TORM Incentive Programme For Employees
COPENHAGEN, Denmark, Nov. 18, 2010 (GLOBE NEWSWIRE) -- 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 ("delaars rapport meddelelsen 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 for2010 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
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.
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