Seco S p A : Ordinary Shareholders' Meeting - Explanatory Report of the BoD on item 1 on the agenda

EXPLANATORY REPORT

OF THE BOARD OF DIRECTORS

OF SECO S.P.A.

ON POINT 1) OF THE AGENDA

OF THE ORDINARY SHAREHOLDERS' MEETING CALLED FOR

JULY 28, 2023 IN SINGLE CALL

prepared pursuant to Article 114-bis and Article 125-ter of Legislative Decree No. 58 of February

24, 1998, as amended

June 27, 2023

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Explanatory report of the Board of Directors of SECO S.P.A. prepared pursuant to Article 114-bis and Article 125-ter of Legislative Decree No. 58 of February 24, 1998, as amended

Dear Shareholders,

the Board of Directors of SECO S.p.A. (hereafter, "SECO" or the "Company") (the Company, together with its subsidiaries as per Article 93 of Legislative Decree No. 58/1998, the "Group"), has called you to the Ordinary and Extraordinary Shareholders' Meeting, for July 28, 2023 at the time of 9AM, at the offices of Notary Jacopo Sodi, in Florence, Via dei Della Robbia 38, in single call, to discuss and consider, among other matters, the following point 1) on the Agenda of the Ordinary session:

1. Proposal to approve the "2024-2027Chief Executive Officer Stock Option Plan". Resolutions thereon as per Article 114-bis of Legislative Decree No. 58/1998.

With this report (the "Report") - prepared pursuant to Article 114-bis and Article 125-ter of Legislative Decree No. 58 of February 24, 1998, as subsequently amended ("CFA"), we wish to provide an explanation of the reasons for the proposals related to point 1 on the Agenda of the Shareholders' Meeting, in Ordinary session.

Specifically, the Board of Directors has called you to the Shareholders' Meeting to discuss and resolve on the approval, pursuant to Article 114-bis of the CFA, of an incentive and loyalty plan called the "2024-2027 Chief Executive Officer Stock Option Plan " (hereinafter the "Plan"), based on the free grant to the Company's current Chief Executive Officer (the "Beneficiary") of 4 million options (hereinafter the "Options"), entitling him/her to receive an amount of ordinary shares of the Company calculated as follows:

1. 1 (one) newly-issued SECO ordinary share for each 1 (one) Option exercised, in case of exercise of the Options with payment of the Exercise Price; or, alternatively;
2. at the request of the Beneficiary to the Company and upon the Company 's consent a variable number of ordinary SECO treasury shares determined according to the market price of the shares on the date of exercise of the Options, granted free of charge and therefore without payment of the exercise price, as outlined in greater detail in the Plan Prospectus, attached to this Report.

The resolution submitted to the Shareholders' Meeting for approval is subject to the approval of the resolution to increase the paid-in share capital set out in Agenda Item 1 of today's Extraordinary Shareholders' Meeting.

The proposal for the adoption of the Plan formulated by the Board of Directors' resolution on June 27, 2023 took into account the proposal of the Appointments and Remuneration Committee, which met on June 16, 2023, as well as the opinion of the Related Parties Committee, which met on June 21, 2023.

Preliminarily, it is indicated that, in view of the strong results achieved and the management of the Group's growth (including prospective), it is in the Company's interest to maintain the relationship with the Beneficiary for the 2024-2026three-year period ("Next Three-YearPeriod") and for such purposes it is deemed useful and appropriate to now define the terms and conditions of the renewal of the relationship with the Beneficiary for the Next Three-Year Period. That covered by the proposal submitted to the Shareholders' Meeting is consistent, on the one hand, with the Company's 2023 Remuneration Policy (as illustrated in the relevant Section I), approved by the Shareholders' Meeting

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of April 27, 2023 (the "Policy"), which is key to the pursuit of the sustainable success of the Company and the need to attract, retain and motivate people with the expertise and professionalism required by the role held at the Company, and, on the other hand, with the objective of the Policy to which a significant portion of the Executive Directors' remuneration is linked, also in the form of monetary incentive plans and/or those based on financial instruments, to the financial results achieved by the Issuer and/or the achievement of specific pre-set objectives that are not exclusively short-term.

In this regard, the Plan represents the instrument for achieving the above objectives, supplementing the fixed component and the variable component of a short-term monetary nature (linked to annually defined objectives, in line with that approved by the Shareholders' Meeting of the Company of April 27, 2023 and with the 2023 Remuneration Policy approved by the same Shareholders' Meeting), through a medium-to-long-term variable component based on financial instruments, to be granted according to the achievement of certain objectives for the growth of the Company's value, in accordance with the best market practice approach, while maintaining the principle of sound and prudent management of the Group's activities and of the related risks.

It should also be noted that the Plan is resolutely conditional on the event that, at the Shareholders' Meeting called to appoint the new Board of Directors for the Next Three-Year Period ("New Board of Directors"), on the approval of the financial statements for 2023, the Beneficiary is not elected as a member of the New Board of Directors and that he/she is not entrusted with the office and delegated powers as Chief Executive Officer by the New Board of Directors;

With regards to the motives underlying the proposal to approve the Plan, it has the objective of (i) involving and incentivizing the Beneficiary, whose activity is deemed of fundamental importance to the achievement of the Group's strategic objectives, (ii) building the Beneficiary's loyalty by incentivizing his/her retention in the Group, and (iii) aligning the Beneficiary's interests with those of the Company and the shareholders over the Plan's time horizon by recognizing the Beneficiary's contribution to increasing the value of the Company.

The objectives of the Company in adopting the Plan, in addition to its formulation, are in line with that recommended by Article 5 of the Corporate Governance Code promoted by the Corporate Governance Committee of Borsa Italiana S.p.A. and the principles of the Policy.

The proposed Plan covers a long-term timeframe (2024-2027) with the maturing of Options in two tranches. Specifically, the Options granted under the first tranche vest upon completion of a vesting period as follows: (i) for 1 million Options, 12 (twelve) months after the Shareholders' Meeting appointing the New Board of Directors, with an exercise price of the Options equal to Euro 5.90; (ii) for an additional 1 million Options, 24 (twenty-four) months after the Shareholders' Meeting appointing the New Board of Directors, with an exercise price of the Options equal to Euro 5.90; (iii) for an additional 1 million Options, as of the earliest date between (a) 36 (thirty-six) months after the Shareholders' Meeting appointing the New Board of Directors and (b) the date on which the Board of Directors is reappointed by the Shareholders' Meeting at the time of the approval of the financial statements for the year 2026, with an exercise price of the Options equal to Euro 5.90. The 1 million Options granted under the second tranche, may be exercised as of the earliest date between (a) 36 (thirty-six) months after the Shareholders' Meeting called to appoint the New Board of Directors and (b ) the date on which the Board of Directors is reappointed by the Shareholders' Meeting at the time of the approval of the financial statements for the year 2026, with an exercise price of the Options equal to Euro 10.00.

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The Plan also establishes an alternative means to grant the shares to the Beneficiary without the payment of the exercise price. In this case, the number of ordinary SECO treasury shares granted for free shall be variable and established on the basis of the market price of the shares at the date of exercise of the Options.

The Options granted may be exercised by the Beneficiary in arrears in the years following vesting, within eight years of the Shareholders' Meeting to appoint the New Board. The Plan does not require conditions to be met related to the achievement of certain economic/financial performance targets. The granting of Options is however linked to the position held by the Beneficiary, according to the cases of good leavership, bad leavership and leavership, in line with market practice.

For further information on the key features of the Plan - and in particular, by way of example, the procedures and clauses for its implementation, as well as the determination of the exercise price of the Options and the restriction on the non-transferability of the Options - please refer to the information document attached to this Report and prepared pursuant to Article 84-bis of Consob Regulation No. 11971/1999, as subsequently amended and supplemented, in accordance with the indications contained in Schedule No. 7 of Annex 3A of the Regulation.

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Dear Shareholders,

in view of that outlined, we propose the following resolutions:

"The Ordinary Shareholders' Meeting of SECO S.p.A.,

• having acknowledged the explanatory report of the Board of Directors concerning the "2024-2027 Chief Executive Officer Stock Option Plan"

RESOLVES

1. to approve, pursuant to and in accordance with Article 114-bis of Legislative Decree No. 58/1998, the establishment of a new incentive plan called the "2024-2027 Chief Executive Officer Stock Option Plan" having the characteristics (including the conditions and prerequisites for implementation) illustrated in the Prospectus attached to the Board of Directors' Explanatory Report, empowering the Board of Directors to adopt the relevant regulations and delegating the implementation and administration of the Plan to the Board of Directors of the Company, with the right to sub-delegate to the Chairperson;
2. to grant the Board of Directors, with the right to sub-delegate to the Chairperson, any power necessary or appropriate to implement the "2024-2027 Chief Executive Officer Stock Option Plan" and thus, in particular, by way of example only, any power indicated in the Prospectus prepared pursuant to Article 84-bis of Consob Regulation No. 11971/1999, as subsequently amended and supplemented, including any power to make allocations to the beneficiaries, make any necessary or appropriate amendments and/or additions to the Plan, within the limits permitted by the applicable regulations and according to the applicable adjustment criteria and generally-accepted financial markets methods, also in the case of any corporate transactions affecting the company share capital structure and/or which modify the financial content of the Plan, extraordinary and/or non-recurring and/or non-core activity events, significant changes to the economic environment and/or other events which may affect the shares and, more generally, the Plan, in order to adjust it to the altered situation and reflect the above changes, while at the same time maintaining the substantial content and financial content of

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the Plan unchanged, as well as perform any act, fulfillment, formality, and/or communication that is necessary or appropriate for the purposes of managing and/or implementing the Plan."

Arezzo, June 27, 2023

For the Board of Directors

The Chairman

Daniele Conti

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