Ericsson introduces a new employee option program

Ericsson introduces a new employee option program The Board of Directors of Telefonaktiebolaget LM Ericsson has today decided on the principles for a new option program for the years 2000 - 2002. The program is directed towards about 5,000 employees in the US, and about 2,000 employees in the rest of the world. During the period 20 million options are scheduled to be granted to the employees as follows: 14.3 million options for year 2000, 3.8 million options for year 2001 and 3.8 million options for year 2002. A decision by the shareholders to approve the program is required. An Extraordinary General Meeting of Shareholders for the approval of the year 2000 new issue is therefore planned for 4 November 1999. Ericsson will, by today's decision, be able to use options more frequently as part of a competitive compensation package offered to important categories of employees and new hires. Ericsson has under previous programs granted options to about 500 employees for 1998 and as estimated to about 2,500 employees for 1999. These programs have been based on so called market options and have been more limited in their scope than the new program. The program now introduced by Ericsson is based on the issue of bond with warrants, which are immediately detachable in order to be used for the intended purpose. The program is largely directed towards Ericsson in the United States. For this reason it is as close as possible aligned with the American practice of using options as an important part of compensation to a large group of employees. In order to create a long-term joint interest with the company's shareholders, the final vesting of the options with employees participating in the program will be subject to the continuation of the employment for a certain period of time. The increase of the share capital will, if all warrants granted for the year 2000 will be exercised, amount to SEK 35,685,000, which corresponds to a dilution of about 0.72 percent of the share capital. Ericsson is the leading provider in the new telecoms world, with communications solutions that combine telecom and datacom technologies with freedom of mobility for the user. With more than 100,000 employees in 140 countries, Ericsson simplifies communications for its customers - network operators, service providers, enterprises and consumers - the world over. Please visit Ericsson's Press Room at: http://www.ericsson.se/pressroom FOR FURTHER INFORMATION, PLEASE CONTACT Erling Blommé, Corporate Legal Affairs Phone: +46 70 590 1553 ------------------------------------------------------------ Please visit http://www.bit.se for further information The following files are available for download: http://www.bit.se/bitonline/1999/10/05/19991005BIT00670/bit0001.doc http://www.bit.se/bitonline/1999/10/05/19991005BIT00670/bit0002.pdf