Enclosures to the agenda for the 86th Ordinary General Meetingof Forbo Holding Ltd
Amendment of the Articles of Association to the Ordinance against Excessive Remuneration in
Listed Public Companies (OaER) and other amendments
Table of Contents

Board of Directors’ explanation of the proposed amendments of
the Articles of Association

Page 2

1.

Additional inalienable powers of the General Meeting

Page 2

2.

Regulation of the annual vote on the remunerationof the Board of Directors and the Executive Board

Page 2

3.

Principles of performance-based remuneration of the Executive Boardand the allocation of shares of the Company

Page 24.

Issuing electronic proxy rights and voting instructions
to the independent proxy

Page 3

5.

Regulation of external mandates held by members of theBoard of Directors and the Executive Board

Page 3

6.

Other amendments of the Articles of Association

Page 3

Enclosure A (to agenda item 6.1)

Page 4

Amendment of Clauses 4, 12 and 13 Paragraph 4 of the Articles of Association

Enclosure B (to agenda item 6.2)

Page 6

Amendment of the remaining provisions of the Articles of Association

Enclosure C (to agenda item 6.3)

Page 15

Editorial changes of the Articles of Association

Page 1 of 16

Board of Directors’ explanation of the proposed amendments of the Articles of Association
Dear shareholders,On 22 March 2013 the Swiss electorate voted in favour of the so-called Minder Initiative. On 20 November 2013,
the Swiss Federal Council issued the Ordinance against Excessive Remuneration in Listed Public Companies(OaER) based on Articles 95 and 197 of the Swiss constitution and put it into force as per 1 January 2014. There
are different grace periods for the implementation of the new provisions. The Articles of Association must be
adapted at the latest by the 2015 Ordinary General Meeting. The amendments of the Articles of Association
proposed here by the Board of Directors implement the new legal requirements in good time.
Below we have summarised the most important provisions in connection to the implementation of the new
ordinance by Forbo Holding Ltd.
1. Additional inalienable powers of the General Meeting
In future, the General Meeting will elect individually all members of the Board of Directors, the Chairman of theBoard of Directors, the members of the Remuneration Committee and the independent proxy on an annual
basis. The corresponding provisions are found in Clause 8 of the proposed new Articles of Association.
2. Regulation of the annual vote on the remunerationof the Board of Directors and the Executive Board
The Board of Directors proposes the following model for the binding annual vote on the remuneration of theBoard of Directors and the Executive Board: The total remuneration of the Board of Directors will be approvedin advance at the General Meeting for the financial year following the General Meeting. For the remunerationof the Executive Board, the Board of Directors proposes a two-stage procedure. The fixed remuneration of the
Executive Board will be approved in advance at the General Meeting for the following financial year and thevariable remuneration of the Executive Board will be submitted to the General Meeting afterwards for approval.
The corresponding provisions are found in Clause 24 of the proposed new Articles of Association.
At this year’s General Meeting, the statutory basis for this voting model is to be created. The first votes on
remuneration following this model shall take place during the 2015 Ordinary General Meeting.
3. Principles of performance-based remuneration of the Executive Boardand the allocation of shares of the Company
The new provisions in the OaER also state that the Company must anchor the principles of the performancebased remuneration as well as the allocation of shares of the Company in the Articles of Association.
As members of the Board of Directors only receive a fixed remuneration, statements here only affect the
Executive Board. The remuneration of the Executive Board is comprised of a fixed as well as a variable
component. The variable remuneration of the Executive Board consists on the one hand of a performancebased remuneration, which can amount to a maximum of 200% of the fixed part, and on the other hand of theallocation of shares of the Company under participation schemes. The value of the shares awarded under aparticipation scheme may not exceed 50% of the fixed part. The corresponding provisions are found in
Clause 26 of the proposed new Articles of Association.

Page 2 of 16

4. Isssuing electro
onic proxy rights and votting instructtions
too the indepen
ndent proxy
Another neew provision is that shareh
holders may isssue proxy rig
ghts and votin
ng instructionns to the inde
ependent
proxy electtronically. App
propriate provisions for thiis are to be en
ntered into th
he Articles of Association. The
T
correspondding provisionns are found in
i Clause 12 oof the propossed new Articles of Associaation.
5. Re
egulation of external mandates held by memberrs of theBooard of Direcctors and thee Executive B
Board
The statutees now also coontain provisions concern ing the numbber of mandates that a meember of the Board of
Directors oor the Executivve Board mayy hold outsidee the Forbo Group.
G
The Board of Directoors proposes that nomember off the Board off Directors should hold moore than five mandatesmin otherolisted coompanies and no morethan twentty mandates in non-listed companies,cwwhich are to beb entered in the commerccial register oro acorrespondding foreign register.
r
For membeers of the Exeecutive Board,, the Board off Directors pro
oposes a corresponding lim
mitation of twwomandates iin other listed
d companies and seven maandates in no
on-listed companies, wherre all external mandates
are to be ap
pproved in ad
dvance by thee Board of Dirrectors.
The corresp
ponding provvisions are fou
und in Clausee 22 of the pro
oposed new Articles
Aof Asssociation.
6. Otther amendm
ments of thee Articles of A
Association
Finally, the Board of Direectors uses thhis partial revission to propo
ose further ammendments too the Articles of
Associationn, editorial changes and chhanges due too changes in accounting and stock exchhange legislation.
The complete version ofo the current as well as thee revised Articles of Association can bee downloadedd from our
website at http://www.fforbo.com/en
n/Investor-Reelations/Ordinnary-General--Meeting/.
ding Ltd
Forbo Hold
On behalf oof the Board ofo Directors

Gnägi
Dr. Albert G
ChairmanPage 3 of 16

Enclosure A
Agenda item 6.1:

Amendment of Clauses 4, 12 and 13 Paragraph 4 of the Articles of Association

The adoption of this agenda item requires according to Clause 13 Paragraph 4 of the current Articles of
Association a qualified majority of two thirds of the shares represented as well as the absolute majority ofthe share par values represented.

CURRENT VERSIONREVISED VERSION

Clause 4

Clause 41

1

The Company holds a share register containing the names
and addresses of the holders or beneficiaries of registeredshares. Relative to the Company, only those persons
registered in the share register will be deemed to beregistered shareholders or beneficiaries. The Company must
be notified if a shareholder changes his address or registeredoffice. As long as such notice is not received, allcorrespondence will be sent to the address shown in theshare register.

1

The status of registration in the share register on the fourth
day prior to the General Meeting will be the determining
factor for attendance and voting rights.

2

2

3

[Wording unchanged]

The restriction on registration under paragraph 3 of thisClause will also apply to shares acquired or subscribed for by
way of the exercise of a subscription, option or conversion
right.

4

5[Wording unchanged]

Legal entities and partnerships or other associations or joint
property relationships linked together by capital or votes, bycommon directorships or otherwise, as well as natural
persons or legal entities or partnerships acting in aconcerted manner with a view to avoiding the conditions
governing the limits of holdings or nominees (in particularacting as a syndicate) will be deemed to be a single entity or
nominee within the meaning of paragraph 5 of this Clause.

6

The Company holds a share register containing the names
and addresses of the holders or beneficiaries of registeredshares. Relative to the Company, only those persons
registered in the share register will be deemed to beregistered shareholders or beneficiaries. The Company must
be notified if a shareholder changes his address or registeredoffice. As long as such notice is not received, allcorrespondence will be sent to the address shown in theshare register.

The status of registration in the share register on the fourth
day prior to the General Meeting will be the determining
factor for attendance and voting rights.
32[Wording unchanged]

The restriction on registration under pParagraph 23 of thisClause will also apply to shares acquired or subscribed for by
43

way of the exercise of a subscription, option or conversion
right.
54[Wording unchanged]

65

Legal entities and partnerships or other associations or
joint property relationships linked together by capital orvotes, by common directorships or otherwise, as well as
natural persons or legal entities or partnerships acting in aconcerted manner with a view to avoiding the conditions
governing the limits of holdings or nominees (in particularacting as a syndicate) will be deemed to be a single entity or
nominee within the meaning of pParagraph 4 5 of thisClause.

[Wording unchanged]

76[Wording unchanged]

8[Wording unchanged]

87[Wording unchanged]

1

Please note that this Paragraph is also subject to editorial changes in accordance with agenda item 6.3 (Enclosure C).

7

Page 4 of 16

Enclosure A (continued)
Agenda item 6.1:

Amendment of Clauses 4, 12 and 13 Paragraph 4 of the Articles of Association

CURRENT VERSIONREVISED VERSION

Clause 12

Clause 121[Wording unchanged]

1[Wording unchanged]

In the invitation to the General Meeting, the Board of
Directors shall state the record date by which shareholders
must be registered in the share register to be eligible toparticipate and vote at the General Meeting.
2

Every shareholder may be represented by anothershareholder. If the representative is not a statutory
representative, he must be identified by a written proxy.

2

Every shareholder may be represented by its statutory
representative or another shareholder. If the representative is23

not a statutory representative, he must be identified by awritten proxy.

The shareholder can also be represented by the
independent proxy elected by the General Meeting on anannual basis, whereby proxies and voting instructions canalso be issued electronically to the independent proxy. If thepost of the independent proxy is vacant, the Board of
Directors appoints one for the next General Meeting.
4

The Board of Directors establishes the requirements anddetails regarding issuing written and electronic proxies andvoting instructions. The Board of Directors can also waive a
qualified electronic signature for electronic proxies.
5

Clause 13

Clause 132[Wording of Paragraphs 1 to 3 remain unchanged][Wording of Paragraphs 1 to 3 remain unchanged]

Resolutions on the variation and removal of clauses in the
Articles of Association relating to a change of registeredoffice of the Company (Clause 1), the conversion ofregistered shares to bearer shares (Clause 3 paragraph 2),
registration of registered shares (Clause 4), representation ofshares at the General Meeting (Clause 12), variation of theseclauses of the Articles of Association (Clause 13 paragraph 4),
the winding up or merger of the Company, as well as allother important resolutions within the meaning of Article
704 OR must always be passed by a majority of two thirds ofthe voting shares represented at the General Meeting as well
as by an absolute majority of the share par values
represented.

4

4

2

Resolutions on the variation and removal of clauses in the
Articles of Association relating to a change of registeredoffice of the Company (Clause 1), the conversion ofregistered shares to bearer shares (Clause 3 paragraph 2),
registration of registered shares (Clause 4), representation ofshares at the General Meeting (Clause 12), variation of theseclauses of the Articles of Association (Clause 13 paragraph 4),
the winding up or merger of the Company, as well as allother important resolutions within the meaning of Article
704 ORCO must always be passed by a majority of two thirdsof the voting shares represented at the General Meeting aswell as by an absolute majority of the share par values
represented.

Please note that this Paragraph is also subject to other amendments in accordance with agenda items 6.2 (Enclosure B) and 6.3 (Enclosure C).

Page 5 of 16

Enclosure B
Agenda item 6.2:

Amendment of the remaining provisions of the Articles of Association

The adoption of this agenda item requires according to Clause 13 Paragraph 2 of the current Articles of
Association an absolute majority of the shares represented.

CURRENT VERSIONREVISED VERSION

Clause 8

Clause 8[Wording apart from the following modifications
unchanged][Wording apart from the following modifications
unchanged]

2. Election and removal of members of the Board of
Directors, and the company and Group auditors;

2. Election and removal of the Chairman of the Board of
Directors, the members of the Board of Directors, themembers of the Remuneration Committee, and thestatutorycompany and Group auditors and the independent
proxy;

3. Approval of the management report and the GroupAccounts;
3. Approval of the Annual Report, the Group Accounts andthe Annual Accounts and passing resolutions relating to the
distribution of the balance sheet profits, in particular thesetting of dividends and directors’ emoluments;

34. Approval of the Annual Report, the Group Accounts andthe Annual Accounts and passing resolutions relating to the
distribution of the balance sheet profits, in particular thesetting of dividends and directors’ emoluments;

5. Voting on the remuneration of the Board of Directors andthe Executive Board as per Clause 24;
4. Discharge of the members of the Board of Directors;

46. Discharge of the members of the Board of Directors andthe Executive Board;

Clause 9

Clause 93

The Ordinary General Meeting will take place annually
within six months of the end of the financial year. The
Annual Report and the Auditors Report must be madeavailable for inspection by the shareholders at the registeredoffice of the Company at least 20 days prior to the Ordinary
General Meeting. The availability of the reports should bereferred to in the notice of the General Meeting.

The Ordinary General Meeting will take place annually
within six months of the end of the financial year. The
Annual Report, the Remuneration Report including the Audit
Certificate and the Auditors Report must be made available
for inspection by the shareholders at the registered office of
the Company at least 20 days prior to the Ordinary General
Meeting. The availability of the reports should be referred toin the notice of the General Meeting.

1

1

2

[Wording unchanged]

3

Please note that this Paragraph is also subject to editorial changes in accordance with agenda item 6.3 (Enclosure C).

2[Wording unchanged]

Page 6 of 16

Enclosure B (continued)
Agenda item 6.2:

Amendment of the remaining provisions of the Articles of Association

CURRENT VERSIONREVISED VERSION

Clause 10

Clause 1041[Wording unchanged]

The General Meeting will be called by way of a letter to theregistered shareholders and publication in the Swiss Official
Gazette of Commerce. Notice of the meeting must be given
at least 20 days in advance.

2

1[Wording unchanged]

The General Meeting will be called by way of a one-timeletter to the registered shareholders and publication in the
Swiss Official Gazette of Commerce at least 20 days before
the day of the meeting. Notice of the meeting must be
given at least 20 days in advance. The convocation can also
occur via non-registered letter to the addresses entered in
the share register or, at the request of the registeredshareholders, electronically.
2

3[Wording unchanged]

3[Wording unchanged]

4[Wording unchanged]

4[Wording unchanged]

Clause 13

Clause 13[yet non-existent]

4

Clause 14

Clause 141[Wording unchanged]

Resolutions of the General Meeting on the remuneration of
the Board of Directors and the Executive Board must,
differently from Paragraph 2, be passed by an absolutemajority of the votes cast. Abstentions, blank and invalid
votes are thereby considered to have not been cast.

1

2

Votes and elections will be held either openly (on a show ofhands), secretly or electronically. In principle, votes andelections will be open, unless the General Meeting resolves
to hold them secretly or electronically or if the Chairman so
decides.

2

The Chairman may order an open election or a vote to berepeated either secretly or electronically if, in his mind, there
is any doubt about the result of the vote. In that event, theinitial open election or vote will be deemed not to havetaken place.

3

3

4

[Wording unchanged]

Votes and elections will be held either openly (on a show ofhands), secretly or electronically. In principle, votes andelections will be held electronicallyopen, unless the General
Meeting resolves to hold them secretly or openelectronicallyor if the Chairman so decides.
The Chairman may order an open election or a vote to berepeated either secretly or electronically if, in his mind, there
is any doubt about the result of the vote. In that event, theinitial open election or vote will be deemed not to havetaken place.

Please note that this Paragraph is also subject to editorial changes in accordance with agenda item 6.3 (Enclosure C).

Page 7 of 16

Enclosure B (continued)
Agenda item 6.2:

Amendment of the remaining provisions of the Articles of Association

CURRENT VERSIONREVISED VERSION

Clause 15

Clause 15

1[Wording unchanged]

1[Wording unchanged]

Members of the Board of Directors will remain in office for aperiod of three years. One year is understood to be theperiod between two Annual General Meetings. Upon firstelection, the period in office of each member will be soarranged that around one third of all the members of theBoard of Directors will be required to stand for re-election
every year. The Chairman of the Board of Directors as well as
the members of the Board of Directors are elected by theGeneral Meeting on an annual and individual basis. The termof office of the members of the Board of Directors ends ineach case with the conclusion of the next Ordinary General
Meeting. Re-election is permitted.

2

Members of the Board of Directors will remain in office for aperiod of three years. One year is understood to be theperiod between two Annual General Meetings. Upon firstelection, the period in office of each member will be soarranged that around one third of all the members of theBoard of Directors will be required to stand for re-election
every year.

23

Members who are newly elected as replacements during
the course of a period of office will be elected for the periodof the member they replace.

3

Members who are newly elected as replacements during
the course of a period of office will be elected for the periodof the member they replace.If the position of the Chairman
is vacant, the Board of Directors appoints a new Chairman
from among the members of the Board of Directors for theremaining term of office.

Clause 16

Clause 16

1

From among its members, the Board of Directors will
appoint a Chairman, a Vice-Chairman and a Secretary. The
latter need not be a member of the Board of Directors.

1[Wording of Clauses 2 to 7 unchanged][Wording of Clauses 2 to 7 unchanged]

Clause 17

Clause 175

1[Wording unchanged]

The Board of Directors may assign the management of theCompany or individual parts thereof, as well as the external
representation of the Company to one or more persons,members of the Board of Directors or third parties, who neednot be shareholders. It will issue the rules of organisation
and will stipulate the corresponding contractual
relationships.

2

5

From among its members, the Board of Directors will
appoint a Chairman, aone or several Vice-Chairmaen and a
Secretary. The latterSectretary need not be a member of theBoard of Directors.

1[Wording unchanged]

The Board of Directors may assign the management of theCompany or individual parts thereof, as well as the external
representation of the Company to one or more persons,individual members of the Board of Directors or to othernatural personsthird parties, who need not be shareholders.
2

The asset management may also be assigned to legal
entities. It will issue the rules of organisation and will

stipulate the corresponding contractual relationships.

Please note that this Paragraph is also subject to editorial changes in accordance with agenda item 6.3 (Enclosure C).

Page 8 of 16

Enclosure B (continued)
Agenda item 6.2:

Amendment of the remaining provisions of the Articles of Association

CURRENT VERSIONREVISED VERSION

Clause 18

Clause 186[Wording apart from the following modifications
unchanged][Wording apart from the following modifications
unchanged]

7. Preparation of the Remuneration Report;
8. Passing resolutions on the subsequent payment ofcontributions on shares which are not fully liberated;

8. Passing resolutions on the subsequent payment of

9. Passing resolutions on the establishment of capitalincreases and the associated amendments to the Articles of
Association.

9. Passing resolutions on the establishment of capital

3

From amongst its members the Board of Directors may
appoint one or more committees to deal with the
preparation and execution of its resolutions or with thesupervision of specific commercial operations. The Board of
Directors will ensure appropriate reporting.

3

4

The Board of Directors will decide on the remuneration ofits members and is entitled to set fixed indemnities as well as
special fees for extraordinary claims.

4[yet non-existent]

Clause 18 Remuneration Committee

contributions on shares which are not fully liberated;

increases and the associated amendments to the Articles of
Association.
From amongst its members the Board of Directors may
appoint one or more other committees to deal with the
preparation and execution of its resolutions or with thesupervision of specific commercial operations. The Board of
Directors will ensure appropriate reporting.

The Board of Directors will decide on the remuneration ofits members and is entitled to set fixed indemnities as well as
special fees for extraordinary claims.

The Remuneration Committee consists of at least two
members of the Board of Directors.
1

The members of the Remuneration Committee are electedby the General Meeting on an annual and individual basis.
The term of office of the members of the Remuneration
Committee ends in each case with the conclusion of thenext Ordinary General Meeting. Re-election is permitted.
2

If the Remuneration Committee is not at full capacity, theBoard of Directors appoints the missing members of theRemuneration Committee from among its members for theremaining term of office.
3

6

Please note that this Paragraph is also subject to editorial changes in accordance with agenda item 6.3 (Enclosure C).

Page 9 of 16

Enclosure B (continued)
Agenda item 6.2:
CURRENT VERSION

Amendment of the remaining provisions of the Articles of Association
REVISED VERSIONThe Remuneration Committee supports the Board of
Directors in determining the principles for the remuneration
policy and in determining the remuneration for themembers of the Board of Directors as well as the Executive
Board in the framework of the overall remuneration amountapproved by the General Meeting. It supports the Board of
Directors in designing participation schemes and in fulfilling
all other tasks in the area of remuneration. The
Remuneration Committee develops appropriate
recommendations for the attention of the Board of Directors.
The Board of Directors may delegate other individual tasks
and powers to the Remuneration Committee.
4

The Board of Directors appoints the Chairman of theRemuneration Committee and regulates all other matters ina separate set of regulations.
5[yet non-existent]

Clause 21 Contracts regarding remuneration
The employment contracts of the members of the Executive
Board or of the Board of Directors, and other contracts
regarding their remuneration, may have a term of a
maximum of 12 months, or be valid indefinitely with a notice
period of a maximum of 12 months.

[yet non-existent]

Clause 22 Mandates outside the Forbo Group
Members of the Board of Directors are permitted to hold amaximum of five mandates in listed legal entities and twenty
mandates in non-listed legal entities.
1

Members of the Executive Board are permitted to hold amaximum of two mandates in listed legal entities and sevenmandates in non-listed legal entities. Members of the
Executive Board require the advance consent of the Board of
Directors before accepting any mandates.
2

Mandates in the most senior management oradministration bodies of legal entities that require entry into
the commercial register or comparable foreign registers, andwhich are not part of the Forbo Group, is considered amandate in the sense of this Clause. Mandates in companies
that are associated with one another outside the ForboGroup are in each case viewed as one mandate.
3

Page 10 of 16

Enclosure B (continued)
Agenda item 6.2:

Amendment of the remaining provisions of the Articles of Association

CURRENT VERSIONREVISED VERSION[yet non-existent]

Clause 24 Approval of the remuneration
The General Meeting approves, on an annual basis,
separately, and with binding effect, the entire amount of the
maximum fixed remuneration to be paid to the Board of
Directors for the financial year that follows the General
Meeting.
1

The General Meeting approves, on an annual basis,
separately, and with binding affect, the entire amount of the
maximum fixed remuneration to be paid to the Executive
Board for the financial year following the General Meetingand the amount of the variable remuneration to be paid to
the Executive Board for the financial year preceding theGeneral Meeting.
2

The Board of Directors may, in deviation from the above
Paragraphs, also propose the General Meeting the approvalof the entire amount of fixed and variable remuneration. It
may also propose the approval of the remuneration for
periods other than those defined in the previous Paragraphs.
3

If the General Meeting does not accept a proposal of theBoard of Directors for the approval of the remuneration inaccordance with the previous Paragraphs, the Board of
Directors is entitled to, on the occasion of the same General
Meeting make new proposal, or to adjourn the voteregarding the approval of the remuneration to an
Extraordinary or the next Ordinary General Meeting. Until theapproval of the fixed remuneration by the General Meeting,the Board of Directors may pay out the remuneration
subject to the approval.
4[yet non-existent]

Clause 25 Additional amount for members of the Executive
Board
The additional amount for the remuneration of members of
the Executive Board, which are named in accordance withthe vote regarding remuneration as per Clause 24, is a
maximum of 40% of the entire amount of the remuneration
to be paid to the Executive Board, approved in advance by
the General Meeting.

Page 11 of 16

Enclosure B (continued)
Agenda item 6.2:

Amendment of the remaining provisions of the Articles of Association

CURRENT VERSIONREVISED VERSION[yet non-existent]

Clause 26 Principles regarding fixed and performancebased remuneration and the allocation of shares of theCompany
The members of the Board of Directors receive a fixed
remuneration, the amount of which is graded in accordancewith each individual's position as Chairman or member, as
well as on the basis of memberships in committees of theBoard of Directors. Remuneration can be paid out to themembers of the Board of Directors partially or wholly in theform of restricted shares of the Company.
1

The members of the Executive Board receive a fixed andvariable remuneration. The variable remuneration iscomposed of the performance-based remuneration("bonus") and of the allocation of shares of the Company.
The bonus is associated with the achievement of theindividual (qualitative) objectives of the respective Executive
Board member, as well as of the financial (quantitative)
objectives of the Company, whereby the financial goals may
relate to Group and/or Divisional objectives, depending on
the role and responsibility of the respective member of the
Executive Board. The Board of Directors determines andweights the individual and financial objectives. The bonus
may be a maximum of 200% of the fixed remuneration of
the respective member of the Executive Board. The fixed or
performance-based remuneration can be paid out to themembers of the Executive Board partially or wholly in theform of restricted shares of the Company. The bonus can, in
specific cases such as the termination of the employment
contract, be adjusted with the assumption that theobjectives determined by the Board of Directors have beenachieved in full.
2

If the fixed or performance-based remuneration is not paidout partially or wholly in cash, but in the form of shares of
the Company, the Board of Directors defines factors that aredecisive for the valuation of the shares issued, such as thetime and method of valuation as well as the duration of thelock-up period associated with them. The duration of thelock-up period is generally three to five years. The Board of
Directors may arrange for the lock-up periods being omitted
entirely or partially if certain events occur (such as a changeof control, termination of the employment contract
respectively mandate, retirement or death).
3

Page 12 of 16

Enclosure B (continued)
Agenda item 6.2:
CURRENT VERSION

Amendment of the remaining provisions of the Articles of Association
REVISED VERSIONThe Company can contribute to management
commitment and motivation to ensure sustainable
company success by awarding shares of the Company tomembers of the Executive Board under participation
schemes as part of their variable remuneration in addition to
the performance-based components. The value of theshares awarded may not exceed half of the fixed
remuneration of the relevant member of the Executive
Board. The corresponding performance incentives can beshort-, medium- or long-term. The Board of Directors canprovide for a lock-up period of between three and five years
and/or conditions precedent for shares awarded underparticipation schemes. Lock-up periods and conditions
precedent can fully or partially cease to apply if certain
events occur (such as change of control, termination of theemployment contract, retirement or death). The value of theshares awarded is appraised at the time the shares areawarded as per the valuation method stipulated by the
Board of Directors.
4

In accordance with the provisions above, the remuneration
may also be paid out wholly or partially from directly and/or
indirectly held subsidiaries.
5

Taking into account the above Paragraphs, the Board of
Directors regulates all details of performance-based
remuneration and the awarding of shares of the Company
under participation schemes in a separate set of regulations.
6[yet non-existent]

Clause 27 Loans, credits and benefits beyond occupational
pensions
The Company may pay members of the Executive Board
loans, credits and benefits beyond occupational pensions up
to a maximum amount equal to the annual remuneration of
the relevant member.
1

The Board of Directors shall, as far as necessary, adopt theprovisions on the regulation of granting loans, credits andbenefits beyond occupational pensions.
2Page 13 of 16

Enclosure B (continued)
Agenda item 6.2:

Amendment of the remaining provisions of the Articles of Association

CURRENT VERSIONREVISED VERSION

Clause 20

Clause 207

1[Wording unchanged]

1[Wording unchanged]

The Annual Accounts, which will comprise the Profit andLoss Account, the Balance Sheet and the Appendix, as wellas the Group Accounts, will be prepared in accordance withthe provisions of the Swiss Code of Obligations and inparticular Article 662a et seqq. thereof, and also inaccordance with the generally acknowledged accounting
principles.

2

Titel VI BekanntmachungenSection VI Notices

Clause 25

Clause 25821[Wording unchanged]

Notices to bearer shareholders will be given by publicationin the Swiss Official Gazette of Commerce. Notices toregistered shareholders will be given by ordinary letter tothe address shown in the share register, to the extent noprovision is made by law for another form of notice.
2

The Annual Accounts, which will comprise the Profit andLoss Account, the Balance Sheet, the cash flow statement
and the Appendix, as well as the Group Accounts as well as
the management report, will be prepared in accordancewith the provisions of the Swiss Code of Obligations and inparticular Article 662a et seqq. thereof, and also inaccordance with the generally acknowledged accounting
principles.

1[Wording unchanged]

Notices to bearer shareholders will be given by publicationin the Swiss Official Gazette of Commerceofficial body of2

publication of the Company, to the extent no provision ismade by law for another form of notice. Written nNotices toregisteredthe shareholders will be given by ordinary letter tothe address shown in the share register, to the extent noprovision is made by law for another form of notice.
Notices to individual shareholders can also occur
electronically if their written permission has been obtained.
3

Titel VII Öffentliche Kaufangebote

Section VII Public Bids

Clause 26

Clause 26

1

The shareholders of the Company are subject to theprovisions of Federal law governing stock exchanges andtrading in securities (BEHG) of March 24, 1995. The minimum
price provision in paragraph 4 of Article 32 BEHG will be
modified as follows:1

The price of the offer must be at least consistent with thestock exchange price. However, it may not be less than thehighest price paid by the offeror for equity in the Company
in the last 12 months.

2

2

7/8

The shareholders of the Company are subject to theprovisions of Federal law governing stock exchanges andtrading in securities (BEHG) of March 24, 1995. The minimum
price provision in paragraph 4 of Article 32 BEHG will be
modified as follows:
The price of the offer must be at least consistent with thestock exchange price. However, it may not be less than thehighest price paid by the offeror for equity in the Company
in the last 12 months.

Please note that this Paragraph is also subject to editorial changes in accordance with agenda item 6.3 (Enclosure C).

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Enclosure C
Agenda item 6.3:

Editorial changes of the Articles of Association

The adoption of this agenda item requires according to Clause 13 Paragraph 2 of the current Articles of
Association an absolute majority of the shares represented.
Part 1: Redrafts
CURRENT VERSIONREVISED VERSION

Clause 6

Clause 62

Shareholders’ subscriptions – with the exception ofshareholder options – is excluded. Individual holders ofoption and conversion rights are entitled to subscribe for the
new shares. Registration of the new registered shares in theshare register in connection with the exercise of option orconversion rights, is subject to the limitations set out inClause 4 above.

2

Clause 11

Clause 11

The General Meeting will be presided over by the
Chairman of the Board of Directors. In his absence, themeeting will be chaired by the Vice-Chairman or anothermember of the Board of Directors.

1

1

Shareholders’ subscriptions – with the exception ofshareholder options – is excluded. Individual holders ofoption and conversion rights are entitled to subscribe for the
new shares. Registration of the new registered shares in theshare register in connection with the exercise of option orconversion rights, is subject to the limitations set out inClause 64 above.

The General Meeting will be presided over by the
Chairman of the Board of Directors. In his absence, themeeting will be chaired by the Vice-Chairman or anothermember of the Board of Directors.

Part 2: Rearrangements
CURRENT VERSIONREVISED VERSION

Clause 3 Paragraph 2

Clause 5 Paragraph 8

Clause 4

Clause 6

Clause 6

Clause 4

Clause 8 Cypher 5Clause 8 Cypher 7Clause 9 Paragraph 1 and 2

Clause 9 Paragraph 2 and 3

Clause 10 Paragraph 1
Clause 10 Paragraph 2 and Paragraph 3 Phrase 1
Clause 10 Paragraph 3 Phrase 2
Clause 10 Paragraph 4

Clause 9 Paragraph 1
Clause 10 Paragraph 1 and 2
Clause 9 Paragraph 4
Clause 10 Paragraph 3

Clause 13 Paragraph 4

Clause 13 Paragraph 5

Clause 17 Paragraph 2

Clause 20

Clause 18 Paragraph 1 and 2
Clause 18 Paragraph 1 Cypher 7Clause 18 Paragraph 3

Clause 17 Paragraph 2 and 3
Clause 17 Paragraph 2 Cypher 8Clause 19

Clause 19

Clause 23

Clause 20

Clause 28

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Enclosure C (continued)
Agenda item 6.3:

Editorial changes of the Articles of Association

Part 2: Rearrangements (continued)
CURRENT VERSIONREVISED VERSION

Clause 21

Clause 29 Paragraph 1

Clause 22

Clause 29 Paragraph 2

Clause 23

Clause 30

Clause 24

Clause 31

Clause 25

Clause 32

Part 3: Modification of section headers
CURRENT VERSIONREVISED VERSION

I.

Company, Purpose, Registered Office and Duration

I.

II.

EquityIII. Company Authorities

IV. Annual Accounts, Distribution of Profits, Reserves
V.

Winding-up and Liquidation

VI. Notices
VII. Public Bids

Company, Purpose, Registered Office and Duration
Principles
II. Equity Share capital, shares and share registerIII. Company Authorities Organisation of the Company
IV. Approval of remuneration as well as principles of
remuneration, participation schemes and loans
IVV. Annual Accounts, Annual Report, Distribution of Profits,
Reserves

VVI. Winding-up and Liquidation Final provisions
VI. Notices
VII. Public Bids

Part 4: Insertion of titles
Clause 1

Business name, registered office andduration
Clause 2 Purpose
Clause 3 Share capital
Clause 4 Conditional share capital
Clause 5 Shares
Clause 6 Share register, restrictions of registration
and Nominees
Clause 7 Governing bodies
Clause 8 Powers
Clause 9 Convocation and agenda items
Clause 10 Form of the convocation
Clause 11 Chairing of the Meeting
Clause 12 Eligibility and representation
Clause 13 Resolution and elections
Clause 14 Voting procedure
Clause 15 Composition, election and term of officeClause 16 Formation, meetings and resolution
Clause 17 Responsibilities

Clause 18 Remuneration Committee
Clause 19 Further committees of the Board of Directors
Clause 20 Delegation of the company management
Clause 21 Contracts regarding remuneration
Clause 22 Mandates outside the Forbo Group
Clause 23 The Statutory Auditor
Clause 24 Approval of the remuneration
Clause 25 Additional amount for members of the
Executive Board
Clause 26 Principles regarding fixed and performancebased remuneration and the allocation ofshares of the Company
Clause 27 Loans, credits and benefits beyond
occupational pensions
Clause 28 Financial year and Annual Report
Clause 29 Distribution of Profits
Clause 30 Reserves
Clause 31 Winding-up and Liquidation
Clause 32 Notices

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