STOCKHOLM, Sweden, Aug. 23, 2004 (PRIMEZONE) -- With the ambition to promote key employees to participate in opportunity and risk in Elekta's performance and ensure that Elekta has a competitive compensation structure in order to recruit and retain senior managers, The Board of Directors in Elekta has decided to propose to the Annual General Meeting to launch a Share Unit Option Plan.
The proposed plan will give approx. 50 senior managers the opportunity to participate in a new personnel Share Unit Plan related to three year performance goals for profitable growth. To be granted a stock option, an eligible manager is required to acquire Elekta shares on the market upfront and retain these shares until the stock option is exercised.
Planned as a long term incentive, the plan is intended to include annual grants of stock options during three years, requiring yearly decisions at the AGM.
Each option entitles to acquisition of a certain number of shares depending on future performance, which for this year's grant shall be based on EBIT margin and business volume growth. Depending on corporate performance in relation to Elekta's financial objectives, the nominal amount of shares subject to the stock options in the 2004 grant will amount to maximum 530,000 shares (class B) at target performance and to additionally maximum 202,000 shares in case of over-performance.
Each yearly grant has stepwise vesting (i.e. become exercisable) over 3 years. In order for any shares to vest in this year's grant, Elekta must reach an EBIT margin of at least 9 percent. An additional vesting requirement is employment within the Elekta group. There is also a cap option value, maximizing the possible earning to 400 percent of the exercise price.
Delivery of shares upon exercise of stock options is proposed to be secured by issuance of warrants to subscribe for new class B shares, as described in detail in the invitation to the AGM. Since the amount of vested shares subject to the stock options is dependent on EBIT margin and business volume growth, the financial dilution is strongly dependent on the company's performance. The dilution at target performance is 1.67 percent of the total number of shares of the company for the proposed 2004 grant. Including also intended grants 2005 and 2006, the grants shall in aggregate not at any time exceed 5 percent of the total number of shares.
The necessity of an equity based incentive program should be viewed in relation to the fact that Elekta operates on a global market and that a majority of the eligible employees work in an environment where equity incentives are a normal part of the total compensation package.
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For further information, please contact:
Karin Isberg, Group VP Human Resources, Phone: +46 8 587 255 78, e-mail: karin.isberg@elekta.com
Peter Ejemyr, Group VP Corporate Communications, Phone: +46 8 587 254 99, e-mail: peter.ejemyr@elekta.com
Elekta is a world-leading supplier of advanced and innovative radiation oncology and neurosurgery solutions and services for precise treatment of cancer and brain disorders. Elekta's solutions are clinically effective, cost efficient and gentle to the patient.
For additional information about Elekta, please visit www.elekta.com
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