NKT Holding issues share warrants

5 January 2009Release No.1In accordance with Article 3 B of the Articles of Association of NKT HoldingA/S the Board of Directors has exercised its authorisation to issue 200,000share warrants to the Board of Management and employees of NKT Holding A/S.This takes place in accordance with the remuneration policy approved by theAnnual General Meeting in April 2008. Recipients, exercise periods and subscription priceThe warrants have been issued to a total of 27 persons at NKT Holding A/S:144,400 to the Group Management (3 persons), 30,600 to senior executives (6persons) and 25,000 to other employees (18 persons). Warrants and options willnot be issued to members of the Board of Directors of NKT Holding A/S. The warrants can be exercised during a two-week period following publication ofthe annual financial statements in the years 2012, 2013 and 2014, respectively. Each warrant conveys the right to subscribe for one share of nominally 20 DKKat a price that is based on the average NKT share price for December 2008, plusan annual hurdle rate of 8% - corresponding to the internal WACC (WeightedAverage Cost of Capital) - and minus dividends paid to the shareholders untilthe time of exercise. Accordingly the subscription price per share of nominally20 DKK before deduction of dividends shall be 154.58 DKK, 166.95 DKK and 180.30DKK, respectively, depending on whether exercise takes place in 2012, 2013 or2014. PurposeThe purpose of the allocation of warrants is to create a link between theefforts of employees and management and the company's long-term value creation. ConditionsThe principal condition for exercise of the warrants is that the warrantholderhas not terminated his/her employment with the company prior to 1 January 2012.If the warrantholder is given notice of employment termination by the companyfor any reason except misconduct, the warrantholder shall be entitled to retainand exercise his/her warrants. If possible, the warrants will be taxable according to Section 7 H of theDanish Tax Assessment Act. The terms governing the warrants are further described in the enclosure, whichcontains the full text of the amendments made to the company's Articles ofAssociation by virtue of the warrant allocation. Market valueAs described above, the exercise price for the warrants is based on the averageNKT share price for December 2008 (calculated as 122,71 DKK) plus an annualhurdle rate of 8% and minus yearly dividends until the time of exercise. Based on a price per share of 122,71 DKK and a dividend policy equal to anannual distribution of dividends in the level of 1/3 of the year's netresult.the value of the new warrants is calculated using the Black-Scholesformula as 5.4 mDKK assuming that the share warrants are exercised at theearliest possible time. The calculation assumes volatility of 40% and aninterest rate of 5% per annum. The value of the warrants constitutes an average of 19% of the annual salaryexpenditure relating to the persons allocated warrants.  Further informationPlease address questions regarding the above to the undersigned on telephone+45 43 48 20 00. Yours faithfullyNKT Holding A/SThomas Hofman-BangPresident and CEO Enclosure:  Amendments to the Articles and Association in connection with theissuance of Warrants in 2009 ---------------Enclosure to Stock Exchange Release No. 1 of 5 January 2009 Amendments to the Articles and Association in connection with the issuance ofWarrants in 2009 The decision of the Board of Directors containing the conditions forsubscription and exercise of warrants has been added to the articles ofassociation of the company as a new article 3 B VII and as new Exhibit H withreference to the existing article 3 B. Article 3 B VII has the following wording: “In accordance with article 3.B.3 the Board of Directors of NKT Holding A/S hasin January 2009 decided to issue warrants to the employees of the Company witha right to subscribe for up to nominally DKK 4.000.000 shares in the Company.No separate payment shall be effected for the warrants. In accordance witharticle 3.B.3 the Board of Directors has also passed a resolution regarding therelated capital increase. The General Meeting's authorisation of April 10, 2008stated in article 3.B.3 is hereby reduced to nominally DKK 6.000.000. The termsand conditions for exercise of the warrants are stated in Exhibit H to thearticles of association.” Exhibit H has the following wording:“With reference to the articles of association art. 3 B sec. 3 and 3 B VII theboard of directors has in January 2009 decided to issue warrants to theemployees of the company on the following terms and conditions: The warrants may be wholly or partly exercised to subscribe for shares twoweeks after the publication of the company's statement of annual accountsduring each of the years 2012, 2013 and 2014 (hereinafter referred to as "theperiod of exercise"). This means that the warrants may be exercised for thefirst time for the subscription of shares in 2012 in the period from thepublication of the preliminary statement of annual accounts for 2011 and twoweeks onwards. The warrants may not be exercised for subscription of sharesoutside a period of exercise. After the expiry of the last period of exercise -i.e. in 2014, two weeks after the publication of the statement of annualaccounts for 2013 - non-exercised warrants shall automatically lapse withoutnotice and without compensation. The period of exercise may be changed solelyby the Board of Directors, if required, in order to observe stock exchangerules, including prohibition against insider trading, in force at the time ofexercise. The warrants only entitle the holder to subscribe for shares in onetransaction. Partial exercise of a warrant for subscription of shares shalltherefore result in a lapse of the remaining part of the warrant. The subscription price per share of nominally DKK 20 is set as a fixedsubscription price less any dividend approved by the general meeting of thecompany during the period from 1 January 2009 up to and including the date ofthe general meeting which is held immediately prior to the warrantholder'sexercise of the warrant and registration of the newly subscribed shares, cf.below. If newly subscribed shares convey entitlement to dividend at thecompany's general meeting during the year in which the warrant is exercised, noreduction in the subscription price shall be effected for dividend paid duringthe relevant year. The fixed subscription price per share of nominally DKK 20 is set as (i) DKK154.58 if subscription is effected in 2012, (ii) DKK 166.95 if subscription iseffected in 2013, and (iii) DKK 180.30 if subscription is effected in 2014. If,for example, a fixed yearly dividend of DKK 10 per share of nominally DKK 20 ispaid during the period up to 2014, the subscription price shall be adjustedaccordingly to DKK 130.30 in case of subscription in 2014, providedregistration of the new shares is effected prior to the company's generalmeeting in the relevant year with entitlement to dividend. The warrants are further subject to the terms and conditions set out in ExhibitA, although the date mentioned under section 2 shall be 1 January 2012.” *****Article 3 B together with the amendments stated in Article 3 B VII and exhibitH can be summarized as follows: 1.	1.1.	The new shares which may be subscribed in accordance with the warrantsshall belong to the same class of shares as the existing shares and shall inall respects be subject to the same conditions as the existing shares. Theshares shall carry a right to dividend from the time of registration of the newsubscription with the Danish Commerce and Companies Agency. 1.2.	The holder of a warrant shall exercise a warrant by written notificationto the company's office within a period of exercise. The company shall confirmreceipt of the notification to the holder of the warrant. Payment shall beeffected in cash to the company simultaneously with entry on the subscriptionlist and within 14 days after the company's confirmation has been forwarded tothe holder of the warrant. 1.3.	A warrant is personal and may under no circumstances become subject totransfer or assignment, nor in the case of division of an estate, and cannot becharged or in any other way serve as satisfaction of the warrant holder'screditors. 2.	2.1.	 If the warrant holder terminates his/her employment prior to 1 January2012, the warrant holder's right to exercise his/her warrant shall ceasewithout warning and compensation. However, if the warrant holder terminateshis/her employment on grounds of gross misconduct by the employer, article 2.2shall apply. 2.2.	If the warrant holder is given notice of termination before 1 January 2012by the employer, or if the warrant holder's employment terminates after 1January 2012, the warrant holder shall be entitled to retain and exercisehis/her warrant according to the conditions contained herein. However, if theemployer terminates the warrant holder's employment on grounds of grossmisconduct including cases of immediate dismissal, article 2.1 shall apply. 2.3.	If, before 1 January 2012 the warrant holder (i) retires on a pensionafter reaching the age of 60; or (ii) the general ability to work on grounds ofill-health (i.e. physical or mental invalidity) has been permanently decreasedby two thirds (2/3) or more; (iii) or the warrant holder dies, the conditionsof article 2.2 shall apply. 2.4.	The Board of Directors of the Company is at its sole discretion entitledto decide on a departure from the conditions of articles 2.1 and 2.2 in favourof the warrant holder, giving the warrant holder right to retain and exercisehis/her warrant irrespective of termination of the employment. 3.	3.1.	If one or several of the following capital changes are implemented beforethe exercise of a warrant the holder of the warrant shall receive compensationat the exercise of the relevant warrant in relation to the number of shareswhich may be subscribed in accordance with the warrant and/or the subscriptionprice for the shares so that the warrant holder, both financially and inrelation to the share interest (rounded down), is placed in the same situationas if the warrant had been exercised immediately before the implementation ofthe relevant resolution: •	Capital increase by the issue of bonus shares.•	Capital increase whereby shares may be subscribed at a price which is morethan 10 per cent lower than the market value at the time of subscription (cf.paragraph 3.3 below). •	Issue of warrants, convertible debt certificates or the like whereby sharesmay be subscribed at a price which is more than 10 per cent lower than themarket value at the time of subscription (cf. paragraph 3.3 below). Noadjustment shall be effected in connection with subsequent exercise/conversion. •	Capital reduction where payment is effected to existing shareholders ofamounts which exceed the market value of the relevant shares by more than 10per cent at the time when the capital reduction is decided. •	Capital reduction to cover loss.3.2.	The circumstances mentioned in paragraph 3.1 shall be administered by thecompany's board of directors, who shall make the final and binding decision onimplementation and calculation of any adjustment of the warrants, also inrelation to the subscription price and share interest. 3.3.	Notwithstanding paragraph 3.1 and the subscription price the followingcircumstances shall not result in adjustment: •	Issue and subsequent exercise/conversion of warrants, convertible debtcertificates or the like to board members or employees of the company or of asubsidiary. •	Capital increase by subscription of new shares, including employee shares,without a preferential right of subscription for the company's shareholders. 4.	If, before the exercise of the warrants, (i)	a resolution is passed to dissolve the company, also by merger or demergerwhere the company ceases to exist, (ii)	a resolution is passed regarding delisting of the company's shares at theCopenhagen Stock Exchange, or (iii)	if a shareholder together with the company's board of directors decidesthat the other shareholders in the company must let their shares be redeemed bythe shareholder, cf. section 20 b of the Danish Companies Act, the company must, before the implementation of such a resolution, enable theholders of warrants to exercise their warrants for subscription of new sharesin the company. The subscription price shall be fixed at the subscription priceapplicable for the closest period of exercise. The holders of the warrants arethen given a deadline by the company of four weeks within which they shallnotify the company in writing of whether the warrants will be exercised. Afterthe expiry of this period the warrants in respect of which no notification hasbeen given about exercise shall lapse automatically without notice and withoutcompensation. 5.	If, before the exercise of the warrants, a public bid is made for thecompany's shares - either voluntarily or involuntarily - whereby oneshareholder directly or indirectly acquires more than 2/3 of the company'snominal share capital the company shall enable the holders of warrants toexercise their warrants for subscription of new shares in the company. Theholders of the warrants are then given a deadline by the company of four weekswithin which they shall notify the company in writing whether the warrants willbe exercised. The subscription price shall be fixed at the subscription priceapplicable for the closest period of exercise. The holders shall be entitledbut not obliged to exercise the warrants, and warrants which are not exercisedwithin the above-mentioned period shall continue unchanged and may be exercisedfor subsequent subscription of shares within the ordinary periods of exercise.If the situations in paragraphs 4 and 5 become relevant at the same timeparagraph 4 shall take precedence. 6.	Resolutions regarding other matters of the company than the mattersmentioned in paragraphs 2-5 shall not affect the conditions for exercise of thewarrants. 5  January, 2009