The Annual General Meeting held on 10 May 2023 resolved to adopt three long-term incentive plans, Warrant Plan 2023/2026, Warrant Plan 2024/2027, and Warrant Plan 2025/2028 (each a “Warrant Plan” and together the “Warrant Plans”) for senior executives and certain key persons in Mips (in total 25 persons) by the issue of warrants with subsequent transfers to the participants in the incentive plans at a price corresponding to market terms.
The Warrant Plans comprise a maximum of 429,000 warrants corresponding to a maximum dilution of the share capital and votes in the company of approximately 1.6 percent, subject to recalculation according to the terms and conditions for each Warrant Plan. Each warrant entitles to subscription of one new share in Mips at a subscription price corresponding to 130 percent of the average volume-weighted price paid for the Mips share according to Nasdaq Stockholm’s official price list during the five trading days preceding the time when the participants in Mips, who are covered by the Warrant Plans, acquire warrants under each respective Warrant Plan.
The company has no other costs for the Warrant Plans other than administrative costs regarding advisors etc. in connection with the preparation of the documentation and the resolution to issue the warrants etc.
The Annual General Meeting held on 7 May 2020 resolved to adopt a long term incentive plan (“Warrant Plan 2020/2023”) for senior executives and certain key persons in Mips (in total 12 persons) by an issue of warrants with a subsequent transfer to the participants at a price corresponding to market terms.
The warrant plan comprises a maximum of 575,000 warrants corresponding to a dilution of the share capital and votes in the company of approximately 2.2 per cent, subject to recalculation according to the terms and conditions for the warrants. Each warrant entitles to subscription of one new share in Mips at a subscription price corresponding to 130 percent of the average volume-weighted price paid for the Mips share on Nasdaq Stockholm during the period from and including 8 May 2020 up to and including 14 May 2020.
The company has no other costs for Warrant Plan 2020/2023 than administrative costs regarding advisors etc. in connection with the preparation of the documentation and the resolution to issue the warrants etc.
The Annual General Meeting held on 7 May 2020 also resolved to adopt a long-term performance share plan for employees in Mips (“LTIP 2020”), which comprises all employees within the Mips group except for the employees who are offered to participate in the Warrant plan 2020/2023 (in total 42 persons).
Participation in the plan requires a personal investment and the participants may as a maximum invest in a number of shares with a value corresponding to the participant’s monthly salary in April 2020 before taxes, assuming a share price of SEK 211.43. Each investment share entitles to one share right and each share right entitles the holder to receive one share in Mips, subject to the following conditions being fulfilled; (i) that the participant remains employed within the Mips group until, and including, the day on which Mips’ interim report for the first quarter of 2023 is announced, (ii) that the participant has kept all of its investment shares, and (iii) that the performance target is fulfilled.
The performance target is achieved if the annual average total shareholder return (TSR) on Mips’ share amounts to 10 percent or more during the measurement period (March 2020 – March 2023). Allocation of shares shall normally take place within two weeks after the announcement of Mips’ interim report for the first quarter of 2023. As a maximum, 7,000 shares in Mips can be allocated under LTIP 2020, which represents approximately 0.03 percent of all shares and 0.03 percent of all votes in the company.
The Annual General Meeting further resolved to (i) authorize the Board to resolve upon acquisition of own shares to ensure that Mips can deliver shares under LTIP 2020, (ii) to transfer shares which Mips acquires by use of the authorization to acquire own shares to the participants, and (iii) to authorize the Board to resolve upon transfers of acquired shares on Nasdaq Stockholm.
Based on the assumption of a share price of SEK 212.50 at the time of investment (the closing price on 27 March 2020), an annual average increase of the share price of 10 percent, participation in the plan by all persons invited to participate, that all participants make the maximum investment and that all participants remain in the plan up until the allocation and the payment, respectively, the total estimated cost of LTIP 2020 is approximately MSEK 1.5, including estimated social security contributions. The cost is equivalent to the value of approximately 0.03 percent of Mips’ market capitalization based on the closing price for Mips on 27 March 2020.
For the persons who Mips’ subsidiary in China employs, certain special conditions apply meaning that such employees will receive synthetic shares, free of charge, instead of share rights, and that no personal investment is required in order for these employees to participate in LTIP 2020.