Comer Industries S p A : EXPLANATORY REPORT ON LONG TERM INCENTIVE PLAN "LTIP"

Comer Industries S.p.A.

Via Magellano 27 - 42046 Reggiolo (RE)

Registered in the Reggio Emilia Business Register no. 07210440157

Share Capital 18,487,338.60 euros subscribed and paid-up

Tax code 07210440157 - VAT no. IT 01399270352

EXPLANATORY REPORT OF THE BOARD OF DIRECTORS ON THE PROPOSALS ON THE AGENDA OF THE ORDINARY SHAREHOLDERS' MEETING OF April 23, 2024

7TH ITEM ON THE AGENDA

Report prepared pursuant to Article 125-ter of Italian Legislative Decree no. 58 of February 24, 1998, as subsequently amended and supplemented ("TUF") and, if necessary, pursuant to Article 114-bis of the TUF ("Issuers' Regulation") and in accordance with Annex 3A, Schedule 7, of the Issuers' Regulation.

Comer Industries S.p.A.

Via Magellano, 27 - 42046 Reggiolo (RE) Italy -

www.comerindustries.com- E-mail:[e-mail]: [phone] - Fax: [phone]

Reg. Reggio Emilia Business Register no. 07210440157 - Share Capital 18,487,338.60 euros fully paid-up - Tax Code 07210440157 - VAT code IT 01399270352

1. APPROVAL OF AN INCENTIVE PLAN NAMED "COMER INDUSTRIES 2024- 2026 LONG-TERM INCENTIVE PLAN". RELATED AND CONSEQUENT RESOLUTIONS.

Dear Shareholders,

Pursuant to Art. 114-bis of the TUF you have been called to the Shareholders' Meeting to approve Comer Industries' incentive plan called "Comer Industries 2024-2026 Long- Term Incentive Plan" reserved for the Chairman and Chief Executive Officer of Comer Industries, as well as for executives including those with strategic responsibilities and managers who are key resources of the Company and/or its subsidiaries ("Subsidiaries" and, together with Comer Industries, "Group"), and also for other employees ("Grantees").

The Plan is structured in three cycles (i.e., 2024-2026,2025-2027,2026-2028) with a mixed "cash/performance share" form, providing for the free granting of an amount of "cash" ("Bonus") and a specified number of ordinary shares of the Company ("Shares") upon the achievement of specific performance objectives ("Performance Objectives"). The Performance Objectives are verified at the end of the three-year performance periods between the grant date of the benefit and December 31 of each reporting year, i.e., December 31, 2026, December 31, 2027, and December 31, 2028 ("Performance Period").

The Plan will be serviced by Comer Industries own shares that are already in the Company's portfolio or that will be acquired by the Company in execution of the authorizations granted from time to time by the Shareholders' Meeting.

The information document relating to the Plan prepared pursuant to Article 84-bis and Schedule No. 7 of Attachment 3A of the Issuers' Regulation ("Information Document") will be made available to the public within the terms of the law on the Company's website www.comerindustries.com in the "Governance", Shareholders' Meeting section, as well as on the E-Market storage mechanism (www.emarketstorage.com), together with this report.

1. Reasons for adopting the Plan

The Plan is a pillar of the Remuneration Policy submitted to the Shareholders' Meeting for approval as well as a fundamental component of engagement in the medium to long term of key people in the Company and the Group.

Specifically, the Plan aims to: (i) incentivize the retention of resources who can make a decisive contribution to the success of the Company and/or the Group; (ii) foster the loyalty of the Grantees of the Plan in a long-term perspective through personal satisfaction and motivation and by developing their sense of belonging to the Company and/or the Group; (iii) link the Grantees' variable remuneration to the achievement of Performance Objectives, to be assessed over a future multi-year time frame, so as to align the Grantees' interests with the pursuit of the priority objective of creating value

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for Shareholders in a long-term perspective, through careful management of business risks and the pursuit of multi-year programs and projects, also having regard to sustainable growth.

Indeed, among other things the Plan proposes to extend the time horizons of the decision-making processes of key corporate actors for the Company and/or the Group (so-called long term perspective), promoting the alignment of the interests of the latter with those of the Company's shareholders over a multi-year time horizon; all through the awarding of incentives to the Grantees, the payment of which is subject to the achievement of certain Objectives during the Performance Period and subject to a holding period (i.e., lock-up, see below).

The above, also in view of the fact that the recommendations of the "Code of Corporate Governance" applicable to listed companies recognize share-based compensation plans for executive directors and top management as a tool that is well-suited to incentivizing

"alignment with shareholder interests over a long-term time horizon, providing that a prevailing part of the plan has an overall vesting period of rights and retention of the shares granted of at least five years."

1. Purpose and method of implementation of the PlanThe purpose of the Plan is:

1. at the end of the Performance Period and upon the achievement of the Performance Objectives, the free granting to the Grantees of a maximum of 280,928 Shares (in the Plan's three cycles) already outstanding and in the Company's portfolio, or subsequently acquired pursuant to Article 2357 et seq. of the Italian Civil Code, as well as
2. at the end of the Performance Period and upon the achievement of the Performance Objectives, the payment to the Grantees of the Bonus.

The Grantees and the amount of the Shares and Bonus to be granted to each of the Grantees will be discretionally and unquestionably determined by the Board of Directors, or a person delegated thereby, on the Grant Date, when approving the Rules, having regard to the strategic relevance of the respective position held and the levels of fixed remuneration received annually, ensuring an overall competitive level of remuneration.

The number of Shares and the amount of the Bonus that each of the Grantees will be entitled to receive shall be determined by the Board of Directors at the end of the Performance Period after consulting the Appointment and Remuneration Committee, based on the outcome and verification of the level of achievement of the Performance Objectives carried out at the time of approval of the consolidated financial statements for the relevant fiscal year.

The Performance Objectives consist of typical financial management objectives (i.e., Consolidated EBITDA), also taking into consideration environmental, social, and governance aspects (so-called ESG factors or just "ESG"), and in particular the ESG

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factor related to the intensity of CO2 emissions, as shown in the following table.

Objectives	Weight	Min	Target	Max
Consolidated EBITDA	90%	95%	100%	100%
ESG: intensity of CO2 emissions	10%	90%	100%	100%

The granted Shares have regular dividend rights, and therefore the rights attached to them accrue to each Grantee from the moment the Grantee becomes the owner of the Shares. It is understood that 50% of the Shares that the Grantee shall be entitled to receive under the Plan (with the exception of the Shares that may be subject to sale to cover the tax liability arising from the grant itself) may not be transferred or subject to liens or be the subject of other acts of disposition among living persons for any reason whatsoever for a period of 24 months ("Lock-Up") from the date of actual delivery of the Shares.

The Company shall make the Shares and Bonus due to the Grantee available following the verification of the Performance Objectives within the terms and in the manner to be set forth in the Plan's rules ("Rules").

For more details on the Plan, see the Plan Information Document.

1. Recipients of the Plan

The Plan is addressed to the Chairman and Chief Executive Officer of Comer Industries, as well as executives, including those with strategic responsibilities, and managers who are key resources of the Company and/or Subsidiaries, and also other employees.

The Plan is therefore to be considered of "particular relevance" under Article 114-bis, paragraph 3, of the TUF and Article 84-bis, paragraph 2, of the Issuers' Regulation.

1. Methods and clauses for the implementation of the Plan, with particular reference to its duration and the conditions for the granting of the shares

The Plan has three single cycles of Share and Bonus grants (i.e., 2024-2026, 2025- 2027, 2026-2028), each with a three-year Performance Period.

The Plan will therefore last until the approval of the financial statements for the year ending December 31, 2028. The Plan will end in 2031, on the date of termination of the Lock-Up restriction on the Shares granted to the Grantees at the end of the Plan's third cycle.

The right to receive the Shares and Bonus granted is subject to the fulfillment of both of the following conditions:

1. the achievement of the Economic-Financial and ESG Performance Objectives defined for the Performance Period and established by the Board of Directors, subject to the opinion of the Committee, when approving the Rules;

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1. at the end of the Performance Period, the Grantee's relationship with the Company or the Subsidiary is still in place and their status as a Grantee within the Company, the Subsidiary or the Group has not ceased with respect to the role held, except in the case of a good leaver (as indicated in the Information Document and detailed in the Plan rules).

The grant letter sent to each Grantee will contain details of the Shares and Bonus granted, the Performance Objectives and their values.

Without prejudice to any other right or remedy however provided in favor of the Company and Subsidiaries by applicable provisions of law or contract, the Rules shall include clawback clauses in favor of the Company, in terms to be detailed by the Rules.

1. Possible support for the Plan from the Special Fund for the Encouragement of Worker Participation referred to in Article 4, Paragraph 112, of Italian Law no. 350 of December 24, 2003

The Plan will not receive any support from the Special Fund for the Encouragement of Worker Participation in Enterprises referred to in Article 4, paragraph 112, of Italian Law no. 350 of December 24, 2003.

1. Limits on the transfer of the granted rights and shares

The Grantees' right to participate in the Plan will be granted to them free of charge and personally and may not be transferred by deed between living persons or be subject to liens or be the subject of other acts of disposition in any capacity.

Fifty percent of the Shares that the Grantee will be entitled to receive under the Plan (except for the Shares that may be subject to sale to cover the tax liability arising from the grant itself) are subject to Lock-Up commencing on the effective date of delivery of the Shares.

For more information, see the Information Document made available to the public on the Company's website at www.comerindustries.com (in the "Governance", Shareholders' Meeting section).

In light of the above, the Board of Directors submits for your approval the following

Proposed resolution:

"Having seen and approved the report of the Board of Directors and the information document prepared pursuant to Article 84-bis of the Issuers' Regulation relating to the incentive plan called "Comer Industries 2024-2026Long-Term Incentive Plan", the Shareholders' Meeting of Comer Industries S.p.A.

resolves

1. To approve the incentive plan called "Comer Industries 2024-2026Long-Term Incentive Plan," the rules of which will be approved by the Comer Industries

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S.p.A. Board of Directors following this resolution.

1. To grant the Company's Board of Directors any necessary and/or appropriate power to execute the aforesaid Plan, and thus for each cycle of the Plan, including but not limited to: all powers to approve the Plan's rules; for each cycle to exclude or include the grantees by name, including through a person delegated thereby; for each cycle to determine the number of shares and the amount of the bonus to be granted to each grantee and to proceed with their granting; for each cycle to establish the performance objectives, as well as determine the level of achievement of such objectives, and in general perform any action, obligation, formality and communication necessary or appropriate for the management and/or implementation of the Plan, with the right to delegate its powers, duties and responsibilities with respect to the execution and implementation of the Plan to the Company's Chief Executive Officer, it being understood that any decision regarding and/or pertaining to a grantee of said Plan who is also an executive director of the Company (as well as any other decision regarding and/or pertaining to the management and/or implementation of the Plan with respect to them) shall remain the sole responsibility of the Board of Directors."
2. • * * *

Reggiolo, March 14, 2024

For the Board of Directors

The Chairman

Matteo Storchi

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