Notice to the Annual General meeting in Mycronic AB (publ)
The shareholders in Mycronic AB (publ) are hereby given notice of the Annual General Meeting to be held on Wednesday 5 May 2021.
Due to the coronavirus, the Board of Directors has decided that the Annual General Meeting should be conducted without the physical presence of shareholders, representatives or third parties and that the shareholders before the meeting should be able to exercise their voting rights only by post. Information on the resolutions passed at the meeting will be disclosed on 5 May 2021, as soon as the outcome of the postal voting has been finally confirmed.
Since the Annual General Meeting will be conducted without the physical presence of shareholders, representatives or third parties, there will not be any speech by the CEO. However, a pre-recorded speech will be made available on the company’s website prior to the Annual General Meeting.
Registration and notification
Shareholders who wish to participate in the Annual General Meeting by postal voting must
- Be recorded in the share register kept by Euroclear Sweden AB on Tuesday 27 April 2021, and
- Give notice of their intention to participate no later than Tuesday 4 May 2021, by casting their postal votes in accordance with the instructions under the heading Postal voting below so that the postal voting form is received by Computershare no later than that day. Please note that the notification to the Annual General Meeting can only be made by postal voting.
For shareholders who have their shares registered through a bank or other nominee, the following applies in order to be entitled to participate in the meeting. In addition to giving notice of participation by submitting its postal vote, such shareholder must re-register its shares in its own name so that the shareholder is registered in the share register kept by Euroclear Sweden AB as of the record date, Tuesday 27 April 2021. Such registration may be temporary (so-called voting rights registration). Shareholders who wish to register their shares in their own names must, in accordance with the respective nominee´s routines, request that the nominee make such registration. Voting rights registration that have been requested by the shareholder at such time that the registration has been completed by the nominee no later than Thursday, 29 April 2021, will be taken into account in the preparation of the share register.
Postal Voting
The Board of Directors has decided that shareholders should be able to exercise their voting rights only by postal voting in accordance with section 22 of the Act (2020:198) on temporary exceptions to facilitate the execution of general meetings in companies and associations. A special form must be used for the postal vote. The form for postal voting is available on the company’s website www.mycronic.com. Completed and signed forms for postal voting can be sent by mail to Computershare AB, ”Mycronic’s Annual General Meeting”, Box 5267, 102 46 Stockholm, Sweden or by e-mail to info@computershare.se. Completed forms must be received by Computershare no later than 4 May 2021. Shareholders who are natural persons may also cast their votes electronically through verification with BankID via the company’s website www.mycronic.com. Such electronic votes must be submitted no later than 4 May 2021.
The Shareholders may not provide special instructions or conditions to the postal vote. If so, the entire postal vote is invalid. Further instructions or conditions can be found on the postal voting form.
Power of attorney
If the shareholder submit its postal vote by proxy, a written and dated power of attorney signed by the shareholder must be attached to the postal voting form. Proxy forms are available on the company’s website www.mycronic.com. If the shareholder is a legal person, a registration certificate or other authorization document must be attached to the form.
Shareholders’ right to receive information
The board of Directors and the President and CEO shall, if any shareholder so requests and the Board of Directors believes that it can be done without material harm to the company, provide information regarding circumstances that may affect the assessment of an item on the agenda. A request for such information shall be made in writing to the company no later than ten days prior to the Annual General Meeting, i.e. no later than 26 April 2021, at the address Mycronic AB (publ), Att: Investor Relations, Nytorpsvägen 9, 183 53 Täby, Sweden or by e-mail to helloir@mycronic.com. The questions and responses will be made available on the company’s website www.mycronic.com, and the company’s head office Nytorpsvägen 9, 183 53 Täby, no later than 30 April 2021. The information is also sent to shareholders who request it and state their address.
Proposed Agenda for the Annual General Meeting
1. Election of Chairman of the Annual General Meeting
2. Preparation and approval of the voting list
3. Approval of the agenda
4. Election of one or two persons who shall approve the minutes of the meeting
5. Consideration of whether the meeting has been duly convened
6. Presentation of annual report and auditor’s report as well as of the consolidated financial
statements and the auditor’s report for the group
7. Resolutions regarding the adoption of the income statement and the balance sheet as well as the
consolidated income statement and the consolidated balance sheet
8. Resolution regarding appropriation of the company’s profit or loss in accordance with the adopted balance sheet
9. Resolution regarding discharge from liability of members of the Board of Directors and the CEO
10. Resolution regarding number of Board members and deputy Board members and auditors
11. Determination of fees for the members of the Board of Directors and the auditors
12. Election of members of the Board of Directors and Chairman of the Board of Directors
13. Election of auditor
14. Resolution regarding approval of the remuneration report
15. The Board of Directors’ proposal regarding guidelines for remuneration to senior executives
16. Proposal regarding composition of nomination committee
17. The Board of Directors’ proposal on authorization of the Board of Directors to resolve to issue new shares
18. The Board of Directors’ proposal on authorization of the Board of Directors to resolve for the company to acquire the company’s own shares
19. The Board of Directors’ proposal regarding Long Term Incentive Program 2021 (LTIP 2021)
20. The Board of Directors’ proposal for resolution to amend the Articles of Association
This year’s nomination committee
The nomination committee for the 2021 Annual General Meeting is composed of Henrik Blomquist (Bure Equity), Per Trygg (SEB Fonder), Thomas Ehlin (Fjärde AP-fonden) and Patrik Tigerschiöld (Chairman of the Board).
Item 1: Election of Chairman of the Annual General Meeting
The nomination committee proposes that the Chairman of the Board, Patrik Tigerschiöld, or the person appointed by the Board of Directors if he has an impediment to attend, is elected Chairman of the Annual General Meeting and that Niklas Larsson, Wistrand Advokatbyrå, or the person appointed by the Board of Directors if he has an impediment to attend, is elected keeper of the minutes of the Annual General Meeting.
Item 2: Preparation and approval of the voting list
The voting list proposed for approval is the voting list drawn up by the Chairman at the Annual General Meeting on behalf of the company, based on the general meeting’s share register and advance votes received, as verified and recommended by the person approving the minutes.
Item 3: Approval of the agenda
The Board of Directors proposes that the agenda, which is included in this notice to the Annual General Meeting, be approved as the agenda at the Annual General Meeting.
Item 4: Election of one or two persons who shall approve the minutes of the meeting
It is proposed that one person is appointed to approve the minutes. Thomas Ehlin, representing Fjärde AP-fonden, or the person appointed by the Board of Directors if he has an impediment to attend, is proposed to be elected to approve the minutes of the Annual General Meeting together with the Chairman. The task of approving the minutes of the Annual general Meeting also includes verifying the voting list and that the advanced votes received are correct stated in the minutes of the Annual General Meeting.
Item 5: Consideration of whether the meeting has been duly convened
It is proposed that the general meeting approve the convening of the Annual General Meeting.
Item 8: Resolution regarding appropriation of the company’s profit or loss in accordance with the adopted balance sheet
The Board of Directors proposes an ordinary dividend for the financial year 2020 of SEK 3,00 per share. Record date is proposed to be 7 May 2021 and disbursement day is estimated to be 12 May 2021.
Item 10: Resolution regarding number of Board members and deputy Board members
The nomination committee proposes that the Board of Directors for the period running up until the end of the next Annual General Meeting shall be composed of six members with no deputy members and that one registered accounting firm is elected as auditor.
Item 11: Determination of fees for the members of the Board of Directors and the auditor
The nomination committee proposes a total remuneration to the Board of Directors amounting to SEK 2 755 000 for the period running until the end of the next Annual General Meeting. The nomination committee proposes a raise in remuneration to the Chairman of the Board to SEK 800 000, and a raise in remuneration to each of the five other members of the Board to SEK 320 000. Furthermore, the nomination committee proposes that the remuneration to the Chairman of the audit committee shall remain unchanged at SEK 100 000, and that the remuneration to each of the other members of the audit committee shall remain unchanged at SEK 50 000. In addition, the nomination committee proposes that the remuneration to the Chairman of the remuneration committee shall remain unchanged at SEK 75 000, and that the remuneration to each of the other members of the remuneration committee shall remain unchanged at SEK 40 000.
The nomination committee also proposes that the auditor’s fee for the period running until the end of the next Annual General Meeting is taken on current account.
Item 12: Election of members of the Board of Directors and Chairman of the Board of Directors
The nomination committee proposes re-election of the Board members Anna Belfrage, Katarina Bonde, Robert Larsson, Staffan Dahlström, Arun Bansal and Patrik Tigerschiöld. Patrik Tigerschiöld is proposed to be re-elected as chairman of the Board.
Item 13: Election of auditor
The nomination committee proposes re-election of Ernst & Young AB as auditor for the period
running until the end of the next Annual General Meeting. Ernst & Young has announced the Authorized Public Accountant Erik Sandström as responsible auditor.
Item 14: Presentation of the report regarding paid and outstanding compensation covered by the guidelines
The Board of Directors proposes that the Annual General Meeting resolves to approve the Board of Directors’ report regarding paid and outstanding compensation covered by the guidelines in accordance with Chapter 8, Section 53 a of the Swedish Companies Act.
Item 15: The Board of Directors’ proposal regarding guidelines for remuneration to senior executives
The following guidelines for remuneration to senior executives are applicable to remuneration agreed, and amendments to remuneration already agreed, after the adoption of the guidelines by the Annual General Meeting 2021. The guidelines cover remuneration to the Board of Directors, the CEO, the deputy CEO and other senior executives (the Executive Management), however, these guidelines do not apply to any remuneration decided or approved by the general meeting.
The Board of Directors shall be entitled to temporarily deviate from these guidelines, in whole or in part, if special reasons justify doing so in an individual case and such deviation is necessary in order to meet the company’s long-term interests and sustainability or to ensure the company’s financial viability. If such a deviation occurs, it must be reported in the remuneration report before the next Annual General Meeting. These guidelines are applicable from the Annual General Meeting 2021. An issue regarding deviation from the guidelines shall be prepared by the remuneration committee and decided by the Board of Directors.
The guidelines’ promotion of the company’s business strategy, long-term interest and sustainability
Mycronic is a global high-tech company that develops, manufactures and supplies market-leading production equipment with high requirements on precision and flexibility to the electronics industry. Mycronic has three priorities within the framework of the company’s long-term strategy. These are to consolidate the company’s strong position within the division Pattern Generators, increase or maintain profitability levels within the divisions High Flex, High Volume and Global Technologies and increase the company’s proximity to customers. The strategy also includes creating value through a focus on sustainability.
The Board of Directors considers that it is critical for the successful implementation of the company’s business strategy and safeguarding of its long-term interests, including its sustainability, is that the company is able to recruit and retain a highly competent management with capacity of achieving specified goals. To this end, it is necessary that the company can offer competitive remuneration to motivate senior executives to do their utmost. Variable cash remuneration covered by these guidelines shall be based on criteria that aim at promoting the company’s business strategy and long-term interests, including its sustainability, and where the fulfillment of the criteria is determined by the method set out below.
Forms of remuneration, etc.
The remuneration and other terms of employment for senior executives shall be based on market terms. The total remuneration may consist of fixed and variable remuneration, pension and certain other benefits.
Fixed remuneration
When determining the fixed remuneration for the CEO and other senior executives, the impact on the total remuneration shall be taken into account. The remuneration depends on the scope and complexity of the position in question and the individual’s performance from year to year. The fixed remuneration to senior executives, like other remuneration components, are subject to annual review by the remuneration committee, which takes into account external remuneration statistics to ensure that remuneration levels remain competitive. The fixed remuneration constitutes a maximum 65 percent of the total remuneration at full outcome of the short-term variable remuneration, excluding long-term variable remuneration.
Short-term variable remuneration
The remuneration is paid in accordance with goals achieved. The criteria, such as revenue or operating profit, contributes to the company’s business strategy, long-term interests and sustainability through clear links to the above-mentioned criteria and thus to the company’s long-term value creation. The fulfillment of the criteria is determined through the company’s audited annual accounts. The short-term variable remuneration can amount to a maximum of 110 percent of the fixed remuneration. The short-term variable remuneration may amount to a maximum of 55 percent of the total remuneration at full outcome, excluding long-term variable remuneration. Unless otherwise provided by mandatory law or obligations in applicable collective bargaining agreements, short-term variable remuneration shall not be pensionable. The outcome of the remuneration is prepared by the remuneration committee and determined by the Board of Directors in connection with the end of the qualification period. The remuneration is thereafter paid out. The company has no contractual right to recover the remuneration.
Long-term variable remuneration
Senior executives can be offered share-related or share price-related remuneration. An incentive program shall be intended to improve the participants’ commitment to the company’s development and shall be introduced on market-based terms. Resolutions on incentive programmes related to shares and share prices must be passed at the Annual General Meeting and are therefore not covered by these guidelines. Agreements exist, that has previously been entered into regarding variable remuneration for additional persons in the group management team that is linked to continued employment. In addition, the general meeting may – regardless of these guidelines – resolve on share-related or share price-related remuneration.
Other benefits
Pension
Senior executives employed in Sweden as of 2012 are normally covered by a premium-based ITP1-plan. In addition to the ITP-plan, a supplementary pension plan is applied. The retirement age for senior executives is normally 65 years. For senior executives who are not employed in Sweden, locally competitive pension plans and retirement ages are applied.
Other benefits
Other benefits, e.g. a company car and health care plans, are determined based on the basis that they must be competitive in the local market.
Other benefits constitute a maximum of 40 percent of the total remuneration at full outcome of the short-term variable remuneration, excluding long-term variable remuneration.
Special adaptation
Regarding employment conditions that are governed by rules other than Swedish, appropriate adjustments may be made in order to comply with such mandatory rules or local practice, whereby the overall purpose of these guidelines shall be met.
Notice of termination and severance pay
The senior executives’ employment or contractual agreements shall be valid until further notice or for a specified period of time. In the event of termination by the company, the notice period is twelve months for the CEO and the CEO is entitled to twelve months severance pay. For senior executives who are locally employed in Sweden, the mutual notice period is a maximum of six months. In the event of termination by the company, six months notice and six months severance pay apply. During notice period, the current employment contract runs with associated benefits. In cases where severance pay would be paid, no other benefits will be paid after the expiry of the notice period. For other senior executives who are locally employed outside of Sweden, there are other notice periods and agreements on severance pay.
Salary and terms of employment for employees
In preparing the Board of Directors’ proposal for these remuneration guidelines, the salaries and terms of employment for the company’s employees have been taken into account. Information about employees’ total remuneration, components of their remuneration, as well as increases in remuneration and increases over time have been obtained and have constituted a part of the remuneration committee’s and the Board of Directors’ decision basis in their evaluation of the fairness of the guidelines and the limitations arising from them.
The resolution process
The Board of Directors shall prepare a proposal for new guidelines when there is a need for significant changes to the guidelines, however at least every four years. The Board of Directors’ proposal is prepared by the remuneration committee. The chairman of the Board of Directors may chair the remuneration committee. In order to manage conflicts of interest, other members of the remuneration committee who are elected by the Annual General Meeting must be independent in relation to the company and the senior executives.
The remuneration committee shall, inter alia, monitor and evaluate the application of the guidelines for remuneration to senior executives decided by the Annual General Meeting. When the remuneration committee has prepared the proposal, it is submitted to the Board of Directors for decision. The CEO or other senior executives shall not be present while the Board of Directors addresses issues related to remuneration and passes resolutions about them, insofar as they are affected by the issues.
If the Annual General Meeting resolves not to adopt guidelines when there is a proposal for such, The Board of Directors shall submit a new proposal no later than at the next Annual General Meeting. In such cases, remuneration shall be paid in accordance with the current guidelines or, if no guidelines exist, in accordance with the company’s practice.
External advisors are used in the preparation of these matters when deemed necessary.
Review of the guidelines
A review of the guidelines for remuneration to senior executives has been made prior to the Annual General Meeting 2021 and the review has resulted in certain editorial changes as well as certain minor adjustments of, among other things, the relative share of the total remuneration represented by each form of remuneration. The changes are not expected to entail any significant change in the remuneration paid in accordance with the current guidelines.
Item 16: Proposal regarding composition of nomination committee
The nomination committee proposes that a new nomination committee for the 2022 Annual General Meeting is appointed by the Chairman of the Board – at the latest by the end of the third quarter of 2021 – contacting the three largest or otherwise known shareholders per 31 August, 2021. The term of office shall run until a new nomination committee commences its service.
The composition of the nomination committee shall be published no later than six months before the company’s Annual General Meeting.
The responsibility of the nomination committee regarding the 2022 Annual General Meeting includes proposing (i) chairman of the meeting, (ii) the number of Board members, (iii) election of members of the Board and Chairman of the Board and remuneration to Board members and the Chairman of the Board and remuneration to members of Board committees, (iv) election of auditor and remuneration to auditor and (v) the process for appointment of a new nomination committee.
The nomination committee proposes that the Annual General Meeting decides that the instruction to the nomination committee shall be the same as last year.
Item 17: The Board of Directors’ proposal on authorization of the Board of Directors to resolve to issue new shares
The Board of Directors proposes that the Annual General Meeting authorizes the Board of Directors up until the end of the 2022 Annual General Meeting, on one or several occasions, to resolve to issue new shares, with deviation from the shareholders’ preferential rights. Shares may be paid in kind, through set-off or with other conditions set forth in Chapter 13, Section 5, first paragraph item 6 in the Swedish Companies Act. The Board of Directors may otherwise set the terms of such share issuance. The authorization shall however not comprise a right for the Board to issue shares against cash payment and with deviation from the shareholders’ preferential rights. The issue price shall be determined on marketable grounds and the number of issued shares may not exceed ten percent of the total amount of outstanding shares in the company per the day of this notice.
The reason for the deviation from the shareholders’ preferential rights and the right to decide on payment through set-off, in kind or other condition as set forth in the Swedish Companies Act is to enable the company to issue shares in order to acquire shares, business or product rights.
Majority requirements
A valid resolution under item 17 above requires that shareholders representing not less than two-thirds (2/3) of the votes cast as well as the shares represented at the Annual General Meeting approve the resolution.
Item 18: The Board of Directors’ proposal on authorization of the Board of Directors to resolve for the company to acquire the company’s own shares
The Board of Directors shall be authorized, during the period until the next Annual General Meeting, to decide to acquire the company’s own shares in accordance with the following.
- Acquisition may only be made by a maximum of so many shares that, at any given time, the company’s own holdings do not exceed five percent of all shares in the company
- Acquisition of shares in the company may only be made on Nasdaq Stockholm (the “Exchange”)
- Acquisition of shares on the Exchange may only take place at a price within the price range recorded on the Exchange at any given time
- The payment for the shares shall be paid in cash
- The authorization may be used on one or several occasions up until the end of the 2022 Annual General Meeting
The purpose of the above authorizations to acquire shares is to enable delivery of shares to participants in LTIP 2021 (the introduction of a new long term incentive program, LTIP 2021, is subject to a separate resolution in item 19 in the notice for the 2021 Annual General Meeting) and to be able to continuously adjust the company’s capital structure to the company’s capital requirements.
Shares that have been acquired by the company and which have not been reserved in order to secure the company’s delivery of shares under LTIP 2021 are intended to be canceled following a resolution thereof at the 2022 Annual General Meeting.
Majority requirements
A valid resolution under item 18 above requires that shareholders representing not less than two-thirds (2/3) of the votes cast as well as the shares represented at the Annual General Meeting approve the resolution.
Item 19: The Board of Directors’ proposal regarding Long Term Incentive Program 2021 (LTIP 2021)
Mycronic’s Board of Directors proposes that the Annual General Meeting passes a resolution on the implementation of a Long Term Incentive Program 2021 (LTIP 2021). This proposal is divided into four items:
A. Terms of LTIP 2021
B. Transfer of the company’s own shares under LTIP 2021 and hedging activities
C. Hedging of LTIP 2021 via an equity swap agreement with a third party
D. Other matters related to LTIP 2021
A. Terms of LTIP 2021
A.1 Introduction
The Board wishes to establish a long-term incentive program for certain key employees in order to encourage personal long-term ownership of Mycronic shares as well as to increase and enhance its ability to recruit, retain and motivate employees. The Board therefore proposes that the Annual General Meeting resolves to implement a long-term performance share program 2021 ("LTIP 2021"). The intention is also to use LTIP 2021 to unite the interest of the employees with the interests of shareholders.
Participants may, after a qualifying period, receive allotments of Mycronic ordinary shares without consideration. The number of allotted shares will depend on the fulfilment of certain performance targets. The term of LTIP 2021 is more than three years.
A.2 Basic features of LTIP 2021
The LTIP 2021 will be directed towards certain key employees in the Mycronic Group. The participants are based in Sweden and other countries where the Mycronic Group is active. Each participant may be entitled, after a certain qualification period (defined below), provided continued employment during the entire period (except from “Good Leavers”), and depending on the fulfilment of certain performance targets linked to Mycronic’s Earnings Per Share (“EPS”), to receive allotment of Mycronic shares (”Performance Shares”). The participant shall not pay any consideration for the allotted Performance Shares. Performance Shares are Mycronic ordinary shares.
A.3 Participation in LTIP 2021
LTIP 2021 is directed towards a maximum of 70 employees, divided in three categories of participants:
| Category | Maximum number of shares per person |
| A) CEO (maximum 1 person) | 7 300 |
| B) Management Group (maximum 10 persons) | 2 800 |
| C) Other key employees (maximum 59 persons) | 1 100 |
Any resolution on participation or implementation of LTIP 2021 shall be conditional on that it, in the Board’s judgement, can be offered with reasonable administrative costs and financial effects.
A.4 Allotment of Performance Shares
Allotment of Performance Shares within LTIP 2021 will be made during a limited period of time following the Annual General Meeting 2024. The period up to this date is referred to as the qualification period (vesting period). A condition for the participant to receive allotment of Performance Shares is that the participant remains an employee of the Mycronic Group during the full qualification period up until allotment. Allotment of Performance Shares also requires that the EPS performance targets are fulfilled. The Board shall establish a customary definition of Good Leavers and determine whether any allocation shall be made to participants who are considered Good Leavers.
The performance targets are Mycronic’s EPS and the performance targets shall be established by the Board. Partial fulfilment of the performance targets will result in partial allotment of Performance Shares. Performance under a certain level will result in no allotment. The EPS targets and the outcome will be communicated to the shareholders after the allotment of Performance Shares to participants.
Prior to the allotment of Performance Shares, the Board shall assess whether the allotment is reasonable in relation to the company’s financial results, position and performance, as well as other factors.
If significant changes take place within the Mycronic Group, or on the market, which, by the assessment of the Board, would mean that the terms for allocation/transfer of shares according to LTIP 2021 is no longer reasonable, the Board shall have the right to implement an adjustment to LTIP 2021, including, among others, the right to reduce the number of Performance Shares allocated/transferred, or not to allocate/transfer Performance Shares at all.
A.5 Implementation and administration etcetera
The Board, with the assistance of the remuneration committee, shall in accordance with the resolutions by the Annual General Meeting set forth herein be responsible for the detailed design and implementation of LTIP 2021. The Board may also decide on the implementation of an alternative cash based incentive for participants in countries where the allotment of Performance Shares is not appropriate, as well as if otherwise considered appropriate. Such alternative incentive shall to the extent practically possible be designed to correspond to the terms of LTIP 2021.
The intention is that the Board shall launch LTIP 2021 as soon as practically possible after the Annual General Meeting.
In the event that the general meeting does not resolve in accordance with item B with the required majority, the Company shall hedge itself against the financial exposure that LTIP 2021 is expected to entail, by the company entering into a share swap agreement with a third party in accordance with what is stated in item C below.
B. Transfer of the company’s own shares under LTIP 2021 and hedging activities.
B1. Number of shares
The Board proposes that the Annual General Meeting resolves that transfer of up to 100 200 Mycronic shares under LTIP 2021 may be made in accordance with the below. The number of shares is calculated on the basis of maximum participation and maximum fulfilment of performance requirements.
B2. Other conditions for transfer of Mycronic shares
Mycronic shares may be transferred to the participants in LTIP 2021.
Share transfers to participants in LTIP 2021 shall be made without the participants paying consideration and shall be carried out at the time and subject to the other conditions under which participants in LTIP 2021 have the right to be allotted shares.
The number of Mycronic shares that might be transferred under LTIP 2021 shall be subject to customary re-calculation principles and may, consequently, be subject to re-calculation due to a bonus issue, share split, dividends and/or other similar events. Resolutions resolved upon by the Annual General Meeting 2021 shall not be included in a re-calculation of the number of shares.
B.3 Grounds for the Board’s proposal and alternative hedging via an equity swap agreement with a third party etcetera
Since the Board believes that the most cost efficient and flexible method to transfer Mycronic shares under LTIP 2021 is obtained through transfer of own shares, the Board proposes that transfers are secured as described above in this item B. Should the necessary majority not be obtained for the proposal in item B, the Board will enter into a share swap agreement, in accordance with item C below.
Share swap agreement will also be relevant should this be more appropriate, for example due to the fact that the acquisition of own shares cannot be made to the extent required to be able to transfer shares under LTIP 2021.
The reason for the deviation from the shareholders’ pre-emption rights to acquire the own shares is that the company shall be able to secure the delivery of shares under LTIP 2021.
C. Hedge of LTIP 2021 via an equity swap agreement with a third party
In the event that the necessary majority is not obtained for item B above, the company will hedge itself against the financial exposure that LTIP 2021 is expected to entail, by the company entering into a share swap agreement with a third party, whereby the third party in its own name shall acquire and transfer shares in the company under LTIP 2021. The relevant number of shares shall correspond to the number of shares proposed under item B above. The cost of hedging by entering into an equity swap agreement, excluding any dividends and without regard to the development of Mycronic’s share price, exceeds SEK 1 million during the term of the program.
D. Other matters in relation to LTIP 2021
D.1 Majority requirements etc.
The resolution according to item A above shall require a majority of more than half of the votes cast at the Annual General Meeting. A valid resolution under item B above requires that shareholders representing not less than nine-tenths of the votes cast as well as the shares represented at the Annual General Meeting approve the resolution.
D.2 Estimated costs, expenses and financial effects of LTIP 2021
LTIP 2021 will be accounted for in accordance with “IFRS 2 – Share‐based payments”. IFRS 2 stipulates that the share awards should be expensed as personnel costs over the qualification period and will be accounted for directly against equity. Personnel costs in accordance with IFRS 2 do not affect the company’s cash flow. Social security contributions will be recognized as an expense in the income statement through regular provisions in accordance with generally accepted accounting principles. The amount of these regular provisions will be revalued in line with the trend in the value of the right to Performance Shares, and the contributions payable on the allotment of Performance Shares.
Assuming a share price at the time of implementation of SEK 214, and that the performance targets are achieved so that 50 percent of the maximum number of Performance Shares vest, including a share price increase of 50 percent during the qualification period and an annual employee turnover of 5 percent, the total cost for LTIP 2021, including social security costs, is estimated to SEK 13.6 million before tax, corresponding to an estimated annual cost of SEK 4.5 million before tax.
Assuming that the performance targets are achieved so that 100 percent of the maximum number of Performance Shares vest, and otherwise the same assumptions as above, the total cost for LTIP 2021, including social security costs, is estimated to SEK 27.1 million before tax, corresponding to an estimated annual cost of SEK 9.0 million before tax.
LTIP 2021 will comprise maximum 100 200 shares in total, which corresponds to 0.10 percent of the total outstanding shares and votes in the company on a fully diluted basis.
The above calculations are based on a decision on hedging in accordance with item B.
In the view of the Board, the positive effects expected to arise from LTIP 2021, outweigh the costs associated with LTIP 2021.
D.3 The Board’s explanatory statement
An individual long-term ownership commitment among the participants in LTIP 2021 is expected to stimulate greater interest and motivation in the company’s business operations, results and strategy. Moreover, the Board wishes to increase the ability of Mycronic to retain important key employees. The Board believes that the implementation of LTIP 2021 will benefit Mycronic and its shareholders. LTIP 2021 will provide a competitive and motivation-improving incentive for executives and other key employees within the Group.
LTIP 2021 has been designed to reward the participants for increased shareholder value by allotting shares, based on the fulfilment of conditions in respect of results and operations. By linking the employees’ remuneration to the development of Mycronic’s results and value, the long-term value growth of Mycronic is rewarded. Based on these circumstances, the Board considers that the implementation of LTIP 2021 will have a positive effect on the Mycronic Group’s continued development, and will therefore be beneficial to the shareholders and Mycronic.
D.4 Other share-related incentive programs
The company’s share-related incentive programs are described on page 46 in the company’s annual report.
D.5 Adjustment Authorization
The Board, or a person appointed by the Board, shall be authorized to make adjustments to the above resolutions that may be necessary in connection with the registration with the Swedish Companies Registration Office and Euroclear Sweden AB respectively.
D.6 Preparation of the item
The basis for LTIP 2021 has been prepared by the Board of the company. The work has been supported by external advisors and has been made in consultation with shareholders. The Board has thereafter decided to present this proposal for the general meeting. Except for the staff that have prepared the matter upon instruction from the Board, no employee that may be a participant of LTIP 2021 has participated in the preparations of the program’s terms.
Item 20: The Board of Directors’ proposal for resolution to amend the Articles of Association
The Board of Directors proposes that the Annual General Meeting passes a resolution to amend the Articles of Association. According to Chapter 7, Section 4 of the Swedish Companies Act (2005:551) the Board of Directors may collect proxies for the general meeting if it is specified in the Articles of Association. According to Chapter 7, Section 4 a of the Swedish Companies Act it may also be stated in the Articles of Association that the Board of Directors may decide that the shareholders shall be able to exercise their voting rights by post before the general meeting.
In order to be able to use the alternatives provided by the Swedish Companies Act to decide on proxy collection and postal voting, the Board of Directors proposes that a new 11 § is included in the Articles of Association, with the wording set out below, and that the Articles of Association be re-numbered so that the current 11 § becomes 12 §:
11 § COLLECTION OF PROXY FORMS AND VOTING BY POST
The Board of Directors may collect proxies pursuant to the procedure stated in Chapter 7, Section 4, second paragraph of the Swedish Companies Act (2005:551).
The Board of Directors may decide before a General Meeting, if special circumstances exist according to the Board of Directors’ assessment, that the shareholders shall be able to exercise their voting rights by post before the General Meeting pursuant to the procedure stated in Chapter 7, Section 4 a of the Swedish Companies Act (2005:551).
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The financial statements and the audit report regarding the financial year 2020, as well as the nomination committee’s and the Board of Director’s complete proposals including related documentation will be available at the company at Nytorpsvägen 9 in Täby not later than by 14 April 2021, on the company website and will also be sent by post to shareholders requesting so and stating their postal address. The same applies to the Board of Directors report in accordance with Chapter 8, Section 53 a of the Swedish Companies Act (2005:551) and the auditor’s opinion in accordance with Chapter 8, Section 54 of the same law.
The total number of shares and votes in the company amounts to 97 916 509. The company does not hold any of these shares.
For information on how your personal data is processed, please see
https://www.euroclear.com/dam/ESw/Legal/Privacy-notice-bolagsstammor-engelska.pdf
Täby in March 2021
Mycronic AB (publ)
The Board of Directors
N.B. This English version of the AGM notice is an unofficial translation. In case of any discrepancies in relation to the Swedish version of the notice, the Swedish version shall prevail.
For further information, please contact:
Anders Lindqvist
CEO and President
Tel: +46 8 638 52 00, e-mail: anders.lindqvist@mycronic.com
Torbjörn Wingårdh
CFO
Tel: +46 8 638 52 00, e-mail: torbjorn.wingardh@mycronic.com
Tobias Bülow
Director Investor Relations
Tel: +46 734 018 216, e-mail: tobias.bulow@mycronic.com
The information was submitted for publication on 24 March 2021, at CET 12:30 p.m.
About Mycronic
Mycronic AB is a Swedish high-tech company engaged in the development, manufacture and marketing of production equipment with high precision and flexibility requirements for the electronics industry. Mycronic’s headquarters are located in Täby, north of Stockholm and the Group has subsidiaries in France, Japan, China, the Netherlands, Singapore, the United Kingdom, South Korea, Germany and the USA. Mycronic is listed on Nasdaq Stockholm. www.mycronic.com