ANNOUNCEMENT NO. 7 - 2008
9 April 2008
Complete proposals for the Annual General Meeting of Directors and Shareholders
2008
Enclosed please find the complete proposals including schedules for the Annual
General Meeting of Directors and Shareholders 2008 of A/S Dampskibsselskabet
TORM to be held on 22 April 2008.
Contact A/S Dampskibsselskabet TORM Telephone: +45 72 27 00 00
Tuborg Havnevej 18 N. E. Nielsen, Chairman of the Board
DK-2900 Hellerup
Denmark
About TORM TORM is one of the world's leading carriers of refined oil products
as well as being a significant participant in the dry bulk market. The Company
operates a combined fleet of 128 modern vessels, principally through a pooling
cooperation with other respected shipping companies who share TORM's commitment
to safety, environmental responsibility and customer service.
TORM was founded in 1889. The Company conducts business worldwide and is
headquartered in Copenhagen, Denmark. TORM's shares are listed on the
Copenhagen Stock Exchange (ticker TORM) as well as on the NASDAQ (ticker TRMD).
For further information, please visit www.torm.com.
Safe Harbor
Forward Looking
Statements Matters discussed in this release may constitute forward-looking
statements. Forward-looking statements reflect our current views with respect
to future events and financial performance and may include statements
concerning plans, objectives, goals, strategies, future events or performance,
and underlying assumptions and other statements, which are other than
statements of historical facts. The forward-looking statements in this release
are based upon various assumptions, many of which are based, in turn, upon
further assumptions, including without limitation, Management's examination of
historical operating trends, data contained in our records and other data
available from third parties. Although TORM believes that these assumptions
were reasonable when made, because these assumptions are inherently subject
to significant uncertainties and contingencies which are difficult or
impossible to predict and are beyond our control, TORM cannot assure you that
it will achieve or accomplish these expectations, beliefs or projections.
Important factors that, in our view, could cause actual results to differ
materially from those discussed in the forward looking statements include the
strength of world economies and currencies, changes in charter hire rates and
vessel values, changes in demand for “tonne miles” of oil carried by oil
tankers, the effect of changes in OPEC's petroleum production levels and
worldwide oil consumption and storage, changes in demand that may affect
attitudes of time charterers to scheduled and unscheduled dry-docking, changes
in TORM's operating expenses, including bunker prices, dry-docking and
insurance costs, changes in governmental rules and regulations including
requirements for double hull tankers or actions taken by regulatory
authorities, potential liability from pending or future litigation, domestic
and international political conditions, potential disruption of shipping routes
due to accidents and political events or acts by terrorists. Risks and
uncertainties are further described in reports filed by TORM with the US
Securities and Exchange Commission, including the TORM Annual Report on Form
20-F and its reports on Form 6-K.
Forward looking statements are based on management's current evaluation, and
TORM is only under obligation to update and change the listed expectations to
the extent required by law.
Annual General Meeting of Shareholders of Aktieselskabet Dampskibsselskabet
TORM, CVR No. 22 46 02 18 to be held on Tuesday, 22 April 2008 at 10:00 a.m. at
Radisson SAS Falconer, Falkoner Allé 9, 2000 Frederiksberg:
Complete Proposals
* * * * *
1. The directors' report on the activities of the Company in the past year.
The Board of Directors proposes that the oral report of the chairman of the
Board of Directors be adopted.
2. Presentation for adoption of the annual report.
3. The Board of Directors' proposal for the appropriation of profits or
provision for losses in accordance with the adopted annual report.
The Board of Directors proposes that out of the net profit of USD 791.7 million
an amount of USD 64.5 million be paid in ordinary dividends, corresponding to
DKK 4.5 per share of a nominal value of DKK 5. Of the remaining USD 727.2
million, has USD 369.3 million already in 2007 been paid out as extraordinary
dividends whereas the remaining USD 357.9 million is proposed to be carried
forward.
4. Election of members to the Board of Directors.
None of the existing board members elected by the general meeting are up for
re-election as provided in Article 11(3) of the Company's Articles of
Association.
In stock exchange announcement no. 16 of 29 June 2007 it was stated that the
Board of Directors intended to supplement the Board at the next annual general
meeting. The Board of Directors proposes an increase of the Board by two by the
election of:
a) Bo Jagd, and
b) Einar Michael Steimler
For information on the directorships of the proposed candidates, please see the
attached Schedule 1.
5. Appointment of auditor/auditors.
The Board of Directors proposes the re-election of Deloitte Statsautoriseret
Revisionsaktieselskab.
6. Proposals from the Board of Directors:
a. That the authorisation to increase the share capital, cf. Article 2(3) of
the Articles of Association, be prolonged from 1 April 2012 to 1 April 2013.
The proposal implies that in Article 2(3) of the Articles of Association”1
April 2012” is replaced by ”1 April 2013”.
The proposal is, like in previous years, motivated by a wish for maintaining
the extent of the authorisation as regards duration compared to the
circumstances prevailing when the authorisation was adopted at the
extraordinary general meeting of the Company on 13 March 2002.
b. That the overall guidelines for the Company's incentive schemes to members
of the management be adopted.
Proposal by the Board of Directors to adopt the overall guidelines for the
Company's incentive schemes to members of the Board of Directors and Management
Board attached as Schedule 2.
If adopted by the general meeting, a new Article 12.7 will be inserted in the
Articles of Association which will read as follows:
“At the Company's annual general meeting held on 22 April 2008, the general
meeting adopted the overall guidelines for the Company's incentive schemes to
members of the Board of Directors and Management Board, cf. Section 69b of the
Danish Companies Act. The guidelines are available at the Company's website
www.torm.com.“
c. That the Board of Directors be authorised to let the Company acquire its own
shares in the period until the next annual general meeting within 10 per cent
of the issued share capital at the market price prevailing at the time of
acquisition subject to a deviation of up to 10 per cent.
d. That the board of directors be authorised to apply for registration of the
resolutions passed and to make any such amendments thereto as may be required
or requested by the Danish Commerce and Companies Agency, the Danish Financial
Supervisory Authority, OMX Nordic Exchange Copenhagen or any other public
authority as a condition for registration or approval.
7. Any other business.
* * * * *
The general meeting is only legally competent to transact business when at
least one-third of the share capital is represented, cf. Article 9(1) of the
Articles of Association of the Company.
Approval of the proposals under items 2 - 5 and items 6 b-d is subject to a
simple majority of votes, cf. Article 9(2) of the Articles of Association of
the Company.
Approval of the proposal under item 6 a is subject to at least two-thirds of
the votes cast as well as of the voting share capital represented at the
general meeting voting in favour of the proposal, cf. Article 9(3) of the
Articles of Association and Section 78 of the Danish Companies Act.
* * * * *
SCHEDULE 1
Proposed new candidates for the board of directors
Bo Jagd, born in 1943
• Managing Director, CEO, Danish Ship Finance A/S
• Previous appointments: Aktieselskabet Kjøbenhavns HandelsBank (1959-77).
Associate Director of Nordic Bank PLC, London (1977-80). General Manager of
Nordic Bank PLC, Singapore (1980-83). Deputy Director of Aktieselskabet
Kjøbenhavns HandelsBank (1983-87). Bank Executive of Aktieselskabet Kjøbenhavns
HandelsBank (1987-90). General Manager of Den Danske Bank, London (1990-92).
Managing Director of Danmarks Skibskreditfond 1992-2005.
• Educational background: Diploma (Economics and Financial Planning),
Copenhagen Business School (1973), AMP, INSEAD, Fontainebleau (1986).
Einar Michael Steimler, born in 1948
• Chairman / Consultant to Tankers (UK) Agencies, London
• Previous appointments: Shipbroker Inge Steensland AS, Oslo (1973-74),
Shipbroker Fretheim Quincannon NY (1974-77), Shipbroker Inge Steensland AS
(1977-84), Chairman and co founder Stemoco Shipping, Oslo (1984-94), Director
and member of the board LorentzenStemoco Shipping, Oslo (1994-97), CEO Euronav
(1998-99), CEO Tankers International (2000-08).
• Education: Norwegian School of Business (BI) (Siv øk) 1973.
SCHEDULE 2
OVERORDNEDE RETNINGSLINJER FOR A/S DAMPSKIBSSELSKABET TORM'S
INCITAMENTSAFLØNNING AF SELSKABETS BESTYRELSE OG DIREKTION OVERALL GUIDELINES
FOR A/S DAMPSKIBSSELSKABET TORM'S INCENTIVE SCHEMES FOR MEMBERS OF THE BOARD OF
DIRECTORS AND MANAGEMENT BOARD
1. Baggrund 1. Background
Som led i den danske regerings ønske om større åbenhed omkring børsnoterede
virksomheders incitamentsaflønning af bestyrelses- og direktionsmedlemmer er
der i aktieselskabsloven indsat en bestemmelse i § 69b. Bestemmelsen trådte i
kraft den 1. juli 2007. The Danish Government's wish to greater transparency
with regard to the incentive schemes of Danish listed companies for members of
the board of directors and management board has resulted in the incorporation
of a provision into s. 69b of the Danish Public Companies Act. The provision
became effective on 1 July 2007.
I henhold til aktieselskabslovens § 69b skal bestyrelsen i et børsnoteret
selskab, inden der fremover indgås en konkret aftale om incitamentsaflønning
med et medlem af selskabets bestyrelse eller direktion, have fastsat
overordnede retningslinjer herfor. Retningslinjerne skal være behandlet og
godkendt på selskabets generalforsamling. Before any agreement is made for the
incentive remuneration of a member of the board of directors or management
board, the board of directors of a listed company is required under s. 69b of
the Danish Public Companies Act to prepare overall guidelines for such
incentive remuneration. The guidelines must have been considered and approved
by the company in general meeting.
Formålet med disse retningslinjer (”Retningslinjerne”) er at give TORMs
aktionærer en overordnet beskrivelse af formålet med TORMs brug af
incitaments-aflønning samt indsigt i, hvorledes incitamentsprogrammerne
overordnet set administreres af TORMs bestyrelse. The purpose of these
guidelines (the ”Guide-lines”) is to give the shareholders of TORM an overall
description of the main purpose of TORM's use of incentive remuneration as well
as to provide insight into how incentive schemes are administered at an overall
level by the board of directors of TORM.
2. Eksisterende aftaler om incitamentsaflønning 2. Existing incentive schemes
TORM (”Selskabet”) har før aktieselskabslovens § 69b's ikrafttræden i 2007
indgået aftaler om incitamentsaflønning med Selskabets direktion,
nøglemedarbejdere og øvrige medarbejdere ansat i TORM. Disse aftaler omfatter
aktieoptioner, betingede aktier og kontant bonus. Prior to the coming into
force of s. 69b of the Danish Public Companies Act, TORM (the ”Company”)
offered incentive schemes to members of the Company's management board, key
personnel and other TORM employees. These schemes include share options,
restricted shares and cash bonus.
Aktieoptionsdelen af det etablerede incitamentsprogram for alle medarbejdere,
inklusiv direktionen, som løber i 2007, 2008 og 2009, vil maksimalt kunne
udgøre ca. 5 % af Selskabets nominelle aktiekapital. The share option part of
the incentive schemes already existing for all employees, including the
management board, and which runs in 2007, 2008 and 2009, will be subject to a
maximum of approx. 5% of the Company's nominal share capital.
Disse aftaler fortsætter uændret på de vilkår, der allerede er aftalt.
Aftalerne kan kun ændres eller forlænges, og nye aftaler kun indgås, hvis det
sker inden for rammerne af de overordnede retningslinjer for
incitamentsaflønning, som Selskabets generalforsamling måtte have behandlet og
godkendt. These schemes will continue in their present form on the terms
already agreed. Any amendment or renewal of existing schemes or the offering of
new schemes is subject to compliance with the overall guidelines for incentive
schemes as considered and approved by the Company in general meeting.
Der er ingen eksisterende incitamentsaflønningsaftaler mellem TORM og
Selskabets bestyrelse. No incentive schemes have been offered by TORM to the
members of the board of directors.
3. Generelle principper 3. General principles
Formålet med incitamentsaflønning er overordnet at fremme værdiskabelsen i
Selskabet ved en realisering af TORMs strategiske mål på kortere og længere
sigt samt at sikre fælles interesser mellem Selskabets medarbejdere og
aktionærer. Incitamentsaflønningen skal desuden medvirke til at sikre, at
direktionens og medarbejdernes samlede vederlag for indsats i og for Selskabet
er markedskonformt ikke blot i forhold til øvrige industrigrupper men særligt i
forhold til den globale shipping industri. The overall purpose of offering
incentive schemes is to promote value-creation within the Company by
implementing its short-term as well as long-term strategic goals and to create
common interests between the Company's employees and shareholders. The purpose
of the incentive schemes is furthermore to ensure that the combined
remuneration to members of the management and employees for work performed in
and for the Company is market conforming not only in comparison to other
industry groups but especially in comparison to the global shipping industry.
Herudover skal incitamentsaflønningen sikre, at det selv i en cyklisk industri
og i et volatilt marked er muligt at opnå et incitament ved at outperforme
markedet. The purpose of incentive schemes is moreover to ensure that - even
in a cyclic industry and in a volatile market - an incentive may be created by
outperforming the market.
TORM har fokus på ROIC (return on invested capital), som blandt andet er et af
målepunkterne i Selskabets mere langsigtede planlægning. Hvert år fastsættes
ROIC-målet for det kommende år, og opfyldelse heraf er væsentligt for
udbetaling af kontant bonus og udstedelse af betingede aktier. One of the
measuring points in TORM's long-term planning is the so-called ROIC (return on
invested capital). The ROIC target for the following year is fixed annually and
the payment of cash bonus and issuance of restricted shares will be determined
by the Company's performance against the ROIC target.
Bestyrelsen har nedsat en vederlagskomite, som blandt andet skal gennemgå og
fastlægge vederlagspolitikken for TORM samt fastlægge det enkelte års
bonusniveau. The board of directors has set up a remuneration committee which
for instance is to review and determine the remuneration policy for TORM and to
determine the bonus level of the individual year.
Skematisk kan Selskabets eksisterende og rammerne for fremtidige aftaler om
incitamentsaflønning gengives således: The Company's existing incentive
schemes and the framework for any future schemes may be outlined as follows:
4. Det samlede vederlag 4. The combined remuneration
Bestyrelsens samlede vederlag kan udelukkende bestå af et fast vederlag
(honorar) som ikke er incitamentsbaseret, og som derfor ikke er omfattet af
disse Retningslinjer. The combined remuneration of members of the board of
directors may exclusively be in the form of a fixed fee (remuneration) which is
not incentive based and which is thus not covered by these Guidelines.1
Direktionens samlede vederlag kan bestå af et fast vederlag (grundløn) og en
incita-mentsbaseret aflønning i form af kontant bonus (pkt. 5) og betingede
aktier (pkt. 6). Dertil kommer mulighed for deltagelse i et flerårigt
aktieoptionsprogram (pkt. 7). Derud-over vil direktionen kunne deltage i
generelle medarbejderaktie- eller optionsordninger. The combined remuneration
of members of the management board may be in the form of a fixed payment (basic
pay) and an incentive-based pay in the form of a cash bonus (section 5) and
restricted shares (section 6) in addition to the eligibility to participate in
a multiannual share option programme (section 7). In addition, members of the
management board are eligible for participating in general employee share or
option schemes.
Værdien af direktionens årlige incitamentsbaserede aflønning (kontantbonus og
betingede aktier) kan maksimalt udgøre 200 % af direktionens samlede årlige
faste vederlag (grundløn). Herudover vil der i enkeltstående tilfælde kunne
ydes en bonus på op til 100 % af årslønnen for varetagelse af helt særlige
indsatsområder.
The combined value of the annual incentive-based remuneration to members of
the management board (cash bonus and restricted shares) is subject to a maximum
of 200% of the combined annual fixed remuneration (basic pay) of the management
board. In addition, a bonus of up to 100% of the annual salary may in
exceptional cases be paid for work performed in connection with special focus
areas.
Antallet af aktieoptioner, der årligt tildeles direktionen under det
eksisterende program, er beregnet med udgangspunkt i det faste vederlag for
2007 og børskursen pr 5. marts 2007. Den maksimale tildeling skal ligge
indenfor maksimum angivet i punkt 2 ovenfor. The maximum number of share
options granted under the existing programme each year to the members of the
management board is determined on the basis of the fixed remuneration for 2007
and the market price as at 5 March 2007. The maximum number of share options
granted shall be subject to the maximum stated in section 2 above.
5. Ikke-aktiebaserede instrumenter 5. Non-share-based instruments
Direktionen kan årligt tildeles en bonus, hvoraf en del er afhængig af
Selskabets opfyldelse af forud fastlagte økonomiske mål (ROIC), mens den
resterende del er en bonus, som bestyrelsen fastsætter diskretionært efter
indstilling fra Selskabets vederlagskomite. The management board is eligible
for an annual bonus, part of which is linked to the Company's performance
against pre-determined economic goals (ROIC), whereas the remaining part is a
bonus fixed by the board of directors in its own discretion at the
recommendation of the Company's remuneration committee.
Af den samlede årlige bonus udbetales 75 % som en kontant bonus, mens 25 %
tildeles i form af betingede aktier, jf. pkt. 6. 75% of total annual bonus is
paid as a cash bonus whereas 25% is paid in the form of restricted shares, see
section 6 below.
Kontant bonus udbetales i forbindelse med godkendelse af Selskabets årsrapport
for det forudgående regnskabsår. Cash bonus is paid in connection with the
adoption of the Company's annual report for the year ended.
6. Betingede aktier 6. Restricted shares
Af direktionens samlede årlige bonus, jf. pkt. 5 tildeles 25 % i form af
betingede aktier. Tildeling sker uden vederlag. 25% of total annual bonus to
the management board, see section 5 above, is paid as restricted shares without
the payment of any consideration.
Betingede aktier tildeles ved offentliggørelsen af Selskabets årsrapport for
det forudgående regnskabsår. Betingede aktier værdiansættes med udgangspunkt i
børskursen på tidspunktet for offentliggørelse af årsrapporten, justeret for at
aktien indtil frigivelse ikke har tilknyttet de økonomiske rettigheder, der
normalt er forbundet med en aktie. Restricted shares are granted on
publication of the Company's annual report for the year ended. The value of
restricted shares is determined on the basis of the market price at the time of
publication of the annual report, adjusted for the fact that until their
release, the economic rights normally attaching to shares are not attaching to
these shares.
To år efter tidspunktet for tildelingen af betingede aktier modtager
erhververen automatisk én aktie à DKK 5 i Selskabet i stedet for hver betingede
aktie. Two years after the date of grant of restricted shares, the grantee
will automatically receive one share of DKK 5 in the Company in return for each
restricted share.
Dagsværdien på tildelingstidspunktet af betingede aktier rapporteres som en del
af Selskabets årsrapport.
De aktier, som tildeles, vil være dækket af selskabets beholdning af egne
aktier. The present value of the restricted shares as of the time of the
granting is reported as a part of the Company's annual report.
The shares being granted will be covered by the Company's holding of treasury
shares.
7. Aktieoptioner 7. Share options
Direktionen kan årligt i forbindelse med offentliggørelsen af Selskabets
årsrapport for det forudgående regnskabsår tildeles aktieoptioner indenfor det
i punkt 2 angivne maksimum. Tildeling af aktieoptioner sker uden vederlag. In
connection with the publication of the Company's annual report for the year
ended, the management board is eligible for the granting of share options
subject to the maximum stated in section 2 above and without the payment of any
consideration.
Den ene halvdel af aktieoptionerne har en udnyttelseskurs svarende til
markedskursen for den første tildeling (for 2007 var kursen 151,5) med et
tillæg for hver efterfølgende tildeling.
Den anden halvdel af aktieoptionerne har en udnyttelseskurs, der fastsættes med
udgangspunkt i udviklingen i aktieindekset for en forud defineret gruppe af
sammenlignelige selskaber (tildelingen i 2007 var baseret på kurserne pr. den
5. marts 2007). Half of the share options have an exercise price corresponding
to the market price at first grant (the price for 2007 was 151.5) with a
mark-up for each subsequent grant.
The other half of the share options have an exercise price which is determined
on the basis of changes in the share index for a predefined group of comparable
companies (the grant in 2007 was based on prices as at 5 March 2007).
Hver aktieoption giver ret til at købe én aktie à 5 DKK i Selskabet. Each
share option entitles the holder to buy one share of DKK 5 in the Company.
Aktieoptionerne kan udnyttes i en periode, der begynder ved udløbet af 7 dage
efter offentliggørelsen af den årsregnskabsmeddelelse, der offentliggøres i det
tredje kalenderår, som følger efter tildelingstidspunktet (modningstidspunktet)
og slutter ved udgangen af det sjette kalenderår, som følger efter
tildelingstidspunktet. I udnyttelsesperioden kan aktieoptionerne kun udnyttes i
perioder på 28 dage efter Selskabets offentliggørelse af hel- eller
delårsrapporter (i første periode dog tidligst fra modningstidspunktet). The
share options may be exercised in the exercise window starting at expiry of a
seven-day period after publication of the preliminary announcement of financial
statements published in the third calendar year after the date of grant (the
vesting date) and ending at the end of the sixth calendar year after the date
of grant. During the exercise window, the share options may only be exercised
within windows of 28 days after the Company's publication of annual reports or
interim financial reports (however, in the first exercise window no earlier
than as from the vesting date).
Uudnyttede aktieoptioner bortfalder automatisk efter udløbet af
udnyttelsesperioden. Unexercised share options will lapse automatically after
expiry of the exercise window.
Dagsværdien af aktieoptionerne rapporteres som en del af Selskabets årsrapport.
De aktieoptioner, som tildeles, vil være dækket af selskabets beholdning af
egne aktier. The present value of the share options as of the time of the
granting is reported as a part of the Company's annual report.
The shares being granted will be covered by the Company's holding of treasury
shares.
Optionerne værdiansættes med udgangspunkt i Black-Scholes og Monte-Carlo
simulationer og med basis i følgende forudsætninger:
• Børskurs på tildelingstidspunkt
• Udnyttelseskurs
• Forventet udbytte
• Volatilitet i Torms aktier og i peer-gruppens aktier
• Korrelation mellem udviklingen i Torm aktien og peer-gruppens aktier
• Den risikofrie rente
• Optionernes forventede udnyttelses-tidspunkt The value of the options will
be calculated using Black-Scholes and Monte Carlo simulations and on the basis
of the following factors:
• The market price on the date of grant
• The exercise price
• Expected dividends
• The volatility of TORM's shares and of the shares of the peer group
• The correlation between developments in the TORM share and the shares of the
peer group
• The risk-free interest rate
• The expected time of exercise of the options
Godkendt på Selskabets ordinære generalforsamling den 22. april 2008 As
approved at the general meeting of the Company held on 22 April 2008
___________________________¬
Dirigent ___________________________¬
Chairman of the meeting
Disse overordnede retningslinjer er udarbejdet i denne to-sprogede version. I
tilfælde af uoverensstemmelser mellem den dansksprogede og den engelsksprogede
version, vil den danske være gældende.
These overall guidelines are prepared in this bilingual version. In the event
of inconsistencies between the Danish original and the English translation, the
Danish original shall prevail.
