SUMMARY FROM ANNUAL GENERAL MEETING OF EPISURF MEDICAL AB (PUBL)
Episurf Medical AB (publ) (“Episurf” or the “Company”) held its Annual General Meeting (the “Meeting”) on Monday, 10 May 2021. Due to the Covid-19 pandemic and the restrictions that have been introduced to limit the spread of Covid-19, the Meeting was held without the physical presence of shareholders, proxies or third parties and shareholders had the opportunity to exercise their voting rights by post prior to the Meeting in accordance with Sections 20 and 22 of the Swedish Act on Temporary Exemptions to Facilitate the Execution of General Meetings in Companies and Associations.
The income statements and the balance sheets for the Company and the group were approved and the Board of Directors and the CEO were discharged from liability for the financial year 2020.
The Meeting resolved, in accordance with the proposal of the Board of Directors, that the Company shall not pay dividends for the financial year 2020.
The Meeting resolved to approve the remuneration report for the financial year 2020.
In accordance with the proposal by the Nomination Committee, Dennis Stripe, Christian Krüeger, Leif Ryd and Laura Shunk were re-elected, Annette Brodin Rampe and Ulf Grunander were newly elected as members of the Board of Directors and Dennis Stripe was re-elected as Chairman of the Board of Directors. Wilder Fulford had informed the Nomination Committee that he was not available for re-election.
In accordance with the proposal by the Nomination Committee, the Meeting resolved that total fees of SEK 1,300,000 (2020: SEK 1,100,000) are to be paid to the Board of Directors, of which SEK 400,000 to the Chairman of the Board of Directors, SEK 200,000 to each of Christian Krüeger, Laura Shunk, Annette Brodin Rampe and Ulf Grunander as well as SEK 100,000 to Leif Ryd. No fees are to be paid for committee work.
In accordance with the proposal by the Nomination Committee, the registered accounting firm KPMG AB was re-elected as the auditor of the Company, with the authorised public accountant Duane Swanson as the auditor in charge. The auditors’ fee shall be paid upon approval of their invoice.
The Meeting approved the Nomination Committee’s proposal on the nomination procedure and instruction for the Nomination Committee for the Annual General Meeting 2022.
The Meeting approved the Board of Directors’ proposal regarding guidelines for remuneration to senior executives.
In accordance with the proposal by the Board of Directors, the Meeting resolved on (i) adoption of an incentive programme based on performance based employee stock options for certain employees and (ii) an issue of warrants of series 2021/2024(A) and approval of transfers of warrants of series 2021/2024(A). The incentive programme includes certain employees in the Episurf group (up to 20 persons, including Episurf’s senior management).
No more than 2,355,988 performance options will be issued. The performance options are hedged by an issue of no more than 2,355,988 warrants of series 2021/2024(A) to the subsidiary Episurf Operations AB.
The performance options will be allotted to the participants free of charge in accordance with the following: (i) the CEO is allotted 785,499 performance options, (ii) the other members of the senior management (four persons) are allotted 886,346 performance options in total, of which no participant within this category may be allotted more than 250,355 performance options and (iii) the other participants (up to 15 persons) are allotted 684,143 performance options in total, of which no participant within this category may be allotted more than 66,208 performance options.
Provided that the participant is still employed by the Episurf group at the exercise of the performance options, each performance option entitles the employee to purchase one share of series B in the Company at the expiry of a vesting period of three years from the allotment of the performance options for a price of SEK 4.07 per share of series B. Furthermore, the performance options are subject to certain performance targets for the financial year 2021, which determine to what extent the employees are entitled to keep and exercise the performance options.
The programme means that a maximum of 2,355,988 shares of series B may be issued, corresponding to a maximum dilution of approximately 1 per cent of the number of shares and votes in the Company.
In accordance with the proposal by the Board of Directors, the Meeting resolved on (i) adoption of an incentive programme for the CEO, (ii) an issue of warrants of series 2021/2024(B) (the “Incentive Warrants”) and approval of transfer of Incentive Warrants and (iii) an issue of warrants of series 2021/2024(C) (the “Hedge Warrants”) and approval of transfer of Hedge Warrants.
The programme means that no more than 1,651,427 Incentive Warrants and no more than 732,734 employee stock options will be issued. The employee stock options and related costs are hedged by an issue of no more than 962,959 Hedge Warrants to the subsidiary Episurf Operations AB.
The employee stock options will be allotted to the CEO free of charge. The CEO is entitled to acquire the Incentive Warrants at a price (premium) corresponding to the Incentive Warrants’ market value. The CEO will receive a cash bonus from the Company to finance the acquisition of the Incentive Warrants. The amount of the bonus will correspond to the total price for the Incentive Warrants, excluding the tax payable by the CEO on the bonus amount, meaning that the CEO will finance such part of the total price for the Incentive Warrants that corresponds to the income tax.
Each Incentive Warrant will, following a three-year vesting period, entitle the CEO to subscribe for shares of series B at a subscription price per share of series B that corresponds to the quota value of the share. The CEO will be entitled to acquire a maximum of 1,651,427 Incentive Warrants, which will entitle the CEO to subscribe for a number of shares of series B in the range of 0–1,279,875 shares of series B, depending on the development of the share price of the Company’s share of series B compared to the current share price of the share of series B. The number of shares of series B that the Incentive Warrants will entitle to subscription for will be calculated so that the value of this number of shares corresponds to the difference between the price of the share at the time of subscription less SEK 4.07 (which corresponds to 120 per cent of the volume-weighted average of the price for the Company’s share of series B on Nasdaq Stockholm during the period from and including 3 May 2021 up to and including 7 May 2021).
Provided that the CEO is still employed by the Episurf group at the exercise of the employee stock options, each employee stock option entitles the CEO to purchase one share of series B in the Company during the period from and including 1 July 2024 until and including 30 June 2025 for a price of SEK 4.07 per share of series B. Furthermore, the employee stock options are subject to certain performance targets for the financial years 2021–2023, which determine to what extent the CEO is entitled to keep and exercise the employee stock options.
The programme entails that a maximum of 2,012,609 shares of series B in the Company may be issued to the CEO. In addition, the Company will issue 230,225 Hedge Warrants to hedge costs, primarily social security contributions, relating to the employee stock options which may entail that an additional 230,225 shares of series B are issued. Accordingly, the programme may entail that a maximum of 2,242,834 shares of series B are issued, corresponding to a maximum dilution of approximately 1.0 per cent of the total number of shares and votes in the Company.
Finally, the Meeting resolved to authorise the Board of Directors to, during the period until the next Annual General Meeting, on one or more occasions, with or without deviation from the shareholders’ preferential rights, resolve on new issues of shares, convertibles and/or warrants in the Company. The authorisation shall be limited whereby the Board of Directors may not resolve to issue shares, convertibles and/or warrants that, on a fully diluted basis, represent more than 20 per cent of the total number of shares in the Company. Payment may, except for in cash, be made in kind, by right of set-off or otherwise against markets terms according to the Board of Directors’ assessment on a case-by-case level.
Episurf Medical AB (publ)
The Board of Directors
For more information, please contact:
Pål Ryfors, CEO, Episurf Medical
Tel:+46 (0) 709 62 36 69
Email: pal.ryfors@episurf.com
Veronica Wallin, CFO, Episurf Medical
Tel:+46 (0) 700 37 48 95
Email: veronica.wallin@episurf.com
About Episurf Medical
Episurf Medical is endeavoring to bring people with painful joint injuries a more active, healthier life through the availability of minimally invasive and individualised treatment alternatives. Episurf Medical’s Episealer® individualised implants and Epiguide® surgical drill guides are developed for treating localised cartilage injury in joints. Episurf Medical’s μiFidelity® system enables implants to be cost-efficiently tailored to each individual’s unique injury for the optimal fit and minimal intervention. Episurf Medical’s head office is in Stockholm, Sweden. Its share (EPIS B) is listed on Nasdaq Stockholm. For more information, go to the company’s website: www.episurf.com.
The information in this press release is information that Episurf Medical AB (publ) is obliged to make public pursuant to Nasdaq Stockholm's Rule Book for Issuers. The information was submitted for publication, through the agency of the contact persons set out above, at 13:30 CEST on 10 May 2021.
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