5 September 2007
Announcement No. 20/2007
To the Copenhagen Stock Exchange
Topdanmark convenes an Extraordinary General Meeting to be held on Monday 17
September 2007, 13:00 (CET), at the Company's head office, Borupvang 4, 2750
Ballerup, Denmark
The Board of Directors will submit the following:
I. Proposals submitted by the Board of Directors:
A. PROPOSAL FOR REDUCTION IN SHARE CAPITAL
The Board of Directors proposes that the share capital be reduced by 820,900 of
own shares with a total nominal value of DKK 8,209,000. Subsequently the shares
will be cancelled.
Pursuant to Section 44(2), cf. Section 44a(1) of the Danish Companies Act, the
purpose of the reduction in share capital is to pay the amount to the Company
as the owner of the shares by transferring the amount from the Company's
tied-up capital to its free reserves. The value of the reduction in share
capital will be DKK 9,831.6889 per DKK 100 share (equivalent to a listed price
of DKK 983.17 per DKK 10 share). Thus DKK 807,083,342 will be transferred to
the free reserves.
As a consequence of the reduction Article 3(1) of the Articles of Association
will be amended to read as follows:
"The share capital of the Company amounts to DKK 176,310,000 and is fully paid
up."
B. PROPOSAL FOR GENERAL GUIDELINES FOR PERFORMANCE-RELATED PAY
At the AGM held on 26 April 2007 the shareholders authorised the Board of
Directors to issue up to 150,000 warrants to the Company's Board of Management
and other senior executives for 2008.
It is proposed that this authorisation be cancelled and, in accordance with
Section 69b of the Danish Companies Act, replaced by the General Meeting's
adoption of the following general guidelines for performance-related pay to the
Board of Management and other senior executives:
"General guidelines for performance-related pay in Topdanmark:
1. Besides the Board of Management, these general guidelines cover members of
the Topdanmark Group's executive team, the "Friday Team", and certain other
employees at the discretion of the Board of Directors.
As Topdanmark's Board of Directors does not receive any performance-related
pay, it is not covered by the guidelines.
2. Performance-related pay comprises
• options to buy shares in Topdanmark ("call options")
• options to subscribe for shares in Topdanmark ("warrants")
• employee shares
• employee bonds
3. The share options / warrants are based on Topdanmark's holding of own shares.
4. The granting of performance-related pay to an employee is based on an
assessment of the employee's contribution to value creation in a specific year.
5. Specifically the Board of Directors is authorised to issue up to 150,000
call options or warrants to the group of people described in item 1 above for
2008 and employee bonds with a nominal value of up to DKK 3.5m to the Board of
Management and the Friday Team for 2007/2008.
The estimated value of the call options and warrants is DKK 21m as calculated
using the Black and Scholes model assuming a price of DKK 890 per share, an
interest rate corresponding to the zero coupon rate based on the swap curve on
21 August 2007, future volatility of 20%, corporate tax rate of 25% and a
pattern of exercise similar to Topdanmark's previous granting of share options
/ warrants, see IFRS 2 on share-based payments.
The value of the employee bonds will be about DKK 2.9m as calculated on the
basis of the market price of unit bonds in November 2007 and November 2008
respectively.
In accordance with Black & Scholes the value of the Board of Management's
performance-related pay will vary in step with any changes in the assumptions.
Typically the performance-related pay will represent between a quarter and a
third of the Board of Management's total pay.
6. The call options / warrants will be issued at the beginning of January 2008
entitling the holder to buy or subscribe for shares in Topdanmark at a strike
price corresponding to the market price on the last trading date in 2007 plus
10%. The call options / warrants may not be exercised any earlier than
subsequent to the publication of the first interim results announced three
years after the call options / warrants were acquired. The call options /
warrants may not be exercised any later than three banking days subsequent to
the publication of the prior year's annual report in the fifth year from the
date of acquisition of the call options / warrants. In the intervening period
the call options / warrants can only be exercised up to three banking days
subsequent to Topdanmark's publication of annual, half-yearly and quarterly
reports.
The employee bonds will be issued on 30 November 2007 and 30 November 2008
respectively. The maturity of the bonds will be five years and 33 days and they
will be fully payable on 2 January 2013 and 2 January 2014 respectively.
Following the adoption of the general guidelines, a new Article 3 F will be
added to the Articles of Association:
"The Company has prepared general guidelines for performance-related pay to the
Board of Management and other senior executives. These guidelines have been
submitted to and adopted by the Company's General Meeting. They are available
to the public on the Company's website."
The adoption of the proposal referred to in Item I.A is conditional upon the
affirmative votes of not less than two thirds of the total votes cast and not
less than two thirds of the voting capital represented at the General Meeting.
The adoption of the proposal referred to in item I.B requires a simple majority
of votes.
The votes will be based on the principle of one vote per share.
This agenda will be available for inspection by shareholders at the Company's
head office, Borupvang 4, 2750 Ballerup, Denmark.
Shareholders who want to attend the meeting should obtain admission cards no
later than 12 September 2007 by applying to Topdanmark A/S, Share
Administration Department, Borupvang 4, 2750 Ballerup, Denmark, telephone + 45
44 68 4411.
An electronic proxy form is available for downloading from the Company's
website www.topdanmark.com. Shareholders' who want to use the proxy form need
to send it to reach the Company by 12 September 2007.
In accordance with Section 73(5) of the Danish Companies Act it is reported
that the share capital of Topdanmark totals DKK 184,519,000 divided into
18,451,900 shares of DKK 10 each, corresponding to 18,451,900 voting rights.
Danske Bank is the financial institution through which shareholders may
exercise their financial rights.
Please direct any queries to:
Lars Thykier, Managing Director, Topdanmark Kapitalforvaltning
Direct tel: +45 4474 3714
