Tesmec S p A : Report on Remuneration 2023

REPORT ON REMUNERATION POLICY AND REMUNERATION PAID

(PREPARED PURSUANT TO ARTICLES 123-TER OF THE CONSOLIDATED LAW ON FINANCE (T.U.F.) AND 84-QUATER OF THE ISSUERS' REGULATION AS WELL AS ARTICLE 5 OF CORPORATE GOVERNANCE CODE PROMOTED BY BORSA ITALIANA S.P.A.)

APPROVED BY THE BOARD OF DIRECTORS OF TESMEC S.P.A. ON 8 MARCH 2024

GLOSSARY

Corporate Governance Code or Code	The Corporate Governance Code of Listed Companies adopted on January 2020 by the Corporate Governance Committee of Listed Companies and promoted by Borsa Italiana, ABI, Ania, Assogestioni, Assonime and Confindustria.
Remuneration and Appointments Committee or Committee	The Remuneration and Appointments Committee set up by Tesmec in accordance with the Corporate Governance Code.
Board of Directors or Board	The Board of Directors of Tesmec.
Board of Statutory Auditors	The Board of Statutory Auditors of Tesmec.
Executives with Strategic Responsibilities	The executives with strategic responsibilities as defined by the pro tempore regulations in force on Related Party transactions
Group	Tesmec and the companies controlled by it pursuant to Article 93 of the Consolidated Law on Finance (T.U.F.)
Remuneration Policy or Policy	The Remuneration Policy prepared by the Remuneration and Appointments Committee for the meeting of 5 March 2024 and approved on 8 March 2024 by the Board of Directors, as described in Section I of this Report. The Remuneration Policy thus prepared and approved will be submitted for approval by a binding vote of the Ordinary Shareholders' Meeting convened to be held on 18 April 2024.
Regulation of the Committee	The Regulation of the Remuneration and Appointments Committee.
Issuers' Regulation	The Regulation issued by CONSOB with resolution no. 11971 of 14 May 1999 on issuers, as subsequently amended and supplemented.
Related Party Regulation	The regulation issued by CONSOB with Resolution no. 17221 of 12 March 2010, concerning transactions with related parties, as subsequently amended and supplemented.
Report	This report on remuneration policy and remuneration paid drawn up pursuant to Articles 123-ter of the Consolidated Law on Finance (T.U.F.) and Article 84-quater of the Issuers' Regulation as well as in compliance with Article 5 of the Corporate Governance Code.
Tesmec or Company or Issuer	Tesmec S.p.A.
Consolidated Law on Finance (T.U.F.)	Italian Legislative Decree no. 58 of 24 February 1998 as subsequently amended and supplemented.

TABLE OF CONTENTS

Introduction 5

GLOSSARY 2

TABLE OF CONTENTS 4

INTRODUCTION 6

SECTION I: REMUNERATION POLICY 7

1. Remuneration policy for members of the administrative bodies, general manager and other 7

executives with strategic responsibilities 7a) Bodies or subjects involved in the preparation and approval and possible review of the RemunerationPolicy, by specifying their roles, as well as bodies and subjects in charge of the correct implementationof this Policy............................................................................................................................................................................ 7b) Intervention of the Remuneration and Appointments Committee, composition (distinguishing thenon-executive directors from the independent directors), relevant responsibilities and operationprocedures and any other measured aimed at avoiding or managing conflicts of interests......................... 8

• c) Name of the independent experts, if any, who took part in the preparation of the Remuneration Policy...................................................................................................................................................................................... 8

• d) Purposes of the Remuneration Policy, principles on which it is based, duration, consideration of theremuneration and working conditions of employees in determining them and, in the event of a review,description of any change compared to the Remuneratio Policy last submitted to the Shareholders'Meeting and how the review takes into account the votes and assessment expressed by the shareholdersduring the meeting or thereafter...................................................................................................................................... 9e) Description of the policies regarding fixed and variable components of remuneration, with particularregard to the indication of their relative proportion in the overall remuneration and distinguishingbetween short and medium/long term variable componens................................................................................. 10

• f) Policy followed with regard to non-monetary benefits ...................................................................................... 12

• g) With reference to variable components, description of the financial and non-financial performance targets, where appropriate, taking into account criteria relating to corporate social responsibility, according to which they are assigned, distinguishing short-term variable components from medium to long-term variable components, and information on the relation between the change in the results and the change in the remuneration ...................................................................................................................................... 13 h) Methods used for assessing the achievement of performance targets at the basis of the allocation of shares, options, other financial instruments or other variable components of remuneration, specifying the extent of the variable component to be disbursed in accordance with the level of achievement of the objectives. .............................................................................................................................................................................. 13 i) Information aimed at highlighting the contribution of the Remuneration Policy and, in particular, of the policy on variable remuneration components, to the company strategy, to the pursuit of the long-term interests and to the Sustainability of the Compay .......................................................................................... 13 j) Vesting periods, any deferred payment systems, with indication of deferment periods and the criteria used for determining such periods and, if provided for, ex-post correction mechanisms of the variable component (malus or return of "claw-back" variable compensation) .................................................................. 13 k) Information on any clause for the retention of the financial instruments in the portfolio after their acquisition, by indicating the periods of retention and the criteria used for determining such periods .14 l) Policy related to the treatments contemplated in case of termination of office or of the employment relationship ........................................................................................................................................................................... 14 m) Information on the presence of insurance, or social security or pension coverage, other than compulsory insurance ........................................................................................................................................................ 15

n) (i) Remuneration policy possibly followed with reference to:(i) independent directors, (ii) the attendance to committees and (iii) the carrying-out of special offices (chairman, vice chairman, etc.)... 15 o) Instructions on the possible use, as reference, of the remuneration policies of other companies for defining the Remuneration Policy ................................................................................................................................... 16 p) Elements of the Remuneration Policy from which, in the presence of exceptional circumstances, it is possible to depart and any further procedural conditions under which the departure can be applied .... 16

2. Remuneration policy for members of the Board of Statutory Auditors

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SECTION II - REMUNERATION PAID DURING THE 2021 FINANCIAL PERIOD TO THE MEMBERS OF THE BOARD OF DIRECTORS AND OF THE BOARD OF STATUTORY AUDITORS, TO GENERAL MANAGER AND EXECUTIVES

WITH STRATEGIC RESPONSIBILITIES 18

FIRST PART - ITEMS FORMING THE REMUNERATION 18

• 1.1 Items forming the remuneration ...................................................................................................................... 18

• 1.1.1 Board of Directors ................................................................................................................................................. 18

• 1.1.2 Board of Statutory Auditors ................................................................................................................................ 19

• 1.1.3 General Manager and Executives with Strategic Responsibilities ........................................................... 20

• 1.2 Allocation of indemnities or other benefits for termination of office or for the termination of the

employment relationship during the year .................................................................................................................... 20

• 1.3 Derogations to the Remuneration Policy ........................................................................................................ 20

• 1.4 Potential application of ex post correction mechanisms of variable component (malus or return

of "claw-back" variable compensation) ......................................................................................................................... 20

• 1.5 Comparison information for previous years ................................................................................................. 21

• 1.6 Shareholders' vote on the second section of the report on policy of remuneration and

compensation paid in the previous financial period ................................................................................................. 24

SECOND PART - TABLES

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Table 1: Remuneration paid to the members of the Board of Directors and Board of Statutory Auditors, to the General Manager and Executives with Strategic Responsibilities, during the 2021 financial period 26

Table 2: Monetary incentives plans for the members of the Board of Directors, the General Manager andExecutives with Strategic Responsibilities

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Table 3: Information on the equity investments of the members of the Board of Directors, of the Board of Statutory Auditors, of the General Manager and of the Executives with Strategic Responsibilities 30

INTRODUCTION

This report on remuneration policy and remuneration paid to members of the board of directors and supervisory bodies, general manager and executives with strategic responsibilities (the "Report") was drafted and approved by the Board of Directors of Tesmec S.p.A. (hereinafter also "Tesmec" or the "Company") on 8 March 2024 pursuant to: (i) art. 123-ter of Italian Legislative Decree no. 58 of 24 February 1998 ("T.U.F."), amended by Italian Legislative Decree no. 49 of 10 June 2019, implementing Directive EU 2017/828 ("Shareholder Rights Directive II") of the European Parliament and of the Council of 17 May 2017 amending Directive 2007/36/EC ("Shareholder Rights Directive I") as regards the encouragement of long-term shareholder engagement; (ii) Article 84-quarter of the regulations issued by CONSOB with resolution no. 11971 of 14 May 1999 as subsequently amended and supplemented, ("Issuers' Regulation") and of related Annex 3A, schemes no. 7-bis and 7-ter;

Section I of the Report describes in a clear and comprehensible manner the remuneration policy ("Remuneration Policy" or "Policy") of Tesmec and of the group it heads (the Company and the Company's subsidiaries pursuant to article 93 of the Consolidated Law on Finance (T.U.F.), hereinafter also the "Group") with regard to the issue of remuneration with reference to the 2024 financial year of:

• 1. the members of the Board of Directors and Board of Statutory Auditors;

• 2. the General Manager;

• 3. the Executives with Strategic Responsibilities, i.e. individuals who have the authority and responsibility for planning, directing and controlling the activities of the Companies of the Group, either directly or indirectly, as defined by the pro tempore regulations in force on Related Party transactions ("Executives with Strategic Responsibilities");

as well as the procedures used to adopt and implement the Remuneration Policy, pursuant to Article 123-ter, third paragraph of the Consolidated Law on Finance (T.U.F.).

In accordance with Article 123-ter, fourth paragraph of the Consolidated Law on Finance (T.U.F.), Section II of the Report shows in a clear and comprehensible manner the individual items making up the remuneration of the members of the Board of Directors and of the Board of Statutory Auditors, the General Manager and the Executives with Strategic Responsibilities and respective remuneration paid in 2023 by the Company and by subsidiaries or associates (Tables 1 and 2).

Finally, any shares held in the Company and its subsidiaries by the subjects mentioned above are indicated in Table 3 attached to this Report.

As provided by the Related Party Regulation, as acknowledged in the procedure adopted by the Company in this regard and available on its website(www.tesmec.com), the approval of this Policy by the Shareholders' Meeting, once defined by the Board of Directors on proposal of the Remuneration and Appointments Committee (comprised exclusively by non-executive Directors, mostly Independent), where the remuneration awarded is identified in accordance with this Policy and quantified on the basis of criteria that do not involve discretionary assessments, exempts the resolutions of the Company on the remuneration of its directors and Executives with strategic responsibilities from carrying out the procedures provided by the above provisions of CONSOB concerning related parties.

SECTION I: REMUNERATION POLICY

1. Remuneration policy for members of the administrative bodies, general manager and other

Executives with Strategic Responsibilities

a) Bodies or subjects involved in the preparation and approval and possible review of the

Remuneration Policy, by specifying their roles, as well as bodies and subjects in charge of the correct implementation of this Policy

The Board of Directors defines and reviews the Remuneration Policy on proposal of the Remuneration and Appointments Committee (see below under letter b) of Section I of this Report) on an annual basis.

The Remuneration Policy, as described in this Section of the Report, pursuant to Article 123-ter, paragraphs 3-bis and 3-ter, of the Consolidated Law on Finance (T.U.F.), introduced by Italian Legislative Decree no. 49/2019, is subject, on an annual basis or on the occasion of amendments to the Policy, to the binding vote of the Ordinary Shareholders' Meeting convened pursuant to Article 2364, second paragraph, of the Italian Civil Code.

The Company assigns remuneration only in accordance with the Remuneration Policy last approved by the Shareholders' Meeting. In the presence of exceptional circumstances, the Company can temporarily depart from the Remuneration Policy, in compliance with the procedural conditions - provided for therein - under which the departure may be applied and with regard to the elements of the Policy as specified therein that may be departed from (see below under letter p) of Section I of this Report).

Exceptional circumstances are understood only as situations in which the departure from the Remuneration Policy is required to pursue the long-term interests and sustainability of the Company as a whole or to ensure its ability to stay on the market, both as a reference market of the Company (i.e. design, production and marketing of products, technologies and solutions integrated in the construction, maintenance and efficiency of infrastructure related to the transport and supply of energy, data and materials), and as a labour and human resources market.

If the Shareholders' Meeting does not approve the Remuneration Policy submitted to the relevant vote, the Company continues to pay remuneration in accordance with the most recent Remuneration Policy approved by the Shareholders' Meeting or, failing this, can continue to pay remuneration in accordance with current practice (intended as the choices already made by the Company in relation to the remuneration policy which may also be inspired by market practices, such as those recommended in the conduct codes to which the Company declared to adhere). In this case, the Company submits a new Remuneration Policy to the vote of the Shareholders' Meeting at the latest at the next Shareholders' Meeting convened pursuant to Article 2364, second paragraph of the Italian Civil Code.

The Remuneration and Appointments Committee is in charge of the correct implementation of this Policy, as well as the Chief Executive Officer and the Board of Directors. The Board of Statutory Auditors is responsible for supervising the actual implementation of the Policy.

b)Intervention of the Remuneration and Appointments Committee, composition (distinguishing the non-executive directors from the independent directors), relevant responsibilities and operation procedures and any other measured aimed at avoiding or managing conflicts of interests.

The Remuneration and Appointments Committee, which formulated to the Board of Directors the Remuneration Policy proposal, consists of three directors, all non-executive and predominantly independent, as provided for by the Code and by the Regulations of the Committee itself. The members of the Remuneration and Appointments Committee include directors who have adequate knowledge and experience in financial and remuneration policy matters, assessed at the time of appointment.

As at the date of the Report, the Remuneration and Appointments Committee is composed of 3 non-executive members, two of which are independent: Emanuela Teresa Basso Petrino (Chairman - independent), Antongiulio Marti (Member - non-executive), Simone Andrea Crolla (Member - independent).

The Remuneration and Appointments Committee is entrusted with the following functions related to the Remuneration Policy:

• - it periodically evaluates the adequacy, the overall consistency and the practical application of the Remuneration Policy, by making use in this regard of the information supplied by the chief executive officers; it makes proposals to the Board of Directors on the matter;

• - it submits proposals or expresses opinions to the Board of Directors on the remuneration of executive directors and other directors holding special offices as well as on the setting of performance targets related to the variable component of this remuneration;

• - it monitors the implementation of the decisions adopted by the Board itself by making sure, in particular, that the performance targets are actually achieved;

• - it ensures suitable functional and operational connections with the competent company structures; and

• - it reports to the Company's shareholders on the exercise of its functions.

In accordance with the provisions of Recommendation 26 of the Corporate Governance Code, no Director attends the meetings of the Remuneration and Appointments Committee where proposals are submitted to the Board of Directors regarding their remuneration.

The Committee meets at least once a year and in any case on the occasion of the meeting of the Board of Directors called to decide on the remuneration of the Chief Executive Officers or vested with special offices and/or of the top management of the Company as well as on any stock option plan or share allocation.

c)Name of the independent experts, if any, who took part in the preparation of the Remuneration Policy

The Board of Directors did not avail itself of the advice of independent experts in the preparation of the Remuneration Policy.

d)Purposes of the Remuneration Policy, principles on which it is based, duration, consideration of the remuneration and working conditions of employees in determining them and, in the event of a review, description of any change compared to the Remuneration Policy last submitted to the Shareholders' Meeting and how the review takes into account the votes and assessment expressed by the shareholders during the meeting or thereafter.

The Remuneration Policy (and the relative implementation procedures) was prepared by the Remuneration and Appointments Committee in the meeting of 5 March 2024 and on 8 March 2024 it was approved by the Board of Directors. The Remuneration Policy thus prepared and approved will be submitted for approval by a binding vote of the Ordinary Shareholders' Meeting convened to be held on 18 April 2024.

The Remuneration Policy contributes to the Company's strategy, the pursuit of the Company's interests, including long-term, and sustainability, illustrating the way in which it makes this contribution and taking into account the remuneration and employment conditions of the Company's employees.

The Remuneration Policy serves to attract, motivate and retain resources with the professional qualities required to profitably pursue the Company's objectives. The Policy serves also as a means to align the interests of management and of shareholders, through the creation of a strong relation between remuneration and individual performance. The aim of the Policy is to create sustainable value in the medium to long term for the Issuer and the shareholders, as well as to ensure that the remuneration is based on the results actually obtained.

For non-executive directors, the Remuneration Policy envisages, in compliance with the provisions of Recommendation 29 of the Corporate Governance Code, remuneration that is adequate to the competence, professionalism and commitment required by the tasks assigned to them within the management body and in board committees; this remuneration is not linked to the economic results achieved by the Company (see paragraph o below).

When determining remuneration and each of its components, the Board of Directors will take account (i) of the specific contents of the delegation of powers assigned to each executive director and/or (ii) of the functions and of the role actually carried out by each executive director within the company, making sure in this way that the estimate of any variable component is consistent with the type of tasks assigned to them.

In particular, remuneration is determined according to the following criteria:

• - the indications on the consistency between the elements underlying the calculation of the remuneration and the set objectives;

• - the correct balance between the fixed and variable component must be in accordance with the strategic objectives and with the risk management policy of the Company, also taking account of the sector in which it operates and the nature of the business practically carried out;

• - the performance targets - i.e. the economic results and any other specific target - to which the disbursement of the variable components is related are predetermined, measurable and related to the creation of value for shareholders in the medium-long term.

The Remuneration Policy is defined in consideration of the fee, working conditions and remuneration assessments of employees and provides top management with an overall remuneration structure commensurate, for the fixed part, with their role and responsibilities and, for the variable part, with the contribution given to the Company in terms of results actually achieved with respect to both short and medium-long term objectives, and always in line with the defined strategies.

The Shareholders' Meeting held on 20 April 2023, in accordance with the regulations in force, approved the Remuneration Policy for the 2023 financial period described in Section I of the report on the policy of remuneration and compensation paid published in 2023, with a 96,5% of the attendees voting in favour, substantially in line with that obtained at previous Shareholders' Meetings.

The vote was thus almost unanimously in favour, rewarding accordingly the remuneration policy for the 2023 financial period.

Compared to the remuneration policy relating to the 2023 financial period, which was approved on 10 March 2023 by the Board of Directors and submitted to the Shareholders' Meeting of Tesmec on 20 April 2023, there were no changes in the Remuneration Policy, except for the greater importance attributed to profitability and cash generation as part of the performance targets and as indicated in the following paragraphs of Section I of this Report.

e)Description of the policies regarding fixed and variable components of remuneration, with particular regard to the indication of their relative proportion in the overall remuneration and distinguishing between short and medium/long term variable components

The remuneration of the Chief Executive Officer, of the General Manager and of the Executives with Strategic Responsibilities consists in general of the following elements:

• - a gross fixed annual component; and

• - a variable component as an incentive and loyalty tool also suitable to ensure an optimal level of correlation between the remuneration of management and the economic and financial results of the Company in the medium-long term.

In compliance with the provisions of the Corporate Governance Code, the variable component is linked to objectives consistent with the strategic objectives of the Company and aimed at promoting its sustainable success, relating, in particular, to turnover, EBITDA and the net financial position of the Company and the Group, also with a view to giving greater importance to profitability and cash generation, and the achievement of certain milestones regarding the environment, sustainability and conscious consumption.

Moreover, in line with Recommendation no. 27 d) of the Corporate Governance Code, the Remuneration Policy requires the payment of a significant component of the variable remuneration to be deferred over time, in line with the characteristics of the business and with the related risk profiles.

As anticipated, the methods for defining the variable remuneration for executive directors, the Chief Executive Officer and the Executives with Strategic Responsibilities will be established by the Board of Directors on the basis of the sustainability policy adopted by the Company and of budget for the financial period with the estimate of a minimum threshold to receive the bonus and a progression in the premium pay to be assigned in accordance with the lines described below.

It is understood that, in accordance with the Policy, the possibility for such payment to be waived by the parties concerned is without prejudice in the event of achievement of the targets to which the payment of the variable component of remuneration is subject.

Note also that the Remuneration Policy envisages the possibility for the Company to pay entry bonuses to encourage the hiring and retention of individuals deemed to be strategic.

Finally, it should be noted that, in accordance with the recommendations of the Corporate Governance Committee as well as in line with best market practice, the Company is starting

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