ANNOUNCEMENT NO. 13 - 2010
18 November 2010
TORM incentive programme for employees
The Board of Directors has approved a stock option based incentive scheme (the
“Programme”) including the following content:
• The Programme is extended to approximately 45 land-based TORM employees
worldwide including the executive management, members of the management group
and certain key employees. The Board of Directors is not included in the
Programme.
• The Programme comprises stock options only and aims at incentivising the
covered employees to seek to improve the share price to the mutual benefit of
themselves and the shareholders of TORM A/S.
• Under the Programme, stock options can be granted in 2010, 2011 and 2012.
• Each year, the stock options are granted at the discretion of the Board of
Directors in accordance with criteria determined by the Board of Directors.
• The stock options vest in connection with the publication of the annual
report in the third calendar year following grant. Vested stock options may be
exercised from the vesting date until the publication of the annual report in
the sixth year from grant.
• The maximum number of share options to be granted under the Programme in the
financial year 2010 is approximately 1,000,000. Each stock option gives the
employee the right to acquire one TORM share of a nominal value of DKK 5. The
company expects that an equivalent total number of share options will be issued
in each of 2011 and 2012.
• For grants made in 2010, the exercise price is the average of the quoted
closing price of the NASDAQ OMX Copenhagen A/S over the five business days
following the publication of the third quarter report
(“delårsrapportmeddelelsen for 3. kvartal”) for 2010 plus a hurdle rate of 12%
per annum calculated from grant until the vesting date.
• For grants made in 2011 and 2012, the exercise price is determined as the sum
of the average of the quoted closing price of the NASDAQ OMX Copenhagen A/S
over the five business days following the publication of the annual report for
2010 and 2011, respectively, plus a hurdle rate of 12% per annum calculated
from grant until the vesting date.
• The Programme is subject to Danish law and includes certain adjustment
provisions and exercise conditions and other terms customary for stock option
programmes of this nature.
• The market value of the 2010 allocation under this Programme based on the
Black-Scholes model is calculated at USD 2.2m. The key assumptions for the
calculation of the market value are:
• The exercise price is adjusted for TORM dividends
• The volatility of the TORM share was estimated at 54%
• The risk free interest rate based upon expiry of the options was 1.7%
• A share price of DKK 35 per share at the time of allocation
• The options are on average held for a period of 4.5 years
Kontakt:
N. E. Nielsen, Chairman of the Board +45 72 27 00 00
About TORM
TORM is one of the world's leading carriers of refined oil products as well as
a significant player in the dry bulk market. The Company runs a fleet of
approximately 140 modern vessels in cooperation with other respected shipping
companies sharing 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 NASDAQ OMX
Copenhagen (ticker: TORM) and on NASDAQ in New York (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.
