Welcome to the Annual General Meeting for HMS Networks AB in
Halmstad
The shareholders of HMS Networks AB (publ), Reg. no.
556661-8954, are hereby invited to the Annual General Meeting,
which will be held at 10.30 a.m on Thursday 25 April 2019 at the
HMS head office, Stationsgatan 37, Halmstad. Registration for the
Annual General Meeting will begin at 9.30 a.m.Right to
participate in the Annual General MeetingShareholders who
wish to participate in the Annual General Meeting must be
registered in the share register kept by Euroclear Sweden (the
Swedish Central Securities Depository) on Wednesday 17 April 2019
and give notice of their intention to participate in the Annual
General Meeting to the Company no later than on Wednesday 17 April
2019 preferably before 4 p.m.Notification shall be made by phone
+46 (0)35-17 29 00, in writing to Computershare AB, “HMS Networks
AB’s Annual General Meeting” Box 610, 182 16 Danderyd, or via the
website: www.hms-networks.com. The notification should include
name, personal ID number/CIN, address, daytime telephone number
and, when applicable, information on assistants (no more than two)
or deputies who will be attending. The notification should include,
where applicable, complete authorisation documents such as
registration certificate, power of attorney, or
equivalent.ProxiesIf a shareholder is represented
by a proxy, the proxy should be issued with a power of attorney
dated for this day. If the power of attorney is issued by a legal
entity, a certified copy of the registration certificate, or other
document demonstrating the signatory’s authority to sign for the
legal entity, must be included. The power of attorney and any
registration certificate may not be more than one year old, unless
a longer period of validity is stated in the power of attorney (no
more than five years). The power of attorney in original and, if
applicable, registration certificate must be sent to Computershare
AB, “HMS Networks AB’s Annual General Meeting”, Box 610, 182 16
Danderyd, well in advance of the Annual General Meeting. A form of
power of attorney is available on the HMS website
www.hms-networks.com and at the Company’s head
office.Nominee registered sharesShareholders whose
shares are registered in the name of a nominee through a bank or
Securities Register Center must temporarily re-register the shares
in their own name to be able to participate at the Meeting. Such
registration must be done at Euroclear Sweden no later than
Wednesday 17 April 2019, which means that shareholders must notify
their intentions on this matter to the nominee well in advance of
the stated date.Proposed agenda
- Opening of the Meeting
- Election of Chairman of the Meeting
- Preparation and approval of the voting list
- Approval of the Agenda
- Election of one or two persons to approve the minutes
- Determination as to whether the Meeting has been duly
convened
- Presentation of a. the Annual Report, Auditors’ Report and the
Consolidated Accounts and Consolidated Auditors’ Reportb. the
statement by the auditor on the compliance with the current
guidelines for remuneration to senior executivesc. the Board of
Directors proposition according to items 15-16
- Report by the CEO
- Resolution concerninga. the adoption of the Income
Statement and Balance Sheet, and of the Consolidated Income
Statement and Consolidated Balance Sheetb. the allocation of the
Company's profit as set forth in the adopted Balance Sheetc. the
discharge of liability for Board Members and CEO
- Determination of the number of Board Members and Deputies and
Auditors
- Determination of fees payable to Board Members and Auditor
- Election of Board Members
- Election of Auditor
- Determination on guidelines for remuneration to senior
executives
- Resolution on the Board of Directors’ proposal for
authorisation of the Board to resolve on new share issues
- Resolution on the Board of Directors’ proposal for (a)
implementation of a performance-based Share Saving Plan 2020-2023
for all employees, (b) authorisation of the Board to resolve on
repurchase of own shares within Share Saving Plan 2020-2023 and (c)
transfer of own shares to participants in Share Saving Plan
2020-2023.
- Closing of the meeting
The Nomination Committee’s proposalsElection of
Chairman of the Meeting, determination of the number of Board
Members and Deputies and Auditors, determination of fees payable to
Board Members and Auditor and election of Board Members and
election of Auditor (item 2 and 10-13)The Nomination Committee for
2019, comprising Chairman Jan Svensson (Investment AB Latour),
Evert Carlsson (Swedbank Robur Funds), Per Trygg (SEB Funds),
Staffan Dahlström (own holding) and Charlotte Brogren (Chairman of
the Board), proposes:
- that Charlotte Brogren shall be appointed Chairman of the
Annual General Meeting (item 2);
- that the Board of Directors shall consist of six Board Members
without any deputies and that a registered public accounting firm
shall be elected as Auditor (item 10);
- that fees to the Board members shall amount to a total of
SEK 1,625,000 (1,450,000), excluding committee fees, of which
SEK 500,000 (450,000) shall be paid to the Chairman, and
SEK 225,000 (200,000) to each other Board Member, that the fee
for work in the Audit Committee shall amount to SEK 100,000
(50,000) to the Chairman and SEK 50,000 to each other member
in the Audit Committee and that no fees shall be paid for work in
other committees. The fees to the Auditor shall be paid according
to approved invoices (item 11);
- that the Board Members Ray Mauritsson, Charlotte Brogren,
Fredrik Hansson, Anders Mörck, Cecilia Wachtmeister and Ulf
Södergren shall be re-elected as Board members, and that Charlotte
Brogren shall be re-elected as Chairman of the Board (item 12);
and
- that, in accordance with the Audit Committee’s recommendation,
Öhrlings PricewaterhouseCoopers AB is re-elected as the company’s
auditor, with Fredrik Göransson as auditor in charge for a mandate
period of one year (item 13).
Proposals from the Board of DirectorsResolution
concerning the allocation of the Company's profit as set forth in
the adopted Balance Sheet (item 9b)The Board proposes that the
Parent Company’s profit of TSEK 163,817 and retained earnings
of TSEK 17,305, in total TSEK 181,122 is allocated so
that SEK 1.80 per share, corresponding to TSEK 83,909 in
total is distributed to the shareholders as dividend and that the
remaining amount is carried forward. The proposed record date for
the dividend is Monday 29 April 2019. If the Annual General Meeting
resolves in accordance with the proposal, the estimated date for
payment of the dividend from Euroclear Sweden is Friday 3 May 2019.
Determination of guidelines for
remuneration to senior executives (item
14)The Board of Directors’ proposal for
guidelines for remuneration to senior executives entails in
principal that the total remuneration shall be based on market
conditions and be competitive. The benefits shall comprise fixed
salary, variable cash salary, long-term incentive programs, pension
and other benefits. The variable cash salary to the senior
executives shall be based on predetermined and measurable financial
objectives for the group and shall in principal be based on growth
in combination with profitability. In addition, individual
objectives can be determined. Cash variable remuneration shall not
exceed 50 per cent of the fixed salary. Variable remuneration can
also be paid in the form of long-term incentive programs. Pension
benefits shall be fee-based and for the CEO, the pension shall
amount to 35 per cent of the fixed monthly salary up to 28,5 price
base amounts, and to 25 per cent on fixed salary exceeding such
amount. For other senior executives, the ITP-agreement will apply.
The Board shall have the right to deviate from the guidelines in
individual cases if there are particular grounds for such
deviation. Resolution on the Board
of Directors’ proposal for authorisation of the Board to resolve on
new share issues (item 15)The
Board of Directors proposes that the Annual General Meeting
resolves to authorise the Board of Directors to resolve on new
share issues in accordance with the following
conditions:
- The authorisation may be exercised on one or several occasions
up to the Annual General Meeting 2020.
- Maximum 2,340,943 shares, corresponding to approximately 5 per
cent of the company’s share capital, may be issued.
- An issue may be made with or without deviation from the
shareholders’ preferential right.
- An issue may be made against cash payment, by set-off or by
contribution in kind.
- The subscription price shall, at deviation from the
shareholders’ preferential right, be determined in accordance with
market practice. The Board of Directors shall be entitled to
determine other terms of the issue.
The purpose of the authorisation, and the reason for the
deviation from the shareholders’ preferential right, is to enable
the company to finance or carry out, in whole or in part, company
acquisitions with the company’s own shares. There have been
requests from sellers of companies to receive shares in HMS
Networks as payment in conjunction with acquisitions and in case of
acquisitions of smaller entrepreneurial companies it might work as
an important incentive for the seller to receive shares in HMS
Networks.Under the Swedish Companies Act, the resolution of the
General Meeting on authorisation for the Board of Directors to
resolve on new share issues requires the support of shareholders
representing at least two-thirds of both the number of votes cast
and the shares represented at the Meeting in order to be
valid.Resolution on the Board of Directors’ proposal on (a)
implementation of a performance-based Share Saving Plan 2020-2023
for all employees, (b) authorisation of the Board to resolve on
repurchase of own shares within Share Saving Plan 2020‑2023 and (c)
transfer of own shares to participants in Share Saving Plan
2020-2023 (item 16) A. Implementation of performance-based
Share Saving Plan 2020-2023 for all employeesThe Board of Directors
proposes that the Annual General Meeting resolves on implementation
of the below described Share Saving Plan 2020-2023 to all
employees, comprising a maximum of 100 000 shares in the
company, according to the following principal conditions:
- All permanent employees within the group as per 31 December
2019 (approximately 700 persons) will be offered to participate in
the program. In order to participate in the program, the
participant must, with own funds, make an investment of minimum 1%
and maximum between 3% and 6% (depending on position, se item 2
below) of his or her annual fixed gross salary in shares in the
company at market price over Nasdaq Stockholm (“Saving Shares”).
Notification of participation in Share Saving Program 2020-2023
shall be made no later than 31 December 2019. The investment shall
take place during 2020 and shall be made to an amount corresponding
to minimum 1% of the gross salary for 2019, with the possibility to
further investment up to the fixed maximum amount.
- For senior executives (approximately 80 persons), it is
required that the own investment amounts to a minimum of 1% and a
maximum of 6% of the gross salary for 2019. For other employees
(approximately 620 persons), it is required that the own investment
amounts to a minimum of 1% and maximum of 3% of the gross salary
for 2019.
- Each Saving Share entitles the participant to receive free of
charge a maximum of two (2) shares in the company, based on the
achievement of certain performance conditions (“Performance
Share”). The performance conditions are based on the development of
earnings per share according to determined objectives by the Board
of Directors during the financial years 2021 – 2023 (the
“Measurement Period”).
- Upon achievement of the performance conditions, Performance
Shares will be received within 60 days after the day of the
publishing of the year-end report regarding the financial year
2023. Subject to customary exceptions, the participant does not
receive Performance Shares if the participant does not acquire
Saving Shares according to determined minimum level, does not hold
all of his or her Saving Shares up to and including 31 December
2023, or does not remain in his or her employment or equivalent
within the group as per this date. The performance condition that
has to be achieved of exceeded relates to average annual growth of
the company’s earnings per share during the Measurement Period,
whereby Performance Shares is received linearly between the
interval 0-20% and an average annual growth during the Measurement
Period of 20% corresponds to maximum allotment, i.e. two (2)
Performance Shares.
- A small number of selected consultants with assignments of
essential importance for the company should be offered to, on
comparable terms and conditions, participate in Share Saving Plan
2020-2023.
- The Board of Directors shall be responsible for the detailed
terms and conditions of Share Saving Plan 2020-2023 within the
scope the above stated principal terms and conditions, as well as
such reasonable adjustments of the program which are deemed
appropriate or efficient due to legal or administrative conditions.
In addition, the Board of Directors shall have the right to make
minor amendments and deviations from the terms and conditions due
to local rules and occurring market practice.
B. Authorisation for the Board of Directors to resolve on
repurchase of own shares within Share Saving Plan 2020-2023To
enable the company’s delivery of Performance Shares according to
Share Saving Plan 2020-2023, the Board of Directors proposes that
the Annual General Meeting resolves to authorise the Board to
resolve on repurchase of own shares in accordance with the
following conditions:
- The repurchase of shares shall take place on Nasdaq
Stockholm.
- The authorisation may be exercised on one or several occasions
until the Annual General Meeting 2020.
- The repurchase shall as a maximum comprise the number of shares
required for delivery of Matching and Performance Shares to the
participants in Share Saving Plan 2020-2023, however no more than
100,000 shares.
- Repurchase shall be made at a price within the share price
interval registered from time to time, where share price interval
means the difference between the highest buying price and the
lowest selling price.
- Payment of the repurchased shares shall be made in cash.
- The Board of Directors shall have the right to resolve on other
terms and conditions for the repurchase.
The repurchase is expected to take place in conjunction with the
investment period, i.e. during 2020. To the extent that repurchase
must be made after the Annual General Meeting 2020 in order to
ensure delivery of shares according to the program’s maximum
amount, a new authorisation for repurchase of shares is required by
the next Annual General Meeting. C. Transfer of own shares to
participants in the Share Saving Plan 2020-2023To be able to
deliver Performance Shares under Share Saving Plan 2020-2023, the
Board of Directors proposes that the Annual General Meeting
resolves on transfer of own shares in accordance with the following
conditions:
- A maximum number of 100,000 shares may be transferred free of
charge to participants in Share Saving Plan 2020-2023.
- With deviation from the shareholders’ preferential rights, the
right to acquire shares free of charge shall comprise persons
within the group participating in Share Saving Plan 2020-2023, with
a right for each of the participant to acquire the maximum number
of shares stipulated in the terms and conditions of the Share
Saving Plan 2020-2023.
- Transfer of shares shall be made free of charge at the time
for, and according to the terms for, the allotment of shares to
participants in Share Saving Plan 2020-2023.
- The number of shares that may be transferred under Share Saving
Plan 2020-2023 may be recalculated due to any intervening split or
reverse share split, bonus issue, preferential issue and/or similar
corporate actions.
The reason for deviation from the shareholders' preferential
rights is to enable the Company to transfer Performance Shares to
the participants in Share Saving Plan 2020-2023. Estimated
costsThe program will generate costs related to the application of
IFRS 2 “Share-related remuneration” amounting to approximately
MSEK 15 and costs for social security contributions of
approximately MSEK 5 for the shares which are allotted free of
charge. The total effect on the income statement is estimated to
amount to approximately MSEK 20, distributed over the years
2020-2023.Costs according to IFRS 2 do not affect the cash flow or
equity during the duration of the Share Saving Plan. The
acquisition cost of the shares is estimated to approximately
MSEK 15 and will effect the cash flow and equity in connection
with acquisition of the shares. The social security contributions
effect the equity continuously, but the cash flow only in 2024,
after that the shares has been allotted. Administrative costs for
the program is estimated to amount to MSEK 0.8 during the
duration of the program.The above cost-estimate is based on
assumptions that just over half of the employees participate in the
program, that all participants remains until the end of the
program, an investment level per participant based on historical
outcome and a maximum outcome on the performance conditions
corresponding to two (2) Performance Shares per Saving Share. For
the share price at the end of the program, a development
corresponding to the outcome of the performance condition earnings
per share has been assumed. Reason for the proposalThe Board of
Directors’ reason for the abovementioned proposal on Share Saving
Plan 2020-2023 is that a personal long-term owner commitment in the
company by the employees is expected to stimulate an increased
interest for the company’s operation and earnings, and to increase
the motivation and affinity with the company. The offering and
participation in the Share Saving Plan shall be considered as a
part of the total remuneration package. Therefore, the Board of
Directors assesses that the Share Saving Plan is favorably for both
the company and its shareholders. It is the Board of Directors’
intention to annually return to the Annual General Meeting with
proposals for share saving plans with equivalent conditions and
effects. In case the conditions for the assumptions on number of
employees that may be offered to participate in the share saving
program or otherwise that is the basis for the calculations of the
maximum size of the program change, the Board of Directors’ intends
to return with a supplementary proposal to the Annual General
Meeting 2020 regarding repurchase and transfer of own shares within
Share Saving Plan 2020-2023, in order to ensure that all employees
as per 31 December 2019 who wish to participate in the program can
do so. Effects on key ratiosAs per the date of the Board of
Directors’ proposal, the number of shares in the Company amounts to
46,818,868. The Share Saving Plan 2020-2023 is expected to result
in acquisition and transfer of a total of approximately 100,000
shares, which corresponds to approximately 0.21% of the total
number of outstanding shares and votes. The key ratio earnings per
share is not expected to be effected substantially.Majority
resolutionDecision on the Board of Directors’ proposal under items
A, B and C shall be made as a joint decision. The proposal, to be
valid, must be supported by shareholders holding at least
nine-tenths of both the number of votes cast, as well as of the
number of shares represented at the meeting.Information at
the Annual General Meeting The Board and the CEO shall at
the Annual General Meeting, if any shareholder so requests and the
Board believes that it can be done without significant harm to the
company, provide information regarding circumstances that may
affect the assessment of an item on the agenda, circumstances that
can affect the assessment of the company’s or its subsidiaries’
financial position and the company’s relation to other companies
within the group.Available documentsThe Annual
Report and Auditor’s Report for the Parent Company and the group
for the 2018 financial year, the Board of Directors reasoned
statement regarding the proposal for dividend, the Nomination
Committee’s reasoned statement and the Board of Directors complete
proposal regarding items 14-16 and the auditors’ statement on
whether the current guidelines for remuneration to senior
executives have been complied with, will be available at the
company and on the company’s website, www.hms‑networks.com, as of 4
April 2019, and will be sent to all shareholders who so request and
state their postal address. A printed version of the Annual Report
may be received by sending address details to ir@hms.se.
Number of shares and votes in the
companyAt the time of this notice, the total
number of shares and votes in the company amounts to 46,818,868.
The company’s holding of own shares amounts to 202,999, which do
not entitle to any voting right as long as the company is the
holder of the shares.Processing of personal
dataFor information on processing of personal data, see
https://www.euroclear.com/dam/ESw/Legal/Privacy-notice-bolagsstammor-engelska.pdf.
....................................................
Halmstad, March 2019
HMS Networks AB (publ)
The Board of Directors
For more information please contact: CEO
Staffan Dahlström, phone: +46-35-17 29 01 CFO Joakim Nideborn,
phone: +46-35-710 69 83 HMS Networks AB
(publ) is the leading independent supplier of solutions
for industrial communication and the Industrial Internet of Things.
HMS develops and manufactures products under the Anybus®, Ixxat®
and Ewon® brands. Communication solutions for building automation
are offered through the subsidiary Intesis. Development and
manufacturing take place at the headquarters in Halmstad, and in
Ravensburg, Nivelles, Igualada and Wetzlar. Local sales and support
are handled by branch offices in Germany, USA, Japan, China,
Singapore, Italy, France, Switzerland, Spain, India, UK, Sweden,
Finland, South Korea and UAE, as well as through a worldwide
network of distributors and partners. HMS employs over 600 people
and reported sales of SEK 1,366 million in 2018. HMS is listed on
the NASDAQ OMX in Stockholm, category Mid Cap, Information
Technology.
- PRM - Notice of the Annual General Meeting 2019