Notes to the statutory financial statements - SoftwareOneAnnual Report 2022

1 General

SoftwareONE Holding AG is the holding company of the SoftwareOne group and holds all investments, directly or indirectly, in SoftwareOne group companies.

SoftwareONE Holding AG’s income primarily comprises fair value gains, dividends, interest income from subsidiaries, recharges for some administrative expenses and treasury shares to other group companies. SoftwareONE Holding AG does not have any employees, nor does it have any research or development activities.

SoftwareONE Holding AG’s risk management is integrated into the group-wide risk management system of SoftwareOne group. Risks identified are assessed individually based on their probability of occurrence and scope of potential losses. Appropriate measures are defined for the individual risks. Risks are systematically collected and updated once a year. The risk situation and the implementation of the measures defined are monitored. The Board of Directors of SoftwareONE Holding AG addresses the topic of risk management at least once a year. Please refer to Note 4 Financial risk management of the consolidated financial statements for an explanation of group-wide risk management at SoftwareOne group.

SoftwareONE Holding AG will continue to act as the holding company of the SoftwareOne group in the 2023 financial year. There are no plans to change the company’s business activities.

2 Accounting principles

The financial statements of SoftwareONE Holding AG, Stans, have been prepared in accordance with the provisions of Swiss accounting legislation (Title 32 of the Swiss Code of Obligations).

The following section describes the main valuation principles applied that are not specified by law.

Financial assets

Financial assets are valued at their acquisition cost adjusted for impairment losses.

Property, plant and equipment

Property, plant and equipment are valued at acquisition costs less accumulated depreciation and impairment losses. Expected useful life of real estate is 33.33 years.

Investments

Investments are valued at their acquisition cost adjusted for impairment losses.

Derivative financial instruments

In case of a positive value, no asset is recognised. In case of a negative value a liability is recognised (classified as non-current when the remaining maturity is more than 12 months and as current when the remaining maturity is less than 12 months.

Treasury shares

Treasury shares are recognised at acquisition cost and deducted from shareholders’ equity at the time of acquisition. The gain or loss related to treasury shares is recognised directly in equity.

3 Financial assets

Financial assets are solely related to shares in the listed company Crayon Group Holding ASA.

In 2022, the company started to sell down the investment in Crayon in several steps. In this context the company entered into a NOK denominated total return swap (TRS) agreement in December 2022. The nominal value of the TRS is CHF 42,5 million. The TRS counterparty charges quarterly interest, based on NIBOR 3M plus margin.

Under the TRS, SoftwareOne sold the underlying shares but remains exposed to changes in the market value of these shares. In the event of a negative market price development, there is a risk of a cash outflow when agreed thresholds are exceeded up to the amount of the consideration received. At the end of the reporting period, the total return swap had a positive market value.

4 Investments

All investments except SoftwareONE AG are indirectly held. For details, please refer to Note 30 List of group companies in the consolidated financial statements.

5 Share capital

The share capital as of 31 December 2022 was composed of 158,581,460 (2021: 158,581,460) fully paid-in registered shares, each with a nominal value of CHF 0.01.

6 Capital contribution reserve

The reserves from capital contributions (Swiss) include the premium from the capital increase in 2015 and the gain on treasury shares used for share-based payments of group entities. The reserves from capital contributions (non-Swiss) result from the COMPAREX acquisition in 2019.

7 Treasury shares

The following table summarises the balance of treasury shares:

	Number of shares	Average in CHF	In CHF 1,000


Total treasury shares as of 1 January 2021	4,016,801	2.65	10,650
Distribution to employee share plans	–264,490	4.85	–1,283
Distribution to members of the Board of Directors	–27,846	5.40	–150

Total treasury shares as of 1 January 2022	3,724,465	2.47	9,217
Distribution to employee share plans	–162,609	5.40	–878
Distribution to members of the Board of Directors	–45,025	5.40	–243

Total treasury shares as of 31 December 2022	3,516,831	2.30	8,096

8 Dividend income

Dividend income comprises dividends received from subsidiaries.

9 Financial income

in CHF	2022	2021

Interest income	2,769,688	2,324,108
Foreign exchange gains	22,796,427	–
Gain on disposal of financial assets 1)	98,444,350	–

Total financial income	124,010,465	2,324,108

1) Disposal of 10.40 % Crayon Group Holding ASA shares thereof 5.13 % under TRS.

10 Administrative expenses

in CHF	2022	2021

Personnel expenses BoD	–1,605,078	–1,505,307
Legal, consulting and other professional fees	–8,735,289	–4,245,606
Other	–432,916	–96,962

Total administrative expenses	–10,773,283	–5,847,875

11 Financial expenses

in CHF	2022	2021

Interest expenses	–41,318	–
Bank charges	–987,374	–146,200
Foreign exchange loss	–21,640,817	–3,724,043

Total financial expenses	–22,669,509	–3,870,243

12 Major shareholders

Shareholder/group of shareholders	Shares held	% of voting rights

Dr. Daniel Marc von Stockar- Scherer-Castell, Naxxar, Malta 1)	17,517,529 (PY: 17,505,107)	11.06 % (PY: 11.05 %)
B. Curti Holding AG 1) 2)	16,031,853 (PY: 16,031,853)	10.11 % (PY: 10.11 %)
René Rudolf Gilli, Emmetten, Switzerland 1)	12,449,637 (PY: 12,449,637)	7.85 % (PY: 7.85 %)
UBS Fund Management 3)	8,022,013 (PY: 4,806,309)	5.05 % (PY: 3 %)
Pictet Asset Management SA 4)	5,154,610 (PY: 5,154,610)	3.25 % (PY: 3.25 %)

1) Messrs Curti, von Stockar-Scherer-Castell and Gilli have entered into a shareholder agreement and form a group for purposes of Swiss disclosure rules and regulations, controlling 29 % of voting rights. The representative of this group of shareholders is Dr. Beat Curti, Erlenbach, Switzerland.

2) B. Curti Holding AG, Sarnen, Switzerland, is the direct shareholder of the shares which are indirectly controlled by Dr. Beat Alex Curti, Erlenbach, Switzerland.

3) Based on the disclosure notification published on 12 March 2022.

4) Based on the disclosure notification published on 2 November 2019.

13 Shares held by members of the Board of Directors and Executive Board

The table below shows the shareholdings of the Board of Directors (BoD) and closely related persons to the members of the BoD as of 31 December 2022.

Members of the BoD	Number of directly held shares 1)		Total shareholdings as of 31 December 2022	Total shareholdings as of 31 December 2021
Members of the BoD	Vested shares	Blocked shares 2)	Total shareholdings as of 31 December 2022	Total shareholdings as of 31 December 2021

Daniel von Stockar	17,489,874	27,655	17,517,529	17,505,107
Peter Kurer	299,630	11,752	311,382	286,103
José Alberto Duarte	–	9,678	9,678	5,331
René Gilli (3)	12,445,068	4,569	12,449,637	12,449,637
Timo Ihamuotila	20,000	11,061	31,061	26,093
Marie-Pierre Rogers	23,745	11,061	34,806	21,838
Jean-Pierre Saad 4)	–	5,331	5,331	5,331
Adam Warby	4,000	6,830	10,830	6,483
Isabelle Romy	–	6,830	6,830	2,483
Jim Freeman	–	4,347	4,347	–

Total	30,282,317	99,114	30,381,431	30,308,406

1) Ordinary registered shares of SoftwareONE Holding AG.

2) At grant, a restriction period of three years is applied.

3) René Gilli retired from BoD effective 5 May 2022.

4) Jean-Pierre Saad retired from BoD effective 5 May 2022. Representatives of the share ownership in SoftwareONE of Westminster Bidco S.à r.l., Luxembourg, the Grand Duchy of Luxembourg, which is the direct shareholder of the shares indirectly and beneficially owned by funds advised by KKR, with its principal executive offices in New York, USA.

The table below shows the shareholdings of the Board of Directors (BoD) and closely related persons to the members of the BoD as of 31 December 2021.

Members of the BoD	Number of directly held shares 1)		Total shareholdings as of 31 December 2021	Total shareholdings as of 31 December 2020
Members of the BoD	Vested shares	Blocked shares 2)	Total shareholdings as of 31 December 2021	Total shareholdings as of 31 December 2020

Daniel von Stockar	17,489,874	15,233	17,505,107	17,498,012
Peter Kurer	279,630	6,473	286,103	283,088
José Alberto Duarte	–	5,331	5,331	2,848
René Gilli	12,445,068	4,569	12,449,637	12,447,509
Timo Ihamuotila	20,000	6,093	26,093	13,255
Marie-Pierre Rogers	15,745	6,093	21,838	19,000
Jean-Pierre Saad 3)	–	5,331	5,331	2,848
Beat Curti 4)	–	–	–	16,031,853
Adam Warby	4,000	2,483	6,483	–
Isabelle Romy	–	2,483	2,483	–

Total	30,254,317	54,089	30,308,406	46,298,413

1) Ordinary registered shares of SoftwareONE Holding AG.

2) At grant, a restriction period of three years is applied.

3) Representatives of the share ownership in SoftwareONE of Westminster Bidco S.à r.l., Luxembourg, the Grand Duchy of Luxembourg, which is the direct shareholder of the shares indirectly and beneficially owned by funds advised by KKR, with its principal executive offices in New York, USA.

4) B. Curti retired from the BoD effective 8 October 2020. Shares held indirectly through partnership interests in B. Curti Holding AG, which holds ordinary registered shares of SoftwareONE.

The table below shows the shareholdings of the Executive Board (EB) and closely related persons to the members of the EB – such as spouses – as of 31 December 2022.

EB members	Number of directly held shares		Total shareholdings as at 31 December 2022	Total shareholdings as at 31 December 2021
EB members	Vested shares 1)	Blocked shares 2)	Total shareholdings as at 31 December 2022	Total shareholdings as at 31 December 2021

Dieter Schlosser	918,788	–	918,788	858,788
Alex Alexandrov	758,626	–	758,626	982,823
Neil Lomax	892,948	–	892,948	872,948
Bernd Schlotter	33,000	–	33,000	–
Rodolfo Savitzky	53,340	–	53,340	–
Julia Braun 3)	–	–	–	–
Hans Grüter 4)	–	–	–	436,954

Total	2,656,702	–	2,656,702	3,151,513

1) Also includes shares individually purchased under the ESP.

2) Consisting of MEP restricted shares, subject to staggered restriction periods for a term of three years with early leaver conditions.

3) Julia Braun joined SoftwareOne effective 1 November 2022.

4) Hans Grüter retired from the EB effective 31 December 2021.

The table below shows the shareholdings of the Executive Board (EB) and closely related persons to the members of the EB – such as spouses – as of 31 December 2021.

Members of the EB	Number of directly held shares		Total shareholdings as at 31 December 2021	Total shareholdings as at 31 December 2020
Members of the EB	Vested shares 1)	Blocked shares 2)	Total shareholdings as at 31 December 2021	Total shareholdings as at 31 December 2020

Dieter Schlosser	714,822	143,966	858,788	858,788
Hans Grüter	292,988	143,966	436,954	436,954
Alex Alexandrov	806,026	176,797	982,823	915,623
Neil Lomax	728,982	143,966	872,948	781,183
Bernd Schlotter	–	–	–	–

Total	2,542,818	608,695	3,151,513	2,992,548

1) Also includes shares individually purchased under the ESP.

2) Consisting of MEP restricted shares, subject to staggered restriction periods for a term of three years with early leaver conditions.

14 Shares or options on shares for members of the Board and Executive Board

For disclosures related to shares and options held by members of the Board and Executive Board please refer to section 'Share ownership' of the Compensation Report.

15 Events after the reporting period

none