Convertible and stock option program approved

The extraordinary general meeting of Axfood AB held today approved the Board’s proposal to issue a convertible debenture to be subscribed by employees of the Group in Sweden, and the issue of promissory notes with detachable warrants for new shares in Axfood. The warrants will be transferred to 16 senior executives of the Axfood Group.

The main terms for the issue of the convertible debenture are as follows:

* The loan will amount to a maximum of 140 million kronor and will run from 22 January 2001 through 20 April 2006. The loan will carry annual interest equivalent to the 12 month STIBOR rate less 1.0 percentage point. * The application period for the program is 15 November to 28 November 2000. The settlement date is 22 January 2001. * Each employee is entitled to subscribe for a maximum of 127,500 kronor in blocks of 8,500 kronor. All employees are guaranteed to be able to subscribe for 2 blocks. * The conversion price is set at 114% of the average market price of Axfood shares during the period 15-21 November 2000. The dilution effect is calculated to amount to a maximum of 2.8% of the share capital and votes.

The main terms of the warrants are as follows:

* A maximum of 427,500 warrants may be issued. The persons who will be included in the offer will be entitled to purchase 17,500-60,000 warrants, depending on their position, against payment of a going-rate premium which will be set by Handelsbanken Investment Banking. * Each warrant will carry entitlement to subscribe for one new share during the period 22 November 2003 – 21 August 2004, at a subscription price corresponding to 120% of the average price paid for Axfood shares during the period 15-21 November 2000. * The application period for the program is 15-28 November 2000, and the settlement date is 20 December 2000. * Upon full exercise of the warrants, the share capital will increase by 2.1 million kronor. The dilution effect upon full exercise of the warrants during the program amounts to 0.8% of the capital and votes.

The extraordinary general meeting also authorized the Board to make a decision regarding repurchase of own shares of a maximum of 1,600,000, to be used as payment for the acquisition of the retail chain HP Billigt och Nära. The purchase of shares will be made on the OM Stockholm Exchange.

About Us

Axfood AB conducts retail trade through the wholly owned store chains Hemköp, Willys and Willys hemma and wholesale trade through Dagab and Axfood Närlivs. In addition, Axfood collaborates with a number of proprietor-run stores that are tied to Axfood through agreements.


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