Notification of Annual General Meeting of Clas Ohlson AB (publ)

The shareholders of Clas Ohlson AB (publ) are hereby notified of the Annual
General Meeting (“AGM”) to be held on Saturday, 10 September 2016 at 11:00 a.m.
at the company’s distribution centre in Insjön, Sweden. Registration will begin
at 9:45 a.m. After the AGM light refreshments will be served.
Registration and notification

Shareholders who intend to participate in the AGM must:

  · be listed in Euroclear Sweden AB’s printed shareholder register by Monday,
5 September 2016,
  · notify Clas Ohlson AB (publ) of their intention to participate in the AGM
not later than Monday, 5 September 2016; by post: Clas Ohlson AB (publ), SE-793
85 Insjön, Sweden; by fax: +46 247-444 25; by telephone: +46 247-444 00; by e
-mail: ir@clasohlson.se or via the company’s website
about.clasohlson.co (http://om.clasohlson.com/)m (http://om.clasohlson.com/). (h
t 
tp://om.clasohlson.com/)

Registration must include the shareholder’s (or shareholder proxy’s) name, civil
registration number/corporate registration number, address, telephone number,
the number of shares represented and the number of advisors. Shareholders or
their proxy are entitled to be accompanied by not more than two advisors. The
number of advisors must be registered in advance in the same manner as the
shareholder. Information submitted in connection with registration will be
computerised and used exclusively for the AGM.

Trustee-registered shares

Shareholders who, through a bank or another trustee, have trustee-registered
shares must re-register the shares in their own names to be entitled to
participate in the AGM. To ensure that this registration is entered in the
shareholder register on Monday, 5 September 2016, shareholders must request well
in advance of this date that their trustees conduct such registration. The re
-registration may be temporary.

Proxies

Shareholders who wish to exercise their voting rights at the AGM by proxy must
issue a dated power of attorney for the proxy in writing. Prior to the AGM, the
power of attorney should be sent to the above-stated address. A power-of
-attorney form is available for downloading at
about.clasohlson.co (http://om.clasohlson.com/)m (http://om.clasohlson.com/)
 (http://om.clasohlson.com/)or alternatively, will be sent to those shareholders
who so request and who provide their postal address. Representatives for legal
entities are to provide a copy of the registration certificate or corresponding
authorisation documents showing authorised signatories.

Number of shares and voting

The number of Series A shares in the company totals 5,760,000 carrying 10 votes
per share, corresponding to 57,600,000 votes, and the number of Series B shares
totals 59,840,000 carrying one vote per share, corresponding to 59,840,000
votes. Accordingly, there are a total of 65,600,000 shares and 117,440,000
voting rights in the company. The company holds 2,651,271 Series B treasury
shares, which may not be represented at the AGM.

Proposed agenda

 1. Opening of the AGM
 2. Election of Chairman of the AGM (see below)
 3. Preparation and approval of the voting list
 4. Approval of the agenda
 5. Election of one or two minutes checkers
 6. Determination that the Meeting has been duly convened
 7. Presentation of the Annual Report and Auditors’ Report and the Consolidated
Financial Statements and the Auditors’ Report on the Consolidated Financial
Statements for 2015/16
 8. Statement by the CEO
 9. Chairman of the Board’s report on the work of the Board and the Remuneration
and Audit Committees

10. Question time

11. Resolution concerning the adoption of the Income Statement and Balance Sheet
and the Consolidated Income Statement and Consolidated Balance Sheet for 2015/16

12. Resolution concerning the disposition of the company’s profits in accordance
with the balance sheet adopted for 2015/16 and determination of the record date
for the dividend (see below)

13. Resolution concerning the discharge of Board Members and the CEO from
liability for the 2015/16 financial year.

14. Determination of the number of Board Members, auditors and deputy auditors
to be elected by the AGM (see below)

 1.     Determination of the fees to be paid to Board Members and the auditors,
and remuneration for committee work (see below)

16. Election of Board Members, Chairman of the Board, auditors and any deputy
auditors (see below)

17. The Board of Directors’ motion concerning adoption of guidelines for
remuneration and other terms of employment for senior management (see below)

18. The Board of Directors’ motion concerning adoption of a long-term incentive
programme (“LTI 2017”) (see below)

19. The Board of Directors’ motion concerning authorising the Board of Directors
to make decisions on the company’s acquisition and transfer of treasury shares
and motion concerning the transfer of treasury shares (see below)

20. Closing of the AGM

Item 2, Election of Chairman of the AGM

The Nomination Committee proposes that Elisabet Salander Björklund be elected
Chairman of the Annual General Meeting.

Item 12, Resolution concerning the disposition of the company’s profits in
accordance with the balance sheet adopted for 2015/16 and determination of the
record date for payment of the dividend

The Board of Directors proposes that the retained earnings at the disposal of
the AGM, in an amount of SEK 782,191, be allocated so that SEK 377,200 be paid
as a dividend (SEK 5.75 per share) and that SEK 404,991 be carried forward. The
record date for payment of the dividend is proposed as 13 September 2016. If the
AGM votes in accordance with this motion, it is estimated that the dividend will
be distributed by Euroclear Sweden AB on 16 September 2016.

Items 14-16, Resolutions concerning the number of Board Members, auditors and
deputy auditors to be elected by the AGM, the fees to be paid to Board Members
and the auditors, and remuneration for committee work and election of Board
Members, Chairman of the Board, auditors and any deputy auditors

The company’s Nomination Committee, which was formed in accordance with a
resolution on the nomination procedure passed at the AGM of 11 September 2010
and which comprises Jonas Bergh, Erik Durhan, Göran Sundström, Ricard
Wennerklint and Kenneth Bengtsson, proposes the following resolutions concerning
Items 14-16.

The Nomination Committee proposes that the number of Board Members be eight and
that one auditor and no deputy auditor be appointed (Item 14).

The Nomination Committee proposes that director fees, including fees for
committee work, be paid in an amount of SEK 3,147,500 and be distributed as
follows: SEK 640,000 per year to the Chairman of the Board and SEK 320,000 per
year to each of AGM-elected non-executive Board members. The Nomination
Committee also proposes that remuneration of members of the Audit Committee be
paid in an amount of SEK 137,500 to the Chairman of the Audit Committee and SEK
68,750 to each of the two other members of the Committee, and that remuneration
of the Remuneration Committee be paid in an amount of SEK 125,000 to the
Chairman of the Remuneration Committee and SEK 62,500 to each of the three other
members of the Committee. The proposed director fees represent an increase of
less than 2 per cent and fees for committee work remain unchanged compared with
the preceding year. Any decisions by the Board to adjust the number of committee
members will also affect the total director fees. A fee may be paid as salary or
by invoice. If the fee is invoiced, it must be adjusted for social security
contributions and value-added tax with the purpose of achieving complete cost
neutrality for the company. It is proposed that audit fees during the auditors’
period in office be paid on a current-account basis in return for company
-approved invoices (Item 15).

The Nomination Committee proposes re-election of the Board members Klas Balkow,
Kenneth Bengtsson, Mathias Haid, Sanna Suvanto-Harsaae, Cecilia Marlow, Göran
Sundström and Göran Näsholm. Katarina Sjögren-Petrini has stated that she will
not be standing for re-election after three years on the Board. Ros-Marie Grusén
is proposed as a new Board member. The Nomination Committee proposes that
Kenneth Bengtsson be re-elected as Chairman of the Board. The Nomination
Committee proposes that Deloitte be appointed the company’s auditor for the
period from the close of the 2016 AGM until the close of the 2017 AGM (Item 16).

Ros-Marie Grusén, born 1971, is the Managing Director of Norsk Medisinaldepot
AS, and has served as the Managing Director of Admenta Sweden AB (Lloyds
Apotek), Managing Director of Plantagen Sweden AB and held a number of positions
at IKEA. Ros-Marie-Grusén is a Board member of Besqab AB and Granngården AB.

Information regarding the Board members proposed for re-election is available in
the Annual Report and on Clas Ohlson’s website.

Item 17, The Board of Directors’ motion concerning adoption of guidelines for
remuneration and other terms of employment for senior management

The Board of Directors proposes that the Annual General Meeting approve the
principles detailed in this item that will apply to remuneration and other
employment terms for the CEO and Clas Ohlson’s Group Management (Senior
Management).

The guidelines for remuneration and other employment terms for Senior Management
at Clas Ohlson have been established, with the overall objective to support Clas
Ohlson’s business strategy and the company’s financial goals. Clas Ohlson
intends to offer remuneration levels that will attract, retain and motivate key
individuals whose roles are to achieve our overall objectives. Guidelines for
remuneration of Senior Management cover the CEO, as well as other members of
Group Management.

Total remuneration

Total remuneration is to be based on position and be attractive and competitive
in the country of employment.

The company believes that a balanced remuneration structure will provide Senior
Management with the incentive to focus on creating long-term shareholder value,
while the company will have the opportunity to offer cash incentives for the
achievement of short-term performance objectives. The total remuneration
comprises:

  · fixed annual basic salary
  · variable performance-based remuneration

-      annual cash remuneration based on annual performance targets

-      long-term share-related remuneration based on three-year performance
targets or longer

  · pension and health benefits
  · other benefits that are common in the country of employment

Clas Ohlson aims to offer a competitive total level of remuneration, focusing on
payments based on performance. The objective is that the fixed annual basic
salary will be on par with or around that of the competitive market’s median.
When Clas Ohlson achieves or exceeds the established performance objectives, the
total remuneration is to be on par with or around the upper quartile of the
competitive market. This means that the variable remuneration may comprise a
significant portion of the total remuneration.

The market is defined mainly by the companies with which Clas Ohlson competes in
order to attract and retain Senior Management.

Total remuneration of the CEO is resolved by the Board of Directors following
recommendation by the Remuneration Committee. For other Senior Management,
remuneration is determined by the Remuneration Committee based on proposals from
the CEO, within the framework of the decisions by the Board of Directors.

Remuneration of Board members

Should a Board member perform work for Clas Ohlson, in addition to the Board
work, and if there are special reasons, a consultant’s fee and other
remuneration could be approved for such work following decisions by the Board of
Directors. The fees are paid in the form of salary or by invoice.

Fixed annual basic salary

The fixed annual basic salary is to constitute the basis for total remuneration.
The salary is to be related to the relevant competitive market and reflect the
extent of the responsibilities included in the position.

Adjustment of the fixed basic salary is to be based on the general wage
negotiation in the competing market and the performance level of the member of
Senior Management.

Fixed basic salary is reviewed annually to reward individual performances and
ensure continued competitiveness.

Variable performance-based remuneration

Variable performance-based remuneration may comprise a significant portion of
the total remuneration for members of Senior Management. Common for this type of
remuneration is that it is to be measured against set and predetermined goals.
The goals are to be based on operating financial or individual objectives and
are to support long-term shareholder value.

The company’s two variable incentive programmes for Senior Management take into
account both short and long-term performance.

Short-term incentives, STI

Short-term incentive, STI, is paid annually for efforts that fulfil or surpass
predetermined performance levels during a financial year. Performance objectives
are established annually by the Board of Directors or by senior executives
appointed by the Board. The measurable performances are to be financial,
operative or individual and related to the business plan. Remuneration paid from
the STI plan has a ceiling, normally expressed in percentage (max 50 per cent)
of the fixed annual basic salary. Insofar as performance does not match the
lowest acceptable performance level, no STI remuneration will be paid.

The Board is entitled to reclaim such remuneration approved or disbursed on the
basis of information that later proves to be obviously incorrect or on
performance that proved to be unsustainable over time.

The cost of the STI paid to Senior Management is estimated to range from between
SEK 0 to a maximum of MSEK 13.2. This amount includes the anticipated cost of
social security contributions.

Long-term incentives, LTI

At Clas Ohlson, share-based long-term incentive programmes are an integral part
of the total remuneration, which aims to reward the successful implementation of
the company’s strategy and the creation of long-term shareholder value.

The objective is to unite the long-term interests of shareholders and Senior
Management, while the opportunity for share-related remuneration also creates
the potential to attract and retain members of Senior Management.

The Board of Directors nominates participants for the LTI programme. The Board
of Directors will annually evaluate whether or not long-term incentive
programmes will be proposed at future AGMs.

Pension plan and health insurance

Pension agreements will, as a rule, be defined-contribution schemes and
formulated in accordance with levels and practice applicable in the country in
which the member of Senior Management is employed.

Other benefits may occur in accordance with the terms applicable in the country
in which the member of Senior Management is employed. However, such benefits may
not constitute a major proportion of the total remuneration. Health insurance is
to be offered to Senior Management.

Period of notice and severance pay

In the event employment is terminated on the initiative of the company, fixed
salary and severance pay during the period of notice may not exceed an amount
corresponding to the fixed annual basic salary for two years. During the period
of notice, the objective is that the member of Senior Management must be
prevented from working in a competing business.

In certain cases, prohibition of competition in return for continued
remuneration may be applied for a maximum period of 24 months following expiry
of the period of notice.

Other

The Board is entitled to disregard the guidelines if warranted in specific
cases.

Previously approved but as yet unpaid remuneration

The main terms and conditions for remuneration of Senior Management in the
current employment contracts are presented in Note 6 of the Annual Report for
2015-16.

Item 18, The Board of Directors’ motion concerning adoption of a long-term
incentive programme (LTI 2017)

Resolutions pursuant to this item, Item 18, are contingent on the AGM passing
resolutions in accordance with the Board’s proposals under Item 19 below.

Summary of the program

The Board of Directors proposes that the AGM resolve to adopt a long-term
incentive programme (LTI 2017). It is proposed that LTI 2017 encompass a maximum
of 100 participants (Participants), comprising two groups, (1) a maximum of 20
members of senior management including the CEO, Group Management and country
managers or corresponding positions elected by the Board, regarded as having
considerable potential in their present position to influence Clas Ohlson’s long
-term development (Senior Management) and (2) up to 80 other employees who could
develop into members of senior management or assume other key positions within
the Group and thus influence Clas Ohlson AB’s long-term development (Key
Individuals).

1. Senior management

Under LTI 2017, members of Senior Management will acquire during the period of
2–10

May 2017 (the Acquisition Period) Series B shares in Clas Ohlson at market price
on Nasdaq Stockholm at a value corresponding to at least 5 and a maximum of 10
per cent of their annual fixed salaries.

The private investment will subsequently be matched by the company allotting
free of charge restricted share awards and conditional performance-based
employee stock options subject to the following principles. Employee stock
options and share awards are allotted five days after the end of the Acquisition
Period (the Start Date). After which, a portion of the remuneration of the
members of senior management will be dependent on Clas Ohlson AB’s long-term
share price performance. A condition for the exercise of the share awards and
employee stock options is that the member of Senior Management retains his/her
invested shares and, with certain exceptions, remains employed from the Start
Date up to and including 30 April 2020 (the Qualification Period). For each
Series B share acquired within the framework of LTI 2017, the company will allot
a share award plus a number of preliminary employee stock options. Matching will
be based on the number of shares invested in by the member of Senior Management
at the ordinary stock-market price prevailing at the time of purchase. Each
share award entitles the holder to receive one Series B share in the company
free of charge and each exercisable employee stock option entitles the holder to
acquire one Series B share in the company (read more below under the heading
“Employee stock options”). The number of shares may be subject to recalculation
due to such events as bonus issues, share splits, rights issues and similar
measures.

Share awards

The following terms are to apply to share awards:

  · Entitlement to Series B shares in the company is conditional, subject to
certain exceptions, on the member of Senior Management having been continuously
employed by the Clas Ohlson Group throughout the Qualification Period and having
retained his/her private investment in the shares (see above).
  · Allotted free of charge.
  · The share awards may be exercised as of 30 April 2020.
  · The share awards do not provide entitlement to receive dividends on the
underlying shares during the Qualification Period.
  · Non-transferrable.
  · May be issued by the company or other Group companies.

Employee stock options

The following terms will apply to employee stock options:

  · Exercise of the options is conditional, with certain exceptions, on the
member of Senior Management’s continued employment by the Clas Ohlson Group at
the time of exercise, and having retained his/her private investment in the
shares throughout the Qualification Period (see above).
  · Allotted free of charge.
  · Each exercisable employee stock option entitles the holder to acquire one
Series B share in the company. The acquisition price of the shares when the
options are exercised is to correspond to 100 per cent of the volume-weighted
average of the most recent price paid for Series B Clas Ohlson shares on Nasdaq
Stockholm during a period of ten trading days prior to the first day of the
Acquisition Period.
  · The employee stock options will be exercisable at the earliest on 15 June
2020 up to 22 April 2024.
  · The share awards do not provide entitlement to receive dividends on the
underlying shares.
  · Non-transferrable.
  · May be issued by the company or other Group companies.

The number of employee stock options that may be exercised for acquiring shares
depends on the number of Series B shares acquired by the member of Senior
Management and the fulfilment of certain target levels established by the Board
regarding the company’s performance, growth and results during the Qualification
Period. The performance levels established are Entry, Target, Stretch and Max.
The following number of qualified performance-based employee stock options could
be exercised by members of Senior Management depending on the degree of
fulfilment of the performance levels.

-      Entry: five employee stock options/acquired Series B shares

-      Target: ten employee stock options/acquired Series B shares

-      Stretch: 15 employee stock options/acquired Series B shares

-      Max: 25 employee stock options/acquired series B shares (this level is
conditional upon the existence of a specific situation and a single member of
Senior Management fulfilling the exceptional tasks resolved by the Board).

Should the threshold level, Entry, not be attained, no employee stock options
will be allotted.

The number of performance-based employee stock options that may be exercised is
thus limited to 25 options per invested Series B share (Max).

The total scope of LTI 2017 may never exceed the number of shares indicated
under the heading “Distribution” below.

2. Key Individuals

LTI 2017 entails that Key Individuals on the Start Date (see definition under
Item 1 above) receive an allocation of conditional performance-based employee
stock options free of charge. The number of allotted employee stock options
corresponds to the number of shares, which, at the prevailing market price on
the Start Date, correspond to a value of a minimum of 5 per cent and a maximum
of 10 per cent of the Key Individual’s annual fixed salary. The following terms
will apply to employee stock options:

  ·  Exercise of the options is conditional, with certain exceptions, on the Key
Individual’s continued employment by the Clas Ohlson Group at the time of
exercise, and throughout the Qualification Period (see definition under Item 1
above).
  ·  Allotted free of charge.
  ·       Each exercisable employee stock option entitles the holder to acquire
one Series B share in the company. The acquisition price of the shares when the
options are exercised is to correspond to 100 per cent of the volume-weighted
average of the most recent price set for Series B Clas Ohlson shares on Nasdaq
Stockholm during a period of ten trading days prior to the first day of the
Acquisition Period (see definition under Item 1 above).
  ·  The employee stock options will be exercisable at the earliest on 15 June
2020 up to 22 April 2024.
  ·  The share awards do not provide entitlement to receive dividends on the
underlying shares.
  ·  Non-transferrable.
  ·  May be issued by the company or other Group companies.

The number of employee stock options that may be exercised for acquiring shares
depends on the number of Series B shares allotted to the Key Individual on the
Start Date and the fulfilment of certain target levels established by the Board
regarding the company’s performance, growth and results during the Qualification
Period. The three performance levels that were established are Entry, Target and
Stretch. The following number of qualified performance-based employee stock
options could be exercised by Key Individuals depending on the degree of
fulfilment of the performance levels.

-      Entry: Five employee stock options/allocated conditional upon performance
-based employee stock options on the Start Date

-      Target: Ten employee stock options/allocated conditional upon performance
-based employee stock options on the Start Date

-      Stretch: 15 employee stock options/allocated conditional upon performance
-based employee stock options on the Start Date

Should the threshold level, Entry, not be attained, no employee stock options
will be allotted.

The number of performance-based employee stock options that may be exercised is
thus limited to 15 options per allocated conditional performance-based employee
stock option on the Start Date (Stretch).

The total scope of LTI 2017 may never exceed the number of shares indicated
under the header “Distribution” below.

Design and management

The Board of Directors, or a special committee appointed by the Board, is to be
responsible for the detailed design and management of the incentive programme,
within the framework of the conditions and guidelines stipulated. In this
connection, the Board is to be entitled to make adjustments to fulfil specific
rules or market conditions abroad. The Board of Directors is also to be entitled
to make other adjustments should significant changes take place in the Clas
Ohlson Group or its business environment that would entail that the approved
conditions for matching and the opportunity to exercise share awards and
employee stock options under the incentive programme are no longer practicable.

The Board is also entitled to adjust the interval for the Acquisition Period,
for individual Participants, to the extent the Participant is covered by trade
embargo regulations when the Acquisition Period occurs.

Allocation

It is proposed that LTI 2017 consist of not more than 656,000 Series B shares
(see the heading “Programme’s scope and costs” below). Under LTI 2017, members
of     Senior Management will acquire during the Acquisition Period Series B
shares in Clas Ohlson AB at market price on Nasdaq Stockholm at a value
corresponding to at least 5 and a maximum of 10 per cent of their annual fixed
salaries. Following this, the investment will be matched by the company through
the allocation of restricted share awards, free of charge, and conditional
performance-based employee stock options, and Key Individuals will be allocated
conditional performance-based employee stock options at an allocation value of
up to 10 per cent of their annual fixed salaries (according to the principles in
Items 1-2 above). Vesting of employee stock options between the Entry and
Stretch performance levels occurs straight line. Should the threshold level,
Entry, not be attained, no employee stock options will be allotted.

Should the share price decline to such an extent that Series B shares are
acquired by members of Senior Management at a price resulting in LTI 2017
encompassing more shares than the proposed scope, allotment will be reduced
proportionately in accordance with principles determined by the Board of
Directors.

Scope and cost of the programme

Assuming a price of SEK 150 per Series B share that is acquired by members of
Senior Management as a private investment within the framework of LTI 2017, it
is estimated that the number of shares - at a maximum investment rate of 10 per
cent, attainment of the highest performance level (Max and Stretch,
respectively, see above concerning Senior Management and Key Individuals), and
full exercise of share awards and employee stock options of all Participants -
will not exceed 1 per cent of the total number of shares in the company.

The corresponding figure at a 5 per cent investment is a maximum of 0.72 per
cent of the total number of shares in the company. In the event of an investment
of 10 per cent and attainment of the threshold level (Entry), it is estimated
that the number of shares will not exceed 0.36 per cent of the total number of
shares. The corresponding figure at a 5 per cent investment is a maximum of 0.25
per cent of the total number of shares.

The LTI 2017 will be recognised in accordance with IFRS 2 Share-based Payment.
IFRS 2 prescribes that share awards and employee stock options have to be
expensed as a personnel cost across the Qualification Period. Based on
prevailing market conditions and assuming that the dividend is unchanged (5.75)
and that personnel turnover among nominated members of Senior Management and Key
Individuals is 5 per cent, the accounting cost as specified in IFRS 2 is
estimated to amount to MSEK 11 on condition that members of Senior Management
have acquired shares in Clas Ohlson AB corresponding to 7.5 per cent of basic
salary, that the share price at the date of acquisition is SEK 150 and that the
performance targets Max and Stretch, respectively, have been achieved. If all
members of Senior Management acquire shares for 10 per cent of their basic
salary and the performance ceilings Max and Stretch are achieved, the accounting
cost as specified by IFRS 2 is expected to amount to MSEK 14.5. The costs will
be allocated across the three-year Qualification Period. Social security
contributions will be added and will depend on the share price trend and the
attainment of performance targets.

The market value of performance-based employee stock options at the starting
date was calculated at SEK 22 per option by Willis Towers Watson in June 2016
using the binomial method. The present value of the options has been discounted
using a five-year government bond yield of -0.22 per cent. The calculation has
also taken into consideration the estimated time of use and anticipated
dividends during the duration of the plan. The target price is set at 100 per
cent of the volume-weighted average price paid for the company’s Series B share
as established on the Nasdaq Stockholm over a period of ten trading days prior
to the start of the Acquisition Period.

The acquisition price of the shares when the options are exercised is to
correspond to 100 per cent of the volume-weighted average of the most recent
price paid for Series B Clas Ohlson shares on Nasdaq Stockholm during a period
of ten trading days prior to the first day of the Acquisition Period.

A starting price of SEK 150 was used in the calculation. The final value will be
calculated at the starting date of LTI 2017. In addition, the market value of
the share awards has been estimated by Towers Watson, based on a share price
corresponding to SEK 150 at the date of allocation and an annual dividend of SEK
5.75, to amount to SEK 132, in which the fact that the present-value calculated
dividend is not to be paid to members of Senior Management and Key Individuals
has been taken into account.

LTI 2017 extends over a period of seven years in total. Assuming that the share
price rises by 4 per cent per year, the future share price will amount to SEK
197, equal to a value increase of SEK 47 per share. If all members of Senior
Management invest 10 per cent of their fixed annual salary and acquire Clas
Ohlson shares at a market value corresponding to SEK 150 each and Key
Individuals are allocated employee stock options corresponding to 10 per cent of
their fixed salaries, and that the performance ceiling is achieved (Max and
Stretch, respectively), the value of the LTI 2017 plan is estimated to be MSEK
34. Social security contributions are estimated at MSEK 11. Payment of future
social security contributions is covered by the proposed buyback programme (Item
19). During the same period, it is estimated that the market value of the
company will have increased by SEK 3.1 billion (share price increase of SEK 47
per share * 65.6 million shares).

The Board proposes a buyback programme (Item 19 on the Notification of the AGM)
in order to provide the company with the opportunity to transfer treasury shares
to members of Senior Management and Key Individuals, as described above, and to
also use repurchased shares to ensure sufficient liquidity for the payment of
future social security contributions associated with proposed and implemented
incentive programmes. The administrative work required for handling the plan
must be reasonable in relation to the programme’s design and scope and be
subject to approval by the Board of Directors. Since it is not intended to issue
any new shares as a result of the plan, the company’s registered share capital
and voting rights will not be subject to dilution.

Reasons for the motion

The purpose of the proposed incentive programme is to create potential to retain
and recruit competent personnel to the Group. LTI 2017 has been designed because
it is considered desirable that in future, members of Senior Management and Key
Individuals will become shareholders of Clas Ohlson to a greater extent than
today, which is expected to have a positive impact on their long-term work
performance and harmonise interests from Participants and shareholders.
Connecting remuneration of members of Senior Management and Key Individuals for
work performed and rewards to the company’s profit and value development will
continue to promote company loyalty and thus sustainable value growth in the
company. LTI 2017 has also been designed to ensure that the remuneration paid to
the Participants will be competitive in comparison with other comparable
companies in the industry. Against this background, the Board believes that the
introduction of LTI 2017 will have a positive effect on the Clas Ohlson Group’s
continued development and that LTI 2017 is thus beneficial to both shareholders
and the company.

Drafting of the matter

Pursuant to guidelines set out by the Remuneration Committee, the incentive
programme has been drafted by the management of Clas Ohlson AB in consultation
with external advisors. The incentive programme was addressed at Board meetings
during the spring and summer of 2016.

Other outstanding incentive programmes

A summary of the company’s other incentive programmes is presented in Note 6 of
the 2015/16 Annual Report and on the company’s website. Apart from the described
plans, there are no other incentive programmes in the company.

Majority requirements

To be valid, AGM resolutions in accordance with Item 18 must be supported by
shareholders representing at least half of the votes cast at the AGM.

Item 19, The Board of Directors’ motion concerning authorising the Board to make
decisions on the company’s acquisition and transfer of treasury shares and
motion concerning the transfer of treasury shares

The Board of Directors’ motion in accordance with this Item 19 is conditional
upon the AGM first passing resolutions in accordance with Item 18 above.

 1. Acquisition of treasury shares

The Board of Directors proposes that the AGM resolve to authorise the Board,
during the period up to the next AGM, to make decisions concerning the company’s
acquisition of shares in the company as follows.

 1. A maximum of 860,000 Series B shares may be acquired.
 2. The shares may be acquired on Nasdaq Stockholm.
 3. Shares obtained through trading on Nasdaq Stockholm may only be acquired at
a price per share that at every point of time is within the registered span of
share prices.
 4. Payment for the shares must be made in cash.

Acquisitions may occur to safeguard the company’s commitments (including social
security contributions) resulting from LTI 2017 and earlier implemented
incentive programmes.

 1. Transfer of treasury shares

The Board of Directors proposes that the AGM resolve to authorise the Board,
during the period up to the next AGM, to make decisions concerning the transfer
of shares in the company as follows.

 1. A maximum of the Series B shares held at the time of the Board of Directors’
decision may be transferred.
 2. The shares may be transferred via Nasdaq Stockholm.
 3. Transfer of shares on Nasdaq Stockholm may only occur at a price per share
that at every point of time is within the registered span of share prices.
 4. Payment for the shares must be made in cash.

The reason underlying the Board of Directors’ motion is to provide the company
with an opportunity to continuously adapt the number of shares acquired to
safeguard commitments (including social security contributions) within the
framework for LTI 2017 and earlier implemented incentive programmes.

 1. Transfer of treasury shares

The Board of Directors proposes that the AGM resolve upon a transfer of shares
in the company as follows.

 1. A maximum of 656,000 Series B shares may be transferred.
 2. Entitlement to receive shares is to accrue to the Participants, with each
Participant entitled to receive at most the number of shares that result from
the conditions for LTI 2017.
 3. The Participants will be entitled to exercise their right to acquire shares
no earlier than 30 April (regarding share awards) and 15 June 2020 (regarding
employee stock options) and no later than 22 April 2024.
 4. The Participants’ entitlement to receive shares is subject to fulfilment of
all of the conditions established for the plan.
 5. Transfer of share awards issued in accordance with LTI 2017 will occur free
of charge.
 6. Transfer of shares based on employee stock options issued in accordance with
LTI 2017 will occur at a price corresponding to 100 per cent of the volume
-weighted average price paid for the company’s Series B share as established on
Nasdaq Stockholm over a period of ten trading days prior to the start of the
Acquisition Period.
 7. In accordance with the terms and conditions for the plan, the number of
shares that may be subject to transfer under LTI 2017 may become subject to
recalculation due to such events as bonus issues, splits, rights issues and
similar measures.
 8. Payment for the acquired shares must be made no earlier than 15 June 2020
and no later than 10 May 2024.

The transfer of treasury shares and the reason for disapplying the shareholders’
preemptive rights are a feature of LTI 2017 proposed by the Board under Item 18.

Shareholders’ right to request information

At the AGM, if
requested by a shareholder and deemed possible without occasioning material
damage to the company, the Board of Directors and President are to provide
information conditions that could impact an item on the agenda, or conditions
that could impact the assessment of the financial situation of the company (or
subsidiaries) or the company’s relationship to other Group companies (meaning,
the right to request information pursuant to Chapter 7, Section 32 of the
Swedish Companies Act).

Majority requirements

To be valid, resolutions by the AGM in accordance with Items 19 A and 19 B above
must be supported by shareholders representing at least two thirds of both the
votes cast and the shares represented at the AGM. To be valid, resolutions by
the AGM in accordance with Item 19 C above must be supported by shareholders
representing at least nine tenths of both the votes cast and the shares
represented at the AGM.

Complete proposals

The Nomination Committee’s complete proposals concerning resolutions under Items
2 and 14-16 and the Board of Directors’ complete motions concerning resolutions
under Items 12 and 17-19 are presented above.

The accounting documentation and audit report pertaining to the 2015/16
financial year, the Board of Directors’ statement in accordance with Chapter 18,
Section 4 of the Swedish Companies Act concerning the distribution of profits
and in accordance with Chapter 19, Section 22 of the Swedish Companies Act
concerning authorisation for the acquisition of treasury shares, as well as the
auditor’s statement pursuant to Chapter 8, Section 54 of the Swedish Companies
Act concerning compliance with the guidelines for remuneration of senior
management will be made available at the company no later than 19 August 2016
and will also be sent by post to shareholders who provide their postal address.

All of the documents specified under the above heading will be made available in
an electronic format on the company’s website,
about.clasohlson.co (http://om.clasohlson.com/)m (http://om.clasohlson.com/), (h
t 
tp://om.clasohlson.com/) as of 8 August 2016.

Clas Ohlson AB (publ)

Board of Directors
For more information, please contact:
Sara Kraft Westrell, Director of Information and Investor Relations, phone +46
247 649 13
Clas Ohlson was founded in 1918 as a mail order business based in Insjön,
Sweden. Today, the company offers products and services for the small everyday
practical problems, in six countries via its over 200 stores and online. Clas
Ohlson offers a wide range of affordable products in five product areas:
Hardware, Electrical, Home, Multimedia and Leisure. The company is listed on
Nasdaq Stockholm, has sales of over 7.5 billion SEK and more than 4,700
employees. Visit Clas Ohlson at www.clasohlson.com