Invitation

Annual General Meeting of Shareholdersof LEM HOLDING SA
Thursday, 24 June 2021, at 14:30 (CEST)

2021

Invitation to the Annual
General Meeting of
Shareholders 2021 of
LEM HOLDING SA

LEM’s Board of Directors is pleased to announce
the Annual General Meeting of Shareholders 2021.

Date and timeThursday, 24 June 2021
at 14:30 (CEST)Place

LEM HOLDING SA, chemin des Aulx 8, 1228 Plan-les-Ouates

FormatRestricted, without the attendance of shareholders in person

Special Notice

Based on Article 27 of the Ordinance 3 of the Swiss Federal Councilof 19 June 2020 on Measures to Combat the Coronavirus, the Board of
Directors regrettably had to decide to hold the Annual General Meetingof Shareholders 2021 of LEM HOLDING SA without the attendanceof shareholders. Consequently, you are required to exercise your voting
rights by instructing the Independent Representative.

LEM Invitation to the Annual General Meeting of Shareholders 2021

3

life
energymotionLeading the world inelectrical measurement,
LEM engineers the bestsolutions for energy
and mobility, ensuringthat our customers’
systems are optimized,
reliable and safe.

Agenda and proposals
1

Explanation: The Board of Directors proposes the distribution of an
ordinary dividend of CHF 42 per share. Net of the Swiss withholding tax
of 35%, this is an ordinary net cash dividend of CHF 27.3 per share.
The shares will be traded ex-dividend as of 01 July 2021. The net
dividend will be paid on 06 July 2021.

Reporting for financial year 2020/21– Management report– Consolidated financial statements of the LEM Group– Annual financial statements of LEM HOLDING SA– Compensation report– Auditors’ reports

Shares held by LEM HOLDING SA or any of its subsidiaries are notentitled to dividends.

3

1.1 Approval of the management report, the consolidated financial
statements of the LEM Group, the annual financial statements of
LEM HOLDING SA as at 31 March 2021
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.

Proposal: The Board of Directors proposes that the members of theBoard of Directors and the Executive Management be granted discharge
for the financial year 2020/21.

4

Approval of the compensationof the Board of Directors

1.2 Consultative vote on the compensation report 2020/21
Proposal: The Board of Directors recommends that the compensation
report as per pages 54 to 59 of the Financial Report be accepted(non-binding consultative vote).

Proposal: The Board of Directors proposes that the shareholders approvea maximum aggregate amount of compensation of the members of theBoard of Directors for the term of office from the Annual General Meeting
2021 until the Annual General Meeting 2022 of CHF 1’100’000.

Explanation: The compensation report contains the principles
governing the compensation paid to the Board of Directors andthe Executive Management and reports on the amounts paid
to the members of both bodies for the financial year 2020/21.

Explanation: The proposed maximum aggregate amount of CHF
1’100’000 is composed of the following (non-binding) components:– Gross fixed compensation of CHF 910’000 based on the grossBoard of Directors membership fees (CHF 250’000 for the
Chairman and CHF 80’000 for each member) and the Committee
membership fees (CHF 40’000 for the Committee’s chairman and
CHF 20’000 for each member) for the six members of the Boardof Directors’ proposed re-election under agenda item 7 below.
For further details on the compensation system of the Boardof Directors, please refer to the compensation report 2020/21,
pages 54 to 59 of 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 contributions due toa change of applicable contribution rates.

2

Appropriation of available earningsand distribution

Proposal: The Board of Directors proposes that the total available
earnings for the financial year 2020/21 of LEM HOLDING SA be
allocated as follows:in CHF thousands

Balance brought forward from previous financial year

67’884

Variation of treasury shares(575)

Net profit of the financial year

57’520Total available earnings

124’829

Proposal of the Board of Directors
Ordinary dividend 1
Balance to be carried forward(47’880)
76’949Dividend-bearing shares are all shares issued except for treasury shares held by LEM HOLDING SA andits subsidiaries as of the record date. The amount of CHF 47’880 presented is calculated on the total
number of shares issued as of 31 March 2021. If the total amount of the ordinary dividend is higher orlower, the difference will be balanced through the appropriation of the available earnings reserve.

16Discharge of the Board of Directors
and the Executive Management

LEM Invitation to the Annual General Meeting of Shareholders 2021

Members of the Board of Directors do not receive any variable compensation. The actual payout to the members of the Board of Directors forthe term of office from the Annual General Meeting 2021 until the Annual
General Meeting 2022 will be disclosed in the compensation report
2021/22.

LEM Invitation to the Annual General Meeting of Shareholders 2021

7

5

Approval of the compensationof the Executive Management

The approval of the compensation of the members of the Executive
Management is divided into 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 financial
year 2020/21 (retrospective 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 financial year 2021/22 (prospective approval) to be paid out in July2024.
3. The third approval relates to the maximum fixed compensation of themembers of the Executive Management for the period from 1 October
2021 to 30 September 2022 (prospective approval).
5.1 Vote on the aggregate amount of short-term variable compensationof the Executive Management for financial year 2020/21
Proposal: The Board of Directors proposes that the shareholders approvean aggregate amount of short-term variable compensation of the members of the Executive Management for the preceding completed financial
year 2020/21 of CHF 984’332.
Explanation: The proposed amount of CHF 984’332 is composedof the following components:– Gross short-term variable compensation of the membersof the Executive Management for the financial year 2020/21
of CHF 894’847; plus
– Related employer contributions to social security of CHF 89’485.
For further details, please refer to the compensation report 2020/21,
pages 54 to 59 of the Financial Report.
5.2 Vote on the maximum aggregate amount of long-term
variable compensation of the Executive Management for
financial year 2021/22
Proposal: The Board of Directors proposes that the shareholders approvea maximum aggregate amount of long-term variable compensation to
be granted to the members of the Executive Management for financial
year 2021/22 of up to CHF 1’870’000.

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LEM Invitation to the Annual General Meeting of Shareholders 2021

Explanation: The proposed maximum amount of CHF 1’870’000 iscomposed of the following (non-binding) components:– Maximum gross long-term variable compensation under the
Leadership for Results (L4R) plan of the members of the
Executive Management. This maximum amount assumes that all
performance targets will be reached at the maximum possiblelevel under the L4R LTI (Long-Term Incentive) plan rules of
CHF 1’700’000; plus
– Estimated related employer contributions to social securityof CHF 170’000.
The L4R LTI plan is an annual long-term incentive plan, which is basedon the performance of LEM evaluated over a period of three consecutive
fiscal years. The performance criterion is the cumulated economic value
added (EVA) over these three fiscal years. For further details, please referto the compensation report 2020/21, pages 54 to 59 of the Financial
Report.
The actual payout to the members of the Executive Management for
grants awarded during financial year 2021/22 will be disclosed in thecompensation report 2023/24.
5.3 Vote on the maximum aggregate amount of fixed compensationof the Executive Management for the period from 1 October 2021
to 30 September 2022
Proposal: The Board of Directors proposes that the shareholders approvea maximum aggregate amount of fixed compensation for the membersof the Executive Management for the period from 1 October 2021 to 30
September 2022 of up to CHF 2’600’000.
Explanation: The proposed maximum amount of CHF 2’600’000 is composed of the following (non-binding) components:– Gross base salaries of the members of the Executive Managementof CHF 2’160’000; plus
– Related employer contributions to social security and pension
fund of CHF 440’000.
The actual payout to the members of the Executive Management for theperiod from 1 October 2021 to 30 September 2022 will be disclosed in
the compensation reports 2021/22 and 2022/23, respectively.

LEM Invitation to the Annual General Meeting of Shareholders 2021

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6

Amendment to the Articles of Incorporation

Proposal: With the purpose of allowing more flexibility for the shareholders of LEM HOLDING SA in the election or re-election of members of
the Board of Directors, while keeping such flexibility limited to justified
exceptional cases, the Board of Directors proposes to amend the Article
17, last paragraph, of the Articles of Incorporation as follows:
Old version
Original version in French: L’âge limite pour remplir la fonction de membre du conseil d’administration de la société est fixé à septante ans (70)révolus. Un membre du conseil d’administration ne peut ainsi être éluou réélu s’il a déjà atteint cet âge limite au moment de son élection ou
réélection.
Free translation in English: The age limit for exercising the function ofmember of the board of directors of the company is fixed at seventy
years (70). Thus, a member of the board of directors may not be electedor re-elected if the age limit has already been reached at the time ofelection or re-election.
New version
Original version in French: En règle générale, l’âge limite pour remplir lafonction de membre du conseil d’administration de la société est fixé
à septante ans (70) révolus. Un membre du conseil d’administration nepeut ainsi généralement être élu ou réélu s’il a déjà atteint cet âge limite
au moment de son élection ou réélection. Toutefois, il est possible dedéroger à cette règle dans des cas exceptionnels et fondés.
Free translation in English: In general, the age limit for exercising thefunction of member of the board of directors of the company is fixedat seventy years (70). Thus, a member of the board of directors may
generally not be elected or re-elected if the age limit has already beenreached at the time of election or re-election. However, it is possible toderogate from this rule in justified exceptional cases.

7

Re-elections of members of the Board of
Directors, re-election of the Chairman of theBoard of Directors

Proposal: The Board of Directors proposes the re-election of– Ilan Cohen as member– Ulrich Jakob Looser as member– Ueli Wampfler as member, subject to approval of agenda item 6– Werner Carl Weber as member– François Gabella as member– Andreas Hürlimann as member and Chairman (one single vote)

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LEM Invitation to the Annual General Meeting of Shareholders 2021

to the Board of Directors for a term of office of one year extending until
completion of the next Annual General Meeting.
Re-elections of the proposed nominees will be held individually.
Explanation: The mandates of all members of the Board of Directors will
expire at the end of the Annual General Meeting of 24 June 2021.
Ueli Wampfler turned 70 during the preceding financial year. Considering
the most valuable services provided by Ueli Wampfler to LEM as memberof the Board of Directors and his wide knowledge of LEM’s businessand culture, the Board of Directors proposes Ueli Wampfler’s re-election
based on the new Article 17, last paragraph, of the Articles of Incorporation (subject to its approval by the shareholders under agenda item 6).
For further details on the nominees as well as their qualifications, seebiographies in the corporate governance report 2020/21, pages 44 to 53
of the Financial Report.

8

Re-elections to the Nomination & Compensation
Committee

Proposal: The Board of Directors proposes the re-election of– Ulrich Jakob Looser– Andreas Hürlimannto the Nomination & Compensation Committee for a term of office of one
year extending until completion of the next Annual General Meeting. In
case of re-election, Ulrich Jakob Looser will be appointed as chairman of
the Nomination & Compensation Committee.
Re-elections of the proposed nominees will be held individually.

9

Re-election of the Independent Representative

Proposal: The Board of Directors proposes the re-election of the law
firm Hartmann Dreyer, Attorneys-at-law, Boulevard de Pérolles 7, 1701
Fribourg/Freiburg, Switzerland, as Independent Representative for aterm of office of one year extending until completion of the next Annual
General Meeting.

10 Re-election of the statutory auditors

Proposal: The Board of Directors proposes the re-election of Ernst &Young Ltd., Lancy, as statutory auditors for the financial year 2021/22.

LEM Invitation to the Annual General Meeting of Shareholders 2021

11

Organizational information

Annual report

The annual report 2020/21 is available in two documents. The first is
the Annual Review, which is effectively the management report on theyear’s performance. The second is the Financial Report, consistingof the consolidated financial statements of the LEM Group, theannual financial statements of LEM HOLDING SA, the compensation
report, the corporate governance report and the reports of thestatutory auditors. Both documents can be accessed on LEM’s website
https://www.lem.com/en/investors and select > Financial Reports.
A hard copy of the Annual Review is sent to shareholders. A hard copyof the Financial Report is sent to shareholders upon request to
LEM HOLDING SA, c/o areg.ch ag, Fabrikstrasse 10, 4614 Hägendorf,
Switzerland. The full annual report is also available for inspection from02 June 2021 at the registered office of LEM HOLDING SA, which islocated at chemin des Aulx 8, 1228 Plan-les-Ouates, Switzerland.
The annual report 2020/21 is only available in English.

Written proxies and voting instructions

The enclosed registration form may be used as power of attorney to
the Independent Representative and for voting instructions. Both haveto be returned by enclosed envelope not later than 18 June 2021 to
LEM HOLDING SA, c/o areg.ch ag, Fabrikstrasse 10, 4614 Hägendorf,
Switzerland.
To the extent you do not provide specific instructions to the Independent Representative, you instruct the Independent Representative tovote your shares in favor of the proposals of the Board of Directors
with respect to the items listed on the agenda. The same shall apply for
additional or alternative proposals to the agenda items included in thisinvitation and for new agenda items.

Electronic proxies and voting instructions

Alternatively, shareholders have the possibility to cast their votes by issuing electronic proxies and voting instructions to the Independent Representative via Netvote: www.netvote.ch/lem. Shareholders may provide
or change any voting instructions they have communicated electronically
until but not later than 18 June 2021 at 23:59 (CEST). The e-voting fact
sheet and requisite login data are part of the enclosed meeting materials
supplied to the shareholders.

Voting entitlement

Those shareholders entered in the share register on 15 June 2021,
17:00 (CEST) are entitled to vote.
From 15 June 2021, 17:00 (CEST) up to and including 24 June 2021,
no entries will be made in the share register which would create a rightto vote at this year’s Annual General Meeting. Shareholders who sellpart or all of their shares before the Annual General Meeting are nolonger entitled to vote to that extent.

Proxies to the Independent Representative

Considering the evolution of the Coronavirus pandemic, shareholders
are not permitted to attend the Annual General Meeting 2021 of LEM
HOLDING SA in person. Shareholder voting rights can exclusively be
exercised through the Independent Representative, Hartmann Dreyer,
Attorneys-at-law, Boulevard de Pérolles 7, P.O. Box 736, 1701 Fribourg/
Freiburg, Switzerland. No entry cards may be ordered and admission to
the Annual General Meeting in person will not be granted.

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LEM Invitation to the Annual General Meeting of Shareholders 2021

LEM Invitation to the Annual General Meeting of Shareholders 2021

13

Correspondence

We kindly request that shareholders submit any correspondence
in connection with the Annual General Meeting by priority mail to
LEM HOLDING SA, c/o areg.ch ag, Fabrikstrasse 10, 4614 Hägendorf,
Switzerland.

Invitation

This invitation will be published in the Swiss Commercial Gazetteon 02 June 2021.
Plan-les-Ouates, 19 May 2021
On behalf of the Board of Directors of LEM HOLDING SA

Andreas Hürlimann,
Chairman of the Board of Directors
LEM HOLDING SA
Chemin des Aulx 81228 Plan-les-Ouates
Switzerland
Phone: +41 22 706 11 11
www.lem.com

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LEM Invitation to the Annual General Meeting of Shareholders 2021

LEM HOLDING SA
Chemin des Aulx 81228 Plan-les-Ouates
GenevaSwitzerland
www.lem.com