WAMAC Corporate Governance Report 2020 VDAMAC CORPORATE GOVERNANCE REPORT OF DAMAC PROPERTIES DUBAI CO PISC FOR THE YEAR 2020 Page LWAMAC Corporate Governance Report 2020 Introduction: DAMAC Properties Dubai PJSC, (the "Company”) has a keen interest in adopting good governance standards and follows the corporate governance best practices in compliance with the Resolution no. 3/RM of 2020 concerning the Standards of Institutional Discipline and Governance of Pul Shareholding Companies (“Corporate Governance Guide”) issued by the Securities and Commodities Authority (“SCA”) and the Federal Law No (2) of 2015 on Commercial Companies as amended by Federal Decree Law No (26) of 2020 and its amendments (“Companies Law”). This report addresses the corporate governance framework at the Company, in accordance with the Corporate Governance Guide, Companies Law and SCA’s standards. 1 Statement of procedures taken to complete the corporate governance system during 2020 and method of implementing thereof: The Company's corporate governance Manual (“Corporate Governance Manual”) is produced by the Board of Directors (“Board”) in line with the Company's commitment to maintain corporate governance principles and the highest standards of corporate governance best practice to protect the interest of all shareholders, in addition to the Board’s belief that effective corporate governance is fundamental to the success of the business. The Board is committed to achieving the highest standards of corporate governance, corporate responsibility and risk management in directing and controlling the business. The Company has adopted a Corporate Governance Manual, which details the corporate governance and policies that regulate and form the basis of the Company's governance policies. The Company Corporate Governance Manual describes the role and duties of the Board’s Chairman and executive management and specifies the powers of the Board and supervision of the Company's internal systems and controls, monitoring its performance and efficiency. In particular, the Corporate Governance Manual: a) Addresses the principles and practices of governance and aims to guide the Board members/ executive management and establish formal Corporate Governance structure & practices; b) Addresses the structure and process established to oversee, direct and manage the business and affairs to achieve financial stability and enhance shareholders value; ©) Highlights the responsibilities of the Board and the Management in directing the Company to function in accordance with the Corporate Governance Manual. pageWAMAC Corporate Governance Report 2020 d) Details the policies that are to be followed without distinction or exception and employees are made personally accountable for fulfilling their responsibilities to comply with the Corporate Governance Manual. In order to achieve the above objectives, and to ensure compliance with the Corporate Governance Guide issued by SCA, the Corporate Governance Manual covers the following: 1 Board Structure and matters related to the Board of Directors; 2. Board committees; 3 External auditors; 4 Internal control systems; 5. Conflict of interest & transactions with related parties; 6 7 8 9 Company's Disclosure obligations; Shareholder rights; The Company share dealing policy; The Company whistle blowing policy; 10 The Company corporate social responsibility policy; 11 Percentage of Emiratization; and 12 Projects and Innovative Initiatives. The Board is ultimately responsible for ensuring that the Company complies with legal and regulatory obligations, the Memorandum and Articles of Association of the Company and the duties towards shareholders. The Corporate Governance process is implemented by the management and independently monitored for effectiveness by the Board and assisted by the following Board committees: 1. Audit, Compliance, and Risk Committee (“ACR Committee”) 2. Nomination and Remuneration Committee (“NRC Committee”) In addition to the above-mentioned committee(s), the Board is assisted by external and internal auditors, and Company officers and employees including the General Manager & Group Chief Financial Officer, the Compliance Officer, the Risk Officer and other members of the Management. 2 sctors’ Dealings in Company Securities: The Company has adopted a policy on Company share dealings, which sets out the requirements for dealing in Company shares by all directors, executive management and employees of the Company and prohibits dealing or trading in securities issued by the Company based on undisclosed confidential information or in violation of the law and Corporate Governance Manual. Page>DAMAC Corporate Governance Report 2020 The purpose of this policy is to educate the directors, executive management and employees on the legality of dealing in the Company's shares either directly, indirectly or through collecting unpublished price-sensitive information related to share prices, such as: + Annual and interim financial results of the Company before they are made public; + Information about Company's forecasts and trading prospects; + Dividends that Directors propose to declare and any changes to the dividends pol + Corporate restructuring programmes; * Any other information that the Company’s management may determine to be price-sensitive information; and + Set out the consequences of failure to adhere to this policy. During the closed periods, Directors, Executive Management and other employees are not allowed to deal directly or indirectly in shares of the Company irrespective of whether or not they are in possession of unpublished price-sensitive information The closed periods commence ten (10) days prior to the announcement of any price-sensitive information or fifteen (15) days prior to the end of each financial quarter, half year or year; and continues until the formal disclosure of the significant information or publication of financial statements, as applicable, to market. All closed periods are notified to all employees through internal communication channels and employees are advised not to deal in the Company's shares during closed periods. The Board and the individual directors, as well as the Company management, understand their obligations with respect to the disclosure requirement in connection with their dealings in the Company securities and are compliant with all requirements set by SCA and DFM. All Board members have confirmed that neither they nor their first-degree relatives have traded in the Company's securities during the year 2020. Below is a statement of ownership and transactions of Board of Directors members, their spouses and their children in the Company securities during 2020: S/N Name Position /Kinship | Owned shares ason | Totalsale | Total 31/12/2020 purchase 1__| Mr. Hussain Sajwani Chairman Indirectly 72.22% | _Nil Nil 2M. Farooq Arjomand | Vice Chairman Nil 3_| Mr. Sofyan Al Khatib Board Member Nil 4 | Mr. Ali Binjab Board Member Nil 5 | Mr. Yahya Nooruddin | Board Member Nil | PageDAMAC Corporate Governance Report 2020 * Mr. Adel Tagi and Mr. John Wright left the Board of Directors in 2020. Then a general assembly ‘meeting was held for the Company on 14/05/2020 under which a special resolution was issued to reduce the number of members of the Board of Directors so that the number of members became (5) instead of (7). Mr. Nabil Al-Yousuf left the Board of Directors in 2020, and Mr. Ali Malallah Binjab was appointed as a member of the Board of Directors instead. Mr. Taqi, Mr. Wright, Mr. Al Yousuf, and any of their spouses and children did not have any owned shares or dealings in the Company's shares during their presence as members of the Board of Directors during the year 2020 3 Board of Directors Formati ‘A, Statement of Board of Directors Formation: The Board of Directors of the Company consists of five members according to the below table, The Chairman is a UAE national and the majority of the members are non-executive and independent in consistency with the Corporate Governance Guide. ame | Board Postion | Experience | Gualiestion | Tenure with the | Membership/ | PosRionsn any other (Geecutive, | (Years) ‘Company as | postonsin any | important regustory, non-executive | oard Member | otherJoint | governmental or commercial Independent) from the date Stock Tocatons coffietelection | companies in UAE Tar. Russian | Chairman [oa years Wore ‘Chairman oF sajwant Economics | Date of fist = Al Anwat Coram Tes Co fromthe | election 'AQG, Muscat Universty of | 12/01/2085 Allazea Services SAOG washington, USA Tw. Fareoa | Vice Chairman 35 | excrelorar | Gyeare Board member | Wone Arlomand | Non-Executive Business Date ottist | of Amiak Independent Aaminisvatio | election Finance ISC 2(8.8.A) fom | 12/01/2015, Seattle Paci Universty in the Unites States Tw. SofvanAT_| Nen-oweeutve WH | sacreiorot | Syeare None None at Non Business Date of fest, Independent Adminstravo. | election: (8.8.4) from | 14/06/2017 | University of Jorsan [Me Rtas [Won tacit 37 | wachetorat | Date ofthe | None None Independent Finance from | election Houston 23/12/2020 University in the Unites States, and Bachelor of Science in PageWDAMAC Corporate Governance Report 2020 Tosiness Adminsato | Management frome Uniecsty of Tora inthe nied states | MrYahya | Wontrecutie | 25] oeareeim | years Tone CEO at Panu Company Nocruddin | independent marine Date of est bse, Baran tngineorng, | election: Beard member, ¢snur fandmasterin. | 12/01/2015 Tataul Insurance Co, tow (KSC), Kuwait Chaka, Babin insurance Asoetion, fatran Board member - Saran Insttute of Banking and Finance Boar Meret of A | Nafees Hostal Sahain ie Chairman on ta Company Sahai. Boars ember of Venture Cpa bank, Suc arabia oard Member of Health 360 Arcllry Services W.LL, aaa ‘The brief profile of each of the Board members is provided hereinafter Hussain Sajwani - Chairman Hussain Sajwani, a UAE national, is the founder and Chairman of the Company. Sajwani is a pioneer of the property market expansion in Dubai. In the mid-90s, he built several hotels to accommodate the growing influx of people coming to the emirate to do business and trade. In 2002, he identified a growing market opportunity and established the Compnay, which has grown to become the one of the largest property development companies in the Middle East. To date, DAMAC Properties has delivered over 32,000 homes and has a development portfolio of more than 34,000 units at various stages of planning and progress. ‘As a market leader, the Company has also joined forces with some of the most recognisable lifestyle brands, to bring distinguished living concepts to the market. Projects include luxury apartments and villas with interiors by Italian fashion-houses Versace Home, Fendi Casa and Just Cavalli and the uniquely conceptualised Paramount Hotels & Resorts, which delivers living at its most opulent. ‘Asan astute businessman and investor, Sajwani also has a proven track record of successful forays into the global equity and capital markets. PagewD Cc Corporate Governance Report 2020 Under his strategic investment arm, The DICO Group (www.dicogroup.com), he currently holds investment portfolios of securities in a number of regional and global markets. DICO focuses on investments in new concepts, private equities, mergers and acquisitions and holds majority and minority holdings in publicly traded companies and industries like luxury fashion, real estate, hospitality, manufacturing and more. Today the DICO Group's global footprint extends across North America, Europe, Asia, Middle East and Africa. Sajwani resides in Dubai with his wife and four children. Alongside his family, Sajwani advocates for access to quality education under the Hussain Sajwani - DAMAC Foundation, including the Popular One Million Arab Coders an initiative that aims to empower one million Arabs with the language of the future, coding, Faroog Arjomand - Vice Chairman - Non-Executive Independent Member Mr. Arjomand received his Bachelor of Business Administration from Seattle Pacific University in the United States in 1984. Mr. Arjomand started his career as a banker at HSBC in 1985 and gained extensive experience of private banking, corporate finance, trade services and investment banking. Mr. Arjomand founded the Arjomand group of companies in 2000. The group conducts various activities including real estate, manufacturing, trade, financial activities and aviation across the GCC, *Asia, Europe and the US. Sofyan Al Khatib ~ Non-Executive Affiliated Member Mr. Al Khatib has more than 40 years of experience in the hospitality and restaurants sector in the Middle East region. He obtained his Bachelor of Business Administration (B.B.A.) from the University of Jordan in 1980. Mr. Al Khatib has previously served since 1989 as a group manager of International Logistics Services LLC, which specialised in providing comprehensive solutions in engineering services, Procurement, construction, supply services and customer support in a number of sectors including the oil and gas sector, the hospitality sector, the education sector and others. in his role, he supervised business development and operational processes of the group in the Middle East and North Africa region (MENA). Before becoming a Board member, Al Khatib held several leadership positions in a group of supply companies in Kingdom of Saudi Arabia, where he was responsible for overseeing sales and marketing activities, widening sales networks, achieving sales revenue targets and managing regional project operations. Page7rp ) Cc Corporate Governance Report 2020 Ali Biniab - Non-Executive Independent Member Mr. Binjab has extensive experience in private banking, corporate finance, commercial services and investment banking services. His long experience extends to banking, investment and trade in the United Arab Emirates, where he is currently holding the position of Senior Branch Manager at Emirates NBD. Mr. Ali received his Bachelor of Finance from Houston University in the United States, and he received his Bachelor of Science in Business Administration Management from the University of Texas. Yahya Nooruddin - Non-Executive Independent Member Mr. Nooruddin has over 25 years of experience in local and regional financial markets with a Proven track record of building organisations and leading them to the forefront of their respective industries. Mr. Nooruddin holds a degree in marine engineering and Master in law. Mr. Nooruddin is currently the Chief Executive Officer of t’azur Company, which provides Family and General Takaful products for individuals and businesses. Prior to joining t’azur Company, Mr. Noorud served 12 years as Chief Executive Officer of Al Ahlia Insurance Company. Mr. Nooruddin was appointed as assistant general manager of Bahrain Kuwait Insurance Company B.S.C. B. Statement of the percentage of female representation in the Board for 2020: The Company does not have woman representation at the Board level, however, at the organisational level, the Company does have fair amount of women representation. €. Statement of the reasons for the absence of any female candidate for the Board membership: During the last Director's election in 2020 and after opening the door for election of new Directors for the Board, two women applied for membership of the Board. in the election session held on 11/06/2020, no woman obtained a sufficient percentage of votes to become a Board member. Remuneration of the Board of Directors: According to the Corporate Governance Manual, the remuneration of Board members shall be a Percentage of net profit not exceeding 10% of the net profits. Moreover, the Company may pay ancillary expenses or fees or a monthly salary in the amount fixed by the Board to any member as approved by the General Assembly of the Company, if such a member works in an PageSwD Cc Corporate Governance Report 2020 exerts special efforts or undertakes additional duties for the Company beyond his/her normal duties as a member of the Board of the Company. In all cases, the remuneration of Board members may not exceed ten percent (10%) of net profits, having deducted all the depreciations and reserves. The Board members did not receive any remuneration for the year 2020, and there is no proposal Prepared by the Board to be submitted in the annual general assembly regarding remuneration distribution on members of Board of Directors. E. Number of Board of Directors meetings held during the financial year 2020, their dates of holding, with the personal attendance record of all directors and statement of the members who attended by proxy are as follows: Name ‘Meeting1 | Meeting2 | Meeting3 | Meeting4 | MeetingS | Meeting6 | Meeting7 | Meeting & o/enTmoat TERS SRD | HPT RRG | TORO aon | aaa | AOD Mr. Ll ‘Attended ‘Attended Attended Maison | nended | atendeg | Atenied [Atended | atended | ieee "| ¥ [remot wr Tadeo pasacg | ammnaen | acon | RSET nad] mae Faron | Anended eee Dene eee Pa, ae v | rence : a ce | a Dae |fesss al Pese cereal Pcoe Ice = etal Member_| Member | Member | Member_| Member | Member ae Aaenged] Wotrger | Rotoget| nove] Wolge | Nolo | Wo urea Se ae sous | “tone” | "aon | “aout | “tout” | “som enber_| Merier_| Member |_mnter_|_nertar_|_ ster wana | MEET Ate T preneg | acenaes | MENGES | Mtended [Aten | Wologe ‘owt foal, | ena ember we vanea | Aended | Aenged | aded | Ateded|-Atcnded | Anenled | Azden noordn renotey_ | renctsy | remotoy_| remacyy | ronoety_|_ seman ie | Airaid | Aantal | Rene] canna] enced |Rencos | ended] tender Sofyan Al remotely - a remotely | remotely Khatib —_| remviety sae | S| Rf Nera] — ere] — eta noes 7 or wr ad |e Board Board Board Board Board Board | Member _ Member Member Member Member, Member Member F. Number of the Board resolutions issued by passing during the 2020 fiscal year, along with its meeting convention dates: ‘The Board issued a resolution by passing on 16/04/2020 which included changing the date of the General Assembly meeting to 07/05/2020 instead of 16/04/2020. PageWAMAC Corporate Governance Report 2020 G. Statement of Board duties and powers exercised by Board members or the executive management members during 2020 based on an authorisation from the Board, specifying the duration and validity of the authorisation Pursuant to the Articles of Association of the Company, and by virtue of various Board resolutions, the Board of Directors have delegated to the Audit Compliance and Risk Committee; and Nomination and Remuneration Committee; and the General Manager; the authority to conduct the business of the Company and to carry out all acts, reasonably necessary to fulfill the Company's objectives. Mr. Mohammed Tahaineh has been authorised by virtue of a special power of attorney issued on 02/06/2020 and valid for a period of one calendar year, to manage the business and affairs of the Company, including, but not limited to, the following powers: ~ To.carry out all actions, deeds and things on behalf of the Company in any matter related to the Company in the United Arab Emirates or abroad within the framework of the authority granted to him; ~ Signing, completing, making amendments, presenting, discussing and obtaining all documents that may be required, necessary or appropriate for the process of registering, renewing and amending the Company's license and/or any of its branches within the United Arab Emirates and/or opening branches within the United Arab Emirates; ~ Opening, managing, operating and closing all bank accounts inside and/or outside the United Arab Emirates, with the ability to execute all bank and cash documents and deposits, sign and collect checks, draft statement, accounts, invoices, notices and other financial instruments; - Deal with all currencies, chequess and all other negotiable instruments; ~ Representing the Company in all cases filed by all types and levels of courts and arbitration tribunals, claiming the Company's debts and providing receipts; ~ Dealing in all the Company's business and transactions, including the right to buy, rent or acquire real estate, and sell, mortgage, lease or dispose of any belonging to the Company; - Negotiate and conclude all contracts and sign all agreements and documents related to the Company's business and take all necessary steps to conclude, implement and fulfill the terms and conditions of any agreements and contracts; - Negotiate, sign and implement in the name of the Company the commitment guarantees for other "third parties" or the corresponding guarantees; ~ Implementing the Company's policies that have been approved by the Board of Directors and ‘managing all administrative work related to the Company's business; Page LOWAMAC Corporate Governance Report 2020 - Take all decisions related to the marketing and pricing of the products and services offered by the Company; = Recruiting, assigning, or terminating the services of Company employees, specifying their roles and duties, determining the duration of their services, their wages, salaries and bonuses; - Appointing or terminating lawyers, accountants, and other consultants and advisors in the Company, determining the scope of their work, negotiating and determining their fees and other conditions for their appointment; = Appointing lawyers to represent the Company in the courts, arbitration, or any other alternative body to resolve the dispute to initiate procedures, to plead, to enforce, and to take all actions related to any of the aforementioned issues; and - Preparing, signing, executing and submitting all requests, petitions, forms or necessary documents and/or executing all official matters and required official procedures and/or attending and representing the Company before the government, the Ruler’s Court, the courts of the United Arab Emirates, notaries and various ministries, including, but not limited to, The Ministry of Economy, Municipalities, Economic Departments, Chamber of Commerce and Industry, Customs, Immigration Departments, Ministry of Labour, Police Departments, Courts, Prosecution Department, Ports, Customs and all other governmental and semi-governmental authorities or departments, all corporate institutions and all individuals and private companies in the United Arab Emirates. H. Statement of related party transactions (stakeholders) in 2020 with showing the nature of relationship and type of dealing: Nature of significant related party transactions and amounts involved are as follows: AED"000 () Investment in DAMAC Intemational Limited 55,837 (ii) Investment in Nine Elms SH Co Ltd 293,000 (ii) Support Services Fees 4,836 (iv) Acquisition of Subsidiary 9,843, {i Investment in DAMAC International Limited: The Company reduced its investment in DAMAC International Limited by AED 55.8 million, a related entity under the control of the Chairman of the Board. (ii) Investment in Nine Elms SH Co Ltd: The Company acquired (25%) stake in Nine Elms SH Co Ltd for a consideration of AED 293 million from Nine Elms S.R Co Ltd, a related entity under the control of the Chairman of the Board. rage 1DAMAC Corporate Governance Report 2020 Support services fees: The Company received AED 4.8 million towards support services rendered to DAMAC International Limited and DICO Investments Co. LLC, both related entities under the control of the Chairman of the Board. iv) Acquisition of Subsidiary: The Company acquired 100% of the issued share capital of Helios Venture Holding Limited, a company registered in the British Virgin Islands, under the control of the Chairman of the Board Poge 2DAMAC Corporate Governance Report 2020 |. Organisational structure of the Company: The organisational structure of the Company is provided hereunder: DAMAC Properties Dubai PJSC Organizational Structure { HRa Tact] | Peaseaa. | ieee | | i Taian Ca | [eat Conor || Communcatons ” jefe} Commercial | eerie ! t | ' | Legal |_pfiriematonTecnaicy| | | 1 | | SeeseSa8 Popes | | amisiaten —fae—|-p| tnfastuctires ! t I ‘Cisomer Raaiore ] | Business Planning ena] | | and development. —~™] I | — Pagel 3DAMAC Corporate Governance Report 2020 J. Detailed statement of the senior executive employees in the first and second degree and their jobs, dates of their appointment, total salaries, remunerations paid to them: Mr. Mohammed Tahaineh: He holds the position of General Manager in the Company in addition to managing its commercial affairs and projects. He holds a BS'c in Civil Engineering from the University of Jordan and has taken many management courses. Mr. Hitesh Dhoot: He manages the Company's Finance and Accounts Department. He is fellow member of Institute of Chartered Accountants of India (ICAI) and member of The Institute of Company Secretaries of India (ICSI) The below table details the senior executive management salaries and remunerations in the Company: Other cash/ Salary and inkind | Appointment | allowances | PO4825 1° | Bonuses for |] sw Designation/Manager esate for the ye ‘the year Date 2020 (in year 2020 AED) 2020 or {in AED) Payable in the future || 1 | projects and commercial 16/08/2017 | 810,000 | 111,000 N/A 2 Finance and Accounts 04/03/2014 1,080,000 N/A N/A 3. | HR and Talent Acquisition 04/12/2016 | 920,000 | 52,500 wal Marketing and Corporate WA 4 conitunications 17/10/2007 1,320,000 120,000 5 _| Information Technology 29/03/2020 | 225,000 | 15,000 nay ||] [Business Planning and sheiantk neeear eae NR Development 7 |Legal 30/05/2007 | 876,000 | 24,000 us | Customer Relations Management | 16/02/2020 ] 57 509 | 157,000 N/A 9 Sales & Sales Administration 02/01/2013 1,020,000 N/A N/A rope 4DAMAC Corporate Governance Report 2020 4. External Auditor: A. An overview of the Company's External Auditor: BDO Chartered Accountants and Advisors is the Company's external auditor. BDO Chartered Accountants and Advisors is a well-known institution in the services of auditing, taxes, and consultancy across the globe. B. Statement of fees and costs for the audit or services provided by the external auditor, according to the following schedule: Name of the audit office and BDO Chartered ocean) and Advisors | Name of partner auditor Mohamed Afzal Koya Ali No. of years spent as an external auditors of the : Company Total Auditing fees for 2020 550,000/- | Fees and cost of the other special services other than NA ~ | auditing of the financial statement of 2020 Details and nature of the other provided services N/A Statement of other services performed by external Nil | auditors other than the Company auditors during 2020 ig the reservations that the Company auditor included in the interim and annual financial statements for 2020: The Company auditor had no reservations about the interim and annual financial statements for 2020. 5. Audit, Compliance, and Risk Committee: ‘A. The Audit, Compliance and Risk Committee Chairman's acknowledgment: Mr. Yahya Nooruddin, Chairman of Audit, Compliance, and Risk Committee, acknowledges his responsibility for the committee system in the Company, review of its work mechanism and ensuring its effectiveness. Page LSDAMAC Corporate Governance Report 2020 B. Names of the Audit, Compliance, and Risk Committee members and clarifying their competences and tasks assigned to them: The Audit, Compliance and Risk Committee (“ACR Committee”) is comprised of the following Board Members: S.N. Name Role Capacity Mr. Yahya Nooruddin Chairman Non-executive/Independent Director __| Mr. Faroog Arjomand Member | Non-executive/independent Director Mr. Ali Malalla Binjab Member | Non-executive/Independent Director * Mr. Nabil A-Yousuf resigned from the membership of the Board of Directors and ACR Committee on 16/11/2020, and Mr. Ali Malalla Binjab was appointed as a member of the Board of Directors and member of the ACR Committee instead of Mr. Nabil Al-Yousuf. The main duties of the ACR Committee include (but are not limited to) the following, in respect of which the Committee shall: a) Develop and apply the policy for appointment of the external auditors and report back to the Board to set forth the issues in respect to which action shall be adopted together with recommendations on necessary to-be-adopted steps; b) Follow up and oversee the independence and objectivity of the external auditor and hold discussions with the external auditors on the nature, scope and efficiency of auditing pursuant to approved audit standards; ©) Oversee the integrity of and review the Company's financial statements and annual, semiannual and quarterly reports in the course of its operations during the year and shall, in particular, focus on: 1 Any changes in accounting policies and practices; Highlighting matters that are subject to the management's judgment; Material amendments emerging out of auditing; Assumption of the Company's going concern; Adherence to the accounting criteria set by the Authority; and Adherence to listing and disclosure rules, as well as other financial reporting and legal requirements; 4) Coordinate with the Board, the executive management and the financial manager or the manager assuming the same duties in the Company, in order to fulfill its duties. The Committee shall hold a meeting with the Company's external auditor at least once per annum; €) Consider any outstanding unconventional issues that are or have to be reflected in these reports and accounts and shall pay necessary attention to any issues raised by the financial ousun rage 16WAMAC Corporate Governance Report 2020 manager of the Company, the manager assuming the same duties, the Compliance Officer, the Risk Officer or the external Auditor; f) Review the Company's financial control, internal control and risk management systems; 8) Lay down the scope of and review the findings and suggestions of the Compliance Officer and suggest appropriate corrective measures to the management of the Company; h) Lay down the scope of and review the findings and suggestions of the Risk Officer and suggest appropriate corrective measures to the management of the Company; ’) Discuss the overall internal control system with management and make sure that it fulfills its duty to develop an effective internal control system; j) To consider findings of main investigations into internal control issues to be assigned thereto by the Board or at the initiative of the Committee upon the approval of the Board; ) Ensure coordination between internal and external auditors, ensure availability of necessary resources for internal audit body, and review and control the efficiency of this body; 1) Review the Company's financial and accounting policies and procedures; m) Review the mission and action plan of the external auditor and any material inquiries raised by the auditor to the management in respect of accounting records, financial accounts or control systems, respond thereto and approve the same; n) Make sure that the Board responds on a timely basis to inquiries and material issues raised in the external auditor's mission; ©) Develop rules that enable the employees of the Company to secretly report any potential violations in financial reports, internal control or other issues and adequate steps to conduct independent and fair investigations into these violations; P) Oversee the scope of the Company's compliance with its code of conduct and conflict of interest by the Board members and management of the Company; q) Ensure application of rules of operation in connection with their duties and powers assigned thereto by the Board 1) Submit a report to the Board on the issues set in this clause; and s) Consider any other issues as the Board may determine. The ACR Committee convened four (4) times during 2020, of which the minutes of the meeting were recorded and approved. The Chairman of the ACR Committee periodically presents his reports on the outcome of the ACR Committee at the subsequent Board meeting held after each ACR Committee meeting and provides recommendations on periodic financials and other matters. ¢. Number of meetings held by the Audit Committee during 2020 and their dates: fae Wetgt Wet? Tie Teta Tape opps 21 sap wi vas Rierdadrerey | ATRTTEN | pacediamady | _AnmeerenctyDAMAC Corporate Governance Report 2020 Mr Farooq a ‘ended T Attended ‘Attended ‘Atjomand | ab abvouset is ‘Attended L ‘attended ‘Attended 6- Nomination and Remuneration Committee (“N&R Committee”): A. The Nomination and Remuneration Committee Chairman's acknowledgment: Mr. Faroog Arjomand, Nomination and Remuneration Committee Chairman, acknowledges his responsibility for the committee system in the Company, his review of its work mechanism and ensuring its effectiveness. B. Names of the members of nomination and remuneration committee, their competencies and tasks assigned to them: The Board of Directors has constituted the Nomination & Remuneration Committee in compliance with the Corporate Governance Manual. The N&R Committee is comprised of the following Board Members: S.N. Name Role Capacity Mr. Faroog Arjomand | Chairman | Non-executive/independent Director . | Mr. Ali Malalla Binjab Member Non-executive/Independent Director 3.__ | Mr. Yahya Nooruddin Member | Non-executive/independent Director * Mr. Nabil A-Yousuf resigned from the membership of the Board of Directors and N&R Committee on 16/11/2020, and Mr. Ali Malalla Binjab was appointed as a member of the Board of Directors and member of the N&R Committee instead of Mr. Nabil Al-Yousuf. The main duties of the N&R Committee include (but are not limited to) the following: 1. Verification of ongoing independence of Independent Board Members. 2. Formulation and annual review of the policy on granting remunerations, benefits, incentives and salaries to Board members and employees of the Company and the committee shall verify that remunerations and benefits granted to the senior executive management of the Company are reasonable and in line with the Company's performance. 3. Determination of the Company's needs for qualified staff at the level of the senior executive management and employees and the basis of their selection. 4. Formulation, supervision of application and annual review of the Company's human resources and training policy. a TN rageDAMAC Corporate Governance Report 2020 5. Organisation and follow-up of procedures of nomination to the membership of the Board in line with applicable laws and regulations as well as this Resolution. 6. A policy for nomination for the Board membership shail be developed with the objective to observe diversity of genders in the Board formation and encouraging the nomination of women to the Board of the Company. 7. Arrange for periodic reviews of its own performance and, at least annually, review its constitution and terms of reference to ensure it is operating at maximum effectiveness and recommend any changes it considers necessary to the Board for approval. €. Statement of number of meetings held by the committee during 2020: Name Meating 1 | 3/11/2020 | Mr. Farooq Arjomand ‘Attendes Mr. Yahya Nooruddin ‘Attended remotely (Mr. Nabil Al-Yousuf —__Attended 7- The Supervision and Follow-up Committee of Insiders’ Transactions: ‘A. Acknowledgment by the Chairman of the Supervision and Follow-up Committee of Insiders’ Transactions: Mr. Maher Elbilbeisi acknowledges his responsibility for the follow-up and supervision system on transactions of the insiders in the Company, review of its work mechanism and ensuring its effectiveness. 8. Names of members of the Supervision and Follow-up Committee of insiders’ transactions and clarifying their competences and tasks assigned to them: [s/n | Name I Mr. Maher Elbilbeisi Soliman 1 2 Mr. K 3 Mr. Abdulhamid Seyam . Summary of the Committee’s work report during 2020: The Committee had a meeting on 27/02/2020 to discuss the insider trading policy of the Company. The Committee noted no insider trading in the Company shares.DAMAC Corporate Governance Report 2020 Name [Meetings SY 27/02/2020 Mr. Maher Elbibeisi Attended Me. Karim Soliman Attended (Mr. Abdulhamid Seyarn ‘Attended 8 Any other committee(s) approved by the Board: Other than the above Supervision and Follow-up Committee of Insiders’ Transactions, the Board did not form any additional committee. 9- Internal Control System: ‘A. Acknowledgment by the Board of its responsibility for the Company internal control system, review of its work mechanism and ensuring its effectiveness: The Board of Directors acknowledges that it is responsible for creating and delivering sustainable value to shareholders through the management of the businesses, hence, the Board of Directors has an overall responsibility to ensure that executive management designs and implements an effective Internal Control System which provides assurance of effective and efficient operations, accurate financial reporting and compliance with applicable laws and regulations. The ACR Committee is delegated by the Board of Directors to oversee the internal control systems and update the Board periodically on the resourcing, testing, and effectiveness of internal controls in the Company. The Internal Control Structure System established in the Company is as below: PO. Box: 12288 Dubai UAE, Page 20DAMAC Corporate Governance Report 2020 i Te _ Es i = ee semen ET emetnen | | 4 + 1 The Internal Control System helps the Company achieve its goals by following a regulated methodology aimed at assessing and improving the efficiency of risk management and processes of control and Corporate Governance. B. Name of the Internal Audit Officer, his qualifications and date of appointment: The Board of Directors resolved in 11/11/2020 to appoint Mr. Bhanu Arora as Internal Audit Officer instead of Mr. Santosh Vishwanath, who held the position during the previous period, Mr. Arora is a Certified Public Accountant (CA) - India and Certified Internal Auditor (CIA) - USA. C. Name of Compliance Officer, his qualifications and date of appointment: The Board of Directors resolved in 11/11/2020 to appoint Mr. Bhanu Arora as Compliance Officer instead of Mr. Santosh Vishwanath, who held the position during the previous period. Mr. Arora is a Certified Public Accountant (CA) - India and Certified internal Auditor (CIA) - USA. D. How the Internal Control Department dealt with any major problems at the Company or those that were disclosed in the annual reports and accounts: In case of any major control deficiency in audit findings, the Internal Audit department reports issues to the Audit Compliance and Risk Committee of the Board of Directors. PO. Box 17735 Dubai-UAE Poged 1DAMAC Corporate Governance Report 2020 The Audit Compliance and Risk Committee takes the necessary actions to handle all such cases; the Committee requests the Company's Management provide necessary disclosure and implement the necessary procedures to mitigate any potential risks. E. Number of reports issued by the Internal Control Department to the Company's Board of Directors: The Internal Control Department issued (16) reports to the Company's Board of Directors during 2020. 10- Details regarding violations committed during the financial year, their reasons, how to handle them and avoid their reoccurrence in the future: During the year 2020, the Company did not incur any fines or restrictions by the Securities and Commodities Authority or any legal authority, regarding any issue related to capital market. Furthermore, no matters of non-compliance under the Corporate Governance Guide were observed. 11-Statement of cash and in-kind Contributions provided by the Company during 2020 to develop the local society and preserve the environment: During 2020 there was cash contribution provided by the Company to the following institutions: AED"000 (@ Mohammed Bin Rashed Al Maktoum, 1,000 Humanitarian & Charity Est (i) Mohammed Bin Rashed Al Maktoum Global 500 Initiatives. (ii) Others. 40 12-General information: A. Statement of Price of the Company's Shares at the end of each month during the financial year 2020: ‘Company Share I Month End Closing Prices ih Votume| company) orm] Rel 2020 Price Traded Share | General | ction (AED) (shares) (AED) Index Index January | 0.76 | 0.65 | 94,060,374 0.70 2,790.42 | 3,622.50WAMAC Corporate Governance Report 2020 February | 0.71 | 0.60 | 54,540,340 0.66 2,590.00 3,199.99 | March | 0.64 | 0.36 | 119,224,312 | 0.48 4,771.31 2,095.85 April | 0.67 | 046 | 83,796,491 0.62 2,026.61 2,583.68 May 0.66 | 055 | 83,797,687 0.63 1,945.09, 2,405.26 | June 0.72 | 062 | 47,513,664 0.69 2,065.28 2,589.42 uly 098 | 071 | 197750994 | 0.90 2,050.77 2,598.92 August | 0.92 | 0.81 | 49,959,418 0.88 2,245.29 2,769.86 September | 0.98 | 0.84 | 112,133,230 | 092 | 2,273.48 2,758.31 October | 1.21 | 0.88 | 103,718,910 | 1.09 2,187.86 2,718.41 November | 120 | 101 | 112,671,519 | 1.18, 2,419.60, 3,168.00 December | 1.75 | 1.17 | 254,620,735 1.30 2,491.97 3,397.39 Source: Bloomberg, Dubai Financial Market * Close price for the prices according to the close price for each last day of trading of the related month Estate and Construction Index during 2020 —DAMAG Share Price. ——DFM Generalindex 225 Indexed to 100 based on 31 Dec 2019 closing price 200 175 150 125 100 5 50 6 o Chart of the comparative performance of the Company share with General Index and Real ——DFMReal Estate & Construction Index Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul20 Aug-20 Sep-20 Oct20 Nov-20 Dec-20 31 Dec 2019 31 Dec 2020 Percentage of Change % Company share price 074 1.30 75.0% | DFM General index 2,764.86 2,491.97 9.9% DFM Real Estate & 3,699.12 7. 8. Construction Index 3,397.39 oz * Source: BloombergDAMAC Corporate Governance Report 2020 C. Statement of the shareholders allocation as on 31/12/2020: Shareolde?s : Sharaoler Streoting feeectine | wowouns | comoranons | covernmens | —Toutstres | percenage UAE 158,719,564 3,439,911,087 0 J 3,598,630,651 59.5% eee 36,742,450 | 359,615,917 0 [396,358,367 6.6% FOREIGN 45,918,846 2,229,092,136, oO 2,055,010,982 34.0% Total 241,380,860 5,808,619,140 oO 6,050,000,000 | 100.0% Percentage | 399% 3601% | 0 10.00% _ D. Statement of the shareholders holding 5% or more of corporate capital as on 31 December 2020: S.N. Shareholder Nationality | Number of Percentage Shares % 1._| Data Mark Investments Company Llc | UAE 559,625,000 9.25% 2. | Business Pioneers Investment Co LLC UAE | 559,625,000 9.25% E. Distribution of the Shareholding as on 31 December 2020: ] Number of | Number of | %of owned SN. Share(s) Ownership Owned shares of Shareholders 5 Shares capital 1,_| Less than 50,000 780 11,894,154 0.20% 2._| From 50,000 to less than 500,000 500 74,278,562 1.23% 3.__| From 500,000 to less than 5,000,000 | 96 132,433,306 2.19% 4._| More than 5,000,000 34 5,831,393,978 | 96.39% Total TA10 6,050,000,000 | 100.00% F. Investor Relations: The Company's in-house investor Relations team is responsible for handling all interactions and Correspondence with shareholders, analysts, investors and potential investors, as well as other capital market community members. This includes analyst and investor roadshows, attending investor conferences across the globe, along with financial public relations. page24WAMAC Corporate Governance Report 2020 During 2020, Mr. Amer Abu Shaaban contacted the investors in his capacity as a Head of Investor Relation in the Company. All data related to disclosure, dividends, financial reports, corporate governance, the annual financial report and other information related to the shares are available on https://www.damacproperties.com/en/investor-relations. For suggestions and complaints investors may contact the investor relations team on: Phone: +971 4373 1000, Fax : 971 4373 2335, Email: investor.relations@damacgroup.com . G. Statement of the special decisions presented in the General Assembly held during 2020 and the procedures taken in their regard: During 2020, the General Assembly issued a special resolution in the meeting held on 14/5/2020 to amend the article (19-A) of the Article of Association of the company concerning the numbers of the Board Directors, so that after the amendment it becomes as follows: “The Company is managed by a Board of Directors consisting of five (5) members, who are elected by the shareholders General Assembly by secret cumulative vote” H. Secretary of the Board of Directors: On 11/11/2020, the Board resolved to appoint Mr. Ahmed Fiala as Board Secretary instead of Mr. Maher Elbilbisi and Mr. Magdy Elhusseiny. Mr. Ahmed Fiala has (20) years of experience in the egal field and he holds a Bachelor's degree in Law from Mansoura University ~ Egypt, and he is a member of the Bar Association in Egypt. |. Detailed statement of major events and important disclosures that the Company encountered during 2020: Qi: * The Company launched A La Carte Villas — the UAE’s first ‘design your own home concept! which enables buyers to personalise multiple aspects of their homes including villa type, layout, landscaping, interiors, and furnishings, among others. * Due to the Covid-19 pandemic, 100% work from home was implemented across all departments at the Company. PageWAMAC Corporate Governance Report 2020 © The Company launched Ziwo — a mobile calling solution which enables the sales team to make calls anytime, anywhere. * The Company unveiled its virtual key handover process, which allows for the handing over of properties purchased by customers without their physical presence through e- signatures, virtual snagging and key release. ‘© The Company completed the structure of Vera Residences in Business Bay, Dubai. * The Company launched DAMAC Central, which consolidates all company approval mechanisms into one app. ‘* The Company launched the Digitisation of Sales process, which enables e-signatures in the unit registration process. aa: The Company awarded Trans Emirates Contracting a contract worth AED 181,000,000 to start main works of ZADA, a 26-storey building located in Business Bay. * The Company announced the completion of the structure of Tower B in its Dubai Canal facing Sheikh Zayed Road AYKON City Project. * DAMAC Hills debuted the UAE's first residential community wave pool, Malibu Bay, bringing the beach right to the doorstep of community residents. ‘* The Company logged 53 million safe man-hours on construction sites J. Percentage of Emiratisation: 2018 2019 2020 ‘| Corporate employees number: 1,287 1224 | 995 Emirati employees number B 2 2B Percentage: 1% 1% 131% K. Statement of innovative projects and initiatives carried out by the Company or being developed during 2020: Due to the unprecedented Covid-19 pandemic in 2020, organisations from various industries across the world accelerated their drive towards digitisation.DAMAC Corporate Governance Report 2020 The Company continued its digital transformation journey with tech driving brand awareness and business growth campaigns, which resulted in new sales at an optimum cost over all other channels. The company also focused on cultivating and enhancing its relationships with its current ‘customer base, The Company also implemented new initiatives such as, digitisation of the sales process including Unit registration processes using e:signature, the Ziwo mobile calling solution which enabled the sales team to make calls anytime, anywhere, and the launch of DAMAC Central which consolidated company approval mechanisms into a single app, Signature of the Board Chairman. Signature of Audit, Compliance, and Risk Committee Chairman € aA oe Date: 067047 2021 Date: 061072021 Signature of Nomination and Remuneration Signature of Internal Audit Officer Committee Geran A Po aye a Date: 06i0a/ 2021 Date: 06/087 2021 “This is an English translation of an Arabic piece approved by SCA, In case of any ambiguity the ‘Arabic language shall prevail. Page27