NKT Holding issues share warrants
NASDAQ OMX Copenhagen
Nikolaj Plads 6
DK-1007 Copenhagen K
16 November 2011
Release No. 17
With reference to authorisation granted at the Company’s general meeting on 23 March 2011 (Article 3 B of the Articles of Association) the Board of Directors of NKT Holding A/S has decided to grant 100,000 share warrants to the management and employees of NKT Holding A/S. The issuance also takes place in accordance with the remuneration policy approved by the general meeting in March 2011.
Recipients, exercise periods and subscription price
The warrants have been issued to a total of 25 persons at NKT Holding A/S: 50,400 to the management, 29,200 to senior executives and 20,400 to other employees. Warrants and options will not be issued to the Board of Directors of NKT Holding A/S.
The warrants may be exercised during a two-week period following publication of the annual financial statements in the years 2015, 2016 and 2017, respectively and during a two-week period following publication of the half-year report in the years 2015 and 2016, respectively.
Each warrant conveys the right to subscribe for one share of nominally 20 DKK at a subscription price of 199.59 DKK that is based on the average NKT share price for the period 17 October - 11 November 2011, plus an annual hurdle rate of 8% for each of the years 2012, 2013 and 2014 - corresponding to the internal WACC (Weighted Average Cost of Capital) - and minus dividends paid to the shareholders until the time of exercise. Accordingly, the subscription price per share of nominally 20 DKK before deduction of dividends shall be 251.42 DKK.
Purpose
The purpose of the allocation of warrants is to create a link between the efforts of employees and the company's long-term value creation.
Conditions for exercise
The principal condition for exercise of the warrants is that the warrantholder has not terminated his/her employment with the company prior to 15 November 2014. If the warrantholder is given notice of employment termination by the company for any reason except misconduct, the employee shall be entitled to retain and exercise his/her warrants.
The warrants are taxable partly under Section 7H of the Danish Tax Assessment Act (up to 10% of the warrantholder's yearly salary package defined in accordance with Section 7H of the Danish Tax Assessment Act) and partly as normal taxable income. The Company’s auditors have been requested to certify that the warrants comply with the conditions therefore.
The terms governing the warrants are further described in the enclosed Exhibit I. The full text of the amendments made to the Company's Articles of Association by virtue of the warrant allocation is contained in the attached Articles of Association.
Market value
Based on a price per share of 251.42 DKK and including the expected dividend payments during the term of the warrant, the value of the allocated warrants is calculated using the Black-Scholes formula as 3 mDKK assuming that the share warrants are exercised at the earliest possible time. The calculation assumes volatility of 30% and a risk-free interest rate of 1.6%.
The value of the warrants constitutes an average of 12% of the annual salary expenditure relating to the persons allocated warrants.
Further information
Please address questions regarding the above to the undersigned on telephone +45 4348 2000.
Yours faithfully,
NKT Holding A/S,
Thomas Hofman-Bang,
President and CEO
Exhibit:
Exhibit I - Issue and grant of warrants
Exhibit II - Amendments to the Articles of Association in connection with issue and grant of warrants
________________________________________________________________________________
NKT Holding A/S is one of Denmark's major industrial groups with 9,800 employees at 30 September 2011 and a turnover in 2010 of 14.5 bnDKK. The group consists of NKT Cables (the energy sector), Nilfisk-Advance (the cleaning industry), Photonics Group (the optical industry) and the 51% owned NKT Flexibles (the offshore sector). Read more at www.nkt.dk.