Georgia Healthcare Group PLC Annual Report 2018 Governance Remuneration Committee Report continued Performance-based remuneration – Discretionary deferred shares Purpose and link to strategy Operation Opportunity • In the context of overall Group • Performance-based remuneration is • For Mr Gamkrelidze and any other performance, to motivate and reward awarded annually entirely in the form of Executive Director, the maximum number an Executive Director in relation to his nil-cost options over GHG shares subject of discretionary deferred shares that may or her contribution to the achievement to vesting (“discretionary deferred be awarded in respect of the previous of the KPIs set for him or her by the shares”). The Company does not award work year is 150% of total salary Remuneration Committee towards cash bonuses. (i.e. cash and deferred share salary). the beginning of the work year. • The Remuneration Committee will • Performance-based remuneration solely determine annually whether an award is in the form of deferred shares (no cash merited based on the Executive Director’s bonus) in order to: achievement of the KPIs set for the work – Closely align the interests of an year and the performance of the Group Executive Director with those during that work year. If appropriate where of shareholders a strategic change or change in business – Avoid inappropriate risk taking for circumstances has made one or more of short-term gain the Executive Director’s KPIs an inaccurate – Encourage long-term commitment gauge of performance, the Remuneration to the Group Committee may decide to base its assessment on alternative measures. The outcome of an Executive Director’s performance and the Remuneration Committee’s determination will be reported in the Directors’ Remuneration Report for the work year in consideration. • Any discretionary deferred shares will be normally granted following the end of the work year, although the Remuneration Committee retains the discretion to determine the timing of the awards. Any discretionary deferred shares will vest 33.33% in each of the second, third and fourth years following the end of the work year (effectively over four years from the beginning of the work year). • Vested discretionary deferred shares must then be held for a further two years. • At vesting (upon exercise of the nil-cost options), an Executive Director receives (in addition to the discretionary deferred shares) cash payments equal to the dividends paid on the underlying shares between the date the award was made and the vesting date. • KPIs for the Executive Directors are set towards the start of each work year and reflect each Executive Director’s targeted contribution to the Group’s overall key strategic and financial objectives for the coming year. KPIs may also include non-tangible factors such as self-development, mentoring and social responsibility. • There is no contractual right to discretionary remuneration and the Remuneration Committee reserves the right to award no discretionary deferred shares if the Group’s performance is unsatisfactory. • Lapse provisions (natural malus) and extended clawback and malus applies under the circumstances as set out in the notes to this Policy table. 92