EEII : Annual Report 2023 (en)

Annual Report 2023

2	Annual Report 2023

Contents

Letter to the Shareholders	03
Portfolio Description	04
Corporate Governance	05
Annual Report	12
Determination of the Net Asset Value	13
IFRS Financial Statements	14
IFRS Statement of Financial Position	14
IFRS Statement of profit or loss	15
IFRS Statement of Comprehensive income / (loss)	15
IFRS Cash Flow Statement	16
IFRS Statement of Changes in Equity	17
Notes to the IFRS Financial Statements	18
Report of the Auditors	33
Statutory Management Report	36
Statutory Financial Statements	37
Statement of Financial Position	37
Statement of profit or loss	38
Cash Flow Statement	39
Notes to the Financial Statements	40
Report of the Statutory Auditor	42
Organization, Related Parties, Management,
Advisor and Address	46

Letter to the Shareholders 3

Dear Shareholders

2023 was a year of consolidation and refocus for EEII AG. Following the sale of the majority stake of the Company by its former anchor shareholder, Gehold SA, to SEBRINA HOLDING SUISSE SA, with the transaction having been completed in 1H 2023, EEII AG has re-defined its investment strategy, with the aim of becoming one of Swit- zerland's and Europe's leading gas stations operator. As specialists for energy infrastructure, we intend to benefit from the changing fundamentals that are increasingly altering the way gas stations will conduct their business in the future: while they will keep gaining importance as local retail shops, their core activity will need to change in order to adapt to the advance of new fuel types and battery powered vehicles. We are convinced that an independent operator of gas stations combining retailing expertise with expertise in non-traditional fuels will not only be very well positioned to benefit from these changes, but will actually be able to actively drive them.

As a consequence of its redefined investment strategy, EEII has sold its only remaining asset in its portfolio, its PJSC Gazprom shares listed on the Moscow Stock Exchange, after the balance sheet date.

The decrease in the Company's NAV is wholly attributable to the on-going operational costs of the Company which were kept to an absolute minimum. To assure the Com- pany's uninterrupted liquidity, the anchor shareholder of EEII AG has arranged for fully subordinated loans granted to the Company and has issued a formal guarantee to the Company for the full coverage of our running costs until the new investment strategy is enacted.

We look forward to embarking on a new and exciting journey with you.

Yours sincerely,

Victor Lorenz Gnehm

Chairman of the Board of Directors

4	Annual Report 2023

Portfolio Description

The Composition of the Portfolio did not change during the course of 2023. The important position of Gazprom shares remained in local custody in Moscow following the forced conversion of the ADR. Due to the sanctions against Russia, EEII not had access to the position and therefore it is not possible to execute any sale of this position. For a prudent valuation of the overall portfolio, we maintain the depreciation of the Gazprom position due to the ongoing sanctions in place.

Gazprom ("GAZP")

Gazprom, Russia's state-controlled energy giant, is grappling with significant financial challenges as its European gas exports have sharply declined following the sanctions imposed. Gazprom's pre-tax earnings hit a record in early 2022 but slumped by 40 % a year later, with predictions of potential net losses in 2025. Europe, diversifying gas sources, reduced Russia's share from over 40 % to 8 %, while the EU aims to eliminate all Russian fossil fuel imports by 2027. Gazprom's attempts to find new buyers in Central Asia and minor boosts to China and Turkey only partially compensate for the lost European market. The ruptured Nord Stream pipelines further hampered Russia's leverage. Despite increased domestic sales, Gazprom faces challenges with regulated prices and stiff competition. Gazprom's oil business, Gazprom Neft, has become vital for revenue, but the company's future remains uncertain, with concerns about potential state subsidies replacing its once lucrative status. The outlook for Gazprom Shares are uncertain even if the sanctions should be lifted.

For events after the balance sheet date, we refer to Note 14

Corporate Governance 5

Corporate Governance

// Group structure and shareholders

// Capital structure

Group structure

EEII AG (the "Company") with its registered office in Zug, Switzerland, is a corporation established on August 29th, 1997 under the laws of Switzerland. The investment objective of the Company is to maximize long-term return to shareholders through investments in strategically selected companies in the energy and infrastructure sectors which are primarily active in emerging markets (see also Note 1 to the IFRS financial statements). As of December 31st, 2023 the only investment of the Company was listed and tabled in Note 5 to the IFRS financial statements. The Company had no employees and no subsidiaries as of December 31st, 2023.

The shares of the Company are listed on the SIX Swiss Exchange. As of December 31st, 2023, the total market capitalization, based on the share price last paid, amounted to CHF 3,97 mln.

Significant shareholders

The following notifications pertaining to the holdings of a significant shareholder have been disclosed:

Since December 22nd, 2022 SEBRINA HOLDING SUISSE SA hold 92.41 % of the capital. The ultimate controlling party of SEBRINA HOLDING SUISSE SA is Mr. Alexandre Uldry, in Gstaad, Switzerland.

Cross-shareholdings

There are no cross-shareholdings.

Capital

As of December 31st, 2023, the Company's share capital consisted of 1,527,510 ordinary bearer shares with a nominal value of CHF 7.10 per share (Security No. 716295/ISIN-Code CHF0007162958). Each share represents one voting right (see also Note 4 to the IFRS financial statements).

Shares and participation certificates

There are no preferential rights or similar rights. Each share carries one vote and has full dividend rights. There are no voting right restrictions and each shareholder can exercise his voting rights at the Company's shareholders meeting. There are no participation certificates.

Profit sharing certificates

There are no profit sharing certificates outstanding.

Limitations on transferability and nominee registrations

There are no limitations on transferability of shares and there is no nominee regulation.

Convertible bonds and warrants / options

There are no convertible bonds or warrants outstanding.

Dividend

In 2023 the Company did not distribute a dividend to its shareholders.

• Independent Proxy

The Independent Proxy ("Unabhängiger Stimmrechts- vertreter") is elected annually by the ordinary General Meeting of shareholders. The tenure ends at the closure of the next ordinary General Meeting. Re-election is permissible.

6	Annual Report 2023

Philipp Andermatt (with substitution powers to Katia Berchier Theiler and Almedin Hrustanovic) from Bright Law AG, Zug, was re-elected by the ordinary General Meeting of Shareholders of the Company on June 13th, 2023, for a term of office of one year, ending as of the termination of the next ordinary General Meeting.

• Board of Directors

Members of the Board of Directors

The Board of Directors is responsible for managing the business of the Company in accordance with the Articles of Association. The Board of Directors may delegate certain functions to a third-party Manager or other par- ties, subject to supervision and direction by the Board of Directors. On December 31st, 2023, the Board of Directors consisted of two members:

Victor Lorenz Gnehm (Swiss)

1965, between 2005 and September 30th, 2016, non- executive Vice Chairman; non-executive Chairman since October 1st, 2016. Victor Gnehm is an attorney and partner of Schnurrenberger Tobler Gnehm & Partner, Alpenstrasse 2 in Zug, Switzerland (www.stgp.ch). He specializes in commercial and financial law. Victor Gnehm began his career as an investment banker and capital markets specialist for emerging markets with Credit Sui- sse / Credit Suisse First Boston. He held various positions with the bank in Switzerland / Zurich, Russia / Moscow and Ukraine / Kyiv where as a member of the local executive board he built up and headed the Structured Finance and Trade Finance unit. In 1998, Victor Gnehm left the bank in order to join the Zurich office of A.T. Kearney as a Director, and in 2002 he returned to the legal profession as a partner of a Swiss law firm. He joined Schnurren- berger Tobler Gnehm & Partner in 2013 as a Partner. Victor Gnehm studied at the Bern University and the Institut Universitaire des Hautes Etudes Internationales (IUHEI), Geneva, and finished his studies with a Master's degree equivalent in law. He is admitted to the bars of

Switzerland and is a registered member of the Zug and Swiss bar associations.

Alexandre Ugo Uldry (Swiss)

1991, since 2011 Alexandre Uldry has been active as a real estate broker in Switzerland. In 2014 he founded the Gold Real Estate SA in Sion and since 2017 he took the position as Owner and Chairman of the TGAU Holding SA, specialized on real estate assets and real estate owning companies. In June 2021 he founded the Swiss Energy Holding SA, a holding company for energy generating and distribution companies. Since August 2021 he took the position of chairman and owner of Jubin Frères a company managing a network of gas filling stations. As of June 13th, 2023 he has been elected member of the board and CEO of EEII at the General Annual Meeting.

Victor Lorenz Gnehm and Alexandre Ugo Uldry were individually elected by the ordinary General Meeting of Shareholders of the Company on June 13th, 2023. All Board members were elected for a one-year period. Victor Lorenz Gnehm was elected as Chairman.

Other activities and vested interests

Members of the Board of Directors are not currently involved in permanent management or consultancy functions for important Swiss and foreign interest groups. They are not in charge of any official function or political post. Victor Gnehm has been serving as Chairman of the Board of Directors at Plenum Investments AG, Zürich since 2010. Plenum is a specialized asset manager for insurance linked securities.

Cross-Involvement

On the Board of the Company, Victor Gnehm has no cross-involvement.

Alexandre Ugo Uldry acts as chairman of SEBRINA HOLDNG SUISSE SA, the majority shareholder of EEII.

Corporate Governance 7

Elections and terms of office

The Articles of Associationprovide that the Board of Directors consists of one or more members elected by the Company's General Meeting of Shareholders. Each member of the Board is elected individually for a period of one year, normally from one ordinary General Meeting of Shareholders to the next ordinary General Meeting of Shareholders and can be re-elected thereafter. The Chairperson and the members of the Remuneration Committee, which shall consist of two or more members of the Board of Directors are elected by the General Meeting.

Internal organization structure

The Organizational Regulationswhich define the working procedures and directives of the Board of Directors can be found on the company's website.

Remuneration Committee

Victor Lorenz Gnehm and Alexandre Ugo Uldry were individually elected by the ordinary General Meeting of Shareholders of the Company on June 13th, 2023 as members of the Remuneration Committee. The members are elected for a one-year period.

The Remuneration Committee drafts and periodically reviews the remuneration policy and principles of the Company and prepares and recommends all decisions of the Board of Directors concerning compensation of the members of the Board of Directors and the Manage- ment. It submits proposals regarding type and amount of compensation to the members of the Board of Directors and the Management and prepares the proposal for the total amounts of fixed remuneration to the General Meeting of the Company. The Remuneration Committee is also responsible for the preparation of the Remuneration Report. The Board has not formed any other committees than the Remuneration Committee.

Definition of areas of responsibility

The primary duties of the Board of Directors of the Company are defined in Art. 716 et seq. of the Swiss Code of Obligations, the Articles of Association (dated April 30th, 2018), the Organizational Regulations (dated October 27th, 2015) and the Investment Regulations(dated November 23rd, 2023).

The Board of Directors assumes the responsibilities as stipulated in Art. 716 et seq. of the Swiss Code of Obliga- tions. Furthermore, the Board of Directors establishes the necessary strategic, organizational, accounting and financing policies and defines the Company's Organizational Rules and Investment Guidelines. The Board of Directors may delegate management functions to one or more members of the Board or to third parties.

In general, the Board of Directors is responsible for defining target industries, target regions and for decisions regarding the selection, changes in, and disposal of investments, while the Advisor is responsible for analysing potential investment targets and making recommendations the Board of Directors. The Advisor is also responsible for monitoring the investments on an on-going basis. For further responsibilities of the Advisor please see the section description for Advisory contracts below. The Management is responsible for public and investor relations as well as general management and the day-to-day activities of the Company.

Information and control instruments vis-à-vis the management

In order to control and review the Company's performance, the Board of Directors is provided with ad-hoc information for major business activities. The Management reports at the meetings of the Board of Directors. The Board of Directors assesses the risks and the fair value of the investments of the Company at least on a quarterly basis.

8	Annual Report 2023

The Management monitors the Company's risk exposure on a weekly basis. Market price, interest rate, credit, liquidity, currency and concentration risks are central to the analysis. Note 6 of the IFRS financial statements summarizes the exposure of the Company at year-end.

• Management

Members of the management

Employment or mandate agreements between the Company and members of the Board of Directors or the Management may be concluded for a fixed term of one year maximum. Agreements that are unlimited in time must contain a notice period of 12 months maximum. Starting January 1st, 2017 Marcus H. Bühler acted as CEO of the Company until the end of June 2023. Marcus H. Bühler also serves as Chairman of the Board of Weissenstein & Partner AG, Zürich. Weissenstein & Partner also acts as EEII's Advisor starting January 1st, 2017.

Alexandre Ugo Uldry (Swiss)

Alexandre U. Uldry has been appointed CEO as of July 1st, 2023. Until June 30th, 2023 Marcus H. Bühler has been employed as CEO on a part-time basis since January 1st, 2017. During the reporting period, the Company had no other employees. Management was also responsible for all other management functions, which are not specifically reserved to the Board of Directors or the Advisor.

Other activities and vested interests

Not applicable.

Advisory contracts / Mandate agreements

Since January 1st, 2017, Weissenstein & Partner AG (Weis- senstein) has been acting as EEII's Advisor. Weissenstein provides management support and financial advisory services to EEII on the basis of a Mandate Agreement. Pursuant to a Mandate Agreement dated December 6th, 2016, (the "Mandate Agreement"), and subject to its

supervision and approval, the Board of Directors has conferred on Weissenstein & Partner, Bleicherweg 45, CH-8002 Zürich (the "Advisor"), responsibility in particular for the following tasks:

• Financial advisory;
• Investment advisory;
• Public and investor relations;
• Monitoring and reporting;
• Regulatory / compliance.

Weissenstein is a privately held family office and asset management firm. Marcus H. Bühler (CEO of EEII until June 30th 2023) acts as Chairman of the company. Weis- senstein is compensated via an annual fixed fee under the terms of the Mandate Agreement with no variable components (Details Remuneration Report 2023).

The Advisor's management team consists of Christoph Offenhäuser and Barbara Kuhn. For details of the Advisor's management team please refer to the company directly: [e-mail] [phone]

EEII has signed a new advisory contract with Weissenstein for 2024 on December 22nd, 2023. Weissenstein will concentrate on the regulatory and reporting obligations in relation to the SIX and investors. Weissenstein will not provide representatives for the Board of Directors or management under the new agreement.

Under the Administration Agreement dated March 23rd, 2009 ("the Administration Agreement"), MSZ Group AG, Zug ("the Administrator"), provides full accounting and administration services for the Company, in particular for the following tasks:

• Administration and accounting services;
• Support of the Advisor with the quarterly, semi- annual and annual reporting including the weekly NAV-publication;
• Monitoring of tax, compliance and regulatory issues.

Corporate Governance 9

During the reporting period, the Administrator received payments totalling CHF 34,042 (2022: CHF 28,602). Either party may terminate the Administration Agreement at the end of a calendar quarter, by giving prior notice of not less than 6 months.

• Compensation, shareholdings and loans

Content and method of determining the compensation and the share-ownership programs

Since the beginning of the year 2015 the General Meeting approves annually and severally for each of the Board of Directors and the Management a total amount as fixed remuneration for the current business year. The Remuneration Committee drafts and periodically reviews the remuneration policy and principles of the Company. It submits proposals regarding type and amount of compensation to the members of the Board of Directors and the Management and prepares the proposal for the total amounts of fixed remuneration to the General Meeting of the Company. The compensation of the Board Members has been determined to appropriately reflect the size of the Company and the responsibility of the Board Members. The General Meeting approves annually and severally for the Board of Directors and the Management a total amount as fixed remuneration for the current business year. The compensation is fixed on an annual basis with no variable components. There were no additional option or share programs.

For more details regarding the compensation policies see Note 12 to the IFRS financial statements and the separate Remuneration Report of the Company as published on the Company's website.

Compensation for the Board of Directors

The compensation for the Board of Directors was fixed at CHF 30,000 p. a. (including out-of-pocket expenses). The compensation of all Board Members was grossed up to reflect social charges and amounted in total to­ CHF 33,538 (2022: CHF 34,717).

Christoph Offenhäuser did not receive a separate compensation as a member of the Board of Directors until June 13th, 2023. His compensation forms part of the management fee paid from the Company to Weissenstein & Partner who paid him directly.

Alexandre U. Uldry, member of the board and CER since June 13th, 2023 did not receive any compensation.

Compensation for the Management

For the business year 2023 the Company compensated the Management with a fixed amount of CHF 8,000 (2022: CHF 12,000) [excluding employer's contributions to social charges (Swiss social security programs providing retirement, disability and unemployment benefits AHV / IV / ALV of totally CHF 2,183 (2022: CHF 2,720)] and any other taxes).

Loans and credits granted by the Company to members of the Board of Directors or the Management and / or guarantees or other sureties by the Company for obligations of a member of the Board of Directors or the Management may not exceed CHF 50,000 per member. In 2023, there were no such loans granted or outstanding.

Victor Lorenz Gnehm, Schnurrenberger Tobler Gnehm & Partner, Alpenstrasse 2 in CH-6300 Zug, Switzerland (www.stgp.ch), provided general legal counsel to the Company for which he received CHF 70,835 (incl. VAT).

Contributions to pension funds on behalf of members of the Board of Directors or the Management are only made in the framework of Swiss or foreign pension plans or comparable plans of the Company. The Company had no pension scheme in place neither in 2023 nor in 2022.

For more details regarding transactions with related parties see Note 9 to the IFRS financial statements.

10	Annual Report 2023

• Shareholders' participation

Voting-rights and representation restrictions

There are no limitations of shareholders' voting rights. Each share entitles the holder to participate equally in the profits and assets of the Company and to attend and vote at the General Meeting of Shareholders of the Company. Each shareholder may ask the independent shareholder representative by written proxy to represent his voting rights at the General Meeting of Shareholders. Each share carries one vote in the Company's General Meeting of Shareholders.

Statutory quorums

The statutory quorums with regard to the General Meeting­ of Shareholders correspond with the legal regulations as stipulated in the Swiss Code of Obligations. In general, a shareholders' resolution requires an absolute majority of the votes represented at the meeting unless a two-third majority is required by the Swiss Code of Obligations for specific resolutions.

Convocation of the General Meeting of Shareholders

Notice of a General Meeting of Shareholders must be given by the Board of Directors no later than twenty days prior to the meeting date through publication in the Swiss Commercial Gazette ("SHAB") or through a written communication to all shareholders.

Agenda

The meeting notice states the items on the agenda as well as the proposals of the Board and of shareholders who have demanded that an item be included in the agenda. The Board provides an adequate explanation on each agenda item. One or more shareholders who represent at least 5 % of the share capital may also ask the Board of Directors to convene a General Meeting of Shareholders.

Inscriptions into the share register

The company maintains share registers as required by law.

• Changes of control and defence measure

No duty to make an offer on change of control ("Opting Out")

Art. 135 and Art. 163, resp., of the Federal Act on Financial Market Infrastructures and Market Conduct in Securities and Derivatives Trading (Financial Market Infrastructure Act) provide for the obligation to make a public takeover offer in respect of all listed shares in a company listed on the SIX Swiss Exchange in case of a shareholder directly, indirectly or acting in concert with third parties, acquiring shares which (added to equity already owned) exceed the threshold of 33.3 % of the Company's voting rights.

At the ordinary General Meeting of April 30th, 2018, the shareholders of the Company validly adopted a so-called "Opting Out" Clause in the Company's Articles of Association (Clause 7a) which eliminates the duty to make a public takeover offer. The text of the clause runs as follows: "The purchaser of shares of the Company shall not be obliged to make a public offer to acquire all listed shares of the Company pursuant to Art. 135 and 163 of the Federal Act on Financial Market Infrastructures and Market Conduct in Securities and Derivatives Trading (Financial Market Infrastructure Act)."

Black out periods

There are no defined blackout periods. Directors and management maintain and respect confidentiality of price sensitive information.