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2014-04-14

Starbreeze AB : regarding the Extraordinary General Meeting, reverse stock split, the introduction of stock option programs and reinforcement of the Board of D

Starbreeze AB, one of Sweden's leading game developers, today announced that a
notice of the Extraordinary General Meeting will be made public tomorrow
regarding the implementation of an employee stock option program,
reinforcement of the Board of Directors and the reverse stock split prior to
the transfer to First North. The Board of Directors has today decided to
submit proposals hereon to the EGM.
The Nomination Committee proposes that the Board of Directors, currently at
four members, to be reinforced with yet another board member, and that Eva
Redhe Ridderstad is appointed as this new board member.
The Board of Directors has decided to propose a new, broad stock option
program for Starbreeze AB. The new program involves a major addition to the
stock option program that was introduced in 2012 as part of the acquisition
of OVERKILL Software with had the aim to retain a number of key employees of
the acquired company.
The Board proposes that the General Meeting resolves on the implementation of
a broad stock option program, both in the form of stock options for the
majority group of employees, as well as an additional offer for group
management and certain key employees in the form of warrants. The stock
options are proposed to run over four years and vest by 1/3 over the first
three years, linked to continued employment, and have an exercise price equal
to 120% current market price. Warrants are proposed to have three-year term
and an exercise price of 200% of the current share price which is acquired at
market price according to Black&Schole. The stock options, proposed hedged
with underlying warrants on the same terms as the options, corresponding to a
dilution of 3.3% before "over-hedge" of social security contributions, and
4.1% with regard to the "over-hedge" social costs on exercise. Warrants that
management and key employees can acquire at market price correspond to a
dilution of an additional 1.3%.
More information on this broad stock option program and about Eva Redhe
Ridderstad can be found in the Notice of Extraordinary General Meeting.
In conjunction with the reinforcement of the Board of Directors it is proposed
that the EGM resolves the so-called Board options. Eva Redhe Ridderstad is
thus proposed to get assigned two kinds of options with a total dilution of
approximately 0.4%, and half in the form of stock options with terms similar
to those applicable to management's stock options at the side of vesting and
duration, both half in the form of warrants with terms equivalent to those
provided to senior management/key personnel for purchase at market price.
Matias Myllyrinne has expressed a desire for Board options and is proposed to
on technical reasons only be allocated stock options free-of-charge,
representing a dilution of approximately 0.2%.
The total dilution effect of the various proposals for new options as above
corresponds to 6.0%, which in addition to dilution of existing stock options
2012-12-15 with up to 2.2% corresponds to a total of around 8.2%.
The Board also proposes that the General Meeting makes a decision regarding
the consolidation of shares 10:1, a so-called reverse split. This will
facilitate changing to another listing for its shares. Starbreeze AB has
started the process of change of listing with Nasdaq OMX and appointed Remium
as the company's Certified Advisor in connection with and following the list
change.
The merger will be implemented immediately after the EGM if approved, with no
measure or expense from shareholders. Holdings that are not evenly divisible
by 10 are to be rounded up thanks to the company's main shareholders to
contribute so-called countervailing equities. Further information and
timetables will be provided in conjunction with the meeting.
"The game industry today is extremely competitive and it is important to
attract and retain skilled personnel. At Starbreeze, we have a long tradition
of developing and nurturing talent in all disciplines. An employee stock
option program is part of ensuring that we continue to retain these important
competences going forward. In the long term this will benefit Starbreeze as a
company, our employees and our shareholders.
The proposals made by the Board of Directors and the Nominating Committee has
several pieces of the puzzle fall in their place ahead of the listing change
to First North in view of the Nasdaq OMX Small Cap. The proposal to
strengthen the Board of Directors with Eva Redhe Ridderstad is an important
step in that process." Said Bo Andersson Klint, CEO, Starbreeze AB.
For more information please contact:

Bo Andersson Klint, CEO, Starbreeze AB

Tel: +46(0)8-209 208, email:ir@starbreeze.com
Brief information about Starbreeze:

Starbreeze is developing computer- and video games in-house and in partnership
with leading international game publishers. Our game portfolio consists of
ten full titles and numerous DLC packs, where PAYDAY 2 and Brothers - A Tale
of Two Sons are the latest games to have been released. Starbreeze was
founded in 1998 and has approximately 7 500 shareholders.

See
www.starbreeze.com
for more information.

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This announcement is distributed by NASDAQ OMX Corporate Solutions on behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Starbreeze AB via Globenewswire

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