Pre-Annual General Meeting Information • Jul 26, 2007
Pre-Annual General Meeting Information
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In accordance with the listing agreement with OMX Nordic Exchange in Stockholm, B&B TOOLS (publ) hereby also announces, by issuing a press release, the contents of the notice for the Annual General Meeting of Shareholders to be held 30 August 2007.
Attachment: Notice for the 2007 Annual General Meeting of B&B TOOLS
Stockholm, 26 July 2007
B&B TOOLS AB (publ)
For further information, contact: Mats Karlqvist, Vice President – Investor Relations, B&B TOOLS AB, telephone +46-70-660 31 32
B&B TOOLS provides the industrial and construction sectors in northern Europe with tools, industrial consumables and industrial components, and related services. The Group has annual revenues of approximately SEK 7.6 billion and has approximately 2,700 employees.
Bergman & Beving changed its name to B&B TOOLS at the end of March 2007.
B&B TOOLS AB (publ)
Welcome to the 2007 Annual General Meeting!
are hereby given notice to attend the Annual General Meeting of Shareholders to be held at 4:30 p.m., Thursday, 30 August 2007, at Näringslivets Hus, Storgatan 19, Stockholm.
Shareholders who wish to participate in the proceedings of the Annual General Meeting must:
Such notice must contain the shareholder's name, personal registration number (organisation number), telephone number (daytime), registered shareholding and the name(s) of any attending counsel. Proxies and representatives of legal entities must provide documented proof of authority before the Annual General Meeting. A copy of the Power of Attorney or proxy should be submitted together with the notice to attend and must be presented in original before the start of the Annual General Meeting.
In order to exercise their voting rights at the Meeting, shareholders whose shares are registered in the name of a bank's trust department, or in the name of a stockbroker as nominee, must temporarily register their shares in their own name via their custodian. This procedure also applies to shareholders who use a bank's custody shareholder account, and to those who trade shares via the Internet. Such registration must be completed not later than by Friday, 24 August 2007.
Shareholders who wish to bring issues to be dealt with under item "Other matters" by the Annual General Meeting are welcome to contact ir@b&b.se, or to send a letter to Annual General Meeting, B&B TOOLS AB, PO Box 10024, SE-100 55 Stockholm, Sweden.
At the Annual General Meeting of Shareholders held 24 August 2006, a resolution was passed to authorise the Chairman of the Board of Directors to contact the largest shareholders by vote, requesting them to appoint members who, together with the Chairman of the Board of Directors, would constitute an election committee for future election of directors. In accordance herewith, and as reported in the Company's Interim Report published 12 February 2007, the following persons were appointed to serve as members of the Election Committee: Tom Hedelius (Chairman of the Committee), Jan Andersson (representative of Swedbank Robur Funds), Björn Franzon (representative of Fjärde AP-Fonden), Anders Börjesson and Pär Stenberg.
The Election Committee, the members of which represent 39.3 percent of the total number of votes as of 30 June 2007, has reported that it will propose to the Annual General Meeting of Shareholders to be held 30 August 2007 to resolve as follows in respect of the above matters:
The Election Committee proposes Tom Hedelius to serve as Chairman of the Meeting.
Unchanged number; five regular directors.
An aggregate director's fee of SEK 1,250,000 (last year: SEK 1,100,000) to be distributed as follows:
Chairman of the Board of Directors: SEK 450,000 (400,000) Vice Chairman of the Board of Directors: SEK 350,000 (300,000) Other directors who are not employees of the Company: SEK 225,000 (200,000) per director.
No separate compensation is paid for committee work.
As before, audit fees will be paid according to approved invoice.
Re-election of directors Per Axelsson, Anders Börjesson, Tom Hedelius, Anita Pineus and Stefan Wigren. Tom Hedelius is proposed to serve as Chairman of the Board of Directors.
A presentation of the members of the Board of Directors is to be found in the Annual Report for the 2006/2007 operating year and at the Company's website www.bb.se.
Re-election of registered audit firm KPMG Bohlins AB as auditors for the period until adjournment of the 2011 Annual General Meeting of Shareholders. KPMG Bohlins AB has announced that it intends to appoint Authorised Public Accountant George Pettersson to serve as chief auditor.
The Election Committee proposes that the assignment of the Election Committee shall include evaluation of the composition and work of the Board of Directors and to provide proposals to the Annual General Meeting in respect of:
Chairman of the Board of Directors and other directors elected by the General Meeting of Shareholders;
Director's fees distributed among the Chairman of the Board of Directors and the other directors, and any compensation for committee work;
The Election Committee proposes that, until a new election committee is appointed, the Election Committee shall consist of five members and that the Chairman of the Board of Directors has the assignment to contact the largest shareholders by vote not later than 31 January 2008, requesting them to appoint four members who, together with the Chairman of the Board of Directors, shall constitute the Election Committee. The selection of shareholders to contact shall be made based on a list of shareholders as of 31 December 2007. The Election Committee will appoint a chairman among its members. The composition of the Election Committee shall be announced not later than six months before the 2008 Annual General Meeting. Information about the composition of the Election Committee shall be held available on the Company's website www.bb.se. The Election Committee shall have the right to receive reasonable compensation from the Company for out-of pocket expenses incurred in the process of evaluation and recruitment. The members of the Election Committee receive no compensation from the Company for their work.
In the event that a member of the Election Committee resigns or is prevented from fulfilling the assignment, the remaining members shall, where the Election Committee so decides, appoint a suitable replacement to the Election Committee for the remaining mandate period. In the event that a member of the Election Committee, or the owner a member represents, has significantly reduced its ownership in the Company at the time of the Election Committee's meetings in preparation for the upcoming Annual General Meeting, the members of the Election Committee shall decide whether the composition of the Election Committee should be changed.
The Board of Directors proposes a dividend to the shareholders of SEK 4.00 per share and Tuesday, 4 September 2007 as record day for receiving dividend. Subject to the Annual General Meeting's approval of the proposal, the dividend is expected to be remitted by VPC Friday, 7 September 2007 to those whose names are entered in the share register on the record day.
The Board of Directors proposes that the Annual General Meeting passes a resolution authorising the Board of Directors – during the period until the next following Annual General Meeting – to repurchase up to the maximum number of class B shares so that the Company's holding of own shares in treasury at no time exceeds 10 percent of the total
number of shares outstanding in the Company. Purchases shall be made over the OMX Nordic Exchange in Stockholm at the current share price.
The Board of Directors further proposes that the Annual General Meeting authorises the Board of Directors – during the period until the next following Annual General Meeting – to sell its own shares held in treasury in conjunction with acquisitions of companies or businesses in ways other than over the OMX Nordic Exchange in Stockholm. The authorisation may be exercised on one or more occasions and includes any and all shares held in treasury by the Company at the time of the decision of the Board of Directors. The authorisation includes a right to decide on a departure from the preferential right of shareholders and that payment may be effected in forms other than money.
The purpose of repurchasing own shares is to provide the Board of Directors with an additional instrument to use in working with the Company's capital structure, and to enable the Company to pay for acquisitions using the Company's own shares. Holding of own shares in treasury also secures the Company's obligations under incentive programmes for members of senior management.
The proposal of the Board of Directors involves in principal that the Company will issue up to 90,000 call options on repurchased class B shares in B&B TOOLS AB to a total of approximately 50 members of senior management and key personnel in the B&B TOOLS Group in Sweden. Each call option will entitle its holder to acquire one (1) class B share in B&B TOOLS during the term of the option, which expires 30 September 2012, at a price equivalent to 110 percent of the volumeweighted average of the quoted paid prices for the B&B TOOLS share on OMX Nordic Exchange in Stockholm during the period 17 – 21 September 2007, rounded to the nearest SEK 0:50. The call options will be conveyed at a market price.
For the purpose of encouraging participation in the programme, B&B TOOLS will subsidise part of the option premium by paying a cash compensation after 2 years on the condition that the option holder still is an employee of the B&B TOOLS Group and still holds all call options purchased from B&B TOOLS under the now proposed programme.
The right to purchase options will fall to members of senior management and other key persons in the B&B TOOLS Group in Sweden. However, the President & CEO and other members of Group management in the Parent Company B&B TOOLS AB are not embraced by the programme.
The number of options each person will be offered to purchase will be determined by the Board of Directors based on an assessment of each respective person's importance for the Group's current and future development, and any prior grants under B&B TOOLS' existing sharebased incentive programmes (personnel and call options). Persons affected will be offered to purchase up to between 1,000 and 15,000 options each, with a guaranteed grant of up to 5,000 options.
The proposal of the Board of Directors also means that the Annual General Meeting resolves that the Company, in a departure from the preferential rights of shareholders, conveys up to 90,000 of the Company's repurchased class B shares held in treasury at the set redemption price in connection with any redemption of the call options (subject to any recalculation).
The reasons for departure from the shareholders' preferential rights, and the motive for the Board of Directors to introduce the call option programme, are that the Board of Directors regards the existence of competitive share-based incentive programmes as a prerequisite for retaining key persons, who through their competence and successful value-creating work efforts contribute to the Group's development. These persons represent a valuable asset for the Company and the loss of one or more persons in this category would be negative in the current market situation. In the opinion of the Board of Directors, an annually recurring incentive programme is very important in a fast-growing organisation such as B&B TOOLS. The Board of Directors deems the offer to be reasonable and advantageous for the Company as well as its shareholders.
The number of call options is equivalent to approximately 0.3 percent of the total number of shares outstanding and approximately 0.2 percent of the number of votes in B&B TOOLS AB. Since before, there are 232,500 personnel options and 250,000 call options outstanding in B&B TOOLS AB on repurchased class B shares held in treasury. The proposed programme fully granted, the option programmes in aggregate would at the time of the 2007 Annual General Meeting be equivalent to approximately 2.0 percent of the total number of shares outstanding and approximately 1.5 percent of the number of votes.
B&B TOOLS' cost for subsidising the option premium in accordance with the above terms and conditions is estimated to amount to a maximum of MSEK 3.0, including social benefit fees.
To be valid, the above resolutions require approval by shareholders representing at least nine tenths of the votes cast as well as of the shares represented at the Annual General Meeting.
Shareholders who together represent more than 66 percent of the total number of votes in B&B TOOLS AB, have declared that they are positive to the proposal of the Board of Directors as outlined above.
The Board of Directors has expressed the ambition to propose to the Annual General Meeting on an annual basis to resolve an appropriate share-based incentive programme similar to the proposal described above.
The Board of Directors strives for an award system for the President & CEO and the other four members of the Group's management team ("corporate management") that is in line with market conditions and competitive. For the purpose of creating continuity, the proposal of the Board of Directors below essentially conforms to the compensation principles applied in prior years and is based on agreements already in force between B&B TOOLS and the respective associate.
The Board of Directors proposes that the guidelines set out below for determination of compensation and other terms of employment for corporate management be adopted.
For the Board of Directors it is essential that the Company is able to recruit, to motivate on a long-term basis and to retain competent employees, who both on a short-term and a long-term basis create shareholder value. To achieve this, it is important to be able to offer competitive terms. The Company's compensation levels and compensation structures for corporate management shall be in line with market conditions. The total compensation package for the individuals in question shall be a well balanced blend of: fixed salary, variable salary, long-term incentive programmes, pension benefits and other benefits. The variable salary and the long-term incentive programmes shall be related mainly to the Group's earnings and value performance.
The fixed salary shall be adapted to market conditions and be based on responsibility, competence and performance. The fixed salary shall be reviewed on an annual basis.
The variable salary is paid as a function of the Group's earnings performance.
Since last year, corporate management is covered by a long-term incentive programme and the personnel option programme issued by the Company during 2002. Corporate management is not covered by any other share-based incentive programmes, nor by the call option programme proposed by the Board of Directors as set out above (Item 16 of the proposed agenda).
Pension benefits shall consist of either a defined benefit pension plan or a defined contribution pension plan, with the annual premium determined as a function of fixed salary, variable salary and age. Certain individual consideration can be taken. The current age of retirement for corporate management is 65 years.
Other benefits shall be in line with market conditions and shall contribute to facilitating the associates' opportunities of fulfilling assigned tasks.
A period of notice of six months applies in the case of termination at the initiative of the President & CEO or other members of senior management. A maximum period of notice of 12 months applies in the case of termination at the initiative of the Company. A severance payment can amount to a maximum of 12 monthly salaries.
The Board of Directors has, where it finds special reasons for it, the right to deviate from the above proposed guidelines in an individual case.
The financial statements, the Audit Report and the complete proposals of the Board of Directors for resolutions under items 15−17 of the agenda will be held available at the Company's offices and at the Company's website www.bb.se from Thursday, 16 August 2007 and will be sent to shareholders who so request.
Stockholm, July 2007
BOARD OF DIRECTORS
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