LEM : AGM Invitation 2023

Invitation

Annual General Meeting of Shareholders

of LEM HOLDING SA

Thursday, 29 June 2023, at 15:30 (CEST)

HP/Hive Innovation Lab, Meyrin,

Switzerland

2023

Invitation to the Annual

General Meeting of

Shareholders 2023 of

LEM HOLDING SA

LEM's Board of Directors is pleased to invite you to the Annual General Meeting of Shareholders 2023.

Date and time

Thursday, 29 June 2023 at 15:30 (CEST)

doors open at 15:00 (CEST)

Place

HP/Hive Innovation Lab

Route du Nant-d'Avril 150, 1217 Meyrin, Switzerland

Public transportation

From Geneva, Cornavin: Take the train #L5 (direction La Plaine) and stop at Zimeysa. Then, take the bus #57 (direction Geneva-Airport) and exit at the bus stop Satigny, Nant-d'Avril. Walk about 1 minute, the HP/Hive Innovation Lab is across the street.

If taking a taxi from Geneva, Cornavin, please allow for about 20 minutes journey time.

From Geneva Airport: Take the bus #56 (direction Meyrin, Hôpital de La Tour) or bus #57 (direction Zimeysa, gare) and exit at the bus stop Satigny, Nant-d'Avril. Walk about 1 minute, the HP/Hive Innovation Lab is across the street.

If taking a taxi from Geneva Airport, please allow for about 10 minutes journey time.

Car parking

Car parking is available at the HP/Hive Innovation Lab,

Route du Nant-d'Avril 150, 1217 Meyrin.

LEM Invitation to the Annual General Meeting of Shareholders 2023

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life energy motion

Our new headquarters in Meyrin, Geneva, and our celebrations of LEM's 50th year as a company there in November 2022 were full of positive energy and inspiration for the future. LEM stakeholders - talents, investors, customers, partners, and shareholders - can see and

feel transformation underway. We are proud to report record performance again this year.

Behind the numbers, the new premises, and stellar events are LEM people. Skilled individuals with

a strong sense of resolve keep our company improving and growing. Although at times over the past year, the pandemic and component constraints depleted our energy and disrupted our plans, LEM people persevered by remaining strong, caring, and positive.

The electronic sensor industry is changing fast, being shaped by continuous technological breakthroughs. The rapid rise in the electrification of the world is driving change faster than ever before. We are focused and moving fast to capture growth opportunities in all of our markets, pursuing our purpose: to help our customers and society accelerate the transition to a sustainable future.

Agenda and proposals

1 Reporting for the financial year 2022/23

• Management report
• Consolidated financial statements of the LEM Group
• Annual financial statements of LEM HOLDING SA
• Compensation report
• Auditors' reports

1.1 Approval of the management report, the consolidated financial statements of the LEM Group, and the annual financial statements

of LEM HOLDING SA as of 31 March 2023

Proposal: The Board of Directors proposes that the management report, the consolidated financial statements of the LEM Group and the annual financial statements of LEM HOLDING SA be approved.

Explanation: Pursuant to Article 698 para. 2 nr. 3 and 4 of the Swiss Code of Obligations (CO) and our Articles of Incorporation, the Annual General Meeting is responsible for approving the management report, the consolidated financial statements and the annual financial state- ments.

1.2 Consultative vote on the compensation report 2022/23 Proposal: The Board of Directors recommends that the compensa- tion report 2022/23 as included in the Financial Report be accepted (non-binding consultative vote).

Explanation: Pursuant to Article 735 para. 3 nr. 4 CO, the Board of Directors submits the compensation report 2022/23 to a consultative vote of the shareholders. The compensation report contains the principles governing the compensation paid to the Board of Directors and the Executive Management and reports on the amounts paid to the members of both corporate bodies for the financial year 2022/23.

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2 Appropriation of available earnings and distribution

Proposal: The Board of Directors proposes that the total available earnings for the financial year 2022/23 of LEM HOLDING SA be allocated as follows:

in CHF thousands
Balance brought forward from the previous financial year		338'436
Variation of treasury shares	(91)
Net profit of the financial year		33'948
Total available earnings		372'293
Proposal of the Board of Directors
Ordinary dividend 1		(59'280)
Balance to be carried forward		313'013

Explanation: Pursuant to Article 698 para. 2 nr. 4 CO and our Articles of Incorporation, the Annual General Meeting is responsible for approving the appropriation of retained earnings. The Board of Directors proposes the distribution of an ordinary dividend of CHF 52 per share. Net of the Swiss withholding tax of 35%, this is an ordinary net cash dividend of CHF 33.8 per share. The shares will be traded ex-dividend as of

4 July 2023. The net dividend is expected to be paid on 6 July 2023.

3 Discharge of the Board of Directors and of the Executive Management

Proposal: The Board of Directors proposes that the members of

the Board of Directors and of the Executive Management be granted discharge for the financial year 2022/23.

Explanation: Pursuant to Article 698 para. 2 nr. 7 CO and our Articles

of Incorporation, the Annual General Meeting is responsible for granting the discharge.

1 Dividend-bearing shares are all shares issued except for treasury shares held by LEM HOLDING SA

and its subsidiaries as of the record date. The amount of CHF 59.28 million is calculated on the total number of shares issued as of 31 March 2023. If the total amount of the ordinary dividend is higher or lower,

the difference will be balanced through the appropriation of the available earnings reserve.

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4 Approval of the compensation of the Board of Directors

Proposal: The Board of Directors proposes that a maximum aggregate amount of compensation of the members of the Board of Directors for the term of office from the Annual General Meeting 2023 until the Annual General Meeting 2024 of CHF 1'400'000 be approved.

Explanation: Pursuant to Article 698 para. 3 nr. 4 CO and our Articles of Incorporation, the Annual General Meeting votes on the compensation of the Board of Directors. Each year, the Board of Directors submits to the Annual General Meeting for approval the aggregate maximum amount

of compensation for the Board of Directors for the term of office until the next Annual General Meeting.

The proposed maximum aggregate amount of CHF 1'400'000 is composed of the following (non-binding) components:

• Fixed compensation of CHF 1'020'000 based on the gross Board of Directors membership fees (CHF 280'000 for the Chairman and CHF 100'000 for each member) and the gross Committee membership fees (CHF 40'000 for the Committee's chairman and CHF 20'000 for each member) for the six members of the Board of Directors proposed for re-election under agenda item
  6 below. For further details on the compensation system of the Board of Directors, please refer to the compensation report 2022/23 in the Financial Report; plus
• Related employer contributions to social security; plus
• Reserve amount, which allows for flexibility in the event of extraordinary events such as significant additional workload of all or certain members of the Board of Directors that requires additional compensation, including membership in ad hoc committees, or an increase in mandatory social security contri- butions due to a change of applicable contribution rates.

Members of the Board of Directors do not receive any variable compen- sation. The actual payout to the members of the Board of Directors

for the term of office from the Annual General Meeting 2023 until the Annual General Meeting 2024 will be disclosed in the compensation report 2023/24.

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5 Approval of the compensation of the Executive Management

Explanation: Pursuant to Article 698 para. 3 nr. 4 CO and our Articles of Incorporation, the Annual General Meeting votes on the compensation of the Executive Management. Each year, the Board of Directors submits to the Annual General Meeting for approval the compensation of the members of the Executive Management in three separate votes:

1. The first approval relates to the gross short-term variable compensation to be paid to the members of the Executive Management under the Leadership for Results (L4R) plan - short-term incentive for the financial year 2022/23 (retrospec- tive approval).
2. The second approval relates to the maximum gross long-term variable compensation to be granted to the members of the Executive Management under the Leadership for Results (L4R) plan - long-term incentive for the financial year 2023/24 (prospective approval) to be paid out in July 2026.
3. The third approval relates to the maximum fixed compensation of the members of the Executive Management for the period from 1 October 2023 to 30 September 2024 (prospective approval).

5.1 Vote on the aggregate amount of short-term variable compensa-

tion of the Executive Management for the financial year 2022/23 Proposal: The Board of Directors proposes that an aggregate amount of short-term variable compensation of the members of the Executive Management for the preceding completed financial year 2022/23 of CHF 1'175'255 be approved.

Explanation: The proposed amount of CHF 1'175'255 is composed of the following components:

• Gross short-term variable compensation of the members of the Executive Management for the financial year 2022/23 of CHF 1'068'414; plus
• Related employer contributions to social security of CHF 106'841.

For further details, please refer to the compensation report 2022/23 in the Financial Report.

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