Notice of Annual General Meeting of Medivir AB (publ)

        Print
| Source: Medivir AB
The shareholders in Medivir AB are hereby summoned to the annual general meeting
on Thursday 8 May 2014 at 2 p.m. at the conference center 7A Odenplan,
Norrtullsgatan 6, Stockholm, Sweden.

Participation

Shareholders who wish to participate in the meeting must (a) be recorded in the
share register maintained by Euroclear Sweden AB on Friday 2 May 2014, and (b),
notify the company of their intention participate in the meeting not later than
on Friday 2 May 2014 in writing to Medivir AB, Blasieholmsgatan 2, SE-111 48
Stockholm, Sweden. Such notification can also be made by telephone +46 (0)8-407
64 30, by e-mail enter@medivir.se or via the company’s web site at
www.medivir.se. The notification shall set forth the name, address, telephone
number (daytime), personal/corporate identity number, the number of shares held
and, when applicable, information about representatives and assistants.

As per the day of this notice, there are 31,260,027 shares outstanding in the
company, whereof 660,000 series A shares and 30,600,027 series B shares
corresponding to an aggregate of 37,200,027 votes. The company holds no treasury
shares.

Shareholders represented by proxy shall issue a written and dated power of
attorney for the proxy or, should the right to vote for the shares be divided
among different representatives, the representatives, together with information
on the number of shares each representative is entitled to vote for. If the
power of attorney is issued on behalf of a legal entity, a certified copy of a
registration certificate for the legal entity (or corresponding document),
evidencing the authority to issue the proxy, shall be appended. The original of
the power of attorney and, when applicable, the registration certificate should
be sent to the company at the address indicated above, well before the meeting.
A proxy form is available at the company’s website, www.medivir.se, and is sent
to shareholders who so request.

Shareholders whose shares are registered in the name of a nominee through a bank
or a securities institution must re-register their shares in their own names to
be entitled to participate in the meeting. Such registration, which may be
temporary, must be duly effected in the share register maintained by Euroclear
Sweden AB on Friday 2 May 2014, and the shareholders must therefore advise their
nominees well in advance of this date.

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

Proposed agenda

 1. Election of chairman of the meeting (see below).
 2. Preparation and approval of the voting list.
 3. Approval of the agenda.
 4. Election of two persons to approve the minutes of the meeting.
 5. Determination of whether the meeting has been duly convened.
 6. Report from the managing director Maris Hartmanis. Report from the chairman
of the board Göran Pettersson concerning the work of the board, the board´s
committees and of the nomination committee.
 7. Presentation of the annual report and the auditor’s report as well as
consolidated annual accounts and the auditor’s report for the group.
 8. Resolution on approval of the profit and loss account and balance sheet as
well as the consolidated profit and loss account and consolidated balance sheet.
 9. Resolution on approval of allocations of the company’s profits or losses
according to the adopted balance sheet (see below).
10. Resolution on discharge from liability of the members of the board of
directors and the managing director.
11. Determination of the number of directors, deputy directors, auditors and
deputy auditors. (see below).
12. Determination of fees to be paid to the directors and the auditor (see
below).
13. Election of the directors, chairman of the board and auditor (see below).
14. The nomination committee’s proposal concerning nomination committee (see
below).
15. The board’s proposal on guidelines for remuneration to the management (see
below).
16. The board’s proposal concerning resolution on authorisation for the board to
resolve on new issue of shares (see below).
17. The board’s proposal regarding (a) long-term incentive programme and (b)
hedging arrangements in relation thereto (see below).

Allocation of the company’s balance (item 9)

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

Board of directors etc (items 1 and 11–13)

The nomination committee, comprising Anders Algotsson (AFA Försäkring and
chairman of the nomination committee), Bo Öberg (shareholder of series A-shares
and founder), Annelie Enquist (Skandia Fonder) and the chairman of the board of
directors of Medivir Göran Pettersson, proposes the following:

  · Attorney at law Erik Sjöman to be appointed chairman of the meeting (item
1).
  · The board of directors shall consist of seven members with no deputies. The
company shall have one auditor without deputy auditors (item 11).
  · The remuneration to the board of directors shall be paid in a total amount
of not more than SEK 2,530,000 allocated as follows. The chairman shall receive
SEK 500,000 and other members which are not employed by the company shall
receive SEK 230,000 each. Remuneration for work performed in relation to
committees is proposed to be paid in a total amount of not more than
SEK 650,000, whereof SEK 210,000 shall be allocated to the audit committee
(whereof SEK 80,000 to the summoner of the committee and SEK 65,000 to each of
the other two members), SEK 165,000 to the remuneration committee (whereof SEK
65,000 to the summoner of the committee and SEK 50,000 to each of the other two
members) and SEK 275,000 to the R&D committee (whereof SEK 80,000 to the
summoner of the committee and SEK 65,000 to each of the other three members).
For board members resident outside of Europe it is proposed that, in addition to
the ordinary remuneration, compensation of SEK 20,000 shall be paid per physical
board meeting. However, such additional compensation shall never exceed
SEK 100,000 per year (item 12).
  · Remuneration to the auditor shall be paid in accordance with approved
invoices within the auditor’s quotation (item 12).
  · Re-election of members of the board Björn C. Andersson, Anders Hallberg,
Anna Malm Bernsten and Birgitta Stymne Göransson and election of Anders Ekblom,
Niklas Prager and Bertil Samuelsson. Rolf A Classon, Ingemar Kihlström, Göran
Pettersson and Bo Öberg have declined re-election (item 13).
  · Election of Birgitta Stymne Göransson as chairman of the board (item 13).
  · Re-election of the auditing company PricewaterhouseCoopers AB for the period
up to the end of the annual general meeting to be held 2015 (item 13).

Further information on the proposed members of the board is available at
www.medivir.se.

Nomination committee (item 14)

The nomination committee proposes that the annual general meeting shall resolve
to appoint a nomination committee for the annual general meeting 2015 mainly in
accordance with the same procedure as the preceding year.

The chairman of the board shall contact the three largest shareholders in
respect of voting power by the end of the third quarter. These three
shareholders are offered to appoint one representative each for the nomination
committee. In addition, the chairman of the board shall be a member of the
nomination committee. If a shareholder chooses not to exercise the right to
appoint a representative, the right shall pass on to the largest shareholder in
respect of voting power who has not appointed a representative. The nomination
committee is to elect a chairman among its members to lead the work of the
committee.

If any of the shareholders who has appointed a member of the nomination
committee sells a not insignificant part of its shareholding during the
nomination committees’ term or for any other reason ceases to be a larger
shareholder with rights to appoint a member of the nomination committee, the
member appointed by such shareholder should resign from the nomination
committee. This member shall then be replaced by a member appointed by the
shareholder who, based on voting power following the sale, instead is one of the
three largest shareholders in the company. If such shareholder does not utilise
its right to appoint a member of the nomination committee, the above described
procedure shall be applied.

In the event a member no longer represents the shareholder who appointed him or
her, or otherwise resigns from the nomination committee prior to the completion
of the nomination committee’s work, the shareholder shall be given the
opportunity to appoint a new member of the nomination committee.

The nomination committee shall pursue the tasks that, according to the Swedish
Code of Corporate Governance, are the responsibility of the nomination
committee.

Guidelines for remuneration to the management (item 15)

The board proposes remuneration guidelines for senior executives that generally
correspond to the guidelines that have been applied up to now. Under the
guidelines, the company shall offer a total remuneration on market norms and
enable skilled senior executives to be hired and retained. The remuneration to
senior executives may consist of fixed salary, variable salary, incentive
programmes resolved by the general meeting, pension and other benefits. The
fixed salary shall relate to individual responsibilities and experience. The
variable cash remuneration may not exceed 50% of the annual fixed salary. In
order to facilitate the company’s long-term value creation, variable
remunerations shall be based on pre-determined and measurable criteria.

Authorisation to issue new shares (item 16)

The board of directors proposes that the general meeting resolves to authorise
the board, for the period up to the next annual general meeting to adopt
decisions, whether on one or several occasions and whether with or without pre
-emption rights for the shareholders, to issue new shares of series B to an
amount not exceeding in total 10 per cent of the total number of outstanding
series B shares in the company following utilization of the authorisation. New
issue may be made with or without provisions concerning non-cash consideration,
set-off or other provision specified in Chapter 13 Section 5, first paragraph,
6, of the Swedish Companies Act. The purpose of the authorisation is to provide
the board with flexibility in its work to secure that the company, in a suitable
way, can be provided with capital for the financing of the business,
acquisitions of companies and products, and to enable a broadening of the
ownership of the company.

Proposal for long-term incentive programme (item 17)

The board of Medivir AB (publ) (“Medivir”) proposes that the annual general
meeting resolves on a long-term incentive programme for the employees of Medivir
in accordance with items 17 a) and b). All resolutions are proposed to be
conditional on each other and therefore proposed to be adopted as one
resolution. Resolutions in accordance with items a) and b) below are only valid
if supported by shareholders representing at least nine tenths of both the votes
cast and the shares represented at the annual general meeting.

Resolution on long-term incentive programme (item 17 a))

Summary of LTI 2014
The board proposes that the annual general meeting resolves to implement a new
long term incentive programme for the employees of Medivir (“LTI 2014”). To
participate in LTI 2014, it is required that the participants acquire Series B
shares in Medivir at market price (“Investment Shares”). This personal
investment will thereafter be matched by Medivir through allotment free of
charge of so-called matching shares (“Matching Shares”) and so-called
performance shares (“Performance Shares”) under the following conditions and
principles. Each Investment Share entitle the participants to receive a maximum
of one (1) Matching Share and a maximum of three (3) Performance Shares. The
total number of Series B shares in Medivir that may be granted under the
programme, not taking into account the shares that may be issued through the
exercise of warrants to secure the programme, shall be limited to 299,192,
representing approximately 0.9 per cent of the total number of shares and
approximately 0.8 per cent of the total number of votes in Medivir. The total
number of Series B shares in Medivir that may be granted under the programme,
including the shares that may be issued through the exercise of warrants to
secure the programme, amounts to a maximum of 385,359 Series B shares
representing approximately 1.2 per cent of the total number of shares and
approximately 1.0 per cent of the total number of votes in Medivir.

Preparation and motives for the proposal
LTI 2014 has been initiated by the board of Medivir, and has been prepared in
consultation with external advisers based on an evaluation of prior incentive
programmes. LTI 2014 has been prepared by the remuneration committee of the
board and discussed at board meetings. Following an evaluation of the previous
incentive programmes, the board proposes a new long-term incentive programme
which, to a large extent, is equivalent to the incentive programme resolved on
by the annual general meeting 2013 and is addressed to all employees of Medivir.

The purpose of LTI 2014 is to create conditions to retain and recruit competent
personnel to the group and that employees become shareholders in the company to
promote and encourage continued loyalty with the company through aligning the
interests of the shareholders and the employees. In light hereof, the board
believes that the implementation of LTI 2014 will have a positive effect on the
continued development of the group and consequently that LTI 2014 is beneficial
to both the shareholders and the company. The board intends to carry out an
evaluation of LTI 2014 which will be based on the objectives mentioned above in
order to systematically analyse achieved results. The aim of the evaluation will
be to determine whether the programme fulfils its purposes, which also includes
to review the outcome and costs for the programme.

Investment Shares
In order to be able to participate in LTI 2014, it is required that the
employees acquire Series B shares in Medivir at market price, with an amount
corresponding to a minimum of in total SEK 3,000 and a maximum of in total one
-twelfth (1/12) of its annual basic salary before tax, so-called Investment
Shares.

Allocation
For each Investment Share that a participant acquires under LTI 2014, the
participant will be granted one (1) matching share award (“Matching Share
Award”) and three (3) performance share awards (“Performance Share Award”)
(Matching Share Awards and Performance Share Awards, together referred to as
“Share Awards”).

Conditions for all Share Awards
The following conditions shall apply to all Share Awards:

  · The Share Awards shall be granted provided that the participant has made a
private investment in Investment Shares as stated above.
  · Each Share Award entitles the holder to receive one (1) Series B share in
Medivir free of charge, vested as Matching Share or Performance Share in
accordance with the terms below, three (3) years after the start of LTI 2014
(the “Vesting Period”). The last day for the start of LTI 2014 shall be 31
December 2014.
  · The right to receive Series B shares presumes, with certain exceptions, that
the participant is still employed within the Medivir group and has kept the
Investment Shares at the end of the Vesting Period.
  · The Share Awards also include a right to be compensated for the value of
dividends paid to the shareholders during the Vesting Period, through grant of
additional Series B shares.
  · The Share Awards are non-transferable and may not be pledged.
  · The Share Awards can be granted by Medivir or other companies within the
group.

Special conditions for the Performance Share Awards
The number of Performance Share Awards that entitle to Series B shares in
Medivir (Performance Shares) depends on the outcome of three performance
criteria set by the board of directors as follows:
  i)     the share price development for the Medivir Series B share compared to
a benchmark index during the financial years 2014-2016, corresponds to one-third
(1/3) of the granted Performance Share Awards to each employee;
  ii)    the outcome of strategic objectives related to Medivir’s research
portfolio[1] (http://#_ftn1) during the financial years 2014-2016, corresponds
to one-third (1/3) of the granted Performance Share Awards to each employee; and
  iii)   the outcome of strategic objectives related to Medivir’s pharmaceutical
portfolio[1] during the financial years 2014-2016, corresponds to one-third
(1/3) of the granted Performance Share Awards to each employee.

The determined levels of the performance conditions are minimum and maximum
levels with a linear increase for intermediate values regarding the number of
Share Awards that shall entitle to allotment of Series B shares. If the
determined minimum level for the respective performance conditions are
fulfilled, 25 per cent of the Share Awards in the relevant category will entitle
to Series B shares. If the minimum level for a performance condition is not
fulfilled, all Share Awards in the relevant category will be forfeited. If the
maximum level is fulfilled for a performance condition, all Share Awards in the
relevant category will entitle to Series B shares. Separate assessments are made
for the fulfilment of each performance condition.

Preparation and administration
The board shall be responsible for the detailed preparation and administration
of LTI 2014, within the resolved terms and guidelines. In connection therewith,
the board shall be entitled to make adjustments to fulfill certain foreign
regulations or market conditions. The board shall also have the right to make
other adjustments if significant changes in the Medivir group, or its operating
environment, would result in a situation where the resolved terms and conditions
for allotment, the possibility to invest in Investment Shares or the possibility
to receive Matching Shares and Performance Shares under LTI 2014 is no longer
appropriate.

Scope and costs for the programme
The total number of Series B shares which corresponds to the participant’s total
maximum personal investment in Investment Shares, and thus the total number of
Share Awards under LTI 2014, is dependent on the share price for Medivir’s
Series B share at the time of the start of LTI 2014. Provided that the company’s
Series B share at such time is traded at around SEK 114, it is estimated that
LTI 2014 will, in accordance with the above principles and assumptions, comprise
of in total maximum 299,192 Series B shares, which corresponds to approximately
0.9 per cent of the total number of shares and approximately 0.8 per cent of the
total number of votes in Medivir. Including the shares that may be issued
through the exercise of warrants to secure the programme, in accordance with the
below, the total number of Series B shares amounts to a maximum of 385,359
Series B shares representing approximately 1.2 per cent of the total number of
shares and approximately 1.0 per cent of the total number of votes in Medivir.

LTI 2014 will be accounted for in accordance with “IFRS 2 – Share-based
payments”. IFRS 2 stipulates that the Share Awards should 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 according to UFR 7 during the Vesting Period. Payments of social
security charges are secured for cash flow purposes through the exercise of
warrants. The cost for LTI 2014 has been calculated assuming a share price at
the time of implementation of the programme of SEK 114, that all participants
(except for the managing director who will not participate in LTI 2014) acquire
Investment Shares to the maximum level, that the Share Awards entitle to
compensation for dividends and an employee turnover of 5 per cent. For the
calculation of the social security costs, an annual share price increase of 10
per cent has been assumed. In accordance with the above principles and
assumptions, the cost for the LTI 2014 before tax assuming full achievement of
the conditions for the Performance Share Awards, including the social security
cost, is estimated to in total approximately SEK 36.8 million, which on an
annual basis corresponds to approximately 8.6 per cent of Medivir’s total
personnel costs for the financial year 2013.

The effects of LTI 2014 on Medivir’s key ratios had, provided that the programme
was implemented in 2013 with full acceptance and maximum allotment of Matching
Shares and Performance Shares had occurred in 2013 and that the company had
incurred costs in accordance with the example above, resulted in a decrease in
earnings per share for the financial year 2013 by SEK 0.33 to SEK -1.02 and a
decrease in equity per share for the financial year 2013 by SEK 0.47 to SEK
26.81.

Reference is made to the company’s annual report for 2013, note 5, for a
description of Medivir’s other long-term share based incentive programmes.

Hedging arrangements and authorisation to issue warrants (item 17 b))

To secure the completion of LTI 2014, the board proposes that the annual general
meeting authorises the board to, during the period until the next annual general
meeting, on one or several occasions, to resolve to issue, free of charge, in
total a maximum of in total 385,359 warrants to wholly owned subsidiaries within
the Medivir group. Each warrant shall give the right to subscribe for one Series
B share in Medivir at a subscription price corresponding to the share’s quota
value. The warrants and shares issued through the exercise of the warrants shall
be possible to dispose of to fulfill delivery of shares under LTI 2014 and to
secure cash flows for certain payments in connection therewith, including
payments of social security charges incurred by the group in connection with LTI
2014.

Documentation

The annual report and other supporting documentation for resolutions will be
available at the company’s offices, Blasieholmsgatan 2, 111 48 Stockholm, at
latest three weeks prior to the general meeting and will be sent to shareholders
who so request and who have specified their postal address. This notice is a
translation of a Swedish notice and in case of any deviations between the both
language versions, the Swedish version shall prevail.


Stockholm, April 2014
Medivir AB (publ)
The board of directors

----------------------------------------------------------------------

[1] Strategic objectives related to Medivir’s research portfolio primarily
relate to value creating progress in Medivir's research projects and licensing
out of projects. Strategic objectives related to Medivir’s pharmaceutical
portfolio primarily relate to licensing in and out of pharmaceuticals.