STOCKHOLM, Sweden, May 6, 2002 (PRIMEZONE) -- Shareholders of SKANDIA INSURANCE COMPANY LTD. (publ) ("the Company") are hereby summoned to an Extraordinary General Meeting on Wednesday, 29 May 2002, at 2.00 p.m. (Swedish time). Location: the Riviera Cinema, Sveavagen 52, Stockholm, Sweden.
NOTIFICATION OF ATTENDANCE, ETC.
Shareholders intending to attend the Extraordinary General Meeting, must - be recorded as shareholders in the Shareholders Register maintained by VPC AB as per Friday, 17 May 2002, and must - notify the Company of their intention to attend the Meeting not later than 4.30 p.m. (Swedish time) on Friday, 24 May 2002. Notification of intent to attend the Meeting should be made in writing to Skandia, Corporate Law, "EGM" SE-103 50 Stockholm, Sweden, by telephone Int. +46- 8-788 32 62 alt. Int. +46-8-788 30 68, fax Int. +46-8-788 16 80 or via the Internet at http://www.skandia.com/agm. Please note that if participating by proxy, power of attorney must be sent in original and may not be sent by fax or via the Internet. Shareholders whose shares are held in trust by a bank or private broker must temporarily register their shares in their own names in the Shareholders Register to be able to attend the Extraordinary General Meeting. Such registration must be completed not later than Friday, 17 May 2002. Shareholders are advised to notify the trustee well in advance of 17 May of their request to have their shares re-registered.
AGENDA AND PROPOSED DECISIONS
1. Opening of the Extraordinary General Meeting 2. Election of a Chairman to preside over the Meeting Board Recommendation: Mr. Johan Gernandt, Attorney at Law 3. Election of a person to check and sign the Minutes together with the Chairman 4. Verification of the voting list 5. Decision as to whether the Meeting has been properly called 6. Decision on the approval of the Board's proposal for a stock option programme for the Skandia group for the year 2003, and in connection with this, decision on the Board's proposal to carry out a directed issue of a promissory note with detachable warrants to subscribe for new shares in Skandia Insurance Company Ltd.
Background
At Skandia's Annual General Meeting on 17 April 2002, the Boardproposed that the Meeting decide on a stock option programme for theSkandia group for the years 2003-2005. Since the Board was notified thata majority would vote in favour of the proposal, but that it wasunlikely that the proposal would receive 90 per cent of the votes at theMeeting, the proposal was withdrawn by the Board. At the same time, theBoard was informed that shareholders that represented 95 per cent of thevotes at the Annual General Meeting on 17 April 2002 would, at anExtraordinary General Meeting, vote in favour of the proposed programme,with unchanged terms, if the programme was limited to one year (2003).
The Board's proposals:
A. Proposal for Stock Option Programme for the Skandia group 2003
Against the background above it is proposed that the ExtraordinaryGeneral Meeting decide on a group-wide incentive programme in the formof stock options for the year 2003, directed in part to essentially allemployees (programme A) and in part to key employees (programme B). Theproposed programme is in line with the programme in effect for the years2000-2002. Continuity between the two programmes will thus bemaintained. However, the volume of the programme now being proposed islesser than for the individual years in the 2000-2002 programme.Furthermore, the exercise price in the proposed programme has been sethigher than the market value of Skandia shares on the date the optionsare to be granted.
The main features of the stock option programme are as follows: Stockoptions will be granted, without charge, to the employees in line withthe Skandia group's compensation policy and as part of the employees'total compensation from Skandia. Grants will be made on one occasion -in February 2003. The price per share upon exercise of the stock options- the exercise price - will correspond to the market value of Skandiashares during the last five trading days prior to the granting date,plus 10 per cent. Decisions on grants will be made by the Board'sCompensation Committee, consisting of the Chairman and two additionalDirectors who are not employees of the Skandia group. For programme A,which in principle will include all full-time employees with at leastone year of service with the Skandia group, a total of not more than2,000,000 stock options will be granted (including a reserve for socialsecurity costs). The grants will be equal for all employees, without anycategorical breakdown. The term of the options in programme A will be amaximum of three years and three months. For programme B, which isdirected at key employees in the Skandia group, mainly in the U.S. and U.K. operations, a total of not more than 11,333,300 stock options will begranted (including a reserve for social security costs). Grants will bemade on an individual basis, based on the individual employee'sperformance and significance for the group's result and value growth,and taking into account the relevant competitive situation for suchemployees. The maximum term of the stock options will be seven years forprogramme B. In view of the individual allocation principles, no generalcategorical breakdown will be made. With exception for the group CEO, nostock options will be granted to Directors elected by the GeneralMeeting. A set of plan rules for the stock options will be decided on bythe Board.
B. Proposal for directed issue of a promissory note with detachable warrants to subscribe for new shares in Skandia Insurance Company Ltd.
It is proposed that the Company raise a loan with a nominal value ofSEK 3,000,000 through the issuance of a promissory note with 13,333,300detachable warrants for the subscription of new shares, whereby eachwarrant shall carry entitlement to subscribe for one new share with apar value of SEK 1. The warrants shall have terms running through theend of 2010. As a result of this, the Company's share capital canincrease by a maximum of SEK 13,333,300. Interest on the loan amountshall be charged at an annual interest rate of 5 per cent. The loanshall have a term up until the end of 2002. For subscription of thepromissory note with detachable warrants to subscribe for new shares,mainly the following terms shall apply: The right to subscribe for thepromissory note with detachable warrants to subscribe for new shares("the Promissory Note"), with deviation from the shareholders' pre-emption rights, shall only be given to Skandia Umbrella Trust 2000. ThePromissory Note shall be subscribed for in its nominal amount. The pricefor which new shares may be subscribed for shall correspond to theaverage price paid for Skandia shares on the Stockholm Stock Exchangeduring the five days of trading immediately following the release ofSkandia's year-end report for 2002 plus 10 per cent. The reason for thedeviation from the shareholders' pre-emption rights is as follows: Theissuance is being carried out on account of the proposed stock optionprogramme. The warrants may only be called upon to the extent necessaryto release stock options granted. It is important for the Company andits shareholders that a part of the employees' compensation is relatedto the price development of Skandia shares.
The Board proposes that a decision by the Extraordinary GeneralMeeting on this matter shall require a qualified majority pursuant to #3 of the Swedish Act (1987:464) on Certain Directed Issues in StockMarket Companies, etc.
More detailed information on the proposal for the stock optionprogramme is expected to be kept available from Monday, 6 May 2002, onSkandia's website http://www.skandia.com/agm, and is thereafteravailable to shareholders upon request from Skandia, Corporate Law, SE-103 50 Stockholm, Sweden, telephone Int. +46-8-788 32 62 alt. Int. +46-8-788 30 68, or fax Int. +46-8-788 16 80.
The Board's complete proposal on the issuance of a promissory notewith detachable warrants to subscribe for new shares on account of theproposed stock option programme, as well as other documentation inaccordance with Chapter 5, Section 4, compared with Chapter 4, Section7, of the Swedish Insurance Business Act (SFS 1982:713), will beavailable as from Wednesday, 22 May 2002, at the head offices of SkandiaInsurance Company Ltd., Sveavagen 44, Stockholm, Sweden. These documentswill also be sent to shareholders upon request to Skandia, CorporateLaw, SE-103 50 Stockholm, Sweden, telephone Int. +46-8-788 32 62 alt.Int. +46-8-788 30 68, or fax Int. +46-8-788 16 80.
7. Adjournment of the Extraordinary General Meeting
SWEDISH-SPEAKING SHAREHOLDERS
This summons to attend an Extraordinary General Meeting of Skandia Insurance Company Ltd (publ), to be held on Wednesday, 29 May 2002, at 2.00 p.m. (Swedish time) at the Riviera Cinema, Sveavagen 52, Stockholm, Sweden, can also be obtained in Swedish. Please contact Skandia, Corporate Law, SE-103 50 Stockholm, Sweden, by telephone Int. +46-8-788 32 62 alt. Int. +46-8-788 30 68, or fax Int. +46-8-788 16 80.
A welcome is extended to the shareholders to attend the Extraordinary General Meeting. Stockholm, April 2002 The Board of Directors
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