2007-2008 remuneration policy for the Executive Board

Each year, the Remuneration Committee compares the overall remuneration package of members of the Executive Board of Royal Vopak against the remuneration levels at a number of companies similar to Vopak. The comparison is based on international spread, nature of the business, size and stage of development of the company. The criterion is that the overall package, which consists of the annual salary, short and long-term bonuses and pension, is at least competitive with the remuneration packages at those companies.

Further to the review in 2006, changes were made to in the short and long-term bonus plan which were approved during the Annual General Meeting held on 26 April 2007. The Remuneration Committee was advised in developing the remuneration policy by independent external remuneration advisers.

1. Fixed component - Annual salary
The amount of the fixed gross annual salary has been set so that it represents a proper reward for the efforts and responsibilities of the Vopak Executive Directors. Under the job-evaluation policy used by Vopak, these responsibilities are set out in an independent assessment by Hay Group consultants. It is also important to be able to attract and retain directors who have the right specific experience and competencies to achieve the company’s strategic objectives.

Each year, the Remuneration Committee checks whether the annual salaries of Vopak’s Executive Directors are sufficiently in line with these criteria. The check addresses the following elements: the structure and objectives of the company at that time, the performance of the individual Executive Director, general salary market developments and trends in the salaries of directors of companies similar to Vopak. The Supervisory Board sets the directors’ annual salary for the coming year following a recommendation of the Remuneration Committee.

2. Short-term variable component - annual bonus
For the bonus year 2007, the Executive Directors were able to earn an annual bonus of 40% of the annual salary if they met the targets agreed in advance with the Supervisory Board. The maximum bonus is 62.5% if the pre-agreed maximum level of the targets is achieved.

For 2008, the possible bonus for the Chairman has been changed to 50% for on target performance and 70% of the annual salary for maximum performance. The possible bonus percentages for the other members of the Executive Board are unchanged.

The performance criteria for the annual bonuses in 2007 and 2008 are broken down equally between financial targets and personal targets. The Supervisory Board sets financial targets each year for growth in earnings per share (EPS) and Return on Capital Employed (ROCE). The personal targets are set annually after consultation with the individual Executive Directors. These targets relate to personal performance, the performance of the Executive Board as a whole and a number of specific joint and individual targets. These targets are not made public for commercial and competition reasons.

The relationship between performance and remuneration is set annually by the Supervisory Board and defined in a performance-remuneration matrix.

If EPS grows by 8% to 12% or more in the bonus year 2007 compared with the previous year, the annual bonus increases proportionately from 0% to a maximum 20% of the gross fixed salary. In addition, the Executive Directors have to achieve a ROCE of at least 14%, in which case 2.5% of the gross annual salary is paid out. If the ROCE percentage increases, this bonus increases proportionately to a maximum of 22.5% of the gross annual salary if the absolute ROCE is 18% or higher.

The financial target for the EPS performance criterion is being maintained for the bonus year 2008; if EPS grows by 8% to 12% or more compared with the previous year, the annual bonus increases proportionately from 0% to a maximum of 22.5% (chairman) and 20% (other members) of the gross annual salary.

With respect to the ROCE performance criterion, the target for the bonus year 2008 has been increased. Executive Directors have to achieve a ROCE of at least 18%, in which case 2.5% of the gross annual salary will be paid out.

If the ROCE percentage increases, this bonus also increases proportionately, to a maximum of 22.5% (chairman and other members) of the gross annual salary if the absolute ROCE is 20% or more.
 
An Executive Director can earn up to a further 25% (chairman in 2008) and 20% (chairman in 2007 and other members in 2007 and 2008) of the fixed gross salary by achieving personal targets set each year.

3.A Long-term bonus (to 31 December 2007) - Long Term Cash Plan
The long-term bonus plan in the form of the Long-term Cash Plan 2005-2007 allows Executive Directors to earn a cash bonus if EPS grows by at least 25% in a period of three years. If so, an amount equal to 60% of their average fixed salary for the three-year period will be distributed to the members of the Executive Board. This figure can rise to a maximum of 120% of the average fixed salary if the increase in EPS for this period is 35% or more.

3.B Long-term bonus (from 1 January 2008) - Long Term Incentive Plan
The Long-term Incentive Plan (LTIP) approved by the Annual General Meeting in 2007 consists of two plans: the Performance Share Plan and the Share Ownership Plan. The Plan’s aims are:

• to encourage Executive Directors to pursue a policy aimed at the company’s profitable growth;
• to reward the Executive Directors for this policy if it is successful;
• to further promote the links between the Executive Directors and the company.

Performance Shares
Under the new Performance Share Plan (PSP), a block of performance shares (Vopak shares) is granted conditionally to the Executive Directors each year. The grant criteria are:

• the Executive Director’s gross annual salary at the time of the conditional grant;
• the policy-based value as a percentage of gross annual salary: 45% for the chairman and 40% for the other Executive Directors for 2008;
• the average closing market price in the quarter preceding the conditional grant.

Final grant will be after three years and is based on achieving financial targets with the number of shares granted ranging between 0% and 150% of the number of shares granted conditionally at the beginning of the performance period.

The financial performance of the business during those three years is measured by the average ROCE and growth in EBITDA. Based on currently-known variables, the maximum definitive grant at the end of the three-year period (which starts in 2008) would be a total of 20,829 performance shares for the three members of the Executive Board together.

Share Ownership - Matching Shares
Members of the Executive Board are also required to build up and keep a portfolio of Vopak shares in the amount of one year’s gross salary. To this end, from 2007, they can purchase shares which are placed in a portfolio. If the portfolio held in the Executive Director’s name reaches the intended level, the Performance Shares obtained after three years become available to the Executive Director. If the intended level is not reached, the Performance Shares, after the three-year period, are placed in a portfolio and frozen for five years. The shares in the portfolio are released after this five-year period, notwithstanding an Executive Board member’s obligation to maintain the shares in a portfolio at the target level of one year’s gross salary.

As consideration for keeping the shares in a portfolio, the company offers a performance-related number of matching shares after five years. For this, performance is measured by the EPS growth criterion for the five-year period. The number of matching shares can rise to 200% of the number of shares placed in the portfolio in a given year. For 2012, the number of matching shares could range between 0 to a total of 20,380 for the three members of the Executive Board together.

Vopak has repurchased 85,000 shares to cover commitments to the Executive Board and senior management under the LTIP. The purchase programme has been carried out by a credit institution that made its trading decisions on the purchases independently of Vopak and without Vopak influencing the timing of the purchase.

4. Pension component
The Royal Vopak Executive Directors’ Pension Plan is a defined contribution plan under which the Executive Directors receive an amount each year to build up a retirement pension. The pension contribution paid to the Executive Directors is between 20% and 36% of pensionable earnings, depending on their age. In accordance with contractual arrangements, the retirement age for the current Executive Directors is 60 to 62 years.