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Allianz Annual Report 2012

Annual Report 2012    Allianz Group Miscellaneous Internal and external Board appointments When a member of the Board of Management holds an ap- pointment in another company within the ­Allianz Group, the full remuneration amount is transferred to ­Allianz SE. In recognition of the benefits to the organization, Board of Managementmembersaresupportediftheyacceptalimited number of non-executive supervisory roles in appropriate external organizations. In these cases, 50 % of the remuner­ ation received is paid to ­Allianz SE. A Board member retains the full remuneration only when the Supervisory Board qualifies the appointment as a personal one. Remunera- tion paid by external organizations is shown in the Annual Reports of the companies concerned. The remuneration relating to the external appointment is set by the governing body of the relevant organization. Outlook for 2013 On 12 December2012 the Supervisory Board agreed the new targets. The fundamental structure used in 2012 and set out in the target setting table was validated as highly sound and will continue to form the basis of our 2013 remunera- tion structure, with the following adaptations: −− For the divisional targets, a new split was introduced: 10 % annual IFRS operating profit, 10 % IFRS net income and 5 % dividend distribution. −− The Mid-term bonus1 (MTB) 2013 – 2015 will provide an even stronger focus on sustainability. The sustainability assessment includes: −− adjusted capital growth vs. plan development −− balance sheet strength −− comparison with peers −−“partner of choice” for stakeholders −− extraordinary events 1 Mid-term bonus is the former Three-year bonus. Termination of Service – details of the payment arrangements and illustrative examples B 013 Examples in € thou Transition payment (Appointment before 1 January 2010) Board members receiving a transition payment are subject to a six months non-compete clause. A regular Board member with last Base salary of 700 and target variable remuneration of 2,100 The payment is calculated based on the last Base salary and 25 % of the target variable remuneration at the date when notice is given. Base Salary for 6 months (350) + 25 % of the total variable remuneration at target (525) = 875 An ­Allianz pension, where immediately payable, is taken into account in adjusting transition payment amounts. Severance payment cap Payments to Board members for early termination with a remaining term of contract of more than two years are capped at two year’s compensation: A regular Board member with last year Base salary of 700 and target variable remuneration of 2,100 Whereby the annual compensation Two years compensation: a. is calculated on the basis of the previous year’s annual Base salary plus 50 % of the target variable remuneration (Annual bonus + annualized Three-year bonus + Equity-related remuneration); and Base Salary (1,400) + 50 % of the total variable remuneration at target (2,100) = 3,500 Severance payment cap: the lower of 3,500 or 5,600b. shall not exceed the latest year’s actual total compensation. Assumption: Last year’s actual total compensation at 2,800 = 5,600 In case the remaining term of contract is less than two years the payment is prorated according to the remaining term of the contract. Based on the example from above (severance payment cap at 3,500) and assuming a remaining term of contract of only half a year: Severance payment cap (3,500) prorated to half a year = 875 Change of Control In case of an early termination as a result of a change of control, severance payments made to Board members generally amount to a three years' compensation (yearly compensation as defined above) and shall not exceed Based on the example from above: 150 % of the severance payment cap. 150 % of the severance payment cap (3,500) = 5,250 Consequently, the payout is less than two years total remune­ration at target. 84

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