STS Group AG

Erklärung des Vorstands und des Aufsichtsrats der STS GROUP AG zu den Empfehlungen der „Regierungskommission Deutscher Corporate Governance Kodex” gemäß § 161 Aktiengesetz

Vorstand und Aufsichtsrat der STS Group AG mit Sitz in Hagen (die „Gesellschaft“) erklären:

Die Gesellschaft hat den Empfehlungen der „Regierungskommission Deutscher Corporate Governance Kodex“ in ihrer letzten Fassung vom 28. April 2022, bekannt gemacht im Bundesanzeiger am 27. Juni 2022 (der „Kodex“), seit der letzten Entsprechenserklärung im Februar 2024 entsprochen und wird diesen auch künftig entsprechen, jeweils mit folgenden Ausnahmen:

1. Ziffer A.5 des Kodes:

Mit der aktualisierten Fassung des Kodex vom 28. April 2022 empfiehlt der Kodex seitdem auch, dass im Lagebericht die wesentlichen Merkmale des gesamten internen Kontrollsystems und des Risikomanagementsystems beschrieben werden sollen und zur Angemessenheit und Wirksamkeit dieser Systeme Stellung genommen werden soll.

Bereits zum Zeitpunkt der Aufstellung des Lageberichts für das Geschäftsjahr 2022 war die Aufnahme der wesentlichen Merkmale des gesamten internen Kontrollsystems und des Risikomanagementsystems sowie einer Stellungnahme zu deren Angemessenheit und Wirksamkeit in den Lagebericht eine Empfehlung des DCGK. Diese Empfehlung wurde seitdem sowohl in der Entsprechenserklärung im Februar 2023 als auch in der Entsprechenserklärung im Februar 2024 berücksichtigt Die Gesellschaft befasste sich bereits Anfang des Geschäftsjahres 2022 sowie wiederholt Anfang des Geschäftsjahres 2023 und 2024 – während der Aufstellung des Lageberichts für das jeweilige Geschäftsjahr – mit dieser Empfehlung des DCGK und befand sich diesbezüglich auch im Austausch mit der für die Aufstellung des Lageberichts beauftragten Wirtschaftsprüfungsgesellschaft der Gesellschaft. Die Gesellschaft entschied sich jedoch, sowohl im Lagebericht für das Geschäftsjahr 2021 als auch in den Lageberichten der folgenden Geschäftsjahre 2022 und 2023 gegen eine Aufnahme der vorgenannten Punkte, weil die Wirtschaftsprüfungsgesellschaft für die Abschlussprüfung bestellt wurde und zuständig ist. Bei einer Aufnahme der vorgenannten Punkte müsste die Wirtschaftsprüfungsgesellschaft jedoch das gesamte interne Kontrollsystem der Gesellschaft einer Prüfung unterziehen, für die die Wirtschaftsprüfungsgesellschaft im Grunde nicht bestellt wurde. Auch im Lagebericht für das Geschäftsjahr 2024 beabsichtigt die Gesellschaft deshalb, keine Prüfung ihres internen Kontrollsystems durch die Wirtschaftsprüfungsgesellschaft vornehmen zu lassen.

2. Ziffer B.5 des Kodex:

Der Kodex empfiehlt, dass für Vorstandsmitglieder eine Altersgrenze festgelegt und in der Erklärung zur Unternehmensführung angegeben werden soll.

Der Aufsichtsrat hat wiederholt keinen Beschluss gefasst, der eine konkrete Altersgrenze für Vorstandsmitglieder festlegt, weswegen auch keine Angabe in der Erklärung zur Unternehmensführung erfolgen kann. Der Aufsichtsrat vertritt weiterhin die Auffassung, dass bei der Auswahl von Kandidaten entscheidend ist, dass es sich um Personen handelt, die über die zur ordnungsgemäßen Wahrnehmung der Aufgaben erforderlichen Kenntnisse, Fähigkeiten sowie fachlichen und persönlichen Erfahrungen verfügen. Diese Voraussetzungen sind nach beständiger Überzeugung der Gesellschaft nicht an ein bestimmtes Alter gebunden, weswegen die Gesellschaft eine konkrete Altersgrenze für Vorstandsmitglieder weiterhin als nicht geeignet ansieht, um die erforderlichen Fähigkeiten der betreffenden Personen sicherstellen zu können.

3. Ziffer C.1 des Kodex:

Der Kodex empfiehlt, dass der Aufsichtsrat für seine Zusammensetzung konkrete Ziele benennen und ein Kompetenzprofil für das Gesamtgremium erarbeiten soll. Dabei soll der Aufsichtsrat auf Diversität achten. Das Kompetenzprofil des Aufsichtsrats soll auch Expertise zu den für das Unternehmen bedeutsamen Nachhaltigkeitsfragen umfassen. Vorschläge des Aufsichtsrats an die Hauptversammlung sollen diese Ziele berücksichtigen und gleichzeitig die Ausfüllung des Kompetenzprofils für das Gesamtgremium anstreben. Der Stand der Umsetzung soll in Form einer Qualifikationsmatrix in der Erklärung zur Unternehmensführung offengelegt werden. Diese soll auch über die nach Einschätzung der Anteilseignervertreter im Aufsichtsrat angemessene Anzahl unabhängiger Anteilseignervertreter und die Namen dieser Mitglieder informieren.

Der Aufsichtsrat hat auch im Geschäftsjahr 2024 wiederholt keinen Beschluss gefasst, der konkrete Ziele zur Zusammensetzung des Aufsichtsrates oder ein Kompetenzprofil für das Gesamtgremium, welches auch die Expertise zu den für das Unternehmen bedeutsamen Nachhaltigkeitsfragen umfasst, formuliert. Die Gesellschaft vertritt weiterhin die Auffassung, dass die derzeitige Zusammensetzung des Aufsichtsrates den Anforderungen aus Ziffer C.1 des Kodex entspricht. Dies wurde durch die Beschlussfassung zur Wiederwahl der Mitglieder des Aufsichtsrats in der ordentlichen Hauptversammlung der Gesellschaft am 13. Juni 2024 auch bestätigt. Mit Ablauf der für den 13. Juni 2024 einberufenen ordentlichen Hauptversammlung endete die Amtsperiode sämtlicher Mitglieder des Aufsichtsrats, namentlich der Herren Paolo Scudieri, Pietro Gaeta und Pietro Lardini. Vor diesem Hintergrund war eine Neu- bzw. Wiederwahl der Mitglieder des Aufsichtsrats erforderlich. Die Hauptversammlung bestätigte durch Beschluss den Vorschlag des Aufsichtsrats, die Herren Paolo Scudieri, Pietro Gaeta und Pietro Lardini bis zur Beendigung der Hauptversammlung, die über die Entlastung für das Geschäftsjahr 2026 beschließt, wieder zu Mitgliedern des Aufsichtsrats der Gesellschaft zu wählen.

Bei der Auswahl von Kandidaten, die zur Wahl in den Aufsichtsrat vorgeschlagen werden, achtet die Gesellschaft stets darauf, dass es sich um Personen handelt, die über die zur ordnungsgemäßen Wahrnehmung der Aufgaben erforderlichen Kenntnisse, Fähigkeiten sowie fachlichen und persönlichen Erfahrungen, auch in Bezug auf die die Gesellschaft betreffenden Nachhaltigkeitsfragen, verfügen. Die in der ordentlichen Hauptversammlung am 13. Juni 2024 wieder zu Mitgliedern des Aufsichtsrats gewählten Herren Paolo Scudieri, Pietro Gaeta und Pietro Lardini erfüllen aus Sicht der Gesellschaft die Anforderungen aus Ziffer C.1 des Kodex. Aus diesem Grund ist die Gesellschaft weiterhin der Überzeugung, dass festgesetzte Ziele in Bezug auf die konkrete Zusammensetzung für die Wahl eines effizienten und qualifizierten Aufsichtsrates nicht erforderlich sind.

4. Ziffer C.2 des Kodex:

Der Kodex empfiehlt, dass für Aufsichtsratsmitglieder eine Altersgrenze festgelegt und in der Erklärung zur Unternehmensführung angegeben werden soll.

Der Aufsichtsrat hat auch weiterhin keinen Beschluss gefasst, der eine konkrete Altersgrenze festgelegt, weswegen auch keine Angabe in der Erklärung zur Unternehmensführung erfolgen kann. Unter Verweis auf die vorstehenden Ausführungen zu Ziffer C.1 vertritt die Gesellschaft die Auffassung, dass bei der Auswahl von Kandidaten entscheidend ist, dass es sich um Personen handelt, die über die zur ordnungsgemäßen Wahrnehmung der Aufgaben erforderlichen Kenntnisse, Fähigkeiten sowie fachlichen und persönlichen Erfahrungen, auch in Bezug auf die die Gesellschaft betreffenden Nachhaltigkeitsfragen, verfügen. Diese Voraussetzungen sind nach fortwährender Überzeugung der Gesellschaft nicht an ein bestimmtes Alter gebunden, weswegen die Gesellschaft auch zukünftig eine konkrete Altersgrenze für Aufsichtsratsmitglieder als nicht erforderlich ansieht, um die erforderlichen Fähigkeiten der betreffenden Personen sicherstellen zu können.

5. Ziffer C.10 des Kodex:

Der Kodex empfiehlt, dass der Aufsichtsratsvorsitzende, der Vorsitzende des Prüfungsausschusses sowie der Vorsitzende des mit der Vorstandsvergütung befassten Ausschusses unabhängig von der Gesellschaft und vom Vorstand sein sollen. Der Vorsitzende des Prüfungsausschusses soll zudem auch unabhängig vom kontrollierenden Aktionär sein.

Der bisherige Aufsichtsratsvorsitzende wurde – durch den in der ordentlichen Hauptversammlung am 13. Juni 2024 wiedergewählten Aufsichtsrat – im Rahmen einer vorsorglich anberaumten konstituierenden Sitzung des Aufsichtsrates in seiner Position bestätigt. Der auch nach der Wiederwahl des Aufsichtsrats amtierende Aufsichtsratsvorsitzende ist nach Überzeugung der Gesellschaft weiterhin unabhängig von der Gesellschaft und vom Vorstand. Da aber der Aufsichtsrat der Gesellschaft satzungsgemäß nur aus drei Personen besteht, werden keine Ausschüsse gebildet, mit Ausnahme des nach § 107 Abs. 4 AktG mittlerweile verpflichtenden Prüfungsausschusses. Dementsprechend existiert bei der Gesellschaft kein Vorsitzender des mit der Vorstandsvergütung befassten Ausschusses, sondern lediglich ein Vorsitzender des Prüfungsausschusses. Dieser ist nach Überzeugung der Gesellschaft auch unabhängig vom Vorstand und von der Gesellschaft, aufgrund seiner Organstellung bei der Mehrheitsaktionärin aber nicht unabhängig vom kontrollierenden Aktionär. Das primäre Ziel der Gesellschaft war es, der nun seit ein paar Jahren bestehenden neuen gesetzlichen Pflicht zur Einrichtung eines Prüfungsausschusses nachzukommen, ohne zugleich den Aufsichtsrat um weitere Mitglieder zu erweitern. Dies änderte sich auch im Zuge der Wiederwahl des Aufsichtsrats in der ordentlichen Hauptversammlung am 13. Juni 2024 nicht, da die Satzung diesbezüglich unverändert blieb und weiterhin lediglich drei Aufsichtsratsmitglieder vorsieht.

Mit Blick auf die außerordentliche Arbeitsbelastung des Aufsichtsratsvorsitzenden, die mit einer Kombination der Aufgaben Aufsichtsratsvorsitz und Vorsitz im Prüfungsausschuss verbunden wäre, war es aus Sicht der Gesellschaft wichtiger, dass der Aufsichtsratsvorsitzende nicht zugleich Vorsitzender des Prüfungsausschusses ist, weswegen die fehlende Unabhängigkeit des Vorsitzenden des Prüfungsausschusses gegenüber dem kontrollierenden Aktionär auch für die neue Amtsperiode bis zur Beendigung der Hauptversammlung, die über die Entlastung für das Geschäftsjahr 2026 beschließt, hingenommen wird, zumal schon die institutionelle Trennung von Prüfungsausschuss und Vorstand nach weiterhin bestehender Überzeugung der Gesellschaft ein hohes Maß an Unabhängigkeit sicherstellt. Der Aufsichtsrat wurde im Geschäftsjahr 2024 seit der letzten Entsprechenserklärung im Februar 2024 – weder vor noch nach der Wiederwahl des Aufsichtsrats – bis heute um keine neuen Mitglieder erweitert, da nach fortbestehender Überzeugung der Gesellschaft die institutionelle Trennung von Prüfungsausschuss und Vorstand bereits ein hohes Maß an Unabhängigkeit sicherstellt und die Gesellschaft eine Erweiterung des Aufsichtsrats deshalb weiterhin nicht für erforderlich hält. Die Amtszeit der in der ordentlichen Hauptversammlung am 13. Juni 2024 gewählten Aufsichtsratsmitglieder dauert bis zur Beendigung der Hauptversammlung, die über die Entlastung für das Geschäftsjahr 2026 beschließt, noch fort. Die Zusammensetzung des vorherigen Aufsichtsrats hatte sich bis zur ordentlichen Hauptversammlung am 13. Juni 2024 bewährt, weshalb eine Wiederwahl dieser Aufsichtsratsmitglieder erfolgte. Eine Änderung soll sich auch – unter Einhaltung der maximal zulässigen Amtsdauer von Aufsichtsratsmitgliedern– zukünftig weiter bewähren.

6. Ziffer D.1 des Kodex:

Der Kodex empfiehlt, dass sich der Aufsichtsrat eine Geschäftsordnung geben und diese auf der Internetseite der Gesellschaft zugänglich machen soll.

Der Aufsichtsrat hat sich zwar eine Geschäftsordnung gegeben, zugleich aber bewusst gegen eine Veröffentlichung der Geschäftsordnung auf der Internetseite der Gesellschaft entschieden. Der Aufsichtsrat ist der Ansicht, dass die Geschäftsordnung sehr detaillierte Regelungen für die Zusammenarbeit innerhalb des Aufsichtsrats und mit dem Vorstand enthält, dies aber lediglich die internen Abläufe innerhalb des Organs bzw. zwischen den Organen betrifft und eine Zugänglichmachung der Geschäftsordnung daher für die Anleger keinen Mehrwert bietet. Umgekehrt enthält die Geschäftsordnung jedoch auch vertrauliche Ausführungen mit Blick auf zustimmungspflichtige Maßnahmen, die bewusst nicht veröffentlicht werden sollen. An dieser Auffassung hält die Gesellschaft auch zukünftig weiter fest.

7. Ziffer D.2, D.3 Satz 1 bis Satz 3 und D.4 des Kodex:

Der Kodex empfiehlt, dass der Aufsichtsrat abhängig von den spezifischen Gegebenheiten des Unternehmens und der Anzahl seiner Mitglieder fachlich qualifizierte Ausschüsse bilden soll. Die jeweiligen Ausschussmitglieder und der Ausschussvorsitzende sollen namentlich in der Erklärung zur Unternehmensführung genannt werden. Der Sachverstand auf dem Gebiet Rechnungslegung soll in besonderen Kenntnissen und Erfahrungen in der Anwendung von Rechnungslegungsgrundsätzen und interner Kontroll- und Risikomanagementsysteme bestehen und der Sachverstand auf dem Gebiet Abschlussprüfung in besonderen Kenntnissen und Erfahrungen in der Abschlussprüfung. Zur Rechnungslegung und Abschlussprüfung gehören auch die Nachhaltigkeitsberichterstattung und deren Prüfung. Der Aufsichtsrat soll einen Nominierungsausschuss bilden, der ausschließlich mit Vertretern der Anteilseigner besetzt ist und dem Aufsichtsrat geeignete Kandidaten für dessen Vorschläge an die Hauptversammlung zur Wahl von Aufsichtsratsmitgliedern benennt. Der Prüfungsausschuss soll regelmäßig eine Beurteilung der Qualität der Abschlussprüfung vornehmen.

Da der Aufsichtsrat der Gesellschaft satzungsgemäß nur aus drei Personen besteht, werden – abgesehen von dem gesetzlich verpflichtend einzurichtenden Prüfungsausschuss (vgl. § 107 Abs. 4 AktG) – keine Ausschüsse gebildet. Dementsprechend finden die vorstehenden Empfehlungen insoweit keine Anwendung auf die Gesellschaft bzw. kann die Gesellschaft den vorstehenden Empfehlungen weiterhin nicht Folge leisten. Aufgrund der Tatsache, dass der Prüfungsausschuss zugleich das Plenum des Aufsichtsrats darstellt, befassen sich neben dem Plenum zugleich sämtliche Mitglieder des Prüfungsausschusses insbesondere mit der Rechnungslegung unter Anwendung der Rechnungslegungsgrundsätze, den internen Kontroll- und Risikomanagementsystemen und der Abschlussprüfung, einschließlich der Nachhaltigkeitsberichterstattung und deren Prüfung. Der auch nach der in der ordentlichen Hauptversammlung am 13. Juni 2024 durchgeführten Wiederwahl des Aufsichtsrats unverändert gebliebene Vorsitzende des Prüfungsausschusses (welcher im Rahmen einer konstituierenden Sitzung des vom Aufsichtsrat vorsorglich neu eingerichteten Prüfungsausschusses in seiner Position bestätigt wurde) verfügt zudem über besondere Kenntnisse und Erfahrungen in der Anwendung von Rechnungslegungsgrundsätzen und internen Kontrollverfahren und hat auch nicht zugleich das Amt des Aufsichtsratsvorsitzenden inne. Allerdings ist der Vorsitzende des Prüfungsausschusses noch nicht vertieft mit der Abschlussprüfung und der Nachhaltigkeitsberichterstattung vertraut und – wie in Ziffer C.10 ausgeführt – auch nicht unabhängig vom kontrollierenden Aktionär. Das primäre Ziel der Gesellschaft war zunächst, der neuen gesetzlichen Pflicht zur Einrichtung eines Prüfungsausschusses nachzukommen, ohne zugleich den Aufsichtsrat um weitere Mitglieder zu erweitern. Mit Blick auf die außerordentliche Arbeitsbelastung des Aufsichtsratsvorsitzenden, die mit einer Kombination der Aufgaben Aufsichtsratsvorsitz und Vorsitz im Prüfungsausschuss verbunden wäre, war es aus Sicht der Gesellschaft wichtiger, dass der Aufsichtsratsvorsitzende nicht zugleich Vorsitzender des Prüfungsausschusses ist, weswegen einerseits die fehlende Unabhängigkeit des Vorsitzenden des Prüfungsausschusses gegenüber dem kontrollierenden Aktionär und andererseits die fehlende Vertrautheit mit der Abschlussprüfung auch nach der Wiederwahl des Aufsichtsrats in der ordentlichen Hauptversammlung am 13. Juni 2024 mindestens für die laufende Amtsperiode des wiedergewählten Aufsichtsrats hingenommen werden. Dies erfolgt insbesondere vor dem Hintergrund, dass der Aufsichtsrat aufgrund seiner Größe dem Prüfungsausschuss entspricht und damit auch der Vorsitzende des Aufsichtsrats, welcher zugleich mit der Abschlussprüfung vertraut, Mitglied des Prüfungsausschusses ist, wodurch aus fortbestehender Sicht der Gesellschaft die entsprechende Kompetenz des Prüfungsausschusses sichergestellt wird. Die Zusammensetzung des Aufsichtsrates und damit Prüfungsausschusses hatte sich zudem – auch nach der Wiederwahl des Aufsichtsrats am 13. Juni 2024 – bewährt und soll sich auch weiterhin bewähren.

8. Ziffer D.11 des Kodex:

Der Kodex empfiehlt, dass die Gesellschaft die Mitglieder des Aufsichtsrats bei ihrer Amtseinführung sowie den Aus- und Fortbildungsmaßnahmen angemessen unterstützen und über durchgeführte Maßnahmen im Bericht des Aufsichtsrats berichten soll.

Die Gesellschaft hat, die in der ordentlichen Hauptversammlung am 13. Juni 2024 wiedergewählten Aufsichtsratsmitglieder, nicht nur bei deren erster Amtseinführung im Juli 2021, sondern auch nach deren Wiederwahl im Juni 2024 angemessen unterstützt und wird die Mitglieder des Aufsichtsrats auch in Zukunft weiterhin angemessen unterstützen.

Zwar wurden von den Aufsichtsratsmitgliedern bis heute keine Aus- oder Fortbildungsmaßnahmen durchgeführt, was insbesondere auf letzte Ausläufer der COVID-19-Pandemie sowie die geografische Entfernung zwischen Wohnsitz der einzelnen Aufsichtsratsmitglieder und Sitz der Gesellschaft zurückzuführen ist. Allerdings beabsichtigt die Gesellschaft auch für die Zukunft, die Mitglieder des Aufsichtsrats bei entsprechenden Aus- und Fortbildungsmaßnahmen wieder angemessen zu unterstützen; aktuell laufen auch wieder Gespräche mit verschiedenen Anbietern von Schulungen, die auf ihre Eignung überprüft werden, und eine Durchführung für das laufende Geschäftsjahr avisiert ist.

9. Ziffer G.3 des Kodex:

Der Kodex empfiehlt zur Beurteilung der Üblichkeit der konkreten Gesamtvergütung der Vorstandsmitglieder im Vergleich zu anderen Unternehmen, dass der Aufsichtsrat eine geeignete Vergleichsgruppe anderer Unternehmen (Peer-Group-Vergleich) heranzieht, deren Zusammenhang er offenlegt.

Die Vertragsunterlagen betr. die Vergütung der Vorstandsmitglieder sieht derzeit keinen Vergleich zur Vorstandsvergütung anderer Unternehmen vor. Die Vorstandsvergütung soll sich dennoch an dem in der Hauptversammlung vom 23. Juli 2021 beschlossenen Vorstandsvergütungssystem orientieren, welches unter Punkt 3. einen Vergleich mit anderen geeigneten Unternehmen vorsieht. Eine zusätzliche ausdrückliche Erwähnung in der vertraglichen Grundlage der Vorstandsvergütung wurde dementsprechend als nicht erforderlich angesehen. Nach § 120a Abs. 1 AktG beschließt die Hauptversammlung der Gesellschaft mindestens alle vier Jahre über die Billigung des vom Aufsichtsrat vorgelegten Vergütungssystems für die Vorstandsmitglieder, sodass in der ordentlichen Hauptversammlung des laufenden Geschäftsjahres ein solcher billigender Beschluss zu fassen ist. Der Aufsichtsrat beabsichtigt einen solchen Peer-Group-Vergleich in dem von ihm der Hautversammlung zur Billigung vorzulegenden Vergütungssystem bei der Üblichkeit der konkreten Gesamtvergütung nicht zu berücksichtigen, da die Gesamtvergütung aus Sicht der Gesellschaft insbesondere abhängig von den spezifischen Gegebenheiten des Unternehmens ist und ein Peer-Group-vergleich aufgrund der spezifischen aus Sicht der Gesellschaft keine verwertbaren Erkenntnisse bringen würde.

10. Ziffer G.4 des Kodex:

Der Kodex empfiehlt zur Beurteilung der Üblichkeit innerhalb des Unternehmens, dass der Aufsichtsrat das Verhältnis der Vorstandsvergütung zur Vergütung des oberen Führungskreises und der Belegschaft insgesamt und dieses auch in der zeitlichen Entwicklung berücksichtigt.

Diese Empfehlung wird derzeit nicht berücksichtigt, da sich die Gesellschaft auch im Geschäftsjahr 2024 in Folge der Übernahme durch die Mehrheitsaktionärin weiterhin in einem Umbruch befindet. Zudem hat die Gesellschaft im Geschäftsjahr 2024 nur noch einen Mitarbeiter unterhalb der Ebene des Führungskreises beschäftigt. Dieser ist als einzige Vergleichsperson nicht aussagekräftig genug. Der Vorstand besteht derzeit weiterhin nur aus einem alleinigen Vorstandsmitglied, sodass auch ein Vergleich mit der Vergütung anderer Vorstandsmitglieder ausscheidet. Gleichwohl ist beabsichtigt, die Vergütung des oberen Führungskreises und der Belegschaft insgesamt zukünftig zu berücksichtigen, sofern und soweit ein Vergleich sinnvoll erscheint.

11. Ziffer G.6 des Kodex:

Der Kodex empfiehlt, dass die variable Vergütung, die sich aus dem Erreichen langfristig orientierter Ziele ergibt, den Anteil aus kurzfristig orientierten Zielen übersteigen soll.

Diese Empfehlung wurde nicht umgesetzt, da der Beschluss des Aufsichtsrats über die Vorstandsvergütung durch den vorgenannten Übernahmeprozess beeinflusst wurde. Die Empfehlung ist auf absehbare Zeit jedoch umsetzbar; der Aufsichtsrat beabsichtigt, diese Empfehlung in dem von ihm der ordentlichen Hautversammlung im Geschäftsjahr 2025 zur Billigung vorzulegenden Vergütungssystem entsprechend zu berücksichtigen, sofern und soweit eine Berücksichtigung sinnvoll erscheint.

12. Ziffer G.10 des Kodex:

Der Kodex empfiehlt, dass die dem Vorstandsmitglied gewährten variablen Vergütungsbeträge von ihm unter Berücksichtigung der jeweiligen Steuerbelastung überwiegend in Aktien der Gesellschaft angelegt oder entsprechend aktienbasiert gewährt werden sollen.

Diese Empfehlung wurde nicht umgesetzt, da die vertragliche Grundlage dafür fehlte und in der derzeitigen Unternehmenslage nicht umsetzbar war und nach fortbestehender Überzeugung der Gesellschaft auf absehbare Zeit auch weiterhin nicht umsetzbar ist.

13. Ziffer G.11 des Kodex:

Der Kodex empfiehlt, dass der Aufsichtsrat die Möglichkeit haben soll, außergewöhnlichen Entwicklungen in angemessenem Rahmen Rechnung zu tragen. In begründeten Fällen soll eine variable Vergütung auch einbehalten oder zurückgefordert werden können.

Diese Empfehlung wurde nicht umgesetzt, da die Gesellschaft weiterhin davon ausgeht, dass das variable Vergütungsmodell bereits durch den automatischen Mechanismus, welches dem Vergütungssystem immanent ist, außergewöhnlichen Entwicklungen Rechnung trägt. Zum einen werden am Anfang jedes Jahres konkrete Kriterien für jedes Vorstandsmitglied neu definiert. Zum anderen entsteht eine auszahlungsfähige variable Vergütung nur dann, wenn mindestens 80% des Ziels, wie z.B. des EBITDA erreicht werden. Auch in dem der ordentlichen Hautversammlung im Geschäftsjahr 2025 zur Billigung vorzulegenden Vergütungssystem soll diese Empfehlung nicht umgesetzt werden. Der Aufsichtsrat und die Gesellschaft sind weiterhin der Ansicht, dass das variable Vergütungsmodell bereits durch den automatischen Mechanismus, welches dem Vergütungssystem immanent ist, außergewöhnlichen Entwicklungen Rechnung trägt.

14. Ziffer G.12 des Kodex:

Der Kodex empfiehlt, dass im Fall der Beendigung eines Vorstandsvertrags die Auszahlung noch offener variabler Vergütungsbestandteile, die auf die Zeit bis zur Vertragsbeendigung entfallen, nach den ursprünglich vereinbarten Zielen und Vergleichsparametern und nach den im Vertrag festgelegten Fälligkeitszeitpunkten oder Haltedauern erfolgen soll.

Diese Empfehlung wird aus Sicht der Gesellschaft mit anderen Mitteln erreicht: Die Vorstandsvergütung modifiziert die Empfehlung dergestalt, dass die Auszahlung der variablen Vergütungsbestandteile sogar entfällt, wenn die Fälligkeit der Auszahlung auf einen Zeitpunkt nach Beendigung des Vorstandsvertrags fällt. Die Gesellschaft ging davon aus, dass das Vorstandsmitglied zum Zeitpunkt der Fälligkeit der Auszahlung nur bei einem bestehenden Vorstandsvertrag an der Zielerreichung partizipieren können soll, da nur mit dieser Regelung eine Bindung des Vorstandsmitglieds an das Unternehmen erreicht wurde. Eine Änderung erfolgte nicht und ist auf absehbare Zeit deshalb auch weiterhin nicht vorgesehen; auch nicht in der ordentlichen Hauptversammlung im Geschäftsjahr 2025, die wieder über die Billigung des vom Aufsichtsrat vorzulegenden Vergütungssystem Beschluss zu fassen hat.

15. Ziffer G.15 des Kodex:

Der Kodex empfiehlt, dass sofern Vorstandsmitglieder konzerninterne Aufsichtsratsmandate wahrnehmen, die Vergütung angerechnet werden soll.

Diese Empfehlung wurde mittelbar umgesetzt, enthält jedoch nicht den vorgesehenen Automatismus: Die vertragliche Grundlage der Vorstandsvergütung sieht für Fälle konzerninterner Aufsichtsratsmandate ein vorheriges Zustimmungsbedürfnis der Gesellschaft vor. Zudem soll erst bei Einholung der Zustimmung vereinbart werden, wie mit dem weiteren konzerninternen Aufsichtsratsmandat umzugehen ist. Die Umsetzung der Empfehlung ist somit in den vertraglichen Grundlagen angelegt und damit umsetzbar. Der Aufsichtsrat stellt weiterhin und auch in dem der ordentlichen Hauptversammlung im Geschäftsjahr 2025 zur Billigung vorzulegenden Vergütungssystem sicher, dass in Fällen konzerninterner Aufsichtsratsmandate die Anrechnung der Vergütung zukünftig auch gewährleistet ist.

16. Ziffer G.16 des Kodex:

Der Kodex empfiehlt, dass bei der Übernahme konzernfremder Aufsichtsratsmandate der Aufsichtsrat entscheiden soll, ob und inwieweit die Vergütung anzurechnen ist.

Diese Empfehlung wurde gemäß den vorgenannten Erläuterungen zu Ziffer G.15 umgesetzt: Auch für Fälle konzernfremder Aufsichtsratsmandate sieht die vertragliche Grundlage der Vorstandsvergütung eine Vereinbarung zum Umgang mit solchen Mandaten im Einzelfall vor. Die Umsetzung der Empfehlung ist somit ebenfalls in den vertraglichen Grundlagen angelegt und damit umsetzbar. Der Aufsichtsrat stellt auch hier weiterhin sicher, dass in Fällen konzernfremder Aufsichtsratsmandate die Anrechnung der Vergütung auch zukünftig gewährleistet ist.

17. Ziffer G.17 des Kodex:

Der Kodex empfiehlt, dass bei der Vergütung der Aufsichtsratsmitglieder der höhere zeitliche Aufwand des Vorsitzenden und des stellvertretenden Vorsitzenden des Aufsichtsrats sowie des Vorsitzenden und der Mitglieder von Ausschüssen angemessen berücksichtigt werden soll.

Die Vergütung der Aufsichtsratsmitglieder berücksichtigt derzeit weiterhin zwar den Vorsitz im Aufsichtsrat, aber nicht den stellvertretenden Vorsitz im Aufsichtsrat sowie den Vorsitz oder die Mitgliedschaft in Ausschüssen. Die Gesellschaft ging bei der Festlegung des Vergütungssystems für die Aufsichtsratsmitglieder davon aus, dass mit Blick auf die beabsichtigte Aufgaben- bzw. Arbeitsteilung der Aufsichtsratsmitglieder zwar der Vorsitzende des Aufsichtsrats voraussichtlich einen deutlich höheren zeitlichen Aufwand haben würde, nicht jedoch der stellvertretende Vorsitzende im Vergleich zum dritten Aufsichtsratsmitglied. Daher wird bei der Vergütung der Aufsichtsratsmitglieder weiterhin lediglich der höhere zeitliche Aufwand des Vorsitzenden angemessen berücksichtigt. Der Vorsitz im Prüfungsausschuss wird nicht berücksichtigt, weil die Gesellschaft auch diesbezüglich nicht von einem wesentlichen Mehraufwand ausgeht. Da die Gesellschaft in Anbetracht der Größe des Aufsichtsrats von drei Mitgliedern – abgesehen vom Prüfungsausschuss – weiterhin keine Ausschüsse gebildet hat, ist die vorstehende Empfehlung im Hinblick auf Ausschussmitglieder nach Ansicht der Gesellschaft – auch nach der Wiederwahl des Aufsichtsrats in der ordentlichen Hauptversammlung am 13. Juni 2024 – nicht einschlägig.

Hagen, im Februar 2025

STS Group AG

Der Vorstand   Der Aufsichtsrat

Declaration by the Management Board and the Supervisory Board of STS GROUP AG on the recommendations of the "Government Commission on the German Corporate Governance Code" pursuant to Sec. 161 of the German Stock Corporation Act (Aktiengesetz, AktG)

Management Board and Supervisory Board of STS Group AG with its seat in Hagen, North Rhine-Westphalia, (the "Company") declare:

The Company complies with the recommendations of the "Government Commission on the German Corporate Governance Code" in the version of April 28, 2022, published in the German Federal Gazette (Bundesanzeiger) on June 27, 2022, (the "Code"), since February 2023, the date of the Company's last Declaration of Conformity, and will continue to comply, in each case with the following exceptions:

1. Section A.5 of the Code:

With the updated version of the Code dated April 28, 2022, since then the Code now also recommends that the key features of the overall internal control system and the risk management system should be described in the management report (Lagebericht) and that a statement should be made on the appropriateness and effectiveness of these systems.

At the time the management report for the financial year 2022 was prepared, the inclusion of the main features of the overall internal control system and the risk management system in the management report, as well as a statement on their appropriateness and effectiveness, was already a recommendation of the German Corporate Governance Code (the „GCGC“). This recommendation was already considered in the declaration of compliance in February 2023. The Company already addressed this recommendation of the GCGC at the beginning of the financial year 2022 and again at the beginning of the 2023 financial year – during the preparation of the management report for the respective financial year – and was also in an exchange with the Company's auditing firm commissioned to prepare the management report in this regard. However, the Company decided against including the aforementioned points in the management report for financial year 2021, as well as for financial year 2022, because the auditing firm was appointed and is responsible for the audit of the financial statements only. If the aforementioned points were included, however, the auditing firm would have to subject the Company's entire internal control system to an audit, for which the auditing firm was not actually appointed. In the management report for the financial year 2023, the Company therefore also intends not to have its internal control system audited by the auditing firm.

2. Section B.5 of the Code

The Code recommends that an age limit be specified for members of the Management Board and stated in the Corporate Governance Statement.

The Supervisory Board has repeatedly not passed a resolution specifying a concrete age limit for members of the Management Board, which is why no information can be provided in the Corporate Governance Statement in this regard. The Supervisory Board continues to be of the opinion that the decisive factor in the selection of candidates is that they are persons who possess the knowledge, skills and professional and personal experience required to properly perform their duties. The Company is convinced that these requirements are not linked to a specific age, which is why the Company continues to regard a specific age limit for members of the Management Board as unsuitable for ensuring that the persons concerned have the necessary skills.

3.Section C.1 of the Code:

The Code recommends that the Supervisory Board should specify concrete objectives for its composition and draw up a competence profile for the entire body. In doing so, the Supervisory Board should pay attention to diversity. The competence profile of the Supervisory Board should also include expertise on sustainability issues of importance to the Company. Proposals of the Supervisory Board to the Annual General Meeting shall take these objectives into account and at the same time aim to fill out the competence profile for the entire body. The status of implementation shall be disclosed in the form of a qualification matrix in the Corporate Governance Statement. This shall also provide information on the number of independent shareholder representatives on the Supervisory Board, considered appropriate by the shareholder representatives, and the names of these members.

The Supervisory Board has repeatedly not passed a resolution setting out specific objectives for the composition of the Supervisory Board or a competence profile for the entire body, which also includes expertise on sustainability issues of importance to the company. The Company is of the opinion that the current composition of the Supervisory Board meets the requirements of Section C.1 of the Code. When selecting candidates to be proposed for election to the Supervisory Board, the Company always ensures that these are persons who have the knowledge, skills and professional and personal experience required to properly perform their duties, also with regard to sustainability issues affecting the Company. For this reason, the Company continues to believe that targets set with regard to the specific composition are unsuitable for the election of an efficient and qualified Supervisory Board.

4. Section C.2 of the Code:

The Code recommends that an age limit be specified for Supervisory Board members and stated in the Corporate Governance Statement.

The Supervisory Board has also not passed any resolution specifying a concrete age limit, which is why no information can be provided in the corporate governance declaration. With reference to the above explanations on Section C.1, the Company is of the opinion that the decisive factor in the selection of candidates is that they are persons who have the knowledge, skills and professional and personal experience required to properly perform their duties, also with regard to sustainability issues affecting the Company. The Company is still convinced that these requirements are not linked to a specific age, which is why, in the future, the Company does not consider necessary a specific age limit for Supervisory Board members to be suitable for ensuring the necessary skills of the persons concerned either.

5. Section C.10 of the Code:

The Code recommends that the Chairman of the Supervisory Board, the Chairman of the Audit Committee and the Chairman of the committee dealing with Management Board compensation should be independent of the Company and the Management Board. The Chairman of the Audit Committee should also be independent of the controlling shareholder.

The Company is convinced that the Chairman of the Supervisory Board is independent of the Company and the Management Board. However, as the Supervisory Board of the Company consists of only three persons in accordance with the Articles of Association, no committees are formed, with the exception of the Audit Committee, which is now mandatory under Sec. 107 para. 4 of the German Stock Corporation Act (AktG). Accordingly, the Company does not have a Chairman of the committee dealing with Management Board compensation, but only a Chairman of the Audit Committee. The Company is convinced that the Chairman of the Audit Committee is also independent of the Management Board and the Company, but due to his position on the board of the majority shareholder he is not independent of the controlling shareholder. The primary objective of the Company was initially to comply with the new statutory obligation to establish an Audit Committee without at the same time adding further members to the Supervisory Board. In view of the extraordinary workload for the Chairman of the Supervisory Board that would be associated with a combination of the duties of Chairman of the Supervisory Board and Chairman of the Audit Committee, it was more important from the Company's point of view that the Chairman of the Supervisory Board should not also be Chairman of the Audit Committee, which is why the lack of independence of the Chairman of the Audit Committee vis-à-vis the controlling shareholder will be accepted for the foreseeable future, especially as the Company is convinced that the institutional separation of the Audit Committee and the Management Board already ensures a high degree of independence. Since the last declaration of conformity in February 2023, no new members have been added to the Supervisory Board in the financial year 2023, as the Company remains convinced that the institutional separation of the Audit Committee and the Management Board already ensures a high degree of independence and that the Company therefore still does not consider it necessary to expand the Supervisory Board. The term of office of the Supervisory Board members elected at the Annual General Meeting on 23 July 2021 continues. The composition of the current Supervisory Board has proven itself to date and should continue to do so in the future.

6. Section D.1 of the Code:

The Code recommends that the Supervisory Board should adopt rules of procedure and make them available on the Company's website.

Although the Supervisory Board has adopted rules of procedure, it has deliberately decided not to publish them on the Company's website. The Supervisory Board is of the opinion that the Rules of Procedure contain very detailed regulations for cooperation within the Supervisory Board and with the Board of Management, but that these only relate to internal processes within the body or between the bodies and that making the Rules of Procedure accessible therefore offers no added value for investors. Conversely, however, the Rules of Procedure also contain confidential statements with regard to measures requiring approval, which are deliberately not intended to be published. The company continues to adhere to this view.

7. Section D.2, D.3 sentence 1 to sentence 3 and D.4 of the Code:

The Code recommends that the Supervisory Board should form professionally qualified committees depending on the specific circumstances of the Company and the number of its members. The respective committee members and the committee chairman should be named in the Corporate Governance Statement. The expertise in the field of accounting should consist of special knowledge and experience in the application of accounting principles and internal control and risk management systems, and the expertise in the field of auditing should consist of special knowledge and experience in auditing. Accounting and auditing also include sustainability reporting and its audit. The Supervisory Board shall form a Nomination Committee composed exclusively of shareholder representatives which nominates suitable candidates to the Supervisory Board for its proposals to the Annual General Meeting for the election of Supervisory Board members. The Audit Committee shall regularly assess the quality of the audit of the financial statements.

As the Supervisory Board of the Company consists of only three persons in accordance with the Articles of Association, no committees are formed - apart from the Audit Committee, which is mandatory by law (cf. Sec. 107 para. 4 of the German Stock Corporation Act (AktG). Accordingly, the above recommendations do not apply to the Company and the Company still cannot comply with the above recommendations. As the Audit Committee is also the plenary body of the Supervisory Board, all members of the Audit Committee, in addition to the plenary body, deal in particular with accounting in accordance with the accounting principles, the internal control and risk management systems and the audit of the financial statements, including sustainability reporting and its audit. The Chairman of the Audit Committee also has special knowledge and experience in the application of accounting principles and internal control procedures and does not simultaneously hold the office of Chairman of the Supervisory Board. However, the Chairman of the Audit Committee is not yet familiar in depth with the audit of the financial statements and sustainability reporting and - as stated in section C.10 - is not independent of the controlling shareholder. The primary objective of the Company was initially to comply with the new statutory obligation to establish an Audit Committee without at the same time adding further members to the Supervisory Board. In view of the extraordinary workload of the Chairman of the Supervisory Board, which would be associated with a combination of the duties of Chairman of the Supervisory Board and Chairman of the Audit Committee, from the point of view of the Company it was more important that the Chairman of the Supervisory Board should not at the same time be Chairman of the Audit Committee, which is why on the one hand the lack of independence of the Chairman of the Audit Committee vis-à-vis the controlling shareholder and on the other hand the lack of familiarity with the auditing of the financial statements are accepted for the foreseeable future. This is particularly the case against the background that the Supervisory Board, due to its size, corresponds to the Audit Committee and thus the Chairman of the Supervisory Board, who is also familiar with the audit of the financial statements, and is also a member of the Audit Committee, which, from the continuing point of view of the Company, ensures the corresponding competence of the Audit Committee. The composition of the Supervisory Board and thus the Audit Committee has also proven itself and should continue to do so.

8. Section D.11 of the Code:

The Code recommends that the Company should provide appropriate support for the members of the Supervisory Board during their induction into office and during training and development measures, and report on the measures taken in the report of the Supervisory Board.

The Company did provide appropriate support to the Supervisory Board members newly appointed by the Annual General Meeting in July 2021 during their induction and will continue to support the members of the Supervisory Board appropriately in the future. However, no training or further education measures have been carried out by the Supervisory Board members to date, due in particular to recent outbreaks of the COVID 19 pandemic. The Company also intends to provide appropriate support to the members of the Supervisory Board in terms of training and continuing education measures in the future; talks are currently underway with various providers of such training courses, which are planned for the current financial year.

9. Section F.2 of the Code:

The Code recommends that the consolidated financial statements and the Group management report should be publicly accessible within 90 days of the end of the financial year, and the mandatory interim financial information within 45 days of the end of the reporting period.

In view of the legal requirement to publish the consolidated financial statements within the first four months of the Group's financial year, the Company complies with the legal requirements. The consolidated financial statements were published on April 20, 2023, just a few days after the deadline recommended by the Code. Due to the time required for the careful preparation of interim reports, the Company has also followed the statutory publication deadlines for the respective interim reports. However, the Company continues to endeavour to reduce the time required for the publication of consolidated financial statements and interim financial information to an absolute minimum in future.

10. Section G.3 of the Code:

The Code recommends that, in order to assess the customary nature of the specific total compensation of the members of the Management Board in comparison with other companies, the Supervisory Board uses a suitable comparison group of other companies (peer group comparison), the context of which it discloses.

The contractual documents relating to the compensation of the Management Board members do not currently provide for a comparison with the Management Board compensation of other companies. Nevertheless, Management Board compensation is to be based on the Management Board compensation system resolved at the Annual General Meeting on July 23, 2021, which provides for a comparison with other suitable companies under item 3. Accordingly, an additional explicit mention in the contractual basis of the Management Board compensation was not considered necessary. In the next revision of the contractual documents, however, a peer group comparison is to be made and taken into account in the customary nature of the specific total compensation.

11. Section G.4 of the Code:

For the purpose of assessing customary practice within the Company, the Code recommends that the Supervisory Board take into account the ratio of Management Board compensation to the compensation of senior management and the workforce as a whole, and this also in terms of its development over time.

This recommendation is not taken into account at present, as the Company continues to be in a state of upheaval in financial year 2023 as a result of the takeover by the new majority shareholder. In addition, the Company has only one employee below management level in financial year 2023. As the only comparator, this is not sufficiently meaningful. The Management Board currently still consists of only one sole Management Board member, so that a comparison with the compensation of other Management Board members is also ruled out. Nevertheless, it is intended to take into account the compensation of senior executives and the workforce as a whole in the future, if and to the extent that a comparison appears meaningful.

12. No G.6 of the Code:

The Code recommends that the variable compensation resulting from the achievement of long-term oriented targets should exceed the share resulting from short-term oriented targets.

This recommendation was not implemented as the Management Board compensation was affected by the aforementioned takeover process. However, the recommendation can be implemented in the foreseeable future; the Supervisory Board intends to adjust the contractual basis accordingly in the near future.

13. Section G.10 of the Code:

The Code recommends that the variable compensation amounts granted to the Management Board member should be invested by him predominantly in shares of the Company, taking into account the respective tax burden, or granted on a share-based basis accordingly.

This recommendation was not implemented as the contractual basis for this was lacking and could not be implemented in the current situation of the Company and, in the continuing conviction of the Company, will not be implemented in the foreseeable future.

14. Section G.11 of the Code:

The Code recommends that the Supervisory Board should have the possibility to take account of extraordinary developments to an appropriate extent. In justified cases, it should also be possible to withhold or demand the return of variable compensation.

This recommendation has not been implemented, as the Company continues to believe that the variable compensation model already takes account of extraordinary developments through the automatic mechanism inherent in the compensation system. On the one hand, concrete criteria are redefined for each Management Board member at the beginning of each year. Secondly, variable remuneration that can be paid out only arises if at least 80% of the target, such as EBITDA, is achieved.

15. Section G.12 of the Code:

The Code recommends that, in the event of termination of a Management Board contract, the payment of outstanding variable compensation components attributable to the period up to the termination of the contract should be made in accordance with the originally agreed targets and comparison parameters and in accordance with the due dates or holding periods specified in the contract.

From the Company's point of view, this recommendation is achieved by other means: The Management Board compensation modifies the recommendation in such a way that the payment of the variable compensation components is even waived if the due date of the payment falls on a date after the termination of the Management Board contract. The Company assumed that the Management Board member should only be able to participate in the achievement of targets at the time the payment is due if he or she has an existing Management Board contract, as this was the only way of binding the Management Board member to the Company. No change has been made and is therefore not planned for the foreseeable future.

16. Section G.15 of the Code:

The Code recommends that where members of the Board of Management hold supervisory board mandates within the Group, the compensation should be credited.

This recommendation has been implemented indirectly, but does not contain the intended automatism: The contractual basis for the compensation of the Board of Management requires the prior consent of the Company in the case of intra-Group supervisory board mandates. In addition, it should only be agreed how to deal with the further intra-Group Supervisory Board mandate once approval has been obtained. The implementation of the recommendation is therefore laid down in the basic contractual conditions and can therefore be implemented. The Supervisory Board will continue to ensure that in cases of intra-Group Supervisory Board mandates the recognition of compensation is also guaranteed in the future.

17. Section G.16 of the Code:

The Code recommends that, in the event of the assumption of supervisory board mandates from outside the Group, the Supervisory Board should decide whether and to what extent the compensation is to be imputed.

This recommendation has been implemented in accordance with the aforementioned explanations to Section G.15: The contractual basis for Management Board compensation also provides for an agreement on the handling of such mandates in individual cases. The implementation of the recommendation is therefore also laid down in the contractual basis and can therefore be implemented. The Supervisory Board will also continue to ensure that in cases of Supervisory Board mandates outside the Group, the compensation is taken into account in the future as well.

18. Section G.17 of the Code:

The Code recommends that the compensation of Supervisory Board members should take appropriate account of the greater time commitment of the Chairman and Deputy Chairman of the Supervisory Board and of the Chairman and members of committees.

The compensation of Supervisory Board members currently takes into account the chairmanship of the Supervisory Board, but not the deputy chairmanship of the Supervisory Board or the chairmanship or membership of committees. In determining the compensation system for the members of the Supervisory Board, the Company assumed that, in view of the intended division of duties and work among the members of the Supervisory Board, the Chairman of the Supervisory Board would probably have a significantly higher time commitment, but not the Deputy Chairman compared with the third member of the Supervisory Board. Therefore, the compensation of the Supervisory Board members only takes into account the higher time expenditure of the Chairman. The chairmanship of the Audit Committee is not taken into account because the Company does not expect any significant additional expense in this respect either. As the Company has not formed any committees – apart from the Audit Committee – in view of the size of the Supervisory Board of three members, the above recommendation is not relevant with regard to committee members.

Hagen, February 2024
STS Group AG
Management Board
Supervisory Board

Declaration by the Management Board and the Supervisory Board of STS GROUP AG on the recommendations of the "Government Commission on the German Corporate Governance Code" pursuant to Sec. 161 of the German Stock Corporation Act (Aktiengesetz, AktG)

Management Board and Supervisory Board of STS Group AG with its seat in Hagen, North Rhine-Westphalia, (the "Company") declare:

The Company complies with the recommendations of the "Government Commission on the German Corporate Governance Code" in the version of April 28, 2022, published in the German Federal Gazette (Bundesanzeiger) on June 27, 2022, (the "Code"), since February 2023, the date of the Company's last Declaration of Conformity, and will continue to comply, in each case with the following exceptions:

1. Section A.5 of the Code:

With the updated version of the Code dated April 28, 2022, since then the Code now also recommends that the key features of the overall internal control system and the risk management system should be described in the management report (Lagebericht) and that a statement should be made on the appropriateness and effectiveness of these systems.

At the time the management report for the financial year 2022 was prepared, the inclusion of the main features of the overall internal control system and the risk management system in the management report, as well as a statement on their appropriateness and effectiveness, was already a recommendation of the German Corporate Governance Code (the „GCGC“). This recommendation was already considered in the declaration of compliance in February 2023. The Company already addressed this recommendation of the GCGC at the beginning of the financial year 2022 and again at the beginning of the 2023 financial year – during the preparation of the management report for the respective financial year – and was also in an exchange with the Company's auditing firm commissioned to prepare the management report in this regard. However, the Company decided against including the aforementioned points in the management report for financial year 2021, as well as for financial year 2022, because the auditing firm was appointed and is responsible for the audit of the financial statements only. If the aforementioned points were included, however, the auditing firm would have to subject the Company's entire internal control system to an audit, for which the auditing firm was not actually appointed. In the management report for the financial year 2023, the Company therefore also intends not to have its internal control system audited by the auditing firm.

2. Section B.5 of the Code

The Code recommends that an age limit be specified for members of the Management Board and stated in the Corporate Governance Statement.

The Supervisory Board has repeatedly not passed a resolution specifying a concrete age limit for members of the Management Board, which is why no information can be provided in the Corporate Governance Statement in this regard. The Supervisory Board continues to be of the opinion that the decisive factor in the selection of candidates is that they are persons who possess the knowledge, skills and professional and personal experience required to properly perform their duties. The Company is convinced that these requirements are not linked to a specific age, which is why the Company continues to regard a specific age limit for members of the Management Board as unsuitable for ensuring that the persons concerned have the necessary skills.

3.Section C.1 of the Code:

The Code recommends that the Supervisory Board should specify concrete objectives for its composition and draw up a competence profile for the entire body. In doing so, the Supervisory Board should pay attention to diversity. The competence profile of the Supervisory Board should also include expertise on sustainability issues of importance to the Company. Proposals of the Supervisory Board to the Annual General Meeting shall take these objectives into account and at the same time aim to fill out the competence profile for the entire body. The status of implementation shall be disclosed in the form of a qualification matrix in the Corporate Governance Statement. This shall also provide information on the number of independent shareholder representatives on the Supervisory Board, considered appropriate by the shareholder representatives, and the names of these members.

The Supervisory Board has repeatedly not passed a resolution setting out specific objectives for the composition of the Supervisory Board or a competence profile for the entire body, which also includes expertise on sustainability issues of importance to the company. The Company is of the opinion that the current composition of the Supervisory Board meets the requirements of Section C.1 of the Code. When selecting candidates to be proposed for election to the Supervisory Board, the Company always ensures that these are persons who have the knowledge, skills and professional and personal experience required to properly perform their duties, also with regard to sustainability issues affecting the Company. For this reason, the Company continues to believe that targets set with regard to the specific composition are unsuitable for the election of an efficient and qualified Supervisory Board.

4. Section C.2 of the Code:

The Code recommends that an age limit be specified for Supervisory Board members and stated in the Corporate Governance Statement.

The Supervisory Board has also not passed any resolution specifying a concrete age limit, which is why no information can be provided in the corporate governance declaration. With reference to the above explanations on Section C.1, the Company is of the opinion that the decisive factor in the selection of candidates is that they are persons who have the knowledge, skills and professional and personal experience required to properly perform their duties, also with regard to sustainability issues affecting the Company. The Company is still convinced that these requirements are not linked to a specific age, which is why, in the future, the Company does not consider necessary a specific age limit for Supervisory Board members to be suitable for ensuring the necessary skills of the persons concerned either.

5. Section C.10 of the Code:

The Code recommends that the Chairman of the Supervisory Board, the Chairman of the Audit Committee and the Chairman of the committee dealing with Management Board compensation should be independent of the Company and the Management Board. The Chairman of the Audit Committee should also be independent of the controlling shareholder.

The Company is convinced that the Chairman of the Supervisory Board is independent of the Company and the Management Board. However, as the Supervisory Board of the Company consists of only three persons in accordance with the Articles of Association, no committees are formed, with the exception of the Audit Committee, which is now mandatory under Sec. 107 para. 4 of the German Stock Corporation Act (AktG). Accordingly, the Company does not have a Chairman of the committee dealing with Management Board compensation, but only a Chairman of the Audit Committee. The Company is convinced that the Chairman of the Audit Committee is also independent of the Management Board and the Company, but due to his position on the board of the majority shareholder he is not independent of the controlling shareholder. The primary objective of the Company was initially to comply with the new statutory obligation to establish an Audit Committee without at the same time adding further members to the Supervisory Board. In view of the extraordinary workload for the Chairman of the Supervisory Board that would be associated with a combination of the duties of Chairman of the Supervisory Board and Chairman of the Audit Committee, it was more important from the Company's point of view that the Chairman of the Supervisory Board should not also be Chairman of the Audit Committee, which is why the lack of independence of the Chairman of the Audit Committee vis-à-vis the controlling shareholder will be accepted for the foreseeable future, especially as the Company is convinced that the institutional separation of the Audit Committee and the Management Board already ensures a high degree of independence. Since the last declaration of conformity in February 2023, no new members have been added to the Supervisory Board in the financial year 2023, as the Company remains convinced that the institutional separation of the Audit Committee and the Management Board already ensures a high degree of independence and that the Company therefore still does not consider it necessary to expand the Supervisory Board. The term of office of the Supervisory Board members elected at the Annual General Meeting on 23 July 2021 continues. The composition of the current Supervisory Board has proven itself to date and should continue to do so in the future.

6. Section D.1 of the Code:

The Code recommends that the Supervisory Board should adopt rules of procedure and make them available on the Company's website.

Although the Supervisory Board has adopted rules of procedure, it has deliberately decided not to publish them on the Company's website. The Supervisory Board is of the opinion that the Rules of Procedure contain very detailed regulations for cooperation within the Supervisory Board and with the Board of Management, but that these only relate to internal processes within the body or between the bodies and that making the Rules of Procedure accessible therefore offers no added value for investors. Conversely, however, the Rules of Procedure also contain confidential statements with regard to measures requiring approval, which are deliberately not intended to be published. The company continues to adhere to this view.

7. Section D.2, D.3 sentence 1 to sentence 3 and D.4 of the Code:

The Code recommends that the Supervisory Board should form professionally qualified committees depending on the specific circumstances of the Company and the number of its members. The respective committee members and the committee chairman should be named in the Corporate Governance Statement. The expertise in the field of accounting should consist of special knowledge and experience in the application of accounting principles and internal control and risk management systems, and the expertise in the field of auditing should consist of special knowledge and experience in auditing. Accounting and auditing also include sustainability reporting and its audit. The Supervisory Board shall form a Nomination Committee composed exclusively of shareholder representatives which nominates suitable candidates to the Supervisory Board for its proposals to the Annual General Meeting for the election of Supervisory Board members. The Audit Committee shall regularly assess the quality of the audit of the financial statements.

As the Supervisory Board of the Company consists of only three persons in accordance with the Articles of Association, no committees are formed - apart from the Audit Committee, which is mandatory by law (cf. Sec. 107 para. 4 of the German Stock Corporation Act (AktG). Accordingly, the above recommendations do not apply to the Company and the Company still cannot comply with the above recommendations. As the Audit Committee is also the plenary body of the Supervisory Board, all members of the Audit Committee, in addition to the plenary body, deal in particular with accounting in accordance with the accounting principles, the internal control and risk management systems and the audit of the financial statements, including sustainability reporting and its audit. The Chairman of the Audit Committee also has special knowledge and experience in the application of accounting principles and internal control procedures and does not simultaneously hold the office of Chairman of the Supervisory Board. However, the Chairman of the Audit Committee is not yet familiar in depth with the audit of the financial statements and sustainability reporting and - as stated in section C.10 - is not independent of the controlling shareholder. The primary objective of the Company was initially to comply with the new statutory obligation to establish an Audit Committee without at the same time adding further members to the Supervisory Board. In view of the extraordinary workload of the Chairman of the Supervisory Board, which would be associated with a combination of the duties of Chairman of the Supervisory Board and Chairman of the Audit Committee, from the point of view of the Company it was more important that the Chairman of the Supervisory Board should not at the same time be Chairman of the Audit Committee, which is why on the one hand the lack of independence of the Chairman of the Audit Committee vis-à-vis the controlling shareholder and on the other hand the lack of familiarity with the auditing of the financial statements are accepted for the foreseeable future. This is particularly the case against the background that the Supervisory Board, due to its size, corresponds to the Audit Committee and thus the Chairman of the Supervisory Board, who is also familiar with the audit of the financial statements, and is also a member of the Audit Committee, which, from the continuing point of view of the Company, ensures the corresponding competence of the Audit Committee. The composition of the Supervisory Board and thus the Audit Committee has also proven itself and should continue to do so.

8. Section D.11 of the Code:

The Code recommends that the Company should provide appropriate support for the members of the Supervisory Board during their induction into office and during training and development measures, and report on the measures taken in the report of the Supervisory Board.

The Company did provide appropriate support to the Supervisory Board members newly appointed by the Annual General Meeting in July 2021 during their induction and will continue to support the members of the Supervisory Board appropriately in the future. However, no training or further education measures have been carried out by the Supervisory Board members to date, due in particular to recent outbreaks of the COVID 19 pandemic. The Company also intends to provide appropriate support to the members of the Supervisory Board in terms of training and continuing education measures in the future; talks are currently underway with various providers of such training courses, which are planned for the current financial year.

9. Section F.2 of the Code:

The Code recommends that the consolidated financial statements and the Group management report should be publicly accessible within 90 days of the end of the financial year, and the mandatory interim financial information within 45 days of the end of the reporting period.

In view of the legal requirement to publish the consolidated financial statements within the first four months of the Group's financial year, the Company complies with the legal requirements. The consolidated financial statements were published on April 20, 2023, just a few days after the deadline recommended by the Code. Due to the time required for the careful preparation of interim reports, the Company has also followed the statutory publication deadlines for the respective interim reports. However, the Company continues to endeavour to reduce the time required for the publication of consolidated financial statements and interim financial information to an absolute minimum in future.

10. Section G.3 of the Code:

The Code recommends that, in order to assess the customary nature of the specific total compensation of the members of the Management Board in comparison with other companies, the Supervisory Board uses a suitable comparison group of other companies (peer group comparison), the context of which it discloses.

The contractual documents relating to the compensation of the Management Board members do not currently provide for a comparison with the Management Board compensation of other companies. Nevertheless, Management Board compensation is to be based on the Management Board compensation system resolved at the Annual General Meeting on July 23, 2021, which provides for a comparison with other suitable companies under item 3. Accordingly, an additional explicit mention in the contractual basis of the Management Board compensation was not considered necessary. In the next revision of the contractual documents, however, a peer group comparison is to be made and taken into account in the customary nature of the specific total compensation.

11. Section G.4 of the Code:

For the purpose of assessing customary practice within the Company, the Code recommends that the Supervisory Board take into account the ratio of Management Board compensation to the compensation of senior management and the workforce as a whole, and this also in terms of its development over time.

This recommendation is not taken into account at present, as the Company continues to be in a state of upheaval in financial year 2023 as a result of the takeover by the new majority shareholder. In addition, the Company has only one employee below management level in financial year 2023. As the only comparator, this is not sufficiently meaningful. The Management Board currently still consists of only one sole Management Board member, so that a comparison with the compensation of other Management Board members is also ruled out. Nevertheless, it is intended to take into account the compensation of senior executives and the workforce as a whole in the future, if and to the extent that a comparison appears meaningful.

12. No G.6 of the Code:

The Code recommends that the variable compensation resulting from the achievement of long-term oriented targets should exceed the share resulting from short-term oriented targets.

This recommendation was not implemented as the Management Board compensation was affected by the aforementioned takeover process. However, the recommendation can be implemented in the foreseeable future; the Supervisory Board intends to adjust the contractual basis accordingly in the near future.

13. Section G.10 of the Code:

The Code recommends that the variable compensation amounts granted to the Management Board member should be invested by him predominantly in shares of the Company, taking into account the respective tax burden, or granted on a share-based basis accordingly.

This recommendation was not implemented as the contractual basis for this was lacking and could not be implemented in the current situation of the Company and, in the continuing conviction of the Company, will not be implemented in the foreseeable future.

14. Section G.11 of the Code:

The Code recommends that the Supervisory Board should have the possibility to take account of extraordinary developments to an appropriate extent. In justified cases, it should also be possible to withhold or demand the return of variable compensation.

This recommendation has not been implemented, as the Company continues to believe that the variable compensation model already takes account of extraordinary developments through the automatic mechanism inherent in the compensation system. On the one hand, concrete criteria are redefined for each Management Board member at the beginning of each year. Secondly, variable remuneration that can be paid out only arises if at least 80% of the target, such as EBITDA, is achieved.

15. Section G.12 of the Code:

The Code recommends that, in the event of termination of a Management Board contract, the payment of outstanding variable compensation components attributable to the period up to the termination of the contract should be made in accordance with the originally agreed targets and comparison parameters and in accordance with the due dates or holding periods specified in the contract.

From the Company's point of view, this recommendation is achieved by other means: The Management Board compensation modifies the recommendation in such a way that the payment of the variable compensation components is even waived if the due date of the payment falls on a date after the termination of the Management Board contract. The Company assumed that the Management Board member should only be able to participate in the achievement of targets at the time the payment is due if he or she has an existing Management Board contract, as this was the only way of binding the Management Board member to the Company. No change has been made and is therefore not planned for the foreseeable future.

16. Section G.15 of the Code:

The Code recommends that where members of the Board of Management hold supervisory board mandates within the Group, the compensation should be credited.

This recommendation has been implemented indirectly, but does not contain the intended automatism: The contractual basis for the compensation of the Board of Management requires the prior consent of the Company in the case of intra-Group supervisory board mandates. In addition, it should only be agreed how to deal with the further intra-Group Supervisory Board mandate once approval has been obtained. The implementation of the recommendation is therefore laid down in the basic contractual conditions and can therefore be implemented. The Supervisory Board will continue to ensure that in cases of intra-Group Supervisory Board mandates the recognition of compensation is also guaranteed in the future.

17. Section G.16 of the Code:

The Code recommends that, in the event of the assumption of supervisory board mandates from outside the Group, the Supervisory Board should decide whether and to what extent the compensation is to be imputed.

This recommendation has been implemented in accordance with the aforementioned explanations to Section G.15: The contractual basis for Management Board compensation also provides for an agreement on the handling of such mandates in individual cases. The implementation of the recommendation is therefore also laid down in the contractual basis and can therefore be implemented. The Supervisory Board will also continue to ensure that in cases of Supervisory Board mandates outside the Group, the compensation is taken into account in the future as well.

18. Section G.17 of the Code:

The Code recommends that the compensation of Supervisory Board members should take appropriate account of the greater time commitment of the Chairman and Deputy Chairman of the Supervisory Board and of the Chairman and members of committees.

The compensation of Supervisory Board members currently takes into account the chairmanship of the Supervisory Board, but not the deputy chairmanship of the Supervisory Board or the chairmanship or membership of committees. In determining the compensation system for the members of the Supervisory Board, the Company assumed that, in view of the intended division of duties and work among the members of the Supervisory Board, the Chairman of the Supervisory Board would probably have a significantly higher time commitment, but not the Deputy Chairman compared with the third member of the Supervisory Board. Therefore, the compensation of the Supervisory Board members only takes into account the higher time expenditure of the Chairman. The chairmanship of the Audit Committee is not taken into account because the Company does not expect any significant additional expense in this respect either. As the Company has not formed any committees – apart from the Audit Committee – in view of the size of the Supervisory Board of three members, the above recommendation is not relevant with regard to committee members.

Hagen, February 2024
STS Group AG
Management Board
Supervisory Board

Declaration of the Management Board and the Supervisory Board of STS GROUP AG on the recommendations of the Government Commission of the German Corporate Governance Code pursuant to Sec. 161 of the German Stock Corporation Act (Aktiengesetz)

The Management Board and Supervisory Board of the STS Group AG with its registered office in Hallbergmoos, District of Freising, (the “Company”) declare the following:

The Company has complied with the recommendations of the Government Commission on the German Corporate Governance Code in its latest version dated 16 December 2019, published in the Federal Gazette (Bundesanzeiger) on 20 March 2020 (the “Code”), since the last Declaration of Conformity in February 2021 and will continue to comply with them in the future, in each case with the following exceptions:

1. Recommendation B.5 of the Code:

The Code recommends that an age limit be specified for members of the Management Board and stated in the Corporate Governance Declaration.

The Supervisory Board has not passed any resolution specifying a concrete age limit for members of the Management Board, which is why no information can be provided in the Corporate Governance Declaration. The Supervisory Board is of the opinion that the decisive factor in the selection of candidates is that they are persons who have the knowledge, skills and professional and personal experience required to properly perform their duties. The Company is convinced that these requirements are not linked to a specific age, which is why the Company does not consider a specific age limit for members of the Management Board to be suitable for ensuring that the persons concerned have the necessary skills.

2. Recommendation C.1 of the Code:

The Code recommends that the Supervisory Board should specify concrete objectives for its composition and draw up a competence profile for the entire body. In doing so, the Supervisory Board should pay attention to diversity. Proposals by the Supervisory Board to the Annual General Meeting should take these objectives into account and at the same time aim to fill out the competence profile for the entire body. The status of implementation shall be published in the Corporate Governance Declaration. This shall also provide information on the number of independent shareholder representatives on the Supervisory Board, as deemed appropriate by the shareholder representatives, and the names of these members.

The Supervisory Board has not passed any resolution specifying concrete objectives regarding the composition of the Supervisory Board or a competence profile for the entire body. The Company is of the opinion that the current composition of the Supervisory Board complies with the requirements of the recommendation C.1 of the Code. When selecting candidates to be proposed for election to the Supervisory Board, the Company always ensures that these are persons who possess the knowledge, skills and professional and personal experience required to properly perform their duties. For this reason, the Company concludes that set objectives in terms of specific composition are unsuitable for the election of an efficient and qualified Supervisory Board.

3. Recommendation C.2 of the Code:

The Code recommends that an age limit be specified for members of the Supervisory Board and stated in the Corporate Governance Declaration.

The Supervisory Board has not passed any resolution specifying a concrete age limit, which is why no information can be provided in the corporate governance declaration. With reference to the above comments on the recommendation C.1, the Company is of the opinion that the decisive factor in the selection of candidates is that they are persons who possess the knowledge, skills and professional and personal experience required to properly perform their duties. The Company is convinced that these requirements are not linked to a specific age, which is why the Company does not consider a specific age limit for Supervisory Board members to be suitable for ensuring that the persons concerned have the necessary skills.

4. Recommendation C.10 of the Code:

The Code recommends that the Chairman of the Supervisory Board, the Chairman of the Audit Committee and the Chairman of the Committee dealing with the compensation of the Management Board should be independent of the Company and the Management Board. The Chairman of the Audit Committee should also be independent of the controlling shareholder.

It is the conviction of the Company that the Chairman of the Supervisory Board is independent of the Company and the Management Board. However, as the Supervisory Board of the Company consists of only three persons in accordance with the Articles of Association, no committees are formed, with the exception of the Audit Committee, which is now mandatory under Sec. 107 para 4 of the German Stock Corporation Act (AktG). Accordingly, the Company does not have a Chairman of the Committee dealing with the compensation of the Management Board, but only a Chairman of the Audit Committee. The latter is in the conviction of the Company also independent of the Company and the Management Board but not independent of the controlling shareholder due to his position on the board of the majority shareholder. The primary objective of the Company was initially to comply with the new statutory obligation to establish an Audit Committee without at the same time adding further members to the Supervisory Board. In view of the extraordinary workload of the Chairman of the Supervisory Board, which would be associated with a combination of the duties of Chairman of the Supervisory Board and Chairman of the Audit Committee, it was more important from the point of view of the Company that the Chairman of the Supervisory Board should not at the same time be Chairman of the Audit Committee, which is why the lack of independence of the Chairman of the Audit Committee vis-à-vis the controlling shareholder will be accepted for the foreseeable future, especially as the Company is convinced that the institutional separation of the Audit Committee and the Management Board already ensures a high degree of independence.

5. Recommendation D.1 of the Code:

The Code recommends that the Supervisory Board should adopt Rules of Procedure and make them available on the Company's website.

Although the Supervisory Board has adopted Rules of Procedure, it has deliberately decided not to publish them on the Company's website. The Supervisory Board is of the opinion that the Rules of Procedure contain very detailed regulations for cooperation within the Supervisory Board and with the Management Board, but that these only relate to internal processes within the body or between the bodies and that making the Rules of Procedure accessible therefore offers no added value for investors. Conversely, however, the Rules of Procedure also contain confidential statements with regard to measures requiring approval, which are deliberately not intended to be published.

6. Recommendation D.2, D.3 sentence 1, D.4, D.5 and D.11 of the Code:

The Code recommends that the Supervisory Board should form professionally qualified committees depending on the specific circumstances of the Company and the number of its members. The respective committee members and the respective chairman of each committee should be named in the Corporate Governance Declaration. The Supervisory Board shall set up an Audit Committee which - insofar as no other committee or the Supervisory Board as a whole, is entrusted with this task - shall deal in particular with the financial audit, the monitoring of the financial auditing process, the effectiveness of the internal control system, the risk management system and the internal auditing system, as well as the final financial audit statements and compliance. The Chairman of the Audit Committee shall have special knowledge and experience in the application of financial auditing principles and internal control procedures and shall be familiar with the final financial audit statements as well as being independent. The Chairman of the Supervisory Board shall not chair the Audit Committee. The Supervisory Board shall form a Nomination Committee composed exclusively of shareholder representatives which nominates suitable candidates to the Supervisory Board for its proposals to the Annual General Meeting for the election of Supervisory Board members. The Audit Committee shall regularly assess the quality of the final financial audit statements.

As the Supervisory Board of the Company consists of only three persons in accordance with the Articles of Association, no committees are formed - apart from the Audit Committee, which is mandatory by law (cf. Sec. 107 para 4 of the German Stock Corporation Act (AktG)). Accordingly, the above recommendations do not apply to the Company in this respect, or the Company cannot comply with the above recommendations. Due to the fact that the Audit Committee is also the body of the Supervisory Board, all members of the Audit Committee, in addition to the body, deal in particular with the financial audit, the monitoring of the financial auditing process, the effectiveness of the internal control system, the risk management system and the internal auditing system, as well as the final financial audit statements and compliance. The Chairman of the Audit Committee also has special knowledge and experience in the application of financial auditing principles and internal control procedures and does not simultaneously hold the office of Chairman of the Supervisory Board. However, the Chairman of the Audit Committee is not in depth familiar with the final financial audit statements and - as explained in Section C.10 - is not independent of the controlling shareholder. The primary objective of the Company was initially to comply with the new statutory obligation to establish an Audit Committee without at the same time adding further members to the Supervisory Board. In view of the extraordinary workload of the Chairman of the Supervisory Board, which would be associated with a combination of the duties of Chairman of the Supervisory Board and Chairman of the Audit Committee, it was more important from the point of view of the Company that the Chairman of the Supervisory Board should not at the same time be Chairman of the Audit Committee, which is why on the one hand the lack of independence of the Chairman of the Audit Committee vis-à-vis the controlling shareholder and on the other hand the lack of familiarity with the final financial audit statements are accepted for the foreseeable future. This is particularly the case against the background that the Supervisory Board, due to its size, corresponds to the Audit Committee and thus the Chairman of the Supervisory Board, who is also familiar with the audit of the financial statements, is also a member of the Audit Committee, which, in the view of the Company, ensures the appropriate competence of the Audit Committee.

7. Recommendation D.12 of the Code:

The Code recommends that the Company should provide appropriate support for the members of the Supervisory Board during their induction into office and during training and development measures, and report on the measures taken in the Supervisory Board's report.

The Company did provide appropriate support to the Supervisory Board members newly appointed by the Annual General Meeting in July 2021 during their induction into office. However, no training or continuing education measures were carried out by the Supervisory Board members during the relevant period, due in particular to the limited opportunities in connection with the CoViD19 pandemic. For the future, the Company again intends to provide appropriate support for the members of the Supervisory Board in terms of training and continuing education measures; discussions with providers of corresponding training courses are currently underway; training courses are intended for the current fiscal year.

8. Recommendation F.2 of the Code:

The Code recommends that the Consolidated Financial Statements and the Group Management Report should be publicly accessible within 90 days of the end of the fiscal year, and the mandatory Interim Financial Information within 45 days of the end of the reporting period.

With regard to the legal requirement to publish the Consolidated Financial Statements within the first four months of the Group's fiscal year, the Company complies with the legal requirements. They were published on 07 April 2021, just a few days after the recommended deadline by the Code. Due to the time required for the careful preparation of Interim Reports, the Company has also followed the statutory publication deadlines for the respective interim reports. However, the Company endeavours to reduce the time required for the publication of Consolidated Financial Statements and Interim Financial Information to an absolute minimum.

9. Recommendation G.3 of the Code:

The Code recommends that, in order to assess the customary nature of the specific total compensation of the members of the Management Board in comparison with other companies, the Supervisory Board uses a suitable comparison group of other companies (peer group comparison), the context of which it discloses.

The contractual documents regarding the compensation of the members of the Management Board does not currently provide for a comparison with the compensation of the Management Board of other companies. Nevertheless, the compensation of the Management Board should be based on the Management Board compensation system resolved at the Annual General Meeting on 23 July 2021, which provides for a comparison with other suitable companies under item 3. An additional explicit mention in the contractual basis of the compensation of the Management Board was therefore not considered necessary. In addition, the previous Management Board member's contract was ultimately an interim contract with a probationary period, which had to be drawn up very quickly due to the change of the Management Board member at short notice in the middle of last year which is why there was insufficient time for a genuine peer group comparison. In the case of the new Management Board member, a peer group comparison is to be carried out promptly and taken into account when determining the customary level of specific total compensation.

10.Recommendation G.4 of the Code:

For the purpose of assessing customary practice within the Company, the Code recommends that the Supervisory Board takes into account the ratio of the compensation of the Management Board to that of senior executive level and the workforce as a whole, and this also in terms of its development over time.

This recommendation is currently not taken into account, as the Company is undergoing a period of upheaval in the fiscal year 2021 and probably still in fiscal year 2022 as a result of the takeover by the new majority shareholder. In addition, the Company had only two employees at the same time below the senior executive level in fiscal year 2021. As the only comparison subjects, these two are not sufficiently meaningful. The Management Board also currently consists of only one sole Management Board member, so that a comparison with the compensation of other Management Board members is also ruled out. Nevertheless, it is intended to take into account the compensation of senior executives and the workforce as a whole in the future, if and to the extent that a comparison appears meaningful.

11. Recommendation G.6 of the Code:

The Code recommends that the variable compensation resulting from the achievement of long-term goals should not exceed the share resulting from the achievement of short-term goals.

This recommendation has not been implemented as the compensation of the Management Board has been affected by the aforementioned takeover process. However, the recommendation can be implemented in the foreseeable future; the Supervisory Board intends to adjust the contractual basis accordingly.

12. Recommendation G.10 of the Code:

The Code recommends that the variable compensation amounts granted to the Management Board member should be invested by the respective member mainly in shares of the Company, taking into account the respective tax burden, or be granted accordingly, share-based.

This recommendation was not implemented as the contractual basis for this was lacking and was not implementable in the current situation of the Company and will not be implementable in the foreseeable future.

13. Recommendation G.11 of the Code:

The Code recommends that the Supervisory Board should have the possibility to take account of extraordinary developments to an appropriate extent. In justified cases, it should also be possible to withhold or demand the return of variable compensation.

This recommendation was not implemented because the Company assumed that the variable compensation model already takes extraordinary developments into account through its automatic mechanism. Firstly, specific criteria are redefined for each Management Board member at the beginning of each year. Secondly, a payable variable compensation only arises if at least 80% of the target, such as EBITDA, is achieved.

14. Recommendation G.12 of the Code:

The Code recommends that in the event of termination of a Management Board contract, the payment of any outstanding variable compensation components attributable to the period up to the termination of the contract should be granted in accordance with the originally agreed objectives and comparison parameters and in accordance with the due dates or holding periods specified in the contract.

From the Company's point of view, this recommendation is achieved by other means: the compensation of the Management Board modifies the recommendation in such a way that the payment of the variable compensation components is even waived if the due date for payment falls on a date after the termination of the Management Board contract. The Company assumed that the Management Board member should only be able to participate in the achievement of the agreed objectives if he or she has an existing Management Board contract, as this was the only arrangement that would bind the Management Board member to the Company. A change is not planned in the foreseeable future.

15. Recommendation G.15 of the Code:

The Code recommends that where members of the Management Board hold Supervisory Board mandates within the Group, the compensation should be credited.

This recommendation was indirectly implemented, but does not contain the envisaged automatism: The contractual basis for the compensation of the Management Board stipulates that prior approval by the Company is required for cases of intra-Group Supervisory Board mandates. In addition, it should only be agreed how to deal with the further intra-Group Supervisory Board mandate once approval has been obtained. The implementation of the recommendation is therefore laid down in the contractual basis and, therefore, can be implemented. The Supervisory Board shall ensure that in cases of intra-Group Supervisory Board mandates the recognition of compensation is also guaranteed in the future.

16. Recommendation G.16 of the Code:

The Code recommends that in the case of the assumption of Supervisory Board mandates from outside the Group, the Supervisory Board should decide whether and to what extent the compensation is to be credited.

This recommendation has been implemented in accordance with the aforementioned explanations to the recommendation G.15: The contractual basis for the compensation of the Management Board also provides for an agreement on how to deal with such mandates in individual cases. The implementation of the recommendation is therefore also laid down in the contractual basis and can therefore be implemented. The Supervisory Board shall ensure that in cases of Supervisory Board mandates from outside the Group the compensation is also taken into account in the future.

17. Recommendation G.17 of the Code:

The Code recommends that the compensation of Supervisory Board members should take appropriate account of the greater time commitment of the Chairman and Vice Chairman of the Supervisory Board and of the chairman and members of committees.

The compensation of Supervisory Board members currently takes into account the Chairman of the Supervisory Board, but not the Vice Chairman of the Supervisory Board or the chairman or membership of committees. In determining the compensation system for the members of the Supervisory Board, the Company assumed that, in view of the intended division of tasks or work among the members of the Supervisory Board, the Chairman of the Supervisory Board would probably have a significantly higher time commitment, but not the Vice Chairman compared with the third member of the Supervisory Board. For this reason, the compensation of the Supervisory Board members only takes appropriate account of the higher time commitment of the Chairman. The Chairman of the Audit Committee is not taken into account because the Company does not anticipate any significant additional expenses in this respect either. As the Company has not formed any committees, apart from the Audit Committee, given the size of the Supervisory Board (three members), the above recommendation is not relevant to the members of committees.

Hallbergmoos, February 2022
STS Group AG
Management Board
Supervisory Board

Declaration by the Executive and Supervisory Boards of STS GROUP AG on the recommendations in accordance with the Government Commission on German Corporate Governance Code in accordance with Section 161 AktG

The Executive Board and Supervisory Board of STS Group AG, headquartered in Hallbergmoos, Freising (the “Company”), hereby declare:

Part A: Period until March 19, 2020

The company complied with the recommendations of the “Government Commission on the German Corporate Governance Code” in the version dated February 7, 2017 (the “old Code”) since the last  declaration of conformity in December 2019 until March 19, 2020 with the following exceptions:

1. Section 3.8 (3) of the old Code:

The old Code recommended that any D&O insurance policy taken out for a Supervisory Board member have a deductible of at least 10% of the loss up to at least the amount of one and a half of the fixed annual compensation of the Supervisory Board member.

The Company’s D&O insurance does not envisage a deductible of this kind for Supervisory Board members. The Company is of the opinion that a deductible is not a suitable means of influencing the motivation and responsibility of Supervisory Board members positively. The deductible would not be appropriate either given that the Supervisory Board members do not receive variable compensation and neither do they participate in any positive corporate development.

2. Section 4.1.3 Sentences 2 and 3 of the old Code:

The old Code recommends that the Executive Board ensure there is an adequate compliance manage-ment system in line with the risk situation of the enterprise and disclose the salient points of this system. In addition, employees and third parties should have a suitable method of providing protected tips in respect to legal violations in the enterprise.

The Company did not have in the relevant period a compliance management system in place, nor a ‘whistleblowing’ system enabling employees and third parties to call attention to legal violations in the company in a suitable, identity-protected fashion. To meet these requirements, the company examined the implementation of a digital compliance management system that provides these functionalities.

3. Section 4.2.3. Sentences 4 and 5 of the old Code:

The old Code recommended that care should be taken when concluding Executive Board contracts to ensure that payments made to Executive Board members on premature termination of their contract, including fringe benefits, do not exceed two years’ compensation (so-called severance payment cap) and compensate no more than the remaining term of the contract.

A severance payment cap will be considered in the future when new Executive Board contracts are concluded. This did not apply to existing contracts and extensions of contracts which did not include a severance payment cap. To this extent these Executive Board contracts were granted grandfathering.

4. Section 5.3.1 to 5.3.3 of the old Code:

The old Code recommended that the Supervisory Board should form professionally qualified committees depending on the specific circumstances of the company and the number of its members. The Supervisory Board shall set up an Audit Committee which - to the extent that no other committee is entrusted with this task – shall deal with the monitoring of accounting, the accounting process, the effectiveness of the internal control system, the risk management system, the internal audit system, the audit of the financial statements and compliance. The Chairman of the Audit Committee shall have special knowledge and experience in the application of accounting principles and internal control procedures. He or she shall be independent and not a former member of the Executive Board of the Company whose appointment ended less than two years ago. The Chairman of the Supervisory Board shall not chair the Audit Committee. The Supervisory Board shall form a Nomination Committee composed exclusively of shareholder representatives which nominates suitable candidates to the Supervisory Board for its proposals to the Annual General Meeting for the election of Supervisory Board members.

The Company’s Supervisory Board consists of only three persons; thus, no committees had been formed. Accordingly, the above recommendations did not apply to the Company.

5. Section 5.4.1 (2) of the old Code:

The old Code recommended that the Supervisory Board shall specify concrete objectives regarding its composition which, whilst considering the specifics of the enterprise, take into appropriate account the international activities of the enterprise, potential conflicts of interest, the number of independent Supervisory Board members within the meaning of Section 5.4.2, an age limit to be specified and a regular limit of length of membership to be specified for the members of the Supervisory Board as well as diversity.

The Supervisory Board had not adopted any resolutions for the relevant period defining concrete objectives goals regarding the composition of the Supervisory Board. The Company believes that the current composition of the Supervisory Board meets the requirements in line with Section 5.4.1 (2) of the old Code. When selecting candidates to be proposed for election to the Supervisory Board, the Company always ensures that candidates have the required knowledge, ability, and personal experience. The Company has thus determined that adopting concrete objectives in respect to composition was  not a suitable means for ensuring that the Supervisory Board was composed of qualified members capable of working efficiently.

6. Section 5.4.6 (1) Sentence 2 of the old Code:

The old Code also recommended that the Chair and Deputy Chair positions in the Supervisory Board as well as the chair and membership in committees be considered when deciding the compensation of Supervisory Board members by resolution of the General Meeting or in Articles of Association.

The compensation scheme for Supervisory Board members took in the relevant period into account the offices of Supervisory Board Chair, Vice-Chair, and committee chairs, but does not take into account committee membership. In view of the size of the Supervisory Board, namely three members, the Company did not consider this necessary.

7. Section 7.1.2 Sentence 3 of the old Code:

The old Code recommended that the consolidated financial statements be made publicly accessible within 90 days after the end of the financial year and interim reports be publicly accessible within
45 days after the end of the reporting period.

The Company met legal requirements to publish the consolidated financial statements within the first four months of the Group’s financial year. Because of the time required to carefully prepare interim reports, until further notice the Company observed the same legal deadlines for publication for the respec-tive interim reports. However, the Company endeavoured to minimize the amount of time required for publication of the consolidated financial statements to the extent possible.

Part B: Period as of March 20, 2020

The Company has complied with the recommendations of the “Government Commission on the German Corporate Governance Code” in its latest version of December 16, 2019, published in the Federal Gazette on March 20, 2020 (the “Code”), since March 20, 2020 and will continue to comply with them in the future, in each case with the following exceptions:

8. Section B.2 of the Code:

The Code recommends that the Supervisory Board should work together with the Management Board to ensure long-term succession planning; the approach should be described in the corporate gover-nance statement.

The corporate governance statement for the financial year 2019, which was published in the relevant period, did not yet contain a description of the approach to long-term succession planning for the Executive Board. Continuity was nevertheless ensured by the Supervisory Board for the 2020 financial year, particularly as the Executive Board member appointed in this period was appointed for an initial period of three years and the incumbent Executive Board member is a relatively very young Executive Board member. In the meantime, the Supervisory Board has worked with the Executive Board to ensure long-term succession planning; the corresponding procedure is to be described for the future and thus already in the management report and corporate governance statement for the 2020 financial year.

9. Section B.5 of the Code:

The Code recommends that an age limit be specified for Executive Board members and stated in the corporate governance declaration.

The Supervisory Board has not passed a resolution specifying a concrete age limit for members of the Management Board, which is why no information can be provided in the corporate governance state-ment. The Supervisory Board is of the opinion that the decisive factor in the selection of candidates is that they are persons who have the knowledge, skills and professional and personal experience required  to properly perform their duties. The Company is convinced that these requirements are not linked to a specific age, which is why the Company does not consider a specific age limit for members of the Board of Management to be suitable for ensuring that the persons concerned have the necessary skills.

10. Section C.1 of the Code:

The Code recommends that the Supervisory Board should specify concrete objectives for its compo-sition and draw up a competence profile for the entire body. In doing so, the supervisory board shall pay attention to diversity. Proposals of the Supervisory Board to the Annual General Meeting should take these objectives into account and at the same time strive to fill out the competence profile for the entire body. The status of implementation shall be published in the corporate governance declaration. This shall also provide information on the number of independent shareholder representatives on the Supervisory Board, as deemed appropriate by the shareholder representatives, and the names of these members.

The Supervisory Board has not passed any resolution formulating concrete objectives regarding the composition of the Supervisory Board or a competence profile for the entire body. The Company is of the opinion that the current composition of the Supervisory Board complies with the requirements of Section C.1 of the Code. When selecting candidates to be proposed for election to the Supervisory Board, the Company always ensures that these are persons who have the knowledge, skills and professional and personal experience required to properly perform their duties. For this reason, the Company concludes that targets set regarding the specific composition are unsuitable for the election of an efficient and qualified Supervisory Board.

11. Section C.2 of the Code:

The Code recommends that an age limit be set for Supervisory Board members and stated in the corporate governance declaration.

The Supervisory Board has not passed any resolution specifying a concrete age limit, which is why no disclosure can be made in the corporate governance statement. With reference to the above explanations on section C.1, the Company is of the opinion that the decisive factor in the selection of candidates is that they are persons who have the knowledge, skills and professional and personal experience required to properly perform their duties. The Company is convinced that these requirements are not linked to  a specific age, which is why the Company does not consider a specific age limit for Supervisory Board members to be suitable for ensuring that the persons concerned have the necessary skills.

12. Section C.10 of the Code:

The Code recommends that the Chairman of the Supervisory Board, the Chairman of the Audit Committee, and the Chairman of the committee dealing with Executive Board compensation should be indepen-dent of the Company and the Executive Board.

The Chairman of the Audit Committee should also be independent of the controlling shareholder. It is the conviction of the Company that the Chairman of the Supervisory Board is independent of the Company and the Executive Board. However, as the Supervisory Board of the Company consists of only three persons in accordance with the Articles of Association, no committees are formed. Accordingly, the Company has neither a Chairman of the Audit Committee nor a Chairman of the committee dealing with the compensation of the Executive Board.

13. Section D.1 of the Code:

The Code recommends that the Supervisory Board should adopt rules of procedure and make them available on the Company’s website.

Although the Supervisory Board has adopted rules of procedure, it has at the same time deliberately decided against publishing the rules of procedure on the Company’s website. The Supervisory Board is of the opinion that the rules of procedure contain very detailed regulations for cooperation within the Supervisory Board and with the Executive Board, but that these only concern internal processes within the body or between the bodies and that making the rules of procedure accessible therefore offers no added value for investors. Conversely, however, the Rules of Procedure also contain confidential state-ments regarding measures requiring approval, which are deliberately not intended to be published.

14. Section D.2, D.3 sentence 1, D.4, D.5 and D.11 of the Code:

The Code recommends that the Supervisory Board should form professionally qualified committees depending on the specific circumstances of the company and the number of its members. The respective committee members and the committee chairman should be named in the corporate governance statement. The Supervisory Board shall set up an Audit Committee which - insofar as no other committee or the full Supervisory Board is entrusted with this task – shall deal with the audit of the financial statements, the monitoring of the financial reporting process, the effectiveness of the internal control system, the risk management system, and the internal auditing system, as well as the audit of the financial statements and compliance. The Chairman of the Audit Committee shall have special knowledge and experience in the application of accounting principles and internal control procedures and shall be familiar with and independent of the audit of the financial statements. The Chairman of the Supervisory Board shall not chair the Audit Committee. The Supervisory Board shall form a Nomination Committee composed exclusively of shareholder representatives which nominates suitable candidates to the Supervisory Board for its proposals to the Annual General Meeting for the election of Supervisory Board members. The Audit Committee shall regularly assess the quality of the audit of the financial statements.

As the Supervisory Board of the Company consists of only three persons in accordance with the Articles of Association, no committees are formed. Accordingly, the above recommendations do not apply to the Company or the Company cannot comply with the above recommendations.

15. Section D.12 of the Code:

The Code recommends that the Company should provide appropriate support for members of the Supervisory Board in their induction into office and in training and development measures, and report on measures carried out in the Report of the Supervisory Board.

It is true that the Company provided appropriate support to the new Supervisory Board members, who were initially appointed by the courts and subsequently confirmed by the Annual General Meeting, during their induction into office. However, no training or continuing education measures were carried out by the Supervisory Board members in the relevant period, due to the limited opportunities in connec-tion with the CoViD19 pandemic. In the future, the Company intends to again provide appropriate support for the members of the Supervisory Board in terms of training and continuing education measures.

16. Section F.2 of the Code:

The Code recommends that the consolidated financial statements and the Group management report should be publicly accessible within 90 days of the end of the financial year, and the mandatory interim financial information within 45 days of the end of the reporting period.

Regarding the statutory requirement to publish the consolidated financial statements within the first four months of the Group’s fiscal year, the Company follows the legal requirements. They were published on April 09, 2020, just a few days after the deadline recommended by the Code. Due to the timing required for careful preparation of interim reports, the Company has also followed the statutory publication dead-lines for the respective interim reports. Due to the change of stock exchange segment from the Prime Standard to the General Standard, the Company is no longer obliged to publish quarterly reports, which is why the second part of the recommendation will in future only refer to the Company’s half-yearly financial report. However, the Company endeavours to shorten the period required for the publication of consolidated financial statements and interim reports to an absolute minimum.

17. Section G.2 of the Code:

The Code recommends that, on the basis of the compensation system, the Supervisory Board should first determine the specific target total compensation for each member of the Board of Management, which should be commensurate with the duties and performance of the member of the Board of Management and the situation of the company and should not exceed the usual compensation without special justification.
The recommendation was only feasible to a limited extent in the relevant period due to the change of Executive Board members and the appointment of the incumbent Executive Board member at short notice. Nevertheless, in the current situation the Supervisory Board is satisfied that the target total compensation of the incumbent Executive Board is commensurate with the situation of the Company and does not exceed the customary compensation for such a position.

18. Section G.7 of the Code:
The Code recommends that the Supervisory Board should determine the performance criteria for all variable compensation components for each member of the Board of Management for the upcoming financial year, which – in addition to operational - should be based primarily on strategic objectives. The Supervisory Board should determine the extent to which individual targets for individual Executive Board members or targets for all Executive Board members together should be decisive.

This recommendation was implemented by the Supervisory Board for the 2019 and 2020 financial years based on the contractual provisions, but implementation was overshadowed by the change in the Executive Board, with the result that no performance criteria have yet been defined for the current Executive Board.

19. Section G.9 of the Code:

The Code recommends that after the end of the financial year, the Supervisory Board should determine the amount of compensation components to be granted individually for that year, depending on target achievement. The achievement of targets should be comprehensible in terms of reason and amount.

This recommendation was implemented by the Supervisory Board regarding the departing Executive Board members for the 2019 financial year on the basis of the contractual provisions. In the absence  of defined criteria for the Executive Board member appointed in the meantime, it was not possible to determine the amount of the compensation components to be granted individually for this year.

20. Section G.10 of the Code:

The Code recommends that the variable compensation amounts granted to the Executive Board member should be invested by him predominantly in shares of the Company, considering the respective tax burden, or granted accordingly on a share-based basis. The Executive Board member should not be able to dispose of the long-term variable grant amounts until after four years.

This recommendation was not implemented as there was no contractual basis for it and it was not feasible in the current situation of the company and will not be feasible in the foreseeable future.

21. Section G.17 of the Code:

The Code recommends that the compensation of Supervisory Board members should take appropriate account of the greater time commitment of the Chairman and Deputy Chairman of the Supervisory Board, as well as the Chairman and members of committees.

The compensation of Supervisory Board members currently considers the chairmanship and deputy chairmanship of the Supervisory Board, but not as well as the chairmanship or membership of com-mittees. The Company does not consider this necessary in view of the size of the Supervisory Board of three members, especially as the Supervisory Board has not formed any committees due to its size.

Hallbergmoos, January 2021

STS Group AG
The Executive Board
The Supervisory Board