2021)	Intercos ordinary shares	144,000 potentially attributable (1)	17/11/ 2021		15.84	2022-2024
Other managers (20)	AGGREGATE FORM	LTI 2022-2024 (20/07/2021)	Intercos ordinary shares	231,000 potentially attributable (1)	17/11/ 2021		15.84	2022-2024

(1) maximum number of shares potentially attributable at the end of the vesting period (01/01/2022-31/12/2024) subject to the achievement of the targets at the end of the three-year period and the terms and conditions set out in the plan.

NOTES

INTERCOS GROUP