Notice of Annual General Meeting
Shareholders in JM AB are hereby invited to attend the Annual General Meeting to be held at 4:00 pm on Thursday April 28, 2011, at JM’s head office, located at Gustav III:s boulevard 64 in Solna, Sweden.
Shareholders who wish to participate at the Annual General Meeting must be:
a) entered in the register of shareholders maintained by Euroclear Sweden AB by Wednesday, April 20, 2011, and
b) must have informed the Company of their intention to participate by 4:00 pm on Wednesday, April 20, 2011, using one of the following channels:
JM ABs website: www.jm.se (only for private individuals)
E-mail: monica.charron@www.jm.se
Mail: JM AB, SE-169 82 Stockholm
Telephone: +46 (0)8-782 87 00
Fax: +46 (0)8-782 86 24
In order to be entitled to participate at the Meeting, shareholders whose shares are registered in the name of a nominee must request that their shares be temporarily registered in their own name in the register of shareholders by Wednesday, April 20, 2011.
Admission cards to the Annual General Meeting will be sent out.
REPRESENTATIVE
Shareholders represented by proxy shall issue a power of attorney for the proxy. If the proxy is issued by a legal person, a certified copy of a valid registration certificate for the legal person must be appended. The proxy in the original and registration certificate (if required) should be sent well in advance of the Meeting to JM AB, Legal Affairs and Development, SE-169 82 Stockholm, Sweden.
A proxy form is available on the JM AB website, www.jm.se. The proxy form will also be sent to those shareholders who request it and provide their mailing address.
SHARES AND VOTES
JM AB's share capital amounts to SEK 83,404,177, equivalent to 83,404,177 ordinary shares and 0 Class C shares. Ordinary shares carry one vote and Class C shares carry one tenth of a vote. As at March 30, 2011 the Company holds 164,307 own ordinary shares, equivalent to the same number of votes.
DOCUMENTS
The accounts, the auditor’s report, the Board of Directors’ reasoned statements, the auditor’s statement according to chapter 8 section 54 of the Swedish Companies Act as well as the Board of Directors’ complete proposal as set forth in item 18 below will be available no later than April 7, 2011, at JM AB's head office, Gustav III boulevard 64, Solna, and on the JM AB website, www.jm.se under the tab “About JM – Corporate Governance.” The documents referred to above will also be sent to those shareholders who request them and provide their mailing address. They will also be available at the Annual General Meeting.
Shareholders are advised that the evaluations of
- current programs for variable compensation for senior management as well as those that concluded during the year,
- application of the guidelines for benefits to senior executives adopted by the 2010 AGM, and
- compensation structures and remuneration levels within the JM Group
are presented on JM AB's website under the tab “About JM – Corporate Governance” in compliance with point 10.3 of the Swedish Code of Corporate Governance. The evaluations in question were carried out by the Compensation Committee, which was established by the Board of Directors of JM AB. The conclusion of the evaluations is that the compensation systems are well designed and effective and that the compensation levels are market-based.
OTHER
Upon request by any shareholder and where the Board believes that such may take place without significant harm to the Company, the Board and the President shall provide information at the Annual General Meeting in respect of
- · any circumstances which may affect the assessment of a matter on the agenda and
- · any circumstances which may affect the assessment of the company’s financial position.
AGENDA
1. Call to order and election of Chairperson.
2 Preparation and approval of voting list.
3. Election of two people to check the minutes.
4. Determination of whether the meeting has been duly convened.
5. Approval of the agenda.
6. The Chairman of the Board's report on the work of the Board and Committees since the 2010 Annual General Meeting. The President’s report on the business during 2010 as well as the result for the first quarter of 2011, presentation of the annual report and the auditors’ report, as well as the consolidated accounts and the auditors’ report on the consolidated accounts.
7. Decision on approval of Income Statement and Balance Sheet and the Consolidated Income Statement and the Consolidated Balance Sheet.
8. Resolution about allocation of the Company’s profit.
9. Resolution on record day for issuing dividend.
10. Resolution to discharge the Board and the President from liability.
11. Resolution on the number of Board members.
12. Determination of remuneration to the Board of Directors.
13 Determination of the fee payable to the auditors.
14. Proposals for Directors with information on the proposed candidates’ duties in other companies.
15. Election of Chairman of the Board and other Directors.
16. Motion for resolution on adopting instructions to the Nomination Committee.
17. Motion for resolutions on guidelines for salary and other remuneration to senior executives.
18. Motion for JM Convertibles 2011/2015 and JM Warrants 2011/2015.
19. Motion on amendment of Articles of Association.
Proposals for resolution:
Item 1. The Nomination Committee proposes that Lars Lundquist be appointed to chair the Annual General Meeting.
The Nomination Committee consists of Lars-Åke Bokenberger (Chairperson) representing AMF Pension, KG Lindvall representing Swedbank Robur Funds, Anders Algotsson representing AFA Försäkringar, Thomas Ehlin representing Nordea Fonder and Lars Lundquist, Chairman of the Board of JM AB.
Items 8 and 9. The Board of Directors proposes that a dividend of SEK 4.50 per share be paid to shareholders. The proposed record date for the dividend is Tuesday, May 3, 2011. If the Annual General Meeting resolves to adopt the recommendation the dividend will be sent by Euroclear Sweden AB on Friday, May 6, 2011.
Items 11 – 16. The Nomination Committee proposes the following:
Item 11. Seven Directors elected by the Annual General Meeting.
Item 12.
Directors' remuneration
The Chairman shall be paid SEK 635,000 and Directors who are not employed by the Company will be paid SEK 280,000.
Committee fees
Directors who are not employed by the Company will receive remuneration for work on Committees as follows:
Chairperson of the Audit Committee: SEK 120,000.
Directors on the Audit Committee: SEK 90,000.
Chairperson of the Compensation Committee: SEK 60,000.
Director on the Compensation Committee: SEK 60,000.
Chairperson of the Investment Committee: SEK 60,000.
Directors on the Investment Committee: SEK 60,000.
Proposed fees for the 2011 Annual General Meeting pertaining to six paid Directors amounts to a total of SEK 2,635,000, including remuneration for work on Committees. Thus the proposal entails a raise of approximately 8.2 percent.
Item 13. Remuneration to auditors will be paid as per invoices issued by the auditing company and approved by JM.
Items 14 and 15. Reelection of Lars Lundquist to Chairman of the Board (elected 2005).
Reelection of Directors Elisabet Annell (elected 2002), Anders Narvinger (elected 2009), Kia Orback Pettersson (elected 2010), Johan Skoglund (elected 2003), Åsa Söderström Jerring (elected 2007) and Torbjörn Torell (elected 2004).
Information about all Directors proposed for JM AB’s Board as well as the statement of the Nomination Committee pertaining to the proposal is available on JM AB’s website at www.jm.se under section About JM – Corporate Governance. These documents will be sent to those shareholders who request them and provide their mailing address. They will be available at the Annual General Meeting.
Item 16. Approval of the instructions for the Nomination Committee that were adopted at the 2010 Annual General Meeting.
The instructions to the Nomination Committee are available on JM AB's website www.jm.se under the tab About JM – Corporate Governance. This document will be sent to those shareholders who request them and provide their mailing address. It will be available at the Annual General Meeting.
The duties of the Nomination Committee and how the work was conducted between October 2010 and March 2011 can be seen in the Nomination Committee’s report, which can be found on JM AB’s website www.jm.se, under the tab About JM – Corporate Governance. This document will be sent to those shareholders who request it and provide their mailing address. It will be available at the Annual General Meeting.
Item 17. The Board of Directors proposes that the Annual General Meeting approve the following guidelines for salary and other remuneration to senior executives.
Compensation to the CEO and other senior executives shall consist of fixed salary, short-and long-term variable salary programs, pension benefits and other benefits. “Other senior executives” refers to the Executive Management. Total compensation must be at market rates and competitive in the labor market in which the executive works. Fixed salary and short-term variable salary program will be related to the executive’s responsibilities and authorities. The short-term variable salary program for senior executives will be capped at 50 percent of fixed salary. The short-term variable salary program will be based on performance in relation to established targets, which is usually the externally reported operating profit before tax, earnings per share and Customer Satisfaction Index. Long-term variable salary programs can be share- and/or cash-related and will be performance-based and upon commitment obligations be capped at 50 percent of fixed salary. Termination of employment is normally subject to a mutual period of notice of six months. If notice of termination is given by JM, severance pay equivalent to six months’ salary should also be payable. Pension benefits shall be either defined-benefit or defined-contribution, or a combination thereof, and the normal retirement age is 65. The Compensation Committee will draft and the Board of Directors will approve the remuneration policy for the President and senior executives. The Board shall have the right to depart from the guidelines if extenuating circumstances are present in the individual case.
Item 18. The Board of Directors proposes, that the Annual General Meeting resolve that JM AB raise a debenture loan with a maximum nominal value of SEK 120,000,000 by issuing a maximum of 530,000 convertible debentures, aimed at all employees in Sweden and issue a maximum of 95,000 warrants aimed at all employees outside Sweden.
With respect to convertibles, the issue price will correspond with the par value of the debt commitments and with respect to the warrants, the option premium will correspond with the market value of the warrants at the time of issue.
Each convertible and each warrant, respectively, may be converted to or entitle the holder to subscription of one ordinary share at a conversion price or subscription price equivalent to 125 percent of the latest noted average price paid for ordinary shares in JM on the official exchange list of the NASDAQ OMX Stockholm AB for the period of May 3, 2011 to May 11, 2011.
Conversion or subscription may occur commencing on June 2, 2014 through May 22, 2015, with the exclusion of the period January 1 through the record date for dividends each year, or if the Annual General Meeting should not resolve on a dividend during a year, the third business day after the AGM. In the event of full participation in the offer as well as full conversion and full exercise of the warrants, respectively, JM’s share capital could increase by a maximum of SEK 625,000, through the issue of a maximum of 625,000 ordinary shares, each with a quota value of 1 Swedish krona. This corresponds with dilution of about 0.75 percent of shares and votes in JM.
The term of the convertibles will begin on June 20, 2011, and fall due for payment on June 19, 2015, insofar as conversion has not already been undertaken. The interest rate on the convertible bonds is determined annually, the first time as at June 16, 2011 (for the period June 20, 2011 to June 19, 2012). The interest rate is based in part on the conversion rate and the calculated market value for the convertibles at issuance. Assuming an average share price of SEK 160 during the benchmark period and a conversion price of SEK 200, the interest rate would be STIBOR 360 plus 2.05 percentage points.
Only a wholly owned subsidiary of JM shall be entitled to subscribe to the convertibles and issue of warrants respectively, with waiver of shareholders’ rights of pre-emption. The subsidiary must subscribe and pay for the convertibles and warrants, respectively, during the period commencing on June 16, 2011 through June 20, 2011. The subsidiary shall have the right and obligation during the period commencing on May 23, 2011 until June 7, 2011, to offer those who as of April 29, 2011 are (i) employees in the JM Group in Sweden, on market-based terms, the opportunity to acquire convertible debentures and (ii) to offer employees in the JM Group outside Sweden to acquire warrants.
The Board cited the following reasons for waiving the shareholders’ rights of pre-emption: Since the employees comprise an important component in JM's development the Board of Directors' proposal is to offer those employees a long-term incentive program consisting of convertibles and warrants, respectively, in accordance with what was offered in 2007, 2008, 2009 and 2010. The employee’s ownership commitment enhances and strengthens interest in JM’s operations and future financial performance. It is the Board of Directors’ assessment that increased employee motivation and participation in JM’s operations is in the interest of the Company, the employees and existing stockholders.
Everyone entitled to subscribe for convertibles will be guaranteed a nominal amount of SEK 33,962, though a maximum of 150 convertibles, and everyone entitled to subscribe for the warrants will be guaranteed 150 warrants.
The resolution about the issue by the AGM in accordance with the Board’s proposal requires that the Meeting’s decision is supported by shareholders representing at least nine tenths of the votes cast as well as the shares represented at the Meeting.
The Board of Directors proposes the establishment of equivalent convertible and warrant programs even next year, on condition of approval to that effect at the next AGM.
Item 19. The Board of Directors proposes amendment of section 8 point 1 of the Articles of Association to adapt the Articles of Association to new rules in the Swedish Companies Act.
Current wording: Notification of the Annual General Meeting or extraordinary general meeting in which a matter concerning amendments to the company Articles of Association will be dealt with must be issued at the earliest six weeks and at the latest four weeks before said meeting. Notification to other extraordinary general meetings must be issued at the earliest six weeks and at the latest two weeks before the date of the said meeting.
Proposed wording: Notification of the Annual General Meeting or extraordinary general meeting in which a matter concerning amendments to the company Articles of Association will be dealt with must be issued at the earliest six weeks and at the latest four weeks before said meeting. Notification to other extraordinary general meetings must be issued at the earliest six weeks and at the latest three weeks before the date of the said meeting.
In order for the resolution by the AGM about the amendment to the Articles of Association to go into force it must be supported by shareholders with at least two thirds of both the specified votes and the shares represented at the Meeting.
For further information, please contact
Urban Lilja, general counsel JM, telephone/mobile: +46 (0)8-782 87 05
JM is one of the leading developers of housing and residential areas in the Nordic region. Operations focus on new production of homes in attractive locations, with the main focus on expanding metropolitan areas and university towns in Sweden, Norway, Denmark, Finland and Belgium. We are also involved in project development of commercial premises and contract work, primarily in the Greater Stockholm area. JM shall promote long-term quality and environmental management in all its operations. Our annual sales total approximately SEK 9 billion and the company has about 2,100 employees. JM AB is a public limited company listed on the NASDAQ OMX Stockholm, Mid Cap segment.