Share Subscription Plan 2007
The Board of Directors of Elcoteq SE has decided to approve an incentive plan for the motivation and commitment of the company’s key personnel by means of a share subscription plan.
The potential reward from the plan is based on reaching the targets set by the Board of Directors for the Group’s consolidated income before taxes for the full year 2008. Based on the achieved targets the company would issue a maximum of 1,500,000 new series A shares of which 50% would be issued during March 2009 and the remaining 50% during November 2009.
The new series A shares, if any, will be issued under the authorization granted to the Board of Directors by the Annual General Meeting on March 22, 2007. The same meeting decided to transfer the company domicile to the Grand Duchy of Luxembourg which takes place on January 1, 2008. Therefore, it is foreseen that the issue of new series A shares due to the share subscription plan in 2009 will be carried out under Luxembourg law and in accordance with the new Articles of Association of Elcoteq SE approved at the Annual General Meeting of March 22, 2007.
Terms and Conditions of the Share Subscription Plan
Incentive plans 2004
The Board of Directors of Elcoteq Network Corporation agreed on August 3, 2004 on the motivation and commitment of the management and key personnel of the Group by means of a stock option plan, a share ownership plan and a reward plan.
Stock option plan
The Board of Directors resolved, by authorization of the Annual General Meeting of Shareholders on March 17, 2004, to issue stock options to the key personnel of the Group and to Elcoteq Lohja Oy, a wholly owned subsidiary of the Company. The total maximum number of stock options issued shall be 1,350,000, and they entitle to subscription of 1,350,000 A-shares in Elcoteq Network Corporation. The stock options now issued can be exchanged for shares constituting a maximum of 4.2% of all of the Company's shares and 1.1% of the voting rights of all shares after the potential share capital increase.
The stock options shall be divided into 2004A, 2004B and 2004C stock options (450,000 stock options in each stock option class). Upon issue, all stock options 2004A, 2004B and 2004C shall be granted to Elcoteq Lohja Oy.
The share subscription price for stock options 2004A, 2004B and 2004C, is EUR 15.30 i.e. the trade volume weighted average quotation of the Elcoteq A-share in the Helsinki Exchanges in July 2004. From the share subscription price of stock options shall, as per the dividend record date, be deducted the amount of the dividend decided after August 3, 2004 but before share subscription.
The share subscription period shall, for stock option 2004A, be March 1, 2005 - March 31, 2007, for stock option 2004B March 1, 2006 - March 31, 2008 and for stock option 2004C March 1, 2007 - March 31, 2009. The share subscription period shall not, however, commence with the stock options 2004A, unless the trade volume weighted average quotation of the Elcoteq A-share during any quarter of a year has been at least EUR 21, with the stock options 2004B, at least EUR 27 and with the stock options 2004C at least EUR 33.
Share ownership plan
In addition the Board of Directors approved a new share-based incentive plan for the Group key persons. The duration of the incentive plan is three years. In the share ownership plan the Board of Directors shall annually determine the result and turnover targets for each year.
The potential reward from the plan in 2004 will be based on the development of the Group's earnings per share and on the Group's net sales. The reward shall be paid partly in the Company's series A shares and partly in cash payment in 2005. It is prohibited to transfer the shares corresponding to the gross annual salary of a key person as long as his/her service or employment in the Group continues. The President and CEO of the Company is not allowed, without the consent of the Board of Directors, to transfer his A shares as long as he is in the service of the Company.
Reward plan
The Board of Directors also approved a new reward plan for the Group key persons. The potential reward from the plan will be based on the growth of the market value of the Company's shares. A key person belonging to the plan has a possibility to earn a maximum reward worth of 9 months gross salary. The Board of Directors can require that 40% of the earned gross reward will be used for acquiring of the Elcoteq A-shares. The reward plan is directed to key personnel outside the stock option plan and the share-based incentive plan.
Terms and conditions of the 2004 stock options
Subscription windows in 2007
The last day to sell the 2001 options was April 23, 2007. The last day to subscribe for shares with the 2001 options was April 30, 2007.
December 14, 2006 - January 26, 2007
Subscriptions made during this period don't entitle to dividends from 2006.
January 27 - March 14, 2007
March 15 - April 18, 2007
April 19 - July 19, 2007
July 20 - October 17, 2007
October 18 - December 14, 2007
Subscriptions made on December 14, 2007, at the latest, entitle to dividends from 2007.
Option program 2001
On March 14, 2001, the Annual General Meeting approved the Board's proposal to issue new stock options to key employees in Elcoteq Network Group and to a wholly owned subsidiary of Elcoteq Network Corporation on the following conditions:
- At most 2,685,000 warrants will be issued entitling their holders to subscribe for at most 2,685,000 new Series A shares
- The warrants will be issued without charge
- The warrants may be exercised to subscribe for 537,000 new Series A shares annually in five successive years commencing on April 1, 2002
- The subscription period shall, for all warrants, end on April 30, 2007
- The share subscription price for all warrants shall be the trade volume weighted average quotation of the Elcoteq Network Corporation A share on the Helsinki Exchanges between March 1 and March 31, 2001.
Terms and conditions of the option program 2001
2001 Option rights listed on the Helsinki Stock Exchange
Warrants under the stock option plan 2001 are traded on the Main List of the Helsinki Stock Exchange. The warrants are traded in lots of 50 under trading code ELQAVEW101.
The last day to sell the 2001 options is April 23, 2007. The last day to subscribe for shares with the 2001 options is April 30, 2007.
Further information on subscriptions with warrants:
Evli Bank Plc. / Operations, by telephone +358 9 4766 9931 or by e-mail management.options@evli.com