Pre-Annual General Meeting Information • Apr 6, 2017
Pre-Annual General Meeting Information
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are hereby summoned to the annual general meeting on Tuesday, May 9, 2017 at 10 a.m. by the company's offices, Västberga Allé, Hägersten, Stockholm
Shareholders who wish to participate in the annual general meeting must
Shareholders whose shares have been registered in the name of a bank or other trust department or with a private securities broker, must temporarily re-register their shares in their own names with Euroclear Sweden AB in order to be entitled to participate in the annual general meeting. Shareholders wishing such re-registration must inform their nominee of this well before Wednesday, May 3, 2017, when such re-registration must have been completed.
Shareholders represented by proxy shall issue dated and signed power of attorney for the proxy. If the power of attorney is issued on behalf of the proxy or, should the right to vote for the shares be divided among different representatives, the representatives, together with information on the number of shares each representative is entitled to vote for. The proxy is valid for one year from the issuance or the longer period of validity stated in the proxy, however not more than five year from the issuance. If the proxy is issued by a legal entity, attested copies of the certificate of registration or equivalent authorisation documents, evidencing the authority to issue the proxy, shall be enclosed. The power of attorney in original and, where applicable, the registration certificate, should be submitted to the company by mail at the address set forth above well in advance of the annual general meeting. A proxy form is available on the company's website, www.netinsight.net, and will also be sent to shareholders that so request and inform the company of their postal address.
The shareholders are reminded of their right to ask questions to the Board of Directors and the CEO at the annual general meeting in accordance with Chapter 7, Section 32 of the Swedish Companies Act (Sw. aktiebolagslagen).
There are, as of the day of this notice, 389,933,009 shares, whereof 1,000,000 Class A shares and 388,933,009 Class B shares, and a total of 398,933,009 votes in the company. As of the day of this notice, the company holds 4,275,000 own B-shares.
The Board of Directors and the managing director propose that the company's results shall be carried forward and thus no dividend will be distributed.
The Board of Directors propose that it is in Section 6 of the articles of association is added a sentence stipulating that any deputy board member only may take such board members place as the deputy is appointed a personal deputy for, and that Section 8 is amended so that the time stipulated in the second paragraph for when shareholders shall give notice to the company will be deleted.
The complete articles of association that is proposed to be adopted by the general meeting is available at the company's website.
The nomination committee, appointed in accordance with the process that was determined at the annual general meeting 2016, consists of Lars Bergkvist, Chairman, (Lannebo Fonder), Jan Barchan (Briban Invest), Ramsay Brufer (Alecta), Christian Brunlid (Handelsbanken fonder) and Lars Berg (Chairman in Net Insight AB). The nomination committee proposes that:
Stina Barchan holds a PhD, History of Art, from University College London, as well as a Master of Arts, History of Art, from University College and a Bachelor of Arts in arts and literature from Lund University. Stina Barchan has many years of experience from board work, and also experience from nomination committee work from listed environment. Currently, Stina Barchan is board member of Briban Invest, deputy board member of Trailbee and member of the nomination committee in Studsvik. Previously, Stina Barchan has been board member of Teoritentamen.no (previously Lobus) and deputy board member of The Astonishing Tribe. Stina Barchan also is appointed Teaching Fellow at the History of Art Department, University College London.
It is proposed that the following shall apply until a general meeting resolves otherwise:
The Chairman of the Board shall each year convene the four largest shareholders in the company based on Euroclear Sweden AB's list of shareholders (grouped) on the last day in August and on other reliable information provided by the company at that time. These shareholders shall then each appoint a representative to be a member of Nomination Committee together with the Chairman of the Board until a new Nomination Committee has been appointed. The nomination committee elects a Chairman.
If one of the four largest shareholders waives their right to appoint a member, the next largest shareholder, based on the number of votes, shall be entitled to appoint a member. If a member of the Committee resigns before the committee's work is finished, the same shareholder who appointed the resigning member is entitled to appoint a new member if deemed necessary. If this shareholder is no longer one of the four largest owners in the company, a new member shall be appointed by the new shareholder within this group.
The Nomination Committee shall be announced through a press release as soon as the committee is appointed. If ownership is then substantially changed the composition of the Committee changed accordingly and the change shall be announced by way of a press release.
The Nomination Committee shall prepare the following proposals to submit to the Annual General Meeting for resolution:
The Nomination Committee shall in connection with its duties meet the requirements according to the Swedish Companies Act and the Swedish Code of Corporate Governance for Nominating Committees.
The Nomination Committee shall have the right to charge the company with costs for recruitment consultants that may be required for the committee to fulfil its mission. No remuneration is paid to the committee members.
The Board of Directors proposes that the annual general meeting resolves to approve the Board of Directors' proposal regarding guidelines for remuneration and other terms of employment for senior executives as set forth below.
The company offers salaries and remuneration in line with market practice, as verified by an external compensation database, based on a fixed and a variable component. Remuneration to the CEO and other senior executives consists of basic salary, variable remuneration and pension benefits. "Senior executives" refers to those people, including the CEO, who constitute executive management. The division between fixed and variable remuneration is in proportion to the manager's responsibility and authority. The variable remuneration is based on a combination of revenue, results and activity targets.
For the CEO, annual variable remuneration is capped at 100 per cent, and for the Global Head of Sales at 150 per cent, of basic salary. For other senior executives, variable remuneration is capped at between 20 and 60 per cent of basic salary. For the CEO and other senior executives, 70 per cent of the variable remuneration is based on measurable financial targets. For the Global Head of Sales, the compensation model is wholly based on the company's revenues.
For certain senior executives, half of the outcome of variable remuneration is put in escrow and paid out in the fourth year following the vesting period. At the time of payment, a multiplier will be applied to the amount held in escrow to reflect share price performance during these three years. The multiplier is based on the ratio of the average share price for two eight-week periods, where the first period commences on the publication date of Net Insight's Year-end Report in the year following the first year of the vesting period, and the second period commences on the publication date of the Year-end Report in the year when payment shall occur (i.e. three years between the periods). The average share price is the average of the daily closing share prices of each eight-week period. The multiplier is limited to a maximum value of 5 and minimum value of 0.5.
Where a Board member serves the company or another group company in addition to work on the Board, a consultancy fee and/or other remuneration may be payable.
Almost all staff are eligible for some form of variable remuneration. All variable remuneration and applicable social security contributions are provisioned in the accounts.
From time to time, the Board of Directors may propose share-based long-term incentive programs, which are then considered by shareholders' meetings as a separate item.
The company's pension liability to the CEO amounts to 30 per cent of basic annual salary, excluding variable components. Senior executives have defined contribution pension provisions, pursuant to the company's policy, legislation and contracts.
The company and the CEO have a reciprocal notice period of six months. Upon termination by the company, a redundancy payment corresponding to 12 months' salary becomes due. Any salary or other remuneration that the CEO receives from employment or other business the CEO conducts during the notice period of the following 12-month period should be deducted from redundancy payments. The company and other senior executives have reciprocal notice periods of 3-6 months. The Board of Directors is entitled to deviate from these guidelines in special circumstances.
The Board of Directors proposes that the annual general meeting resolves to introduce a cashbased option programme related to Net Insight's share price development, mainly in line with the synthetic option programme adopted by the annual general meeting 2016. It is proposed that the programme is carried out through the issue of synthetic options ("Option Programme 2017").
The Board of Directors believes that a programme that in the long term gives employees within the group an opportunity to share in the growth in value of the company will maintain confidence in Net Insight and increase the value of its shares. Option Programme 2017 is expected to lead to greater involvement and increased motivation for the participants in the programme and result in those included in the programme having stronger ties to Net Insight. In addition, Option Programme 2017 is expected to align the interests of the participants with the interests of the shareholders. Option Programme 2017 includes primarily those who have not been able to participate in Option Programme 2015 and 2016 and who are employed within the Swedish organization of the Net Insight group and are residents in Sweden (the "Participants"). Net Insight's Board of Directors is of the opinion that Option Programme 2017 will benefit Net Insight's shareholders and that it will contribute to opportunities to recruit and retain competent employees.
In order to be able to carry out Option Programme 2017, the Board of Directors proposes that the annual general meeting decides on the main terms and conditions for the issue to the Participants of synthetic options related to Net Insight's share price during a period of three (3) years.
The proposal gives the Participants the opportunity to notify their interest in acquiring synthetic options at market price and allocation will be made in accordance therewith or, in the event that the Participants, in total, sign up for a greater number of options than the number of options that Option Programme 2017 comprises, allocation will be made on a pro rata basis in relation to each Participant's part of the total number of options that the Participants seek to obtain. During the term of Option Programme 2017 there will be two payments made of equal installments to the Participants following the second and the third year of the term and these payments will in total correspond half of the price paid for the options. As the acquisitions will be made at market price, Net Insight will have no initial cost and the future cost for the company will depend on the development of Net Insight's share price. The payment per synthetic option cannot exceed three times the share price at the time of the start of the programme.
The total value of the synthetic options at the maturity of Option Programme 2017, adjusted for the Participants' initial investment, paid strike price and the abovementioned installments, including social security contributions, will be Net Insight's cost for Option Programme 2017.
The proposal has been prepared together with external advisers and has been examined by the Reumuneration Committee and the Board of Directors. The proposal was adopted by the Board of Directors on 14 March 2017.
Invitation for acquisition of and entering into an agreement regarding synthetic options shall be resolved by the Board of Directors according to the following terms and conditions:
d) Participants shall no later than 26 May 2017 or such other date as decided by the Board of Directors, notify their interest in acquiring options and the number of options he or she wishes to acquire.
e) The Participants' acquisitions of synthetic options shall be made at market price. The price will be calculated by an independent valuation institute applying a standard valuation model (Black & Scholes).
The annual general meeting's resolution according to the above shall be made taking into account the majority rules stipulated in Chapter 7, Section 40 of the Swedish Companies Act, which means that the resolution must be supported by shareholders representing more than half of the number of votes represented at the meeting.
The Board of Directors proposes that the annual general meeting resolves to introduce a cashbased option programme related to Net Insight's share price development to employees outside of Sweden. It is proposed that the programme is carried out through the issue of synthetic options ("Global Option Programme 2017").
The Board of Directors believes that a programme that in the long term gives employees within the group an opportunity to share in the growth in value of the company will maintain confidence in Net Insight and increase the value of its shares. Global Option Programme 2017 is expected to lead to greater involvement and increased motivation for the participants in the programme and result in those included in the programme having stronger ties to Net Insight. In addition, Global Option Programme 2017 is expected to align the interests of the participants with the interests of the shareholders. Global Option Programme 2017 includes all of the approximately 80 employees within the Net Insight group outside of Sweden (the "Participants"). Net Insight's Board of Directors is of the opinion that Global Option Programme 2017 will benefit Net Insight's shareholders and that it will contribute to opportunities to recruit and retain competent employees.
In order to be able to carry out Global Option Programme 2017, the Board of Directors proposes that the annual general meeting decides on the main terms and conditions for the issue to the Participants of synthetic options related to Net Insight's share price during a period of three (3) years.
Global Option Programme 2017 is proposed to comprise 1,325,000 synthetic options, allocated to the Participants depending on each Participants category of allotment. Key employees (approximately 5 persons) will obtain no more than 70,000 options each, High performance employees (approximately 15 persons) will obtain no more than 25,000 options each and Other employees (approximately 60 persons) will obtain no more than 10,000 options each. As the acquisitions will be made without any contributions, Net Insight will have an initial cost and the future cost for the company will depend on the development of Net Insight's share price. The payment per synthetic option cannot exceed three times the share price at the time of the start of the programme.
The total value of the synthetic options at the maturity of Global Option Programme 2017, adjusted for social security contributions and certain other tax consequences, will be Net Insight's cost for Global Option Programme 2017.
The proposal has been prepared together with external advisers and has been examined by the Remuneration Committee and the Board of Directors. The proposal was adopted by the Board of Directors on 14 March 2017.
Invitation for acquisition of and entering into an agreement regarding synthetic options shall be resolved by the Board of Directors according to the following terms and conditions:
a) The opportunity to acquire synthetic options shall include all of the approximately 80 employees within the Net Insight group outside of Sweden, with a maximum of 70,000. 25,000 or 10,000 options per person depending on which category of allotment the employee belongs to. Members of Net Insight's Board of Directors are not included in the invitation.
The annual general meeting's resolution according to the above shall be made taking into account the majority rules stipulated in Chapter 7, Section 40 of the Swedish Companies Act, which means that the resolution must be supported by shareholders representing more than half of the number of votes represented at the meeting.
The Board of Directors proposes that the annual general meeting authorizes the Board of Directors to resolve to repurchase, on one or several occasions until the next annual general meeting, as many own shares as may be purchased without the company's holding at any time exceeding 5 per cent of the total number of shares in the company. The shares shall be
purchased on Nasdaq Stockholm and only at a price per share within the price range applicable, i.e. the range between the highest purchase price and the lowest selling price.
The Board of Directors also proposes that the annual general meeting authorizes the Board of Directors to resolve, on one or several occasions until the next annual general meeting, to transfer (sell) own shares. Transfers may be carried out on Nasdaq Stockholm at a price within the price range applicable, i.e. the range between the highest purchase price and the lowest selling price. Transfers may also be made in other ways, with or without preferential rights for the shareholders, against cash payment or against payment through set-off or in kind, or otherwise on special conditions. Upon such transfers, the price shall be established so that it is not below market terms. However, a discount to the stock market price may apply, in line with market practice. Transfers of own shares may be made of up to such number of shares as is held by the Company at the time of the Board of Directors's resolution regarding the transfer.
The purpose of the authorization to repurchase own shares is to promote efficient capital usage in the company, to provide flexibility as regards the company's possibilities to distribute capital to its shareholders and to provide hedging for the company's option programme. The purpose of the authorization to transfer own shares is to enable the Board of Directors to make corporate acquisitions, product acquisitions or enter into collaboration agreements, or to raise working capital or broaden the shareholder base or for use in the context of the company's incentive plans or to provide hedging for the company's option programme.
The annual general meeting's resolution according to the above shall be made taking into account the majority rules stipulated in Chapter 19, Sections 18 and 33 of the Swedish Companies Act, which means that the resolution must be supported by shareholders representing at least two-thirds of both the votes cast and the shares represented at the meeting.
Shareholders representing approximately 32 per cent of the votes of all shares in the company have announced that they at the annual general meeting will support the above resolutions as regards items 1 and 10-14.
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The annual report, the auditor's report and the auditor's statement whether the Board of Directors' guidelines for remuneration to key executives have been applied will not later than Tuesday, April 18, 2017 be held available at the company's office at Västberga Allé 9, Hägersten, Sweden, and on the company's website as well as sent to the shareholders who so request and inform the company of their postal address.
Stockholm, April, 2017
NET INSIGHT AB (publ)
The Board of Directors
Fredrik Tumegård, CEO of Net Insight, +46 8 685 04 00, [email protected]
This information is information that Net Insight AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 5.30 pm CET 6th April, 2017.
Net Insight's vision is to enable a live and interactive media experience for anyone on earth. Our aim is to lead progress and enable a global media marketplace where live content can be exchanged and interaction among TV audiences can take place in real-time. We want to create the media experience of the future, centered on content.
Net Insight delivers products, software and services for effective, high-quality media transport, coupled with the effective management of resources, all, which creates an enhanced TV experience. Net Insight's offerings span across the entire media spectrum, starting from TV cameras and TV studios, right through to the TV consumers. Our solutions benefit network operators, and TV and production companies, by lowering total cost of ownership, improving their workflow efficiencies and providing them with the ability to capture new business opportunities.
More than 500 world-class customers run mission critical media services using Net Insight's solutions, covering more than 60 countries worldwide. Net Insight is listed on Nasdaq Stockholm.
For more information, please visit netinsight.net
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