Annual General Meeting in Alfa Laval AB (publ)
Program for shareholdersIn connection with the meeting, there will be an opportunity to view the production of plate heat exchangers at the facility in Lund. The tour begins with a gathering at Sparbanken Skåne Arena, not later than 1.30 p.m. Buses will then transport the visitors to the production facility and afterwards back to the premises at which the meeting will be held. The number of visitors on the tour is limited, and a notification of participation in the tour shall be made in connection with the notification of participation in the Annual General Meeting.
1.30 p.m. The buses depart from Sparbanken Skåne Arena to the Alfa Laval production facility in Lund3.00 p.m. Coffee is served adjacent to the premises at which the meeting is held3.30 p.m. Registration for the Annual General Meeting begins4.00 p.m. The Annual General Meeting is opened
Right to participate- A shareholder who wishes to participate in the meeting and have the right to vote shall be registered in the share register maintained by Euroclear Sweden AB on Tuesday 17 April 2018, and- notify its participation to Alfa Laval AB – together with any advisors (though not more than two) – not later than on Tuesday 17 April 2018, preferably before 12.00 noon.
In addition, a shareholder whose shares are nominee-registered must temporarily have its shares registered in its own name in the share register maintained by Euroclear Sweden AB in order to be entitled to participate in the meeting. Such temporary ownership registration shall be executed by Tuesday 17 April 2018. This means that the shareholder must notify the nominee in ample time prior to that date.
NotificationNotification to participate in the meeting can be made
· by mail: Alfa Laval AB, Juridik, P.O. Box 73, SE-221 00 Lund, Sweden, · by e-mail: firstname.lastname@example.org, · on the website: www.alfalaval.com/investors, or · by telephone +46 46 36 74 00 or +46 46 36 65 00.
The notification shall include name, personal or corporate ID number, address and telephone number as well as information of any advisors (though not more than two). The notification shall also include any wish to participate in the tour of the production facility. A proxy for a shareholder shall, at the Annual General Meeting at the latest, present the original copy of a dated proxy form in writing. The proxy form may at the time of the meeting not be older than one year, if not the limitation stated in the proxy is longer (not more than five years). A proxy form can be obtained from Alfa Laval AB, Juridik, P.O. Box 73, SE‑221 00 Lund, Sweden and is also available at the Company’s website, www.alfalaval.com/investors/corporate-governance/annual-general-meetings. In addition, a proxy or a representative of a legal entity shall submit a certificate of registration no later than at the Annual General Meeting. To facilitate the registration, the proxy form and, if applicable, the certificate of registration shall be sent (although not electronically) to Alfa Laval AB in connection with the notification. Alfa Laval AB will, on 18 April 2018 at the earliest, dispatch an entrance card to be produced at the registration as a confirmation of the notification.
1. Opening of the meeting. 2. Election of a Chairman for the meeting. 3. Preparation and approval of the voting register. 4. Approval of the agenda for the meeting. 5. Election of one or two persons to attest the minutes. 6. Determination whether the meeting has been duly convened. 7. Statement by the Managing Director. 8. Report on the work of the Board of Directors and the Committees of the Board of Directors. 9. Presentation of the annual report and the Auditor’s report, as well as the consolidated annual report and the Auditor’s report for the group, and the Auditor’s report regarding compliance with the guidelines for compensation to senior management adopted at the 2017 Annual General Meeting.10. Resolution on
(a) the adoption of the income statement and the balance sheet as well as the consolidated income statement and the consolidated balance sheet;
(b) allocation of the Company’s profit according to the adopted balance sheet, and record date for distribution of profits; and
(c) discharge from liability for members of the Board of Directors and the Managing Director.
11. Report on the work of the Nomination Committee.
12. Determination of the number of members of the Board of Directors and deputy members of the Board of Directors to be elected by the meeting as well as the number of Auditors and deputy Auditors.
13. Determination of the compensation to the Board of Directors and the Auditors.
14. Election of Chairman of the Board of Directors, other members of the Board of Directors and deputy members of the Board of Directors, Auditors and deputy Auditors.
15. Resolution on guidelines for compensation to senior management.
16. Resolution on the Nomination Committee.
17. Closing of the meeting.
The Nomination Committee proposes that the Chairman of the Board of Directors, Anders Narvinger, is appointed Chairman of the 2018 Annual General Meeting.
Item 10 (b)
The Board of Directors proposes a distribution of profits in an amount of SEK 4.25 per share for 2017. Wednesday 25 April 2018 is proposed as record date for the right to receive dividend. If the meeting resolves in accordance with this proposal, Euroclear Sweden AB is expected to pay the dividend on Monday 30 April 2018.
Item 12 -14
The Nomination Committee proposes as follows:
Item 12: The number of members of the Board of Directors to be elected by the meeting is proposed to be seven with no deputies. Both the number of Auditors and the number of deputy Auditors are proposed to be two.
Item 13: The compensation to the Board of Directors is proposed to be a total of SEK 5,035,000 (SEK 5,250,000) to be distributed among the members of the Board of Directors who are elected by the meeting and not employed by the Company as follows:
Chairman of the Board of Directors: SEK 1,675,000 (SEK 1,575,000)Other members of the Board of Directors: SEK 560,000 (SEK 525,000)
In addition to the proposed compensations to members of the Board of Directors, it is also proposed that the compensations mentioned below shall be distributed to the members who are Chairman or member of the Committees mentioned below. The proposed compensations are as follows:
Extra amount for the Chariman of the Audit Committee: SEK 175,000 (SEK 175,000)Extra amount for the other members of the Audit Committee: SEK 125,000 (SEK 125,000)Extra amount for the Chairman of the Remuneration Committee: SEK 50,000 (SEK 50,000)Extra amount for the other members of the Remuneration Committee: SEK 50,000 (SEK 50,000)
Bracketed figures refer to compensation for 2017.
Compensation to the Auditors is proposed to be paid as per approved invoice.
Item 14: Members of the Board of Directors Anders Narvinger, Finn Rausing, Jörn Rausing, Ulf Wiinberg, Margareth Øvrum and Anna Ohlsson-Leijon are proposed to be re-elected for the time up to the end of the 2019 Annual General Meeting. Henrik Lange is proposed to be elected as new member of the Board of Directors. Arne Frank tragically passed away during 2017 and Ulla Litzén has declined re-election.
Henrik Lange is 56 years old and has an MBA in International Economics & Business Administration from City University Business School in UK and a BSc in International Business Administration from the University of Gothenburg. Henrik Lange is since 2015 CEO of Gunnebo AB. He has previously held different senior positions in SKF Group, such as EVP and CFO of SKF Group and President of the Industrial Market. Between 2000 and 2003 he was the CEO of Johnson Pump, Sweden. Henrik Lange is board member of, among other things, Velux A/S.
The Nomination Committee proposes that Anders Narvinger shall be appointed Chairman of the Board of Directors. Should Anders Narvinger’s assignment as Chairman of the Board of Directors end prematurely, the Board of Directors shall appoint a new Chairman.
Information on all members proposed to the Board of Directors and the Nomination Committee’s reasoned statement is available at Alfa Laval AB’s website, www.alfalaval.com and will also be available at the meeting.
The Nomination Committee proposes, in accordance with the Remuneration Committee’s recommendation, that the authorized public accountants Staffan Landén and Karoline Tedevall are elected as the Company’s Auditors for the forthcoming year, thus for the time up to the end of the 2019 Annual General Meeting. The Nomination Committee further proposes that the authorized public accountants Henrik Jonzén and Nina Bergman are elected as the Company’s deputy Auditors for the forthcoming year, thus for the time up to the end of the 2019 Annual General Meeting.
Item 15: The Board of Directors proposes that the meeting adopts a resolution on the following guidelines for compensation to senior management:
The term senior management refers to the Managing Director and the group management. These guidelines apply to employment contracts for members of the senior management entered into following the adoption of these guidelines by the meeting, and to amendments to existing employment contracts for senior management made thereafter. The Board of Directors has the right to deviate from the guidelines if there are special circumstances for such deviation in an individual case. Special circumstances may, e.g., be that it must be possible to offer to members of the senior management who reside outside Sweden terms which are competitive in their country of residence.
2. The main principle and how compensation matters are prepared
The main principle for the guidelines is that Alfa Laval AB shall offer compensation on market terms so that the Company can attract and retain a competent senior management. The Board of Directors has established a Committee within the Board, with the tasks of preparing the guidelines for compensation for the senior management, which shall be resolved upon by the Annual General Meeting, as well as to propose to the Board of Directors remuneration and employment provisions for the Managing Director. The Board of Directors shall resolve on matters regarding remuneration and employment provisions for the Managing Director following preparation by the Remuneration Committee. The Committee shall resolve on matters regarding remuneration and employment provisions for senior management which reports directly to the Managing Director. The Committee shall continuously report to the Board of Directors.
3. Fixed compensation
The fixed salaries shall be revised annually and shall be based upon areas of responsibility and results of each individual.
4. Variable compensation
The variable compensation comprises (i) an individual annual variable compensation, and may also, as a supplement, include (ii) a long-term incentive program.
(i) The individual annual variable compensation may be between a maximum of 40 and 60 percent of the fixed compensation, depending on position. The outcome depends on the degree of fulfilment of, in particular, financial targets, and to a more limited extent also on qualitative targets.
(ii) The long-term incentive program directed to not more than 95 of the Company’s top executives, including the senior management, is intended to be a supplement to the individual annual variable compensation.
It is the Board of Directors’ proposal to implement a long-term incentive program for 2018, on slightly modified terms compared to those of the previously running programs. The long-term incentive program for 2018 is, as the long-term incentive programs for 2015, 2016 and 2017, a cash-based program. Previous programs are connected to the Company’s earnings per share, taking possible acquisitions of the Company's own shares into account. The long-term incentive program for 2018 is proposed to be on EBITA and Net Invoicing growth, with a 50/50 weight. The outcome of the program is calculated as an average of the outcome of EBITA and Net Invoicing growth for the three program years. Maximum outcome is awarded when the externally communicated long-term financial targets are clearly exceeded.The remuneration from the modified long-term incentive program can constitute between maximum 20 and 50 percent of the fixed compensation depending on position. The program runs, as previously, for three years. Payment to the participants of the program is made after year three, provided, however, that they are still employed at the date of payment.
The Board of Directors may consider to propose the General Meeting a share or share price-related program for the senior management.
5. Pension benefits
A detailed description of current pension schemes for the senior management is available in note 6 of the Annual Report for 2017.
Early retirement is offered selectively and only after a special decision by the Remuneration Committee. As from 2006, a premium based early retirement scheme with a premium of 15 percent of the pensionable income is offered.
For old-age pension, in addition to the ITP benefits, a premium based scheme, with a premium of 30 percent of the pensionable income above 30 basic amounts is being offered since 2006. Members of the senior management also have a survivor’s pension consisting of either a life insurance or a special family pension filling the gap between the old-age pension and the family pension according to the ITP plan. In addition, they have the opportunity to allocate salary and bonus to a temporary old-age and family pension.
6. Non-monetary benefits
Members of the senior management have the right to normal non-monetary benefits, such as company car and healthcare benefits.
7. Dismissal and severance pay
Should Alfa Laval AB dismiss a member of the senior management, the compensation during the notice period and the severance pay may be an amount corresponding to a maximum of two yearly salaries.
The current Nomination Committee consists of Finn Rausing (Tetra Laval), Johan Strandberg (SEB Investment Management), Lars‑Åke Bokenberger (AMF), Jan Andersson (Swedbank Robur fonder) and Ramsay Brufer (Alecta) as well as the Chairman of the Board of Directors, Anders Narvinger. Finn Rausing is Chairman of the Nomination Committee.
The Nomination Committee proposes that the Annual General Meeting 2018 resolves to adopt the following principles for appointment of Nomination Committee and the assignment of the Nomination Committee and that the principles shall be applicable until the General Meeting resolves otherwise.
The Chairman of the Board of Directors shall be assigned, in consultation with the company’s major shareholders, to appoint a Nomination Committee ahead of the forthcoming Annual General Meeting.
The Nomination Committee shall comprise of the Chairman of the Board of Directors and a minimum of five committee members. The committee members shall consist of the largest shareholders, or group of shareholders that have been grouped together in the Euroclear system (such group shall be viewed as one shareholder) based on Euroclear Sweden AB’s shareholder information at 31 August the year prior to the Annual General Meeting.
If a shareholder waives the right to appoint a representative, the shareholder who is the next largest owner shall be offered the opportunity to appoint a representative. The majority of the members of the Nomination Committee shall be independent from the company and company management. The Nomination Committee’s mandate period extends until a new Nomination Committee has been appointed. If an already appointed member resigns from the Nomination Committee, the shareholder that has appointed the member shall have the right to appoint a new member as replacement. If the major shareholder whom an appointed member represents significantly reduces its shareholding in the company, the Nomination Committee may offer another shareholder to appoint a member as replacement.
The duties of the Nomination Committee include:
· to evaluate the composition and work of the Board of Directors, · to prepare a proposal to the Annual General Meeting regarding election of the Board of Directors and the Chairman of the Board of Directors, · to prepare a proposal, in cooperation with the company’s Audit Committee, to the Annual General Meeting regarding election of auditor, · to prepare a proposal to the Annual General Meeting regarding fees to the Board of Directors, divided between the Chairman and other Board members as well as possible remuneration for committee work, and auditor, · to prepare a proposal to the Annual General Meeting regarding a Chairman for the Meeting, and · to prepare a proposal on principles for appointment of the next Nomination Committee, to the extent applicable.
The composition of the Nomination Committee shall be announced in the company’s financial report for the third quarter and published on the company’s website no later than six months prior to the Annual General Meeting. The Nomination Committee is entitled to receive reasonable remuneration from the company for expenditure incurred with regard to evaluation and recruitment. Members of the Nomination Committee shall not receive any remuneration from the company.
The annual report, the Auditors’ report, the Board of Directors’ reasoned statement regarding the proposed distribution of profits under item 10 (b), the Auditors’ report regarding compliance with the guidelines for compensation to senior management adopted at the Annual General Meeting held in 2017 and complete proposals for all other resolutions as set out above will be held available for the shareholders at Alfa Laval AB on Monday 26 March 2018 at the latest. Copies of the documents will be sent to shareholders who so request and state their postal address. The documents will also be held available on the Company’s website, www.alfalaval.com/investors/corporate-governance/annual-general-meetings no later than on the above-mentioned date. The proposals from the Nomination Committee and their reasoned statement will also be published on the same web address.
Number of shares and votes in the Company
At the date of this notice, the total number of shares and votes in the Company is 419,456,315. All shares are of the same class. The Company itself holds no shares in the Company.
Information at the Annual General Meeting
The Board of Directors and the Managing Director shall, if any shareholder so requests, and if the Board of Directors considers that this can be done without significant harm for the Company, give information on circumstances that can affect the assessment of an item on the agenda, circumstances that can affect the assessment of the financial situation of the Company or its subsidiaries and the Company’s relationship with another group company.
Lund, March 2018
ALFA LAVAL AB (publ)
The Board of Directors