of the Board’s annual report for 2006.
of financial statements for 2006.
on dividend payments.
on remuneration payable to members of the Board.
of Board of Directors.
of certified accountants and auditors.
for a Remuneration Policy.
for amendments to the Articles of Association of FL Group:
to amend Article 8, to delete subparagraph 2 in paragraph 4, requirement to
call AGM with two weeks notice deleted, will be one week instead.
to amend Article 8, to add a paragraph on electronic participation in
shareholders meeting and electronic meetings.
to amend Article 9, to state proposal for a Remuneration Policy in the agenda
to amend Article 12, to add a paragraph regarding information in notification
of candidature for the Board of Directors.
to grant authorization to the Board to buy Company shares.
business lawfully submitted or approved for discussion at the meeting.
Proposals of the Board of Directors of FL
Group hf. to the company's Annual General Meeting on 22 February 2007.
1. Proposal of the
company's Board of Directors on the payment of dividends for 2006.
The FL Group hf. Board of Directors proposes that the Annual General
Meeting, held on February 22nd 2007, approve the payment of
dividends in the amount of 193% of the outstanding share capital (i.e. ISK 1.93
per share), which corresponds to ISK 15 billion. This is 33.7% of the company's
after-tax profit in 2006. The dividend is payable in cash, without interest, on
April 4, 2007. Dividend shall be paid to those who hold shares in the company
at the end of the day the Annual General Meeting is held. Ex-dividend date is
the day after the Annual General Meeting, February 23, 2007.
2. Proposal on
remuneration of the Board in the next business year.
The Annual General Meeting of FL Group hf., held on February 22nd
2007, agrees that the remuneration of the Board of Directors in the period from
the Annual General Meeting 2007 until the Annual General Meeting 2008 shall be
Chairman of the Board ISK 700,000 per month
Vice-Chairman ISK 500,000 per month
Other directors ISK 350,000 per month.
Reserve board members shall be paid ISK 100,000 for each meeting
Board members shall receive a fixed
fee for each meeting they attend in the Board’s subcommittees. The fee shall be
ISK 200,000 for the Chairman of the relevant committee for each meeting but ISK
100,000 for other members for each meeting attended. The fee for attending
meetings in subcommittees in the period shall however not exceed
ISK 1,200,000 for the Chairman and ISK 600,000 for other members.
3. Proposal on a Remuneration
Proposal of the Board of
Directors of FL Group on Stock Options and FL Group’s Remuneration Policy
submitted to the Annual General Meeting.
FL Group emphasis on being able to recruit
skilled personnel and hold its key personnel to secure the ongoing growth of
the company and acceptable return on equity.
In relation thereto the company has granted key
personnel stock options for shares in the company and also issued and renewed
stock options with strike price in all cases being in line with market price at
the time of grant of the relevant stock option.
In relation to the practice of the aforementioned goal
of the company stock options granted to key personnel may at any time in total
be up to 9% of the company’s outstanding share capital. Purchase price (strike
price) shall equal market price at the time when the option is granted.
FL Group’s Remuneration Policy is
based on good practice of corporate governance and the company’s goals on
growth and return on equity. The Board of FL Group has agreed upon the
following Remuneration Policy with reference to Article 79. a in Act No. 2/1995, on Public Limited Liability Companies.
Members of the Board shall receive a fixed fee for
their duties as Directors. The fee for both general duties as Directors and as
members of the Boards’ subcommittees shall be decided upon by the company’s
Annual General Meeting for the period from the AGM to the next AGM.
Board members may take on other duties on behalf of the
Company and be remunerated for such services according to a special agreement
approved by the Board of Directors.
The CEO’s terms of employment shall be based on a
written agreement. The CEO’s remuneration shall be agreed upon in line with his
responsibilities and on basis of his duties taking notice of the company’s size
and operations in general, and in line with general remuneration development in
the countries where
the company operates in and in line with the progress of the company.
The CEO’s remuneration may consist of fixed salary,
bonuses in cash payments and shares, stock options, warrants, pension fund
contributions and if deemed feasible redundancy and termination payments.
Remuneration of other key personnel shall also be based on the aforementioned
In the annual general meeting of the shareholders the
Board of Directors shall disclose to the shareholders the terms of employment
of the CEO, and board members of the Company. The Board of Directors shall
disclose the total amount paid in salaries in any form in the previous
financial year, payments from other companies within the Group, and stock
options and all other forms of payment pertaining to stock in the company and
retirement payments, if any.
Exposition with the Remuneration Policy for FL Group
89/2006 added Article 79 to the Act on Public Limited Companies. The article
requires the Board of Directors to set forth a Remuneration Policy prior to the
Annual General Meeting of the shareholders where it is put to a vote. The
Remuneration Policy shall stipulate the salary and other payments to the CEO
and other ranking employees as well as the Board of Directors. The Act
also states that the Remuneration Policy shall include fundamentals on terms of
employment of ranking employees and Board members along with the company’s
policy. It shall moreover stipulate if, the management
and directors can receive additional awards in the form of delivery of shares,
performance based payments, stock options and any and all payment having to do
with company shares or the future value of such shares, loan contracts, pension
funds, retirement or redundancy payments.
before mentioned legislative change was made on the grounds of Commission
Recommendation 2004/913/EC of 14 December 2004 fostering an
appropriate regime for the remuneration of directors of listed companies.
With this Remuneration Policy,
hereby submitted to the Annual General Meeting of the shareholders, the Board
of Directors of FL Group aims to set forth a Remuneration Policy that is in
compliance with law and regulations and will enable the company to attract skilled
employees and thereby guaranteeing the company’s competitiveness on an
4. Candidates for
the Board of Directors.
Notification of candidature for the Board of Directors shall be
submitted to the Board at least five days before the Annual General Meeting.
Candidatures will be published two days before the Annual General Meeting at
5. Proposal of the
company's Board of Directors on the company auditors.
It is proposed that KPMG Endurskoðun hf., Borgartún
27, Reykjavik, are re-elected as the company's auditors for 2007.
Proposals on amendments to the Articles of
It is proposed that subparagraph 2 in paragraph 4 is
deleted. (Requirement to call AGM with two weeks notice)
It is proposed that the following shall be added to
Article 8 after paragraph 6:
„The Board of Directors may
determine that shareholders meetings are held wholly or partly, by electronic
If the Board of Directors is of the opinion that
sufficiently secure equipment is available to be able to hold shareholders
meeting, wholly or partly, electronic and decides to use this authorization it
shall be clearly noted in the invitation to the meeting. The invitation to the
meeting shall contain information on the necessary equipment shareholders need
for participation, information about how shareholders notify the company of
their electronic participation, how the voting process will be and where
shareholders can get instructions on the electronic device, password for
participation and other information. The entered password is equal to the
shareholder’s signature and deemed as confirmation of his participation in the
Shareholders who intend to take advantage of their right
to participate electronically shall notify the company’s office with 5 day
prior notice and submit, in writing within the same timelimit, any questions
they might have regarding the agenda or presented documents they wish to have
answered at the meeting.
If the Board of Directors is of the opinion that it is
not plausible to hold shareholder meeting by electronic means,
the shareholders shall be entitled
to vote on all items of the Agenda in writing. The invitation to the meeting
shall specify how such a vote can be performed. Shareholders can request to
have their ballot sent and a request thereof shall be delivered to the
company’s headquarters 5 days prior to the shareholder’s meeting. The
shareholders can also collect their ballot at the company’s headquarters with
the same notice or vote there.“
It is proposed that numerical 4 be added to paragraph
Board of Directors proposal for a Remuneration Policy.“
Other numbers will change in accordance with the
It is proposed that the following be added in between
paragraph 3 and 4:
„In addition to a
candidate’s name, an identity number and address, information about main
occupation, other directorships, education, experience and holdings of share
capital in the company shall be stated in the notification of candidature.
Furthermore, all interest links with the principal business parties and
competitors of the company as well as with shareholders holding over 10% shares
in the Company shall be disclosed.
The company’s Board of Directors shall review the
notifications of candidature and in the case of faults to such notification it
shall grant the relevant parties in a verifiable manner an opportunity to improve
the faults within 24
hours. If the faults to the notification of candidature are not improved within
the time limit the company’s Board of
Directors will decide upon the validity of candidature. Candidates may appeal
the Boards’ decision to the shareholders meeting which has the final decisive
power on the validity of candidature.
Information concerning candidates to the Board of
Directors of a Public Limited Company shall be submitted on display to
shareholders at the company’s headquarters no later than two days in advance of
an Annual General Meeting.“
The proposals to change the Articles of Association mainly
derive from amendments to the Act on Public Limited Companies cf. Act no.
89/2006. In excess thereto it is proposed to shorten the notice to call the
Annual General Meeting from two weeks to one week.
Proposal on the company's Board of Directors'
authority to purchase shares in FL Group hf.
The Annual General Meeting of FL Group hf., held on
February 22nd 2007, agrees, with reference to Article 55 of the Act
on limited-liability companies, No. 2/1995, to authorize the company's Board of
Directors to purchase, over the next 18 months, up to 10% of the company's own
shares. The shares' purchase price may be up to 20% above the average sales
price of shares on the Iceland Stock Exchange in the two weeks immediately
preceding the purchase. No lower limit is set on this authorization, either
regarding the purchase price or the size of the share purchased each time. With
the approval of this proposal, an identical authorization approved at the last
Annual General Meeting is cancelled.