Struer, 05-09-2008
Annual General Meeting of Bang & Olufsen a/s
Bang & Olufsen a/s' Annual General Meeting will be
held on Friday, 26 September 2008, at 16.30 at
Struer Gymnasium, Jyllandsgade 2, Struer.
Agenda
1. Election of chairman.
2. The Board of Directors' report on the
company's activities during the past year.
3. Presentation and approval of the audited
Annual Report for the 2007/08 financial
year, including the resolution concerning
the discharge of the Management Board's
and Board of Directors' obligations and
the decision concerning the allocation
of profits in accordance with the
approved Annual Report.
4. Proposal by the Board of Directors:
The Board recommends to the
Annual General Meeting:
a. that the Board, on behalf of the
company, is authorised to acquire
- within 18 months from the date
of the Annual General Meeting -
up to 10 per cent of the company's
share capital at a price which must
not be more than 10 per cent above
or below the most recent price quoted
for the B shares (ordinary shares)
on OMX The Nordic Exchange Copenhagen.
b. that a dividend of DKK 3.00 be paid
per nominal DKK 10 share bringing the
total dividend to approx. DKK 36 million.
Last year, the dividend was DKK 20.00
per nominal share of DKK 10.00 equating
to a payment of DKK 242 million.
c. that the proposal submitted by the Board
of Directors regarding general guidelines
for performance-related remuneration
be approved.
d. that Article 9 paragraph 2 if the
Articles of Association be changed from:
"Of the section of the Board of Directors
elected at the general meeting, the 2
members longest in office shall retire
each year at the ordinary general meeting;
should more than 2 members have been in
office for the same period of time, it
shall be determined by lot who is to
retire. No member shall be elected to
hold office for a period exceeding
four years. Re-election may take place."
to
"The section of the Board of Directors
elected at the general meeting retire
each year at the ordinary general
meeting. Re-election may take place."
5. Election to the Board of Directors:
If the above proposal with regard to a change
to Article 9, paragraph 2 is approved, all
members of the Board of Direc-tors elected at
the ordinary general meeting are up for
re-election.
Preben Damgaard Nielsen does not wish to be re-elected.
The Board of Directors proposes that Jørgen Worning,
Lars Brorsen, Thorleif Krarup, Peter Skak Olufsen
and Niels Bjørn Christiansen be re-elected.
The Board of Directors also proposes that
Rolf Eriksen be elected to the Board of Directors.
6. Election of auditors:
The Board of Directors proposes that Deloitte,
Statsautoriseret Revisionsaktieselskab be re-elected.
7. Other matters.
The company's nominal share capital totals DKK 120,813,380
apportioned between A shares, (ordinary shares (multiple
voting shares)), of nominally DKK 10,855,430 and B shares
(ordinary shares) of nominally DKK 109,957,950. Each A share
amount of DKK 10.00 carries 10 votes, while each B share
of nominally DKK 10.00 carries 1 vote.
Admission cards for the Annual General Meeting can be
obtained by forwarding the enclosed form by post or fax
(no. + 45 43 58 88 67) to VP Investor Services A/S,
to be received by VP Investor Services A/S no later than
Monday, September 22, 2008, or by phoning VP Investor
Services A/S, tel.: + 45 43 58 88 66 no later than Monday,
September 22, 16:00.
Admission cards are also available from VP Investor
Services A/S' web-site: www.uk.vp.dk/agm.
If you are unable to attend, Bang & Olufsen a/s' Board of
Directors would be grateful if you would authorise the
Board to cast your vote by proxy. In this case, you are
requested to complete the proxy form, and, using the
enclosed reply envelope, ensure that it is received by
VP Investor Services A/S no later than Monday,
September 22, 2008.
Owing to the lack of parking space at Struer Gymnasium,
we can again offer coach transport to our main building
("Gården") to Struer Gymnasium and back. These coaches
are available from 15.45.
In connection with the Annual General Meeting, we would
like to offer shareholders who are not employees, a
demonstration of Bang & Olufsen's products and a
presentation of Bang & Olufsen Automotive. In addition,
we are offering the opportunity to visit the new Struer
Museum where the history of Bang & Olufsen is presented
in a separate section. Please assemble at
Bang & Olufsen's main building (Gården) at 13.30
where you will be provided with entry tickets to the
museum and transport will be organised.
If you would like to take part in the event prior
to the Annual General Meeting, please tick the
appropriate section on the form.
Yours faithfully,
Bang & Olufsen a/s
Jørgen Worning
Chairman
Appendix to Agenda item 4.c.
General Guidelines concerning performance-related
remuneration
According to Section 69b, paragraph 1 of the Danish Companies
Act, the Board of Directors - prior to specific agreements
concerning performance-related remuneration with members of
the company's Board of Directors or Management Board being
entered into - shall have drawn up general guidelines for
this. The guidelines shall be considered and approved at
the company's general meeting and information on this
must be included in the company's articles.
The Board of Directors' view is that a combination of
fixed and performance-related remuneration for the
Management Board contributes towards the company's
ability to attract and maintain competent key employees
while, at the same time, the Management Board has an
incentive to create added value for the benefit of
shareholders through part performance-related remuneration.
The aim of the general guidelines is to determine the
framework for the variable portion of the salary with
due regard for the company's short and long-term
objectives and to ensure that the type of remuneration
does not result in imprudent or unreasonable behaviour
or an acceptance of risks.
1. Individuals included
a. The Board of Directors
The Board of Directors receive a fixed fee which is
approved annually by the general meeting.
The Board of Directors, therefore, does not receive
performance-related remuneration.
b. The Management Board
The current general guidelines for performance-related
remuneration, therefore, only apply to executive
directors notified to The Danish Commerce and
Companies Agency as other groups of individuals
outside the framework of these guidelines may have
bonuses - or other performance-related remuneration
included in their respective employ-ment terms and
conditions. In accordance with the articles, the
registered Management Board must comprise at least
1 and no more than 5 members.
The Management Board's terms of employment and
payment are agreed between the individual director
and the Board of Directors and payment will normally
comprise all the elements stated in section 2 below.
The Board of Directors has set up a remuneration
committee, which assesses the Management Board's
salary conditions on an ongoing basis.
2. Remuneration elements
The total fee for individual members of the Management
Board comprises the following components:
• Fixed salary ("Gross salary"), including pension,
• The customary fringe benefits, e.g. car, telephone, newspapers etc.
• Cash bonus, c.f. point 3 below, and
• Share options, c.f. point 4 below.
3. Cash bonus
Individual members of the Management Board can
receive an annual bonus which cannot exceed 35%
of the individual's Gross Salary for the year
in question. This cash bonus is intended to
ensure compliance with the company's short-term
objectives. The payment of the bonus and its size
will, therefore, depend on the achievement of
the objectives agreed from year to year. These
primarily relate to the achievement of the
company's budgeted results or the achievement
of the financial ratios or other measurable
personal results of a financial or non-financial
nature.
4. Share options
Members of the Management Board can also be
allocated options. Such allocations are
intended to ensure value creation and the
achievement of the company's long-term
objectives. The option scheme is share based.
Allocation can take place on an annual basis.
For any single financial year, options with
a current value at the time of the allocation
of up to 25% of the individual's Gross Salary
at the allocation time can be allotted.
The current value at allocation is calculated
in accordance with the Black & Scholes method.
Normally, the options can be exercised 3 years
after the option agree-ment has been entered
into at the earliest. They usually expire if
they are not exercised 6 years after the
option agreement at the latest.
The exercise price for the options cannot be
less than the market price for the company's
shares at - or immediately prior to - the
signing of the option agreement. The share
options' exercise price is adjusted for
dividend paid.
The company will cover the allocated options
on an ongoing basis through the purchase of
own shares. Consequently, no capital increase
has to be undertaken in order to provide the
shares covered by the allocated options.
The allocation can take place on tax-related
conditions where the recipient's gains are
taxed as salary at the time of the exercise
of the option in return for the company
obtaining tax relief.
As at 31 May, 2008, current and former
members of the Management Board had
261,900 outstanding options which can be
exercised in the period from 2008 to 2013.
These had a total value of DKK 6.1 million,
c.f. Note 5 to the 2007/08 Annual Report.
