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Notice of Annual General Meeting in Pomegranate Investment AB

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NOT FOR DISTRIBUTION IN THE UNITED STATES OR TO ANY U.S. PERSON

The shareholders in

Pomegranate Investment AB (publ)

with Reg. No. 556967-7247 and registered office in Stockholm are hereby convened to the annual general meeting to be held on 13 September 2023 at 3 p.m. at the offices of Advokatfirman Vinge, Smålandsgatan 20, SE-111 46 Stockholm.

Notification, etc.

Shareholders who wish to participate in the general meeting must:

firstly       be included in the shareholders’ register maintained by Euroclear Sweden AB as of 5 September 2023; and

secondly   notify the company of their participation in the general meeting no later than
7 September 2023. The notification shall be in writing via email to legal@pomegranateinvestment.com or in writing to the company’s address Pomegranate Investment AB (publ), Mäster Samuelsgatan 1, 1st floor, SE-111 44 Stockholm, Sweden. The notification shall state the name, personal/corporate identity number, shareholding, address and daytime telephone number, and, where applicable, information about representatives, counsel or assistants. Where a shareholder is represented by proxy, the notification must be accompanied by complete authorization documents, such as powers of attorney, registration certificates and/or corresponding documents.

Nominee registered shares

To be entitled to participate in the annual general meeting a shareholder whose shares are registered in the name of a nominee must register its shares in its own name so that the shareholder is recorded in the share register on Tuesday, 5 September 2023. Such registration may be temporary (so-called voting right registration) and is requested from the nominee in accordance with the nominee’s procedures and such time in advance as the nominee determines. Voting right registrations completed not later than Thursday, 7 September 2023 are taken into account when preparing the share register.

Proxy, etc.

If the shareholder votes in advance by proxy, a dated and signed power of attorney for the proxy shall be issued and enclosed to the form for advance voting. If the power of attorney is issued on behalf of a legal entity, a certified copy of a registration certificate or a corresponding document for the legal entity shall be appended. The power of attorney is valid for a maximum of one year after the issuance or for the duration indicated in the power of attorney, whichever is longer, but not for more than five years after issuance. The registration certificate, where applicable, may not be older than one year. The power of attorney in original and, where applicable, the registration certificate, should be submitted to the company by post at the address set forth above well in advance of the meeting. A proxy form is available at the company’s website, www.pomegranateinvestment.com, and will be sent to shareholders who so requests and informs the company of their postal address.

Proposed agenda

  1. Opening of the meeting
  2. Election of chairman of the meeting;
  3. Preparation and approval of the voting list;
  4. Approval of the agenda;
  5. Election of one or two persons to approve the minutes;
  6. Determination of whether the meeting has been duly convened;
  7. Presentation of the company’s annual report and the auditor’s report as well as the group consolidated annual accounts and group auditor’s report;
  8. Resolutions regarding:
  1. adoption of the income statement and the balance sheet and the consolidated income statement and the consolidated balance sheet;
  2. allocation of the company’s result in accordance with the adopted balance sheet;
  3. discharge from liability of the members of the board of directors, the CEO and the deputy CEO;

(i) Nadja Borisova, member of the board of directors

(ii) Per Brilioth, chairman of the board of directors

(iii) Anders F. Börjesson, member of the board of directors

(iv) Mohsen Enayatollah, member of the board of directors

(v) Vladimir Glushkov, member of the board of directors

(vi) Florian Hellmich, CEO

(vii) Gustav Wetterling, former deputy CEO

(viii) Peter Axelsson, deputy CEO

  1. Determination of:
  1. the number of members and alternate members of the board of directors;
  2. the number of auditors and alternate auditors;
  1. Determination of:
  1. fees for the members of the board of directors;
  2. fees for the auditors;
  1. Election of:
  1. the members of the board of directors;

(i) Nadja Borisova (re-election)

(ii) Anders F. Börjesson (re-election)

(iii) Vladimir Glushkov (re-election)

(iv) Michel Danechi (new election)

  1. chairman of the board;

(i) Per Brilioth (re-election)

  1. auditors and, where applicable, alternate auditors;

(i) PricewaterhouseCoopers AB

  1. Resolution to introduce a long-term performance-based incentive program for employees;
    1. Proposal for resolution on adoption of a long-term performance-based incentive program for employees;
    2. Proposal regarding issue of warrants;
    3. Equity swap agreement with a third party;
  2. Resolution to introduce a long-term performance-based incentive program for the board of directors;
    1. Proposal for resolution on adoption of a long-term performance-based incentive program for the board of directors;
    2. Proposal regarding issue of warrants;
    3. Equity swap agreement with a third party;
  3. Amendment of the company’s articles of association;
  4. Closing of the meeting.

Election of chairman of the meeting (item 2)

The board of directors proposes that Jesper Schönbeck, member of the Swedish Bar Association, at Vinge law firm, or the person proposed by the board of directors in case of his impediment, is elected to be the chairman of the meeting.

Resolution regarding allocation of the company’s result in accordance with the adopted balance sheet (item 8b)

The board of directors proposes that the company’s results shall be carried forward.

Determination of the number of members and alternate members of the board of directors and auditors and alternate auditors (item 9)

Shareholders representing 17.9% of the outstanding shares in the company propose that the number of members of the board of directors shall be five (5) with no alternate members.

It is further proposed that the company shall have one auditor or one registered audit company and no alternate auditors.

Determination of fees for members of the board of directors and auditors (item 10)

Shareholders representing 17.9% of the outstanding shares in the company propose that the annual remuneration to each member of the board of directors shall amount to EUR 5,000 and EUR 10,000 to the chairman of the board of directors.

It is further proposed that the company’s auditor shall be remunerated upon approval of their invoice.

Election of the members of the board of directors, chairman of the board of directors and auditors and, where applicable, alternate auditors (item 11)

Shareholders representing 17.9% of the outstanding shares in the company propose that, for the time until the end of the next annual general meeting, Nadja Borisova, Per Brilioth, Anders F. Börjesson and Vladimir Glushkov are re-elected and Michel Danechi is newly elected as members of the board of directors and that Per Brilioth is re-elected as chairman of the board of directors.

For information about the current members of the board of directors proposed for re-election, please see the company’s website, www.pomegranateinvestment.com. Below is a brief presentation of the proposed new election.

Michel Danechi

Education: B.Sc. in Economics from the LSE and a MBA from London Business School.

Experiences: 35 years of experience in equity derivatives and Emerging Markets. Previously ran multi-asset EM funds at DUET Asset Management and Armajaro Asset Management. Before that Head of Trading in EM at Lehman Brothers and UniCredit.

It is further proposed that the company’s auditor, the registered audit company PricewaterhouseCoopers AB, is re-elected for the period until the end of the next annual general meeting.

Resolution to introduce a long-term performance-based incentive program for employees (item 12)

The current Management LTIP 2020 is about to expire. The board of directors proposes that the annual general meeting resolves to implement a new long-term performance-based incentive program similar to Management LTIP 2020 for all of the employees of Pomegranate Investment AB (publ) (“Pomegranate Investment”) (“Management LTIP 2023”) in accordance with items 12a – 12b below. The resolutions under items 12a – 12b below are proposed to be conditional upon each other. Should the majority requirement for item 12b below not be met, the board of directors proposes that Pomegranate Investment shall be able to enter into an equity swap agreement with a third party in accordance with item 12c below and resolutions under items 12a and 12c shall then be conditional upon each other.

Management LTIP 2023 is a program under which the participants will be granted, free of charge, share awards subject to performance vesting (“Share Awards”) that entitle to shares in Pomegranate Investment to be calculated in accordance with the principles stipulated below, however not more than 244,358 shares. As part of the implementation of Management LTIP 2023, not more than 244,358 warrants can be issued in accordance with item 12b below.

Proposal for resolution on adoption of a long-term performance-based incentive program for employees (item 12a)

The rationale for the proposal

Management LTIP 2023, which to a high degree overlaps LTIP 2020, is intended for all of the employees in Pomegranate Investment. The board of directors believes that an equity-based incentive program is a central part of an attractive and competitive remuneration package in order to attract, retain and motivate internationally competent employees, and to focus the participants on delivering exceptional performance which contributes to value creation for all shareholders. Management LTIP 2023 is adapted to the current position and needs of Pomegranate Investment. The board of directors is of the opinion that Management LTIP 2023 will increase and strengthen the participants’ dedication to Pomegranate Investment’s operations, improve company loyalty and be beneficial to both the shareholders and Pomegranate Investment.

Conditions for Share Awards

The following conditions shall apply for the Share Awards.

  1. The Share Awards shall be granted free of charge to the participants as soon as practicable after the annual general meeting.
  1. 1/3 of the Share Awards shall vest gradually over approximately four years, corresponding to four terms up to the date of, whichever is earliest, (i) the annual general meeting 2027 or (ii) 30 September 2027 (the “Vesting Date”), where the initial term equals the period from the annual general meeting 2023 up until the day falling immediately prior to the following annual general meeting 2024 and the remaining terms each equal the period from one annual general meeting (annual general meeting 2024, annual general meeting 2025 and annual general meeting 2026, respectively) up until the day falling immediately prior to the next annual general meeting or the Vesting Date, as applicable (each such period a “Term”). These Share Awards (1/3 of the total number of Share Awards) shall vest with 1/4 at the end of each Term if the participant is still employed by Pomegranate Investment on the said date.
  1. 1/3 of the Share Awards are subject to performance vesting based on the development of the Pomegranate Investment group’s net asset value (NAV) per year. The development of the net asset value (NAV) will be measured based on the annual reports of the group for the financial years ending 30 April 2023 and 30 April 2027. These Share Awards (1/3 of the total number of Share Awards) (the “NAV-based Share Awards”) shall vest accordingly:
    1. One third of NAV-based Share Awards shall vest at the end of the Vesting Date if Pomegranate Investment group’s net asset value (NAV) has increased with more than 10% per year on average between 30 April 2023 and 30 April 2027;
    2.  Two thirds of NAV-based Share Awards shall vest at the end of the Vesting Date if Pomegranate Investment group’s net asset value (NAV) has increased with more than 15% per year on average between 30 April 2023 and 30 April 2027;
    3. All of NAV-based Share Awards shall vest at the end of the Vesting Date if Pomegranate Investment group’s net asset value (NAV) has increased with more than 25 percent per year on average between 30 April 2023 and 30 April 2027.
  1. 1/3 of the Share Awards are subject to gradual performance vesting based on the Pomegranate Investment groups’ cash flow. The cash flow will be measured based on the annual reports of the group for the financial years ending 30 April 2024, 2025, 2026 and 2027. These Share Awards (1/3 of the total number Share Awards) shall vest with 1/4 at the end of each Term if Pomegranate Investment group’s annual cash flow, excluding exits and/or investments in portfolio companies, is equal to or greater than zero during the financial year preceding the end of each respective Term. Should the annual cash flow be negative (i.e. less than zero), vesting in accordance with this item 4 will not occur.
  1. The earliest point in time at which vested Share Awards may be exercised shall be the day falling immediately after the Vesting Date.
  1. Each vested Share Award entitles the holder to receive one share in Pomegranate Investment without any compensation being payable provided that the holder is still employed by Pomegranate Investment at the relevant time of vesting with the exception of certain customary “good leaver”-situations (including death and permanent incapacity to complete the assignment due to illness or accident) and this shall also apply during the first year up until the day of the annual general meeting 2024.
  1. The number of Share Awards will be re-calculated in the event that changes occur in Pomegranate Investment’s equity capital structure, such as a bonus issue, merger, rights issue, share split or reverse share split, reduction of the share capital or similar measures.
  1. The Share Awards cannot be transferred and may not be pledged without the company’s approval.
  1. The Share Awards can be granted by the parent company as well as any other company within the Pomegranate Investment group.
  1. In the event of a public take-over offer, asset sale, liquidation, merger or any other such transaction affecting Pomegranate Investment, the Share Awards will vest in their entirety upon completion of such transaction.
  1. The Share Awards shall otherwise be subject to the terms set forth in the separate agreements with the participants and the detailed terms for Management LTIP 2023.

Allocation

The Share Awards under Management LTIP 2023 shall be awarded in accordance with the following:

  • 114,992 Share Awards to the CEO, Florian Hellmich;
  • 57,496 Share Awards to the CFO Peter Axelsson; and
  • 71,870 additional Share Awards to be allocated by the Board of Directors, including to any future employees in the company.

In any event, Management LTIP 2023 will comprise a total number of Share Awards which, if all Share Awards are vested in accordance with the vesting conditions above, can entitle to not more than 244,358 shares in Pomegranate Investment.

In the event a person in the company’s management is no longer employed in the company, the board shall be permitted to allocate such Share Awards among the remaining members of management or to other employees within the company.

Preparation of the proposal

Management LTIP 2023 has been prepared by the board of directors and has been structured based on an evaluation of prior incentive programs and market practice.

Dilution

Management LTIP 2023 will comprise not more than 244,358 shares, which corresponds to a dilution of approximately 3.7 percent on a fully diluted basis. Taking into account also the shares which may be issued as part of the proposed Board LTIP 2023, the total dilution corresponds to approximately 5.1 percent on a fully diluted basis. Taking into account also the shares which may be issued pursuant to previously implemented incentive programs in the company, the maximum dilution amounts to 7.5 percent on a fully diluted basis. The dilution is only expected to have a marginal effect on the company’s key performance indicator “Earnings per share (in EUR)”.

Information about Pomegranate Investment’s existing incentive programs can be found in Pomegranate Investment’s annual report for the financial year ending 30 April 2023, note 8, which will be available on the company’s website on 23 August 2023, www.pomegranateinvestment.com .

Scope and costs of the program

Management LTIP 2023 will be accounted for in accordance with “IFRS 2 – Share‐based payments”. IFRS 2 stipulates that the Share Awards shall be expensed as personnel costs over the vesting period and will be accounted for directly against equity. Personnel costs in accordance with IFRS 2 do not affect the company’s cash flow. Social security costs will be expensed in the income statement during the vesting period.

Assuming a share price of EUR 8.0 at the time of allotment of Share Awards, an annual NAV and share price increase of 25 percent, the maximum average annual cost for Management LTIP 2023 is, according to IFRS 2, estimated to approximately EUR 489 thousand pre-tax. The estimated IFRS 2 cost has been calculated based on full vesting of the Share Awards (fulfillment of item 2, 3 and 4 under section “Conditions for Share Awards” above) and the other aforementioned basic assumptions regarding share price and share price development. The annual cost for social security contributions is estimated at EUR 157 thousand, based on full vesting of the Share Awards, the aforementioned assumptions and a social security tax rate of 31.42 percent, if applicable. The maximum average annual cost for Management LTIP 2023 during the term of the program, including costs according to IFRS 2 and social security charges, is therefore estimated to approximately EUR 646 thousand.

The maximum total cost of the Management LTIP 2023, including all costs referred to above and social security charges, is estimated to amount to approximately EUR 2,585 thousand under the above assumptions.

Delivery of shares under Management LTIP 2023

In order to ensure the delivery of shares under Management LTIP 2023, the board of directors propose that the annual general meeting resolves to issue warrants in accordance with item 12b below.

Proposal regarding issue of warrants (item 12b)

In order to ensure the delivery of shares under Management LTIP 2023, the board of directors proposes that the annual general meeting resolves to issue not more than 244,358 warrants of series 2023/2027, whereby the company’s share capital can increase by not more than EUR 2443.58, in accordance with the following:

  1. The right to subscribe for the warrants shall, with deviation from the shareholders’ pre-emptive rights, only vest with Pomegranate Investment AB (publ). The reason for the deviation from the shareholders’ pre-emptive rights is the implementation of Management LTIP 2023. Pomegranate Investment AB (publ) shall be entitled to transfer the warrants to participants of Management LTIP 2023, or a financial intermediary in connection with the exercise of Share Awards.
  1. The warrants shall be issued free of charge and shall be subscribed for on a subscription list no later than 30 September 2023. The board of directors may extend the subscription period.
  1. The detailed terms of the warrants are set out in the complete proposal which is kept available to the shareholders in accordance with the below.
  1. The exercise price for subscription for shares based on the warrants shall correspond to the share’s quota value. Any share premium shall be transferred to the unrestricted premium reserve.
  1. The CEO shall be authorized to make such minor adjustments that may be necessary in connection with the registration of the new issue.
  1. Notification of subscription of shares by the exercise of warrants can be made from and including the day of registration of the warrants with the Swedish Companies’ Office up until and including 30 September 2027.
  1. Shares which are issued following subscription shall entitle to participation in the distribution of profits for the first time on the nearest record date occurring after the subscription has been exercised.

Equity swap agreement with a third party (item 12c)

Should the majority requirement for item 12b above not be met, the board of directors proposes that the annual general meeting resolves that Management LTIP 2023 shall instead be hedged so that Pomegranate Investment can enter into an equity swap agreement with a third party on terms in accordance with market practice, whereby the third party in its own name shall be entitled to acquire and transfer shares of Pomegranate Investment to the participants.

Majority requirements

Resolution in accordance with item 12b above requires approval of at least nine tenths (9/10) of the shares represented and votes cast at the annual general meeting.

Resolution to introduce a long-term performance-based incentive program for the board of directors (item 13)

The current Board LTIP 2020 is about to expire. Shareholders representing 17.9% of the outstanding shares in the company propose that the annual general meeting resolves to implement a new long-term performance-based incentive program similar to Board LTIP 2020 for members of the board of directors of Pomegranate Investment AB (publ) (“Pomegranate Investment”) (“Board LTIP 2023”) in accordance with items 13a – 13b below. The resolutions under items 13a – 13b below are proposed to be conditional upon each other. Should the majority requirement for item 13b below not be met, shareholders propose that Pomegranate Investment shall be able to enter into an equity swap agreement with a third party in accordance with item 13c below and resolutions under items 13a and 13c shall then be conditional upon each other.

Board LTIP 2023 is a program under which the participants will be granted, free of charge, share awards subject to performance vesting (“Share Awards”) that entitle to shares in Pomegranate Investment to be calculated in accordance with the principles stipulated below, however not more than 100,617 shares. As part of the implementation of Board LTIP 2023, not more than 100,617 warrants can be issued in accordance with item 13b below.

Proposal for resolution on adoption of a long-term performance-based incentive program for the board of directors (item 13a)

The rationale for the proposal

Board LTIP 2023, which to a high degree overlaps LTIP 2020, is intended for members of the board of directors in Pomegranate Investment. The shareholders believe that an equity-based incentive program is a central part of an attractive and competitive remuneration package in order to attract, retain and motivate internationally competent members of the board of directors, and to focus the participants on delivering exceptional performance which contributes to value creation for all shareholders. Board LTIP 2023 is adapted to the current position and needs of Pomegranate Investment. The shareholders are of the opinion that Board LTIP 2023 will increase and strengthen the participants’ dedication to Pomegranate Investment’s operations, improve company loyalty and be beneficial to both the shareholders and Pomegranate Investment.

Conditions for Share Awards

The following conditions shall apply for the Share Awards.

  1. The Share Awards shall be granted free of charge to the participants as soon as practicable after the annual general meeting.
  1. 1/3 of the Share Awards shall vest gradually over approximately four years, corresponding to four terms up to the date of, whichever is earliest, (i) the annual general meeting 2027 or (ii) 30 September 2027 (the “Vesting Date”), where the initial term equals the period from the annual general meeting 2023 up until the day falling immediately prior to the following annual general meeting 2024 and the remaining terms each equal the period from one annual general meeting (annual general meeting 2024, annual general meeting 2025 and annual general meeting 2026, respectively) up until the day falling immediately prior to the next annual general meeting or the Vesting Date, as applicable (each such period a “Term”). These Share Awards (1/3 of the total number of Share Awards) shall vest with 1/4 at the end of each Term if the participant is still a member of the board of directors in Pomegranate Investment on the said date.
  1. 1/3 of the Share Awards are subject to performance vesting based on the development of the Pomegranate Investment group’s net asset value (NAV) per year. The development of the net asset value (NAV) will be measured based on the annual reports of the group for the financial years ending 30 April 2023 and 30 April 2027. These Share Awards (1/3 of the total number of Share Awards) (the “NAV-based Share Awards”) shall vest accordingly:
    1. One third of NAV-based Share Awards shall vest at the end of the Vesting Date if Pomegranate Investment group’s net asset value (NAV) has increased with more than 10% per year on average between 30 April 2023 and 30 April 2027;
    2. Two thirds of NAV-based Share Awards shall vest at the end of the Vesting Date if Pomegranate Investment group’s net asset value (NAV) has increased with more than 15% per year on average between 30 April 2023 and 30 April 2027;
    3. All NAV-based Share Awards shall vest at the end of the Vesting Date if Pomegranate Investment group’s net asset value (NAV) has increased with more than 25 percent per year on average between 30 April 2023 and 30 April 2027.
  1. 1/3 of the Share Awards are subject to gradual performance vesting based on the Pomegranate Investment groups’ cash flow. The cash flow will be measured based on the annual reports of the group for the financial years ending 30 April 2024, 2025, 2026 and 2027. These Share Awards (1/3 of the total number of Share Awards) shall vest with 1/4 at the end of each Term if Pomegranate Investment annual group’s cash flow, excluding exits and/or investments in portfolio companies, is equal to or greater than zero during the financial year preceding the end of each respective Term. Should the annual cash flow be negative (i.e. less than zero), vesting in accordance with this item 4 will not occur.
  1. The earliest point in time at which vested Share Awards may be exercised shall be the day falling immediately after the Vesting Date.
  1. Each vested Share Award entitles the holder to receive one share in Pomegranate Investment without any compensation being payable provided that the holder is still engaged as a board member of Pomegranate Investment at the relevant time of vesting with the exception of certain customary “good leaver”-situations (including death and permanent incapacity to complete the assignment due to illness or accident) and this shall also apply during the first year up until the day of the annual general meeting 2024.
  1. The number of Share Awards will be re-calculated in the event that changes occur in Pomegranate Investment’s equity capital structure, such as a bonus issue, merger, rights issue, share split or reverse share split, reduction of the share capital or similar measures.
  1. The Share Awards cannot be transferred and may not be pledged without the company’s approval.
  1. The Share Awards can be granted by the parent company as well as any other company within the Pomegranate Investment group.
  1. In the event of a public take-over offer, asset sale, liquidation, merger or any other such transaction affecting Pomegranate Investment, the Share Awards will vest in their entirety upon completion of such transaction.
  1. The Share Awards shall otherwise be subject to the terms set forth in the separate agreements with the participants and the detailed terms for Board LTIP 2023.

Allocation

The Share Awards under Board LTIP 2023 shall be awarded in accordance with the following:

  • 20,123 to each of the members of the board of directors Nadja Borisova, Anders F. Börjesson, Michel Danechi, and Vladimir Glushkov and 23,125 to the chairman of the board of directors Per Brilioth.

In any event, Board LTIP 2023 will comprise a total number of Share Awards which, if all Share Awards are vested in accordance with the vesting conditions above, can entitle to not more than 100,617 shares in Pomegranate Investment.

In the event a board member leaves the board of directors, the company shall be permitted to allocate such Share Awards among the remaining or new members of the board of directors.

Preparation of the proposal

Board LTIP 2023 has been prepared by shareholders representing 17.9% of the outstanding shares in the company and has been structured based on an evaluation of prior incentive programs and market practice.

Dilution

Board LTIP 2023 will comprise not more than 100,617 shares in total, which corresponds to a dilution of approximately 1.6 percent on a fully diluted basis. Taking into account also the shares which may be issued as part of the proposed Management LTIP 2023, the total dilution corresponds to approximately 5.1 percent on a fully diluted basis. Taking into account also the shares which may be issued pursuant to previously implemented incentive programs in the company, the maximum dilution amounts to 7.5 percent on a fully diluted basis. The dilution is only expected to have a marginal effect on the company’s key performance indicator “Earnings per share (in EUR)”.

Information about Pomegranate Investment’s existing incentive programs can be found in Pomegranate Investment’s annual report for the financial year ending 30 April 2023, note 8, which will be available on the company’s website on 23 August 2023, www.pomegranateinvestment.com .

Scope and costs of the program

Board LTIP 2023 will be accounted for in accordance with “IFRS 2 – Share‐based payments”. IFRS 2 stipulates that the Share Awards shall be expensed as personnel costs over the vesting period and will be accounted for directly against equity. Personnel costs in accordance with IFRS 2 do not affect the company’s cash flow. Social security costs will be expensed in the income statement during the vesting period.

Assuming a share price of EUR 8.0 at the time of allotment of Share Awards, an annual NAV and share price increase of 25 percent, the maximum average annual cost for Board LTIP 2023 is, according to IFRS 2, estimated to approximately EUR 201 thousand pre-tax. The estimated IFRS 2 cost has been calculated based on full vesting of the Share Awards (fulfillment of item 2, 3 and 4 under section “Conditions for Share Awards” above) and the other aforementioned basic assumptions regarding share price and share price development. The annual cost for social security contributions is estimated at EUR 107 thousand, based on full vesting of the Share Awards, the aforementioned assumptions and a social security tax rate of 31.42 percent, if applicable. The maximum average annual cost for Board LTIP 2023 during the term of the program, including costs according to IFRS 2 and social security charges, is therefore estimated to approximately EUR 309 thousand.

The maximum total cost of the Board LTIP 2023, including all costs referred to above and social security charges, is estimated to amount to approximately EUR 1,234 thousand under the above assumptions.

Delivery of shares under Board LTIP 2023

In order to ensure the delivery of shares under Board LTIP 2023, shareholders representing 17.9% of the outstanding shares in the company propose that the annual general meeting resolves to issue warrants in accordance with item 13b below.

Proposal regarding issue of warrants (item 13b)

In order to ensure the delivery of shares under Board LTIP 2023, shareholders representing 17.9% of the outstanding shares in the company propose that the annual general meeting resolves to issue not more than 100,617 warrants of series 2023/2027, whereby the company’s share capital can increase by not more than EUR 1,006.17, in accordance with the following:

  1. The right to subscribe for the warrants shall, with deviation from the shareholders’ pre-emptive rights, only vest with Pomegranate Investment AB (publ). The reason for the deviation from the shareholders’ pre-emptive rights is the implementation of Board LTIP 2023. Pomegranate Investment AB (publ) shall be entitled to transfer the warrants to participants of Board LTIP 2023, or a financial intermediary in connection with the exercise of Share Awards.
  1. The warrants shall be issued free of charge and shall be subscribed for on a subscription list no later than 30 September 2023. The board of directors may extend the subscription period.
  1. The detailed terms of the warrants are set out in the complete proposal which is kept available to the shareholders in accordance with the below.
  1. The exercise price for subscription for shares based on the warrants shall correspond to the share’s quota value. Any share premium shall be transferred to the unrestricted premium reserve.
  1. The CEO shall be authorized to make such minor adjustments that may be necessary in connection with the registration of the new issue.
  1. Notification of subscription of shares by the exercise of warrants can be made from and including the day of registration of the Warrants with the Swedish Companies’ Office up until and including 30 September 2027.
  1. Shares which are issued following subscription shall entitle to participation in the distribution of profits for the first time on the nearest record date occurring after the subscription has been exercised.

Equity swap agreement with a third party (item 13c)

Should the majority requirement for item 13b above not be met, shareholders representing 17.9% of the outstanding shares in the company propose that the annual general meeting resolves that Board LTIP 2023 shall instead be hedged so that Pomegranate Investment can enter into an equity swap agreement with a third party on terms in accordance with market practice, whereby the third party in its own name shall be entitled to acquire and transfer shares of Pomegranate Investment to the participants.

Majority requirements

Resolution in accordance with item 13b above requires approval of at least nine tenths (9/10) of the shares represented and votes cast at the annual general meeting.

Amendment of the company’s articles of association (item 14)

Shareholders representing 17.9% of the outstanding shares in the company propose that the annual general meeting resolves to amend the articles of association. A new § 11 in the articles of association is proposed allowing the board of directors to collect powers of attorney in accordance with Chapter 7 Section 4, second paragraph of the Swedish Companies Act (2005:551) and to resolve that the shareholders shall have the right to vote in advance by postal voting. A new 12 § is also proposed, allowing the board of directors to resolve that persons who are not shareholders may participate at a general meeting.

Proposed new § 11 Collecting of powers of attorneys and vote by post

The board of directors may collect powers of attorney in accordance with the procedures described in Chapter 7, Section 4, second paragraph of the Swedish Companies Act.

The board of directors may decide, prior to a general meeting, that the shareholders be permitted to exercise their voting rights by post prior to the general meeting.

Proposed new § 12 Non-shareholders right to attend a general meeting

The board of directors may resolve that persons not being shareholders of the company shall be entitled, on the conditions stipulated by the board of directors, to attend or in any other manner follow the discussions at a general meeting.

The numbering of § 11 is amended to § 13.

Majority requirements

Resolution in accordance with item 14 above requires approval of at least two thirds (2/3) of the shares represented and votes cast at the annual general meeting.

Miscellaneous

A resolution in accordance with item 12b and 13b shall only be valid where supported by not less than nine-tenths (9/10) of both the votes cast and the shares represented at the meeting. Resolution in accordance with item 14 shall only be valid where supported by not less than two thirds (2/3) of both the votes cast and the shares represented at the meeting.

For information on how your personal data is processed, see the integrity policy that is available at Euroclear’s webpage www.euroclear.com/dam/ESw/Legal/Privacy-notice-bolagsstammor-engelska.pdf .

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The annual report and the auditor’s report as well as other documents will be held available at the company’s office, Mäster Samuelsgatan 1, 1st floor, SE-111 44 Stockholm, Sweden and on the company’s website, www.pomegranateinvestment.com, no later than three weeks before the annual general meeting. Copies of the documents will be sent to shareholders who so request and who inform the company of their postal address.

The shareholders are reminded of their right to request information in accordance with Chapter 7 Section 32 of the Swedish Companies Act (Sw. aktiebolagslagen).

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Stockholm, August 2023

Pomegranate Investment AB (publ)

The board of directors

This communication may not be distributed in the United States or to any “U.S. person”, including any U.S. citizen or permanent resident (‘green card holder’) or any entity organised in the United States, whether located inside or outside the United States. Pomegranateshares represent an investment in Iran that is not suitable for U.S. persons.

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