Axfood

Registration and notification

Shareholders who wish to participate in the proceedings of the AGM must:

• be registered as shareholders in the register of shareholders produced by Euroclear Sweden AB as of Tuesday, 11 March 2025, and
• notify the Company in accordance with the instructions under the heading "Participation at the AGM venue" or alternatively submit a postal vote in accordance with the instructions under the heading "Postal voting" no later than Thursday, 13 March 2025.

To be entitled to participate in the AGM, a shareholder who has had their shares registered in the name of a nominee must, in addition to notifying the Company of their participation in the AGM, have the shares registered in their own name in the register of shareholders by the record date of Tuesday, 11 March 2025. Such registration may be temporary (so-called voting rights registration). The registration is to be requested in advance from the nominee, in accordance with the nominee's procedures, at such time as the nominee determines. Voting rights registrations carried out by the nominee no later than Thursday, 13 March 2025 will be considered in the production of the register of shareholders.

Participation at the AGM venue

Shareholders who wish to participate at the AGM venue must notify the Company of this no later than Thursday, 13 March 2025. The notification can be submitted in any of the following ways:

• by mail to Computershare AB, reference "Axfood AGM", Gustav III:s Boulevard 34, 169 73 Solna, Sweden,
• by phone at +46 (0) 771 24 64 00 on weekdays between 9:00 a.m. and 4:00 p.m.,
• by e-mail to proxy@computershare.se, or
• by using the link on Axfood's website: www.axfood.com.

The notification must include the shareholder's name and personal identity number or corporate registration number, address, telephone number, and the number of any assistants (a maximum of two) accompanying the shareholder.

Shareholders who participate via proxy must issue a written and dated power of attorney for the proxy. The representative of a legal entity must present a copy of the registration certificate or equivalent authorisation documents that show the authorised signatory. The shareholder should send the authorisation documents (power of attorney and/or registration certificate) to Computershare AB (who administrate the AGM) at the mail address above in due time before the AGM. Proxy forms can be downloaded from Axfood's website: www.axfood.com.

Postal voting

Shareholders who wish to participate in the AGM by postal voting must submit their postal votes so that their postal vote is received by Computershare AB no later than Thursday, 13 March 2025. A special form shall be used for postal voting. The completed and signed form may be submitted either by email to proxy@computershare.se or mail to Computershare AB, reference "Axfood AGM", Gustav III:s Boulevard 34, 169 73 Solna, Sweden. Shareholders may also submit postal votes electronically through verification via BankID by the link on Axfood's website. Shareholders may not include special instructions or terms with the postal vote. Should this be done, the entire postal vote will be rendered invalid. Further instructions and terms are included on the postal voting form, which is available on Axfood's website: www.axfood.com.

If a shareholder submits their postal vote through a proxy, a written and dated power of attorney signed by the shareholder should be attached to the postal voting form. Power of attorney forms can be downloaded from Axfood's website: www.axfood.com. If the shareholder is a legal entity, a certificate of registration or equivalent authorisation document must be attached to the form.

Shareholders who wish to participate at the AGM venue, either in person or through a proxy, must notify the Company in accordance with the instructions under the heading "Participation at the AGM venue" above. This means that notification through postal voting alone is not sufficient for shareholders who wish to participate at the AGM venue.

Proposed agenda

1. Election of Chairman of the AGM.
2. Preparation and approval of the voting list.
3. Approval of the agenda.
4. Election of one or two persons to verify the minutes of the AGM.
5. Determination of whether the AGM has been duly convened.
6. Presentation of the Annual and Sustainability Report and Auditor's Report, the Consolidated Accounts and the Auditor's Report over the Consolidated Accounts and Auditor's Limited Assurance Report over the Sustainability Statement for 2024.
7. Presentation by the Chief Executive Officer and questions from shareholders.
8. Resolution on the adoption of the Income Statement and Balance Sheet, and the Consolidated Income Statement and Consolidated Balance Sheet.
9. Resolution on the discharge from liability of the Board directors and the Chief Executive Officers.
10. Resolution on the disposition of the Company's profit in accordance with the adopted Balance Sheet, and the record dates for payment of the dividend.
11. Resolution on approval of the Board's Remuneration Report.
12. Determination of the number of Board Directors and Deputy Directors.
13. Determination of the renumeration of the Board and the Auditor.
14. Election of Board Directors and Chairman of the Board.
15. Resolutions concerning (a) a long-term share-based incentive programme, and (b) authorisation for the Board to decide on purchases of own shares, and transfers of treasury shares.

Item 1 - Election of Chairman of the AGM

Axfood's Nominating Committee for the 2025 AGM consists of Marie Ehrling (Nominating Committee Chairman, Axel Johnson Aktiebolag), Caroline Sjösten (Swedbank Robur Fonder), Sussi Kvart (Handelsbanken Fonder) and Carolina Ahnemark (Odin Fonder). In addition, Thomas Ekman, Chairman of the Board of Axfood, is a co-opted member of the Nominating Committee.

The Nominating Committee proposes Thomas Ekman to serve as Chairman of the AGM, or in his absence, the person appointed by Axfood's Nominating Committee.

Item 2 - Voting list

The voting list to be prepared by Computershare AB on behalf of the Company, based on the general meeting share register, shareholders registered for the AGM and present at the AGM, as well as postal votes received, is proposed as voting list.

Item 10 - Dividend and record dates

The Board of Directors proposes that the 2025 AGM resolves in favour of payment of a dividend of SEK 8.75 per share. The amount will be divided into two payments of SEK 4.50 per share in March 2025 and SEK 4.25 per share in September 2025. The record dates proposed for the payments are Friday, 21 March 2025 and Friday, 19 September 2025. With the specified record dates, dividends are expected to be paid on Wednesday, 26 March 2025 and Wednesday, 24 September 2025. The last dates for trading in the Company's shares including the right to a dividend are Wednesday, 19 March 2025 and Wednesday, 17 September 2025.

Item 12 - Number of Directors and Deputy Directors

The Nominating Committee proposes that the number of AGM-elected directors shall be eight (8) without any deputies.

Item 13 - Directors' fees and Auditor's fees

The Nominating Committee proposes the following directors' fees and auditor's fees:

• SEK 850,000 (previously 820,000) for the Chairman of the Board and SEK 545,000 (previously 525,000) for each of the AGM-elected non-executive directors,
• in addition to directors' fees, an additional SEK 245,000 (previously 230,000) for the Chairman of the Audit Committee and an additional SEK 110,000 (previously 105,000) for other members of the Audit Committee,
• in addition to directors' fees, an additional SEK 75,000 (unchanged) for the Chairman of the Remuneration Committee and an additional SEK 50,000 (unchanged) for other members of the Remuneration Committee,
• in addition to directors' fees, an additional SEK 20,000 (unchanged) per physical board meeting that takes place in Stockholm for attending directors who do not live in Sweden, and
• auditor's fees in accordance with approved invoices.

Item 14 - Election of the Board of Directors and Chairman of the Board

The Nominating Committee proposes:

• re-election of directors Fabian Bengtsson, Caroline Berg, Mia Brunell Livfors, Christian Luiga, Peter Ruzicka and Sara Öhrvall,
• election of Björn Annwall and Kristofer Tonström, and
• election of Caroline Berg as Chairman of the Board.

More detailed presentations of all proposed individuals are available on Axfood's website.

Item 15 - Long-term share-based incentive programme (LTIP 2025)

The Board of Directors proposes that the AGM resolve in favour of establishing a long-term share-based incentive programme (LTIP 2025) for employees of the Axfood Group and authorising the Board to decide on purchases of own shares, and that the AGM resolve in favour of transfers of treasury shares in accordance with items (A) and (B) below. The programme resembles the long-term share-based incentive programme that the 2024 AGM resolved to establish in all essential respects, except for the following changes. The previous performance criteria that the total share return (TSR) should exceed 0 per cent is removed and the Share right previously linked to the condition will instead be linked to TSR in relation to the comparison group and that this TSR target is reduced from 10 to 8 percentage units.

(A) Long-term share-based incentive programme

LTIP 2025 in summary

The main motives for establishing LTIP 2025 are to align the interests of the members of the Executive Committee and other key persons with the shareholders' interests in ensuring maximum long-term value creation and to encourage personal shareholding in Axfood. Furthermore, it is believed that LTIP 2025 will aid Axfood in recruiting and retaining persons for the Executive Committee and other key persons. Previous programmes have been highly appreciated with high participation rates and have led to a significant increase in share ownership by the Group's management over time.

LTIP 2025 includes approximately 85 employees, consisting of the members of Axfood's Executive Committee, members of the management teams of Axfood's subsidiaries, and certain other key persons. Participation in LTIP 2025 requires a personal shareholding in Axfood. After the set vesting period, the participants will be allotted shares in Axfood free of charge provided that certain conditions are met. These conditions are continued employment in the Axfood Group during the vesting period and that the allocation of the individual's shareholding in Axfood to the programme in question continues during the same period. Moreover, for each series certain performance targets must have been met, which are related to the total shareholder return ("TSR") on the Company's shares, the Axfood Group's total average sales growth contingent upon achievement of a certain average EBIT margin, and a higher portion of sales of sustainability-labelled products. The maximum number of shares in Axfood that may be allotted under LTIP 2025 shall be limited to 385,000, which corresponds to approximately 0.2 per cent of the total number of shares and votes in the Company.

Participants in LTIP 2025

Participants in LTIP 2025 are broken down into three categories. The first category includes the Chief Executive Officer and Group President ("Category 1"), the second category includes members of Axfood's Executive Committee, excluding the Chief Executive Officer and Group President, plus certain selected key persons (approximately 20 persons) ("Category 2"), and the third category includes members of the management teams of Axfood's subsidiaries and certain other key persons (approximately 64 persons) ("Category 3"). Additional persons who have not begun their employment in the Axfood Group when the deadline to apply for participation in the programme has expired may be invited to participate provided that their employment began no later than 31 December 2025 (whereby the number of persons in the various categories may be adjusted).

Personal investment and vesting period

Participation in LTIP 2025 requires that the participant has a personal shareholding in Axfood that is allocated to LTIP 2025 ("savings shares"). Savings shares can either be purchased for LTIP 2025 or be held previously, if they have not already been allocated to an incentive programme already in progress. Participation in LTIP 2025 can take place with a maximum of 4,700 savings shares (Category 1), 1,250 savings shares (Category 2), or 250 savings shares (Category 3), respectively. For all categories, each savings share entitles its owner to seven performance share rights ("Share rights"). If a participant is in possession of inside information and is therefore prevented from purchasing shares in Axfood prior to applying to participate in LTIP 2025, purchases of shares shall be made as soon as possible, but before 31 December 2025 at the latest. Any allotments of shares in Axfood will normally be made within two weeks after publication of Axfood's interim report for the 1 January-31 March 2028 period. The vesting period commences when the participant accepts an invitation to participate in the programme and continues until the interim report has been published.

Conditions for Share rights

The following conditions shall apply for the Share rights:

• Share rights are allotted free of charge during a certain period after the AGM.
• Share rights cannot be transferred or pledged.
• A precondition for the right to receive share allotments free of charge supported by Share rights is that the participant has not sold any of their savings shares and, with certain limited exceptions, that the participant remains employed in the Axfood Group during the vesting period. Furthermore, an allotment requires that certain performance-related targets are achieved by Axfood in the manner described under "Performance targets" below.
• To align the participants' interests with the shareholders' interests, Axfood will compensate the participants for profit dividends to the shareholders by increasing the number of shares that each Share right carries entitlement to.
• The maximum value (including any compensation that the participants receive for paid shareholder dividends) that a participant can receive per Share right is limited to SEK 936 which corresponds to 400% of the closing price for Axfood shares on 30 December 2024 (SEK 234.00). If the value of Axfood's shares at the time of the allotment exceeds the maximum value, the number of shares that each Share right carries entitlement to will be decreased to a corresponding degree.

Performance targets

The Share rights are broken down into Series A, Series B and Series C. Of the seven (7) Share rights that the participant may receive for each savings share, three (3) Share rights shall be in Series A, three (3) shall be in Series B and one (1) shall be in Series C. The number of Share rights that carry entitlement to allotment of shares depends on the achievement of the performance criteria that apply for the respective series as follows.

For assessment of the achievement of the performance targets for Series A and Series C the measurement period will run from 1 January 2025 to 31 December 2027. Regarding Series B, the start value shall consist of the average, volume-weighted price paid for a group of reference companies (the "Reference Group")¹⁾ on the 20 share trading days immediately after Axfood's year-end report for 2024 has been published. The final value shall consist of the average, volume-weighted price paid for the Reference Group on the 20 share trading days immediately after Axfood's year-end report for 2027 has been published.

Series A   The maximum level that carries entitlement to a full allotment is that the Axfood Group's total average sales growth equals or exceeds more than two (2) percentage units higher than Statistics Sweden's Retail Index, Food Retail, Retail with wide assortment, mainly groceries ("Average Market Growth"). The minimum level for an allotment is that the Axfood Group's total average sales growth is on par with Average Market Growth. If the Axfood Group's total average sales growth is less than the maximum level but exceeds the minimum level, the allotment shall be made on a straight-line basis according to the values there between. Furthermore, an allotment within the framework of Series A requires that the EBIT margin exceeds 3.5% in average.

Series B   The maximum level that carries entitlement to a full allotment is if the performance of Axfood's TSR is equal to or exceeds the accumulated TSR performance of the equally weighted average index of the Reference Group by eight (8) percentage units. The minimum level for an allotment is a TSR performance that is on par with the accumulated TSR performance in relation to the equally weighted average index for the Reference Group. If Axfood's TSR performance is less than the maximum level, but higher than the minimum level, the allotment shall be made on a straight-line basis according to the values there between.

Series C   The maximum level that carries entitlement to a full allotment is an increase in the share of sales of sustainability-labelled products by ten (10) per cent or more, accumulated during the 2025-2027 financial years, compared with the level on 31 December 2024. The minimum level for an allotment is that the Axfood Group's share of sales of sustainability-labelled products is on par with the share on 31 December 2024. If the share of sales of sustainability-labelled products is lower than the maximum level, but higher than the minimum level, the allotment shall be made on a straight-line basis according to the values there between.

1) The Reference Group consists of AAK, Carlsberg B, Clas Ohlson B, Cloetta B, Electrolux B, Essity B, Europris, H&M B, Kesko B, Orkla, Midsona B, Rusta and Scandi Standard. They are also measured for TSR. 

Structure and preparation of proposal

The Board of Directors, or a committee specifically appointed by the Board, shall be responsible for the more detailed structure and handling of LTIP 2025, within the framework of the stipulated conditions and guidelines. If significant changes take place in the Axfood Group or its external operating environment that could result in the decided conditions for allotments and the opportunity to exercise the Share rights in accordance with LTIP 2025 no longer being suitable or being excessive, the Board shall have the right to make adjustments. Before the number of shares that are to be allotted under the Share rights are finally determined, the Board shall assess whether the outcome from LTIP 2025 is reasonable. This assessment shall be made in relation to Axfood's financial result and position, and the conditions in the stock market etc. If the Board, in its assessment, determines that the outcome is not reasonable, the Board shall reduce the number of shares that are to be allotted. The Board shall also have the right to make the adjustments that may be required because of legal or administrative circumstances.

Scope

The maximum number of shares in Axfood that may be allotted under LTIP 2025 shall be limited to
385,000, which corresponds to approximately 0.2% of the total number of shares and votes in the Company. Based on the more detailed conditions that the Board decides on, the number of shares covered by LTIP 2025 may be subject to recalculation if Axfood carries out a bonus issue, share split or reverse split, rights issue, dividend compensation or similar measure, while observing customary practice for corresponding incentive programmes.

Hedge measures

The Board has considered two alternative hedge measures for LTIP 2025 - either a hedge arrangement (equity swap) with a bank to ensure delivery of shares under the programme, or a transfer of shares in Axfood to entitled participants in LTIP 2025. The Board is of the opinion that the latter alternative is the main alternative. The Board has therefore proposed that the AGM resolve to authorise the Board to decide on purchases of own shares, and transfers of shares in Axfood held by the Company in accordance with item (B) below. Should the AGM not approve the Board's proposal in accordance with item (B) below, the Board intends to enter into the above-mentioned hedge arrangement with a bank to secure the Company's obligation to deliver shares in accordance with the programme.

Scope and costs of the programme

The Share rights cannot be pledged or transferred to others. However, an estimated value of each share can be calculated. The Board has estimated the average value of each Share right to be SEK 183.20. This estimate is based on the closing price for Axfood shares on 6 February 2025. Assuming participation in the programme by all persons invited to participate, that they make the maximum investment, 100% achievement of the performance targets, and estimates of employee turnover, the total estimated cost of the Share rights is approximately SEK 50.5 m. This cost corresponds to approximately 0.10% of Axfood's market capitalisation on 6 February 2025. Based on the assumptions above, it is estimated that the total cost for LTIP 2025 including social security contributions will be approximately SEK 73.0 m, which on an annual basis corresponds to approximately 0.3% of Axfood's total personnel costs during the financial year of 2024.

The costs will be booked as personnel costs in the income statement over the vesting period in accordance with IFRS 2 Share-based Payments. Social security contributions will be expensed in the income statement over the vesting period in accordance with UFR 7. The level of these costs will be calculated based on Axfood's share price performance during the vesting period and allotments of Share rights.

Effects on important key ratios

Upon full participation in LTIP 2025, Axfood's personnel costs on an annual basis are expected to increase by approximately SEK 24.8 m (including social security contributions) based on the assumptions above. On a pro forma basis for 2024, these costs entail a negative effect of approximately 0.03 percentage units on Axfood's operating margin and a decrease in earnings per share by SEK 0.11. However, the Board believes that the positive effects on Axfood's financial result that are expected to arise through an increase in the participants' shareholdings and opportunity for additional allotments of shares under the programme outweigh the costs associated with LTIP 2025.

Drafting of proposal

The proposal for LTIP 2025 has been prepared by Axfood's Remuneration Committee and the Board of Directors and has been drafted in consultation with external advisers.

In order to ensure that the long-term incentive programmes are in line with market and with stakeholder expectations, Axfood also conducted a review of the scope and structure of the programmes in 2024, including by having an external party benchmark Axfood's programmes against Swedish Large Cap companies of similar size, as well as against comparable companies focusing on consumer products and grocery retail in the Nordic region and Europe. In addition to such a benchmark, reports from an external party on all Swedish Large Cap companies' long-term share-based incentive programmes between 2017 and 2022 were analysed. The review and benchmark show that Axfood's current programme structure is well adapted to, and in line with, common practice and other companies' incentive programmes, both in terms of performance criteria and targets as well as maximum cost. Thus, the programme structure is appropriate and fulfils its function and purpose. However, the analysis of the programme structure of other companies shows that the incidence of so-called "matching shares" has decreased significantly over time. The review of the programmes resulted in the changes proposed by the Board.

Other incentive programmes in Axfood

Three long-term share-based incentive programmes in Axfood which were approved by the 2022-2024 AGMs are already in effect. See Note 6 in Axfood's 2024 Annual and Sustainability Report, which will be kept available on Axfood's website on 26 February 2025 at the latest.

The Board's proposal for resolution

In reference to the description above, the Board of Directors proposes that the AGM vote in favour of LTIP 2025.

Majority requirement

The Board's proposal for a resolution to implement LTIP 2025 requires that the resolution is supported by shareholders representing more than half of the votes represented at the AGM.

(B) Authorisation for the Board to decide on purchases of own shares and transfers of treasury shares.

The Board's proposal for a resolution to authorise the Board of Directors to decide on purchases of own shares and its proposal for decisions concerning transfers of treasury shares in accordance with the description below are conditional upon the AGM first voting in favour of LTIP 2025 in accordance with item (A) above.

Share repurchases

The Board of Directors proposes that the AGM resolve to authorise the Board to, on one or more occasions during the period up until the next AGM, decide on purchases of own shares in accordance with the following:

• Purchases may be made of a maximum of 385,000 shares.
• Purchases of shares shall be made on Nasdaq Stockholm at a price per share that is within the registered price interval at any given time (the spread), meaning the interval between the highest buying price and the lowest selling price and in observance of the rules that apply at any given time in Nasdaq Stockholm's Rulebook for Issuers. However, for purchases that are made by a brokerage under assignment by the Company, the price of the shares may correspond to a volume-weighted average price during the period during which the shares were purchased, even if the volume-weighted average price on the day the shares were relinquished to the Company is outside the price interval.
• Payment for the shares shall be made in cash.
• Purchases may be made for the purpose of securing the Company's obligations under LTIP 2025 and any other share-based incentive programmes that may exist at any given time pursuant to a resolution by a general meeting of shareholders.

Transfers of treasury shares to participants in LTIP 2025

The Board of Directors proposes that the AGM resolve to transfer shares in the Company as follows:

• A maximum of 385,000 shares in Axfood (or such higher number of shares that may follow from a recalculation resulting from a bonus issue, split, rights issue or similar measure) may be transferred.
• The shares may be transferred to participants in LTIP 2025 who, according to the terms for LTIP 2025, are entitled to receive shares.
• Transfers of shares shall be made at the point in time and in accordance with the other conditions that the participants of LTIP 2025 are entitled to receive allotments of shares.

The reasons for the deviation from the shareholders' preferential rights is that the transfer of shares is part of the execution of LTIP 2025. The Board of Directors is therefore of the opinion that it is beneficial for the Company to transfer shares in accordance with the proposal.

Special majority requirement

Resolution by the AGM in accordance with item (B) is valid only if it has the support of shareholders representing at least nine-tenths of the number of votes and shares represented at the AGM.

Other information regarding the AGM

Special majority requirement

A resolution in favour of the Board's proposal in accordance with item 15 (B) (authorisation for Board to decide on purchases of own shares and transfers of treasury shares) is valid only if it has the support of shareholders representing at least nine-tenths of the number of votes and shares represented at the AGM.

Shares and votes

On the day this notice was issued, the Company had a total of 216,843,240 shares in issue with one vote each, of which the Company owns 1,098,345 treasury shares that may not be represented at the AGM.

Disclosures at the AGM

The Board of Directors and the CEO shall, if any shareholder so requests and the Board finds that it can be done without material harm to the Company, provide disclosures about conditions that could have an impact on the assessment of an item of business on the agenda, conditions that could have an impact on the assessment of the Company's or a subsidiary's financial situation, and the Company's relation to another Group company.

Processing of personal data

For information about Axfood's processing of personal data and your rights, see the Integrity Policy via the following link https://www.axfood.com/about-axfood/data-protection/.

Language

The AGM will be held in Swedish.

Documents

The Nominating Committee's reasoned statement and information about the individuals proposed for election to the Board are available on Axfood's website, www.axfood.com. Axfood's Annual and Sustainability Report 2024, the Auditor's Report, the Consolidated Accounts, the Auditor's Report over the Consolidated Accounts, the Auditor's Limited Assurance Report over the Sustainability Statement for 2024, the Board's statement regarding dividends in accordance with Chapter 18, Section 4 of the Swedish Companies Act and purchases of own shares in accordance with Chapter 19, Section 22 of the Swedish Companies Act, the Board's remuneration report in accordance with Chapter 8, Section 53a of the Swedish Companies Act, the auditor's opinion regarding the remuneration guidelines in accordance with Chapter 8, Section 54 of the Swedish Companies Act will be available from the Company at Solnavägen 4 in Stockholm, Sweden and on Axfood's website no later than three weeks before the AGM. The complete proposals are, otherwise, presented under each item in the AGM notice. Documents will be sent to those shareholders who specifically request it and state their postal address. The documents can be requested by email to proxy@computershare.se, by post to Computershare AB, reference "Axfood AGM", Gustav III:s Boulevard 34, 169 73 Solna, Sweden or by phone to +46 (0) 771 24 64 00.

 

Stockholm, February 2025

Axfood AB (publ)

Board of Directors

 

For further information, please contact:
Alexander Bergendorf, Head of Investor Relations, Axfood AB, tel +46 73 049 18 44



This document is an English translation of the Swedish original. In the event of any discrepancies, the Swedish version shall prevail.