The board of directors for european-based appliance maker Electrolux announced that it has decided to propose that the Annual General Meeting on April 20, 2005, approves a performance-based long-term share program, substantially identical to the program approved for 2004. The program covers less than 200 senior managers and key employees.
The proposed program is based on value-creation targets for the Group that are established by the board of directors, and involves an allocation of shares if the targets have been reached or exceeded after a 3-year period. The program comprises B-shares.
Participants are permitted to sell allocated shares to cover personal income tax, but the remaining shares must be held for 2 years. The cost of the program is comparable to the cost of previous stock-option programs and share program.
Electrolux said the program is in line with its principles for remuneration based on performance, and is an integral part of the total compensation for senior managers and key employees. The board of directors said it believes that the program will benefit the company's shareholders and also facilitate recruitment and retention of competent employees.
In addition, the board has also decided to propose that the Annual General Meeting, as in previous years, authorize the board to transfer own A- and B-shares in connection with company acquisitions, during the period up until the Annual General Meeting in 2006.
Transfers may be implemented with deviation from the shareholders' preferential rights. In addition, transfers shall be made at a minimum price per share that corresponds to an amount in close connection with the price of A- or B-shares on the Stockholm Exchange at the time of the decision on the transfer. Payment for transferred shares may be made in cash, by contributions in kind, or by offsetting company debt.
The board will also propose that the Annual General Meeting authorize transfer of repurchased own B-shares. The purpose is to implement the proposed share program 2005 in a cost-efficient and flexible manner, to fulfill the obligation to deliver shares under the program, as well as to cover costs that may arise as a result of the previous employee stock-option programs for 2000-2003.
A maximum of 1,500,000 B-shares may be transferred free of charge to the participants in the proposed share program. During the period prior to the next Annual General Meeting, a maximum of 1,107,235 B-shares may be transferred on the Stockholm Exchange at current market price in order to cover future costs of the employee stock option programs for 2000-2003. These costs refer primarily to employer contributions.
to Daily News