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DES GB 11 Finanzbericht englisch

REMuNERATION REPORT With respect to the Gesetz zur Angemessenheit der Vorstandsvergü- tung (VorstAG – German Act on the Appropriateness of Executive Board Remuneration) enacted in 2009 and changes to the Corporate Governance Code, the existing remuneration rules were reviewed by the Supervisory Board in April 2010 and amended in line with legal requirements to take effect in the 2010 financial year. rEmunEration systEm For thE ExEcutivE Board Remuneration for the Executive Board is set by the Supervisory Board. The remuneration system provides for a non-performance- related basic annual remuneration component based on the individual Executive Board member’s duties, a performance-related remunera- tion component, and non-cash benefits in the form of a company car and contributions to a pension scheme. The bonus as a performance-related remuneration component is dependent on sustained company development. It is based on the weighted average over the financial year and the two previous finan- cial years. The basis for calculating the bonus includes 60% of Group EBT (excluding measurement gains/losses) for the financial year just ended, 30% of that of the previous financial year and 10% of that of the financial year before that. Mr Böge receives 0.5% of the calcula- tion basis as a bonus and Mr Borkers receives 0.2%. The bonus is limited to 150% of the basic annual remuneration. The non-performance-related basic annual remuneration is € 300,000 for Mr Böge and € 168,000 for Mr Borkers. For the 2011 financial year, there is an additional bonus entitlement of € 374,000 for Mr Böge and € 149,000 for Mr Borkers, which will be paid on approval of the consolidated financial statements by the Supervisory Board. If the results of operations and net assets of the Company deteriorate during the term of the respective employment contracts to such an extent that further payment of this remuneration becomes unreason- able, the rules of section 87 (2) of the AktG shall apply. The Supervi- sory Board shall decide at its own discretion on the extent to which such remuneration shall be reduced. In the event that the employment contract is terminated prematurely by the Company without any good cause, the members of the Execu- tive Board shall be entitled to a settlement in the amount of the annual remuneration outstanding up to the end of the agreed contractual term, but limited to a maximum of two annual remuneration amounts (basic annual remuneration plus bonus). For the measurement of the annual remuneration amount, the average annual remuneration for the previous financial year and the probable annual remuneration for the current financial year shall be applicable. A long-term incentive (LTI) remuneration component was agreed for the first time in 2010. The amount of the LTI is based on changes in the market capitalisation of Deutsche EuroShop AG between 1 July 2010 and 30 July 2015. Market capitalisation is calculated by multi- plying the share price by the number of Company shares issued. On1 July 2010, according to information provided by the German stock exchange, market capitalisation stood at € 983.5 million. If there is a positive change in market capitalisation over the above five-year period of up to € 500 million, Mr Böge will receive 0.2% and Mr Borkers 0.025% of the change. For any change over and above this amount, Mr Böge will receive 0.1% and Mr Borkers 0.0125%. The LTI will be paid out to Mr Borkers in December 2015, and to Mr Böge in five equal annual instalments, the first being paid on 1 January 2016. In the event that the employment contract is termi- nated prematurely by the Company, any entitlements arising from the LTI until that date will be paid out prematurely. Since 1 July 2010, the market capitalisation of the Company rose to € 1,280.5 million by 31 December 2011 (31 December 2010: € 1,496.3 million) and was thus € 297 million higher than at 1 July 2010 (31 December 2010: € 512.8 million). The present value of the potential entitlement to the long-term incentive arising therefrom was € 609 thousand at year-end (31 December 2010: € 960 thousand). In the year under review, the sum of € 96,000 was added to the provision established for this purpose (2010: € 85,000). rEmunEration oF thE ExEcutivE Board in 2011 The remuneration of the Executive Board totalled € 1,066,000, which breaks down as follows: € thousand non-perfor- mance-related remuneration performance- related remuneration ancillary benefits Total total previous year Claus-Matthias Böge 300 374 65 739 803 Olaf Borkers 168 149 10 327 351 468 523 75 1,066 1,154 6 DES Annual Report 2011 GRoup MAnAGeMent RepoRt business and economic conditions