median. Before it was a 30 per cent increment
on top of the base salary of the other Executive
Board members.
In practice the median of the labour market peer
group has moved in the direction of increased
variable pay. This is reflected in the increase of
both the target annual bonus and target long-term
incentive for the CEO from 62 per cent to 100 per
cent of base salary and for the CFO from 62 per cent
to 75 per cent of base salary.
Maximum annual bonus changes marginally from
1.4 times target annual bonus to 1.5 times target
annual bonus, in line with the figures for the long-
term incentive plan.
The effect of the variable pay changes is to make
the package more performance sensitive. In 2005,
at target level, base salary accounted for 45 per
cent of the CEO's remuneration package. In the
new policy (as from 2007) it will account for only
33 per cent. For the CFO the figures are 45 per
cent and 40 per cent respectively.
Item 3b. Related amendment to the Long-Term
Incentive Plan for the Executive Board.
As part of the amendment of the remuneration
policy for the Executive Board, the value of the
shares that will be conditionally awarded (starting
with award of 2007) will be amended. At target level
such value will be 100 per cent of base salary for the
CEO and 75 per cent of the base salary for the CFO.
The General Meeting of Shareholders will be invited
to approve this amendment to the long-term
incentive plan.
Item 4: Extension of the authorisation of the
Executive Board to acquire own shares.
The General Meeting of Shareholders held on
20 April 2006 last gave an authorisation to the
Executive Board to acquire own shares. The General
Meeting of Shareholders is now requested to extend
the authorisation of the Executive Board.
It is proposed that the Executive Board be
authorised by the General Meeting of Shareholders,
for the statutory maximum period of 18 months,
starting 19 April 2007, to acquire own shares subject
to the following conditions and with due observance
of the law and the Articles of Association:
a. the maximum number of shares which may be
acquired is the statutory maximum of 10 per cent
of the issued share capital of the company;
b. transactions must be executed at a price
between the nominal value of the shares and
110 per cent of the opening price quoted for
the shares in the Official Price List (Officiële
Prijscourant) of Euronext Amsterdam on the
date of the transaction or, in the absence of
such a price, the latest price quoted therein;
c. transactions may be executed on the stock
exchange or otherwise.
The authorisation to acquire own shares may be
used in connection with the long-term incentive
plan for the members of the Executive Board and
the long-term incentive plan for the group senior
management, but may also serve other purposes,
such as acquisitions.
Item 5: Extension of the authorisation of the
Executive Board to issue (rights to) shares and to
restrict or exclude shareholders' pre-emptive rights.
The General Meeting of Shareholders held on
20 April 2006 last gave an authorisation to the
Executive Board to issue (rights to) shares and
to restrict or exclude shareholders' pre-emptive
rights. The General Meeting of Shareholders is
now requested to extend the authorisation of the
Executive Board.
It is proposed that the Executive Board be
authorised by the General Meeting of Shareholders,
for a period of 18 months, starting 19 April 2007, to
issue shares or grant rights to subscribe for shares
