Railcare Group — AGM Information 2020

Mar 31, 2020

Press release

Notice to attend the annual general meeting of Railcare Group AB (publ)

NOTICE OF PARTICIPATION

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Nominee registered shares

Proxy etc.

PROPOSED AGENDA

• 1. Opening of the meeting.
• 1. Election of the chairman at the meeting.
• 1. Preparation and approval of the voting list.
• 1. Approval of the agenda.
• 1. Election of one or two persons to approve the minutes.
• 1. Determination of whether the meeting has been duly convened.
• 1. Address by the managing director.

• Presentation of the annual accounts and the audit report and the consolidated financial statements and the consolidated audit report.

• 1. Resolutions regarding:
  2. a) statement and the consolidated balance sheet.

b) allocation of the company's earnings in accordance with the duly adopted balance sheet.

c)

1. Determination of the number of board members, deputy board members and of the numbers of auditors and deputy auditors.

2. 1. Resolution of remuneration for the board of directors and the auditor.
3. 1. Election of board members and auditor.
4. 1. Resolution regarding guidelines for remuneration to senior executives.
5. 1. Closing of the meeting.

THE ELECTION COMMITTEES PROPOSED RESOLUTIONS WITH RESPECT TO ITEMS 2 AND 10-12 ON THE AGENDA

The election committee has consisted of Ake Elveros, appointed by Norra Västerbotten Fastighets AB, Per Martin Holmgren, appointed by TREAC AB and Kjell Lindskog, appointed by the Marklund & Dahlqvist Families. The chairman of the election committee has been Åke Elveros.

Election of the chairman at the meeting (item 2)

The election committee proposes Catharina Elmsäter-Svärd as chairman of the meeting.

Determination of the number of board members and the number of auditors (item 10)

The election committee proposes that the annual general meeting resolve that the numbers shall be six and that there shall be one auditor.

Determination of remuneration to the board of directors and auditor (item 11)

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• •

Election of board members and auditor (item 12)

PROPOSALS BY THE BOARD OF DIRECTORS WITH RESPECT TO RESOLUTIONS UNDER ITEMS 9b AND 13 OF THE AGENDA

Resolution regarding allocation of the company's earnings in accordance with the duly adopted balance sheet (item 9b)

Resolution regarding remuneration to senior executives (item 13)

The guidelines' promotion of the company's business strategy, long-term interests and sustainability

A successful implementation of the company's business strategy and the safeguarding of the company's longterm interests, including its sustainability, presuppose that the company is able to recruit and retain qualified employees. This requires the company to be able to offer a competitive total compensation, which is made possible through these guidelines. The total remuneration shall be marketable and competitive and be related to responsibility and competence.

Forms of remuneration, etc.

The remuneration shall be marketable and consist of the following components: fixed salary in accordance with separate agreements, pension and other benefits. The general meeting may in addition to that – irrespective of these guidelines – resolve on, for instance share price-based remuneration.

Fixed salary

The fixed salary shall consist of fixed cash salary and shall be reviewed yearly. The fixed salary shall be competitive and reflect the demands of the position held regarding competence, responsibility, complexity and in which way the position promotes the business targets. The fixed salary shall also reflect the performance of the executive and is therefore individual and differentiated.

Variable salary

In addition to the fixed salary, the managing director and other senior executives may, in accordance with separate agreements, receive variable salary upon fulfilment of the predetermined criteria. Any variable salary can be paid either as a cash salary or as a one-time pension provision. Payments as a one-time pension provision are adjusted so that the total cost for the company becomes neutral. The basic principle is that the variable salary component per year can amount to a maximum of 20 per cent of the fixed annual salary. To avoid unnecessary risk taking, there must be a fundamental balance between fixed and variable salary. The fixed salary shall account for a sufficiently large portion of the senior executive's total remuneration in order for it to be possible to reduce the variable part to zero.

The variable salary shall be linked to one or several predetermined and measurable targets resolved by the board of directors and which may be financial, such as the group's profitability and cash flow or non-financial, such as sustainability, customer satisfaction, quality and corporate culture. As the targets are linking the senior executive's remuneration to the company's result and sustainability, they promote the accomplishment of the company's business strategy, long-term value growth and competitiveness. The terms and basis of calculation for variable salary shall be established for each fiscal year. The fulfillment of criteria for payment of variable salary must be measurable during a period of one financial year. Variable salary is settled the year after earning.

When the measurement period for fulfilling the criteria for pavment of variable salary has ended, the extent to which the criteria have been met shall be assessed. As far as financial targets are concerned, the assessment shall be based on the latest financial information published by the company.

The criteria for variable remuneration shall be formulated in a way that allows the board of directors to, in case of exceptional financial circumstances, limit or abstain from payment of variable remuneration if such a measure is deemed reasonable.

When designing variable remuneration to the executive management, the board of directors shall consider introducing reservations that (i) conditionally disburses some part of such compensation on that the performance on which the vesting is based proves to be sustainable over time and (ii) gives the company the opportunity to recover such remuneration paid on the basis of data which subsequently proved to be obviously incorrect.

Additional variable cash compensation may be paid in exceptional circumstances, provided that such extraordinary arrangements are time-limited and made only at the individual level either with the purpose of recruiting or retaining executives, or as compensation for extraordinary work in addition to the person's regular job assignment. Such compensation may not exceed an amount corresponding to 30 per cent of the fixed annual salary and shall not be paid more than once a year and per individual. A decision on such remuneration shall be made by the board of directors on a proposal from the Remunerations Committee.

Pension

For the managing director and other senior executives, pension benefits, including health insurance, shall be defined contribution unless the executive is covered by defined benefit pension under mandatory collective agreement provisions. As a general rule, variable salary should be pension qualifying. Premiums for defined contribution pensions are not to exceed 35 per cent of the pension qualifying salary (which includes pension qualifying variable salary). Wage waivers can be utilized for increased occupational pension provisions through one-time paid pension premiums, provided that the total cost for the company becomes neutral. The pension qualifying salary corresponds to the fixed monthly salary multiplied by a factor of 12.2 and any variable salary.

Other benefits

Other benefits, which may include company car, travel benefits, extra health and medical insurance and occupational health service, shall be marketable and constitute a limited share of the total remuneration. Premiums and other costs associated with such benefits may amount to a maximum of 15 per cent of the fixed annual salary.

Termination of employment

A mutual notice period of 12 months applies between the company and the managing director. In the event of the company's termination of the managing director's employment agreement, severance pay may be payable with an amount corresponding to a maximum of 12 months' fixed salary. The severance pay is not deducted against other income. No severance pay is payable in case of the managing director's own termination. A mutual notice period of six months applies between the company and other senior executives.

Additionally, remuneration may be paid for non-compete undertakings. Such remuneration shall compensate for loss of income and shall only be paid in so far as the previously employed executive is not entitled to severance pay. The remuneration shall be based on the fixed salary at the time of termination of employment and amount to not more than 60 per cent of the fixed salary at the time of termination of employment, unless otherwise provided by mandatory collective agreement provisions, and be paid during the time the non-compete undertaking applies, which shall be not more than 12 month following termination of employment.

Fees to board members

Railcare's board members elected by the general meeting may, in specific cases and for limited time, be remunerated for services beyond board work within their respective areas of competence. A fee on market terms for these services (including services rendered by a company wholly owned by a board member) shall be paid, provided that such services contribute to the implementation of Railcare's business strategy and safeguarding of the long-term interests, including its such consultant's fee may, for each board member. in no case exceed the annual directors fee.

Salary and employment conditions for employees

In the preparation of the board of directors' proposal of these remuneration guidelines, the salary and employment conditions of the company's employees have been taken into account by the inclusion of information on the employees' total income, the components of the remuneration and the remunerations increase and growth rate over time, in the remuneration committee's and the board of directors' basis of decision when evaluating whether the guidelines and the limitations set out herein are reasonable.

Preparation and decision-making process

The board of directors has resolved to establish a remuneration committee's duties include preparing principles for remuneration to senior executives and the board of director's decision to propose guidelines for remuneration to senior executives. The board of directors shall prepare a proposal for new guidelines at least every fourth year and submit the proposal to the annual general meeting for resolution. The guidelines shall be in force until new guidelines have been adopted by the general meeting. The remuneration committee shall also monitor and evaluate programs for variable remuneration to senior executives, the application of the guidelines for remuneration to senior executives as well as the current remuneration structures and compensation levels in the company. Remuneration to the managing director shall be decided by the board of directors in line with approved policies following preparation and recommendation by the remuneration committee. Remuneration to other senior executives shall be decided

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SHAREHOLDERS REQUEST FOR INFORMATION

DOCUMENTATION

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