Notice to attend the Annual General Meeting of NOTE AB (publ) on 26 April 2018

Shareholders are hereby invited to attend the Annual General Meeting of NOTE AB (publ), corporate identity number 556408-8770 (”The company”), Thursday on 26 April 2018 at 14.00 at Spårvagnshallarna, Birger Jarlsgatan 57 A, Stockholm. The registration of attendance at the Annual General Meeting will commence at 13.15.

Right to participate in the General Meeting

Shareholders who wish to attend the Annual General Meeting shall
- be entered in the share register maintained by Euroclear Sweden AB by Friday 20 April 2018,

- register with the Company by Friday 20 April 2018.

You can register by e-mail, info@note.eu, or by telephone +46 8 568 990 00. Notification can also be made in writing to NOTE AB, Box 1285, SE-164 29 Kista, Sweden. Notification must state the shareholder's name or company, personal or corporate identity number, number of shares, address and telephone number. Shareholders who wish to be accompanied by one or two assistants should notify them in the same way.

Personal data obtained from the share register maintained by Euroclear Sweden AB, notification of and attendance at the meeting and information about representatives, proxies and assistants will be used for registration, preparation of the voting list for the meeting and, where applicable, minutes of the meeting.

Shareholders whose shares are registered in the name of a nominee should in good time before Friday 20 April 2018, through the intermediary of the nominee, temporarily register the shares in their own name in order to be entitled to attend the meeting.

The number of shares and votes in the Company amounts to 28,872,600 as of the date of this notice. The Company holds no own shares as of the date of this notice.

Ombudsmen

Shareholders represented by proxy must issue a dated power of attorney for the proxy. If the power of attorney is issued by a legal entity, the power of attorney must be signed by an authorised signatory and a copy of the certificate of registration or equivalent authorisation document for the legal entity must be attached. The registration certificate or equivalent authorisation document must not be older than six months. A copy of the power of attorney and any certificate of registration or equivalent document of authorisation should be sent by post to the Company at Box 1285, SE-164 29 Kista, Sweden, in good time before the meeting. The original proxy must also be presented at the meeting. A proxy form is available for download on the Company's website, www.note.eu.

DRAFT AGENDA

1. Opening of the meeting.
2. Election of chairman and minute-taker for the meeting.
3. Drawing up and approval of the voting list.
4. Approval of the agenda proposed by the Management Board.
5. Election of one or two scrutineers.
6. Examination of whether the meeting has been duly convened.
7. Report on the work of the Board.
8. Presentation of the annual accounts and the auditors' report, as well as the consolidated accounts and the consolidated auditors' report.
9. Decision
   a) a) on the adoption of the profit and loss account and the balance sheet and the consolidated profit and loss account and the consolidated balance sheet 
   b) on the appropriation of the Company's profit according to the adopted balance sheet,
   c) discharging the members of the Board of Directors and the Managing Director from liability.
10. Determination of the number of directors and auditors elected at the annual general meeting.
11. Determination of the remuneration of the Board of Directors and the auditors.
12. Choice of
    a) Board of Directors,
    b) auditors.
13. Adoption of the Nomination Committee's proposal for instructions for the Nomination Committee.
14. Adoption of the Board of Directors' proposal for guidelines for remuneration to senior executives.
15. Resolution authorising the Board of Directors to decide on the acquisition and transfer of own shares.
16. The Board of Directors' proposal for resolution on Incentive Programme 2018/2021 and issue of warrants.
17. Closure of the meeting.

The Nomination Committee

The Nomination Committee has consisted of Fredrik Hagberg (Myggenäs Gård AB), Johan Hagberg (own holding), Jonas Hagströmer (Creades AB) and Martin Nilsson (Catella Fondförvaltning). The Chairman of the Nomination Committee has been Jonas Hagströmer.

Nomination Committee proposals (items 2, 10, 11, 12 and 13)

Item 2. John Hedberg is proposed as Chairman of the meeting.

Point 10. It is proposed that the Board of Directors shall consist of five ordinary members without deputies. It is proposed that an audit firm be appointed as auditor.

Item 11. The Board's remuneration including committee work for the period up to and including the next Annual General Meeting is proposed to be paid totalling 783,000 (860,000[1]) SEK. The Board's fees are proposed to be allocated as follows: fees for the Chairman SEK 255,000 (250,000) and fees for other members SEK 112,000 (110,000) per member. In addition, it is proposed that SEK 80,000 (60,000) be allocated as follows: SEK 30,000 per member of the Audit Committee and SEK 10,000 per member of the Remuneration Committee.

It is proposed that the remuneration of the chairman and each member will increase by 2% from the previous year and that the remuneration for committee work will increase by 33%.

In accordance with the Audit Committee's recommendation, it is proposed that auditors' fees be paid on a current account basis.

Item 12. a) The following Board members are proposed for re-election: Kjell-Åke Andersson, Johan Hagberg, John Hedberg and Bahare Hederstierna. Johannes Lind-Widestam is proposed for new election. John Hedberg is proposed as Chairman of the Board.

Item 12. b) Re-election is proposed, in accordance with the recommendation of the Audit Committee, by the auditing firm Öhrlings PricewaterhouseCoopers AB (PwC) for the period until the end of the next Annual General Meeting. PwC has announced that if PwC is elected, PwC will appoint Niklas Renström as auditor in charge.

The Nomination Committee shall be formed by the four largest shareholders in terms of voting rights as of 30 September who wish to participate, each appointing a member at least six months before the Annual General Meeting, with the Chairman of the Company's Board of Directors as convener. For the purpose of determining the four largest shareholders in terms of voting rights, a group of shareholders shall be deemed to constitute one shareholder if they have been grouped together in the Euroclear system. Where one or more shareholders renounce their right, the next largest shareholder shall be given the same opportunity. When shareholders are contacted, the Chairman of the Board shall set out the necessary rules of procedure, such as the last day for replying, etc. Otherwise, the Nomination Committee shall be subject to what applies from time to time under the Swedish Code of Corporate Governance. The names of the four members shall be published as soon as they are appointed.

The majority of the members of the nomination committee shall not be members of the board of directors and the managing director or any other member of the management shall not be a member of the nomination committee. The chairman of the nomination committee shall, unless the members agree otherwise, be the member who represents the largest shareholder in terms of votes. However, a member of the Board of Directors shall not be the Chairman of the Nomination Committee. The Nomination Committee's mandate runs until a new Nomination Committee is appointed.

If an owner is no longer among the four largest shareholders in the Company, its representative shall make its seat available, and shareholders who have become among the four largest shall be offered a seat on the Nomination Committee. Shareholders who have appointed a representative to the Nomination Committee are entitled to dismiss such member and appoint a new representative. If a representative leaves the Nomination Committee for any other reason before its work is completed, the shareholder who appointed the representative shall be given the opportunity to appoint a new representative. Changes in the nomination committee shall be publicised.

The Nomination Committee shall prepare a proposal for the Chairman of the Meeting, the Board of Directors, the Chairman of the Board of Directors, Board fees, instructions for the Nomination Committee and, where applicable, auditors, and auditors' fees to be submitted to the Annual General Meeting (and, where applicable, the Extraordinary General Meeting) for decision.

At the request of the Nomination Committee, the Company shall provide personnel resources such as secretarial services to facilitate the work of the Nomination Committee. If necessary, the company shall also be able to pay reasonable costs for external consultants that the nomination committee deems necessary for the nomination committee to fulfil its assignment.

The above principles for the appointment of the Nomination Committee and the Nomination Committee's assignment shall apply until the General Meeting decides to change them. It is the responsibility of the Nomination Committee to decide prior to the Annual General Meeting whether the Nomination Committee deems it necessary to propose to the Annual General Meeting that the principles in question be amended.

The Board of Directors' proposal for a resolution on the appropriation of the company's profit according to the adopted balance sheet

The Board of Directors proposes that the Company pays a dividend to the shareholders of SEK 0.70 per share with Monday 29 April 2019 as the record date. With this record date, Euroclear Sweden AB is expected to pay the dividend on Friday 3 May 2019.

The Board of Directors recalls that, according to the balance sheet as at 31 December 2017, the Company's total profits amount to SEK 86,867,523 and thus exceed the total amount of the proposed dividend of SEK 28,872,600 by SEK 57,994,923.

The Board of Directors' proposal for guidelines for remuneration to senior executives (item 14) 

The Board of Directors proposes that the General Meeting adopts the following (unchanged) guidelines for remuneration to senior executives for the period until the next Annual General Meeting. Senior executives are defined as the CEO and members of the Company's management team.

The fixed salary shall take into account the individual's responsibilities, experience and performance and shall be reviewed annually. Variable remuneration is dependent on the individual's fulfilment of quantitative and qualitative targets and can amount to a maximum of 100% of the fixed salary. In 2018, the variable remuneration for senior executives (six individuals) totalled approximately SEK 1 600 000.

The retirement age is 65 years. The company offers ITP-like benefits. Termination pay and severance pay for a senior executive shall not exceed a total of 24 months' remuneration.

The Board of Directors shall be authorised to deviate from the above guidelines for remuneration in individual cases and if special reasons exist. If such a deviation occurs, information about this and the reason for the deviation shall be reported at the next Annual General Meeting.

The Board of Directors' proposal for authorisation for the Board of Directors to decide on the acquisition and transfer of own shares

The Board of Directors proposes that the Annual General Meeting authorises the Board of Directors, during the period until the next Annual General Meeting, on one or more occasions, to decide on the acquisition and/or transfer of the Company's own shares on essentially the following terms.

Acquisitions may be made against cash payment on Nasdaq Stockholm or in accordance with an acquisition offer to all shareholders. Acquisitions may be made of a maximum number of shares so that the Company's own holding at any time does not exceed ten (10) per cent of all shares in the Company. Shares may only be acquired on Nasdaq Stockholm at a price within the price interval registered on Nasdaq Stockholm at any given time, meaning the interval between the highest bid price and the lowest ask price. Acquisitions in accordance with an acquisition offer as above shall be made at a price corresponding to the lowest market price at the time of the offer with a maximum deviation of twenty (20) per cent upwards.

Shares may only be transferred outside Nasdaq Stockholm, with or without preferential rights for the shareholders and with or without provisions for non-cash consideration or right of set-off. Such transfer may be made at a price in money or value of property received corresponding to the market price at the time of the transfer of the shares transferred with such deviation as the Board of Directors deems appropriate. The number of shares that may be transferred shall not exceed ten (10) per cent of the total number of shares in the Company. Transfers in connection with company acquisitions may be made at a market value assessed by the Board of Directors.

The purpose of the above authorisations regarding the acquisition and transfer of own shares is to enable the financing of business acquisitions through payment with own shares and to be able to continuously adapt the Company's capital and share structure in order to contribute to increased shareholder value.

In order to be valid, the above-mentioned proposal must be supported by shareholders representing at least two thirds (2/3) of both the votes cast and the shares represented at the meeting.

The Board of Directors' proposal for resolution on Incentive Programme 2018/2021 and issue of warrants (item 16)

The Board of Directors proposes that the Annual General Meeting resolves to introduce a long-term incentive programme (”Incentive Programme 2018/2021”) for current and future members of the Executive Board and key employees (”Participants”The proposal for a resolution on an incentive programme has been presented as the Board of Directors considers it important and in the interest of all shareholders to create even greater participation for the Participants within the Company with regard to the Company's development. The Incentive Programme 2018/2021 is proposed to comprise a maximum of 15 Participants.

In light of the above, the board of directors proposes that the general meeting resolves on the implementation of the Incentive Programme 2018/2021 and resolves on an issue of warrants in accordance with the following and that the general meeting resolves to approve the transfer of the warrants.

A. Issue of warrants

The board of directors proposes that the general meeting resolves on a directed issue of not more than 400,000 warrants, entailing an increase of the share capital upon full utilisation by not more than SEK 200,000. The resolution shall otherwise be subject to the following conditions.

The right to subscribe for the warrants shall, with deviation from the shareholders” preferential rights, belong to the wholly owned subsidiary NOTE Components AB, corporate identity number 556602-2116 ("Subsidiary company”) which shall sub-transfer the warrants to the Participants in accordance with point B below.

The reasons for the deviation from the shareholders' preferential rights are to introduce an incentive programme whereby the Participant, through its own investment, shall participate in and promote a positive value development of the Company throughout the period covered by the proposed incentive programme, and to enable the Company to retain competent and committed personnel.

The warrants are issued free of charge to the Subsidiary.

Subscription of the warrants shall be possible from 30 April 2018 up to and including 7 May 2018. The Board of Directors is authorised to extend the subscription period.

Subscription of shares through exercise of the warrants shall be possible from 18 May 2021 up to and including 11 June 2021, taking into account the insider legislation applicable from time to time. However, subscription of shares by virtue of warrants may not take place during such period when trading in shares in the Company is prohibited under Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (Market Abuse Regulation), or other equivalent legislation applicable at any given time.

Each warrant shall entitle to subscription of one (1) share in the Company at a subscription price of 130 per cent of the volume weighted average of the quoted prices paid (according to the price list on Nasdaq Stockholm where the Company's share is listed) for the share in the Company during the period from 21 January 2019 up to and including 11 February 2019 (however, not lower than the share's quota value of SEK 0.5). Days without a quoted price paid shall not be included in the calculation.

Warrants held by the Subsidiary and not transferred in accordance with item B below may be cancelled by the Company following a decision by the board of directors of the Subsidiary. Cancellation shall be notified to the Swedish Companies Registration Office for registration.

In order to fulfil the obligations under the Incentive Programme 2018/2021, the board of directors proposes that the general meeting approves that the Subsidiary may dispose of and transfer the warrants to third parties in accordance with item B below.
The usual conversion terms shall apply to the warrants.

B. Approval of transfer of warrants

1. Right to purchase

The participants' right to acquire the warrants shall be differentiated with reference to position, responsibility and work performance in the Company. However, each person entitled to subscribe may subscribe for a maximum of 200,000 warrants each.

If Participants refrain from acquiring all or part of the warrants offered, such unacquired warrants shall be distributed pro rata among Participants who have expressed an interest in acquiring additional warrants in writing. In this way, Participants may not acquire more than an additional 30 per cent of the originally offered number of warrants, however, a maximum of 200,000 warrants.

The Board of Directors shall finalise the allocation according to the principles set out above, as well as the number of warrants that Participants shall be offered to acquire.

The right to receive warrants requires that the Participant enters into a special pre-emption agreement with the Company. As a general rule, pre-emption shall be made at market value. In accordance with the pre-emption agreement entered into, pre-emption shall, in special cases, be made at a price corresponding to the lower of (i) the Participant's acquisition value for the warrants or (ii) the market value of the warrants. Otherwise, the warrants are freely transferable.

The Company has a right, in special cases, to repurchase the warrants from the holder if the warrant holder does not wish to exercise all acquired call options and notifies the Company of this. The purchase of warrants shall be made at a price that at any time corresponds to the market value at most. However, repurchase of warrants may not take place during such period when trading in shares in the Company is prohibited pursuant to Article 19 of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (Market Abuse Regulation), or other equivalent legislation applicable at any given time.

Allocation presupposes that the acquisition of warrants can legally take place and that it can be done at a reasonable administrative and financial cost.

The members of the Company's Board of Directors will not be covered by the Incentive Programme 2018/2021.

2. notification period

Notification of acquisition of warrants shall be made on 18 May 2018. However, the Board of Directors is authorised to extend the time for notification of acquisition.

3. notification and allocation

Persons entitled to acquire warrants shall be entitled to apply to acquire warrants in lots corresponding to either the maximum number of warrants offered or reduced by lots of 1 000 warrants. Allocation shall be made in whole lots of 1 000 warrants.

4. Price and payment etc.

The warrants shall be transferred on market terms at a price determined on the basis of an estimated market value of the warrants using the Black & Scholes valuation model (”Option premiums”) calculated by the Board of Directors. The measurement period for the calculation of the Option Premium shall take place during the period from 26 April 2018 up to and including 16 May 2018, or, in the event the Board of Directors decides to extend the notification period in paragraph 2 above, a corresponding measurement period in connection with the transfer.

Payment for allotted warrants shall be made in cash no later than 25 May 2018, however, the Board of Directors is entitled to extend the time for payment.

C) Details of the issue and transfer
 
1. dilution

Upon full exercise of all warrants under the Incentive Programme 2019/2022, up to 400,000 shares (subject to possible recalculation), corresponding to approximately one (1) per cent of the total number of outstanding shares and votes, may be issued. The calculation is based on the maximum number of shares and votes that may be issued divided by the total number of shares and votes after such issue. Upon full subscription, the company's share capital will increase by SEK 200,000.

Together with outstanding warrants in the warrant programme 2017/2020, the total dilution corresponds to approximately four (4) per cent of the total number of outstanding shares and votes.

2. calculation of the market value 

The expected level of volatility in the valuation of the warrants has been assessed by the Board of Directors to currently be around 28 per cent. At an estimated future volatility level during the term of the warrants at the corresponding level and assuming that the average value of the Company's shares during the period for the valuation of the warrants amounts to SEK 22, whereby the subscription price for the warrants will amount to SEK 28.60 and taking into account the Company's dividend policy, the value per warrant will be SEK 1.11 according to the Black & Scholes valuation model. The Board of Directors' valuation of the warrants will be reviewed by the independent valuation institute PwC.

Costs for the Company and impact on key figures etc. 

The Incentive Programme is expected to have a marginal effect on the Company's earnings per share. Given that the warrants shall be transferred at market price, no special social security costs will arise for the Company in connection with the transfer of the warrants to the Participants.

The total costs, including other costs for the Incentive Programme 2019/2022, in the form of fees to external advisors, valuation, own work and for practical management of the incentive programme are estimated to amount to approximately SEK 200,000 during the term of the incentive programme.

4. Preparation of the case

The principles for the Incentive Programme 2018/2021 have been prepared by the Board of Directors (also the Company's Remuneration Committee), with the support of external advisors. The Board of Directors has subsequently decided to present this proposal to the Annual General Meeting. Apart from the individuals who have prepared the matter in accordance with instructions from the Board, no employee who may be covered by the incentive programme has participated in the formulation of the terms and conditions.

5. outstanding programmes 

The Company has one outstanding warrant programme; 2017/2020. At the Annual General Meeting on 20 April 2017, the Board's proposal regarding the incentive programme for key employees was approved, as well as a resolution to issue 600,000 warrants 2017/2020 and a resolution to approve the transfer of warrants. Upon full subscription with the support of all warrants, 600,000 new shares can be issued, which corresponds to a dilution of approximately 2 per cent of the total number of shares and votes in the Company. 600,000 warrants have been subscribed. The subscription price was set at SEK 23.30 per share.

The Company has no other outstanding warrant programmes.

D. Authorisations and decision-making rules

The General Meeting authorises the Board of Directors of the Company to execute the resolution under item A above and to ensure that the Board of Directors of the Subsidiary executes the transfer of warrants under item B above.

The Board of Directors, or the person appointed by the Board of Directors, is authorised to make the minor adjustments required for the registration of the resolution with the Swedish Companies Registration Office.

A resolution in favour of this proposal requires the support of shareholders representing at least nine-tenths (9/10) of both the votes cast and the shares represented at the meeting.

Shareholders' right to request information

According to Chapter 7, Sections 32 and 57 of the Swedish Companies Act, the Board of Directors and the 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 at the meeting on circumstances that may affect the assessment of an item on the agenda and circumstances that may affect the assessment of the Company's financial situation.

Documents for the General Meeting

Accounting documents, the auditor's report and the Board of Directors' proposals for resolutions as well as other documents required under the Swedish Companies Act will be available at the Company at Borgarfjordsgatan 7 in Kista and on the Company's website, www.note.eu, no later than three weeks prior to the meeting. The Nomination Committee's proposal and statement are available on the Company's website. The documents will be sent free of charge to shareholders who so request and provide their postal address or e-mail address. All of the above documents will also be presented at the meeting.

Kista in March 2018

The Board of Directors of NOTE AB (publ)
                                                                                                  

About NOTE
NOTE is one of northern Europe's leading partners for electronics manufacturing. NOTE manufactures printed circuit boards (PCBA), sub-assemblies and complete products (box build). Its customer offering covers the whole product lifecycle, from design to after-sales. NOTE is established in Sweden, Finland, the UK, Estonia, Bulgaria and China. Sales in the last 12 months were SEK 3,687 million and the group has some 1,400 employees. NOTE is listed on Nasdaq Stockholm. For more information, please visit

This information is information that NOTE AB (publ) is obliged to make public pursuant to the rules for issuers on Nasdaq Stockholm. The information was submitted for publication on 10 March 2021 at 13:00 CET. 

[1] Only SEK 766 877 was paid as Per Ovrén did not receive a board fee after taking over as CEO.

Press release (PDF)