Share incentive scheme for senior executives in Bong

The Board of Directors of the listed envelope manufacturer Bong-Ljungdahl AB (publ) has decided to propose to the Annual General Meeting on 10 May 2005 an issue of debt instruments with detachable warrants for subscription to shares with exclusion of pre-emptive shareholder rights. Upon full exercise and full subscription of the warrants, the proposal will have a dilution effect of 2.3 per cent. The issue will be directed to senior executives in the Group.

In short, the proposal calls for a directed issue of debt instruments in three series (A-C) containing a total of 300,000 warrants, each of which grants the right to subscribe for 1 new share in Bong. The debt instruments will carry no interest, and will be subscribed and paid up by 30 June 2005 at the latest. The warrants may be exercised for subscription to shares in Bong Ljungdahl AB during the periods 1 July 2007-30 June 2008 (series A), 1 July 2008-30 June 2009 (series B) and 1 July 2008-30 June 2010 (series C). The exercise prices will be SEK 53 (series A), SEK 63 (series B) and SEK 73 (series C).

The motive for exclusion of pre-emptive shareholder rights is a desire to implement an incentive scheme for senior executives in the Group whereby they can be offered the opportunity to benefit from value growth for the company’s share. This can be expected to strengthen their interest in the company’s development.

The warrants will be awarded at market value on the date of transfer, with market value determined by an independent valuation institute according to a generally accepted valuation model (Black & Scholes). The allocation of warrants will be determined by the Board, with a maximum of 50,000 warrants per person.

Together with previously issued convertibles, the full exercise of this programme will have a combined dilution effect of approximately 4.7%.

A more detailed description of the Board’s proposal is provided in the notice of Annual General Meeting. This can be viewed on the company’s website www.bongljungdahl.se

For addition information contact
Mikael Ekdahl, Board Chairman, mobile +46 (0)709-777 203 (mek@msa.se)
Anders Davidsson, Managing Director and CEO, telephone +46 (0)44 20 70 00,
mobile +46 (0)705 45 70 80

Bong is one of Europe’s leading envelope companies. The Group has an annual turnover of approximately SEK 1.8 billion, some 1,400 employees and an annual manufacturing capacity of around 15 billion envelopes at its factories in Sweden, Denmark, Norway, Finland, Poland, Germany, Belgium, the UK and Ireland.
Bong has a very strong market position, particularly in Northern Europe, and conducts sales and marketing in eleven European countries through its own sales organisations. The Group sees attractive opportunities for further expansion and development. Bong is a publicly listed company and its shares are quoted on the O list of the Stockholm Stock Exchange.

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