Corporate Governance

CoinShares International Limited is a public limited liability company incorporated in Jersey, Channel Islands. The corporate governance structure is predominantly based on Companies (Jersey) Law, 1991, the articles of association and internal rules, including policies and instructions. As a company listed on Nasdaq Stockholm, the company will also apply the Nordic Main Market Rule book for Issuers and the Swedish Corporate Governance Code (the “Code”). The Code sets a higher standard for good corporate governance than the minimum standards of the Companies (Jersey) Law, 1991, and other rules.

At the Annual General Meeting of CoinShares International Limited (the “AGM”) held 20 June 2022, the Shareholders adopted the principals for the appointment of the Nomination Committee. According to those instructions, the Nomination Committee be composed of:

(i) representatives of the three largest shareholders of the company in terms of votes, who are registered in the share register maintained by Euroclear Sweden AB as of the last trading day in August each year, and

(ii) a representative of the Board of Directors, who shall also convene the Nomination Committee to its first meeting.

With effect from 15 November 2023, Nomination Committee shall comprise of:

• Michael Carlton, appointed by Daniel Masters, Chair of the Nomination Committee

• Jean-Frédéric Mognetti, appointed by Mognetti Partners Limited

• Paul Davidson, appointed by Russell Newton

• Johan Lundberg, representative of the Board of Directors of CoinShares International Limited

Prior to the 2024 AGM, the Nomination Committee shall submit proposals regarding the election of the Chair of the AGM, the number of Directors to be elected by the AGM, the election of the Board Chairperson and Directors, fees and other remuneration payable to elected Directors and members of Board Committees, the election of auditor(s), the principles for the composition of the Nomination Committee and any changes to the instructions issued to the Nomination Committee. CoinShares International Limited’s Annual General Meeting will be held on 31 May 2024.

Shareholders wishing to have a matter discussed at the AGM must submit such a proposal to the Chair of the Board by sending an email to [email protected] or a letter to CoinShares International Limited, Company Secretary, 2 Hill Street, St Helier, Jersey, JE2 4UA, by 12 April 2024 to be included in the notice convening the AGM.

The general meeting is the ultimate decision-making body of the company. At the general meeting, the shareholders exercise their voting rights on key issues, such as the adoption of income statements and statements of financial position, appropriation of the company’s results, discharge from liability of members of the Board of Directors and the CEO, election of members of the Board of Directors and auditors and remuneration to the Board of Directors and the auditors.

The AGM must be held within six months from the end of the financial year. In addition to the AGM, extraordinary general meetings may be convened. As permitted under article 38. Notices of the articles of association, general meetings are convened by publication of the notice convening the meeting on the company’s website and via a press release.

Those who wish to participate in a general meeting must:

1) be recorded in the share register kept by Euroclear Sweden AB on the record date, being ten clear days prior to the general meeting; and

2) notify the Company of their intention to participate no later than on the date set out in the notice of the general meeting.

In addition to notifying the company, shareholders whose shares are registered under a nominee through a bank or other nominee must request that their shares be temporarily registered in their own names in the share register ten clear days prior to the general meeting in order to be entitled to participate in the general meeting. Shareholders should inform their nominees well in advance of the record date. Shareholders may attend general meetings in person or by proxy.

Every shareholder has the right to have a matter taken up for consideration at a general meeting. A shareholder who wishes to have a matter taken up for consideration at a general meeting must submit a written request about such to the Board of Directors. Such a request must normally be received by the Board not later than seven weeks prior to the general meeting in question.

Pursuant to the Code, companies whose shares are admitted to trading on a regulated market in Sweden shall have a Nomination Committee. It is proposed that the following instruction for the nomination committee, be considered for adoption at the AGM

The Nomination Committee shall prior to the AGM be composed of:

(i) representatives of the three largest shareholders of the company in terms of votes, who are registered in the share register maintained by Euroclear Sweden AB as of the last trading day in August each year, and

(ii) a representative of the Board of Directors, who shall also convene the Nomination Committee to its first meeting.

The Nomination Committee shall meet the requirements of composition set out in the Code. The majority of the members of the nomination committee are to be independent of the company and its executive management. Neither the chief executive officer nor other members of the executive management are to be members of the Nomination Committee. At least one member of the Nomination Committee is to be independent of the company’s largest shareholder in terms of votes or any group of shareholders who act in concert in the governance of the company. If the larger shareholders who have the right to appoint members of the nomination committee wish to appoint persons with the consequence that the requirements of composition provided in the Code are not met, the first choice of the larger shareholder shall have precedence over a smaller shareholder. At the appointment of a new member, the shareholder who shall appoint the new member shall consider the composition of the current Nomination Committee.

Should any of the three largest shareholders abstain from their right to appoint a member of the Nomination Committee, the right to appoint a member shall pass to the next shareholder in line that does not already have the right to appoint a member of the Nomination Committee. However, the procedure shall only continue until the earlier of (i) five additional shareholders have been asked; or (ii) the Nomination Committee is complete.

The name of the members and the shareholders they represent shall be made public on the company’s website no later than six months prior to the AGM. The mandate period of the Nomination Committee shall extend until the next nomination committee is appointed. Changes in the composition of the nomination committee shall be made public on the website of the company as soon as they have occurred.

If a change in the company’s ownership structure occurs after the last trading day in August but before the date which occurs three months ahead of the forthcoming annual shareholders’ meeting, and if a shareholder that after this change has become one of the three largest shareholders in terms votes, who are registered in the share register of the company, makes a request to the Chair of the Nomination Committee to be part of the Nomination Committee, the shareholder shall have the right, in the discretion of the nomination committee, either to appoint an additional member of the Nomination Committee or to appoint a member who shall replace the member appointed by the, after the changes in the ownership structure, smaller shareholder in terms of votes.

A shareholder who has appointed a member of the Nomination Committee has the right to dismiss the member and appoint a new member. If such an exchange takes place, the shareholder shall without delay give notice of this to the chair of the nomination committee (or, if it is the chair of the nomination committee who shall be exchanged, to the Chair of the Board of Directors). The notification shall contain the name of the dismissed member and the person who shall replace him as member of the Nomination Committee.

A member who prematurely resigns from his task shall give notice of this to the chair of the Nomination Committee (or, if it is the chair of the Nomination Committee who resigns, to the chair of the board of directors). In such case, the Nomination Committee shall without delay call upon the shareholder who has appointed the member to appoint a new member. If a new member is not appointed by the shareholder, the Nomination Committee shall offer other larger shareholders with respect to votes, to appoint members of the Nomination Committee. Such offer shall be made in order of priority to the largest shareholders with respect to votes (that is, first to the largest shareholder with respect to votes who has not already appointed a member of the Nomination Committee or previously abstained from the right to do so, thereafter to the second largest shareholder with respect to votes who has not already appointed a member of the Nomination Committee or previously abstained from the right to do so etc.). The procedure shall continue until the earlier of (i) five additional shareholders have been asked; or (ii) the Nomination Committee is complete.

It is proposed that each of the non-employed members of the Nomination Committee be paid GBP 5,000 per annum and that the company shall defray all reasonable expenses that are required for the work of the Nomination Committee.

The members of the nomination committee are to promote the common interests of all shareholders and not to reveal the content or details of nominations discussions unduly. Each member of the nomination committee is to consider carefully whether there is any conflict of interest or other circumstance that makes membership of the nomination committee inappropriate before accepting the assignment.

The nomination committee shall fulfil the tasks set out in the Code and shall, when applicable, present proposals for resolutions to an upcoming general meeting as regards:

1. Election of the Chair of the general meeting.

2. Election of the Chair and the members of the Board of Directors.

3. Fees and other remuneration to each of the elected Board members and to the members of the Board of Director’s committees.

4. Election of the auditor/auditors.

5. Remuneration to the auditor/auditors

The nomination committee’s proposals are to be presented in the notice of the shareholders’ meeting where the elections of Board members or auditors are to be held as well as on the company’s website. At a general meeting where the election of Board members or auditors is to be held, the nomination committee is to present and explain its proposals with regard to the requirements concerning composition of the Board set out in the Code. The Nomination Committee has the right, at the company’s expense, to engage external consultants whom the Nomination Committee considers necessary to fulfill its task.

On 24 November 2020, the Board resolved to grant key employees a total of 2,995,920 share options. Of these share options, 1,011,320 were issued with 13 March 2023 as the vesting date and the remaining 1,994,600 share options, held by the Group’s Head of Asset Management, Frank Spiteri, are subject to certain vesting criteria that need to be fulfilled; (i) double the Group’s AUM, (ii) double the customer count and (iii) drive team performance (determined by the Board). The vesting terms are outlined in a separate share option agreement between the company and Frank Spiteri.

The following terms apply to all 2,995,920 share options:

- each share option gives the share option holder the right to subscribe for one ordinary share in the company;

- the share options were issued free of charge; and

- the subscription price (strike price) for each ordinary share amounts to GBP 1.43, equivalent to the fair market value of one ordinary share at issuance as determined by a third party valuation specialist.

On 22 February 2021, the Board resolved to grant key employees a total of 183,489 share options. The following terms apply to all 183,489 share options:

- the share options would vest in eight equal tranches over the 24 months from the date of issue, being 11 March 2021;

- each share option gives the share option holder the right to subscribe for one ordinary share in the company;

- the share options were issued free of charge; and

- the subscription price (strike price) for each ordinary share amounts to SEK 44.9, equivalent to the subscription price in the Prospectus dated 22 February 2021.

On 26 March 2021, the Board resolved to grant key employees a total of 373,944 share options. The following terms apply to all 373,944 share options:

- vesting date of 19 April 2024;

- each share option gives the share option holder the right to subscribe for one ordinary share in the company;

- the share options were issued free of charge; and

- the subscription price (strike price) for each ordinary share amounts to SEK 94.4.

On 21 January 2022, the Board resolved to grant key employees a total of 670,002 share options. The following terms apply to all 670,002 share options:

- vesting date of 18 March 2025;

- each share option gives the share option holder the right to subscribe for one ordinary share in the company;

- the share options were issued free of charge; and

- the subscription price (strike price) for each ordinary share amounts to SEK 82.3.

On 27 May 2022, the Board resolved to grant key employees a total of 40,400 share options. The following terms apply to all 40,400 share options:

- vesting date of 1 March 2025;

- each share option gives the share option holder the right to subscribe for one ordinary share in the company;

- the share options were issued free of charge; and

- the subscription price (strike price) for each ordinary share amounts to SEK 114.

On 20 February 2023, the Board resolved to grant key employees a total of 448,000 share options. The following terms apply to all 448,000 share options:

- vesting date of 20 March 2026;

- each share option gives the share option holder the right to subscribe for one ordinary share in the company;

- the share options were issued free of charge; and

- the subscription price (strike price) for each ordinary share amounts to SEK 31.

On 19 March 2024, the Board resolved to grant key employees a total of 115,000 share options. The following terms apply to all 115,000 share options:

- vesting date of 20 March 2027;

- each share option gives the share option holder the right to subscribe for one ordinary share in the company;

- the share options were issued free of charge; and

- the subscription price (strike price) for each ordinary share amounts to SEK 50.4.

As of 21 March 2023, 1,004,254 of total share options had either been exercised, cancelled or lapsed.

If all 3,755,501 outstanding share options in the company were to be exercised for subscription of ordinary shares, the maximum dilution amounts to approximately 5.26 percent of the number of outstanding ordinary shares as at 21 March 2024.

Members of the board of directors are normally appointed by the annual general meeting for the period until the end of the next annual general meeting. According to the company’s articles of association the general meeting shall appoint no less than three and no more than ten board members. Pursuant to the Code, the chair of the board shall be appointed at the general meeting. No more than one board member elected by the general meeting may be a member of the executive management of the company or a subsidiary of the company.

The majority of the board members elected by the general meeting are to be independent of the company and its executive management. At least two of the board members who are independent of the company and its executive management are also to be independent in relation to the company’s major shareholders.

See Director Bios in the Investor Relations section for an account of the board members’ independence in relation to the company, its executive management and its major shareholders.

The board of directors is the company’s second-highest decision making body after the general meeting. The duties of the board of directors are primarily set forth in the Companies (Jersey) Law, 1991, the company’s articles of association and the Code. In addition, the work of the board of directors is guided by the instructions from the general meeting as well as the terms of reference for the board of directors. The terms of reference for the board of directors governs the division of work within the board of directors. The board of directors also adopts instructions for the committees of the board of directors, terms of reference for the CEO and an instruction for the financial reporting to the board.

The board of directors is responsible for the organisation and the management of the company’s matters, which, among other things, entails a responsibility for outlining overall, long-term strategies and objectives, budgets and business plans, establishing guidelines to ensure that the operations create value in the long term, reviewing and establishing the accounts, making decisions on issues regarding investments and sales, capital structure and distribution policy, developing and adopting material policies, ensuring that control systems exist for monitoring that policies and guidelines are followed, ensuring that there are systems for monitoring and controlling the operations and risks, significant changes in the organisation and operations, appointing the CEO and, in accordance with the guidelines adopted by the general meeting, setting remuneration and other terms of employment benefits for the CEO and other senior executives. The chair of the board of directors is responsible for ensuring that the board of directors’ work is carried out efficiently and that the board of directors fulfils its obligations.

The board of directors meet according to an annual predetermined schedule. In addition to ordinary board meetings, board meetings may be convened where the chair considers it to be necessary or a board member or the CEO so requests.

The Board of CoinShares International Limited has established three committees – an Executive Management Committee, an Audit Committee and a Remuneration Committee.

The annual general meeting on 31 May 2023 resolved that remuneration for the board members, for the period until the end of the annual general meeting 2024, is to be not more than GBP 325,000 in total, including remuneration for committee work (GBP 325,000 previous year), and shall be paid to the board of directors in the amount of GBP 50,000 for each of the non-employed directors, which includes all committee membership and committee chair positions, and GBP 125,000 to the chair provided that the chair is not an employee.

The board members are not entitled to any benefits following termination of their assignment as directors of the board.

The CEO is subordinated to the Board of Directors and is responsible for the day- to-day management and operations of the company in accordance with the instructions from the board of directors. The division of work between the Board of Directors and the CEO is set out in the rules of procedure for the Board of Directors and the instructions for the CEO.

For information on remuneration to Group management, please see Remuneration Procedure.

The Company’s auditors, Baker Tilly Channel Islands Limited, were initially elected as auditors of the company in 2021 and performed a historical audit of the company’s financial statements from 2018 to date. At the 2023 AGM, Baker Tilly Channel Islands Limited were re-elected for a period until the end of the 2024 AGM.

Ewan John Spraggon was appointed auditor-in-charge. Ewan is a Fellow of the Institute of Chartered Accountants of England and Wales, and a member of the Institute of Chartered Accountants of Scotland.

The address of the office of Baker Tilly Channel Islands Limited is 1st Floor Kensington Chambers, 46/50 Kensington Place, St Helier JE4 0ZE, Jersey.