Singulus Technologies : Compensation Report 2023

INDEPENDENT AUDITOR'S REPORT ON THE AUDIT OF THE REMUNERATION RE-PORT IN ACCORDANCE WITH SECTION 162 (3) AKTG

To Singulus Technologies AG, Kahl am Main

Audit opinion

We have formally audited the remuneration report of Singulus Technologies AG for the financial year from January 1 to December 31, 2023 to determine whether the disclosures pursuant to Section 162 (1) and (2) AktG have been made in the remuneration report. In accordance with § 162 Abs. 3 AktG, we have not audited the content of the remuneration report.

In our opinion, the accompanying remuneration report includes, in all material respects, the disclosures required by section 162 (1) and (2) AktG. Our audit opinion does not cover the content of the remuneration report.

Basis for the audit opinion

We conducted our audit of the remuneration report in accordance with § 162 Abs. 3 AktG and IDW Auditing Standard: The Audit of the Remuneration Report in Accordance with Section 162 (3) AktG (IDW PS 870 (08.2021)). Our responsibilities under this requirement and this standard are further described in the "Auditor's Responsibilities" section of our report. As an auditing practice, we have fulfilled the requirements of the IDW Quality Management Standard: Requirements for Quality Management in the Auditing Practice (IDW QMS 1). We have complied with the professional requirements of the German Public Auditors' Code and the Professional Code for Public Auditors / Certified Public Ac- countants, including the independence requirements.

Responsibility of the Management Board and the Supervisory Board

The Management Board and the Supervisory Board are responsible for the preparation of the remuneration report , including the related disclosures, in accordance with the requirements of Section 162 AktG. In addition, they are responsible for such internal control as they have determined necessary to enable the preparation of a remuneration report that is free from material misstatement, whether due to fraud or error.

Responsibility of the auditor

Our objective is to obtain reasonable assurance about whether the remuneration report includes, in all material respects, the disclosures required by section 162 (1) and (2) AktG and to issue an auditor's report thereon.

We planned and performed our audit such that we can determine the formal completeness of the remuneration report by comparing the disclosures made in the remuneration report with the disclosures required by section 162 (1) and (2) AktG. In accordance with

• 162 Abs. 3 AktG, we have not audited the content of the disclosures, the completeness of the individual disclosures or the fair presentation of the remuneration report.

Limitation of liability

For the performance of the engagement and our responsibility and liability, including in relation to third parties, the "General Engagement Terms for Wirtschaftsprüfer and Wirtschaftsprüfungsgesellschaften" in the version dated January 1, 2017 issued by the Institut der Wirtschaftsprüfer apply.

Düsseldorf, March 30, 2024

Baker Tilly GmbH & Co KG Auditing company (Düsseldorf)

Thomas Gloth	Jonas Hagen
Auditor	Auditor

Attachments

Appendix 1 Remuneration report for the 2023 financial year

Singulus Technologies Aktiengesellschaft, Kahl am Main

Remuneration report for the financial year from January 1 to December 31, 2023

Compensation Report 2023

The Executive and Supervisory Boards of the SINGULUS TECHNOLOGIES AG (the Company) have drawn up this compensation report pursuant to the requirements of Art. 162 German Stock Corporation Act ("AktG").

The report explains the main features of the compensation system for the Executive Board and Supervisory Board and provides individualized information on the compensation granted and owed to current and former members of the Executive Board and Supervisory Board in the fiscal year 2023.

Due to rounding, it is possible that some numbers in this report do not add up precisely to the totals shown and that percentages presented do not accurately reflect the absolute values to which they relate.

This report has been formally audited by the Company's auditors in accordance with Art. 162 (3) of the German Stock Corporation Act (AktG); the corresponding audit certificate is included in this report.

Review of the past business year 2023

The composition of the Executive Board did not change in the year under review.

A) Compensation of the Executive Board

1. Members of the Executive Board in the business year 2023

Dr.-Ing. Stefan Rinck, CEO

Chief Executive Officer; Executive Board member responsible for Marketing & Sales, Technology, Production, Research & Development as well as Strategy and International Activities.

Dr.-Ing. Stefan Rinck has been appointed to the Executive Board until December 31, 2024.

Dipl.-Oec. Markus Ehret

Executive Board member responsible for Finance, Controlling, Investor Relations, Procurement, Human Resources and ESG (CFO).

Mr. Markus Ehret has been appointed to the Executive Board until December 31, 2028.

1. Description of the compensation structure

1. Overview compensation structure

1.1. Design and goals of compensation structure

The compensation of the individual members of the Executive Board is determined and regularly analyzed by the Supervisory Board. It is the goal to appropriately remunerate the Executive Board members according to their functions and responsibilities and to consider the individual performance as well as the economic situation, the success and the future prospects of the company.

The compensation structure for the Executive Board of the Company is determined in accordance with the provisions of the Stock Corporation Act taking into account the recommendations of the German Corporate Governance Code and is geared towards a sustainable and long-term corporate development. The total compensation of the members of the Executive Board is comprised of a fixed and a variable component, divided into short-term and long-term components as well as benefits in kind. It is in line with the Board's tasks and performance as well as with the size and situation of the Company. The compensation system ensures that both positive and negative developments are appropriately reflected in compensation (Pay for Performance). It takes into account both the performance of the Executive Board as a whole and the achievement of individual targets, thus remunerating the work performed by Executive Board members in a results-oriented and competitive manner and creating incentives for Executive Board members to increase the value of the Company. The compensation system is clearly structured and also easily comprehensible and transparent to shareholders.

To plan, manage and control its targets, the Company relies on the key performance indicators order intake, order backlog, sales, EBIT and liquidity. The financing of the operating activities is implemented via the capital market as well as loans from banks and investors.

Executive Board compensation is linked to these key performance indicators, the achievement of strategic goals and the share price via variable compensation. In this way, the compensation system makes a significant contribution to promoting the business strategy and the long-term and sustainable development of the Company. In particular the variable components (annual bonus due to agreed targets and share-based compensation) are aligned with the growth targets for the segments Solar, Semiconductor and Life Science.

The system aims to align the interests of the Executive Board with those of shareholders and other stakeholders. It is geared to providing effective incentives for strengthening the operational success of the Company and sustainably increasing its value. The structure of the long-term, variable component is designed to tie the members of the Executive Board to the Company in the long-term.

The fixed, non-performance-based part is composed of a fixed salary and benefits in kind. It is targeted to amount to 60 % of the target compensation. The high proportion of fixed compensation aims to prevent the Executive Board to enter unreasonably high risks to reach short-term targets.

The performance-related components are split into a variable bonus and a share- based compensation component (phantom stocks). The variable bonus is tied to achieving individual targets, which include financial, operating and strategic goals including sustainability goals. The phantom stock program is intended to create a long-term incentive and commitment effect by issuing virtual shares. After the lapse of a waiting period of two years the phantom stocks can be exercised in tranches of 25 % semi-annually if the share price of the company exceeds a specified minimum percentage level above the exercise price. The incentive effect is achieved through performance targets, vesting periods and staggered exercise. Effects from short-term share price increases, which are market-related and not company-related, are thus largely eliminated. The phantom stocks represent a compensation component with a multi-year assessment basis that links the compensation of the Executive Board members to the performance of the stock, thus creating an alignment of the interests of the Executive Board and the shareholders.

In its entirety the compensation framework takes into account the regulation of the Stock Corporation Act and the Corporate Governance Code.

1.2. Process to determine, implement and review the compensation

Pursuant to Art. 87a AktG, the Supervisory Board of the Company is responsible for the structure of the system as such, the determination as well as the regular review of the Executive Board compensation system and the total compensation of the individual Executive Board members. In order to assess whether the compensation of the individual members of the Executive Board is in line with market practices, the Supervisory Board bases its determination of the amount of the target compensation on the situation of the Company, the compensation paid by comparable companies to the members of their management (horizontal comparison) as well as the salary level of the first and second management levels within the Company (vertical comparison). The Supervisory Board also ensures that compensation remains competitive so that Executive Board members can be retained and new ones recruited. A balance is achieved through the size of the Executive Board, which currently has the statutory minimum number of members.

The Supervisory Board regularly reviews the structure and appropriateness of the compensation in the course of its first Supervisory Board meeting of the year. In the review the Board takes into consideration the individual performance and the extent of the responsibilities assumed compared with the other members of the Executive Board as well as the economic situation of the company.

In case of material changes in the compensation system, however at least every four years, the compensation system is presented in the course of the Annual General Meeting for approval. The applicable compensation system for members of the Executive Board was approved by the Annual General Meeting by resolution of June on July 19, 2023. Pursuant to Art. 87a (2) AktG, the Supervisory Board may temporarily deviate from the compensation system if this is necessary in the interests of the long-term welfare of the Company. The Supervisory Board has made use of this reduction option in the past due to the difficult economic situation of the Company. However, a reduction of the compensation was not implemented in the business year 2023, since the commitment of the Executive Board to safeguard the continuation was very high in the period under review.

1.3. Composition of the compensation

The fixed, non-performance-based part is composed of a fixed annual salary and benefits in kind such (including cars and insurance).

The performance-based components are split into a variable bonus and phantom stocks. Furthermore, the contracts of the members of the Executive Board provide the Supervisory Board the possibility to grant one-off special payments for extraordinary performance in addition to the variable compensation components ("One-timeBonus").

The compensation covers the entire activities of the Executive Board members, and accordingly also other Group-internal functions and activities of the respective Executive Board members.

At the request of the Executive Board, the Company takes out a life insurance policy for the Executive Board member concerned as part of a salary conversion scheme.

1.3.1. Fixed salary

The fixed, non-performance based, annual salary of the members of the Executive Board is paid in twelve equal partial payments at the respective end of the months and for the last time for the full month during which the employment contract terminates. It is reviewed annually according to appropriateness and adjusted, if required. An adjustment can also be made by granting one-time bonus payments. There was no adjustment of the fixed salary during the year under review.

1.3.2. Variable bonus (target agreements)

The variable bonus is tied to the achievement of individually agreed targets. These targets are reset annually by the Supervisory Board and individually agreed with the members of the Executive Board following the adoption of the budget for the subsequent year. They are based on the respective strategic objectives for the Company, operating and financial key indicators as well as sustainability goals, which

have been defined by the Supervisory Board in consultation with the Executive Board. Generally, the targets consist of 50 % financial, 30 % operating and 20 % strategic targets. Strategic objectives also include the achievement of sustainability goals (ESG), which are set by the Supervisory Board. The amount of the bonus is subject to the respective percentage achievement of the target. The assessment basis is the amount corresponding to 80 % of the applicable fixed salary. A weighted average is formed from the individual percentages achieved for each individual annual target. This is applied to the assessment basis to determine the amount of the bonus. The variable bonus may not exceed 80 % of the fixed salary. If the annual targets are exceeded by the respective member of the Executive Board, the Supervisory Board may increase the target achievement to up to 120 % on a case by case evaluation at its sole discretion. In case of an assumed 100 % achievement of the annual targets on average the bonus corresponds to 80 % of the fixed salary. If the targets are not achieved or only partially by less than 50 %, the Supervisory Board decides at its sole discretion if and to what extent a bonus will be paid.

1.3.3. Phantom stocks

The phantom stocks program is the second component of variable compensation and is intended to provide a long-term incentive and retention effect by linking compensation to the sustainable performance of the Company. The best indicator of performance is the share price.

The Supervisory Board determines the number of granted phantom stocks at its own discretion. Each individual phantom stock is designed as a virtual option and entitles after the lapse of a waiting period of two years and the achievement of a success target to receive a payment which corresponds to the difference at exercise between the respective exercise price and the reference price for a bearer share of the company with a nominal value of € 1.00 each. The exercise price corresponds to the simple average of the closing prices (or a relevant subsequent closing price) of the shares of the company on the Xetra platform (or a functionally equivalent subsequent system to the Xetra platform) at the Frankfurt Stock Exchange on the five trading days before the issue date. The reference price corresponds to the (non-weighted) simple average of the closing prices (or a relevant subsequent closing price) of the shares of the company on the Xetra platform (or a functionally equivalent subsequent system to the Xetra platform) at the Frankfurt Stock Exchange on the five trading days before the exercise date. The phantom stocks can be exercised for the first time after a vesting period of two years, which starts at the time of issuing the stocks.

After the end of the waiting period, the phantom stocks can be exercised each year within an exercise period. There are two exercise periods, the first begins after publication of the interim report for the first quarter, the second begins after publication of the interim report for the third quarter. During each exercise period only up to 25 % of the granted phantom stocks can be exercised. If an exercise tranche is not exercised during the exercise period, it can be additionally exercised during later

exercise periods. Furthermore, the exercise of the phantom stocks is only possible upon reaching the success target, i.e. if the reference price at the time of the exercise is at least 15 % higher than the exercise price.

During the term of the phantom stock programs, option rights from the phantom stocks can also be exercised prematurely, i.e. also outside the respective exercise period and before the end of the waiting period, as soon as (i) a takeover bid within the meaning of Art. 29 Para. 1 WpÜG has been published for the company's shares or (ii) a person acquires control within the meaning of Section 29 (2) WpÜG. In these cases, all phantom stocks can be exercised, regardless of whether the performance target has been achieved.

The term of the phantom stocks is five years each after the respective issue date. Phantom stocks, which are not exercised by the end of this term, expire without replacement and compensation.

1.4. Maximum compensation

Pursuant to Art. 87a Para. 1 Sent. 3 No. 1 AktG, the Supervisory Board has set the maximum compensation set out below:

The applicable Executive Board service agreements stipulate that the maximum compensation that the respective Executive Board member can receive in the course of a year (fixed and variable compensation including fringe benefits, a possible onetime bonus and pension contributions) is limited to 3.5 times the respective fixed salary.

In addition, separate maximum amounts are set for the variable compensation components. In the business year 2023, the maximum compensation level was not exceeded.

1.4.1. Variable remuneration

The variable annual bonus may not exceed 80 % of the fixed salary; this also holds true if the target achievement exceeds over 100 %.

1.4.2. Phantom stocks

The granted cash compensation upon exercise of the phantom stocks is limited to three times the exercise price of each phantom stock. In addition, the granted cash compensation from the phantom stocks programs within a period of one year may not exceed the amount of the annual fixed salary. This also holds true if exercise tranches become due within one year, which result from phantom stock programs from different years.

1.4.3. One-off compensation

A potential extraordinary payment granted by the Supervisory Board may only amount to half of the fixed salary and is subject to the overall limit of the compensation, which the member of the Executive Board may receive during the course of one year.

2. Compensation for the business year 2023

The Company uses the vesting-oriented view for "compensation granted". Accordingly, compensation is (already) stated in the compensation report for the financial year in which the activity on which the compensation is based (one or more years) was fully performed. This view enables a meaningful comparison, as, for example, the variable short-term remuneration for the year 2023 is set against the earnings situation of the financial year 2023.

2.1. Fixed salary

The contractually agreed annual fixed compensation of the Executive Board members in the fiscal year 2023 was € 440 thousand for the Chairman of the Executive Board Dr.-Ing. Stefan Rinck and € 300 thousand for Mr. Markus Ehret.

The amount of the fixed compensation depends on the function on the Executive Board and the length of service on the Executive Board.

2.2. Short-term variable compensation

In addition to the fixed salary, the company grants the members of the Executive Board an annually set variable gross compensation ("Bonus"). The respective amount is determined by the Supervisory Board for the respective business year on the basis of annually agreed targets.

The target agreements for the 2023 financial year were concluded on May 9, 2023. These include financial, operational and strategic targets. On March 14, 2024, the Supervisory Board assessed the goal achievement and determined an achieved level of 30 % overall for Dr.-Ing. Stefan Rinck and also 30 % for Markus Ehret. This results in a variable compensation of € 106 thousand and € 72 thousand, respectively.

The activity on which the variable compensation is based was performed in full by the balance sheet date.

The variable compensation is therefore classified as granted for the 2023 financial year, even if the payment is not made until after the completion of the 2023 financial year.

2.3. Long-term variable compensation (phantom stocks)

The Company grants the members of the Executive Board each year phantom stocks pursuant to the phantom stock program resolved by the Supervisory Board.

The phantom stocks for fiscal year 2022 were issued November 16, 2023. The late issue was due to the fact that the 2022 annual financial statements were not published until October 31, 2023. Dr.-Ing. Stefan Rinck was granted 150,000 phantom stocks and Markus Ehret 100,000 phantom stocks.

In the 2023 financial year, the Executive Board did not exercise any phantom stocks from previous years' programs.

At the end of fiscal year 2023 Dr.-Ing. Stefan Rinck held 600,000 phantom stocks, which are composed as follows: (i) 150,000 phantom stocks granted under the 2019 program, (ii) 150,000 phantom stocks granted in fiscal 2020, (iii) 150,000 phantom stocks granted in fiscal 2022 and (iv) 150,000 phantom stocks granted in fiscal 2023.

Markus Ehret held 400,000 phantom stocks, which are composed as follows: (i) 100,000 phantom stocks granted under the 2019 program, (ii) 100,000 phantom stocks granted in fiscal 2020, (iii) 100,000 phantom stocks granted in fiscal 2022, (iv) 100,000 phantom stocks granted in fiscal 2023.

The terms and exercise prices of the individual tranches are shown in the following table:

The allocation of the fair value of the phantom stocks on an accrual basis led to income of € 22 thousand in the 2023 financial year. Dr.-Ing. Stefan Rinck's phantom stocks accounted for income of € 13 thousand and Markus Ehret's phantom stocks accounted for income of € 9 thousand.

The activity on which the long-term, variable compensation is based was performed in full by the balance sheet date. The long-term, variable compensation is therefore classified as granted for the 2023 financial year, even if issuance of the phantom stocks is not made until after the completion of the 2023 financial year.