The Board of Directors of Lannebo Fonder AB (“the Company”) resolved in December 2016 on an updated remuneration policy based on the Swedish Financial Supervisory Authority’s (Finansinspektionen) regulation regarding UCITS funds and managers of alternative investment funds, as well as the Swedish Code for Fund Management Companies. The European Securities and Markets Authority (ESMA) have issued guidelines on sound remuneration policies under the UCITS- and the AIFM Directive. The Fund Management Company has considered the aforementioned guidelines. The policy has been designed with consideration of the size of the Fund Company and internal organisation and the operations natures, extent and complexity.

The success of the Company is strongly correlated to the performance of the funds the Company manages. The remuneration policy adopted by the Board, which covers all employees of the Company, aims to motivate employees’ efforts in such a way that the funds exhibit a good risk-adjusted return over time. The remuneration policy will further promote sound and effective risk management and compliance and generally reward behaviour contributing to the Company’s long-term interests.

The integration of sustainability risks is a central part of the Company’s work, also when calculating remuneration to employees. Lannebo’s remuneration policy defines the risks that the Company analyzes in relation to the Company’s remuneration system. Sustainability risk is one of these risks. Based on the risk analysis that takes place, it is identified who are considered to be so called specially regulated personnel in the Company and which personnel categories that are considered to be able to significantly affect the risk level in the Company or the funds that the Company manages. By taking sustainability aspects into account when assessing remuneration, employees are encouraged to consider and work preventively against sustainability risks in the Company. The overall purpose is to promote a sound and effective risk management in terms of sustainability risks, while the remuneration structure should not encourage employees to take excessive risks in terms of sustainability risks. Specific assessment criteria for employees’ variable remuneration are also found in the remuneration policy, where participation in the Company’s sustainability work is highlighted as a criterion for several employees in the assessment of remuneration. This encourages employees to consider and work preventively against sustainability risks and not to take excessive risk. The policy is designed to be consistent with the business strategy, objectives and goals, values and interests of the Company and of the funds managed and of the unit holders.

The remuneration policy also aims to achieve a good balance between fixed and potential variable remuneration. The fixed remuneration shall be in line with levels prevailing in the market and sufficient so that the variable remuneration could be deemed to be zero. Variable remuneration is paid only to those employees who are considered to have contributed to the Company and, if applicable, the funds development beyond what would normally have been expected of the individual employee.

The variable remuneration to all employees is determined by Board resolution. The decision is based on result assessments and risk adjustments described below. The Chairman of the Board (“the Chairman”) prepares the resolution regarding variable compensation. During the preparatory work the Chairman obtains information from the relevant managers and statements from the appropriate control functions.

The overall financial performance of the Company is measured over a rolling five-year period. The average earnings over the period are calculated and represent the basis for the continuing result assessment and risk adjustment.

Next the earnings are adjusted with a fixed return requirement. The required return is determined taking into account a risk premium and the Board’s internal capital targets. In this way the Board takes into account the business risks that shareholders should be compensated for. If earnings after the adjustment are positive and variable remuneration has the potential to be payable as per above, the maximum amount of variable remuneration is determined according to an interval, providing the allocation for variable remuneration does not lead to negative earnings. The payment of variable compensation should never conflict with the capital targets and liquidity requirements that are regulated by the Company’s internal rules.

The Board determines the maximum amount to be allocated to the variable remuneration in a single year based on an assessment of the Company’s overall performance during the year.

After assessing the Company’s overall performance, an assessment is made of the department, unit, or the fund’s performance.

The employee’s performance is assessed at the next level. In general an employee’s variable compensation is determined on the basis of how the employee, over and above what would normally be expected, contributes to the development of the business. An employee’s variable remuneration may be set to zero. Both general and specific factors regarding the employee’s fulfilment of their responsibilities are considered. Qualitative and quantitative assessments are also made. Examples of general qualitative factors are customer service, compliance, administrative error rate and teamwork skills. For some employees more specific quantifiable targets are also considered such as net sales within marketing and sales. If possible the fulfilment of stated targets are also assessed over several years. An employee’s variable remuneration may not exceed three times the fixed remuneration. The remuneration policy also sets a limit on the total maximum variable remuneration for the Company in relation to the number of employees.

Any variable remuneration for the control functions are determined in accordance with the Swedish Financial Supervisory Authority regulation on the basis of objectives that are linked to the control functions, independent from the performance of the departments and units, as well as independent from the funds they oversee.

For specially regulated staff who receive variable remuneration 40 per cent is paid directly. With regard to what is stated below, the remaining 60 per cent is funded over the following four years or more. In this manner conformity is achieved with the funds recommended investment horizon of five years and the Company’s multi-year performance assessment by making the variable remuneration actual payment over a period of five calendar years.

The deferred remuneration payment will be allocated into the fund or funds closest associated with the employee’s duties. For fund managers that means the remuneration will be allocated into the fund or funds they are managing. If the relevant fund is closed to new subscriptions or if other obstacles occur, the remuneration will be allocated into the most similar fund. For employees who do not work with a specific fund, the remuneration will be allocated into a portfolio of other funds to mirror the entire Company´s operations and consequently all its managed funds’ and unit holders’ interests. The Board of Directors make the final decision on where the remuneration should be allocated.

With consideration to whether it is justifiable with respect to the Company’s financial situation and justifiable by the performance of the department, unit or the fund, and the employee’s performance, it may be decided that the deferred remuneration payment is paid in one fourth (quarterly instalments) over each of the following four years, provided that the employee remains employed. Before each interim payment a qualitative and/or quantitative assessment is carried out as described above. The first instalment payment may not be paid until one year has elapsed from the Board resolution regarding the variable remuneration.

The final amount to be paid is determined after five years earliest (vesting period plus deferment period), or by payment date, as this is dependent on the employee meeting the above conditions.

For variable remuneration to specially regulated staff, a part from deferment, there is a retention period. Of the variable remuneration that is paid out, direct or deferred, 50 per cent will be allocated into funds according to the split that the Board of Directors has decided on for the deferral period. During one year starting from the payment there are restrictions prohibiting the employee to sell or in other ways transfer or give away or pledge the unit holdings.

The Internal Audit function will on an annual basis review if the Fund Company’s remunerations are in line with this remuneration policy. The unit shall produce a written report to the Board of Directors with the results of the investigation. The Board of Directors is responsible for the remuneration policy being updated on a regular basis.

A hard copy of the information regarding Lannebo Fonder’s remuneration principles, which is published on the Company´s website, can be acquired at request from the Lannebo Fonder´s customer service free of charge.

The KIID shall comprise disclosures on that the fund management’s remuneration policy is available on the Company´s website and that a hard copy is made available on request free of charge.

Information will also be published in the prospectus and in the fund’s annual report.