IRCE

Remuneration Information • Mar 24, 2017

REMUNERATION REPORT in compliance with articles 123 - ter of the Consolidated Financial Act and 84 – quarter of the Issuers' Regulations

Report Approval Date: 15 March 2017 Year to which the Report refers: 2016

Website: www.irce.it

This Report is drafted in compliance with articles 123 – ter of the Consolidated Financial Act (Italian Legislative Decree No. 58 of 24 February 1998) and 84 – quater of the Issuers' Regulations (Consob Regulations 11971 of 14/05/1999), on the basis of Scheme 7 – bis of Annex 3A of the same Regulations.

This Report defines the criteria and guidelines for the remuneration of members of the Board of Directors, including the Executive Directors and the Directors holding special offices and the members of the Board of Statutory Auditors.

The remuneration policy has been approved by the Company's Board of Directors, upon proposal submitted by the Remuneration Committee, and submitted to the Shareholders' Meeting held to approve the financial Statements.

SECTION I

The Company's Board of Directors has established its own Remuneration Committee with resolution of 28/04/2016, which will remain in office until approval of the 2018 financial statements.

The Remuneration Committee is composed of three non-executive Directors appointed by the Board of Directors, the majority of whom are independent: Ms Francesca Pischedda independent director and Chairwoman of the Committee, Mr Gianfranco Sepriano, non-executive director and Mr Orfeo Dallago independent director.

At least one member of the Remuneration Committee has know-how and experience in accounting and finance and/or remuneration policies which were deemed adequate by the Board at the time of appointment.

The Committee's work is coordinated by a Chairman, Ms Francesca Pischedda, and minutes of the meetings are regularly taken.

During the financial year one meeting was held lasting one hour which was attended by all the Committee members.

One meetings are scheduled for the current financial year.

The Chairman of the Board of Statutory Auditors attended the discussions of the Remuneration Committee.

The Remuneration Committee:

• presents to the Board of Directors proposals for setting-up the general policy for the remuneration of executive directors, directors holding special offices and key management personnel;
• carries out a periodic assessment of the adequacy, overall coherence and actual implementation of the general policy adopted for the remuneration of the executive Directors, the other directors holding special offices and the key management personnel, using for this last task information provided by the managing directors, and formulates the relevant proposals;
• presents to the Board of Directors proposals concerning the remuneration of the executive directors and the other directors holding special offices and also establishes the performance objectives related to the variable component of such remuneration, monitors

the implementation of decisions adopted by the Board itself in particular verifying the actual achievement of the performance objectives.

In carrying out its functions, the Remuneration Committee was able to access the company information and functions necessary for carrying out its duties without the need to use an external consultant.

The Board of Directors defined a remuneration policy for directors and key management personnel.

Remuneration policy for the Board of Directors

The remuneration policy of executive directors or directors holding special offices defines guidelines with reference to the topics and in line with the criteria indicated below:

• a) The fixed component and the variable component are sufficiently balanced according to the strategic objectives and the risk management policy of the Company, also bearing in mind the industry in which it operates and the characteristics of the business activity actually carried out;
• b) Maximum limits are envisaged for the variable components;
• c) The fixed component is determined in an amount sufficient to remunerate the services performed by the director if the variable component should not be paid due to failure to achieve the performance objectives specified by the Board of Directors;
• d) The performance objectives are pre-established, measurable and linked to the creation of value for shareholders over a medium-long timescale;
• e) The payment of a significant portion of the remuneration variable component is deferred over an adequate period of time with respect to the time it is accrued; the extent of this portion and the duration of the deferment are in line with the characteristics of the business activity carried out and with the related risk profiles;
• f) Contractual agreements allowing the company to ask for the total or partial repayment of the variable components of the remuneration paid out (or to deduct the sums involved in the deferment), established on the basis of figures that turned out to be grossly wrong at a later date, are not envisaged;
• g) No indemnities are envisaged for the early termination of the directorship relationship or for its non-renewal;
• h) Share-based compensation plans are not envisaged.

The remuneration of non-executive directors is not linked to the economic results achieved by the Company.

Non-executive directors are not recipients of share-based incentive plans.

Agreements have not been entered into between the Company and the directors that provide for indemnities in the event of resignation or dismissal/repeal without just cause or if the relationship terminates due to a take-over bid.

SECTION II

PART ONE

Compensation of members of the Administration and Control Bodies

Compensation for the administrative Body was resolved by the shareholders' meeting on 28/04/2016.

In particular, the shareholders' meeting resolved to award an annual compensation to each board member of € 12,000.00.

In the session of 28/04/2016, the Board also awarded to the Chairman of the Board of Directors, on the basis of the office assigned and that provided by art. 2389, paragraph 3 of the Italian Civil Code, a compensation of € 142,542.10 on an annual basis, gross of any withholding amounts foreseen by law and for the whole duration of the office (31/12/2018).

Such compensation will remain unchanged until any modification resolution.

Moreover, for the three-year period 2016 – 2018 a variable remuneration will be paid to Executive Directors only.

The remuneration for directors and key management personnel is set up in order to align their interests with the pursuit of the company's primary objective, i.e. the creation of value for shareholders, also in the medium term.

The total remuneration of executive directors and key management personnel comprises:

• a fix remuneration;
• a short-term variable remuneration based on the achievement of predefined objectives, measured annually, on the basis of an economic-financial index;
• a medium-term variable remuneration tied to the achievement of objectives, measured on the basis of an economic-financial index, over a three-year period (equal to the Board's term of office).

As for the medium-term variable remuneration, the assessment regarding achievement of objectives will be carried out on an annual basis, but it will be paid only if the progressive average of the results for the three-year period is in line with the objectives.

The directors' remuneration for FY 2016 did not benefit from variable components since the above-mentioned predefined objectives were not achieved.

The compensation of the Board of Statutory Auditors were resolved by the shareholders' meeting of 28/04/2014, which approved the following:

• To the Chairman of the Board of Statutory Auditors, an annual amount of € 30,000.00 for fees, indemnity and expenses (including general practice expenses);
• To each Standing Statutory Auditor, an annual amount of € 20,000.00 for fees, indemnity and expenses (including general practice expenses);
• An attendance fee, including travel expenses, equal to € 500.00 for every day spent attending the meetings of the Board of Statutory Auditors, the Board of Directors and the Shareholders' Meeting up to a maximum number of 9 attendance fees per year.

Incentive plans based on financial instruments for board members or for members of the control body are not envisaged.

This Report will be made available, within the deadlines envisaged under currently effective regulations, at the registered office of the Company as well as at Borsa Italiana S.p.A. and on the website www.irce.it

On behalf of the Board of Directors

PART TWO

• a) Table of compensation paid to the administration and control bodies;
• b) Table of equity investments held by members of the administration and control bodies.

a) TABLE OF COMPENSATION PAID TO THE ADMINISTRATION AND CONTROL BODIES

A Nam d Su e an rnam e	B Offic e	C Perio h the o d du ring whic ffice held was	D Expir y da te of offic e	1 Fixed ation com pens	2 ation Com pens for a ing Com ttend mitte es	3 Varia ble n quity ation on-e com pens		4 Non neta -mo ry bene fits	5 Othe ation r com pens	6 Tota l	7 Fair v alue of equi ty	8 End of of fice or inati f term on o work ing
						Bonu s and othe r ince ntive s	Prof it-sh aring				ation com pens	relat ions hip inde mnit y
Filipp o Ca sadio (I) Co nsati on in the that draf ts th e fin ancia l stat nts mpe com pany eme (II) C from subs idiary and d co tion ciate nies omp ensa asso mpa	Chai of th e Bo ard o f Dire ctors rman	201 6-20 18	2018	257,5 29.9 1	- - -	0.00 25,00 -	- -	140.6 4 -	-	282, 670. 55 -		- - - -
(III) T otal				257,5 29.9 1	-	0.00 25,00	-	4 140.6	-	282, 670. 55		- -
Fran o Ga ndol fi Co lleon i cesc (I) Co the that draf ts th e fin l stat nsati on in ancia nts mpe com pany eme (II) C tion from subs idiary and ciate d co nies omp ensa asso mpa	Direc tor	2016 -201 8	2018	128,1 28.3 6	- -	0.00 25,00 -	- -	7,97 1.28 -		161, 099. 64 -		- -
(III) T otal				128,1 28.3 6	- -	0.00 25,00	-	1.28 7,97	- -	161, 099. 64		- - - -
Gian franc prian o Se o (I) Co nsati on in the that draf ts th e fin ancia l stat nts mpe com pany eme (II) C tion from subs idiary and ciate d co nies omp ensa asso mpa	Direc tor	2016 -201 8	2018	12,00 0.00	- - -	- -	- -	- -	70,00 0.00 -	82,0 00.0 -	0	- - - -
(III) T otal				12,00 0.00	-	-	-	-	70,00 0.00	82,0 00.0	0	- -
Orfe llago o Da (I) Co nsati on in the that draf ts th e fin ancia l stat nts mpe com pany eme	Direc tor	2016 -201 8	2018	12,00 0.00	-	-	-	-	-	12,0 00.0	0	- -
(II) C from subs idiary and d co tion ciate nies omp ensa asso mpa					- -	-	-	-	-	-		- -
(III) T otal				12,00 0.00	-	-	-	-	-	12,0 00.0	0	- -
Fran a Pis ched da cesc (I) Co the that draf ts th e fin l stat nsati on in ancia nts mpe com pany eme	Direc tor	2016 -201 8	2018	12,00 0.00	-	-	-	-	-	12,0 00.0	0	- -
(II) C tion from subs idiary and ciate d co nies omp ensa asso mpa					- -	-	-	-	-	-		- -
(III) T otal Gigli ola D i Chi ara (I) Co the that draf ts th e fin l stat nsati on in ancia nts mpe com pany eme	Direc tor	2016 -201 8	2018	12,00 0.00 12,00 0.00	- -	- -	- -	- -	- -	12,0 00.0 12,0 00.0	0 0	- - - -
(II) C tion from subs idiary and ciate d co nies omp ensa asso mpa					- -	-	-	-	-	-		- -
(III) T otal				12,00 0.00	-	-	-	-	-	12,0 00.0	0	- -
l Boa rd of Dire Tota ctors				433, 658. 27	-	0 50,0 00.0	-	1.92 8,11	0 70,0 00.0	19 561, 770.	-	-
Fabio Sen ese (I) Co the that draf ts th e fin l stat nsati on in ancia nts mpe com pany eme (II) C tion from subs idiary and ciate d co nies omp ensa asso mpa	Chai of th e Bo ard o f Sta ry Au ditor tuto rman s	2014 -201 6	201 6	34,50 0.00	- - -	- -	- -	- -	- -	34,5 00.0 -	0	- - - -
(III) T otal				34,50 0.00	-	-	-	-	-	34,5 00.0	0	- -
tella Dona Vita nza (I) Co nsati on in the that draf ts th e fin ancia l stat nts mpe com pany eme (II) C tion from subs idiary and ciate d co nies omp ensa asso mpa	ding Audi Stan Statu tory tor	2014 -201 6	201 6	24,00 0.00	- - -	- -	- -	- -	- -	24,0 00.0 -	0	- - - -
(III) T otal				24,00 0.00	-	-	-	-	-	24,0 00.0	0	- -
Adal berto Cost antin i	Stan ding Statu Audi tory tor	-201 6	6
(I) Co nsati on in the that draf ts th e fin ancia l stat nts mpe com pany eme (II) C from subs idiary and d co tion ciate nies omp ensa asso mpa		2014	201	24,50 0.00	- - -	- -	- -	- -	- -	24,5 00.0 -	0	- - - -
(III) T otal				24,50 0.00	-	-	-	-	-	24,5 00.0	0	- -
Tota l Boa rd of Stat Aud itors utory				83,0 00.0 0	-	-	-	-	-	0 83,0 00.0	-	-

b) TABLE OF EQUITY INVESTMENTS HELD BY MEMBERS OF THE ADMINISTRATION AND CONTROL BODIES

d Su Nam e an rna me	Offi ce	Com pan y	No. of s hare s he ld a t th d of the e en ious fina ncia l ye prev ar	No. of s hare rcha sed du ring the s pu fina ncia l ye ar	No. of sha sold du ring the res fina ncia l ye ar	No. of s hare s he ld a t th d of the e en fina ncia l ye ent curr ar
Filip po C dio asa	Cha irma n of the ard of D irec Bo tors	IRC E S. p.A.	561 ,371	-	-	561 ,371
Fran o G and olfi Coll i cesc eon	Dire ctor	IRCE S.p .A.	(*) 559 ,371	-	-	(*) 559 ,371
		IRCE S.p .A.	30,0 00	-	-	30 ,000
Gia nfra Sep rian nco o	Dire ctor	IRCE S.p .A.	3,50 0	-	-	3,50 0
Orfe o D alla go	Dire ctor	IRCE S.p .A.	587 ,267	-	-	587 ,267
sche dda Fran a Pi cesc	Dire ctor	IRCE S.p .A.	-	-	-	-
Gigl iola Di C hiar a	Dire ctor	IRCE S.p .A.	-	-	-	-
Fab io S ene se	Cha irma n of the Bo ard of S Aud itor tatu tory s	IRCE S.p .A.				-
Ada lber to C ntin i osta	ding udit Stan Sta ry A tuto or	IRCE S.p .A.				-
atel la V Don itan za	ding udit Stan Sta tuto ry A or	IRCE S.p .A.				-
(*) S hare s he ld b y hi s wi fe, C arla Cas adio