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Redefine International P.L.C. Annual Report 2017 60 With a sharper focus on risk management and mitigation, the Redefine International Board remains confident that it has the right strategy to sustain the Company through potential uncertainties ahead. Directors’ report Governance Chairman’s statement 2017 has been a year of political and economic uncertainty with a constantly changing macroeconomic backdrop. With a sharper focus on risk management and mitigation, the Redefine International Board remains confident that it has the right strategy to sustain the Company through potential uncertainties ahead, whilst continuing to provide our shareholders with market-leading income returns. During the year the Board has sought to strengthen the portfolio, through the recycling of assets with lower rental or growth potential, in favour of assets with stronger property fundamentals and longer-term growth prospects. Disposal proceeds have largely been reinvested or used to reduce gearing. Refinancing initiatives have broadly been concluded at lower levels of gearing and resulted in a reduced cost of debt and a stronger capital structure. Communication of the Company’s strategy was conveyed to shareholders at the Capital Markets Day in February, which was well attended and received. The Board’s decision to rebase the dividend to better align earnings with operating cash flow has been clearly set out and communicated. The Company has made significant progress in becoming the UK’s leading income focused REIT. On 1 December 2017, the Company will be rebranded to Real Estate Diversified Income REIT, or RDI REIT. The purpose of rebranding is to ensure the Company has a clear and independent identity as well as supporting better communication with stakeholders. Greg Clarke Chairman of the Board Through communication with its wider stakeholder base, the Company strives to improve both our buildings and the environments they provide whilst contributing where possible to communities in which we operate. We endeavour to ensure that our suppliers adhere to a strict code of ethics and undertake to pay them fairly and within agreed timeframes. We build strong relationships with our lenders and deal with them in an open and transparent manner. We encourage openness amongst our employees and listen to their concerns, while supporting them to develop their careers and work-life balance through training and transition through various stages in their lives. At the heart of our success is our culture. Both internally and externally, the Company is considered agile and experienced, hands on, proactive, efficient, personable and approachable. The personable and experienced nature of the Board and its executive has resulted in a strong leadership team. A team that is relentlessly inquisitive, seeking out new opportunities with agility enabling opportunities to be harnessed. Boardroom culture is good natured and constructive and relationships between executives and non-executives are good, although with the uncertainty of the political and economic environment, the non-executives have been increasingly challenging management to ensure that the long-term success of the Company has been properly considered. An analysis was conducted in January to record how Redefine International should react to a range of different scenarios that could be faced by the Company in the next few years. The Board evaluation conducted at year end showed that Directors wanted more time set aside to review strategy, to ensure that the current model remains fit for purpose in the constantly changing economic environment. As Chairman of the Board and Nominations Committee, I have sought to expand the experience and diversity of the Board and I am confident that the appointment of a new Non-executive Director will be announced before the end of the calendar year which will further enhance the strength of the Board. Succession planning for the executives and committee chairs will be a focus area during 2018.

Governance Chairman’s statement...with LR 6.1.2A. As a Chapter 6 Company with a controlling shareholder, Redefine International has complied with LR 9.8.4 R (14): 1. The Company

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Page 1: Governance Chairman’s statement...with LR 6.1.2A. As a Chapter 6 Company with a controlling shareholder, Redefine International has complied with LR 9.8.4 R (14): 1. The Company

Redefine International P.L.C. Annual Report 201760

With a sharper focus on risk management and mitigation, the Redefine International Board remains confident that it has the right strategy to sustain the Company through potential uncertainties ahead.

Directors’ reportGovernance

Chairman’s statement

2017 has been a year of political and economic uncertainty with a constantly changing macroeconomic backdrop. With a sharper focus on risk management and mitigation, the Redefine International Board remains confident that it has the right strategy to sustain the Company through potential uncertainties ahead, whilst continuing to provide our shareholders with market-leading income returns.

During the year the Board has sought to strengthen the portfolio, through the recycling of assets with lower rental or growth potential, in favour of assets with stronger property fundamentals and longer-term growth prospects. Disposal proceeds have largely been reinvested or used to reduce gearing. Refinancing initiatives have broadly been concluded at lower levels of gearing and resulted in a reduced cost of debt and a stronger capital structure.

Communication of the Company’s strategy was conveyed to shareholders at the Capital Markets Day in February, which was well attended and received. The Board’s decision to rebase the dividend to better align earnings with operating cash flow has been clearly set out and communicated. The Company has made significant progress in becoming the UK’s leading income focused REIT.

On 1 December 2017, the Company will be rebranded to Real Estate Diversified Income REIT, or RDI REIT. The purpose of rebranding is to ensure the Company has a clear and independent identity as well as supporting better communication with stakeholders.

Greg ClarkeChairman of the Board

Through communication with its wider stakeholder base, the Company strives to improve both our buildings and the environments they provide whilst contributing where possible to communities in which we operate. We endeavour to ensure that our suppliers adhere to a strict code of ethics and undertake to pay them fairly and within agreed timeframes. We build strong relationships with our lenders and deal with them in an open and transparent manner. We encourage openness amongst our employees and listen to their concerns, while supporting them to develop their careers and work-life balance through training and transition through various stages in their lives.

At the heart of our success is our culture. Both internally and externally, the Company is considered agile and experienced, hands on, proactive, efficient, personable and approachable. The personable and experienced nature of the Board and its executive has resulted in a strong leadership team. A team that is relentlessly inquisitive, seeking out new opportunities with agility enabling opportunities to be harnessed. Boardroom culture is good natured and constructive and relationships between executives and non-executives are good, although with the uncertainty of the political and economic environment, the non-executives have been increasingly challenging management to ensure that the long-term success of the Company has been properly considered. An analysis was conducted in January to record how Redefine International should react to a range of different scenarios that could be faced by the Company in the next few years. The Board evaluation conducted at year end showed that Directors wanted more time set aside to review strategy, to ensure that the current model remains fit for purpose in the constantly changing economic environment.

As Chairman of the Board and Nominations Committee, I have sought to expand the experience and diversity of the Board and I am confident that the appointment of a new Non-executive Director will be announced before the end of the calendar year which will further enhance the strength of the Board. Succession planning for the executives and committee chairs will be a focus area during 2018.

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Redefine International P.L.C. Annual Report 2017 61

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I thank shareholders for their support of the Company’s new Remuneration Policy, which was approved at the AGM in January 2017. During 2016 the CEO received 62 per cent of his target income, considerably below comparable peers. The policy was amended following a strategic review to ensure closer alignment between remuneration, strategy and shareholder returns. The new policy provides the executives with a fair and balanced package that motivates performance and rewards results.

For the first time this year, the Company will be reporting under the 2016 UK Corporate Governance Code (“the Code”) and the Audit and Risk Committee adopted new model terms of reference to comply with the provisions of the new Code, FRC guidance and revised ethical standards published earlier this year. Focus areas for the committee this year have been to oversee compliance and regulatory change, improvement in internal controls and risk reporting.

With robust corporate governance, a strong Board and strategy, I am pleased to report that the Company has delivered a solid set of results and is well positioned to look to the future with confidence.

Full details of the Company’s operations have been laid out in this Annual Report, which the Board has reviewed and considers to be fair, balanced and understandable and provides shareholders with the necessary information with which to assess the Company’s position and performance, business model and strategy. The Board recommends that shareholders vote to adopt the Annual Report and support the re-election of the Board at the AGM to be held on 25 January 2018, where Directors will be available to answer any questions shareholders may have regarding the operation of their Company.

I have informed the Board that I intend to step down as Chairman during 2018. The exact timing will be determined by the process to recruit a new Chair and execute an appropriate handover.

By this time I will have been Chairman of Redefine International for seven years, during which time we have domiciled to London, become a REIT and entered the FTSE 250.

I consider it time to move on and for a new Chair to oversee the next exciting phase of Redefine International’s future.

Greg ClarkeChairman of the Board

26 October 2017

Corporate governance statement Compliance with the UK Corporate Governance Code 2016 (the “Code”)Redefine International is a UK-REIT with a premium listing on the Main Market of the LSE and a secondary listing on the “Real Estate – Real Estate Holding and Development” sector of the Main Board of the JSE. The Company was incorporated in the Isle of Man with registered number 111198C in 2004 and was re-registered under the Isle of Man Companies Act 2006 in December 2013, with registered number 010534V. The Company’s home state is the United Kingdom.

Further to the secondary listing of the Company in South Africa on 28 October 2013, the JSE accepted that Redefine International will primarily comply with the Code as issued by the Financial Reporting Council in April 2016 (www.frc.org.uk) as opposed to the provisions of the King IV Report on Governance for South Africa 2016. It should be noted that during the reporting year ended 31 August 2017 and up to the date of this document the Company has complied with all of the Code principles, but has not complied with the following Code provisions:

a. Code B.1.2. Half of the Board should comprise independent Non-executive Directors.

Explanation: At year end, the Board comprised four executives, four independent non-executives and two non-executives who represent the major shareholder, Redefine Properties Limited.

Although the composition fails to meet the provisions of the Code, the Board structure does meet the Code principles, with no block of individuals dominating the decision making and includes an appropriate combination of Executive and Non-executive Directors. With an additional appointment expected by the end of the year, the balance will be improved, but in order to reach the required Board composition another independent Non-executive Director would need to be appointed, taking the Board size to 13, which is considered too large.

It should be noted that to ensure that there is enough independent oversight of related party transactions, a committee comprising solely of independent Directors has been established to review such matters before deciding whether a transaction can progress to the Board for final consideration.

b. Code B.2.3: Non-executive Directors should be appointed for a specified term.

Explanation: Directors are appointed for a term which expires when either the Director (i) is not re-appointed following retirement, (ii) is removed or vacates office,

(iii) resigns or does not offer himself for re-election, or (iv) terminates his appointment on three months’ notice. It should be noted, that, as a FTSE 250 company, all Directors are subject to annual re-election and therefore it is considered that the Company’s terms are appropriate.

c. Code E2.4: Notice of general meetings. Explanation: The EGM held on 25 April

2017, regarding the acquisition of the German supermarket Portfolio, was held on 14 clear days notice in accordance with the Company’s Articles of Association, rather than the 14 business days required by the Code. This was due to the transaction being time sensitive and the Board was mindful that any delay would cause a transactional risk.

Compliance with the Listing RulesDuring the reporting year, Redefine Properties Limited was regarded as a controlling shareholder of the Company in accordance with LR 6.1.2A. As a Chapter 6 Company with a controlling shareholder, Redefine International has complied with LR 9.8.4 R (14):

1. The Company entered into a relationship Agreement with Redefine Properties on 17 November 2014 (the “Agreement”) and the Board confirms that during the period under review:

a. the Company has complied with the independence provisions included in the Agreement;

b. as far as the Company is aware, Redefine Properties has complied with the independence provisions included in the Agreement; and

c. the election and re-election of independent Directors at the AGM held on 23 January 2017 was conducted in accordance with the election provisions of LR 9.2.2.E and LR 9.2.2F R and approved by:i. the shareholders of the Company;

andii. the independent shareholders of

the Company.2. No independent Director has declined to

support the statements in (1) above.

Compliance with the Disclosure and Transparency RulesThe disclosures required under DTR 7.2 of the Disclosure and Transparency Rules are contained in the following pages of this Directors’ report.

Page 3: Governance Chairman’s statement...with LR 6.1.2A. As a Chapter 6 Company with a controlling shareholder, Redefine International has complied with LR 9.8.4 R (14): 1. The Company

Redefine International P.L.C. Annual Report 201762

Board ofDirectors

GREG CLARKE MBA, BA (Hons)

Chairman Age: 60  Appointed: October 2011Committee: N Independence: Complied with independence criteria of the UK Corporate Governance Code on appointment as Chairman.

Skills and experience: • Significant Board experience, including

CEO and Chair roles• Over 30 years’ experience working for

and running large international public corporations across Europe, Australia and South Africa

• Former CEO of Lend Lease Corporation, an ASX 50 international property corporation

• Former CEO of Cable and Wireless Communications Plc

• Former Chairman of The Football League and former Chairman of the Meteorological Office

External appointments: Chairman of the Football Association, Chairman of two private equity owned businesses.

MIKE WATTERS MBA, BSc Eng. (Civil)

Chief Executive OfficerAge: 58  Appointed: December 2013Committees: C I

Skills and experience: • Over 28 years’ experience in the investment

banking and real estate industries • Significant experience as a director of

property and investment companies in the UK and South Africa (“SA”)

• Former director of Sycom Property Fund, Hyprop Investments Limited and Redefine Properties Limited in SA and Sapphire Retail Fund in the UK

External appointments: Chairman of RedefineBDL Hotel Group, Director of International Hotel Properties Limited.

STEPHEN OAKENFULL CFA, BSc (Hons) Construction

Deputy Chief Executive OfficerAge: 38  Appointed: December 2013Committee: None

Skills and experience: • Over 17 years’ experience working in

corporate finance and real estate• Former COO of Redefine International

Fund Managers• Former analyst at DTZ Corporate

Finance in London • Former management consultant for

Turner & Townsend

External appointments: None.

Directors’ reportGovernance

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DONALD GRANT CA

Chief Financial OfficerAge: 43  Appointed: August 2015Committee: C

Skills and experience: • Over ten years’ experience working in

various banking and broking institutions• Over eight years’ experience working in

the property sector• Former financial controller of Capital

& Counties Properties PLC, a FTSE 250 company

External appointments: None.

ADRIAN HORSBURGH MRICS

Property Director Age: 55  Appointed: March 2014Committee: C

Skills and experience: • 30 years’ experience in the investment

property sector specialising in retail and shopping centres

• Former Retail Investment Director and International Director at Jones Lang LaSalle

• Former Equity Partner and Trainee Surveyor in the investment department at King Sturge

External appointments: None.

All Directors served throughout the year. There were no appointments or resignations.

Key to committees:

A Audit and Risk Committee

C Corporate Social Responsibility Committee

I Investment CommitteeN Nominations CommitteeR Remuneration Committee

Denotes chair of a committee

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Redefine International P.L.C. Annual Report 201764

Directors’ reportGovernance

Board ofDirectors continued

GAVIN TIPPER MBA, CA, BCom, BAcc

Independent Non‑executive DirectorAge: 52  Appointed: August 2011Committees: A N

Skills and experience: • Over 20 years’ financial experience of

companies listed in both the UK and South Africa

• Former technical partner at KPMG • Previously COO of the Coronation Group

External appointments: Non-executive Director of Hyprop Investments Limited, AVI Limited, York Timber Holdings Limited and various private companies and trusts.

SUE FORD ACA, BSc (Hons)

Independent Non‑executive DirectorAge: 57  Appointed: December 2013Committees: A R N

Skills and experience: • Over 30 years’ experience working within

various leading organisations overseeing finance, strategy and governance matters

• Co-founder and former finance director for Metric Property Investment plc, now LondonMetric Property plc, an income focused, diversified FTSE 250 REIT

External appointments: None.

MICHAEL FARROW FCIS, MSc (Corporate Governance)

Senior Independent Non‑executive DirectorAge: 63  Appointed: August 2011 Committees: R A

Skills and experience: • Over 20 years’ experience of UK listed and

private property companies and funds working as a director and a company secretary

• Former Group Company Secretary of Cater Allen, Jersey

• Founding director of Consortia Partnership Limited, a Jersey licensed trust company

External appointments: Chairman of Bellzone Mining Plc, Non-executive Director of RedT Energy plc and Circle Property plc.

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ROBERT ORR MRICS, BSc (Estate Management)

Independent Non‑executive DirectorAge: 58  Appointed: April 2015Committees: I R

Skills and experience: • Over 30 years’ experience of the German

and European real estate markets • Former Country Manager for Germany

and former European CEO at JLL• Founded the International Capital Group

for JLL

External appointments: Non-executive Director of Tishman Speyer Properties (UK) Limited and APCOA Parking Holdings GmbH. Adviser to UK and European Investments and EQT Real Estate 1 Fund. Trustee of Dementia UK.

MARC WAINERNon‑executive DirectorAge: 69  Appointed: August 2011Committee: I

Skills and experience: • Over 35 years’ experience in the property

industry in South Africa • Founder of Investec Property Group,

Investec Bank’s property division • Founder of Redefine Properties Limited

External appointments: Executive Chairman of Redefine Properties Limited. Non-executive Director of Cromwell Property Group, and Echo Polska Properties N.V.

BERNIE NACKAN BA (Econ), SEP

Non‑executive DirectorAge: 73  Appointed: April 2014Committee: None

Skills and experience: • Over 50 years’ experience working in

finance, investment, property in South Africa and Internationally

• Former financial editor of the Rand Daily Mail, managing director of Sage Unit Trusts and Executive Director of Sage Group

• Former member of the Collective Investment Scheme Advisory Committee in South Africa

External appointments: Non-executive Director of Redefine Properties Limited, Chairman of its Investment and Nominations Committee and member of the Remunerations Committee. Non-executive of Rezco Asset Management Limited.

All Directors served throughout the year. There were no appointments or resignations.

Key to committees:

A Audit and Risk Committee

C Corporate Social Responsibility Committee

I Investment CommitteeN Nominations CommitteeR Remuneration Committee

Denotes chair of a committee

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Redefine International P.L.C. Annual Report 201766

Leadership structure

The Board

Led by the Chairman, the Board is collectively responsible for the long term success of the Company and operates under a formal quarterly schedule of matters reserved for the Board. This ensures that the Company’s strategy and objectives, risks, Group operations,

internal controls, policies and debt providers are all reviewed throughout the year. To assist in the effectiveness of its operations, certain matters are delegated to committees whose roles and duties are outlined in terms of reference set by the Board. The committee

chairs provide a summary of the committee activities at each Board meeting, advising of any issues or recommendations. Day-to-day management of the Company is overseen by the CEO and the executives, who carry out the strategy established by the Board,

within the confine of policies and delegated authorities set by the Board.

Each year, four scheduled Board meetings are held, aligned to the financial calendar, and there are four scheduled update calls.

Four meetings, (four update telephone calls) page 69

Committee of the Board Independent Committee of the Board

Approves ad hoc matters between Board meetings Subject to authority levels

To review any related party transactions or matters where a conflict may arise

Directors – any twoIndependent Directors – at least one

Independent Non‑executive Directors – Any three

Eight meetings page 69 Two meetings page 69

Audit and Risk Committee

Nominations Committee

Remuneration Committee

Corporate Social Responsibility Committee

Ensures that the Group’s financial reporting and risk

management is properly monitored, controlled

and reported

Considers the composition, skills and succession planning

of the Board

Determines the remuneration of the Executive Directors

within the approved remuneration policy and monitors employee pay

Safeguards the interests of stakeholders

Independent Non‑executive Directors

Gavin Tipper (chair) Sue Ford

Michael Farrow

Independent Non‑executive Directors

Greg Clarke (chair) Sue Ford

Gavin Tipper

Independent Non‑executive Directors

Michael Farrow (chair) Sue Ford

Robert Orr

Executive DirectorsMike Watters (chair)

Donald GrantAdrian Horsburgh

Four meetings page 74 Three meetings page 70 Two meetings page 78 Three meetings page 48

Investment Committee Executive Committee

Assesses investment proposals as to whether they should progress to the Board

Day-to-day management of the Company

Independent Non‑executive Director

Robert Orr (chair)

Non‑independent Directors

Marc WainerMike Watters

Executive DirectorsMike Watters (chair) – CEO

Stephen Oakenfull – Deputy CEODonald Grant – Chief Financial OfficerAdrian Horsburgh – Property Director

The Investment Committee operates in an informal manner to discuss all major acquisitions, disposals and capital expenditure. Its recommendations

are forwarded to the Board for final consideration.

The Executive Committee meets informally on a weekly basis to discuss acquisitions and disposals, finance, asset management activities and operational

matters, and to consider the status of any potential inside information.

Directors’ reportGovernance

The Board is collectively responsible for the long term success of the Company.

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Board composition

Chairman – Greg Clarke F P U E

Chairman of the Board since 1 December 2011

Responsible for leadership and governance of the Board

There is a clear division of responsibilities between the Chairman, who runs the Board and the CEO, who runs the business

40% Executive Directors Day‑to‑day management of Company

Mike Watters CEO

F P U S E

Stephen Oakenfull Deputy CEO

F P U E

Adrian Horsburgh Property Director

P E U

Donald Grant Chief Financial Officer

U F

40% Independent Non‑executive Directors To constructively challenge the executives and represent the interests of the shareholders

Michael Farrow Senior Independent Director

F P U E

Gavin TipperF S U

Robert OrrP E U

Sue FordU F

20% Non‑executive Directors Representing the Company’s major shareholder – Redefine Properties

Marc WainerF P U E S

Bernie NackanS

Key to skills:  F Finance   P Property   E Europe   U UK listed companies   S SA listed companies

Composition excluding Chairman

40% Executives 20% Non-

executives 40% Independent

Non-executives

Gender diversity9% women 91% men

Average age <40 – 9% 40-50 – 9% 50-60 – 46% 60-70 – 27% >70 – 9%

Board tenureAppointment – Executive

2 years – Donald Grant 3 years – Adrian Horsburgh 4 years – Stephen Oakenfull,

Mike Watters

Appointment – Non-executive 2 years – Robert Orr 3 years – Bernie Nackan 4 years – Sue Ford 6 years – Greg Clarke,

Michael Farrow, Gavin Tipper, Marc Wainer

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Redefine International P.L.C. Annual Report 201768

For related party transactions, any Director with a conflict of interest may be asked to leave the meeting whilst the matter is discussed and opinion letters from the Company’s sponsor, ascertaining as to whether the transaction is ‘fair and reasonable’, are circulated for the independent Directors’ consideration. All related party transactions will be reviewed and approved by a committee comprising solely of independent Non-executive Directors to ensure that the matter is given a measure of independent oversight.

Related Party transactions during the year were:

• Acquisition of the controlling interest in the Leopard Portfolio from Redefine Properties Limited.Redefine Properties is a major shareholder of the Company. A Fair and Reasonable letter was obtained from the Company’s UK sponsors and the transaction was approved by an Independent Committee of the Board and by shareholders at an EGM held on 25 April 2017.

• Scheme of Arrangement to acquire the minority shareholdings in International Hotel Properties Limited (“IHL”), and additional IHL shares from Redefine Properties.Redefine International and Redefine Properties are both shareholders of IHL and Mike Watters is a Director of IHL and Redefine International.

A Fair and Reasonable letter was obtained from the Company’s UK sponsors and from Mazars, and the transaction was approved by an Independent Committee of the Board and by IHL shareholders at an EGM held on 15 September 2017.

Board meeting agendasManagement formally report to the Board on the following standard agenda items, providing information seven days in advance of Board meetings:

• Management report:• report from the CEO;• acquisitions and investments;• disposals;• portfolio report; and• special projects.

• Finance and tax:• financial results;• banking facilities and derivatives; and• treasury and foreign currency exposure.

• Shareholder and investor relations:• shareholder information and trading

statistics;• reports on shareholders’ views; and• shareholder communications.

• Marketing:• report from Head of Marketing.

• Administrative matters:• committee reports;• corporate governance updates; and• corporate governance/administrative

matters.

Board operations

Directors’ reportGovernance

2017 meetings schedule

Meetings Attendance

Four scheduled quarterly Board meetings All Directors attended all the meetings

Four scheduled quarterly conference calls to provide operational updates to Directors

All Directors participated in all the calls

Eight ad hoc Board meetings responding to business needs

Attendance at ad hoc meetings is subject to authority levels requiring either a full Board or a committee of three Directors, one of which must be independent

Two meetings of independent Directors Attended only by independent Directors

All Board meetings and Board calls during 2017 were attended by all the Directors. Additional matters were approved by a Committee of the Board which had the necessary delegated authority or independence levels to oversee such matters.

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Scheduled Board meetings/update calls

Corporate calendar items Non‑standard/ad hocmatters discussed

Ad hoc committee meetings

Matters approved

SeptemberBoard update call

OctoberDividend rebase on EPRA earnings

Foreign exchange rates

Capital Markets Day

DecemberBoard update call

Board meetingReview of all policies

JanuaryStrategy

Stress test and gearing sensitivities

Capital Markets Day

MarchBoard update call

Board meetingInterim results and associated items

Review of matters reserved for the Board

AprilEffects of dividend rebase

Maximising earnings

AprilShareholder Circular for the Leopard Portfolio acquisition(1)

UK Shopping Centre facility agreement

Interim Results

JuneIssue of scrip dividend shares

AugustIHL Scheme of Arrangement(1)

JuneBoard update call

Board meetingReview of Group strategy, objectives and

corporate structure

Review of internal controls and risk management

Review of financial strategy

Review of marketing strategy

JulyProperty cladding assessment

Manchester attacks

Approval of Audit and Risk Committee’s Terms of Reference

OctoberFinancial results for year ended 31 August 2016

NovemberIssue of scrip dividend shares

DecemberAnnual Report

VBG sale

MarchSale of the Observatory, Chatham

(1) Independent committee of the Board.

Board meetingYear end results and associated items

Review and approval of budget

Confirmation of Directors’ independence

Evaluation of Board

Compliance

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Redefine International P.L.C. Annual Report 201770

Nominations Committee

Directors’ reportGovernance

Greg ClarkeChair of the Nominations Committee

Appointed Meetings

Greg Clarke MBA, BA (Hons) 25/10/2011 3/3Gavin Tipper MBA, CA, Bcom, BAcc 30/07/2014 3/3Sue Ford ACA, BSc (Hons) 30/01/2014 3/3

The Nominations Committee operates within terms of reference, a copy of which is available at the website: www.rdireit.com

The evaluation has identified a strong Board with the necessary cohesion to serve our shareholders.

Nominations Committee events during the year

Date Matters discussed Attendees

January 2017

• CEO succession• Progress of internal candidates• Board size and mix

All members

May 2017

• Job specification drawn up for new independent Non-executive Director• Quote from recruitment agencies

All members and Robert Orr

July 2017

• ZRG Partners LLC present diverse pool of 50 candidates • Shortlist of four selected

All members and Robert Orr

September 2017

• Candidates are interviewed Chairman

October 2017

• A shortlist of two candidates are selected All members, ZRG and Robert Orr

October 2017

• Further interviews of the candidates are undertaken and a recommendation is made to the Board

CEO

All members and all independent Directors

Redefine International is an income focused diversified UK-REIT, listed in the UK and South Africa, with properties in the UK and Germany. For such a diversified company, it is essential that the Board has the right balance, knowledge and skills appropriate for overseeing the business and, as the Chairman is responsible for the leadership and effectiveness of the Board, it is appropriate

for the Nominations Committee to be led by the Chairman, Greg Clarke. Two independent Non-executive Directors, from the UK and SA, complete the committee, and all members have significant experience as Directors of listed companies and are aware of the skills necessary for the operation of a dual listed diversified company.

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Board composition The Nominations Committee started the year by reviewing the size and mix of the Board.

Since 2015 the Board has comprised 11 Directors: the Chairman, four executives, four independent non-executives and two non-executives. This composition is not compliant with the UK Corporate Governance Code, and although the Board works well, the Nominations Committee was mindful that there was not enough independent oversight on the Board, and was intent on improving the level of independence. However, in 2016 due to the pending requirement for a prospectus in February 2016 to support the capital raise, for which a new Director would have taken full responsibility, it was considered in everyone’s best interests that the matter be put on hold. The Nominations Committee was keen to address this matter again in 2017.

Before commencing the search for a new independent Non-executive Director, the Nominations Committee reviewed the mix of the Board to identify any potential area of weakness, to ensure that the Board was fully equipped to deal with the current strategy and any potential challenges ahead. The Committee agreed with the conclusions of last year’s external evaluation that the Board had a good balance of skills with a strong industry focus and deep financial expertise with sufficient knowledge of the European markets, and no major skill gaps.

Diversity was considered. The Directors number ten male and one female, aged from 38 to 74, with a range of different educational backgrounds from the UK, South Africa and New Zealand. Although the Nominations Committee considered there to be a diversity of thought, the Board is committed to having an appropriate level of diversity which reflects the nature of the Group’s operations. The Committee acknowledged that gender diversity and ethnicity was poor.

ZRG Partners LLC, which has no prior connection with the Company, was appointed to assist with the search for an independent Non-executive Director and instructed to encourage a wide pool of candidates with experience of Board membership, evidence and understanding of business strategy and shareholder value creation with property or property finance expertise. A long list of 50 diverse candidates was drawn up, 14 were interviewed and four were recommended to be shortlisted. Those shortlisted were discussed at length by the Nominations Committee assisted by Robert Orr, an independent Non-executive Director with a depth of property experience.

The two best candidates were interviewed by the CEO, and separately by the Nominations Committee. As well as assessing skills and experience, it was important that the new Director fit into the Board chemistry, as the current Board works well as a team. The Boardroom culture is good natured and constructive and relationships between Executive and Non-executive Directors are good, although Non-executive Directors are not afraid to challenge executives during meetings. The Chairman and CEO set a tone of openness and thoroughness which is upheld by the Board, and Directors hold themselves to a high standard of integrity.

Following an in-depth discussion between the Nominations Committee and all the independent Non-executive Directors to consider the merits of each candidate, a final recommendation will be made to the Board in the near future. It is hoped that an announcement will be made to shareholders before the end of the year.

The appointment of an additional independent Non-executive Director will improve the level of independent oversight, and will provide an opportunity to review and possibly refresh membership of the Committees. Diversity on the Board will also be improved, and the Company is confident it will be able to meet its target of one third female membership by 2020.

Appointment terms All new Non-executive Directors are provided with a letter of appointment detailing the terms of their appointment and their expected commitment to the role. Non-executive Directors are not appointed for a specified term, but until the Director is either (i) not re-appointed following retirement, (ii) removed or vacates office, (iii) resigns or does not offer himself for re-election, or (iv) terminates his appointment on three months’ notice.

All Directors are expected to attend the quarterly Board meetings, quarterly update calls, any committees of which they are a member and shareholders meetings. Non-executive Directors are expected to make themselves available for a minimum of eight days per year in the discharge of their duties.

The Board has agreed that any Director may, if necessary in the furtherance of their duties, take independent professional advice at the Company’s expense, subject to having first notified the Company Secretary. Any such payment by the Company would, of course, be subject to any restriction under company law.

The Company has liability insurance which covers Directors and officers of the Company and any subsidiary company of Redefine International.

Conflict of interest policyDirectors are not, without the consent of the Board, to accept any other appointment or enter into any arrangement which might reasonably be expected to lead to a conflict of interest arising.

Furthermore, Directors must not hold any directorships of any company (other than the Company or a subsidiary of the Company) of which any Director of the Company or any of its subsidiaries or of the property adviser or property manager to the Company (or any shareholder of such entities) is also a Director without the prior written approval of the Board. Any possible appointments are discussed with the Chairman to ensure that there are no conflicts of interest or that a Director’s independence is not compromised.

Directors’ induction An induction afternoon is provided by the executive team, which includes an overview of the historical activities of the Group, funding options and providers and property details. Further information is provided on the Company’s key business and risks along with the latest financial information for the Group. The Company Secretary provides a list of matters reserved for the Board, the corporate calendar and an overview of the Directors’ obligations for an Isle of Man company with a dual listing. Further information is provided tailored to the needs of each Director.

Meetings with key advisers are set up, as required, and tours of the properties are undertaken to provide a full overview of the Company’s activities.

Directors are also provided with details of the Board evaluation undertaken at the end of the financial year.

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Directors’ reportGovernance

Board evaluationThe 2017 evaluation was performed using an online questionnaire which allowed each Director to anonymously evaluate the performance of the Chairman, the individual Board members, the Board operations and its committees.

The main strengths of the Board identified were:

• the diversity of expertise;• the level of experience; • the robust debate; and • the agility of the Board to respond to situations.

All Directors enjoyed Board meetings, which is a key characteristic of a motivated and successful team. However, with the uncertainty of Brexit and the UK economy, Directors highlighted that, for the year ahead, more focus and time should be spent on the points listed below. Disappointingly, these are broadly the same points as raised at last year’s external evaluation, although action has already been taken to address many of these points:

Long term strategic decision making

Long term decision making is to be addressed with strategy days planned for next year.

Thorough risk analysis

Risk governance has been a strong focus for the Audit and Risk Committee meetings during the year. Full details of their review and findings were presented at the October Board meeting and will continue to be presented to the Board on a six month basis going forward to ensure that the Board, as well as the Audit and Risk Committee, have a full overview of risks.

Shareholders and stakeholders

The work of the CSR Committee is now finding momentum and, as it becomes embedded into everyday operations, will improve and increase importance in 2018, the road map for which can be found on page 59 of the Annual Report.

Board composition

Board composition will be improved with the appointment of a new Independent Non-executive Director enhancing independence and diversity on the Board. Composition will continue to be reviewed.

Succession The Nominations Committee has been primarily focused on succession planning for the CEO. Mike Watters was CEO of the management company from 2008 and, following internalisation of management, became the CEO of Redefine International in 2013. The possible retirement or departure of such a long standing employee obviously is a large risk to the Company and the Chairman has been personally managing the development of the Deputy CEO, Stephen Oakenfull, involving mentoring, arranging external residential management development programmes and increased external networking.

A succession plan of internal candidates has been drawn up by management, and a presentation by the pipeline candidates will be given to the Non-executives next year so they are able to meet and question the potential successors to the executives.

Directors’ training As part of the evaluation, each Director was assessed by the rest of the Board. The Chairman discussed the results with each Director. Any training and development needs were identified and Directors were encouraged to update their skills, knowledge and familiarity with the Company to fulfil their roles on the Board.

Advisers and managers may be asked to present at meetings to provide Directors with detailed information relating to the Company. Property tours are undertaken to enable Directors to view the Company’s assets and discuss matters directly with the responsible asset manager.

At each Board meeting, Directors are kept abreast of changes to regulatory rules and corporate governance matters and any concerns or developments regarding, inter alia, insurance, health and safety, sustainability, bribery and whistleblowing, cyber security and the Modern Slavery Act.

Nominations Committee continued

Directors’ re‑electionAll Directors will be standing for re-election at the AGM on 25 January 2018. The Chairman considers that each of the Directors continue to be effective members of the Board, that collectively they hold the requisite range of skills to enable the Board to operate successfully, and the Directors function well together as a team.

It is noted that Michael Farrow and Gavin Tipper have both been on the Board for six years. Michael Farrow and Gavin Tipper were evaluated by the rest of the Board as being either good or outstanding Directors and were considered to spend sufficient time, and were committed to their roles as Directors of the Board and as chairs of committees.

The Chairman therefore recommends all Directors for re-election at the AGM on 25 January 2018.

Re‑election of independent DirectorsThe interests of each of the independent Directors are monitored to ensure that their position is not compromised and are checked each year against the requirements of the Code, to ensure their independence is still valid.

The Chairman is satisfied that Michael Farrow, Gavin Tipper, Sue Ford and Robert Orr remain independent in both character and judgement and adhere to the independence criteria of the Code.

Their biographical details can be found on pages 62 to 65 and are contained in the AGM Notice of Meeting.

Greg ClarkeChair of the Nominations Committee

26 October 2017

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Accountability

Investor relations

Key investor events held:

7 – 8 September 2016 EPRA conference – received EPRA most improved financials award and presented on the mid-cap UK panel30 September 2016 Property day focused on Berlin and Hamburg assets with South African investors27 October 2016 2016 Full Year Results Announcement27 October – 2016 Full Year Results Roadshow – UK 4 November 2016 (including Scotland)11 January 2017 JPM European Real Estate CEO Conference23 January 2017 AGM6 February 2017 Capital Markets Day in UK and live webcast7 – 20 February 2017 Strategy and Pre-close Roadshow – SA and UK

1 March 2017 Jeffries Property Panel to debate Income vs Growth26 April 2017 2017 Half Year Results Announcement27 – 28 April 2017 2017 Half Year Results Roadshow – UK5 – 6 June 2017 JPM Amsterdam Roadshow20 – 21 June 2017 Germany property site visit hosted by Instinctif for South African investors6 – 7 September 2017 EPRA conference12 September 2017 JP Morgan Mid Cap Conference26 October 2017 2017 Full Year Results Announcement26 October 2017 – 2017 Full Year Results Roadshow – SA and UK 3 November 2017

The Board endeavours to regularly engage and communicate clearly with shareholders throughout the year, promoting dialogue with both existing and potential investors on Company strategy, management, remuneration and governance. The four Executive Directors, who act as the primary contact for institutional shareholders, are supported by the Head of Investor Relations with Non-executive Directors attending and meeting investors at results presentations and property tours.

Directors are kept informed of investor relations through a quarterly report and timely updates. They are provided with analyst coverage of the Company and any feedback received from investors. In addition, shareholders are invited to directly contact the executives to raise any matters, opinions or issues of concern with the Company and are encouraged to attend the AGM to put any questions to the Board, in person.

January 2017 AGM The AGM was held on 23 January 2017 at the Company’s head office in London. Approximately 70 per cent of all shareholders voted but it was noted that a significant amount of shareholders, particularly on the JSE register, voted against four resolutions, namely: the new Remuneration Policy (20.09 per cent), the general Directors’ authority to allot shares (20.56 per cent); the disapplication of pre-emption rights limited to a five per cent issuance of shares for cash (19.54 per cent) and a further five per cent issuance of shares for cash in connection with a specified investment (21.10 per cent). The proposed authorities were in line with current UK

guidelines, but the Board is aware that such guidelines differ to those in South Africa and advised that it would continue to liaise with South African shareholders on such matters.

February 2017 Capital Markets DayA Capital Markets Day was held in February which was well attended by both buy side and sell side analysts, reflecting efforts by the Company to engage with these audiences. The general consensus on conclusion of all meetings was that the majority of holders and non-holders were supportive of the long-term strategy to rebase the dividend in exchange for a higher growth outlook and stronger balance sheet whilst still maintaining a top quartile dividend yield. There was some concern about how the Company would balance the reduction of LTV, whilst maintaining a sufficiently strong dividend yield to ensure the Company’s shares remain attractive. Caution and concern was also raised around Brexit, and the Company will endeavour to provide information regarding how this issue is being addressed. The event was seen as a success and there was appetite for the Company to host similar events in the future.

April 2017 EGMAn EGM was held on 25 April 2017, in connection with the proposed acquisition of the controlling interest in the German supermarket portfolio. The EGM was called on 14 days’ clear notice in accordance with the Company’s Articles of Association due to the transaction being time sensitive and the Board was mindful that any delay could cause transactional risk. 59 per cent of independent shareholders voted, with shareholders voting overwhelmingly in favour of the proposal.

January 2018 AGMThis year’s AGM is due to be held at 11.00am on 25 January 2018, at the Company’s new Head Office at 33 Regent Street, London, SW1Y 4NE. The AGM Notice will be sent to shareholders on 15 December 2017, more than 20 business days in advance of the meeting, and will contain all the notes for the proposed resolutions rather than referencing sections in the Annual Report, for the shareholders’ convenience and consideration.

It should be noted that, following significant opposition to certain resolutions at the 2017 AGM, the executives have liaised with South African investors. The routine request authorising Directors to allot up to one third of the existing issued share capital and a further one third for pre-emptive rights issues, has subsequently been reduced to a general authority to allot 20 per cent of the Company’s current issued share capital, of which half, it is proposed, could be issued in cash. This level is more in line with South African guidelines, and the Board hopes that shareholders will now be supportive of all resolutions at the 2018 AGM.

Website and appTo enable the effective distribution of information to investors, all communications and related presentation materials are published on a timely basis on the website, which has been improved to promote ease of use: www.rdireit.com

An investor relations app is now available to deliver easily accessible information on day-to-day operations and business performance.

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Directors’ reportAccountability

Audit and Risk Committee (the “Committee”)

Gavin TipperChair of the Audit and Risk Committee

Appointed Meetings

Gavin Tipper MBA, CA, Bcom, BAcc 28/06/2012 4/4Michael Farrow FCIS, MSc 23/08/2011 4/4Sue Ford ACA, BSc (Hons) 30/01/2014 4/4

The Audit and Risk Committee operates within terms of reference, a copy of which is available at the website: www.rdireit.com

The terms of reference under which the Audit and Risk Committee operates, were updated and approved by the Board in July 2017. These take account of the changes incorporated in the 2016 UK Corporate Governance Code, the FRC guidance and the revised ethical standards.

Audit and Risk Committee events during the year

Date Matters discussed Attendees

October 2016

• Report from management• Consideration and review of the Financial Results for year ended

31 August 2016• Presentation from Strutt & Parker, valuers of the UK shopping centres• Presentations from management, explaining the procedures

undertaken to ensure applicability of annual attestations and to confirm that the results were fair, balanced and understandable

• Presentation by internal auditor on the results of the reviews performed

• Presentation by external auditor on the results of the audit for the year ended 31 August 2016

• Review of external auditor effectiveness and consideration for reappointment

• Consideration of viability and going concern statements• Consideration of dividend

The Committee

CEO

Deputy CEO

CFO

Financial Controller

External Auditor

Internal Auditor

Valuers

January 2017

• Presentation of interim review plan by external auditor• Consideration and approval of external audit fee

The Committee

CFO

Financial Controller

External Auditor

April 2017

• Report from management• Consideration and review of the Interim Results for the six months

ended 28 February 2017• Presentation by Savills, valuers of the German Shopping centre

portfolio• Presentations from management, internal and external auditors• Review of governance matters and applicable policies• Update of finance information technology developments• Consideration of dividend

The Committee

CEO

CFO

External Auditor

Internal Auditor

Valuers

July 2017

• Report from management• External auditor presentation of strategy and plan for the year-end audit• Review of key areas of judgement and uncertainty• Presentation of findings from risk review process• Internal controls review• Consideration of the effectiveness of internal audit• Approval of 2018 internal audit plan

The Committee

CEO

CFO

Financial Controller

External Auditor

Internal Auditor

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The Committee comprises three independent Non-executive Directors, who are considered to have the necessary skills, knowledge and professional qualifications to understand the financial complexities of the Company’s business, the applicable accounting standards and regulatory framework and who, as a whole, have experience of working in the property sector in which the Group operates.

• Gavin Tipper is a Chartered Accountant with over 25 years’ financial experience in listed and unlisted companies, including property companies;

• Sue Ford is also a Chartered Accountant with over 30 years of financial experience and was a co-founder and, until 2013, the finance director of Metric Property Investments, a UK-REIT focused on the retail sector of commercial real estate; and

• Michael Farrow is a Chartered Secretary with 30 years’ experience who has worked in a number of listed and private property companies.

The terms of reference under which the Audit and Risk Committee operates were updated and approved by the Board in July 2017. These take account of the changes incorporated in the 2016 UK Corporate Governance Code, against which the Company is reporting this year, and the FRC guidance and revised ethical standards published earlier this year.

The terms of reference outline the role of the Audit and Risk Committee relating to the interests of shareholders regarding financial reporting, internal controls and risk management. The Committee also seeks to provide the Board with assurance regarding the efficacy and reliability of the financial information used by the Directors in the discharge of their duties, and to comment on associated risks.

The Committee is responsible for monitoring the effectiveness of internal controls, the internal and external auditors, the provision of non-audit services and the independence of the external auditor. It is also responsible for reviewing and assessing the integrity of the risk control systems, for ensuring that risk policies and strategies exist and that there is

an effective risk management process in place. Details of the principal risks facing the Group are set out on pages 16 and 17 and in note 34 to the financial statements.

The Committee held four meetings during the financial year, aligned to the Company’s financial reporting and risk management cycle. Committee packs are sent out seven days in advance of meetings to allow members time to properly consider the matters to be discussed. Independent external advice may be taken by the Committee if required, although none was sought this year. Time is provided during the year for the Committee to meet privately with both the external and internal auditors, without the executives or management being present, to discuss any potential issues or concerns.

All meetings were attended by the Committee members, the Chief Financial Officer and representatives of the auditors. Valuers attended two meetings to discuss the processes undertaken in determining the market values of selected portfolios at each reporting date. The valuers for the UK and German shopping centre portfolio were invited to attend this year.

During the year the Committee reported to the Board at each Board meeting on its responsibilities:

Audit plans• the Committee met with the external

auditor at the audit planning and reporting stages to consider and discuss the audit strategy and plan, the results of the audit work undertaken and areas of significant complexity, judgement or uncertainty; and

• the Committee approved the internal auditor’s risk based audit plan for the financial year and the related audit fee.

Reviewing effectiveness• of the external and internal auditors;• of internal controls, particularly financial

controls, and confirmed to the Board that they remained appropriate;

• of the systems of risk management; and• of the Group’s whistleblowing and

anti-bribery policies.

Monitoring• REIT compliance;• the level of non-audit services provided by

the external auditor; • cyber risk and security;• reports from the JSE addressed to Audit

Committee chairs; and• compliance with statutory and listing

obligations.

Assurances• met with independent property valuers

to discuss the valuation processes applicable to selected property portfolios and considered the appropriateness of the assumptions underlying the property valuations; and

• received and reviewed reports from the Group’s Chief Financial Officer and Financial Controller relating to the various assurances provided by the committee.

Recommendations to the Board• the dividend;• the Annual Report as a fair, balanced and

understandable assessment of the Group’s financial position and results for the financial year;

• the interim and annual financial statements, the accounting policies used, and the appropriateness of the related judgements and estimates;

• the Group’s viability statement, including the appropriateness of the underlying methodology, assumptions and stress tests applied (refer to page 17);

• the appropriateness of the application of the going concern concept (refer to page 92); and

• the re-appointment of the external auditor.

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Directors’ reportAccountability

Audit and Risk Committee continued

Significant areas of judgementIn recommending the financial statements to the Board, the Committee assessed whether suitable accounting policies had been adopted and whether management had made appropriate estimates and judgements. The Committee considered areas of judgement when assessing classification, provisioning and the appropriateness of inputs used in arriving at fair value. The following matters are examples of the complex areas of estimation and judgement considered by the Committee during the year.

Valuation of investment propertyInvestment property valuations are the most significant judgement in the Group’s balance sheet and changes to valuations can impact materially on financial performance. Property valuations require significant judgements and estimates and are based on assumptions including estimated rental values, future rental income, anticipated maintenance costs and future development costs and market yields.

The conclusion of the Committee was that:

• the valuation processes, which included the use of external valuers, appeared to be thorough and meticulous;

• the assets were valued on a highest and best use basis, consistent with prior periods;

• the assets were valued using reasonable estimates and professional judgements; and

• the assets were valued on a basis which took account of comparable market transactions.

Fair value of restructured liabilitiesNew borrowings or existing borrowings which have been substantially modified are recognised at fair value. The determination of fair value involves the application of judgement with the key judgement involving an assessment of whether the transaction price equates to fair value, and if not, what the market price should be. During the year the Group refinanced its Aviva UK shopping centre facility and it was determined that a significant modification had occurred. Judgement was applied to determine whether the contractual rate on the refinanced debt represented a market rate and if not, what observable market rate should apply having regard to the term, duration and security arrangements in place. The Committee concluded that the approach taken by management was reasonable and that the transaction price was not a market price and that sufficient observable inputs were available.

TaxationThe Committee satisfies itself as to the judgements applied in the calculation of any provisions for taxation where final determination of the amounts was outstanding.

Risk management reviewA Risk Register has been established which aggregates the Group’s significant risks from its various divisions and corporate functions. The threshold for a risk to be determined as “significant” was established as being either a risk carrying a potential impact of five per cent or greater of the Group’s distributable earnings; or a risk with the potential to expose the Group to reputational damage. The risks as reflected in the risk register were reviewed, challenged and analysed to highlight any significant shifts in the Group’s risk profile. In comparison to last year key changes were:

• political and economic uncertainty resulting from Brexit, leading to potential volatility in share prices and valuations;

• higher expectations on inflation and a consequential impact on interest rates;

• changing consumer behaviour and the impact on rental income, tenant default, and valuation on the retail portfolio;

• development risk due to delays and the resultant impact on returns;

• the type of cladding and insulation materials in place, following the Grenfell disaster;

• tax risk arising from enquiries or changing legislation (BEPS and new tax evasion legislation);

• key person and key supplier risk;• potential terrorist action; and• an improvement in the outlook for Europe,

reducing the risk of adverse foreign currency fluctuations.

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Report on internal controls and effectiveness of internal audit The internal auditor reported to the Committee at each of its meetings, with the main areas of focus during the year being liquidity forecasting, risk management, capital expenditure, human resources and compliance.

With the appointment of a dedicated in-house resource and the appointment of Grant Thornton as internal auditor last year, the internal audit framework within the Company has improved.

The internal auditor tracks the issues to be resolved, and ensures that they are suitably addressed within an agreed timeframe.

Effectiveness, independence and appointment of the external auditorKPMG was appointed via a tender process in 2010 and has expressed their willingness to remain in office. The Committee intends to put the audit out to tender during 2018, which aligns with the scheduled rotation of the audit partner.

The Committee has undertaken its annual review, with the auditor, of any threats to its independence and has concluded that the auditor may continue to be considered as independent.

In this regard KPMG has informed the Committee of all significant facts and matters, including those related to the provision of non-audit services, and the safeguards it has in place to maintain its independence, which it considers may impact on its independence, and the objectivity of the main audit partner on the team. KPMG undergoes regular reviews of the composition of the audit team, including rotation in accordance with relevant regulations.

In assessing the effectiveness and level of service from the external auditor, the Committee considered KPMG’s knowledge of the market and Group, the depth of understanding of the key accounting and audit judgements, the extent to which the audit plan was carried out, input from management and the content of the auditor’s reports to the Committee. The Committee was satisfied with the effectiveness of the external audit.

The Committee monitored the ratio of audit to non-audit services, and related fees and the level of non-audit services and fees incurred during the year was compliant with the Company’s policy in that regard.

The Committee is satisfied that KPMG is independent, and recommends the re-appointment of KPMG at the Company’s AGM on 25 January 2018.

Audit feesThe following fees were paid to KPMG during the year, and are included in net operating income in the Group income statement:

Year ended Year ended 31 August 31 August 2017 2016 £m £m

Audit fees 0.4 0.4Total 0.4 0.4Non-audit fees Reporting accountant under Listing Rules(1) — 0.3Total 0.4 0.7

(1) Required for the AUK acquisition and related capital raise.

Gavin TipperChair of the Audit and Risk Committee

26 October 2017

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Redefine International P.L.C. Annual Report 201778

Directors’ reportRemuneration – unaudited

Remuneration Committee events during the year

Effective date Event Result

31 August 2016

• Performance period ends for the first executive awards made under the 2013 long term incentive plan (“LTIP”) and Remuneration Policy approved by shareholders at 2015 AGM

• 0% vesting (as explained on page 70 of the 2016 Annual Report)

1 September 2016

• Review of 2017 salaries for executives and senior management

• Executives: salaries adjusted as discussed on page 70 of the 2016 Annual Report

1 September 2016

• Review of 2017 Non-executive Director fees

• Non-executive Director fees adjusted as discussed on page 70 of the 2016 Annual Report

17 October 2016

• Appointment of Deloitte as advisers to Remuneration Committee

• Replacement of Willis Towers Watson, who had served as the Company’s remuneration consultants since 2013

20 December 2016

• Award of 2016 bonuses for executives and senior management

• Executive 55% bonus paid in cash, as discussed on page 70 of the 2016 Annual Report

23 January 2017

• New Remuneration Policy recommended to shareholders at the 2017 AGM

• Approved by 79.91% of shareholders

25 January 2017

• Grant of 2017 contingent awards under the Remuneration Policy approved by shareholders at the 2017 AGM

• Award made to executives equivalent to 200% of salary, based on the performance period 1 September 2016 – 31 August 2019.

25 January 2017

• Board considers Non-executive Director fees for committee chairs

• All committee chairs to be paid £50,500 from 1 December 2016, to acknowledge their time commitment

31 August 2017

• Performance period ends in respect of the 2014 awards made under the 2013 LTIP and Remuneration Policy approved by shareholders at 2015 AGM

• 0% vesting, for the second year running

1 September 2017

• Review of 2018 salaries for executives and senior management

• Executives: 4% increase

1 September 2017

• Review of 2018 Non-executive Director fees

• 2% – 4.5% increase. Aggregate fees £389,000, within the £420,000 fees permitted in the Articles of Association

1 September 2017

• 2017 bonus award • Executives: 121.9% bonus (60% of which will be paid in cash in December 2017, 40% awarded in shares deferred for two years to be settled in September 2019)

Michael FarrowChair of the Remuneration Committee

Meetings Appointed attended

Michael Farrow FCIS, MSc 23/01/2013 2/2Sue Ford ACA, BSc (Hons) 10/09/2015 2/2Robert Orr MRICS, BSc 23/04/2015 2/2

The Remuneration Committee operates within terms of reference, a copy of which is available at the website: www.rdireit.com

Directors’ remuneration

A new remuneration policy for the Executive Directors was approved by shareholders at the 2017 AGM: No changes have been proposed to the executive remuneration policy this year.

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5%One special award of 15%

121.9% of salary(40% paid in deferred shares)

0%Vesting

Salary increase Bonus LTIP vesting

Awarded 1 September 2016

Employee increase 6.3%

Awarded for the performance period 1 September 2016 – 31 August 2017

Maximum award 150% of salary:

• 45% Underlying Distributable Earnings;

• 45% NAV growth;

• 22.5% cash flow; and

• 37.5% Personal objectives.

Awarded for the three year performance period ended 31 August 2017

Based on the policy approved at the 2015 AGM

Company’s TSR measured against:

• a bespoke peer group TSR; and

• the FTSE EPRA/NAREIT Developed Europe Index.

2017 remuneration at a glance

Total remuneration received for year ended 31 August 2017

Mike Watters £948,059

Stephen Oakenfull £650,302

Adrian Horsburgh £594,804

Donald Grant £550,980

Actual salary paid    Annual bonus payable in respect of the financial year    Pension    Taxable benefits

Read more on Single figure remuneration on page 86

Executive single total figure of remuneration for 2017

0 100,000 300,000 500,000 600,000 700,000 800,000 900,000200,000 400,000 1,000,000£

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Redefine International P.L.C. Annual Report 201780

Directors’ reportRemuneration – unaudited

Annual statement by the Chairman of the Remuneration Committee (“RemCo”)For the year ended 31 August 2017 (not subject to audit)

IntroductionOn behalf of the Board, I am pleased to present the Directors’ remuneration report for the year ended 31 August 2017. It should be noted that as an Isle of Man company, Redefine International is voluntarily reporting under the UK regulations in order to provide transparency to our shareholders.

2017 Policy: New Executive Remuneration Policy approved by shareholders on 23 January 2017At the start of the financial year, the RemCo concluded that the executive remuneration package, but particularly the outcome of the LTIP, did not correctly reflect the executives’ performance nor did it align with shareholder returns achieved over the same period. A strategic review of the remuneration policy was therefore undertaken.

A new remuneration policy for the Executive Directors was recommended and approved by 79.91 per cent of shareholders at the AGM on 23 January 2017 (the “New Policy”) and applied to all remuneration components awarded after that date. The New Policy will remain in place for the next three years unless any material changes are proposed. No changes have been proposed to the executive remuneration policy this year.

A summary of the New Policy can be found on pages 84 to 85.

Remuneration for the 2017 financial year2017 Performance: the table overleaf shows how the executives have implemented the strategic priorities as detailed on pages 14 and 15 of this Annual Report, and how their actions reflect on the bonus targets.

2017 Salary: awarded 1 September 2016.

The average salary increase for employees for 2017 was 6.3 per cent. A 15 per cent salary increase was awarded to the Deputy CEO to bring his salary closer to that of the CEO and to recognise his increased responsibilities within the executive team. All other executives received a 5 per cent increase which, although above inflation, still resulted in their salaries being in the lower quartile of our peer group.

2017 Bonus: awarded for the performance period 1 September 2016 – 31 August 2017.

Due to redressing the balance between long and short term compensation, the maximum executive bonus has increased from 100 per cent to 150 per cent of base salary. Having exceeded the targets set for cash flow, NAV and achieving the target for earnings, the executives have been awarded a cash bonus of 121.9 per cent of base salary. Of the award, 60 per cent will be settled in cash immediately with 40 per cent deferred for two years, subject to continuous employment in the Group, and to be settled in shares. The bonus award is in line with in the lower quartile of the FTSE 250, where the Company is currently positioned.

2017 LTIP vesting: for the three year performance period ended 31 August 2017.

The performance period for the award related to the three years ending 31 August 2017 and was subject to the historic TSR performance conditions. The outcome of the LTIP award has again resulted in nil vesting.

2017 LTIP Contingent award: awarded for the three year performance period from 1 September 2016 to 31 August 2019.

Contingent awards, equivalent to 200 per cent of salary, were made to each of the executives on 25 January 2017. These will be subject to the performance criteria set out in the New Policy approved at the 2017 AGM and will, subject to performance, vest on 25 January 2020.

2017 Single figure remuneration: the total remuneration package received for the 2017 resulted in the executives’ total salaries remaining in the lower quartile of the FTSE 250. On average, the executives received 56 per cent of target remuneration outlined in the implementation scenario within the 2014 Annual Report.

2017 Non‑executive Director feesOn 1 September 2016, Non-executive Directors received a fee increase of £3,000 and the Chairman received an increase in fee of £6,500. These awards were made in recognition of increased responsibilities following the completion of AUK transaction, and the substantial augmentation of the Company. This resulted in the standard Non-executive Director fee being £43,000, although the Audit and Risk Committee chair was paid £50,500 and the Remuneration Committee chair was paid £48,000 to recognise their additional time commitments.

Following the review of the remuneration policy by the RemCo and the work undertaken by the Investment Committee for the AUK transaction, the Board wished to acknowledge the increase in responsibilities, significant time commitment shared by all the committee chairs and resolved that the fees of all committee chairs be brought in line. From 1 December 2016, all committee chairs have been paid £50,500.

Although these increases were above market norm, the fees for the Non-executive Directors and chairs remained in the lower quartile of the FTSE 250.

Directors’ remuneration continued

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2017 Executive performance

Bonus KPI

Weight of award (Maximum 150%)

2017 performance achieved Actions taken by executives during the year

Link to strategy(1)

Higher earnings 45% 50%(budget met)

• Capital was recycled into assets with stronger potential growth or used to lower the level of gearing and associated finance costs, which has strengthened the balance sheet and capital structure.

• Newer assets have delivered significant value. The AUK assets have seen 6.2% valuation growth and 7.2% growth in triple net income since their acquisition in 2016.

• Asset management activities targeting our best performing assets. Demonstrated through the potential development of Charing Cross Road, London and extensions at Banbury Cross Retail Park and Holiday Inn Express Southwark.

Growth in NAV 45% 100%(120% of budget achieved)

• Disposals totalled £148.2 million during the year, at an average 12.2% premium to book value. Properties sold tended to demonstrate weak longer term growth potential, thus strengthening the underlying property fundamentals of the portfolio.

• Active recycling of capital into assets demonstrating stronger property fundamentals.

• Focusing on assets in geographical locations with the best growth potential. Demonstrated with the IHL acquisition where properties are located in the South East of England or big six UK centres.

Stronger operating cash flow

22.5% 100%(120% of budget achieved)

• Re-financing activity has seen the average cost of debt reduced to 3.1% (from 3.4% in 2016, resulting in a significant finance cost saving).

• Internal cost of capital reduced with stronger dividend cover and headroom on operational cash flow.

• Maintained headroom over operational cash flow to invest in asset management initiatives to grow value.

• More flexible capital structure has allowed the Group to apply available cash reserves against revolving credit facility to achieve lower ratcheted margin throughout the year.

• Extended debt maturity profile following refinancing initiatives removing refinancing risk with no significant maturities until 2020.

Personal objectives 37.5% 85%(at RemCo’s discretion)

• Leadership: at the Capital Markets Day held in February 2017, the Company outlined clear and measurable medium term targets and the executives have demonstrated conviction in executing and delivering on all targets throughout the year.

• Communication with shareholders:• extensive UK and South African road shows and to meet, explain and listen

to major shareholder views;• positive investor and analyst feedback following simplification of strategic

objectives, clear communication, and no surprises in full results; and• active engagement with investment market as demonstrated by the quantum

of capital recycling completed and premiums to book values achieved.• Communication with stakeholders: CSR initiatives undertaken to engage with

communities and tenants, GRESB improvement and all suppliers required to abide by our code of ethics.

• Loyalty of staff: a desirable working culture and environment has been developed, demonstrated by a low staff turnover and a positive employee survey outcome.

Income focused portfolio     Efficient capital structure     Financial discipline     Scalable business  (1) See page 14.

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Redefine International P.L.C. Annual Report 201782

Directors’ reportRemuneration – unaudited

Directors’ remuneration continued

Statement of implementation of remuneration for the 2018 financial yearSet out below is a summary of the planned implementation of the remuneration policy for the financial year ending 31 August 2018.

2018 Salary: awarded 1 September 2017.

2017 2018

Mike Watters £391,000 £406,600Stephen Oakenfull £278,100 £289,200Adrian Horsburgh £253,100 £263,200Donald Grant £235,200 £244,600

Average salary increases of 4.6 per cent have been awarded to employees for 2018, which was arrived at using a base inflationary adjustment of +2.5 per cent with additional increases awarded to recognise extra responsibilities, progress made in professional exams and changes in roles. Taking this into account, and a review of relevant market data, the executives were all awarded a 4 per cent increase.

2018 Pension and benefits: Company pension contribution remains at 12.5 per cent of salary for the CEO and 9 per cent of salary for other Executive Directors. Other benefits comprise life assurance, private medical insurance, car allowance (CEO only), incapacity benefit, season ticket allowance and Directors’ and officer’s insurance.

2018 Annual bonus: to be awarded for the performance period 1 September 2017 – 31 August 2018.

Executive Directors can be awarded a bonus of up to 150 per cent of salary. This is based on underlying distributable earnings (45 per cent), adjusted NAV growth (45 per cent), operating cash flow performance (22.5 per cent) and personal objectives (37.5 per cent). 40 per cent of any award made will be subject to a two year deferral period, to be settled in shares. The targets for financial measures are deemed to be commercially sensitive. However, retrospective disclosure of the targets and performance against them will be provided in future remuneration reports.

2018 LTIP vesting: relating to the three year performance period ending 31 August 2018.

The awards made on 28 October 2015, for the performance period 1 September 2015 to 31 August 2018, will vest on 28 October 2018. These awards are the last awards subject to the old policy performance conditions, approved by shareholders at the 2015 AGM. This required the attainment of certain targets, each weighted at 50 per cent, relating to the performance of the Company’s TSR against the TSR of two comparator groups namely, (i) a bespoke peer group TSR and (ii) the FTSE EPRA/NAREIT Developed Europe Index.

2018 Contingent LTIP Award: to be awarded for the three year performance period ending 31 August 2020.

Executive Directors will receive an LTIP award over shares worth 200 per cent of salary, with the relevant performance targets being based on underlying distributable earnings per share (50 per cent), relative TSR (25 per cent) and relative total property return (25 per cent) all measured over a three year performance period. These measures are intended to align the awards with the Company’s strategic objectives and with shareholder interests. In particular: (a) the EPS measure is designed to incentivise distribution growth to shareholders; (b) the relative TSR measure (retained from the previous policy but with a reduced weighting) measures the total shareholder return of the Company against an appropriate index, and provides a direct link between shareholder returns and compensation; and (c) the relative total property return measure is designed to incentivise the enhancement of portfolio quality and distribution growth. Targets for these measures are set out on page 89.

Non‑executive Director remunerationThe table below shows the fee structure for Non-executive Directors for 2018.

2017 fees 2018 fees

Chairman of the Board £94,500 £98,000Audit and Risk Committee chair fee £50,500 £52,000Remuneration Committee chair fee £50,500 £52,000Investment Committee chair fee £50,500 £52,000Basic non-executive fee £43,000 £45,000

It is acknowledged that Non-executive Director fees remain below market average. Increases take effect from 1 September 2017. Aggregate fees for seven Non-executive Directors amounts to £389,000.

The Nominations Committee has reported on its search for a new independent Non-executive Director. It is hoped that an appointment will be made before the end of the year, which will result in aggregate fees for the Non-executive Directors totalling £434,000 p.a. This exceeds the current £420,000 aggregate limit set out in the Articles of Association and therefore a resolution will be proposed at the AGM on 25 January 2018 to amend the limit of fees to £500,000 p.a.

Annual General MeetingThe full remuneration report for the financial year ended 31 August 2017 can be found on pages 86 to 91.

The RemCo recommends the remuneration report to shareholders and hopes that shareholders will support the resolution at the AGM on 25 January 2018.

Michael FarrowChair of the Remuneration Committee

26 October 2017

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Policy report on remuneration (Not subject to audit)

Remuneration Policy for the Chairman and Non‑executive DirectorsRemuneration comprises an annual fee for the Chairman and for Non-executive Directors. Additional fees may be given at the discretion of the Board, for specific roles such as the chair of the Audit and Risk, Remuneration and Investment Committees. All fees are paid in Sterling.

Component Purpose Operation Maximum potential value Termination

Annual fee A fixed market competitive fee to attract and retain non-executives of sufficient quality to constructively challenge the executives in delivering the Group’s strategy.

The Remuneration Committee reviews the fees periodically compared with a peer group, taking into account the time spent, company size, ownership, sector, risk and other company specific factors. Its recommendations are then presented to the Board for final approval.

Fees of the Non-executive Directors (other than alternative Directors) are determined by the Board, provided that such sums do not exceed in the aggregate £420,000(1) or as the Company may by ordinary resolution approve.

Directors are not appointed for a specified term but are appointed for a term which expires when either the Director is (i) not re-appointed following retirement in accordance with the Articles of Association; (ii) removed or vacates office; (iii) resigns or does not offer themselves for re-election; or (iv) terminates their appointment on three months’ notice. There is no provision for loss of office payments.

(1)It should be noted that a resolution will be proposed at the AGM on 25 January 2018 to increase the limit of fees to £500,000.

The Non-executive Directors do not receive remuneration other than fees but are entitled to be paid all reasonable travelling, hotel and other expenses properly incurred in attending meetings of the Board, committees of the Board, general meetings or otherwise in connection with the business of the Company.

Letters of Appointment Each Non-executive Director has a Letter of Appointment, the terms and conditions of which are available for inspection at the Company’s registered office.

Remuneration policy for the Executive DirectorsThe key principles of the executive remuneration policy are to attract, retain and motivate to ensure the long term success of the Company. Performance measures and targets for incentive awards are selected so as to provide alignment with our key strategic goals. A summary of the elements of the executive remuneration policy is shown overleaf.

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Directors’ reportRemuneration – unaudited

Policy report on remuneration continued

Summary of the Executive Remuneration Policy, approved by shareholders at the AGM held on 23 January 2017

Component Purpose Operation Maximum potential value Applicable performance measures Claw back Exit payments

Base salary A fixed market competitive remuneration base to attract and retain executives of sufficient quality to deliver the Group’s strategy.

Normally reviewed annually with changes effective 1 September. However the Company is under no obligation to award an increase following the review.

No maximum salary is set.

Increases are dependent on the results of the annual review, and are normally in line with the average increase for the wider work force, inflation and market data. However, increases may be made above this level at the RemCo’s discretion to take account of individual circumstances such as an increase in scope and responsibility or to reflect the individual’s development and performance in a role or for alignment to a market level.

None None Termination of the service contract can be given by either party by way of notice in writing for a period not exceeding 12 months. Payment may be given in lieu of notice, subject to the Company’s sole and absolute discretion, up to a maximum of one year’s basic salary. There is no provision in the contracts for loss of office payments, other than those required by employment law.

Pension Part of the overall package providing comprehensive remuneration and retirement benefits.

The Company contributes monthly to the Directors’ personal pension plans. At the Company’s discretion, a cash allowance of equivalent value may be offered.

The Company contributes between 9% and 12.5% of their base salary.

Values vary by Directors and are reviewed periodically.

None None Payments would cease on the leaving date.

Other benefits Part of the overall package providing comprehensive remuneration.

• Life assurance• Private medical insurance• Incapacity• Season ticket allowance• Directors’ and officers’ insurance• Car allowance• Other benefits may be provided as appropriate

As the costs of providing benefits will depend on a Director’s individual circumstances, the RemCo has not set a monetary maximum.

None None All benefits would cease on the leaving date.

Bonus – STIP A short term incentive to reward executives on their personal performance and the Company’s performance in line with shareholder returns.

Performance will be assessed in line with specific KPIs, 75% of the award will focus on financial measures and 25% on personal objectives. The purpose of the personal objectives is to encourage leadership, loyalty of staff and to communicate with stakeholders, particularly shareholders, in a transparent manner.

Designed to offer an annual bonus of between 0% to 150% of the executives’ base salary. Payable in cash and deferred shares.

40% of award to be settled in shares, subject to a two year deferral period.

An executive is entitled to dividends on shares under the STIP award which will accrue over the deferral period and will be paid on vesting.

KPIs are based on:

• 15% operating cash flow;• 30% underlying distributable earnings;• 30% adjusted NAV growth; and• 25% personal objectives.

The financial KPIs (1-3) are calibrated according to the level of budget met:

• Less than 90% budget – nil;• Meeting budget – 75%; and• 120% of budget – 150%.

The deferred shares are subject to a two year deferral period conditional only upon continued employment (subject to the RemCo’s discretion such as in the event of long term illness or death).

If the employment of an executive is terminated for any reason or if he is under notice of termination (whether given by the executive or the Company) at or before the date when a bonus might otherwise be payable, he will have no right to receive a bonus or time apportioned bonus, save that the RemCo will have discretion to award a time apportioned bonus to a Good Leaver for the year of cessation.

LTIP award A long term incentive to align the executives’ interests with those of the shareholders and to promote the long term success of the Company.

Structured as a rolling annual award of performance shares with a three year performance period.

Awards are granted as:

• nil cost options to acquire shares; or• contingent rights to receive shares.

Such awards may carry award dividends entitling the executive to dividends which would have been received on the vested shares during the vesting period, payable either in cash or ordinary shares.

• The aggregate number of shares which may be awarded may not exceed 23,000,000 over the ten year life of the LTIP.

• Individual awards in any financial year shall not be greater than 200% of the executive’s base salary, but in exceptional circumstances an award can be made up to 400% of the executive’s base salary, providing that such an award does not exceed 7,000,000 shares.

Awards will vest at the end of a three year period dependent on the following performance conditions:

• 50% of the award is to be linked to underlying distributable earnings per share. 25% of the award will vest upon attaining earnings per share comparable with the immediate preceding financial year, with 100% vesting achieved for average annual outperformance of CPI during the performance period of 1%;

• 25% of the award to be linked to FTSE EPRA/NAREIT Developed Europe Index performance. 25% of the award will vest for median performance with 100% vesting achieved for upper quartile performance; and

• 25% of the award to be linked to the relative total property return of the Company’s UK assets in comparison to IPD UK All Property Index.

• 25% of the award will vest once performance reaches that of the benchmark with 100% vesting achieved for 2% outperformance.

In circumstances where an error has been made in determining the extent to which the performance conditions were met, financial results have been materially mis-stated or the executive has contributed to serious reputational damage to the Company or engaged in serious fraud or misconduct, the RemCo, in its absolute discretion, may determine that an award will cease or lapse or impose further conditions on the award.

If the executive leaves employment of the Company other than as set out below, the award will lapse or cease to be exercisable on the leaving date.

If the executive leaves employment for reasons such as ill health, redundancy or retirement (or any other reason at the discretion of the RemCo) or in the event of a takeover, scheme of arrangement, demerger or winding up of the Company, the RemCo, acting fairly and reasonably, will determine whether and to what extent a performance target shall then be deemed to be satisfied. Subject to that determination, the award will vest in proportion to the extent of the vesting period which has expired at the date of the relevant event.

In the event that an executive is not re-elected by shareholders at an annual general meeting of the Company, the vesting of any awards will be subject to the discretion of the RemCo.

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Summary of the Executive Remuneration Policy, approved by shareholders at the AGM held on 23 January 2017

Component Purpose Operation Maximum potential value Applicable performance measures Claw back Exit payments

Base salary A fixed market competitive remuneration base to attract and retain executives of sufficient quality to deliver the Group’s strategy.

Normally reviewed annually with changes effective 1 September. However the Company is under no obligation to award an increase following the review.

No maximum salary is set.

Increases are dependent on the results of the annual review, and are normally in line with the average increase for the wider work force, inflation and market data. However, increases may be made above this level at the RemCo’s discretion to take account of individual circumstances such as an increase in scope and responsibility or to reflect the individual’s development and performance in a role or for alignment to a market level.

None None Termination of the service contract can be given by either party by way of notice in writing for a period not exceeding 12 months. Payment may be given in lieu of notice, subject to the Company’s sole and absolute discretion, up to a maximum of one year’s basic salary. There is no provision in the contracts for loss of office payments, other than those required by employment law.

Pension Part of the overall package providing comprehensive remuneration and retirement benefits.

The Company contributes monthly to the Directors’ personal pension plans. At the Company’s discretion, a cash allowance of equivalent value may be offered.

The Company contributes between 9% and 12.5% of their base salary.

Values vary by Directors and are reviewed periodically.

None None Payments would cease on the leaving date.

Other benefits Part of the overall package providing comprehensive remuneration.

• Life assurance• Private medical insurance• Incapacity• Season ticket allowance• Directors’ and officers’ insurance• Car allowance• Other benefits may be provided as appropriate

As the costs of providing benefits will depend on a Director’s individual circumstances, the RemCo has not set a monetary maximum.

None None All benefits would cease on the leaving date.

Bonus – STIP A short term incentive to reward executives on their personal performance and the Company’s performance in line with shareholder returns.

Performance will be assessed in line with specific KPIs, 75% of the award will focus on financial measures and 25% on personal objectives. The purpose of the personal objectives is to encourage leadership, loyalty of staff and to communicate with stakeholders, particularly shareholders, in a transparent manner.

Designed to offer an annual bonus of between 0% to 150% of the executives’ base salary. Payable in cash and deferred shares.

40% of award to be settled in shares, subject to a two year deferral period.

An executive is entitled to dividends on shares under the STIP award which will accrue over the deferral period and will be paid on vesting.

KPIs are based on:

• 15% operating cash flow;• 30% underlying distributable earnings;• 30% adjusted NAV growth; and• 25% personal objectives.

The financial KPIs (1-3) are calibrated according to the level of budget met:

• Less than 90% budget – nil;• Meeting budget – 75%; and• 120% of budget – 150%.

The deferred shares are subject to a two year deferral period conditional only upon continued employment (subject to the RemCo’s discretion such as in the event of long term illness or death).

If the employment of an executive is terminated for any reason or if he is under notice of termination (whether given by the executive or the Company) at or before the date when a bonus might otherwise be payable, he will have no right to receive a bonus or time apportioned bonus, save that the RemCo will have discretion to award a time apportioned bonus to a Good Leaver for the year of cessation.

LTIP award A long term incentive to align the executives’ interests with those of the shareholders and to promote the long term success of the Company.

Structured as a rolling annual award of performance shares with a three year performance period.

Awards are granted as:

• nil cost options to acquire shares; or• contingent rights to receive shares.

Such awards may carry award dividends entitling the executive to dividends which would have been received on the vested shares during the vesting period, payable either in cash or ordinary shares.

• The aggregate number of shares which may be awarded may not exceed 23,000,000 over the ten year life of the LTIP.

• Individual awards in any financial year shall not be greater than 200% of the executive’s base salary, but in exceptional circumstances an award can be made up to 400% of the executive’s base salary, providing that such an award does not exceed 7,000,000 shares.

Awards will vest at the end of a three year period dependent on the following performance conditions:

• 50% of the award is to be linked to underlying distributable earnings per share. 25% of the award will vest upon attaining earnings per share comparable with the immediate preceding financial year, with 100% vesting achieved for average annual outperformance of CPI during the performance period of 1%;

• 25% of the award to be linked to FTSE EPRA/NAREIT Developed Europe Index performance. 25% of the award will vest for median performance with 100% vesting achieved for upper quartile performance; and

• 25% of the award to be linked to the relative total property return of the Company’s UK assets in comparison to IPD UK All Property Index.

• 25% of the award will vest once performance reaches that of the benchmark with 100% vesting achieved for 2% outperformance.

In circumstances where an error has been made in determining the extent to which the performance conditions were met, financial results have been materially mis-stated or the executive has contributed to serious reputational damage to the Company or engaged in serious fraud or misconduct, the RemCo, in its absolute discretion, may determine that an award will cease or lapse or impose further conditions on the award.

If the executive leaves employment of the Company other than as set out below, the award will lapse or cease to be exercisable on the leaving date.

If the executive leaves employment for reasons such as ill health, redundancy or retirement (or any other reason at the discretion of the RemCo) or in the event of a takeover, scheme of arrangement, demerger or winding up of the Company, the RemCo, acting fairly and reasonably, will determine whether and to what extent a performance target shall then be deemed to be satisfied. Subject to that determination, the award will vest in proportion to the extent of the vesting period which has expired at the date of the relevant event.

In the event that an executive is not re-elected by shareholders at an annual general meeting of the Company, the vesting of any awards will be subject to the discretion of the RemCo.

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Annual report on remuneration The information provided in this part of the Directors’ Remuneration Report will detail how the remuneration policy has been implemented during the year ended 31 August 2017. This report, together with the Chairman’s annual statement, will be subject to an advisory shareholder vote at the Annual General Meeting to be held on 25 January 2018.

Non‑executive fees Single total figure of remuneration for Non‑executive Directors (Audited)The table below shows the remuneration paid to all Non-executive Directors who served during the financial year ending 31 August 2017, with a comparable annual fee figure for the financial year ending 31 August 2016. The Non-executive Directors do not receive any other remuneration other than fees but are entitled to be paid all reasonable travelling, hotel and other expenses properly incurred in attending meetings of the Board, committees of the Board, general meetings or otherwise in connection with the business of the Company.

Annual fees Annual fees Actual fees 2016 2017 paid for 2017

Greg Clarke (Chairman) 88,000 94,500 94,500Michael Farrow (chair of the Remuneration Committee) 45,000 48,000 (£50,500 from 1/12/2016) 49,875Gavin Tipper (chair of the Audit and Risk Committee) 47,500 50,500 50,500Sue Ford 40,000 43,000 43,000Robert Orr (chair of the Investment Committee) 40,000 43,000 (£50,500 from 1/12/2016) 48,625Marc Wainer 40,000 43,000 43,000Bernie Nackan 40,000 43,000 43,000Total 340,500 365,000 (£375,000 from 1/12/16) 372,500

Payments to past Directors and for loss of office (Audited)There were no Director resignations during the year. There were no payments to former Directors during the year.

Executive salaries Single total figure of remuneration for Executive Directors (Audited)The table below shows remuneration paid to the Executive Directors during the financial year ending 31 August 2016 and 2017:

Annual bonus payable in Total Annual bonus respect of the remuneration payable in financial year received for Year ending Actual Taxable respect of the – deferred Shares year ended 31 August salary paid Pension benefits(1) financial year shares vesting 31 August

Mike Watters 2017 391,000 48,875 31,653 285,919 190,612 0 948,059 2016 372,383 46,548 13,297 204,810 n/a 0 637,038Stephen Oakenfull 2017 278,100 25,029 8,239 203,360 135,574 0 650,302 2016 241,080 21,697 7,578 132,594 n/a 0 402,949Adrian Horsburgh 2017 253,100 22,779 10,459 185,080 123,386 0 594,804 2016 241,080 21,697 11,750 132,594 n/a n/a 407,121Donald Grant 2017 235,200 21,168 7,962 171,990 114,660 n/a 550,980 2016 224,000 20,160 8,351 123,200 n/a n/a 375,711

(1) Taxable benefits include the provision of private medical insurance, season ticket allowances and £17,000 car allowance (CEO only).

Mike Watters served as a Non-executive Director of Redefine Properties Limited until February 2017, for which he received a net amount of R134,500 (circa £7,000) for the period 1 September 2016 to 27 February 2017.

Mike Watters served as a Non-executive Director of International Hotel Properties Limited during the year for which he received £1,299.96.

Directors’ reportRemuneration

Annual report on remuneration

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Executive bonus (Audited)The maximum bonus for the year ended 31 August 2017 was capped at 150 per cent of annual base salary, 40 per cent of any bonus is deferred in shares.

Bonuses are based on the performance against three financial KPIs and each individual’s personal objectives, apportioned as follows:

• 25 per cent personal objectives;• 15 per cent operating cash flow;• 30 per cent underlying earnings; and • 30 per cent adjusted NAV.

The personal objectives award is at the RemCo’s discretion and is designed to encourage leadership, loyalty of staff and communication with stakeholders and shareholders in a transparent manner. In reaching their decision the RemCo considered the Capital Markets Day held in February, at which the Company communicated to shareholders clear and measurable medium term strategic targets. The Executives have demonstrated strong leadership and clear conviction in executing the strategy throughout the year resulting in tangible progress across all areas. Key personnel have been retained and there has been a low staff turnover. An increased time commitment and prominence given to CSR matters, has resulted in the Company’s improved GRESB rating. A table illustrating the executives’ performance against the Bonus KPIs and strategy can be found on page 81.

The financial KPIs are compared to the Board approved budget as follows:

Level of budget met Bonus awarded (% of respective weighting)

Less than 90% budget NilMeeting budget 50%120% of budget 100%

The actual target ranges for 2017 for the financial performance measures have not been disclosed. This is considered by the Board to be commercially sensitive as certain aspects could be considered to constitute a profits forecast. Retrospective disclosure of the target ranges will be made in next year’s annual report on remuneration once the information is no longer considered commercially sensitive.

Personal KPI Cash flow Earnings NAV growth objectives Total

Weight of bonus award 22.5% 45% 45% 37.5% 150%2017 Performance: % of maximum payout achieved 100% 50% 100% 85% Award to all executives: % of salary 22.5% 22.5% 45% 31.9% 121.9%

Disclosure of 2016 annual bonus financial performance targetsThe RemCo is committed to publishing the financial performance targets once they cease to be commercially sensitive. The financial performance targets that applied in respect of the year ended 31 August 2016 are no longer commercially sensitive; accordingly, the targets and the Company’s performance against these targets are now set out below.

The 2016 annual bonus awards were based 75 per cent on financial performance and 25 per cent on the individual’s performance during the year.

% of payout of Actual this element Weighting Target range performance of the bonus

Cash flow 15% (£0.7m) – (£0.4m) £9.9m 100%Earnings 30% 2.9p – 3.8p 3.2p 50%NAV growth 30% 2.8% – 3.7% (2.3%) 0%

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Long Term Incentive Plans (Audited)On 25 January 2017, the Executive Directors received an LTIP award over shares worth 200 per cent of salary in relation to their 2017 remuneration package. These awards are subject to the performance targets of the New Policy approved by shareholders at the AGM on 23 January 2017 measured over a three year performance period from 1 September 2016 to 31 August 2019. The award price is based on the share price at close of trading on 1 September 2016.

The following contingent awards were made to Directors for 2015, 2016 and 2017 financial years:

2017

PSP contingent awards

Award price

Value of award(1)

Basis on which award was made Date of grant

Performance period

Performance conditions applicable (policy approved at 2017 AGM)

Vesting level achieved

Mike Watters

1,698,440 43.85p 774,766 200% of base salary

25 January 2017

Measured over the financial years ending:

• 31 August 2017

• 31 August 2018

• 31 August 2019

Vesting subject to the attainment of the performance targets being based on:

• 50% underlying earnings per share;

• 25% relative TSR; and

• 25% relative total property return.

Awards will vest on 25 January 2020Stephen

Oakenfull1,099,567 43.85p 482,160

Adrian Horsburgh

1,099,567 43.85p 482,160

Donald Grant

1,021,665 43.85p 448,000

2016

PSP contingent awards

Award price

Value of award(1)

Basis on which award was made Date of grant

Performance period

Performance conditions applicable (policy approved at 2015 AGM)

Vesting level achieved

Mike Watters

1,698,515 52.2p 886,625(1) 250% of base salary

28 October 2015

Measured over the financial years ending:

• 31 August 2016

• 31 August 2017

• 31 August 2018

Vesting subject to the attainment of certain targets relating to the performance of the Company’s TSR against the TSR of two comparator groups, each weighted at 50%:

• bespoke peer group TSR; and

• EPRA/NAREIT TSR.

Awards will vest on 28 October 2018Stephen

Oakenfull1,099,617 52.2p 574,000(1)

Adrian Horsburgh

1,099,617 52.2p 574,000(1)

Donald Grant

1,072,797 52.2p 560,000(1)

2015

PSP contingent awards

Award price

Value of award(1)

Basis on which award was made Date of award

Performance period

Performance conditions applicable (policy approved at 2015 AGM)

Vesting level achieved

Mike Watters

1,773,250 50p 886,625 250% of base salary

3 February 2015

Measured over the financial years ending:

• 31 August 2015

• 31 August 2016

• 31 August 2017

Vesting subject to the attainment of certain targets relating to the performance of the Company’s TSR against the TSR of two comparator groups, each weighted at 50%:

• bespoke peer group TSR; and

• EPRA/NAREIT TSR.

0% Vesting

Stephen Oakenfull

1,148,000 50p 574,000 250% of base salary

Adrian Horsburgh

478,333 50p 239,167 104% of base salary

(1) It should be noted that awards made prior to 2016 are based on 250 per cent of the current salary. Awards made in 2016 and subsequently are based on the previous years’ salary and were awarded at the share price on the first day of the performance period.

Directors’ reportRemuneration

Annual report on remuneration continued

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Awards cannot be made during closed periods and therefore awards are not granted until a closed period has ended.

The awards will vest three years from the date of grant subject to continued employment and the satisfaction of performance targets.

The figures above reflect the maximum number of shares that may vest. The actual number to vest will be dependent on performance against comparator targets over the applicable performance period.

2015 and 2016 awards vesting scheduleThe 2015 and 2016 awards are subject to the LTIP policy approved by shareholders at the 2015 AGM and will be measured against two total shareholder return related performance targets:

• 50 per cent of any such award will be subject to a performance target which measures the Company’s TSR relative to that of the members of a bespoke comparator group; and

• 50 per cent of the award will be subject to a performance target which measures the Company’s TSR relative to that of each of the members of EPRA/NAREIT Developed Europe Index.

The 2015 and 2016 awards are subject to the following vesting schedule:

Relative TSR performance Percentage of one half FTSE EPRA/NAREIT of an award that vests

Upper quartile 100%Between median and upper quartile Between 25% and 100%Median 25%Below median 0%

2017 awards vesting scheduleThe 2017 awards are subject to the LTIP policy approved by shareholders at the 2017 AGM with the relevant performance targets measured over a three year period being based on:

• 50 per cent on underlying earnings per share;• 25 per cent on relative TSR; and • 25 per cent on relative total property return.

The 2017 awards are subject to the following vesting schedule which forms part of our shareholder approved New Policy:

Performance condition Applicable measure Vesting thresholds

Growth in underlying earnings per share Immediately preceding financial year earnings per share • 25% on attaining previous earnings per share• 100% on achieving average annual outperformance

of CPI plus 1%• Straight line vesting between 25% and 100%

Relative TSR FTSE EPRA/NAREIT Developed Europe Index • 25% on achieving median performance• 100% on achieving upper quartile performance• Straight line vesting between 25% and 100%

Relative total property return of the UK portfolio IPD All Property Index • 25% for performance in line with IPD• 100% achieved for 2% outperformance• Straight line vesting between 25% and 100%

The RemCo may adjust (upward or downwards) the extent to which a LTIP award would otherwise vest if it considers that such level of vesting is not reflective of overall corporate performance or of the executives’ personal performance.

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Redefine International P.L.C. Annual Report 201790

Directors’ reportRemuneration

Annual report on remuneration continued

Statement of Directors’ shareholdings and share interests (Audited)Although there is no requirement for Directors to own shares in the Company, the table below shows the total number of Directors’ interests in shares as at 31 August 2017.

2017 Bonus deferred LTIP share shares LTIP share awards due awarded awards due to vest on 28 due to vest on to vest on 25 Number of October 2018 1 September January 2020 ordinary shares subject to 2019 subject subject to held as at % of issued performance to continued performance 31 August 2017 share capital conditions employment conditions Total

Mike Watters (CEO) 6,515,638(2) 0.36 1,698,515 476,292 1,698,440 10,388,885Stephen Oakenfull (Deputy CEO) 623,536(3) 0.03 1,099,617 338,766 1,099,567 3,161,486Adrian Horsburgh 62,189 0.00(1) 1,099,617 308,311 1,099,567 2,569,684Donald Grant 50,000 0.00(1) 1,072,797 286,507 1,021,665 2,430,969Gavin Tipper 508,630 0.03 508,630Marc Wainer 1,680,364(4) 0.09 1,680,364(4)

Bernard Nackan 20,911 0.00(1) 20,911Robert Orr 23,529 0.00(1) 23,529Total 9,484,797 0.52 20,784,458

(1) Less than 0.001 per cent.(2) Mike Watters’ shares are held through a pension fund structure.(3) 573,536 of Stephen Oakenfull’s shareholding is held in his wife’s name.(4) Marc Wainer’s beneficial interest is held through 127,593 shareholding in his wife’s name, 175,000 shareholding held through his Drawood Trust and 2,755,541 shareholding

in Ellwain Investments (Pty) Limited of which he is a 50 per cent shareholder.

Changes to Directors’ shareholding since 1 September 2017 and up to the date of this document can be found on page 93 of this Annual Report.

CEO comparable performanceTotal remuneration figure for CEO since the internalisation of management in 2013The table below shows the total remuneration figure for the CEO for the years since the internalisation of management in December 2013.

Annual bonus awarded For the as a percentage year ending Total of the maximum LTIP 31 August remuneration possible award awards

Mike Watters 2017 948,059 81% 0%Mike Watters 2016 637,038 55% 0%Mike Watters 2015 606,647 55% n/aMike Watters (appointed CEO 3 December 2013) 2014 490,600 55% n/a

Performance graph and CEO remuneration tableThe table below illustrates the performance of the Company, since the merger of Wichford P.L.C. and Redefine International plc in August 2011. This is measured against the performance of EPRA and the FTSE All Share index, both of which the Company is a constituent.

250

200

150

100

50

0 Aug 2011

penc

e

Redefine International FTSE All Share EPRA Index (Sterling)

Aug 2017 Feb 2017 Feb 2012 Aug 2012 Feb 2013 Aug 2013 Feb 2014 Aug 2014 Feb 2015 Aug 2015 Feb 2016 Aug 2016

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Percentage change in remuneration of CEO Pursuant to the salary reviews on 1 September 2017 the following increase in base salary, benefits and bonus (relative to prior year base salary, benefits and bonus) is compared for the CEO and those employees of the Company’s head office who were determined to be the most appropriate benchmark, due to the nature and location of the Company’s residual workforce.

2017 Salary(1) Benefits(2) Bonus(3)

Base salaryMike Watters +4.0% +138.0% +132.7%Average employee per capita figure +4.6% +1.0% +11.2%

(1) The base salary comparison is in relation to the 1 September 2017 salary review.(2) The benefits comparison is in relation to benefits for 2017 financial year compared to 2016.(3) The bonus comparison is in relation to bonus for 2017 performance compared to bonus for 2016 performance.

£51.8m-2.5%

£66.1m+736.7%

£6.5m-23%

% – percentage change

Profits after taxStaff costs Dividends

2017

0

10

20

30

40

50

60

70

£7.9m

£53.1m

£8.5m

£m

2016

Relative importance of spend on pay

Consideration by the Directors of matters relating to Directors’ remunerationThe Directors who have served on the RemCo during the reporting year can be found on page 78.

No executives attend formal meetings of the RemCo.

Deloitte replaced Willis Towers Watson as the Company’s remuneration advisers during the financial year. Deloitte is a member of the Remuneration Consultants’ Group and have no connection with the Company. The RemCo is satisfied that the advice received has been objective and independent.

Total fees paid to Deloitte during the financial year were £13,460 (Willis Tower Watson fees were £28,909 (2016: £45,530). All advice received was duly considered by the RemCo, and their proposals presented to the Board for final approval.

Statement of voting at the Annual General MeetingAt the Company’s AGM held on 23 January 2017, the Directors’ remuneration report for the year ended 31 August 2016 was approved by shareholders. The results were as follows:

Votes Votes Votes Resolution for % against % withheld(1)

To approve the Directors’ remuneration report for the year ended 31 August 2016 1,246,629,118 99.57 5,375,309 0.43 9,225,003To approve and adopt the new Remuneration Policy 1,000,333,466 79.91 251,542,808 20.09 9,433,156

ApprovalThis report was approved by the Board of Directors on 26 October 2017 and signed on its behalf by:

Michael FarrowChairman of the Remuneration Committee

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Directors’ report

Redefine International P.L.C. Annual Report 201792

The Directors’ report comprises pages 60 to 94 together with certain sections of the Annual Report incorporated by reference as outlined below:

• future developments and the outlook for the Company are contained in the CEO report on pages 4 to 6;• important events that have taken place since the end of the financial year are described on page 147;• details of financial instruments, and the financial risk management objectives and policies of the Company are detailed in pages 140 to 143;• principal risks and uncertainties pertaining to the Group and the way in which it manages and controls these risks are outlined in the

Strategic Report on pages 16 and 17;• the Company’s three year viability statement can be found on page 17;• disclosures regarding the employment of disabled people and employee involvement are contained in the corporate social responsibility

report on page 49, although it should be noted that the Company employs less than 250 people;• diversity policy for the Group is on page 49. In addition, it should be noted that the Nominations Committee is seeking to expand the female

membership of the Board to at least one third by 2020; and• greenhouse gas reporting is included in the corporate social responsibility report on page 58.

Results and proposed dividendsThe Group statement of comprehensive income is set out on page 100 and shows a profit attributable to equity holders of the Parent of £78.7 million.

The Board has declared a second interim dividend of 1.3 pence per share, or a scrip alternative. Dispatch of share certificates or the cash dividend will be paid on 18 December 2017 to those shareholders on the register as at 1 December 2017, and will result in a total dividend of 2.6 pence per share for the financial year.

Going concernAt 31 August 2017 the Group’s cash and undrawn committed facilities were £63.4 million and its capital commitments were £16.8 million. Weighted average debt maturity of 7.3 years and LTV adjusted for events occurring up until the day of signing this year’s Annual Report was of 50.0 per cent, which provides sufficient headroom against financial covenants. Attention is also drawn to the viability statement contained within the Group’s principal risk disclosures on pages 16 and 17.

After considering severe but plausible scenarios, the Directors are satisfied that there continues to be a reasonable expectation that the Group will have the resources it requires to meet on-going and future commitments. Accordingly, the 2017 financial statements have been prepared on a going concern basis.

Issued share capitalAs at 31 August 2017 the Company’s total issued share capital was 1,828,060,146 ordinary shares of 8.0 pence each. Increases in the issued share capital during the year have resulted from the following:

Date Reason for issue Shares issued Total

1 September 2016 Start of the financial year — 1,794,598,65012 December 2016 Scrip dividend 17,141,172 1,811,739,82226 June 2017 Scrip dividend 16,320,324 1,828,060,146

Further details of the authorised and issued share capital are shown in Note 25 to the financial statements. Redefine International has one class of share; all shares rank equally and are fully paid.

Voting rights and restrictions of transfers of sharesShareholders are entitled to receive notice of, to attend and to vote at, all general meetings of the Company. Further details on the voting rights of shareholders can be found in the Company’s Articles, available on the website www.rdireit.com.

There are no specific restrictions on the size of shareholding nor on the transfer of ordinary shares imposed by the Articles of Association of the Company.

Other than in connection with the 150 million Euro secured exchangeable bonds issued by Redefine Properties Limited in September 2016, exchangeable into shares of Redefine International P.L.C. (the “Exchange Property”) and connected stock lending agreements, that may result in restrictions on the transfer of securities or on voting rights in connection with the Exchange Property, the Company is not aware of any agreements between holders of securities that may result in restrictions on the transfer of securities or on voting rights.

Additional disclosures to the Directors’ report

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Purchase of own shares and shares in TreasuryAt the 2017 AGM, shareholders granted the Directors authority to make market purchases of ordinary shares in the Company in certain circumstances and to hold those shares in Treasury.

Shares were purchased by the Company in 2011, but Directors have no present intention of exercising this power. The authority to purchase shares would only be exercised after careful consideration by the Directors and as and when conditions were favourable, with a view to enhancing earnings per share and/or net asset value per share, which would be of benefit shareholders.

Legislation in the Isle of Man was enacted in 2014 which allows companies who buy their own shares to hold them in Treasury rather than cancel them, up to a maximum of 10 per cent. If the Company purchased its own shares it would therefore hold such shares as treasury shares which the Company could sell for cash. All rights attaching to shares purchased under this authority, including voting rights and rights to dividends, would be suspended whilst they were held in treasury.

During the financial year and up until the date of this document, no shares were purchased and no shares were held in Treasury.

Notified shareholdingsAs at the date of this report, the Company had been notified, or was otherwise aware, of the following persons who were directly or indirectly interested in three per cent or more of the issued share capital of the Company.

Percentage Shareholder Shareholding held

Redefine Properties Limited 539,635,248 29.52Allan Gray Asset Management 135,171,096 7.39

Dealings of Directors and their Persons Closely AssociatedThe Company adheres to a strict Share Dealing Code in line with the Market Abuse Regulations, which prohibits persons discharging managerial responsibility (“PDMR”) dealing in shares for a designated period preceding the announcement of its annual and interim financial results, or any other period considered price sensitive. PDMRs are advised of such periods, and acknowledge their obligations and potential sanctions if the obligations are breached. Dealings in shares by PDMRs are strictly monitored during the year with the necessary RNS announcements and FCA notifications being made in respect of dealings performed by PDMRs or persons closely associated with them, as required.

During the year the following Directors’ dealings occurred and were reported to the market:

Number of Number of ordinary shares ordinary shares held as at Scrip shares Acquisition Scrip shares held as at 31 August 12 December 24 February 26 June 31 August 2016 2016 2017 2017 2017

Greg Clarke — — — — —Michael Watters (CEO)(1) 6,515,638 — — — 6,515,638Stephen Oakenfull (Deputy CEO)(2) 573,536 — 50,000 — 623,536Adrian Horsburgh 10,000 347 50,000 1,842 62,189Donald Grant — — 50,000 — 50,000Michael Farrow — — — — —Gavin Tipper 508,630 — — 508,630Sue Ford — — — — —Robert Orr 23,529 — — — 23,529Marc Wainer(3) 1,680,364 — — — 1,680,364Bernard Nackan 19,610 682 — 619 20,911Total 9,331,307 9,484,797

(1) Michael Watters’ shares are held through a pension fund structure.(2) 573,536 of Stephen Oakenfull’s shareholding is held in his wife’s name.(3) Marc Wainer’s beneficial interest is held through 127,593 shareholding in his wife’s name, 175,000 shareholding held through his Drawood Trust and 2,755,541 shareholding

in Ellwain Investments (Pty) Limited of which he is a 50 per cent shareholder.

Directors’ interests in the ordinary shares, including their contingent awards and deferred bonus shares can be found in the Directors’ remuneration report on page 90 and are set out in Note 32 related party transactions.

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Directors’ report

Redefine International P.L.C. Annual Report 201794

Additional disclosures to the Directors’ report continued

Directors’ appointment and Directors’ powersSubject to the Isle of Man Companies Act 2006, the Articles of Association of the Company and any directions given by special resolution of the Company, the business of the Company shall be managed by the Board, which shall exercise all the powers of the Company whether relating to the management of the business or not.

Subject to the provisions of the Isle of Man Companies Act 2006 and the Articles of Association of the Company, the Board shall have the power to appoint a person who is willing to act as a Director, either to fill a vacancy or as an addition to the existing Board. Any Director so appointed must retire at the next AGM and put themselves forward for re-election by the shareholders.

As a Chapter 6 Company, Redefine International confirms that whilst Redefine Properties Limited is a controlling shareholder of the Company, the election or re-election of independent Directors will be conducted in accordance with the election provisions of LR 9.2.2.E and LR 9.2.2F R and approved by:

• the shareholders of the Company; and• the independent shareholders of the Company.

In addition to any power of removal conferred by the Isle of Man Companies Act 2006, the Company may by ordinary resolution remove any Director before the expiration of his period in office, and by ordinary resolution appoint another person who is willing to act as a Director in his or her place.

Significant agreementsThere are no agreements between the Company and its Directors or employees providing for compensation for loss of office or employment that occurs during a takeover bid. However, in the event of a takeover, scheme of arrangement, demerger or winding up of the Company, any awards made to the Executive Directors under the performance share plan may vest early, subject to the relevant performance targets being met and at the discretion of the Remuneration Committee.

Amendment of ArticlesThe Company’s Articles of Association may be amended by a special resolution of the Company’s shareholders. The Company’s Articles of Association were last amended on 26 January 2016.

Political donationsDuring the period Redefine International made no political donations.

Donald GrantChief Financial Officer

26 October 2017