LBi International

The extraordinary general meeting of shareholders on 2 May 2007 appointed Öhrlings PricewaterhouseCoopers AB as auditors until the Annual General Meeting in 2007.

Hans Jönsson is the auditor in charge, and has been since the merger between Framfab and LB Icon in 2006.

The auditors issue a report on their internal review (ordinarily in December) to the CEO and CFO. The auditors report on the observations and recommendations that stem from their review to the Board meeting at which the year end bulletin report is adopted. The auditor's report is released after the Board has published the annual report. The auditors participate in the general meeting and present the auditor's report. In between, the auditors are in contact with the Board member appointed to deal with auditing matters.

The general meeting of shareholders determines remuneration for the auditors. The general practice is that remuneration be fixed at the amounts that the auditors invoice on current account. Negotiations are conducted before the beginning of each fiscal year concerning the auditors' remuneration level.

Ever since LBi was founded, it has striven to enable its employees to have a stake in the company’s future, including the chance of owning shares in the company. At the Extraordinary General Meetings of shareholders it was resolved to implement an international employee stock option program for the group’s employees. The Employee Stock Option Program means that the group’s current and future employees can be allocated options to purchase shares (known as employee stock options), which entitle the holder of the options to acquire shares in LBi. No price is to be paid for these options. The redemption price for the options must essentially reflect the market value of the LBi share on the date on which the options were issued. The options may be used no earlier than six months and no later than seven years from the date on which they were issued and on condition that the holder of the options is still an employee of the group on the date on which they are redeemed. The distribution of options is determined by the Board of Directors or a committee appointed by the Board of Directors, with due reference to such criteria as the employee’s performance and his/her position within, and significance for, the group. The purpose of the option program is to create the conditions for maintaining and recruiting competent employees in the group.          

The 25 March 2004 annual general meeting voted to issue up to 6,000,000 employee stock options in accordance with the global options plan adopted by the 11 October 2000 extraordinary general meeting. At the time of the 30 March 2006 annual general meeting, the company had granted 2,700,000 options. None of these options were exercised as of 30 September 2006, and had all lapsed. The remaining 3,300,000 options entitle subscription for 66,000 shares after the reverse split of 50:1 executed in July 2006.

The merger between Framfab AB and LB Icon AB was registered on 31 July, 2006. As a result of the merger, it was decided to issue 1,896,124 new options to ensure fulfilment of LB Icon’s previous options program.

The 11 October 2006 extraordinary general meeting voted to issue a total of 1,835,000 options to the Group’s senior executives. Out of these options  1,285,000 have been granted to senior employees. Each option entitles the holder to subscribe for one share. The options totalled 3,740,915 as of June 2007 and shares may number up to 1,761,66

The Board of Directors has overall responsibility for internal monitoring, including risk management. The CEO is responsible for ensuring that internal monitoring is upheld and carried out.

Targets are set each year for the various countries. The company’s performance is then monitored against the targets and the outcome for the previous year. Limits are set for the entire business, which otherwise is highly decentralized. The Group conducts financial monitoring and performance comparisons among the units on a monthly basis.