NOTICE TO ANNUAL GENERAL MEETING OF YUBICO AB
English translation for information purposes only. In case of differences between the English translation and the Swedish original, the Swedish version shall prevail.
The Annual General Meeting of Yubico AB will be held on Tuesday May 13, 2025, at 11:00 CEST at Blique by Nobis, Gävlegatan 18 in Stockholm, Sweden. Registration begins at 10:30 CEST.
The board of directors has resolved that shareholders may also exercise their voting right at the Annual General Meeting by postal voting pursuant to the provisions in the articles of association of Yubico.
RIGHT TO ATTEND AND NOTICE
Shareholders wishing to attend the Annual General Meeting
shall be entered as shareholder in the share register kept by Euroclear Sweden AB on Monday May 5, 2025, and
shall give notice of attendance to the company no later than Wednesday May 7, 2025. Notice of attendance in person or through a representative may be given by post to Computershare AB, "Yubico AGM 2025", P.O. Box 5267, SE-102 46 Stockholm, Sweden, by e-mail to proxy@computershare.se, by phone, +46 (0) 771 24 64 00, weekdays during 9:00am – 4:00pm CEST, or at the company's website, https://investors.yubico.com/en/. When giving notice, shareholders are kindly requested to provide their name or company name, personal or corporate identity number, address and telephone number, the number of shares they hold, and, if applicable, number of assistants (maximum two).
Shareholders who wish to use the possibility of postal voting shall do that in accordance with the instructions under the heading "Postal voting" below. Such postal voting does not require any further notice of attendance.
NOMINEE-REGISTERED SHARES
To be entitled to attend the Annual General Meeting, shareholders whose shares are nominee-registered must, in addition to giving notice of attendance to the company, register such shares in their own names so that the shareholder is recorded in the share register kept by Euroclear Sweden AB as of May 5, 2025. Such registration may be temporary (so called voting right registration) and request for such registration shall be made to the nominee in accordance with the nominee's routines in such time in advance as decided by the nominee. Voting rights registrations effected no later than May 7, 2025, will be considered in the preparation of the share register.
PROXY ETC.
Shareholders who wish to attend the Annual General Meeting venue in person or through a proxy representative are entitled to bring one or two assistants. Shareholders who wish to bring assistants shall state this in connection with the notice of attendance. Shareholders represented by a proxy shall issue a signed and dated power of attorney for the proxy. If the power of attorney is issued by a legal entity, a copy of a certificate of incorporation, or if such document doesn't exist, a corresponding authorization document shall be enclosed. In order to facilitate the registration at the Annual General Meeting, the power of attorney and certificate of incorporation and other authorization documents should be received by the company at the address stated above no later than May 7, 2025. A proxy form is available on the company's website, https://investors.yubico.com/en/.
Please note that notification of participation at the Annual General Meeting must be made even if a shareholder wishes to exercise his or her voting rights at the Annual General Meeting through a representative. A submitted power of attorney is not considered as notification to the Annual General Meeting.
POSTAL VOTING
A designated form shall be used for postal voting. The form is available on Yubico's website, https://investors.yubico.com/en/. The postal voting form is considered as a notification of attendance at the Annual General Meeting. The completed and signed postal voting form may be sent by post to Computershare AB, "Yubico AGM 2025", P.O. Box 5267, SE-102 46 Stockholm, Sweden or by e-mail to proxy@computershare.se. Completed forms must be received by Computershare no later than May 7, 2025. Shareholders who are physical persons may also cast postal votes electronically with BankID verification via a link on the company's website, https://investors.yubico.com/en/. Electronic votes must be cast no later than May 7, 2025. If a shareholder votes in advance by proxy, a power of attorney shall be enclosed with the form. The proxy form is available at https://investors.yubico.com/en/. If the power of attorney is issued by a legal entity, a copy of a certificate of incorporation, or if such authorization document doesn't exist, a corresponding document shall be enclosed. The shareholder may not provide special instructions or conditions in the voting form. If so, the vote (i.e. the postal vote in its entirety) is invalid. Further instructions and conditions are included in the form for postal voting.
PROPOSED AGENDA
- Opening of the Annual General Meeting
- Election of chairman of the Annual General Meeting
- Preparation and approval of the voting list
- Election of one or two persons to, in addition to the chairman, approve the minutes of the Annual General Meeting
- Determination as to whether the Annual General Meeting has been duly convened
- Approval of the agenda
- Presentation by the CEO
- Presentation of the annual report and the auditor's report and the consolidated financial statements and the audit report on the consolidated financial statements
- Resolutions on:
- approval of the income statement and balance sheet, and the consolidated income statement and consolidated balance sheet;
- distribution of the company's earnings in accordance with the adopted balance sheet; and
- discharge from liability for the directors of the board and the CEO for the financial year 2024
- Presentation of the remuneration report for approval
- Presentation of the nomination committee's proposals and work
- Determination of number of directors of the board and auditors
- Determination of remuneration to the directors of the board and the auditor
- Election of directors and chairman of the board of directors
- Election of auditor
- Resolution on instruction for the nomination committee
- Resolution on long-term incentive program 2025, including resolution on
- performance stock unit program,
- hedging measures in the form of newly issued class C shares including amendments to the articles of association, and
- hedging measures by entering into a share swap agreement with a third party
- Resolution on authorization for the board of directors to resolve to repurchase own shares
- Resolution on authorization for the board of directors to resolve to issue new shares
- Closing of the Annual General Meeting
PROPOSED RESOLUTIONS
Election of chairman of the Annual General Meeting (item 2)
The nomination committee proposes that the chairman of the board of directors, Patrik Tigerschiöld, is elected chairman of the Annual General Meeting.
Distribution of the company's earnings in accordance with the adopted balance sheet (item 9 b)
The board of directors proposes that no dividend shall be paid, and that the earnings at the disposal of the Annual General Meeting, a total of SEK 1,180,543,278, shall be carried forward.
Presentation of the remuneration report for approval (item 10)
The board of directors proposes that the Annual General Meeting approves the report regarding remuneration to the CEO and the board of directors for the financial year 2024.
Determination of number of directors of the board and auditors (item 12)
The nomination committee proposes that the board of directors shall consist of seven directors for the period until the end of the next Annual General Meeting.
The nomination committee proposes that the company shall have one registered audit firm as auditor.
Determination of remuneration to the directors of the board and the auditor (item 13)
For the period until the end of the next Annual General Meeting, the nomination committee proposes that remuneration of SEK 1,075,000 (previously SEK 860,000) shall be paid to the chairman of the board of directors and SEK 575,000 (previously SEK 460,000) shall be paid to each other director elected by the general meeting. Further, it is proposed that for work in the audit committee, an annual remuneration of SEK 250,000 (previously SEK 200,000) shall be paid to the chairman of the audit committee and SEK 125,000 (previously SEK 100,000) to member of the audit committee. In addition, it is proposed that for work in the remuneration committee, an annual remuneration of SEK 125,000 (previously SEK 100,000) shall be paid to the chairman of the remuneration committee, and SEK 63,000 (previously SEK 50,000) to member of the remuneration committee. No remuneration shall be paid to board member who is employed by the company.
The nomination committee proposes that remuneration to the auditor shall be paid in accordance with approved invoices.
Election of directors and chairman of the board of directors (item 14)
The nomination committee proposes that Patrik Tigerschiöld, Jaya Baloo, Stina Ehrensvärd, Gösta Johannesson, Paul Madera, Eola Änggård Runsten, and Ramanujam Shriram shall be re-elected as directors for the period until the end of the next Annual General Meeting.
The nomination committee proposes that Patrik Tigerschiöld shall be re-elected as chairman of the board of directors.
Information about the directors proposed for re-election can be found in the annual report and on the company's website, https://investors.yubico.com/en/.
Election of auditor (item 15)
The nomination committee has taken part of the audit committee's presented alternatives and recommendation regarding the election of auditor, which is based on the auditor procurement conducted prior to the Annual General Meeting 2025, which concludes that the nomination committee shall propose that the registered audit firm Öhrlings PricewaterhouseCoopers AB ("PwC") is elected as auditor for the period until the end of the next Annual General Meeting.
PwC has informed that if the nomination committee's proposal for auditor is adopted by the Annual General Meeting, Patrik Adolfson, authorized public accountant, will be appointed as the auditor in charge.
Resolution on instruction for the nomination committee (item 16)
The nomination committee proposes that the Annual General Meeting resolves to adopt the following instruction for the nomination committee to be valid until the general meeting resolves to change the instruction.
Introduction
The nomination committee shall perform its duties in accordance with the Swedish Corporate Governance Code.
Composition of the nomination committee, etc.
The company shall have a nomination committee consisting of four members appointed by each of the four major shareholders in terms of votes as set out below, who wish to appoint a member. In addition, the chairman of the board may be adjunct member of the nomination committee, however, without the right to vote.
If any of the four major shareholders in terms of votes waives its right to appoint a member to the nomination committee, the next major shareholder shall be given the opportunity to appoint a member. However, no more than five additional shareholders need to be contacted, unless the chairman of the board of directors considers that there are special reasons for doing so.
The nomination committee for the next Annual General Meeting shall be constituted on the basis of the shareholders registered in the share register maintained by Euroclear as per the last banking day in September, as well as other reliable information on shareholdings provided to the company at that time.
The chairman of the board of directors shall, as soon as information on ownership as described above is available, contact a representative of each of the four major shareholders in the company, who shall then be entitled to appoint one member each to the nomination committee. The members of the nomination committee shall be announced as soon as they have been appointed. If a member is appointed by a particular shareholder, the name of the shareholder shall be stated.
The chairman of the nomination committee shall, unless the members decide otherwise, be the member representing the largest shareholder in terms of votes. The chairman shall not be a member of the board of directors of the company.
If one or more of the shareholders who appointed members of the nomination committee earlier than two months before the Annual General Meeting cease to be one of the four major shareholders in terms of votes, members appointed by these shareholders shall vacate their seats and the shareholder or shareholders who have been added to the four major shareholders in terms of votes shall, after contacting the chairman of the nomination committee, be authorised to appoint its members.
Shareholders who have been added to the four major shareholders later than two months before the Annual General Meeting shall, instead of being part of the nomination committee, be entitled to appoint a representative who shall be co-opted to the nomination committee and thus participate without voting rights.
Shareholders who have appointed a member of the nomination committee are entitled to dismiss such member and appoint a new member. Changes in the composition of the nomination committee shall be made public as soon as they occur.
The duties of the nomination committee
The nomination committee shall present proposals to the Annual General Meeting regarding the following items:
i) election of chairman of the general meeting, ii) number of board members and auditors, iii) election of and remuneration to the chairman of the board of directors and members of the company's board of directors and, where applicable, other special committees, iv) election of and remuneration to the auditor and, where applicable, deputy auditor and v) proposals for such changes to the instruction for the nomination committee as the nomination committee has deemed appropriate. A report on the work of the nomination committee in terms of proposals and statements from the nomination committee shall be published on the company's website well in advance of the Annual General Meeting.
The company shall be informed of the nomination committee's proposal no later than six weeks before the Annual General Meeting. All information on potential new board members shall be attached to the proposal.
The mandate of the current nomination committee shall be valid until the new nomination committee is appointed in accordance with the criteria above.
Resolution on a long-term incentive program 2025, including resolution on (A) performance stock unit program, (B) hedging measures in the form of newly issued class C shares including amendments to the articles of association, and (C) hedging measures by entering into a share swap agreement with a third party (item 17)
Background and reasons
Yubico has a significant footprint in the United States and Canada and approximately two-thirds of the total number of employees of the Yubico group are located in the United States and Canada, whereas approximately one-third are located in the rest of the world, including in Sweden. During 2024, the Americas region represented approximately 68 percent of Yubico's net sales, while the rest of the world represented approximately 32 percent.
The board of directors considers it to be in the best interest of the company and its shareholders to implement a long-term incentive program ("LTI 2025") based on performance stock units ("PSUs") for senior executives, key personnel and other employees[1] in the group, in accordance with this proposal. LTI 2025 follows the same structure as the long-term incentive program 2024 adopted at the Annual General Meeting on 14 May 2024. The structure of LTI 2025 will allow to take into account market conditions in the key geographies where Yubico operates, while accommodating the company's wish to have a single and simple incentive program. LTI 2025 is proposed to include up to approximately 610 senior executives, key personnel and other employees1 within the company group.
The proposal has been based on the assessment of the board of directors that it is important, and in the interest of all shareholders, to create even greater participation in the group's development by senior executives, key personnel and other employees of the group. The board of directors also considers it important to be able to attract talent over time, to encourage continued employment and maintain a high employee retention level.
In view of the above, the board of directors proposes that the Annual General Meeting resolves to implement LTI 2025 in accordance with items (A)–(C) below.
A. Performance stock unit program
LTI 2025 comprises two different series:
Series 1 of LTI 2025 comprises PSUs which may be awarded to employees of the company group in the United States and Canada.
Series 2 of LTI 2025 comprises PSUs which may be awarded employees of the company group in the rest of the world, including Sweden.
The terms for the two different series are the same in all aspects, except for what is set out in item 5 below.
The following terms shall apply to LTI 2025:
- The maximum number of PSUs that may be awarded is 780,000. Each PSU shall entitle the holder to receive one share in the company[2], subject to two financial performance conditions (as described below) and continued employment within the company group. Accordingly, the maximum number of shares available to the participants under LTI 2025 shall be 780,000 (subject to recalculation in accordance with the terms of LTI 2025). On the basis of the geographical distribution of the participants, seniority levels, growth per region and other factors, the company expects that approximately 75 percent of the PSUs will be awarded under Series 1 and approximately 25 percent under Series 2. The CEO of the company will be awarded PSUs under Series 2.
- PSUs may be awarded to current employees of the company group. The board of directors shall have the right to decide that also a person who becomes an employee with the company group after the day of the Annual General Meeting but before 31 December 2025, may be invited to participate in LTI 2025 and be awarded PSUs, if deemed favorable for the company.
- The intention is to launch LTI 2025 and award the PSUs shortly after the Annual General Meeting. The PSUs will vest with one-third on each of three yearly vesting dates (each a "Vesting Date") occurring on the publication date of the company's interim report for the first quarter during 2026, 2027 and 2028, provided that the participant is still employed with the company group (with certain limited exemptions, such as if the participant's employment is terminated as a result of pension or long-term illness) on the applicable Vesting Date, and that the performance conditions have been satisfied during the relevant performance period preceding such Vesting Date, as set out below.
- Vesting of PSUs shall be conditional upon the level of fulfilment of two financial performance conditions relating to the company's revenue growth (the "Revenue Condition") and EBIT margin (the "EBIT Margin Condition") (each a "Performance Condition") during performance periods corresponding to each of the financial years 2025, 2026 and 2027 or, pursuant to the catch-up mechanism, as an average for the financial years 2025–2027 (CAGR) in relation to the Revenue Condition or during 2027 in relation to the EBIT Margin Condition, as applicable. 60 percent of the PSUs that are allotted to holders shall be related to fulfillment of the Revenue Condition, and 40 percent of the PSUs that are allotted to holders shall be related to fulfillment of the EBIT Margin Condition.
Revenue Condition:
Revenue growth during a financial year exceeding 20 percent as entry level, 25 percent as target level and 30 percent as stretch level.
EBIT Margin Condition:
EBIT margin during 2025 exceeding 16.5 percent as entry level, 18.5 percent as target level and 20.5 percent as stretch level. EBIT margin during 2026 exceeding 18 percent as entry level, 20 percent as target level and 22 percent as stretch level. EBIT margin during 2027 exceeding 19 percent as entry level, 21 percent as target level and 23 percent as stretch level.
A linear interpolation shall be applied between the entry level and the stretch level, whereby the entry level constitutes the minimum level which must be reached in order to enable vesting of PSUs, subject to the catch-up mechanism. If the entry level is reached, vesting of 80 percent of the relevant PSUs shall occur. If the target level is reached, vesting of 100 percent of the relevant PSUs shall occur.
Catch-up:
Revenue Condition: To satisfy the Revenue Condition, participants shall be entitled to apply average performance during 2025–2027 (CAGR), instead of annualized performance for each of 2025, 2026 and 2027, whereby the entry level for the Revenue Condition (CAGR) is 20 percent, the target level is 25 percent and the stretch level is 30 percent.
EBIT Margin Condition: To satisfy the EBIT Margin Condition, participants shall be entitled to apply the EBIT margin during 2027, instead of annualized performance for each of 2025, 2026 and 2027, whereby the entry level for the EBIT Margin Condition (2027) is 19 percent, the target level is 21 percent and the stretch level is 23 percent.
Catch-up shall only be available to a participant who is still employed within the company group on the date of publication of the company's interim report for the first quarter during 2028. The maximum number of vested PSUs will not exceed 100 percent of the total number of PSUs awarded.
Over-achievement:
If the stretch level is reached, vesting of 120 percent of the relevant PSUs shall occur, provided that vesting exceeding 100 percent shall only occur to the extent there is an underachievement of the other Performance Condition for the same performance period, or for all of 2025–2027 or 2027 if the catch-up mechanism is applied in relation to the Revenue Condition or EBIT Margin Condition respectively, as applicable, such that the level of fulfilment of both Performance Conditions during the relevant period as an average may never exceed 100 percent.
- Each vested PSU of Series 1 will entitle the holder to receive pay-out of one share in the company subject to the terms of LTI 2025 as soon as practicable after each Vesting Date. Each vested PSU of Series 2 will entitle the holder to receive pay-out of one share in the company subject to the terms of LTI 2025 as soon as practicable after the Vesting Date in 2028. Any PSUs that have not been vested at the Vesting Dates (and that are not subject to catch-up) will lapse and be deemed forfeited without consideration.
- The board of directors shall be entitled to recalculate the maximum number of shares (per PSU and in total) in the event of intervening rights issues, bonus issues, share splits, reverse share splits, or similar events, with the aim to achieve the same economic intention of the awards for the participants.
- In the event of a change in control of the company meaning a party, or several parties acting in concert, acquiring shares representing more than 90 percent of the votes in the company or a direct or indirect sale, transfer or other disposal of all or substantially all of the business and assets, any unvested PSUs shall vest pro rata to time and performance achieved at the board of directors' discretion through the change in control and be settled in accordance with the terms of LTI 2025.
- The PSUs will have no voting rights, the number of PSUs will not be increased and no cash will be paid as dividend equivalent for vested PSUs.
- The maximum number of shares in Yubico which may be allocated under LTI 2025 shall be limited to 780,000, which represents approximately 0.9 percent of all shares and votes in Yubico. The program is expected to result in certain costs, mainly related to accounting (IFRS2), salary costs and social security costs. If 100 percent of the PSUs in LTI 2025 will be vested, the salary costs (IFRS2), which is a non-cash item, for the PSUs are estimated to amount to approximately SEK 112.0 million during the term of LTI 2025, based on the closing price of Yubico's share as of 4 April 2025. Social security costs are estimated to amount to approximately SEK 20.5 million, assuming a share price increase of 100 percent at the time of pay-out of shares, and SEK 15.6 million assuming a 50 percent share price increase. The salary costs will be recognized during the term of LTI 2025 based on the changes in vesting of the PSUs. The total social security costs during the term of LTI 2025 will depend on the geographical split of the participants, the number of PSUs that will be vested and the value of the benefit that the participant will receive. All calculations above are indicative and only serves to illustrate the costs that LTI 2025 can entail.
- To secure the delivery of shares to participants in LTI 2025, the board of directors' proposal is, as a preferred alternative, that the Annual General Meeting resolves to introduce a new share class, called class C shares. Such class C shares shall be redeemable and, upon a resolution by the board of directors, convertible into ordinary shares in Yubico. The board of directors furthermore proposes that the Annual General Meeting authorizes the board of directors to resolve to issue class C shares to an external party consulted by the board in advance, and to repurchase the class C shares from the external party. The class C shares will thereafter be held as such during the vesting periods for LTI 2025 and, once required for delivery purposes under LTI 2025, be converted into ordinary shares and transferred to eligible participants in LTI 2025. The board of directors considers this alternative to be the most cost efficient and flexible hedging method. In the event that the proposed hedging measure in accordance with item (B) below is not approved with the required majority, the board of directors instead proposes, as a second option, that the company may hedge its obligations under LTI 2025 by entering into a share swap agreement with a third party, whereby the third party in its own name shall be entitled to acquire and transfer shares (including to the participants), in accordance with item (C) below.
- LTI 2025 will be governed by Swedish law.
Allocation principles, etc.
The participants' right to be allotted PSUs is differentiated between employees with reference to inter alia role and responsibility in the group. The participants have on this basis been divided into three different categories:
Category A (not more than 10 persons): Members of the senior management.
Category B (not more than 100 persons): Management and employees whose performance has a direct impact on the financial performance of the company.
Category C (not more than 500 persons): Other employees.
| Category | Maximum number of PSUs for a participant | Maximum total number of PSUs within the category |
| Category A | 100,000 | 335,000 |
| Category B | 10,000 | 235,000 |
| Category C | 5,000 | 210,000 |
| Total maximum Category A, B and C | N/A | 780,000 |
Administration of LTI 2025
The board of directors shall be responsible for the design, interpretation and management of PSUs awarded under LTI 2025 within the framework of the above-mentioned principal terms and conditions. In the event that a participant cannot, after a Vesting Date, receive pay-out of shares from vested PSUs under applicable laws or regulations or at reasonable cost or with reasonable administrative effort by the participant or the company, the board of directors shall have the right to decide to settle the PSUs wholly or partly in cash. The board of directors shall also have the right to in its own discretion decide that shares and/or cash shall be withheld by the company in order to cover or facilitate the payment of applicable taxes. The board of directors may allow consultants to participate in LTI 2025 if the requirements of LTI 2025 can be appropriately applied in relation to such person.
The board of directors also has the right to adjust detailed terms and conditions of PSUs in the event of significant changes within the group or its operational environment that entail that the framework established for PSUs under LTI 2025 is no longer reasonable or appropriate, provided that such changes are not more favorable to the participant than the terms and conditions set forth in this proposal. The board of directors shall review whether the outcome of LTI 2025 is reasonable considering the company's financial results and position and other circumstances, such as social, ethics and compliance factors, and, if not, determine to reduce the allotment under LTI 2025 to a lower level that is deemed appropriate by the board of directors.
Specific motivation
According to the Remuneration Rules (Rules on Remuneration of the Board and Executive Management and on Incentive Programmes) that are administered by the Stock Market Self-Regulation Committee (Sw. Aktiemarknadens självregleringskommitté) it should be specified and motivated why the vesting period or period from the commencement of the agreement until a share may be acquired is less than three years. PSUs of Series 1, which are held by participants in the United States and Canada, may entitle to pay-out of shares under certain conditions already after approximately one year. The reason for having a shorter vesting period and a shorter period than three years until pay-out of shares for these participants is to ensure that the company has a competitive offer as an employer in the United States and Canada and to meet the requirements of international tech talent which is instrumental for the company's future success and development.
Preparation
LTI 2025 has been prepared by the remuneration committee and adopted by the board of directors of Yubico.
B. Hedging measures in the form of newly issued class C shares including amendments to the articles of association
B.1 Introduction
To be able to implement LTI 2025 in a cost-effective and flexible manner, the board proposes that the company's obligation to deliver shares to the participants in LTI 2025 and the company's cash flow for payment of social security cost attributable to the delivery of such shares, as a preferred alternative, be secured through a directed issue of convertible and redeemable class C shares. These shares may be repurchased and converted into ordinary shares and transferred as follows.
B.2 Amendments to the articles of association
The company's articles of association are amended to make it possible to issue a new class of shares, called class C shares, which entitle holders to one tenth of a vote per share. No dividends are payable for class C shares. Furthermore, class C shares can be redeemed at the quota value of the share following a decision by the board. It will also be possible to convert class C shares into ordinary shares following a decision by the board. All shares which are currently issued shall be ordinary shares.
The board proposes that section 5 of the articles of association be amended as follows:
| Current wording |
| § 5 Number of shares The number of shares shall be not less than 50,000,000 and not more than 200,000,000 shares. |
| Proposed wording |
| § 5 Number of shares The number of shares shall be not less than 50,000,000 and not more than 200,000,000 shares. Two types of shares may be issued: ordinary shares and class C shares. Ordinary shares may be issued up to a total of no more than 100 percent of all shares in the company and class C shares up to a total of no more than 5.0 percent of all shares in the company. Ordinary shares have one vote and class C shares have one tenth (1/10) of a vote. No dividends are payable for class C shares. In the event of the dissolution of the company, class C shares shall give an entitlement to the same share of the company's assets as the company's ordinary shares, but no higher than that which corresponds to the quota value of the shares. If the company decides to issue new ordinary shares and class C shares through a cash issue or set-off issue, owners of ordinary shares and owners of class C shares shall have preferential rights to subscribe for new shares of the same share class in relation to the number of shares previously owned (primary preferential rights). Shares that have not been subscribed for with primary preferential rights shall be offered to all shareholders for subscription (subsidiary subscription). If offered shares are not sufficient for the subscription that takes place with subsidiary preferential rights, the shares shall be distributed among subscribers in proportion to the number of shares they previously own and, to the extent that this is not possible, by drawing of lots. If the company decides to issue only ordinary shares or class C shares through a cash issue or set-off issue, all shareholders, regardless of whether their shares are ordinary shares or class C shares, shall have the right to subscribe for new shares in proportion to the number of shares they previously own. What has been said above shall not entail any restriction on the option of deciding on a cash issue or set-off issue with deviation from the shareholders' preferential rights. What is prescribed above regarding shareholders' preferential rights shall apply correspondingly to such issues of warrants or convertibles that do not take place against payment with non-cash assets. In the event of an increase in the share capital through a bonus issue, new shares shall be issued for each share class in relation to the number of shares of the same type that already exist. In this case, old shares of a certain class of shares shall carry the right to shares of the same class of shares. What has now been said shall not entail any restriction on the possibility of issuing shares of a new type through a bonus issue, after the necessary amendment of the articles of association. The board has the right to decide on a reduction of the share capital through the redemption of all class C shares. When deciding on redemption, holders of class C shares shall be obliged to have all their class C shares redeemed for an amount corresponding to the quota value. Payment of the redemption amount shall be made as soon as possible. When deciding on redemption of class C shares an amount corresponding to the redemption amount shall be allocated to the company's reserve fund. Class C shares held by the company itself, may at the request of the board, be converted into ordinary shares. The conversion shall without delay be reported for registration to the Swedish Companies Registration Office and is effective when the registration is completed, and the conversion has been recorded in the central securities depository register. |
B.3 Authorization for the board of directors to resolve on a directed issue of class C shares
The board of directors shall be authorized to resolve on a directed issue of redeemable and convertible class C shares in the company on the following terms:
- The number of class C shares that may be issued may not exceed 865,000.
- New class C shares shall, with deviation from the shareholders' preferential rights, only be subscribed for by an external party consulted by the board in advance.
- The amount to be paid for each new class C share (the subscription price) shall correspond to the quota value of the share at the time of the share subscription. Payment for new class C shares shall be made in cash.
- The authorization may be exercised on one or more occasions until the Annual General Meeting 2026.
- The new class C shares shall be subject to a reservation in accordance with Chapter 4, Section 6 of the Swedish Companies Act (conversion clause) and Chapter 20, Section 31 of the Swedish Companies Act (redemption clause).
The purpose of the authorization is to secure the company's commitments under LTI 2025 and to cover cash flow effects of the payment of future social security costs attributable to PSUs.
B.4 Authorization for the board of directors to resolve on repurchase of class C shares
The board of directors shall be authorized to resolve on the repurchase of class C shares in the company on the following terms:
- Repurchases may take place through a purchase offer addressed to all owners of class C shares in the company.
- The number of class C shares that may be repurchased may not exceed 865,000.
- Repurchases shall be made at a cash price per share of a minimum of 100 percent and a maximum of 110 percent of the quota value that applies at the time of repurchase.
- The board shall have the right to determine other terms for the repurchase.
- Repurchase shall also be possible for so-called interim shares in respect of class C shares, referred to as Paid Subscribed Shares (BTA) by Euroclear Sweden AB.
- The authorization may be exercised on one or more occasions until the Annual General Meeting 2026.
The intention of the authorization is to secure the company's commitments under LTI 2025 and to cover cash flow effects of the payment of future social security costs attributable to PSUs.
B.5 Approval of transfer of ordinary shares in the company within the framework of LTI 2025
The board proposes that the Annual General Meeting approves the transfer of ordinary shares owned by the company under LTI 2025 on the following terms:
- A maximum of: (i) 780,000 Yubico shares may be transferred free of charge to participants in LTI 2025, and (ii) 85,000 Yubico shares may be transferred, on one or more occasions, at Nasdaq Stockholm for the time until the next Annual General Meeting at a price within the registered price range at any time in order to secure the company's payment of social security cost in terms of cash flow. The reasons for the deviation from the shareholders' preferential rights are that such transfers of Yubico shares are part of the implementation of LTI 2025.
- The conditions for these transfers, the number of shares in each transaction and the time of transfer must follow the terms and conditions of LTI 2025.
- The number of Yubico shares that may be transferred within the framework of LTI 2025 shall be recalculated according to customary principles as a result of bonus issue, split, rights issue and/or other similar events.
- The resolution in item a) above regarding the transfer of shares on the stock market is expected to be proposed for a new resolution at future Annual General Meetings during the term of LTI 2025.
B.6 Reasons for deviation from the shareholders' preferential rights
The reason for deviating from the shareholders' preferential rights is that the issue of class C shares and thereto relating resolutions in this item (B) is part of implementing and executing LTI 2025, in accordance with the purpose of LTI 2025 described under "Background and reasons" in item (A) above.
As the board believes that the transfer of own Yubico shares to the participants of LTI 2025 is most cost-effective, it is primarily proposed that hedging measures regarding LTI 2025 are carried out in accordance with this item (B). If the required majority cannot be achieved for the proposal according to this item (B), the Board will enter into a share swap agreement in accordance with item (C) below.
B.7 Majority requirements
A resolution in accordance with item (A) above (including item (C) below), requires support from a majority of more than half of the votes cast at the Annual General Meeting.
A resolution in accordance with this item (B) is valid only where supported by shareholders representing at least nine tenths of both the votes cast and the shares represented at the Annual General Meeting.
B.8 Authorization for the board of directors to make adjustments
The board of directors, or a person appointed by the board, shall be authorized to make such minor adjustments to the above resolutions as may be necessary in connection with the registration with the Swedish Companies Registration Office or Euroclear Sweden AB.
C. Hedging measures by entering into a share swap agreement with a third party
In the event that the required majority cannot be achieved for a resolution under item (B) above, the company shall hedge against the financial exposure that LTI 2025 is expected to entail by entering into a share swap agreement with a third party, whereby the third party shall acquire, and transfer shares included in LTI 2025 in its own name. The relevant number of shares in this context shall correspond to the number of shares proposed under item (B) above.
The board believes that the most cost-effective and flexible method to transfer Yubico shares under LTI 2025 is transferring own shares as described in item (B) above. The cost of hedging by entering into a share swap agreement with a third party is significantly higher and will be based on an interest rate and additional costs associated with the company's borrowing costs given the structure of the share swap derivative and prevailing market conditions at the time of any such agreement.
Resolution on authorization for the board of directors to resolve to repurchase own shares (item 18)
The board of directors proposes that the Annual General Meeting resolves on authorization for the board of directors to resolve on repurchase of own shares in accordance with the following conditions:
- Repurchase of shares shall take place on Nasdaq Stockholm.
- Repurchase of shares may take place on one or more occasions during the time until the next Annual General Meeting.
- The number of shares that may be repurchased shall be limited such that Yubico's holding of its own shares, excluding holding of any own class C shares, does not at any time exceed five (5) percent of all shares in Yubico.
- Repurchase shall be made at a price per share that is within the price range for the share price prevailing at any time (the so-called spread), i.e. the range between the highest ask price and the lowest bid price. In the event that the repurchase is effected by a stock broker as assigned by the company, the price of shares may, however, correspond to the volume weighted average price during the time period within which the shares were acquired, even if the volume weighted average price on the day of delivery to the company falls outside the price range.
- Payment for the shares shall be made in cash.
The purpose of the authorization is to give the board of directors the possibility to use the company's share as means of payment in connection with potential acquisitions, or to use the repurchased shares to finance potential acquisitions, and additional flexibility in the board's efforts to deliver long-term shareholder value and total return.
Resolution on authorization for the board of directors to resolve to issue new shares (item 19)
The board of directors proposes that the Annual General Meeting resolves on authorization for the board of directors to resolve on a new issue in accordance with the following.
The board of directors shall be authorized to resolve to issue new shares in the company on one or several occasions for the period up to the next Annual General Meeting, to the extent that such new issue can be made without amending the articles of association. An issue may be made with or without deviation from the shareholders' preferential rights. Based on the authorization, the board of directors may resolve to issue a number of new shares corresponding to a maximum of ten (10) percent of the total number of outstanding shares in the company at the time of the Annual General Meeting.
The board of directors shall be authorized to resolve on issue where payment is made in cash, by contribution in kind or by way of set-off. A cash issue or issue by way of set-off that takes place with deviation from the shareholders' preferential rights shall be in line with market terms.
The purpose of the authorization and the reasons for any deviation from the shareholders' preferential rights are to be able to use the company's share as means of payment in connection with potential acquisitions, or to use the issue of shares to finance potential acquisitions, or enable other investments to meet the company's strategic goals.
SPECIAL MAJORITY REQUIREMENTS
A resolution by the Annual General Meeting under item 17 (B) and (C) shall be conditional upon the Annual General Meeting resolving to establish LTI 2025 in accordance with the board of directors' proposal under item 17 (A). The proposal under item 17 (B) is valid only where supported by shareholders representing at least nine tenths of both the votes cast and the shares represented at the Annual General Meeting.
Resolutions by the Annual General Meeting in accordance with items 18 and 19 are valid only where supported by shareholders representing at least two thirds of both the votes cast and the shares represented at the Annual General Meeting.
AUTHORIZATION
The CEO, or anyone appointed by the CEO, shall be authorized to make the minor adjustments in the meeting's resolutions that may be required in connection with registration at the Swedish Companies Registration Office or due to other formal requirements.
DOCUMENTS
Accounting documents, the auditor's statement and other documents that shall be made available pursuant to the Swedish Companies Act and the Swedish Code of Corporate Governance, will be made available, at the company and on the company's website, https://investors.yubico.com/en/, from no later than April 22, 2025 and will be sent immediately and free of charge for the recipient to any shareholder who requests the documents and provide their postal or e-mail address. The documents will also be available at the Annual General Meeting.
NUMBER OF SHARES AND VOTES
As of the date of this notice, the total number of shares in the company is 86,265,718 shares, corresponding to a total number of 86,265,718 votes. The company held no shares in treasury at the time of issuing this notice.
SHAREHOLDER'S RIGHT TO REQUEST INFORMATION
The board of directors and the CEO shall, if any shareholder so requests and the board of directors believes that it can be done without material harm to the company, provide information regarding circumstances that may affect the assessment of an item on the agenda, circumstances that may affect the assessment of the company's or its subsidiaries' financial situation, the company's relationship to another group company and the consolidated financial statements. Shareholders who wish to send in questions in advance can do so in writing to Yubico AB, Att: Legal, Gävlegatan 22, SE-113 30, Stockholm, Sweden or by e-mail to investoragm@yubico.com.
PERSONAL DATA PROCESSING
For information on how your personal data is processed, please refer to:
https://www.euroclear.com/dam/ESw/Legal/Privacy-notice-bolagsstammor-engelska.pdf and
https://www.computershare.com/se/gm-gdpr#English
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Stockholm in April 2025
Yubico AB
The board of directors
[1] Including consultants if specifically approved by the board of directors as set out under "Administration of LTI 2025" .
[2] The company shall be entitled to require that the holder pays the quota value for each share, depending on in which manner share delivery under LTI 2025 is arranged for.