Apator S A : Remuneration report for 2023

Report on remuneration of the

Members of the Management

Board and the Supervisory

Board of Apator SA for 2023

Toruń, 28 May 2024

on behalf of the Supervisory Board of Apator SA

_____________________________

Chairperson of the Supervisory

Board

Janusz Niedźwiecki

Table of Contents
1.	Introduction	3
2.	Remuneration of the Members of the Supervisory Board	3
3.	Remuneration of the Members of the Management Board	5

4. An explanation of how the total remuneration complies with the adopted Remuneration Policy, including how it

	contributes to the long-term performance of the Company	8
4.1.	Bonus objectives for 2023	9
5.	Changes in remuneration and basic results of the Apator Group from 2018 - 2023	10

Name of the organisational unit:		Apator SA
Period covered by the report:	1 January 2023 - 31	Reporting currency:	Polish zloty (PLN)
December 2023
Rounding level:	Whole numbers, no decimal places

Page 2 of 12

1. Introduction

The report on remuneration of the Members of the Management Board and the Supervisory Board of Apator SA has been prepared in accordance with the requirements of the Act of 29th July 2005 on Public Offering, the Conditions Governing the Introduction of Financial Instruments to Organised Trading, and Public Companies (consolidated text Dz. U. /Journal of Laws/ of 2022, item 2554, hereinafter referred to as the Act on Public Offering) and it includes the description of remuneration paid to the Members of the Management Board and the Supervisory Board in accordance with binding internal regulations including "Remuneration Policy of the Members of the Management Board and the Supervisory Board of Apator S.A." adopted by the Ordinary General Shareholders Meeting of Apator S.A. on 2 July 2020, and amended by the resolution of the Ordinary General Shareholders Meeting on 28 June 2023.

The Company did not apply any derogations from the Remuneration Policy, derogations from its temporal application or derogations from the procedure for implementing the Policy.

On 28 June 2023, the Ordinary General Shareholders Meeting of Apator SA adopted the Resolution No. 9/VI/2023 on the positive opinion on the Report of the Supervisory Board of Apator SA on the remuneration of the Members of the Management Board and the Supervisory Board of Apator SA for 2022.

2. Remuneration of the Members of the Supervisory Board

Members of the Supervisory Board receive remuneration in the form of a fixed monthly amount determined by resolution of the General Shareholders Meeting, irrespective of their participation in meetings of the Supervisory Board, and may benefit from additional non-monetary benefits provided for employees of the Company, in accordance with the internal documents in force in the Company.

As at 31 December 2023, in Apator SA the principles of remuneration of the Supervisory Board were in force resulting from "Remuneration Policy of the Members of the Management Board and Supervisory Board of Apator SA" adopted by the Resolution of General Shareholders Meeting No. 29/VII/2020 of 2 July 2020 and amended by the Resolution of the Ordinary General Shareholders Meeting on 28 June 2023. The amount of remuneration of the Members of the Supervisory Board was adopted by the Resolution of the General Shareholders Meeting No. 30/VII/2020 of 2 July 2020.

As of 2020, the level of remuneration of the Members of the Supervisory Board on the basis of Resolution No. 30/VII/2020 adopted by the General Shareholders Meeting shall be applicable and shall amount to:

• for the Chairperson of the Supervisory Board - PLN 8,500 gross per month,
• for others Member of the Supervisory Board - PLN 7,000 gross per month,
• allowance for performing functions in committees of the Supervisory Board - PLN 1,500 gross per month.

Remuneration of the Members of the Supervisory Board:

Fixed	A Member of the Supervisory Board receives remuneration in the form of a fixed monthly
remuneration	amount determined by resolution of the General Shareholders Meeting, irrespective of
	attendance at meetings of the Supervisory Board. The remuneration of the Members of the
	Supervisory Board is paid on the same date as the remuneration of the Company's
	employees.
Variable	Members of the Supervisory Board do not receive additional remuneration in the form of a
remuneration	bonus.

Name of the organisational unit:		Apator SA
Period covered by the report:	1 January 2023 - 31	Reporting currency:	Polish zloty (PLN)
December 2023
Rounding level:	Whole numbers, no decimal places

Page 3 of 12

Additional Each Member of the Supervisory Board may receive additional non-cash benefits from the

non-cash Company, under the principles applicable to the Company's employees, such as:

benefits • co-financing of benefits available to the Company's employees (multisport card and medical package, additional life and motor insurance),

• ECP,

The Company does not offer additional pension schemes and does not grant remuneration to the Members of the Supervisory Board in the form of financial instruments.

Members of the Supervisory Board, pursuant to Article 392, sec. 3 of the Code of Commercial Companies are entitled to the reimbursement of expenses (e.g. business trips) related to the performance of their duties.

Supervisory Board of Apator SA in 2023

	First and last name		Function		Term of office in the reporting
			year
			Chairperson of the Supervisory Board, independent
	Janusz Niedźwiecki		pursuant to the "Best Practice for GPW Listed		Full year
			Companies 2021"
	Mariusz Lewicki		Deputy Chairperson of the Supervisory Board		Full year
	Danuta Guzowska		Member of the Supervisory Board		Full year
	Janusz Marzygliński		Member of the Supervisory Board		Full year
			Member of the Supervisory Board, independent
	Marcin Murawski		pursuant to the "Best Practice for GPW Listed		Full year
			Companies 2021"
	Kazimierz Piotrowski		Member of the Supervisory Board		Full year
	Tadeusz Sosgórnik		Member of the Supervisory Board		Full year

Total remuneration of the Members of the Supervisory Board for 2023 (PLN gross):

		Fixed		Additional	Total		Remuneration from
	First and last name	remuneration		benefits from	remuneration		other entities in the
		from Apator SA		Apator SA*	from Apator SA		Apator Group***
	Janusz Niedźwiecki
	Chairperson of the	102,000		-	102,000		24,000
	Supervisory Board
	Danuta Guzowska
	Member of the	84,000		-	84,000		0
	Supervisory Board
	Mariusz Lewicki
	Deputy Chairperson of the	102,000		1,500	103,500		108,000
	Supervisory Board
	Janusz Marzygliński
	Member of the	84,000		-	84,000		24,000
	Supervisory Board
	Marcin Murawski
	Member of the	102,000		1,500	103,500		0
	Supervisory Board
	Kazimierz Piotrowski
	Member of the	102,000		-	102,000		72,000
	Supervisory Board

Total

remuneration

from the Apator

Group

126,000

84,000

211,500

108,000

103,500

174,000

Name of the organisational unit:		Apator SA
Period covered by the report:	1 January 2023 - 31	Reporting currency:	Polish zloty (PLN)
December 2023
Rounding level:	Whole numbers, no decimal places

Page 4 of 12

Fixed

Additional

Total

Remuneration from

Total

remuneration

First and last name

remuneration

benefits from

remuneration

other entities in the

from the Apator

from Apator SA

Apator SA*

from Apator SA

Apator Group***

Group

Tadeusz Sosgórnik

Member of the

84,000

1,000

85,000

204,800

289,800

Supervisory Board

Conclusions

660,000

4,000

664,000

432,800

1,096,800

* Additional benefits may include: medical benefits, sports packages, ECP contributions, reimbursement of business travel expenses.

**Tadeusz Sosgórnik received from Apator Mining Sp. z o.o. basic remuneration and additional benefits in relation to the performance of the function of Commercial Director and remuneration for the performance of the function of a Member of the Supervisory Board in companies of the Apator Group. Other persons received remuneration only for performing the function of a Member of the Supervisory Board in companies of the Apator Group.

In 2023, Members of the Supervisory Board of Apator SA also performed functions in the bodies of the companies of the Apator Group, which involves receiving remuneration from those companies:

• Janusz Niedźwiecki - Member of the Supervisory Board of Apator Telemetria Sp. z o.o.,
• Mariusz Lewicki - Chairperson of the Supervisory Board of Apator Metrix S.A., Chairperson of the Supervisory Board of Apator Mining Sp. z o.o., Member of the Supervisory Board of Apator Powogaz S.A.,
• Janusz Marzygliński - Chairperson of the Supervisory Board of Apator Rector Sp. z o.o.,
• Kazimierz Piotrowski - Deputy Chairperson of the Supervisory Board of Apator Metrix S.A., Member of the Supervisory Board of Apator Mining Sp. z o.o.,
• Tadeusz Sosgórnik - Sosgórnik - Chairperson of the Supervisory Board of Apator Powogaz S.A., Chairperson of the Supervisory Board of FAP Pafal S.A., Commercial Director of Apator Mining Sp. z o.o.

The immediate family of the Members of the Supervisory Board did not receive any cash or non-cash benefits in 2023.

3. Remuneration of the Members of the Management Board

As at 31 December 2023, in Apator SA the principles of remuneration of the Members of the Management Board were in force resulting from "Remuneration Policy for the Members of the Management Board and Supervisory Board of Apator SA" adopted by the Resolution of General Shareholders Meeting No. 29/VII/2020 of 2 July 2020 and amended by the Resolution No. 24/VI/2023 of 28 June 2023, "Bonus Policy for the Members of the Management Board of Apator SA" adopted by the Resolution of Supervisory Board No. 47/2020 of 3 November 2020 and individual conditions of remuneration included in contracts of employment.

The basis for establishing a legal relationship with a Member of the Management Board and paying their remuneration is:

1. an employment contract concluded for a limited or indefinite period, or
2. a contract of mandate (management contract) concluded for the duration of holding the position of a Member of the Management Board, or
3. appointment to perform the function of a Member of the Management Board for the term of office of the Member of the Management Board,
4. a civil law contract concluded with an entity cooperating with or employing a Member of the Management Board, or
5. another legally permissible form of cooperation.

The choice of the basis for establishing a legal relationship with the Member of the Management Board and the determination of their remuneration shall be determined through negotiations between the parties. These negotiations shall be conducted on behalf of the Company by the Supervisory Board or a proxy appointed by it from among the Members of the Supervisory Board.

Name of the organisational unit:		Apator SA
Period covered by the report:	1 January 2023 - 31	Reporting currency:	Polish zloty (PLN)
December 2023
Rounding level:	Whole numbers, no decimal places

Page 5 of 12

The final decision on the establishment of a legal relationship with a Member of the Management Board, its basis, the rights and obligations of the parties with regard to, inter alia, the termination of the legal relationship, as well as the principles of remuneration, are determined by the Supervisory Board of the Company in the form of a resolution to which a draft contract concluded with the Member of the Management Board is attached.

The Supervisory Board may establish different bases for the legal relationship for individual Members of the Management Board, and may also establish different rates of remuneration for individual Members of the Management Board for the management of the Company and direct management of the Organisational Division, but regardless of this, the principles for dividing the remuneration of a given Member of the Management Board into fixed remuneration and variable remuneration must remain the same, regardless of the basis of the legal relationship applied.

Irrespective of the basis applied for establishing legal relationship with the Member of the Management Board, the Member of the Management Board may receive from the Company a remuneration in cash for managing the Company consisting of two parts, i.e. the fixed and variable remuneration.

When appointing a Member of the Management Board, the Supervisory Board shall determine - in a resolution appointing the Member of the Management Board or in a separate resolution - the basic elements of the remuneration in cash of the Member of the Management Board, including the amount of fixed and variable remuneration.

A Member of the Management Board may also be granted additional benefits under the rules applicable to the Company's employees.

Components of the remuneration of a Member of the Management Board:

Fixed	Fixed remuneration is paid monthly in the amount set out in a resolution of the Board, on the
remuneration	date of payment of the remuneration to the Company's employees. The amount of fixed
	remuneration is determined by the Supervisory Board, taking into account the expectations
	of the Member of the Management Board, the company's achieved profit level and
	remuneration benchmarks.
Variable	Variable remuneration represents up to 80% of fixed remuneration and is paid in the form of
remuneration	an annual bonus on the date following the approval of the Company's financial statements
	by the General Shareholders Meeting.
	The payment of the annual bonus depends on the achievement of certain long-term
	management objectives by the individual Members of the Management Board and on the
	performance of the Company/Apator Group. The management objectives are primarily
	financial and non-financial indicators. The level of performance of the objectives is the basis
	for granting the annual bonus to the Management Board of Apator S.A.
Additional	Each Member of the Management Board may also receive additional non-cash benefits from
non-cash	the Company, under the principles applicable to the Company's employees, such as:
benefits	• contribution to the costs of renting an apartment,
	• co-financing of benefits available to the Company's employees (e.g. multisport card and
	medical package, additional life and motor insurance),
	• ECP,
	• company car for private use.
	The Company does not offer additional pension schemes and does not grant remuneration
	in the form of financial instruments.

Name of the organisational unit:		Apator SA
Period covered by the report:	1 January 2023 - 31	Reporting currency:	Polish zloty (PLN)
December 2023
Rounding level:	Whole numbers, no decimal places

Page 6 of 12

Management Board of Apator SA in 2023:

	First and last name		Function		Term of office in the reporting year
	Arkadiusz Chmielewski		President of the Management Board - Business		1 January 2023 - 28 February 2023
		Development Director of the Apator Group
	Tomasz Łątka		Member of the Management Board - General		1 January 2023 - 27 September 2023
		Director
	Maciej Wyczesany		President of the Management Board - General		1 March 2023 - 31 December 2023
		Director
	Łukasz Zaworski		Member of the Management Board - Product		22 November 2023 - 31 December 2023
		Development Director
	Robert Kowalski*		Member of the Management Board - Strategy		19 December 2023 - 31 December 2023
		Director of the Apator Group

• Robert Kowalski resigned from the post of the Member of the Management Board of Apator SA effective 14 May 2024 due to his appointment to the Management Board of a State-Owned Enterprise

Total remuneration of the Members of the Management Board for 2023 (PLN gross):

		Fixed		Remunerati
		remunerati		on from
		on		other titles
		from Apator		(sick pay,
		SA		holiday
				Variable
		(employme		pay,			Additiona		Total
				remune
		nt contract,		inventions,			l benefits		remuneratio
				ration
First and last		appointmen		severance			from		n
			from
name		t to the		pay,			Apator		from Apator
			Apator
		Manageme		compensati			SA		SA
				SA*
		nt Board,		on)

contract for

the

provision of

services)

Share of		Remunerati		Total
variable		on from		remuneratio
remunerati		other		n
on in total		entities in		from the
remunerati		the Apator		Apator
on		Group***		Group

Arkadiusz
Chmielewski	130,000	785,400	-	800	916,200	0%	10,000	983,200
President of the
Management
Board
Tomasz Łątka
Member of the	586,200	379,600	-	9,200	975,000	0%	18,000	993,000
Management
Board
Maciej
Wyczesany
President of the	650,000	-		344,565	52,300	1,046,865			40,200	1,087,065
Management							33%
Board
Łukasz
Zaworski
Member of the	54,000	-		-	553	54,553	0%	42,000	96,600
Management
Board
Robert
Kowalski	18,400	-		-	900	19,300	0%	-	19,300
Member of the
Management
Board
Conclusions
Name of the organisational unit:					Apator SA
Period covered by the report:		1 January 2023 - 31		Reporting currency:		Polish zloty (PLN)
	December 2023
Rounding level:			Whole numbers, no decimal places

Page 7 of 12

*The amount of the bonus due for 2023 approved by the Supervisory Board on 28 May 2024 based on the level of fulfilment of financial and non-financial objectives by individual Members of the Management Board. The bonus shall be paid upon approval of the financial statements by the General Shareholders Meeting. A bonus for 2022 was paid in 2023 in the amount of: Arkadiusz Chmielewski PLN 75,093; Tomasz Łątka PLN 111,660.

• Arkadiusz Chmielewski received fixed remuneration for acting as the Member of Supervisory Board of Apator Powogaz; Tomasz Łątka received fixed remuneration for acting as the Member of Supervisory Board of Apator Rector; Maciej Wyczesany received fixed remuneration for acting as the Member of
  Supervisory Board of Apator Powogaz and Apator Rector; Łukasz Zaworski received fixed remuneration for acting as the Member of Supervisory Board of Apator Metrix and Apator Rector

4. An explanation of how the total remuneration complies with the adopted Remuneration Policy, including how it contributes to the long-term performance of the Company

Under the Remuneration Policy, the total remuneration structure is in line with market practices, while remuneration levels are in line with those offered in the sector of industrial companies listed on the WSE, taking into account the scale of operations.

The amount of remuneration shall be reviewed once a year. The criteria affecting the nature and amount of fixed and variable remuneration awarded to the Members of the Management Board have been defined in such a way as to support the achievement of the Company's business strategy, long-term interests and stability, in particular by:

• setting bonus objectives for the Members of the Management Board annually in accordance with financial and strategic plans of the Company and the Apator Group and then assessing the level of their performance,
• concluding non-competition and confidentiality agreements with Members of the Management Board in order to protect the interests of the Company.

The objective of the Remuneration Policy is to ensure the development of the Company and the entire Apator Group, securing the stakeholders, in particular customers, owners and employees, inter alia, through adequate, market-based remuneration of the employees, for the work performed and motivating them to achieve the best possible results based on specified quantitative and qualitative criteria.

Each Member of the Company's Management Board may receive variable remuneration. Variable remuneration represents up to 80% of the fixed remuneration and is paid in the form of an annual bonus. A condition for receiving the bonus is the achievement of the financial and non-financial objectives determined by the Board, with the threshold for triggering the settlement of financial objectives being 90% achievement of these objectives.

Members of the Management Board receive both financial and non-financial objectives in a proportion of 80/20 respectively. The management objectives determining the amount of variable remuneration may include:

• financial objectives:
• • income level
  • EBITDA level
  • net and gross profit level
  • revenue value and trend
  • other financial indicators
• non-financialobjectives:
• • implementing the Company's and Group's business strategy
  • increasing business efficiency
  • actively seeking business development opportunities
  • active cooperation within the Group
  • customer satisfaction level

Name of the organisational unit:		Apator SA
Period covered by the report:	1 January 2023 - 31	Reporting currency:	Polish zloty (PLN)
December 2023
Rounding level:	Whole numbers, no decimal places

Page 8 of 12

• implementing the HR strategy
• implementing the CSR strategy
• environmental indicators

Awarding bonuses to the Members of the Management Board is based on an assessment of the achievement of the set objectives.

In accordance with point 4.6 of the adopted "Remuneration Policy", the Company did not defer the payment of variable remuneration and did not request its return.

4.1. Bonus objectives for 2023

In accordance with the adopted Remuneration Policy for Members of the Management Board and Supervisory Board approved by Resolution of the Ordinary General Shareholders Meeting No. 29/VII/2020 and amended by Resolution of the Ordinary General Shareholders Meeting No. 24/VI/2023 and the Bonus Regulations, the Supervisory Board set financial and non-financial objectives for the Members of the Management Board for 2023 in the proportion of 80/20 respectively, and assigned bonus thresholds and weights to them. No bonus objectives were set for those appointed to the Management Board in the last quarter of 2023.

The payment of the variable remuneration (bonus) occurs upon the Supervisory Board's assessment of the performance of the set objectives in the form of a resolution and upon the approval of the Company's financial statements by the General Shareholders Meeting scheduled for 26 June 2024.

Name of the organisational unit:		Apator SA
Period covered by the report:	1 January 2023 - 31	Reporting currency:	Polish zloty (PLN)
December 2023
Rounding level:	Whole numbers, no decimal places

Page 9 of 12

5. Changes in remuneration and basic results of the Apator Group from 2018

• 2023

The table below shows the changes in total remuneration* and basic results of the Apator Group from 2018-2023.

Year on Year

Maciej Wyczesany

President of the

Management Board

since 1 March 2023

Łukasz Zaworski

Member of the

Management Board

since 22 November

2023

Robert Kowalski

Member of the

Management Board

since 19 December

2023

Mirosław Klepacki

President of the

Management Board

from 16 November 2017

to 24 November 2021

Arkadiusz

Chmielewski Member

of the Management Board since 12 June 2017 to 30 November 2017 and since 1 January 2019 to 24 November 2021. President of the Management Board

																			2019 vs			2020 vs			2021 vs			2022 vs			2023 vs
	2018			2019			2020			2021			2022			2023
													2018			2019			2020			2021			2022
-		-		-		-		-		1,046,865		-		-		-		-		100%
-		-		-		-		-		54,553		-		-		-		-		100%
-		-		-		-					19,300		-		-		-		-		100%-
1,088,324		1,207,938		1,310,744		1,077,316	-		-		11.0%		8.5%		- 17.8%		-		-
-		384,000		416,736		412,080	858,241		916,200		-		8.5%		-1.1 %		108.3%		7%

Name of the organisational unit:		Apator SA
Period covered by the report:	1 January 2023 - 31	Reporting currency:	Polish zloty (PLN)
December 2023
Rounding level:	Whole numbers, no decimal places

Page 10 of 12