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Hapimag AG | Annual General Meetjng 2018

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Hapimag AG | Annual General Meetjng 2018

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(words of Giatgen Peder Fontana) Dear Shareholders, Dear Guests, On behalf of the Board of Directors and the Executjve Board, I would like to welcome you to today’s 54th Annual General Meetjng of Hapimag AG here in the Waldmannhalle in Baar. With me on the podium are my fellow member of the Board of Directors and Vice President Stefan Schalch, our CEO Hassan Kadbi and Saverio Albertj, our CFO. I would also like to welcome our two honorary presidents Walter Bippus and Dr Guido Renggli, all Hapimag employees atuending and the media representatjves present. I would like to extend a partjcular welcome to all shareholders who are following the live streaming

• f the proceedings at today’s Annual General Meetjng at home.

Before I hand you over to our CFO, who will talk about the management report on the 2017 fjnan- cial year, please allow me very briefmy to address the specifjc situatjon of Hapimag as the business is currently developing. The Board of Directors and the management have been intensively studying over the past year how Hapimag’s business model can be further developed. In this respect, we can build on a proven con- cept of part-ownership and a special holiday model based on subscriptjon points. Since 1963, we have been devotjng ourselves to meetjng the wishes and needs of our shareholders, members and guests. We atuach great importance to ofgering a comprehensive and up-to-date range

• f services.

In 2017, the Board of Directors reviewed the ownership strategy and adjusted the company’s goals in line with its corporate strategy. When analysing the business, the Board of Directors and the Executjve Board quite clearly saw the

• pportunitjes and prioritjes for our company.

Hapimag’s strategy is based on four drivers of value: steady growth, simplifjcatjon of processes, qual- ity improvement and increased productjvity. We seek a cost-disciplined operatjng model with a simpler corporate structure. In fjnancial year 2017, we reorganised and began a process of renewing the Executjve Board on the basis of the CEO leader-

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ship model. We placed the supportjng functjons of central management at the service of the 57 resorts and focused on the core business of accommodatjon. I refer you to this year’s reportjng in the Annual Report and the renewed corporate governance di- rectjve, which is accessible to shareholders on our homepage. For today’s resolutjons we have also added amendments to the Artjcles of Associatjon to the agenda regarding electjons for the Board of Directors and an audit advisory board. In all our key metrics we have achieved great progress. Rising sales and a disproportjonate improve- ment in the consolidated result are a sound achievement and form a good basis on which to build. It is true to say that – with a constant CHF/EUR exchange rate – at an adequate level of occupancy for our 57 resorts with 5 330 accommodatjon units and around 3 million overnight stays we are able to achieve a consolidated result for the year of over EUR 10 million. We demonstrated this in fjnancial year 2017 with around 2.7 million overnight stays and a consoli- dated result of over EUR 11 million. In the future, it is crucial that we improve our management style, how we learn to deal with errors and how we recruit young talent. In this respect, I look with great hope to our Board of Directors member Philipp Ries with his wide-ranging knowledge and his experience at technology fjrm Google. Hapimag has to know how such technology champions tjck in order to understand how we can draw benefjt from the use of new technology with our business model. Afuer all, we will achieve future increases in our productjvity primarily through mastering processes and making corresponding quality improvements. I would now like to hand you over to Saverio Albertj, our Chief Financial Offjcer, who will present the management report for fjnancial year 2017. Over to you, Saverio.

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(words of Saverio Albertj) Buongiorno and good morning Shareholders, Ladies and Gentlemen. I, too, would like to wish you a warm welcome here in Baar. Today, I have the pleasurable task of presentjng a good result for fjnancial year 2017 to you. I will explain to you over the coming minutes what this positjve result is made up of in detail.

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For the fjrst tjme, the annual fjnancial statements were prepared in accordance with Swiss GAAP FER, as we had announced at the last AGM. Because of the switch in accountjng from IFRS to Swiss GAAP FER, the annual result for the previous year has been adjusted from EUR 0.8 million to EUR 0.3 million. The main adjustment was made in pension obligatjons. This makes the fjgures recorded in the 2017 Annual Report comparable for the two years. Hapimag’s consolidated annual accounts for 2017 show a consolidated result of EUR 11.1 million (previous year: EUR 0.3 million). The operatjng result increased from EUR 8.5 million to EUR 12.9 million. At EUR 176.6 million, Hapimag’s operatjng income was down EUR 12.2 million compared to the previous year (EUR 188.8 million). On the other hand, operatjng expenses fell EUR 16.6 million to EUR 163.7 million (previous year: EUR 180.3 million). The difgerence in operatjng income compared to the previous year is primarily due to the book profjt from the sale of resorts of EUR 11.5 million in 2016. The difgerence in operatjng expenses compared to the previous year is the result of cost-cuttjng measures at headquarters – the efgect was minus EUR 5.2 million – as well as points credited to shareholders and members for each annual charge (loyalty points) paid in 2016, at EUR 7.0 million. The Hapimag Group thus achieved an operatjng result of EUR 12.9 million. Afuer deductjon of the fjnancial result and income taxes, the consolidated result in fjnancial year 2017 was therefore EUR 11.1 million. The difgerence in the fjnancial result and income taxes was likewise largely atuributable to resort sales in 2016 – an efgect of EUR 6.5 million.

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In detail, operatjng income was made up of the following elements: Sales of right-of-residence products with net sales revenue of EUR 10.8 million and the resultjng sales afgectjng the income statement of EUR 2.7 million. The annual charge with sales of EUR 72.2 million. The difgerence is atuributable in partjcular to the lower stock of shares. The Resorts division made a signifjcant contributjon to the improved operatjng performance. Although resorts such as London, Porto Heli and Sonnleitn were closed partly or completely as a result of renovatjon work, sales in the resorts overall rose by 2.5 % compared to the previous year, rising to EUR 86.4 million. Considerable increases in sales were recorded in partjcular in the resorts Winterberg, Interlaken, Albufeira, Damnoni and St. Michael. In additjon to the income from exercised rights of residence in 2016, the item “Other sales” includes the book profjt of EUR 11.5 million (net of tax) from the sale of the Chamonix resort.

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At 71.8 %, the occupancy rate at the resorts (previous year: 68.1 %) was well up on the previous year. The Marrakech, Punkaharju, Saalbach, Winterberg, Athens, Prague and Interlaken resorts, in partjcu- lar, recorded relatjvely large increases in their occupancy rates. In fact, the San Agustîn, Marbella, Berlin-Gendarmenmarkt and Lisbon resorts registered occupancy

• f over 90 %.

The number of guests at all resorts rose to 382 153 (previous year: 373 200), an increase of 2.4 %. Travel fmexibility also proved to be an important factor: more and more shareholders and members

• pted to book by the day.

Now let me move on to capital expenditure.

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The volume of capital expenditure rose in 2017 to a total of EUR 62.2 million and can be atuributed to the following positjons: – capital expenditure in new resorts of EUR 19.6 million, basically for the new resort Cavallino. – Hapimag carried out a total of EUR 25.6 million worth of renovatjons on its propertjes (previous year: EUR 12.5 million), partjcularly for La Madrague, Porto Heli and London. – In additjon, EUR 6.0 million was spent on maintenance and repairs at the resorts (previous year: EUR 5.6 million). – Furthermore, EUR 16.7 million was invested in our own new administratjon building in Steinhausen.

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The large volume of investment actjvitjes of EUR 61.1 million net (previous year: EUR 12.6 million) reduced free cash fmow by a total of EUR –27.8 million (previous year: EUR +13.6 million). On the other hand, cash fmow from operatjng actjvitjes improved by EUR 4.3 million to EUR 36.8 million. As a result of the partjal fjnancing of major projects, liquidity shrank to EUR –7.4 million.

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The Hapimag Group’s balance sheet structure remains very solid. Equity increased from EUR 281.6 million to EUR 296.5 million. Internal operatjng resources rose by EUR 2.7 million to a total of EUR 459.5 million. Thus, the high equity ratjo of 47 % (previous year 45 %) and high share of internal operatjng resourc- es contjnue to provide Hapimag with a very solid fjnancial situatjon. As a result, the net asset value per share was up by EUR 31.00 and at the end of 2017 amounted to EUR 2007. Now, before I talk about the annual fjnancial statement of our parent company Hapimag AG, I would like to clarify with the help of a fjgure why the consolidated fjnancial statements of the Group must not be confused with the annual fjnancial statements of the parent company.

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The annual fjnancial statements of the Hapimag Group constjtute consolidated fjnancial statements. As I have already mentjoned, these statements close with a result of EUR 11.1 million. The consolidated fjnancial statements of Hapimag include balance sheet and income statement items for all Hapimag companies. As such, the consolidated fjnancial statements give a true and fair view of the Hapimag Group’s net assets, fjnancial positjon and results of operatjons. One of the companies in the Group is Hapimag AG, in which you as shareholders have a direct equity interest. The resorts owned by Hapimag AG itself, their results and the actjvitjes of the head offjce are to be found in the statutory fjnancial statements of Hapimag AG. The other resorts are owned indirectly through local companies and are thus recognised as invest- ments in the statutory fjnancial statements of Hapimag AG. The statutory fjnancial statements are prepared in accordance with the Swiss Code of Obligatjons. This brief explanatjon can also be found in the Annual Report. I would now like to present to you the annual fjnancial statements of our parent company Hapimag AG.

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The statutory fjnancial statements of Hapimag AG, which refmect only part of the business of the Hapimag Group, are presented in Swiss francs. The annual fjnancial statements of Hapimag AG closed in 2017 with a profjt of CHF +3.9 million. The profjt is broken down as follows: – CHF –2.9 million comes from the valuatjon adjustments on investments and long-term loans to subsidiaries. This was basically atuributable in 2017 to a further depreciatjon in the Turkish lira against the Swiss franc. These adjustments do not impact the consolidated income statement. – The difgerence of CHF 6.8 million results from all actjvitjes of the Swiss resorts, the resorts in the branches in Austria and Portugal and the headquarters in Baar. This positjve result at the parent company is basically the consequence of lower operatjng costs. Our CEO Hassan Kadbi will provide us with further informatjon about business performance last year.

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(words of Hassan Kadbi) Ladies and gentlemen, Shareholders, I would also like to extend a warm welcome to you here at the Waldmannhalle in Baar. At our last Annual General Meetjng a year ago, I introduced myself as the new CEO of Hapimag. Today I will report to you on what we had achieved together last year. But before I do that, I would like to say thank you to you, our dear Hapimag shareholders. I believe that one of today’s most important messages is: Thank you for your loyalty Thank you for your support. And thank you for your trust. Together, we achieved the best annual result in 15 years in 2017. Without you that would not have been possible.

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Let us look back to the last Annual General Meetjng. On that occasion, I presented fjve focal points to you that we fjrst wanted to concentrate on. – Firstly, improving communicatjon with shareholders and members. – Secondly, transferring greater decision-making competence to employees. – Thirdly, optjmising and simplifying procedures and processes. – Fourthly, focusing on online marketjng and online communicatjon. – And fjfuhly, reducing costs. Let us look at where we stand today, with a few examples for each of these fjve points. For point 1:

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We have strengthened communicatjon with shareholders and members this year. Maybe you have notjced that: the 2017 Annual Report has become signifjcantly more voluminous. Hapimag is provid- ing comprehensive and transparent informatjon. In May 2017 the CEO blog was started. In this blog, I provide my personal opinion on certain subjects, mostly topical ones. The blog helps to promote a direct exchange of views. And not least, it helps us to manage Hapimag even more efgectjvely in the interests of our shareholders and members. At present, the CEO blog has 29 000 readers. Many of you provide valuable feedback, suggestjons, and pointers as well as constructjve critjcism. In the comment columns, all opinions are welcome. And the discussions are open, honest and respectgul. I am very happy to see this. As a third example, I would like to include our enhanced communicatjon in all other channels: in 2017, around 220 000 calls were made to the Hapimag Service Points. And about 68 000 e-mail enquiries were answered. We send out regular newsletuers to almost 90 000 subscribers. About 92 000 shareholders and members receive their printed documents electronically on the Booking

• Portal. That is around 9 000 more than last year. I believe we are following a sound path here.

Now to the second focal point: a higher degree of decision-making competence among employees.

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Under this heading we are mainly focusing on “empowerment”. What does that mean? Strictly hier- archical structures have been loosened up. Our managers are highly motjvated, the teams have been re-organised and contribute fresh ideas. Employees have greater authority and personal responsibility. I would like to take this opportunity to extend a big thank-you to all our employees. You are doing a great job. I am proud of you. If you want to achieve more empowerment you can’t just press a butuon and expect everything to fall into place. Changing behaviour and stripping away old habits take tjme. We are not yet where we want to be, but we are steadily making progress. In training and the promotjon of talent, too, we took some large steps forward in 2017. The “Young Generatjon Manager Programme” is one example. This programme helps us set the right course for future managers at the Hapimag resorts. The third focal point was simpler procedures and optjmised processes.

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In 2017 we prepared a number of changes and improvements for our shareholders. We are now progressively implementjng these. It is a matuer of giving priority to your requirements. We set out the changes and improvements at the end of February in an informatjonal brochure entjtled “New services for you”. This includes, for example, integratjng the Booking Portal into the Hapimag website. And the Hapimag website will – gradually – have new functjons added. For instance, the booking of Hapimag holiday apartments will become even easier. I would ask you to give our “new services” a chance. I am aware that change also brings uncertainty. But all change requires tjme and patjence. And it has to start at some point – obviously with good planning and preparatjon. We have done that to the best of our knowledge and belief. Further, we are adhering to a philosophy of “lean management”. We are consistently translatjng this approach into our day-to-day work. We are creatjng an awareness for effjciency in terms of tjme and cost and the reductjon of expenditure. Where it makes sense and is feasible, procedures will be auto- mated and digitalised. Let us move on to the fourth point: focus on online marketjng and online communicatjon.

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Since 2017, we have been targetjng our marketjng communicatjon. We are now working hard to improve this further. We are also spending less money on advertjsements and prospectuses. We are beginning to make betuer use of the opportunitjes ofgered by online marketjng by focusing more on our core target groups. We achieve this by carrying out more focused campaigns that are thus easier to measure. And by measuring our success and learning systematjcally from the results. Let us now come to the fjnal, important point of lower costs.

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Hapimag is concentratjng on its core business. We signifjcantly scaled back expenditure in marketjng last year. IT operatjng costs were likewise reduced. As were stafg costs at the head offjce in general. Since mid-April 2018, all IT systems are being operated in an external data centre. That reduces capital expenditure and less capital is tjed up in IT systems. Through these and other measures we saved a total of EUR 5.2 million at the head offjce in 2017. I would also like to highlight another focal point that is self-evident for us: our service quality. At present, we are maintaining a very high level. Guest satjsfactjon is at 84.5 %, which represents a further increase. We are also delighted to have received 17 HolidayCheck Awards. That is something we should also be proud of. In summary, I can say that we are on the right path. But there is stjll work to do. This year and the next, we will contjnue to concentrate on these focal points.

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In additjon, we will, of course, contjnue to pursue our corporate objectjves in 2018, which are as follows: – retain the existjng 130 000 shareholders and members – generate 3 million overnight stays – enhance the reputatjon and thus the value of the company – focus on core business – make data-based decisions – and not least: optjmise processes and reduce costs Now I would like to report briefmy on what is new with regard to the Resorts Area.

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One of the highlights of 2018 is the opening of the new Hapimag resort Cavallino. The resort has been built from scratch and is situated close to Venice. It will open for business on 28 July. The holi- day apartments have been available to book since the start of this week.

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The Hapimag resort in Porto Heli will be offjcially re-opened on 2 June. Renovatjon of the resort was completed earlier than planned. Everything went well and the costs are below budget. The pre-open- ing phase from 10 May already has very solid bookings.

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Since the end of July 2017, the Hapimag Resort London has been undergoing redevelopment. Given that the building is listed and dates from 1864, the renovatjon is quite demanding. A lot of permits are required and surprising fjnds keep cropping up from behind the walls. That is excitjng in a way, but it also means the work will take longer than planned. We are doing everything possible with all those involved to expedite the constructjon work, with the aim that the Hapimag Resort London will be able to re-open in autumn 2018.

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In additjon to these three major constructjon projects, Hapimag is also implementjng a number of smaller ones. At the Hapimag Resort Ascona, for instance, the swimming pool area is being renovat-

• ed. In Pentolina, the exterior is being cleaned up, in Amsterdam the windows are being renovated

and in Tonda the receptjon area is being redeveloped. And the Hapimag resorts in Meran and Hör- num are to have new Honesty Shops. Pictured is a premium 1-room apartment at the Amsterdam resort.

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Finally, dear Shareholders, I would like to repeat a quotatjon that I read out to you a year ago at the Annual General Meetjng. “All knowledge is in vain save when there is work. And all work is empty save when there is love.” We will contjnue to work with passion for you and for Hapimag. And I promise you that we will give our all to achieve the goals we have set. Thank you very much.

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(words of Giatgen Peder Fontana) I would now like to open the part of the Annual General Meetjng required by the Artjcles of Associ-

• atjon. Before dealing with the matuers required by the Artjcles of Associatjon, I need to note a few

formal points.

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I note that the invitatjon to the Annual General Meetjng was published on schedule in accordance with the Swiss Code of Obligatjons and Artjcle 11 of the Artjcles of Associatjon, and published on 22 March 2018 in the Swiss Commercial Gazetue (Handelsamtsblatu). The Annual General Meetjng was therefore duly convened and the agenda items can be decided on. The minutes of the previous Annual General Meetjng were approved by the Board of Directors at its meetjng on 7 September 2017 and issued to the shareholders, if they so wished. In additjon, the minutes are available to all shareholders in the protected customer area. The Annual General Meetjng will be recorded for the purpose of the minutes. The speakers on the stage and at the speaker’s desk will be video recorded. The sound and video recordings will be used for internal purposes for the minutes and for live streaming. The live stream is available to the public in real tjme for free viewing.

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The minute-taker is Mr Thomas Mainka, General Counsel of Hapimag AG. The minutes will be drawn up in abbreviated resolutjon form in accordance with the requirements of the law and of the Artjcles

• f Associatjon. The Votjng Offjce is being managed by Mr Markus Pally, Head Accounts Switzerland.

I would like to welcome notary Florian Schneider as our Independent Proxy. I would also like to wel- come notary Alexander Eckenstein. A word of welcome, too, to the representatjves of the Auditors KPMG, Ms Nicole Charrière Roos and Mr Martjn Schaad.

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You can see the list of agenda items on the screen.

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Among other things, the list of agenda items includes a replacement electjon to the Board of Direc- tors and amendments to the Artjcles of Associatjon, proposed by the Board of Directors. At this point I would like to inform you that before agenda item 6, we will take a short break of 20 minutes. Startjng at 12.30 p.m., snacks will be available at the back of the hall.

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“Hapimag Ferienclub für Aktjonäre e.V.”, hereinafuer HFA, has proposed amendments to the Artjcles

• f Associatjon and the conductjng of a special audit for this Annual General Meetjng. Our Vice Presi-

dent Stefan Schalch will guide you through agenda item 9 on the special audit. No other shareholder motjons were received to be included as agenda items. We will give you the

• pportunity under the agenda item “Miscellaneous” to given an opinion on topics that are not on

the agenda and are not included in the remit of the Annual General Meetjng per se. We thereby note that the list of agenda items including “Miscellaneous” is closed with ten agenda items.

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Let us now start with agenda item 1: “Approval of the management report, annual accounts and consolidated financial statements for 2017, and acknowledgement of the Auditors’ report” The consolidated fjnancial statements of the Hapimag Group close with a profjt of EUR 11 127 997. The annual accounts of the parent company Hapimag AG (statutory fjnancial statements) show a profjt of CHF 3 887 422. The statutory fjnancial statements of Hapimag AG, which refmect only part

• f the business of the Hapimag Group, are presented in Swiss francs.

In their reports to the Annual General Meetjng, the Auditors KPMG AG recommend that the con- solidated fjnancial statements for 2017 and the annual accounts for 2017 of the parent company Hapimag AG be approved. The Board of Directors wishes to follow this recommendatjon from KPMG and proposes that the management report and the annual and consolidated fjnancial statements for 2017 be approved. Before invitjng requests to speak, we would like to answer the questjons of 20 April 2018 submit- ted in writjng by HFA.

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• 1. Lettjng to non-members/licences
• 2. General terms and conditjons for transfers
• 3. Branches in the euro area
• 4. Expiry of residence rights (residence points)
• 5. Hit list
• 6. Shareholder reports on incorrect calculatjons/erroneous issuing of votjng rights

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• 1. Lettjng to non-members/licences

Excerpt from the CEO blog: “… that at some destjnatjons tourism licences are required to operate a

• resort. It is a conditjon of the licence that utjlisatjon cannot be exclusively for a specifjc community,

but rather the resort must be open to all and external guests cannot simply be refused.” This is the fjrst tjme we have heard of this. HFA questjon: How many destjnatjons does this concern and which ones are they in fact? (answer from Hassan Kadbi) – Hapimag ofgers accommodatjon services and – like all other providers – has to comply with the local requirements and rules. – To operate the resorts we need various offjcial authorisatjons (so-called tourism licences). This may difger according to country and locatjon. – Primarily, our resorts are available to shareholders and members within the framework of the Hapimag holiday concept. – We would like to state precisely that because of local licences, our resorts are available both to shareholders and members as well as to external guests. Hapimag is marketjng some of its holiday apartments to non-members in a targeted and controlled manner. The main aim of this measure is to generate valuable earnings which will in turn reduce costs for shareholders and members. This corresponds with the sustainability practjces implemented within the company, assists in improving the company’s image and helps us to gain new shareholders and members.

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• 2. General terms and conditjons for transfers

At present, Hapimag is forcibly amending the general terms and conditjons (GTC) when shares are transferred to Hapimag Classic, without indicatjng the usual (legally required?) exit or terminatjon

• clause. This gives the impression of not doing business at all seriously. Who, for instance, on fjnding

they have inherited a VW Passat petrol car, actually wants to (be forced to) receive a VW Golf diesel?! HFA questjon: Why is there actually no mentjon of the usual and legally required exit clause when a product is transferred with a difgerent GTC rather than the GTC of the original product? (answer from Hassan Kadbi) A transfer of shares is a matuer covered by private law between Hapimag AG and the shareholder. When the transfer is made, our shareholders have the choice of optjng for the current share-based right-of-residence product. In order to promote transfer to the next generatjon, we ofger new shareholders the most aturactjve, and at the same tjme, the most fmexible terminatjon optjon. The current conditjons for Hapimag Classic make entry into the Hapimag system easier because of the new terminatjon optjon.

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• 3. Branches in the euro area

– In legal terms, Hapimag operates and manages its resorts through subsidiaries in the individual

• countries. Through our lawyer, we raised the following questjon: “Why are two branches in the

euro area included in the accounts for Hapimag AG (CHF)?” (according to the footnote on page 50

• f the 2016 Annual Report, in Austria and Portugal)

– What is the purpose of these branches? – What we were seeking was an adequate explanatjon of the business necessity or advantages of

• this. A very detailed response was given to a specifjc part of the questjon about the legal form,

but no informatjon was given as to “why”. – So, once again: why are at least two branches in the euro area included in the accounts for Hapimag AG, which are prepared in Swiss francs? – Why is there a difgerent structure here as opposed to the other regional companies? – What is it intended to achieve, and what does it achieve? (answer from Stefan Schalch) – The current structure of Hapimag should primarily be explained in historical terms. – Hapimag has existed for more than 50 years. At the beginning of the fjrm’s history, a number of business establishments operated and the resorts were owned by these. For that reason, certain resorts remain the property of Hapimag AG even today. The newest resorts (such as Dresden, Hamburg, Cavallino) have been integrated into the existjng subsidiaries. – In principle, all resorts could be owned indirectly through subsidiaries. However, the resorts stjll currently owned directly by Hapimag AG are not being transferred to subsidiaries for the tjme being for organisatjonal, legal and tax reasons. – As I have mentjoned, the Group’s structure has grown over tjme. In recent years, the management

• f Hapimag has optjmised and simplifjed the Group structure through several mergers within the

Hapimag companies. For example, in recent years, reorganisatjons have been carried out with mergers in Switzerland, Spain, Italy, Portugal and France.

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– We regularly assess and review the legal and tax structure of the Group and monitor the legal and tax regimes in the various countries. Where we see potentjal for optjmisatjon – taking account of all relevant parameters – we will contjnue to optjmise the structure.

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• 4. Expiry of residence rights (residence points)

In 2017 (according to the 2017 Annual Report, p. 21), around 1.73 million points were transferred between the partners. In additjon, did around 2.3 million residence points expire at the end of 2017? HFA questjon: – a) Why is an unrestricted transfer of expiry points (points in the last year of their validity) not permitued in order to reduce the number of expiring points? – b) How many residence rights (residence points) for other products had expired at the end of 2017? (answer from Hassan Kadbi) On questjon a): We would like to answer this questjon on the basis of an excerpt from the letuer of 29 September 2017 to Mr Frank Dorner, representatjve of HFA. – The restrictjon on points transfer is based solely on fjnancial consideratjons. Specifjcally, the pre- mise that the Hapimag business model is based on the clear principle that the degree of utjlisatj-

• n of the accommodatjon by shareholders and members be coupled to their level of investment

(share ownership). – Put simply, this means: “those who invest a great deal in holidays (large number of shares; large points credit per year) must also be able to make correspondingly extensive use of accommodatj-

• n”. These persons have contributed more fjnancially to the constructjon of this accommodatjon

and they pay correspondingly higher annual subscriptjon charges for the wear and tear of the accommodatjon. – In other words, as a member once put it very aptly: “the bowling club buys one share and then buys points on top cheaply and all members of the club go on holiday together”. The degree of utjlisatjon in this case does not correspond to the level of investment and creates a huge imba- lance both between the demand for accommodatjon and the available capacity and between the shareholders and members themselves.

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– It is our objectjve to align needs equally for all shareholders. For instance, a shareholder with more than fjve shares would not be pleased if the additjonal purchase rate were increased and as a result they are lefu with nothing in the high season because they cannot book the resort they want. We expect the “new services” to reduce the level of expiry points. On questjon b): In 2017, for non share-based products, 354 000 points expired.

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• 5. Hit list

For years now, we have been asking for a hit list of the business performance of the individual resorts. We have thus far been refused fjgures and data with the explanatjon that they would merely provide a snapshot. Therefore, in order to enable the providers of the capital of Hapimag AG to evaluate the business situatjon, we hereby once again request a hit list of the business performance of 10 facilitjes with the worst levels of occupancy. What we seek is informatjon on occupancy by shareholders of Hapimag AG within the meaning of Art. 2 of the Artjcles of Associatjon, excluding sales from lettjng to non-mem- bers, as well as the earnings per apartment (GOP). In order to counter the absurd argument about an “irrelevant snapshot”, we now request the fjgures as at 31 December 2014, 31 December 2015, 31 December 2016 and 31 December 2017. (answer from Hassan Kadbi) In order to prevent speculatjon and to safeguard the business interests of Hapimag, these fjgures are not published in detail. In the 2017 Annual Report, the performance of resort sales in the last fjve years from marketjng to third partjes is mentjoned on page 26. In 2017, occupancy from marketjng to non-members accounted for 6.9 % of the total overnight stays (page 22 of the Annual Report). A considerable proportjon of this comes from Bodrum Hotel. In additjon, the occupancy key fjgures for various resorts are shown (pages 19–21).

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• 6. Shareholder reports on incorrect calculatjons/erroneous issuing of votjng rights

Shareholders report to us that in several instances errors have arisen in the allocatjon of votjng rights, whether through incorrect calculatjon or simply erroneous issuing. It has also been reported that in several instances the invitatjon letuers have been sent out with incomplete contents and even votjng forms have apparently been missing. HFA questjon: – How does Hapimag handle the errors? – Are steps taken to ensure that votes and electjons are valid with certainty? (answer from Giatgen Fontana) As at 31 December 2017, we had 107 815 shareholders. An invitatjon was sent to all shareholders who were entjtled to vote at the 2018 AGM. Specifjcally, to all shareholders who were registered in the company’s share register by 5 March 2018. The postjng deadlines for the individual countries were coordinated with the post offjce and so dispatch on tjme was organised accordingly. For instance, invitatjons were sent to Germany on 22 March, and 1 day later to Austria and Switzerland. The printers confjrmed for us in writjng that the invitatjons had been dispatched on tjme. Our Service Point employees are available to receive and answer all questjons and concerns of shareholders and members. A total of 55 shareholders had contacted Hapimag by 13 April 2018 to request duplicates of the votjng forms. This happens if, for example, the shareholder has misplaced or lost the documents. A handful of shareholders also contacted us to ask us to send out the invitatjon and the short-form Annual Report.

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Because the shareholder’s address is printed directly on the votjng form, it is practjcally impossible for an envelope to be sent without the votjng form, since there would actually be no address on the envelope. What might happen, though, is that documents are returned to us with an invalid address. This might happen, for instance, if a shareholder has not notjfjed us of their address in tjme. In such cases, too, the Service Point employees and head offjce try to fjnd an up-to-date address. In our view, the votes and electjons in 2018 are valid. (open to legal actjon) I now call for requests to speak according to the list of speakers. As there are no further requests to speak, we will proceed to the vote. Please pick up your votjng machine for this purpose. If you want to approve the management report, annual accounts and consolidated fjnancial statements for 2017 and the Auditors’ reports, as proposed by the Board of Directors, please press “YES”, otherwise please press “NO” or “ABSTENTION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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Agenda item 1 has been approved. Thank you for your votes.

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We now come to agenda item 2: “Approval of the proposed appropriation of the results of the 2017 annual accounts of Hapimag AG (statutory financial statements)” The Board of Directors proposes to the Annual General Meetjng that the 2017 net profjt of Hapimag AG of CHF 3 887 422 be allocated to voluntary retained earnings. I now call for requests to speak according to the list of speakers. As there are no further requests to speak, I will call for the vote. Please pick up your votjng machine for this purpose. If you want to approve the appropriatjon of the profjt as proposed by the Board of Directors, please press “YES”, otherwise please press “NO” or “ABSTENTION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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Agenda item 2 has been approved. Thank you for your votes.

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We now come to agenda item 3 “Discharge of the members of the Board of Directors”. The Board of Directors proposes that its members be granted discharge for their actjvitjes in 2017. The discharge of each member of the Board of Directors will be voted on separately. I now call for requests to speak for all members of the Board of Directors according to the list of speakers. As there are no further requests to speak, we will proceed to the vote. I would fjrst like to explain a few points. On your votjng machine all members of the Board of Directors appear on two sides. This means you can grant discharge to each person individually. To make it clear, I would like to show you in advance what will then be displayed on your votjng machine.

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If you want to approve the discharge of the members of the Board of Directors as proposed, please press “YES”, otherwise please press “NO” or “ABSTENTION”. Here we will give you a litule more than the 30 seconds to vote. Votjng begins now. I now conclude the votjng. We will wait untjl we have the result available.

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You have therefore granted discharge to all members of the Board of Directors. On behalf of all my colleagues, I would like to thank you, dear shareholders, for the trust in us you have expressed.

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We now come to agenda item 4: “Replacement election to the Board of Directors”. Afuer 16 years on the Board of Directors, Mr Hans Peter König will resign from the Board of Directors at this Annual General Meetjng. I would like to take this opportunity to extend a big thank-you to you, Hans Peter, for your long and valuable contributjon. There are 2 people listed on the agenda to replace Mr König. Only one of these persons will be elec- ted to the Board of Directors. We would like to introduce you to the 2 persons who are standing for the replacement electjon.

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The Board of Directors proposes Mr Andreas Winiarski as the replacement for Mr König. Andreas Winiarski was identjfjed as an ideal candidate in a recruitjng process. His experience in working with digital transformatjon and his focus on new media and technologies match up well with the Board of Directors member profjle we are looking for. As an alternatjve candidate, Hapimag Ferienclub für Aktjonäre, HFA for short, is proposing Ms Anita Ines Bock. The Board of Directors proposes that the Annual General Meetjng reject the candidacy of Anita Ines Bock to become a member of the Board of Directors. The Board of Directors is of the view that Anita Ines Bock does not fulfjl the profjle for this positjon on the Board of Directors. Her specifjc expertjse is an area already covered on the Board of Directors by Philipp Ries. When compared with Andreas Winiarski, she clearly has less in the way of qualifjcatjons and range of experience for the requirements of the task. You received the curricula vitarum of Mr Winiarski and Ms Bock with the invitatjon to this Annual General Meetjng. However, I would like to give the two candidates the opportunity at this point to introduce themselves personally. We will begin with Andreas Winiarski with his personal introductjon. Over to you, Mr Winiarski. (speech from Mr Winiarski) Thank you, Mr Winiarski. And now I would like to ask the HFA candidate, Anita Ines Bock, to introduce herself. Over to you, Ms Bock. (speech from Ms Bock) I now call for requests to speak according to the list of speakers. Before we vote, I would like to give you a bit of informatjon about this electjon. As with agenda item 3 “Discharge of the members of the Board of Directors”, the names of the per- sons standing for electjon will appear on your display. You can cast your vote for each person.

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If just one person achieves an absolute majority, that person is elected. If both persons achieve an absolute majority, the electjon will be decided in a 2nd round. This will be decided by a relatjve majority. If both persons fail to achieve an absolute majority, the electjon will also be decided in a second round by means of a relatjve majority. I now invite you to cast your votes. Please pick up your votjng machine for this purpose. If you want to approve the proposal of the Board of Directors to elect Mr Andreas Winiarski to the Board of Directors, please press “YES” for Mr Winiarski, otherwise please press “NO” or “ABSTEN- TION”. If you wish to approve the proposal of HFA to elect Ms Anita Ines Bock to the Board of Directors, please press “YES” for Ms Bock. If you want to approve the proposal of the Board of Directors NOT to elect Ms Bock to the Board of Directors, please press “NO”. Please vote now. I now conclude the votjng. We will wait untjl we have the results available.

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In summary, we note that an absolute majority requires 34 462 YES votes. I note that Ms Bock has received 32 222 YES votes and Mr Winiarski has received 34 528 YES votes. Thus, Mr Winiarski has achieved an absolute majority and is the only person to do so, so he has been elected to the Board of Directors. Mr Winiarski, do you accept the electjon? (answer from Andreas Winiarski) I declare acceptance of the electjon. I would like to invite Mr Winiarski to say a few words. (thank-you speech from Mr Winiarski)

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We now come to agenda item 5: “Election of the Auditors (KPMG AG, Zurich)” The Board of Directors proposes to elect KPMG AG, Zurich, once again as the Auditors for fjnancial year 2018. The Auditors check the annual accounts and the consolidated fjnancial statements in accordance with the legal provisions. For 2018, KPMG AG has reappointed Nicole Charrière Roos as the senior au- ditor responsible for Hapimag AG. The Board of Directors plans to propose new auditors for electjon to the Annual General Meetjng in 2019. I now call for requests to speak according to the list of speakers. As there are no further requests to speak, I will call for the vote. The proposal made by the Board of Directors to elect KPMG AG as the Auditors for fjnancial year 2018 will be put to the vote. Please pick up your votjng machine again for this purpose. If you agree with the electjon of KPMG AG as the Auditors as proposed by the Board of Directors, please press “YES”, otherwise please press “NO” or “ABSTENTION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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The Auditors have been elected by share capital pursuant to Art. 693 (3) no. 1 of the Swiss Code of Obligatjons. Agenda item 5 has thus been approved. KPMG AG, Zurich, has thus been entrusted with the audit for 2018 as well. I wish Ms Nicole Charrière Roos as senior auditor much success in her task.

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I hereby bring our break to a close and come to agenda item 6: “Amendment of the Articles of Association – relocation of the registered office” The Board of Directors proposes to the Annual General Meetjng an amendment to the Artjcles of Associatjon for the purpose of relocatjng the company’s registered offjce to the new administratjon building in Steinhausen, Canton Zug. The detail of the proposed amendment to the Artjcles of Asso- ciatjon can be seen on the screen. In the lefu-hand column you can see the current Artjcles of Associ- atjon, and in the right-hand column the proposed amendment. The amendments are highlighted in colour. Please note that if this agenda item is rejected the registered offjce will remain in Baar. Although the move to Steinhausen is ensured, costs would be incurred as a result of a redirectjon order with the post offjce. I would therefore ask you to be aware of this consequence. I now call for requests to speak according to the list of speakers. As there are no further requests to speak, I will call for the vote. Please pick up your votjng machine for this purpose. According to Art. 704 (1) of the Swiss Code of Obligatjons, the relocatjon of a company’s registered

• ffjce requires a resolutjon of the Annual General Meetjng that receives at least two-thirds of the

votes represented and an absolute majority of the nominal value of shares represented. If you want to approve the amendment to the Artjcles of Associatjon to relocate the registered offjce as proposed by the Board of Directors, please press “YES”, otherwise please press “NO” or “ABSTEN- TION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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You have accepted the amendment to the Artjcles of Associatjon to relocate the registered offjce. I would like to thank you, dear Shareholders, for your approval.

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Let us now come to agenda item 7: “Other amendments to the Articles of Association proposed by the Board of Directors” You will be votjng on a total of 4 proposed amendments. We begin with agenda item 7.1 “Creatjon of an audit advisory board as a body”.

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The Board of Directors proposes to the Annual General Meetjng that the Artjcles of Associatjon be amended for the purpose of creatjng an audit advisory board as a new body. The detail of the proposed amendment to the Artjcles of Associatjon can be seen on the screen. There are changes to Artjcle 8 of the Artjcles of Associatjon.

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And a new artjcle is created. Here is the explanatjon from the Board of Directors: The plan is to create a legally regulated audit advisory board as a formal body elected by the Annual General Meetjng as an additjon to the statuto- ry bodies (Annual General Meetjng, Board of Directors and Auditors). The competences of the audit advisory board are to be described and allocated in regulatjons to be writuen with due regard to the competences of the Annual General Meetjng pursuant to Art. 689 (2) of the Swiss Code of Obliga- tjons, to the non-transferable and irrevocable functjons of the Board of Directors defjned in Art. 716a

• f the Swiss Code of Obligatjons and to the functjons of the Auditors as set out in Art. 728 fg. of the

Swiss Code of Obligatjons. I now call for requests to speak according to the list of speakers. As there are no further requests to speak, I will call for the vote. Please pick up your votjng machine for this purpose. If you want to approve the amendment to the Artjcles of Associatjon “Creatjon of an audit advisory board as a body” as proposed by the Board of Directors, please press “YES”, otherwise please press “NO” or “ABSTENTION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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You have approved the amendment to the Artjcles of Associatjon “Creatjon of an audit advisory board as a body”. Thank for your approval. The Board of Directors will decide on the regulatjons and the requirement profjle for the audit advisory board at its Corporate Governance meetjng this summer in order then to actjvate the votjng procedure for the 2019 resolutjon.

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We come now to agenda item 7.2 “Election of the President of the Board of Directors by the Annual General Meeting”. The Board of Directors proposes to the Annual General Meetjng that the President of the Board of Directors should now be elected by the Annual General Meetjng. This is in line with the wishes of many shareholders. The Board of Directors acknowledges the importance of this matuer. The detail of the proposed amendment to the Artjcles of Associatjon can be seen on the screen. There are changes to Artjcle 8 of the Artjcles of Associatjon and changes to Artjcle 17.

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I now call for requests to speak according to the list of speakers. As there are no further requests to speak, I will call for the vote. Please pick up your votjng machine for this purpose. If you want to approve the amendment to the Artjcles of Associatjon “Electjon of the President of the Board of Directors by the Annual General Meetjng” as proposed by the Board of Directors, please press “YES”, otherwise please press “NO” or “ABSTENTION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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You have approved the amendment to the Artjcles of Associatjon “Electjon of the President of the Board of Directors by the Annual General Meetjng”. Thank for your approval. We will notjfy the amendment to the Artjcles of Associatjon to the commercial register offjce and – if the latuer has no objectjons – the next electjon of the President of the Board of Directors will be by the Annual General Meetjng.

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We come next to agenda item 7.3 “Term and re-electjon limits for members of the Board of Directors”. The Board of Directors proposes to the Annual General Meetjng that the term of offjce and re-elec- tjon of members of the Board of Directors be limited. The Board of Directors believes that limitjng the maximum term of offjce is essentjal for the sustainable growth of Hapimag. The detail of the proposed amendment to Artjcle 18 of the Artjcles of Associatjon can be seen on the screen. I now call for requests to speak according to the list of speakers. As there are no further requests to speak, I will call for the vote. Please pick up your votjng machine for this purpose. If you want to approve the amendment to the Artjcles of Associatjon “Term and re-electjon limits for members of the Board of Directors” as pro- posed by the Board of Directors, please press “YES”, otherwise please press “NO” or “ABSTENTION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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You have approved the amendment to the Artjcles of Associatjon “Term and re-electjon limits for members of the Board of Directors”. Thank for your approval. We will notjfy the amendment to the Artjcles of Associatjon to the commercial register offjce and – if we get the go-ahead – we will then implement it.

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We come now to agenda item 7.4 “Change to the wording of Artjcle 24”. The Board of Directors proposes to the Annual General Meetjng the following changes to Artjcle 24

• f the Artjcles of Associatjon (deletjon of “delegates” and “directors”).

Pursuant to the current Corporate Governance guidelines, the Board of Directors proposes to ap- prove this change to the text of the artjcle. The detail of the proposed amendment to Artjcle 24 of the Artjcles of Associatjon can once again be seen on the screen. I now call for requests to speak according to the list of speakers. As there are no further requests to speak, I will call for the vote. Please pick up your votjng machine for this purpose. If you want to approve the amendment to the Artjcles of Associatjon “Change to the wording of Artjcle 24” as proposed by the Board of Directors, please press “YES”, otherwise please press “NO” or “ABSTENTION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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You have approved the amendment to the Artjcles of Associatjon “Change to the wording of Artjcle 24”. Thank for your approval.

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We come now to agenda item 8 “Proposal of HFA – Hapimag Ferienclub für Aktjonäre e.V. to amend the Artjcles of Associatjon”. You will be votjng on a total of six proposed amendments. The Board of Directors recommends rejectjng all six proposed amendments. We will give you the explanatjon from the Board of Directors for each agenda item.

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We begin with agenda item 8.1 “Amendment of the Company’s objectjve”. HFA proposes the amendment to Artjcle 2 of the Artjcles of Associatjon shown on the screen. The word “primarily” is to be deleted. Here is the explanatjon from the Board of Directors: The Board of Directors strongly holds the view that the facilitjes of Hapimag AG should be enjoyed by those who fjnance them. This forms the basis of the unique Hapimag concept. As of 31 December 2017, 107 815 shareholders and 20 724 members fjnanced the facilitjes by buying products. Never- theless, the Board of Directors believes that limitjng the company objectjves so that only sharehold- ers can use the facilitjes of Hapimag AG would be counter-productjve, and even harmful, as it would prevent the Board of Directors and the Executjve Board from managing the Hapimag facilitjes fmexibly and effjciently. The use of lettjngs to non-members (marketjng to third partjes) is clearly set out in the Booking Informatjon. Lettjng to non-members also helps to gain new cus- tomers and generated additjonal sales of EUR 6.6 million for Hapimag in 2017 in resorts and during periods with very low occupancy by shareholders and members. Shareholders and members have had and will contjnue to have priority. This has already been enshrined in the Artjcles of Associatjon. For these reasons, the Board of Directors proposes that the amendment to the Artjcles of Associatjon be rejected. I now call for requests to speak according to the list of speakers. As there are no further requests to speak, I will call for the vote. Please pick up your votjng machine for this purpose. According to Art. 704 (1) of the Swiss Code of Obligatjons, amendment of the company’s objectjve requires a resolutjon of the Annual General Meetjng that receives at least two-thirds of the votes represented and an absolute majority of the nominal value of shares represented. If you want to reject the amendment to the Artjcles of Associatjon “Amendment of the Company’s

• bjectjve” as proposed by the Board of Directors, please press “NO”, otherwise please press “YES” or

“ABSTENTION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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You have rejected the amendment to the Artjcles of Associatjon “Amendment of the Company’s

• bjectjve”. Thank you for approving the proposal of the Board of Directors.

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We come to agenda item 8.2 “Informatjon to shareholders regarding products and general terms and conditjons”. HFA proposes the amendment to Artjcle 4 of the Artjcles of Associatjon shown on the screen. Here is the explanatjon from the Board of Directors: When Hapimag shares are purchased, the person acquiring the shares receives a complete infor- matjon package that provides detailed informatjon on the products and services. If any changes are made to products and services, every shareholder afgected by the change is duly informed. In the case of questjons or uncertaintjes, Hapimag customer services are available to shareholders at any tjme. Shareholders can access their product details at any tjme

• nline in the secure customer area. Providing the same informatjon automatjcally every year to all

shareholders does not generate any added value, but it does create costs for Hapimag. For these reasons, the Board of Directors proposes that the amendment to the Artjcles of Associatjon be rejected. I now call for requests to speak according to the list of speakers. As there are no further requests to speak, I will call for the vote. Please pick up your votjng machine for this purpose. If you want to reject the amendment to the Artjcles of Associatjon “Informatjon to shareholders regarding products and general terms and con- ditjons” as proposed by the Board of Directors, please press “NO”, otherwise please press “YES” or “ABSTENTION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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You have rejected the amendment to the Artjcles of Associatjon “Informatjon to shareholders regard- ing products and general terms and conditjons”. Thank you for approving the proposal of the Board

• f Directors.

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We move on to agenda item 8.3 “Transfer of shares under the same terms as the original purchase” HFA proposes the amendment to Artjcle 5 of the Artjcles of Associatjon shown on the screen. Here is the explanatjon from the Board of Directors: Hapimag has existed for more than 50 years. During this tjme, the leisure market has undergone dramatjc change, and it will contjnue to do so. The company must therefore have the optjon to adapt the conditjons of holiday rights to the new conditjons whenever there is a change of shareholders at the least. For these reasons, the Board of Directors proposes that the amendment to the Artjcles of Associatjon be rejected. I now call for requests to speak according to the list of speakers. As there are no further requests to speak, I will call for the vote. Please pick up your votjng machine for this purpose. If you want to reject the amendment to the Ar- tjcles of Associatjon “Transfer of shares under the same terms as the original purchase” as proposed by the Board of Directors, please press “NO”, otherwise please press “YES” or “ABSTENTION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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You have approved the amendment to the Artjcles of Associatjon “Transfer of shares under the same terms as the original purchase”. The Board of Directors acknowledges this decision of the Annual General Meetjng. Hapimag will notjfy the amendment to the Artjcles of Associatjon to the commercial register offjce and, if the latuer has no objectjons, will then implement it.

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We move on to agenda item 8.4 “Amendment to the content and publicatjon of the minutes of the Annual General Meetjng”. HFA proposes the amendment to Artjcle 16 of the Artjcles of Associatjon shown on the screen. Here is the explanatjon from the Board of Directors: The law already states that all requests for informatjon and the answers provided are to be recorded in the minutes of the Annual General Meetjng. Hapimag has always handled the matuer in this way. An amendment of the Artjcles of Associatjon is therefore not required. Following each Annual Gen- eral Meetjng, the minutes can be viewed by the Hapimag shareholders and members in the personal customer area and they are sent to them by post on request. For these reasons, the Board of Directors proposes that the amendment to the Artjcles of Associatjon be rejected. I now call for requests to speak according to the list of speakers. As there are no further requests to speak, I will call for the vote. Please pick up your votjng machine for this purpose. If you want to reject the amendment to the Artj- cles of Associatjon “Amendment to the content and publicatjon of the minutes of the Annual General Meetjng” as proposed by the Board of Directors, please press “NO”, otherwise please press “YES” or “ABSTENTION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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You have rejected the amendment to the Artjcles of Associatjon “Amendment to the content and publicatjon of the minutes of the Annual General Meetjng”. Thank you for approving the proposal of the Board of Directors.

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We come to agenda item 8.5 “Re-electjon and term limits for members of the Board of Directors”. HFA proposes amending Artjcle 18 of the Artjcles of Associatjon. Here is the explanatjon from the Board of Directors: The Board of Directors has already proposed under agenda item 7.3 a restrictjon to the term of offjce to two years and a maximum number of six terms of offjce. You have already approved this agenda

• item. So under this present agenda item we will just vote on the additjonal clause “For proposals for

electjon to the Board of Directors, adequate account shall be taken of the natjonality of the share- holders”. The Board of Directors moves that this additjon be rejected, as considering the natjonalitjes restricts the circle of possible candidates, which is not desirable for the long-term growth of Hapimag. I now call for requests to speak according to the list of speakers. As there are no further requests to speak, I will call for the vote. Please pick up your votjng machine for this purpose. If you want to reject the amendment to the Ar- tjcles of Associatjon “Re-electjon and term limits for members of the Board of Directors” as proposed by the Board of Directors, please press “NO”, otherwise please press “YES” or “ABSTENTION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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You have rejected the amendment to the Artjcles of Associatjon “Re-electjon and term limits for members of the Board of Directors” with respect to the additjonal clause regarding the consideratjon

• f natjonalitjes. Thank you for approving the proposal of the Board of Directors.

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We move on to agenda item 8.6 “Re-electjon limits for the Auditors”. HFA proposes the amendment to Artjcle 25 of the Artjcles of Associatjon shown on the screen. Here is the explanatjon from the Board of Directors: KPMG AG has been the auditor for Hapimag for many years and is therefore very familiar with Hapimag’s special characteristjcs. There is no need to place restrictjons on re-electjons for the auditor at non stock exchange-quoted companies, as by law the chief auditor may not have this mandate for more than seven years. For these reasons, the Board of Directors proposes that the amendment to the Artjcles of Associatjon be rejected. I now call for requests to speak according to the list of speakers. As there are no further requests to speak, I will call for the vote. Please pick up your votjng machine for this purpose. If you want to reject the amendment to the Artj- cles of Associatjon “Re-electjon limits for the Auditors” as proposed by the Board of Directors, please press “NO”, otherwise please press “YES” or “ABSTENTION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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You have approved the amendment to the Artjcles of Associatjon “Re-electjon limits for the Audi- tors”. The Board of Directors acknowledges this decision of the Annual General Meetjng. We thereby conclude agenda item 8. For agenda item 9 “Conduct of a special audit” I would like to Stefan Schalch to take the fmoor. Over to you, Stefan.

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(words of Stefan Schalch) So we come to agenda item 9 “Conduct of a special audit”. HFA has proposed to the Annual General Meetjng that a special audit as per Art. 697a fg. of the Code

• f Obligatjons be conducted, dealing with three matuers. HFA has submitued a wide range of ques-

tjons in this regard. Later – yet not untjl 5 April 2018 in a letuer – HFA sent us further questjons for a special audit. For reasons of tjme we were unable to include these questjons in the invitatjon and submit them to shareholders. We will therefore proceed in two stages. – In the fjrst part, we will deal with and vote on the questjons for the special audit included in the agenda and submitued to all shareholders. – In the second part, we will deal with the HFA questjons not included in the agenda and submitued to shareholders, and about which shareholders were unable to express an opinion beforehand, and we will then have a vote on these. Allow me fjrst of all to make an administratjve note: I would ask you to read for yourselves the mat- ters and questjons shown on the screen. I am not going to read them out. We begin with the fjrst set of questjons from HFA, which we were able to submit to all shareholders with the invitatjon. First I would like to ask the proposer HFA if they would like to explain their motjon orally. (oral explanatjon from HFA) Next steps: – We will now answer the questjons from HFA. – Then we will invite requests to speak. – Afuer that we will proceed to the vote on the fjrst part.

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To answer the questjons we will begin with the fjrst matuer. There are three issues here: – changes in the equity recognised on the balance sheet – changes in the share value – changes in the reserves The situatjon to which the fjrst matuer relates was published in the invitatjon to the Annual General Meetjng and corresponds word for word to the proposer’s text. The invitatjon to the Annual General Meetjng was sent to all shareholders. There is therefore no need to set out the matuer once again. We can move straight on to answering the questjons. We come to the fjrst matuer – changes in the equity recognised on the balance sheet:

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Questjon 1.1. What are the real reasons for this steep decline in equity? Allow me to make some preliminary remarks on this: The questjon implies that Hapimag has hitherto not indicated the real reasons. That is wrong. Hapimag has on various occasions and consistently indicated the actual reasons for why Hapimag’s consolidated equity has declined in recent years. We set out the reasons for this reductjon in the letuers – of 6 April 2017 (page 2 – positjon on point 2: change in equity) and –

• f 25 September 2017 (page 5 – positjon on point B: accounts) to Hans-Jacob Heitz.

In additjon, the change in consolidated equity is shown each year in the consolidated annual ac-

• counts. In the 2017 Annual Report, for example, the change in equity can be found on page 30. In this

statement the change is set out for each equity positjon. And now to the answer. So we repeat once more the transactjons that have afgected consolidated equity over the last 11 years: – the sale and repurchase of shares (incl. take-back of loans, the call optjons to buy back Hapimag shares and the capital reductjon in 2015): EUR –21 million – currency translatjon adjustments: EUR –69 million – consolidated result (annual profjt or loss in the consolidated income statement): EUR –5 million – Total: EUR –95 million So currency translatjon adjustments are a key factor. These are atuributable to the movement in the euro and the Turkish lira against the Swiss franc.

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These were temporary adjustments as at the reportjng date which arose because of two factors: – fjrstly, the conversion of the annual accounts of all Group companies prepared in a foreign currency into the currency of presentatjon, the euro – secondly, the valuatjon as at the reportjng date of long-term loans granted to subsidiaries

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Questjon 1.2. What is the correct explanatjon for the obviously implausible difgerence between the share capital recognised on the balance sheet and the share capital as per the Artjcles of Associa- tjon? Two preliminary remarks need to be made here. The statement that it is an implausible difgerence has to be countered fjrst of all. On the contrary, it is easy to explain why the share capital converted to CHF at the current exchange rate does not corre- spond to the share capital in EUR recognised on the balance sheet. We explained this in detail in the letuers of 6 April (page 3 – positjon on point 3: change in share capi- tal) and of 25 September 2017 (page 4 – positjon on point B: accounts ) to Hans-Jacob Heitz. Now to the answer: The share capital according to the Artjcles of Associatjon of CHF 41.67 million is shown on the Hapimag AG balance sheet on page 59 in the 2017 Annual Report. However, since 2008 these consolidated annual accounts (consolidated fjnancial statements) have been prepared in the currency of presentatjon, EUR. The equity is shown at historical rates, i.e. the transactjon was converted at that day’s rate and not changed thereafuer (see accountjng policies for the consolidated fjnancial statements on page 33 of the 2017 Annual Report, sectjon on currency translatjon). When switching the currency of presenta- tjon as at 1 January 2008 from CHF to EUR, the share capital at the tjme of CHF 47.9 million had to be converted into EUR at that day’s rate of 1.6573. The result was share capital of EUR 28.902 million. In 2015, the share capital of Hapimag AG was reduced by CHF 6.23 million to CHF 41.67 million on the basis of an AGM resolutjon. This reductjon of CHF 6.23 million then had to be converted to EUR at the then current daily rate of 1.0477. Thus, in 2015 the share capital of EUR 28.902 million was reduced by EUR 5.946 million to EUR 22.956 million.

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Result: the difgerence between the share capital recognised on the balance sheet and the share capital shown in the Artjcles of Associatjon is thus plausible, transparent and explicable on the basis

• f the informatjon available to all shareholders.

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Questjon 1.3. What is the explanatjon for the substantjal drop in value of Hapimag shares? Preliminary remark: It is not true to say that the shares have sufgered a substantjal drop in value. Answer: The net asset value per share corresponds to the amount of internal operatjng resources (I) divided by the number of shares in circulatjon. If the internal operatjng resources increase, the net asset value rises in linear fashion if the number

• f shares in circulatjon stays the same, and if they decrease there is a similar linear drop.

The net asset value is based on the consolidated balance sheet and so it is shown in EUR. Since 2008, the consolidated balance sheet has been prepared in EUR. The table displayed shows a slightly fmuctuatjng net asset value per share. The average net asset value over the last 14 years is EUR 2028. The current net asset value of EUR 2007 is thus one per cent below the long-term average value.

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Questjon 1.4. What is the actual value of Hapimag shares today? The net asset value per share in circulatjon as at 31 December 2017 was EUR 2007. I invite you to read this fjgure in the 2017 Annual Report on page 26.

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Questjon 1.5. How have the reserves changed over the last 5 years? Does Hapimag stjll have fjnan- cial reserves? If yes, how much? The consolidated capital reserves as at 31 December 2017 were EUR 373.5 million and can be seen in the consolidated balance sheet in the 2017 Annual Report on page 28. The change in consolidated capital reserves can be seen on the slide displayed. The fjgures come from the available annual reports (2013 Annual Report page 10, 2014 Annual Report page 12, 2015 Annual Report page 10, 2016 Annual Report page 10 and 2017 Annual Report page 28). In 2015 there was a capital reductjon of 35 250 shares pursuant to an Annual General Meetjng reso- lutjon, which explains the drop in capital reserves in that year. For an overall view, consolidated equity needs to be considered. You cannot just look at capital re- serves in isolatjon. We had already set out the issue of consolidated equity in detail in questjon 1.1.

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We come now to the second matuer: accountjng. We have already discussed this issue today in agen- da item 1. The situatjon to which the second matuer relates was published in the invitatjon to the Annual Gene- ral Meetjng and corresponds word for word to the proposer’s text. The invitatjon to the Annual General Meetjng was sent to all shareholders. There is therefore no need to set out the matuer once again. We can move straight on to answering the questjons. Questjon 2.1. Is the accountjng based on the so-called consolidated fjnancial statements, with the Annual General Meetjng having a formal vote on both the consolidated fjnancial statements and the fjnancial statements for Hapimag AG in one throw, in conformity with the law? The statutory fjnancial statements and the consolidated annual accounts are linked to each other. If one set of accounts is not accepted by the Annual General Meetjng, that also afgects the other one. Though separatjng them into two votes would be possible, to our knowledge it never happens in practjce, at least in large companies. With regard to this questjon, we looked through the lists of agenda items of listed companies: they regularly vote on both sets of accounts in one step. This procedure is without doubt in conformity with the law.

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Questjon 2.2. Is it legally permissible that, as part of the votjng procedure, the fjrst agenda item concerns the consolidated fjnancial statements and the next agenda item concerns only the use of the annual result, i.e. it does not concern the annual accounts including the balance sheet of the parent company Hapimag AG? This questjon coincides with the previous questjon. Yes, the procedure is legally permissible.

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Questjon 2.3. What plausible explanatjon is there for the contradictory annual results, with the consolidated fjnancial statements consistently showing positjve annual results, and the consist- ently large losses at the parent company, Hapimag AG? Preliminary remark: It needs to be made clear fjrst of all that the annual results in the accounts for the Group and for Hapimag AG are not contradictory. On the contrary, it is plausible that the annual result in the consolidated fjnancial statements does not correspond to the annual result for Hapimag AG. Our CFO has already set the fjgures out for you today. In the letuers of – 6 April 2017: page 1 – positjon on point 1: lack of transparency in Hapimag consolidated fjnancial statements/balance sheet and – 17 April 2017: page 2 – positjon on the point: concerns about losses, to Hans-Jacob Heitz We explained the difgerences between the consolidated fjnancial statements and the annual fjnancial statements of Hapimag AG and why each of the difgerences result. Answer: We are happy to explain again why the annual results in the consolidated fjnancial statements have difgered from the annual results of Hapimag AG over recent years. The statutory fjnancial statements of Hapimag AG include only the resorts (branches) owned directly by Hapimag AG and their results (Portugal, Austria, Switzerland, Finland) and the actjvitjes of head

• ffjce.

All other resorts are owned indirectly through local companies. These companies are recognised as investments in the statutory fjnancial statements of Hapimag AG. The statutory fjnancial statements are prepared in accordance with the Swiss Code of Obligatjons.

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The consolidated fjnancial statements of Hapimag include balance sheet and income statement items for all Hapimag companies. The consolidated fjnancial statements are prepared in accordance with the recommendatjons on accountjng (Swiss GAAP FER). Because of the depreciatjon of the euro and the Turkish lira against the Swiss franc and the introduc- tjon of individual valuatjons for investments resultjng from an amendment to the Swiss Code of Ob- ligatjons, between 2010 and 2015 large valuatjon adjustments on investments and long-term loans to subsidiaries, impactjng the income statement, were necessary at Hapimag AG (statutory fjnancial statements). The investments shown on the balance sheet in the statutory fjnancial statements are replaced in the consolidated fjnancial statements by assets and liabilitjes of subsidiaries. Therefore, these valuatjon adjustments are not in the consolidated fjnancial statements. Afuer eliminatjon of all intra-Group relatjons, the fjnancial positjon and performance is presented as if the Group were a single company. This procedure is also referred to as consolidatjon (see consolida- tjon principles in the 2017 Annual Report on page 33). Under consolidatjon, in the consolidated fjnancial statements currency translatjon adjustments are recognised without impact on the income statement in other reserves as part of equity. The currency translatjon adjustments are only recognised with an impact on the income statement if the Group company in questjon is deconsolidated (see sectjon on currency translatjon in the 2017 Annual Re- port on page 33).

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Questjon 2.4. How, where and for what reason within the Group have there been substantjal losses in the double-digit millions at Hapimag AG for years? Preliminary remark: We answered the questjon of how, where and for what reason the losses at Hapimag AG arose under questjon 2.3. Nonetheless I would like to show you once again – in graphic form – why valuatjon adjustments had to be booked at Hapimag AG. For this purpose, we will use the content of the graph that was pub- lished in the documents sent to all shareholders for the AGMs in 2012 to 2014. I quote from the 2012 Annual Report, Note 15, page 56: “Because of the new accountjng legislatjon entering into force as at 1 January 2013, from fjnancial year 2015 (transitjonal period) investments in subsidiaries will have to be measured individually. Hapimag has decided to move progressively towards this change in accountjng startjng from 2011.” [end of quotatjon] Answer: I will explain the matuer again using the same diagram. The capital invested in Swiss francs in the subsidiaries (investments) over the last 50 years was higher than the current equity of the subsidiaries, calculatjng back into Swiss francs as at the reportjng date. Therefore in recent years up to and including 2016, considerable valuatjon adjustments had to be booked at Hapimag AG.

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The following example shows this clearly: – Hapimag invested CHF 200 000 historically in a subsidiary. At the exchange rate at the tjme, this corresponded to EUR 130 000. Accordingly, at the parent company this CHF 200 000 was included in the balance sheet as an investment, while at the subsidiary, the equivalent value of EUR 130 000 EUR was included in the balance sheet as equity. – Now exchange rate fmuctuatjons occur. At the lowest relevant EUR/CHF exchange rate to date the EUR 130 000 has a value of only CHF 140 000. Therefore, Hapimag AG is forced to make a valuatjon adjustment for the CHF 60 000 impactjng the income statement. Irrespectjve of this legally required valuatjon, the resorts retain their utjlity value in full.

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Questjon 2.5. Is it in conformity with the law that there was no disclosure to shareholders about the annual accounts of the 25 subsidiaries and an associatjon (2016 annual report, page 46) con- trolled by Hapimag AG? Preliminary remark: The Hapimag shareholders have their equity interest in Hapimag and have no right to informatjon with respect to the subsidiaries and no right to inspect the annual accounts of the subsidiaries. This was decided by the Swiss Federal Supreme Court in 2005. The consolidated annual accounts assume the task of informing shareholders about the whole Group. However, the Board of Directors also issues informatjon if and insofar as there is a specifjc need for informatjon. But the disclosure of all annual accounts of the subsidiaries is not envisaged by the law. So the answer is: Yes, the procedure is in conformity with the law.

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Questjon 2.6. Do the accountjng practjces of the Board of Directors meet the principles of a true and fair view in accountjng? Preliminary remark: According to the audit report from KPMG AG, the annual fjnancial statements of Hapimag AG are in line with Swiss law and the Artjcles of Associatjon. According to the audit report from KPMG AG, the consolidated annual accounts (consolidated fjnan- cial statements) are in line with Swiss law and the accountjng recommendatjons (Swiss GAAP FER in 2017 and prior to that IFRS). So the answer is: Answer: Yes, the accountjng meets the principles referred to.

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Questjon 2.7. Is it not true that the consolidated fjnancial statements are a means of manipulatjng the actual annual results (losses in the double-digit millions at Hapimag AG)? Preliminary remark: It is a reputatjon-damaging insinuatjon that the losses at Hapimag AG are manipulated in the consoli- dated fjnancial statements. Your assertjon is not correct. Answer: As mentjoned under questjon 2.6, the fjnancial statements of Hapimag are in accordance with the law and the Artjcles of Associatjon. These are audited and confjrmed each year by an independent and reputable audit fjrm. As mentjoned under questjon 2.3, there are no valuatjon adjustments for investments and long-term loans to subsidiaries in the consolidated fjnancial statements because the investments, with the capi- tal recognised at historical values, are consolidated (eliminated) and replaced by assets and liabilitjes

• f subsidiaries.

Under consolidatjon, in the consolidated fjnancial statements currency translatjon adjustments are recognised without impact on the income statement in other reserves as part of equity. The currency translatjon adjustment is only recognised in the income statement if the Group compa- ny concerned is deconsolidated. I invite you once again to read the accountjng policies. These are set out in detail each year in the Annual Report (2017 Annual Report, page 33).

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Questjon 2.8. Is it in conformity with the law that the auditor did not think it worth including, in its audit report on Hapimag AG, a special note on the uninterrupted substantjal losses over the years in the double-digit millions? Yes, it is in conformity with the law. The wording of the audit reports is regulated in the applicable audit standards. A standard wording is used. Changes are only made to this standard wording if:

• 1. a breach of the law is found,
• 2. contjnuatjon of the business within the next 12 months is jeopardised,
• 3. a capital loss or excessive debt is found,
• 4. the annual accounts contain material errors.

The mere fact that a company makes losses over several fjnancial years does not, when the applica- ble audit standards are applied, lead to a modifjcatjon of the audit report.

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We come now the third matuer: discrepancies in resort sales/purchases The situatjon to which the third matuer relates was published in the invitatjon to the Annual General Meetjng and corresponds word for word to the proposer’s text. The invitatjon to the Annual General Meetjng was sent to all shareholders. There is therefore no need to set out the matuer once again. We can move straight on to answering the questjons. Questjon 3.1. Who at Hapimag was involved in the sale or purchase of the resorts named above? Preliminary remark: This questjon was answered in the letuer of 25 September 2017 (page 6) to Hans Jacob Heitz. Answer: However, we are happy to answer the questjon again. The persons in charge of the resort sales and purchases mentjoned by you changed over tjme. While earlier it was mainly the legal advisor and secretary to the Board of Directors who took the lead, this role later switched to the Chief Real Estate Offjcer and the Head of Property Management. In general the following applies: – The Board of Directors approved all sales and purchases. – It delegated executjon to the Executjve Board in line with the Organisatjon Regulatjons. – Following approval by the Board of Directors, the transactjon was executed by the Executjve Board and the relevant internal units.

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Questjon 3.2. What is the correct detailed accountjng result for each resort that was sold? Preliminary remark: – The results for the sales (2015 to 2017) were presented at the 2017 AGM. – The results on the resorts additjonally enquired about were also provided to Hans-Jacob Heitz in the letuer of 9 October 2017 (page 1). Answer: The table displayed shows the accountjng for the resorts sold. In our opinion, further comment on the individual positjons is unnecessary.

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Questjon 3.3. What price (such as book value?) formed the basis for the sale or for settjng the sales price for each resort, and what principles were used to calculate this price? Preliminary remark: We explained the reasons for a sale at the last Annual General Meetjng. Answer: I will be happy to set them out again. The operatjonal and business reasons that led to the sale of the last resort were: – low and falling occupancy – structurally negatjve contributjon to total comprehensive income/loss and a charge to the income statement – renovatjons required and not justjfjed from an economic point of view The sales price is defjnitjvely determined by the market. – The sales price for resort sales is based on supply and demand. – Independent appraisals can provide further indicatjons of a possible sales price. – The defjnitjve sales price is fjnally negotjated with prospectjve buyers before the purchase con- tract is then drawn up and signed.

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Questjon 3.4. According to Mr Kurt Scholl, a member of the Board of Directors, independent appraisals were carried out. Who conducted these appraisals, what value per resort was calcula- ted, and what valuatjon method was used? Can any of these appraisals be viewed? Such appraisals are produced by external real estate experts. They are based on traditjonal valuatjon methods, in partjcular the discounted cash fmow method

• fuen used in practjce.

Appraisals and relevant documentatjon are intended for internal use and are not published.

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Questjon 3.5. How were the purchases of the two resorts mentjoned above fjnanced? What was taken into consideratjon when determining the purchase price? You are talking about the resorts in Marrakech and in Cavallino. – We fjnanced the Marrakech resort from current cash fmow in 2007. This was a facility under con-

• structjon. The total capital expenditure calculatjon justjfjed the purchase and completjon of the

resort. – The Cavallino resort is being fjnanced from current cash fmow and bank credits. As at 31 December 2017, the total credit lines of the Hapimag Group amount to EUR 68 million, of which as at the reportjng date only EUR 26 million has been drawn down (see 2017 Annual Report, page 49). In Cavallino, a piece of land with planning permission right on the beach was bought. The purchase price for the piece of land in Cavallino was infmuenced by two key factors: – An approved building project was already in place that met the requirements of Hapimag. – The property is in a top locatjon right on the beach (Venice region). It is known that in Italy the administratjve hurdles are very high when it comes to building a resort and doing so in a reasonable tjme frame. Thus, this building project was a unique opportunity to be able to build a resort quickly and right on the beach in Italy. The two factors mentjoned were thus important components of the price negotjatjon.

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Questjon 3.6. What was the budget for building the new Cavallino resort and how much was billed? Were constructjon costs kept within budget? The capital expenditure amount approved by the Board of Directors for the Cavallino resort is EUR 67.8 million. The expected total capital expenditure amount for the project is EUR 67.0 million. We expect the constructjon costs to be kept within budget.

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Questjon 3.7. With respect to the two buildings of the “Kanzelhöhe” resort sold by Hapimag for EUR 5 million, why is it that, according to the notary records, the buyer AGK GmbH resold one of the buildings to Infjnity Gerl GmbH for EUR 4.5 million around one week prior to the contractually certjfjed sale? Preliminary remark: You asked the same questjon, Mr Heitz, in your letuer of 18 March 2017. We replied to you in our letuer of 6 April 2017 (pages 3 and 4). Answer: The reasons leading to the sale have been set out in answer to questjon 3.3. The aim of the Board

• f Directors was to sell the entjre Kanzelhöhe resort (buildings 1 and 2) because it was only causing

vacancy costs and at the same tjme was constantly losing value. The companies AGK GmbH and Infjnity Gerl. GmbH presented themselves to Hapimag as joint buyers, though the negotjatjons were conducted only with AGK GmbH. The fjnancing of the entjre transactjon went through Infjnity Gerl. GmbH, which was why a separate purchase contract had to be concluded between AGK GmbH and Infjnity Gerl. GmbH to setule the transactjon, so that AGK GmbH would be able to pay Hapimag the required purchase price. At the tjme of the resale from AGK GmbH to Infjnity Gerl. GmbH, there was already a binding declaratjon of intent to buy between Hapimag AG and AGK GmbH, and for that reason the signing of the purchase contract between AGK GmbH and Infjnity Gerl. GmbH was a prior confjrmatjon for Hapimag that AGK GmbH would adhere to its intentjon to buy.

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Questjon 3.8. Why did Hapimag not sell directly to Infjnity Gerl GmbH, since the Board of Directors must have known about the resale? Who benefjted from the clear difgerence between the sales price and the resale price? Infjnity Gerl. GmbH was only interested in buying building 2. Without having AGK GmbH as the buyer

• f building 1 (as a pure hotel operatjon) it would not have been possible for Hapimag to sell the facil-

ity as a whole. AGK GmbH as the buyer of the facility resold building 2 to Infjnity Gerl. GmbH and so at fjrst glance made a profjt on this transactjon. However, we do not have the informatjon to judge whether that was actually the case. Equally, we are unable to answer the questjon as to who might have benefjted from this transactjon. For Hapimag, in any case, the entjre transactjon was very advantageous. The Board of Directors, by the way, was not involved in executjng the transactjon, as explained previ-

• usly under questjon 3.1.

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Questjon 3.9. With regard to the sale of the “Chamonix” resort, can you explain the clear difger- ence between the sales price of some EUR 20 million and the resale proceeds generated by the buyer averaging EUR 250 000 per apartment, totalling around EUR 60 million? Preliminary remark: You asked the same questjon, Mr Heitz, in your letuer of 18 March 2017. We replied to you in our letuer of 6 April 2017 (page 4). Answer: A comparison between the purchase price and an extrapolatjon on the basis of speculatjon about individual holiday apartment prices in advertjsements is not permissible. – Firstly, the publicly touted purchase price does not have to correspond to reality; indeed, it is pret- ty safe to assume that the prices actually paid are lower; and – secondly, the extrapolatjon does not include the high renovatjon, development and sales costs (headcount, marketjng, agent commissions, etc.) of the property developer. Indeed, in the case of Chamonix, the property developer had to invest an amount in the double-digit millions to renovate and develop the facility into a luxury property. The property development business is risky and speculatjve. Hapimag’s business model is not aimed at using the capital provided by shareholder/members to invest in propertjes in order to subsequently resell them – with no guarantee of a sale. Hapimag is not a property developer, nor does it have the costly sales set-up for the sale of individual holiday apartments.

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Questjon 3.10. How does this compare with the actual occupancy fjgures of each resort? Is the op- eratjng result of each resort suffjcient to cover costs? Are there any expensive renovatjons coming up? On the questjon of occupancy: – In the 2017 Annual Report on page 26, we set out the total occupancy over the opening tjmes for each group over the last fjve years. – The total occupancy was made up of the true occupancy rates for each individual resort. On the questjon regarding the operatjng result per resort: – The operatjng result of the Resorts division in fjnancial year 2017 was EUR 9.4 million and is shown in the 2017 Annual Report on page 53 in the divisional accountjng. – Hapimag has a portgolio of 57 resorts of varying size, locatjon and complexity of constructjon. This means that shareholders and members have access to a varied range of holiday optjons. Some resorts produce a negatjve operatjng result. On the questjon of renovatjons coming up: – As mentjoned in our writuen response of 6 April 2017 (page 4) to Hans-Jacob Heitz, we repeat that the Board of Directors has a capital investment plan. – This is reviewed annually by the Board of Directors as part of the annual budget and the business plan (for a period of 5 years) and adjusted if necessary. – Annual renovatjons and maintenance actjvity are planned and implemented for each resort. – There are no redevelopments planned but renovatjon and improvement work is. – Over the last 10 years, we have invested EUR 25.9 million a year on average in renovatjon and improvement: a total of EUR 259 million.

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Questjon 3.11. Did these resort sales have any impact on equity? If so, to what extent? What efgect does this have on the share capital and the value/development of the Hapimag share? The fjrst part of the questjon is similar to questjon 3.2.: the net results from the resort sales were – and here we are repeatjng ourselves – included in the consolidated income statement in the year of the

• sale. Accordingly, the consolidated equity changed by these amounts.

The resort sales had no efgect on the share capital. It would be impossible for them to have any efgect. The share capital changes only if there are capital increases or capital reductjons. However, the resort sales did afgect the net asset value per share precisely because consolidated equity changed as a result of the resort sales. The resort sales listed under your questjon 3.2. had a total positjve efgect on Hapimag’s equity of EUR 12 million.

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Dear Shareholders, We have now worked through all three matuers in the fjrst part and answered the questjons in detail. I now call for requests to speak according to the list of speakers. As there are no further requests to speak, we will proceed to the vote. Allow me fjrst of all to give you a short declaratjon from the Board of Directors: The Board of Directors has – as set out in detail previously – answered many questjons from HFA several tjmes in – discussions with representatjves of HFA, – in letuers to the representatjves of HFA and – at Annual General Meetjngs. In this respect, the Board of Directors refers you to the document placed in the protected customer area called “Correspondence between Hapimag and the legal representatjve of shareholder associa- tjon ‘Hapimag Ferienclub für Aktjonäre HFA’”, which can be accessed at www.hapimag.com/correspondence-agm. It should also be noted that questjons relatjng to valuatjons and legal compliance would not be inves- tjgated by a special auditor and therefore not be covered by a special audit. For these reasons – and in consideratjon of the detailed answers given again today to the questjons from HFA – in the view of the Board of Directors, there is no need for a special audit. Such an audit would ofger no additjonal fjndings, but instead would incur unnecessary high costs (we are talking about at least several CHF 100 000) for Hapimag and thereby for shareholders and mem- bers. For these reasons, the Board of Directors moves that the proposal to conduct a special audit be rejected entjrely.

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Before we proceed to the vote, I would therefore like to ask HFA whether they actually stjll wish to have a vote on a special audit and, if so, if that applies in full. I acknowledge that HFA stjll wishes to have a vote. Please pick up your votjng machine for this purpose. If you want to reject the conduct of a special audit on the questjons just discussed and as set out in the invitatjon to the Annual General Meetjng, as proposed by the Board of Directors, please press “NO”, otherwise please press “YES” or “ABSTENTION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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The quorum for votjng on the conduct of a special audit is based on share capital pursuant to Art. 693 (3) no. 3 of the Swiss Code of Obligatjons. You have approved the performance of a special audit. The Board of Directors acknowledges this decision. As for the next steps: – The appointment of one or more special auditors is a matuer for the court. The shareholders and Hapimag AG may now apply to the court for appointment of a special auditor (Art. 697a (2) Code

• f Obligatjons).

– The court will then decide whether the questjons raised and which of these questjons will be sub- mitued to a special auditor for clarifjcatjon.

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As mentjoned at the beginning of this agenda item, we now come to the second part of the ques- tjons for the special audit. These matuers and questjons, which are not on the agenda, were submitued by HFA in a letuer of 5 April 2018. First of all I would like to ask the proposer (HFA) if they would like to explain their motjon orally. (explanatjon from HFA) Next steps: – We will now answer the questjons from HFA. – Then we will invite requests to speak. – Afuer that we will proceed to the vote on the second part. There are again several matuers to discuss. We will again answer the questjons individually. We will begin with the answers to the fjrst matuer. Our numbering is based on the numbering used in the letuer from HFA.

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This matuer is about valuatjon adjustments. The situatjon to which this matuer relates was described by the proposer as follows. “The considerable valuatjon adjustments on investments totalling around CHF 7 million according to the annual fjnancial statements of Hapimag AG are striking (2017 Annual Report, p. 60 and notes on

• p. 63, point 2.10). Within the space of just two years (see also: 2016 Annual Report p. 52 and p. 55

point 2.10, omittjng any explanatjon), the investments were corrected by CHF 31 million! It should be noted that it is these 2017 valuatjon adjustments alone, besides other unreal income (see below), that make the annual profjt recorded possible. The explanatjon in terms of currency fmuctuatjons (EUR to CHF > 31.12.15: 1.0875/31.12.16: 1.0722/ 31.12.17: 1.169) does not sound very plausible; there is also a lack of transparency in the repeated reference to the subsidiaries (2017 Annual Report, p. 54), the annual fjnancial statements of which are not accessible to shareholders, which is not satjsfactory.”

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Issue of “valuatjon adjustments” Questjon 1.1 a) What actually are the real reasons for the changes in the valuatjon adjustments positjon; are these fjnancial statement correctjons required for accountjng reasons – if so, what is the explanatjon? Answers: As set out in the 2017 Annual Report, page 63 in Note 2.10, valuatjon adjustments result, fjrstly, because of the results of the subsidiaries and, secondly, because of exchange rate fmuctuatjons. The investments are measured at the rate applying on the reportjng date. Valuatjon adjustments for unrealised losses are recognised with due account taken of the principle of prudence (Art. 960 of the Code of Obligatjons) and of the principle of imparity (Art. 960a of the Code

• f Obligatjons), although any subsequent reversals of impairments arising from unrealised profjts

from an impaired investment are not recognised. Further informatjon will be provided in a moment in answer to the next questjon.

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Issue of “valuatjon adjustments” Questjon 1.1 b) In fjnancial years 2016 and 2017, to what extent was the actual efgect of the currency fmuctuatjons

• f signifjcance, viewed in objectjve terms?

As set out at the 2017 Annual General Meetjng (for 2016) and on the previous slide, the valuatjon adjustments on investments and long-term loans to subsidiaries in 2016 were CHF –9.615 million This was atuributable chiefmy to the 17 % depreciatjon of the Turkish lira and the UK pound against the Swiss franc. In fjnancial year 2017, a further valuatjon adjustment of CHF 2.88 million was caused mainly by a renewed depreciatjon of the Turkish lira of 12 % against the Swiss franc. The fjgures mentjoned can be found in the 2017 Annual Report, page 63, Note 2.10.

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Issue of “valuatjon adjustments” Questjon 1.1 c) What were the accountjng results from 2007 to 2017 for each individual Group company/subsidi- ary of the Hapimag Group and for the resorts owned directly by Hapimag AG? As happens in practjce and is usual in general for group companies, so at Hapimag the accountjng results for the individual Group companies/subsidiaries are not shown separately. The Hapimag shareholders have their equity interest in Hapimag and have no right to informatjon with respect to the subsidiaries and no right to inspect the annual accounts of the subsidiaries. This was decided by the Swiss Federal Supreme Court in 2005. The consolidated annual accounts assume the task of informing shareholders about the whole Group. However, the Board of Directors also issues informatjon if and insofar as there is a specifjc need for informatjon. But the disclosure of all annual accounts of the subsidiaries is not envisaged by the law. We gave this answer to questjon 2.5 in part 1. With respect to the resort results, we also refer you to our answer in part 1, questjon 3.10 on the special audit. Hapimag does not publish individual resort results.

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We come now to the next topic, which is the fjnancial structure of the resorts owned: The situatjon to which this matuer relates was described by the proposer as follows. “According to the 2017 Annual Report, p. 25, the resorts in Portugal, Austria, Switzerland and Finland are owned directly by Hapimag AG, while all others, according to the list in the 2017 Annual Report,

• p. 54, are (wholly) owned indirectly through Group companies, which means that the annual results
• f the resorts for each country feed into the annual accounts in two difgerent ways, as well as in two

currencies (CHF/ EUR), which is not exactly conducive to transparency and the requirement for clarity in accountjng. Apart from the levels of occupancy for the resorts owned in general, the report does not provide individual details of the operatjng results for the resorts owned directly by Hapimag. The division by countries comes across as random.”

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Issue of the “fjnancial structure of the resorts owned“ Questjon 1.2 a) The resorts in Portugal, Austria, Switzerland and Finland are owned directly by Hapimag AG. The other resorts are owned indirectly through local companies. What are the actual reasons for this division? b) What sort of legal and/or fjnancial circumstances explain this division? c) Are there key tax reasons, for instance? So does this division make sense in tax terms? d) Is this division actually necessary/plausible when looked at objectjvely? e) What are the individual operatjng results for the resorts owned by Hapimag? The current structure of Hapimag is primarily to be explained in historical terms. I explained this using the same words for agenda item 1: Hapimag has existed for 55 years. At the beginning of the fjrm’s history, a number of business estab- lishments operated and the resorts were owned by these. For that reason, certain resorts remain the property of Hapimag AG even today. The newest resorts (such as Dresden, Hamburg, Cavallino) have been integrated into the existjng subsidiaries. In principle, all resorts could be owned indirectly through subsidiaries. However, the resorts stjll cur- rently owned directly by Hapimag AG are not being transferred to subsidiaries for the tjme being for

• rganisatjonal, legal and tax reasons.

As I have mentjoned, the Group’s structure has grown over tjme. In recent years, the management

• f Hapimag has optjmised and simplifjed the Group structure through several mergers within the

Hapimag companies.

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For example, in recent years, reorganisatjons have been carried out with mergers in Switzerland, Spain, Italy, Portugal and France. We regularly assess and review the legal and tax structure of the Group and monitor the legal and tax regimes in the various countries. Where we see potentjal for optjmisatjon – taking account of all relevant parameters – we will contjnue to optjmise the structure. With regard to your last questjon e): As has been explained several tjmes, in order to prevent specu- latjon and to safeguard Hapimag’s business interests, we do not disclose the individual results for the resorts.

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We come to the next topic, the sale of resorts: The situatjon to which this matuer relates was described by the proposer as follows: “In the reportjng years 2016 and 2017, resorts such as Bad Kleinkirchheim and Chamonix and the Group company Svenska Hapimag AB were sold (2017 Annual Report, botuom of p. 39).”

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Issue of “sale of resorts” Questjon 1.3 Questjon: To what extent did the sale of the resorts Bad Kleinkirchheim and Chamonix and the Group company Svenska Hapimag AB, as a result of the sales proceeds, afgect the 2016 and 2017 annual fjnancial results and the actual operatjng results as unreal operatjng income/exceptjonal items? This questjon was answered at the last Annual General Meetjng. Here is a table showing an excerpt from the presentatjon to the 2017 Annual General Meetjng. The sales transactjons mentjoned only afgected the consolidated result in fjnancial year 2016, with an efgect of EUR 4.9 million, and had no efgect on the fjnancial year 2017.

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We come to the next topic, the Bodrum resort: The situatjon to which this matuer relates was described by the proposer as follows: “There is an irrefutable assumptjon that the resort/hotel in Bodrum has had poor visitor numbers for years, partly as a result of the unfavourable environmental conditjons brought about by politjcal fac- tors, which the 2017 Annual Report (p. 21) confjrms with an entjrely unsatjsfactory occupancy level

• f 31 %. According to the Hapimag website, a discount of 25 % is ofgered at Bodrum.”

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Issue of the “Bodrum resort” Questjon 2.1 a) How will occupancy at the Bodrum resort/hotel develop in the future? Here we begin by quotjng from the 2017 Annual Report: “Afuer a challenging year, the Bodrum resort posted an increase in occupancy. But at 31 % (previous year: 30 %), it is stjll one of the least popular resorts in the Sun & Sea category. The politjcal situatjon contjnues to have an impact on booking behaviour.” [end of quotatjon] What the future in Turkey will look like is diffjcult to assess. Politjcal uncertainty contjnues to prevail. Opinions difger greatly. In its editjon of 16 April 2018 (page 18), the NZZ newspaper cited a well-known Swiss tour operator who claimed that “destjnatjons in Turkey are being booked almost three tjmes as ofuen compared to the previous year”. However, current reservatjons for Bodrum are unfortunately only slightly higher compared to the previous year.

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Issue of the “Bodrum resort” Questjon 2.1 b) What are the motjvatjons for the discount of 25 %? Does this resort stjll pay at such a discount? Does it not in fact give rise to sustained losses? The pricing is a result of supply and demand. A discount is used to enhance occupancy. In 2017, the aim of this measure was to generate additjonal occupancy that made a contributjon to covering fjxed costs. Such measures and similar ones serve explicitly to achieve a betuer performance for poorly occupied resorts.

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Issue of the “Bodrum resort” Questjon 2.1 c) What were the operatjng costs and the earnings in Bodrum in 2016 and 2017? Thanks to higher occupancy and strict cost control, the operatjng result for both 2016 and 2017 was improved in comparison to 2015. However, it is unfortunately not yet satjsfactory.

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Issue of the “Bodrum resort” Questjon 2.1 d) What sort of consequences does the currency loss in the Turkish lira have? Was account taken of this in the annual accounts/balance sheet? If so, to what extent? In the annual fjnancial statements of Hapimag AG in 2017, another valuatjon adjustment was under- taken on the Turkish subsidiary investment because of the depreciatjon of the Turkish lira against the Swiss franc (–18 %) (see 2017 Annual Report, page 63, Note 2.10). In preparing the consolidated fjnancial statements, the annual accounts of the Turkish subsidiary are converted from Turkish lira to the presentatjon currency, EUR. This conversion takes place at the clos- ing rate. Assets and liabilitjes are converted at the rate on the reportjng date (2017: 1 EUR = TRY 0.2211). Income and expenditure are converted at the average rate for the year (2017: 1 EUR = TRY 0.2437). Equity, on the other hand, is recognised at historical rates. The difgerences from this con- version are recognised in equity and are presented as currency translatjon adjustments under Other reserves in equity (2017 Annual Report, page 44, Note 20).

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Issue of the “Bodrum resort” Questjon 2.1 e) Is the Board of Directors considering disposing of the Bodrum resort? The occupancy situatjon and operatjonal fjgures form part of the monthly reportjng to the Board of Directors. The Bodrum resort is by far Hapimag’s largest resort. Small fmuctuatjons in occupancy are felt fjnanci- ally at Group level immediately. Within the framework of its current strategy, the Board of Directors does not intend to sell the Bo- drum resort.

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Issue of the “Bodrum resort” Questjon 2.1 f) What was the acquisitjon value in CHF/EUR? What is the current carrying amount in CHF/EUR? What is the assumed market price in CHF/EUR? In order to prevent speculatjon and to safeguard the business interests of Hapimag, these fjgures are not published. In additjon, we do not know the market value of the resort.

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We come now to the next topic, the value of the individual resorts and the requirement in the Artjcles of Associatjon regarding their mortgage debt. The situatjon to which this matuer relates was described by the proposer as follows: “According to Art. 29 of the Artjcles of Associatjon, each resort can only be mortgaged up to a maxi- mum of 20 % of the acquisitjon value. Allegedly, this limit has not been adhered to in the case of the administratjon centre.”

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Issue of “all resorts and administratjon centre: requirement for mortgage debt” Questjon 2.2 a) What are the acquisitjon value and carrying amount for each individual resort? In order to prevent speculatjon and to safeguard the business interests of Hapimag, the acquisitjon value and carrying amount for each resort are not published. This has been pointed out on several occasions (most recently, see the 2017 AGM minutes, page 9).

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Questjon 2.2 b) Are there resorts at present for which the mortgage debt is more than 20 % of the actual acquisi- tjon value? Preliminary remark: Contrary to your assertjon, the Artjcles of Associatjon do not envisage that each resort can only be mortgaged up to a maximum of 20 % of the acquisitjon value. Art. 29 of the Artjcles of Associatjon stjpulates that the mortgage debt of the propertjes altogether must not be higher than 20 %. Artjcle 29 of the Hapimag Artjcles of Associatjon reads as follows: “Real estate owned by the Com- pany and its subsidiaries can only be mortgaged up to a maximum of 20 % of the acquisitjon costs of the propertjes.” This has always been handled this way and adhered to. Thus, an individual resort may be mortgaged for more than 20 % of its acquisitjon value. Answer: Yes, the resorts that currently have mortgage debt and the new administratjon building are each mortgaged for more than 20 % of their acquisitjon value.

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Questjon 2.2 c) What is the positjon regarding the 20 % limit for all resorts with mortgage debt measured by carrying amount and assumed market value? What is relevant – as has just been mentjoned – are the assets mortgaged in relatjon to the total acquisitjon value. The acquisitjon value as at 31 December 2017 is EUR 1.123 billion. The mortgage debt as at 31 December 2017 is EUR 94.4 million (see 2017 Annual Report, page 48, Note 38). So the ratjo is 8.4 %. That is well below the 20 % limit stjpulated in the Artjcles of Associatjon. In relatjon to the book value (= EUR 587.7 million as at 31 December 2017) the mortgage debt is 16.1 % . The ratjo “mortgage debt in relatjon to assumed market value” is not calculated. Nor is it possible, as the “assumed market value” is a hypothetjcal value.

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Questjon 2.2 d) What is the fjgure for the mortgage for the administratjon centre measured by its acquisitjon value? The expected total costs for the offjce building will be around EUR 34 million. The new offjce building is secured by a mortgage in the amount of CHF 35 million.

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We come now to the questjons about the 2017 Annual report: The situatjon to which this matuer relates was described by the proposer as follows. “According to the 2017 Annual Report, profjt has now surprisingly been recorded for Hapimag AG as well, and an alleged increase in equity has been shown. This seems odd given the previous decline, especially as the President of the Board of Directors started talking about a turnaround at the 2016 AGM, in the context of the 2016 annual accounts showing a loss of > CHF 17 million for Hapimag AG; the special audit being called for at the tjme is likely to have been one of the motjvatjons. It is known that there are many (legal) optjons for manipulatjng accounts in a way that may be legal but is

• bscure for shareholders. The developments within just one year in the (consolidated) operatjng

income for the Hapimag Group in 2016 are in themselves notjceable: 2016: EUR 297 000 / 2017: EUR 11 128 000; i.e. a balance of just under 11 million; and for Hapimag AG: 2016: –17 278 000 / 2017: CHF 3 887 422 i.e. a balance of around 21 million, as well as the resultjng improvement in

• equity. Of interest in this connectjon are the valuatjon adjustments addressed previously in sectjon

1.1 and the resort sales as unreal operatjng income/exceptjonal items mentjoned in sectjon 1.3. The uncommented- –4 % reductjon in the non-current-assets-to-equity ratjo (2017 Annual Report, p. 25) is worrying. The cash drain of EUR 27.8 million afuer positjve cash fmow being shown for years (previ-

• us year EUR 13.6 million, i.e. a ”cash fmow difgerence” within just one year of EUR 41.4 million) is

notjceable.”

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Issue of “equity” Questjon 3.1 a) What is the actual explanatjon in detail, in the context of the previous downward spiral, for the consolidated annual result [correct: operatjng income] of EUR 12.9 million or [correct: annual profjt] CHF 3.887 million, i.e. what companies, such as Hapimag AG and/or Group companies and resorts owned directly by Hapimag AG contributed to what actual extent and on the basis of what specifjc circumstances?” Preliminary remark: We have taken the liberty of indicatjng the correct terms in red and in brackets. This is to make things precisely correct for the minutes. Answer: When the management report was presented, the reasons for the achievement of the positjve oper- atjng result in the Group and of the annual profjt at Hapimag AG were given. There is nothing more to add here.

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Questjon 3.1 b) What is the actual explanatjon for the turnaround in equity afuer the marked decline on record for the past 10 years up to 2016? Is it real/sustainable? On page 30 of the 2017 Annual Report, the positjve change in consolidated equity is set out per posi- tjon. In additjon to the consolidated result of EUR +11.1 million, a positjve change in currency translatjon adjustments of EUR +8 million was booked which was atuributable mainly to the appreciatjon in the euro, the presentatjon currency, compared to the Swiss franc. Consolidated equity rose accordingly. On the basis of current forecasts and if the exchange rate remains stable, we also expect a positjve change in equity for 2018.

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Questjon 3.1 c) What would equity be without the above-mentjoned (sectjons 1.1. and 1.3) and any other unreal

• peratjng income/extraordinary items invisible to shareholders?

The efgects mentjoned above (sectjon 1.1) have no efgect on consolidated equity. On the basis of the accountjng policies, neither the consolidated annual accounts nor the 2017 annu- al accounts include so-called extraordinary and non-operatjonal results. The efgects mentjoned under 1.3 have already been set out in the answer to questjon 1.3: the sales transactjons mentjoned afgected the consolidated result in fjnancial year 2016, with an efgect of EUR 4.9 million, and had no efgect on the fjnancial year 2017.

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Questjon 3.1 d) What is the explanatjon in detail for the cash drain? Where, i.e. at what companies, such as Hapimag AG and/or Group companies, did this occur and for what reasons? The change in consolidated cash fmow is shown in detail on page 31 of the 2017 Annual Report and is presented here on the slide in summary form. – From its operatjng actjvitjes Hapimag recorded a cash infmow of EUR 36.7 million. – Capital expenditure amounted to EUR 61.1 million. There was thus a negatjve free cash fmow of EUR 27.8 million, because more was invested in fjnancial year 2017 than was received in cash infmows.

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Questjon 3.1 e) How is the “contradictjon” between the additjon to equity recorded and the decline by –4 % in the non-current-assets-to-equity ratjo to be reconciled? The fall in the non-current-assets-to-equity ratjo by 4 % is explained as follows on the basis of the fjgures in the 2017 Annual Report on page 27: In comparison to the previous year non-current assets rose by 3 %. On the other hand, internal operatjng resources (II) dropped by 2 %. This results in a fall in the non-current-assets-to-equity ratjo of 4 %.

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Questjon 3.1 f) Does the interim result for the fjrst quarter of 2018 enable conclusions to be drawn as to the sus- tainability of the turnaround? The current fjgures confjrm the positjve trend both in sales and in current reservatjons. The measures taken to improve the cost structure and our concentratjon on core business are of a lastjng nature.

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We now come to the last topic: “liquidity/fjnancial liabilitjes“ The situatjon to which this matuer relates was described by the proposer as follows: “According to the Annual Report, p. 27, liquidity dropped within one year, from previously positjve numbers to a negatjve fjgure, i.e. new debt as a result of an outglow of liquidity of 28 million (alleg- edly because of the constructjon of the administratjon centre). In additjon, current fjnancial liabilitjes (2017 Annual Report, p. 28 and p. 40, sectjon 9) rose markedly.”

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Issue of “liquidity/fjnancial liabilitjes“ Questjon 3.2 a) Does the unfavourable development that has occurred in liquidity, with new debt of EUR 7.437 million and fjnancial liabilitjes of EUR 8.588 million, represent an operatjonal necessity? Because of the focused external fjnancing of the new administratjon building and the partjal external fjnancing of Cavallino, as at the reportjng date 31 December 2017 we recorded fjnancial liabilitjes amountjng to EUR 25.7 million (current: EUR 8.6 million and non-current: EUR 17.1 million). In the past, capital investment plans have been fjnanced with bridging loans. Now two major projects have been started at the same tjme, which are partly being fjnanced with the use of loan capital. Hapimag is aware of this development and is monitoring it regularly.

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Questjon 3.2 b) What are the plans for reducing the new debt and current fjnancial liabilitjes? The current strategy is set down in an internal document covering a period of fjve years. The docu- ment is reviewed at the annual strategy meetjng of the Board of Directors and revised if necessary. In view of the interest rates prevailing on the fjnancial market, a long-term fjnancial strategy is pre- ferred and implemented. The current fjnancial premises are based on the assumptjon that resources freed up by the cost re- ductjons carried out can be used to repay fjnancial liabilitjes.

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Dear Shareholders, We have now answered the HFA questjons for a special audit that were not included in the agenda. I now call for requests to speak. Are there requests to speak for this part? For part 2 of the special audit, too, the Board of Directors proposes rejectjng the motjon for the con- duct of a special audit. The reasons are the same as for part 1: new fjndings are not to be expected, while very high costs for Hapimag and thus for shareholders and members are to be expected. Before we proceed to the vote, I would therefore like to ask HFA here too whether they actually stjll wish to have a vote on the special audit part 2 and, if so, if that applies in full. I acknowledge that HFA stjll wishes to have a vote. So we come to the vote on these proposals that were not included in the agenda and for which there are therefore no instructjons. Please pick up your votjng machine for this purpose. If you want to reject the performance of a special audit on the questjons just discussed and as set out in the HFA letuer of 5 April 2018, as proposed by the Board of Directors, please press “NO”, otherwise please press “YES” or “ABSTENTION”. Please vote now. I now conclude the votjng. We will wait untjl we have the result available.

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The quorum for votjng on the conduct of a special audit is based on share capital pursuant to

• Art. 693 (3) no. 3 of the Swiss Code of Obligatjons.

You do not wish to subject the additjonal questjons submitued to a special audit. Thank you for approving the proposal of the Board of Directors. It is thus now in the hands of HFA to decide whether they nonetheless wish to apply to the court for a special audit on these questjons. The Board of Directors would oppose such an applicatjon in the knowledge that the Annual General Meetjng rejected this proposal. For the last point in our Annual General Meetjng, I would like to hand over again to Giatgen Peder

• Fontana. Over to you, Giatgen.

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(Giatgen Fontana) The last point in our Annual General Meetjng is entjtled “Miscellaneous”. We will give you the oppor- tunity under this point to give an opinion on topics that are not on the agenda and are not included in the remit of the Annual General Meetjng per se. I now call for requests to speak according to the list of speakers. Dear Shareholders, that was the last address today. I note that all agenda items have been worked through and hereby close the 54th Annual General Meetjng of Hapimag AG.

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I would like to thank you for your lively partjcipatjon and at the same tjme to thank our Hapimag employees for their hard work in preparing and carrying out this Annual General Meetjng. Please leave your votjng machine on your chair. They will be collected later. I would like to say good- bye to you on behalf of the Board of Directors and to thank you for your wide support. I wish you all a safe journey home. Goodbye.