Notice of Annual General Meeting of Eniro AB

Welcome to the annual general meeting of Eniro AB (publ), reg. no 556588–0936, (”Eniro” or the “Company”) Tuesday 16 June 2020 at 16.00 in Helio’s premises, Kista Timebuilding, Kistagången 12, in Kista. Registration to the annual general meeting starts at 15.00.

PRECAUTIONARY MEASURES CONCERNING RISK OF SPREAD OF THE CORONA VIRUS

At the time of issuing this notice, the Swedish Public Health Authority (Sw. Folkhälsomyndigheten) estimates that the risk of spreading the corona virus (COVID-19) is very high. To reduce the overall risk of infection, the current recommendation from the authority is to avoid big crowds and overcrowded areas.

The well-being of shareholders and staff is of great importance to the Company, as well as the shareholders’ ability to exercise their rights at the annual general meeting. As a result, the Company will take the following security measures to reduce the risk of spreading the corona virus at the annual general meeting:

• The annual general meeting will be as efficient and concise as possible.
• There will be no informal meetings with the Company’s representatives in connection with the meeting. Participation from the Company (including members of the board and group management) will be limited to a minimum.
• Food or drink will not be served before, during or after the meeting.
• Shareholders are given the opportunity to exercise their voting rights at the meeting by post.

The Company would like to emphasize that shareholders who are concerned about the spread of infection have the opportunity to avoid attending the annual general meeting in person and instead exercise their voting rights by post (see section “Postal voting” below) or appoint a representative who can vote on their behalf (see section “Proxy and proxy form” below). The Company recommends postal voting for all those who have symptoms of disease or who have been in contact with people who have symptoms of disease or who belong to a risk group.

The extent of the continued spread of the corona virus is still difficult to assess and the Company is following the development closely. If further changes regarding the annual general meeting need to be made, information on this will be published on the Company’s website, www.enirogroup.com.

Participation

Shareholders who wish to attend the meeting must:

• be entered as a shareholder in the share register kept by Euroclear Sweden AB on Wednesday 10 June 2020, and
• give notice to the Company of their intention to participate no later than Friday 12 June 2020.

The notice may be made in writing to Eniro AB, ”AGM”, Eniro AB, Box 7044, 164 07 Kista, Sweden or through e-mail at bolagsstamma@eniro.com. Shareholders who are natural persons also have the opportunity to register on Eniro’s website, www.enirogroup.com. The registration must state the name, personal identity number or company registration number, address, telephone number and the number of any assistants.

Shareholders whose shares are registered in the name of a nominee must arrange for those shares to temporarily be re-registered in their own names in order to be entitled to participate in the general meeting. Such re-registration must be completed on Wednesday 10 June 2020 and should be requested from the bank or nominee well in advance of this date.

POSTAL VOTING

Shareholders can exercise their voting rights at the annual general meeting by post. In case of postal voting, shareholders must use the postal voting form and follow the Company’s instructions available on the Company’s website, www.enirogroup.com. Please note that postal votes must be delivered to the Company at the address stated in the postal voting form no later than Friday, 12 June 2020.

PROXY AND PROXYFORM

Shareholders who participate through proxies or representatives should send authorization documents (proxy and/or registration certificate) to the Company at the above postal address well in advance of the meeting. A proxy form is available on Eniro’s website, www.enirogroup.com.

PERSONAL INFORMATION

Personal information regarding shareholders retrieved from the share register, notification of attendance to the general meeting and information on proxies and assistants will be used for registration, preparation of voting register for the general meeting and, where applicable, in the minutes of the general meeting. Personal data is processed in accordance with the Data Protection Regulation (Regulation (EU) 2016/679 of the European Parliament and of the Council). For further information on the Company’s processing of personal data and your rights, see the Company’s website, www.enirogroup.com under the heading "Privacy policy" (which is found under the section "Investors" and the sub-section "The Share").

PROPOSED AGENDA

1. Opening of the meeting.
2. Election of chair of the meeting
3. Preparation and approval of voting register
4. Adoption of agenda
5. Election of two persons to verify the minutes of the meeting
6. Determination of whether the meeting was duly convened
7. Speech of the CEO
8. The chairman’s account of the work of the board of directors and its committees during 2019
9. Presentation of the annual report and the auditor’s report, the consolidated accounts and the consolidated auditor’s report and the auditor’s opinion on whether the guidelines for remuneration to senior executives have been followed
10. Resolution on adoption of the income statement and balance sheet as well as the consolidated income statement and consolidated balance sheet
11. Resolution on allocation of the Company’s profit or loss according to the adopted balance sheet
12. Resolution on discharge from liability for members of the board of directors and CEO for the period of the accounts
13. Determination of the number of members of the board of directors and board deputies and the number of auditors and auditor deputies
14. Determination of fees for the directors and auditors
15. Election of the board of directors, chairman and any deputies
16. Election of auditors and any auditor deputies
17. Resolution on guidelines for remuneration to the senior management
18. Presentation of the balance sheet for liquidation purposes and the auditor’s report with respect thereto, and decision on whether the Company shall be liquidated
19. Resolution on support for the composition offer, amendments to the articles of association and authorization for the board of directors to decide on new issue(s) of shares
20. Resolution on authorization for the board of directors to decide on new issue(s) of ordinary shares
21. Closing of the meeting

Proposed resolutions

Item 2 – Election of chair of the meeting

The nomination committee for the annual general meeting 2020 consists of Theodor Jeansson, the chairman of the nomination committee (own holdings), Ilija Batljan (own holdings and through companies), Johnny Sommarlund (appointed by MGA Placeringar AB), Carl Rosvall (appointed by Hajskäret Invest AB) and Arne Myhrman (chairman of the board of directors of Eniro).

The nomination committee proposes that the chairman of the board Arne Myhrman be elected chairman of the meeting.

Item 11 – Resolution on allocation of the Company’s profit or loss according to the adopted balance sheet

The board of directors proposes that the annual general meeting 2020 resolves that no dividend shall be paid, neither on the ordinary shares nor the preference shares, and that the result according to the adopted balance sheet is transferred into the new accounts.

Item 13 – The number of board members and the number of auditors

The nomination committee proposes that:    

• the board shall have five board members (unchanged) and no deputies (unchanged), and
• the number of auditors shall be one registered accounting firm without a deputy auditor (unchanged).

Item 14 – Fees for the board of directors and auditors

The nomination committee proposes the following fees to the board of directors and the auditor:

• a total of SEK 1,755,000 (a decrease of a total of SEK 595,000) to be distributed by SEK 675,000 to the chairman of the board (a decrease of SEK 75,000) and SEK 360,000 to each of the other directors elected by the general meeting not being employed by the Company (a reduction of SEK 40,000 per board member who is not employed by the Company),
• in addition to the board fees, no remuneration for committee work (unchanged),
• SEK 1,500 per meeting for each employee representative (as study fee) (unchanged), and
• auditor’s fees according to approved invoices.

Item 15 – Election of the board of directors and chairman

The nomination committee proposes that:    

• Johnny Sommarlund, Henrik Salwén, Magdalena Bonde, Urban Hilding and Arne Myhrman are re-elected as directors of the board, and
• Arne Myhrman is re-elected as chairman of the board.

Information on the persons proposed by the nomination committee as directors of the board is available on Eniro’s website, www.enirogroup.com.

Item 16 – Election of auditor

The nomination committee, in accordance with the audit committee’s recommendation, proposes re-election of the auditing firm PricewaterhouseCoopers AB as auditor for the period to the end of the annual general meeting 2021. PricewaterhouseCoopers has informed the Company that Carl Fogelberg will be the auditor in charge, provided that re-election takes place. The nomination committee proposes that a renewed procurement of auditors be carried out for the annual general meeting 2021.

Item 17 – Guidelines for remuneration to senior executives

The board of directors proposes that the annual general meeting of 2020 resolves to adopt, for the period until the annual general meeting 2021, the following guidelines for remuneration to senior executives. The proposal for the 2020 annual general meeting is essentially in line with the guidelines adopted by the annual general meeting in 2019. The guidelines shall be applicable on the remuneration to the CEO and other persons in the group management (currently in total eight persons).

The board of directors shall be entitled to temporarily deviate, in whole or in part, from the guidelines for remuneration to senior executives if there are special reasons for doing so in an individual case and an exception is necessary to meet the Company’s long-term interests, including its sustainability, or to ensure the Company’s financial viability. Deviations shall be reported in the remuneration report for the next annual general meeting.

Guidelines for promoting the Company’s business strategy, long-term interests and sustainability

Eniro has made a journey of change from being a directory company and online search company to becoming a digital marketing partner for small and medium-sized businesses. In view of the rapidly changing market in digital marketing and in a challenging time, the Company has in recent years worked hard to recapitalize the Company and implement a new strategy. The Company is currently undergoing a formal corporate restructuring (Sw. företagsrekonstruktion) to seek a long-term recapitalization of the Company and its continued operations. The board of directors considers it critical to the success of implementing the Company’s business strategy and to safeguard the Company’s long-term interests, including its sustainability, that the Company can offer competitive remuneration that motivates senior executives to do their utmost.

Forms of compensation etc.

The goal for Eniro is to offer a market-based remuneration consisting of fixed salary, variable cash salary (if applicable) and pension provisions and other remuneration and benefits. In addition, the general meeting may from time to time decide on share and share price related remuneration.

The fixed salary is based on the individual executive’s area of responsibility, expertise and experience. Goals for any variable cash salary components shall be determined by the board of directors beginning 1 January 2020 and shall be based on the outcome in relation to defined and measurable goals, both common and individual goals, and be maximized in relation to the fixed salary. Any variable remuneration shall be linked to predetermined and measurable criteria based on the outcome of the Company’s adjusted EBITDA and turn-over. The purpose of these criteria is to promote long-term value creation. The measurement period for variable remuneration is 12 months. Any variable cash salary components are limited to a maximum of 40 percent of the fixed salary. Bonus compensation does not entitle to pension provisions or holiday provisions. The Company shall have the right to demand repayment of variable salary if a payment is based on information that later proved to be manifestly incorrect. Payment of part of any variable salary shall be conditional on the achievement of the underlying goals in a long-term sustainable way.

The ordinary retirement age is 65 years. Eniro’s pension policy is based on either an individual occupational pension plan or a premium-based pension plan with a maximum of 35 percent of the fixed salary.

Other remuneration and benefits, such as Company car and health insurance, must be market-based and may not exceed 10 per cent of the fixed salary.

Salary and terms of employment for employees

When preparing proposals for these remuneration guidelines, salaries and terms of employment for the Company’s employees have been taken into account by considering the employees’ total remuneration, the components of the remuneration and the rate of increase and increase over time, which all has formed part of the remuneration committee and the board’s decision basis when evaluating the reasonableness of the guidelines and the guidelines that follows from these. The development of the difference between the remuneration of the senior executives and the remuneration of other employees will be reported in the remuneration report.

Termination notice and severance pay

The notice period for the CEO and senior executives is normally six months. Severance pay is not paid.

The decision-making process to establish, review and implement the guidelines

The board of directors determines any variable cash salary based on annual evaluations of individual executive’s compliance with the objectives. The board has established a remuneration committee. Since 2018, the entire board performs the tasks of the committee.

The remuneration committee shall (a) prepare the board’s decision on matters relating to remuneration, including principles for variable remuneration, remuneration, including outcomes of variable remuneration and other terms of employment for the CEO and company management (b) monitor and evaluate ongoing and completed variable remuneration programs for the CEO and company management during the year, (c) follow and evaluate the application of the guidelines for remuneration to senior executives that the annual general meeting is required by law to decide on, as well as current remuneration structures and remuneration levels in the Company, and (d) prepare the board of directors’ proposal of guidelines for remuneration to senior executives to be presented at the annual general meeting.

The remuneration committee shall prepare any proposals for shareholders’ resolutions regarding share or share price-related incentive programs to the company management, stating in particular the reasons for the program, significant terms and conditions, any dilution effects and what the program can be expected to cost for the Company in various plausible outcomes.

The CEO shall not participate in the preparation of decisions or guidelines regarding the CEO’s remuneration or terms of employment.

The guidelines adopted by the annual general meeting 2019 have been followed.

Item 18 – Presentation of the balance sheet for liquidation purposes and the auditor’s report with respect thereto, and decision on whether the Company shall be liquidated

On 30 March 2020, the Company applied for corporate restructuring. The application for corporate restructuring was approved by the Solna District Court on the same day and Advokat Lars Eric Gustafsson, Law Firm Schjødt, was appointed as reconstructor.

On 27 April 2020, the board of directors prepared a special balance sheet for liquidation purposes in accordance with Chapter 25, Section 13 of the Swedish Companies Act (Sw. Aktiebolagslagen) (the “Companies Act”). The board has procured that the Company’s auditor reviewed the special balance sheet for liquidation purposes, and the auditor has issued an opinion in relation thereto. The special balance sheet for liquidation purposes and the auditor’s opinion in relation thereto are available on the Company’s website, www.enirogroup.com. The special balance sheet shows that the Company’s equity is less than half of the registered share capital. The general meeting should therefore consider whether the Company should go into liquidation or continue operations. The board of directors considers that it is possible to restore the Company’s share capital during the ongoing corporate restructuring. The board of directors therefore recommends that the annual general meeting decides on continued operations. However, in accordance with the rules in the Companies Act, the board has also drawn up a proposal for liquidation for the annual general meeting to consider.

Firstly, the board of directors proposes continued operations

A decision on continued operations means that an extraordinary general meeting need to be held within eight months of this initial meeting for liquidation purposes (also the annual general meeting) to again resolve on the question of whether the Company should go into liquidation, a so called second meeting for liquidation purposes. Prior to the second meeting for liquidation purposes, the board of directors shall prepare another special balance sheet for liquidation purposes and have it reviewed by the Company’s auditor. If this second special balance sheet for liquidation purposes does not show that the equity has been restored and amounts to at least the registered share capital, the Company is under an obligation to enter into liquidation.

Due to the board of directors’ assessment that there are possibilities for restoring the Company’s share capital during the ongoing corporate restructuring, the board of directors proposes that the general meeting decides that the Company should not go into liquidation.

Secondly, the board of directors proposes that the Company go into liquidation

Despite the recommendation by the board of directors that the general meeting decides on continued operations, the board of directors is under an obligation under the Companies Act to also prepare a proposal for the general meeting that the Company should go into liquidation. If the general meeting decides that the Company should go into liquidation, it is proposed that the decision should apply from the date when the Swedish Companies Registration Office (Sw. Bolagsverket) has registered the decision and a liquidator has been appointed by the Swedish Companies Registration Office. In the event of a liquidation, no distribution proceeds are expected to be paid out and thus the board of directors cannot state any estimated time for any such distribution of the Company’s assets. The board of directors has no proposal for a liquidator.

Item 19 – Resolution on support for a composition offer (Sw. ackordserbjudande), amendments to the articles of association and authorization for the board of directors to decide on new issue(s) of shares

The Company is intending to propose a composition offer of 25 percent for the Company’s completely or partially non-prioritized creditors. The Company has pledged the shares in Eniro Treasury AB as security for its obligations under the Company’s bond. The bondholders will participate in the composition offer with respect to the portion of the bond receivable that exceeds the value of the share pledge. In connection with the composition offer, the Company intends to offer preference shares to the creditors in order to limit the cash amount that will be required for the payment of the composition compensation. The offer of preference shares will be directed to the bondholders, also with respect to the portion of the bond receivable which is secured by the share pledge.

PROPOSAL 1: THE BOARD OF DIRECTORS PROPOSAL FOR RESOLUTIONS IN ACCORDANCE WITH THIS ITEM 19

In light of the above proposal, the board of directors proposes the following.

1. That the general meeting confirms its support for the above mentioned composition offer.

2. That the general meeting resolves to change the limits for share capital and the number of shares by the following amendments to the articles of association.

The first paragraph under § 4 “Share Capital”, shall read as follows:

The share capital shall amount to not less than SEK 400,000,000 and not more than SEK 1,600,000,000.

§ 5 “Number of shares”, shall read as follows:

The number of shares shall be not less than 400,000,000 shares and not more than 1,600,000,000 shares.

3. That the general meeting resolves to authorize the board of directors to decide, on one or more occasions during the period leading up to the next annual general meeting, with deviation from the shareholders’ preferential rights, on new issues of preference shares of series A to the Company’s creditors. The new issued shares can be subscribed for with payment in kind, payment with set-off rights or under the terms referred to in Chapter 2, Section 5 of the Companies Act. The purpose of the authorization and any deviation from the shareholders’ preferential rights is that new share issue(s) can be made to strengthen the Company’s equity and regulate the Company’s debts.

The board of directors further proposes that the annual general meeting authorizes the CEO, with full power of substitution, to make such minor adjustments and clarifications of the general meeting’s decisions that may prove necessary in connection with the registration with the Swedish Companies Registration Office and Euroclear. The board's proposal 1 regarding amendments to the articles of association in accordance with item 19.1(b) presupposes for registration with the Swedish Companies Registration Office that the board utilizes the authorisation in accordance with proposal 19.1(c) and issues preference shares of series A to a sufficient extent.

PROPOSAL 2: SHAREHOLDER’S PROPOSAL REGARDING AMENDMENT OF THE ARTICLES OF ASSOCIATION

The Company has received a proposal from a shareholder representing 422 preference shares according to the Company’s share register as of 30 April 2020. The shareholder proposes that a resolution is made to amend the articles of association so that it will have the same wording as before 2020-03-02.

Since the board of directors’ proposal 1 in accordance with this item 19 regarding, among other things, amendments to the articles of association and that the board of directors shall be authorized to resolve upon issue(s) of preference shares of series A in order to enable a recapitalization of the Company within the scope of the corporate restructuring is not compatible with the shareholder’s proposal 2, the board of directors considers that the shareholder’s proposal 2 is not in the best interests of the Company or its shareholders and therefore recommends that the general meeting votes in favour of the board’s proposal 1 above.

MISCELLANEOUS

Since the board’s proposal 1 and the shareholder’s proposal 2 is not compatible with each other the proposals will need to be opposed to each other. The shareholders will therefore need to either vote in favour of the board’s proposal 1, the shareholder’s proposal 2 or reject both proposals.

Item 20 – Resolution on authorization for the board of directors to decide on a new issue of ordinary shares

The board of directors proposes that the annual general meeting resolves to authorize the board of directors to resolve, on one or more occasions during the period leading up to the next annual general meeting, with or without deviation from the shareholders’ preferential right, to issue new ordinary shares. A new share issue under this authorization, which deviates from the shareholders’ preferential rights, may consist of as many ordinary shares that corresponds to a maximum of thirty (30) percent of the total number of issued ordinary shares in the Company at the time the authorization was first exercised. The newly issued shares can be subscribed for with payment in cash, with payment in kind, with payment with set-off rights or under the terms referred to in Chapter 2, Section 5 of the Companies Act. A new share issue which has been resolved upon on the basis of the authorization and that deviate from the shareholders’ preferential rights shall be made at a market subscription price, subject to a market-based discount for directed new share issues (private placements). In case of a preferential rights share issue, the subscription price may be set at a lower amount than the market value of the share. The purpose of the authorization and any deviation from the shareholders’ preferential right is that a new share issue can be made to strengthen the Company’s equity, in order to enable acquisitions of all or part of companies or businesses, and in order to capitalize the Company for such acquisitions. The CEO, or a person appointed by the board of the directors, shall have the right to make the minor adjustments to the decision that may be required in connection with registration with the Swedish Companies Registration Office, including, where appropriate, transfer of funds to the Company’s restricted equity.

Specific majority requirements

Resolutions in accordance with the proposals in item 19 and 20 are only valid if supported by at least two thirds of the votes cast as well as of the shares represented at the general meeting.

Shares and votes

The total number of shares in the Company per the date of the notice amounts to 66,832,187 shares, of which 66,573,410 are ordinary shares of series A with one vote each and 258,777 preference shares of series B with one-tenth of a vote each, which corresponds to a total of 66,589,287.7 votes. At the same time, the Company holds the following treasury shares which cannot be represented at the general meeting; 17,037 ordinary shares of series A, corresponding to the same number of votes, as well as 3,368 preference shares of series B with one-tenth of a vote each.

Information at the annual general meeting

The board of directors and the CEO shall, if any shareholder so requests and the board of directors considers that this can be done without considerable harm to the Company, provide information on circumstances that may affect the assessment of a matter on the agenda, circumstances that may affect the assessment of the Company’s or a subsidiary’s financial situation and the Company’s relationship with other group companies.

Documents

The proposal of the board of directors and the nomination committee, as well as other documents that must be available in accordance with the Companies Act and the Swedish Code of Corporate Governance, are available at the Company, at Kistagången 12 in Kista, and on the Company’s website, www.enirogroup.com, at least three weeks before the general meeting and sent to the shareholders who specifically request it and provide their postal address.

______________________

Stockholm in May 2020

Eniro AB (publ)

The Board of Directors

The English text is an unofficial translation of the Swedish original. In case of any discrepancies between the Swedish text and the English translation, the Swedish text shall prevail.