Agenda Annual General Meeting 2001

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Annual General Meeting 2001

Agenda Annual General Meeting 2001

01 Submission of the approved company financial statements and management report for the business year 2000, the consolidated financial statements and management report for the Group for the business year 2000, and the report of the Supervisory Board

02 Resolution on the appropriation of the balance sheet profit from the business year 2000

The Supervisory Board and the Board of Management propose that the balance sheet profit of €221,180,090.00 be utilized for the payment of a dividend of €1.25 on each share entitled to dividend and that the amount apportionable to own shares be carried forward to new account.

If the number of shares entitled to dividend is reduced before the AGM as the result of the company buying back shares, it is planned to adjust the proposed resolution as follows: with an unchanged payment of €1.25 on each share entitled to dividend, the partial amount apportionable to shares no longer entitled to dividend shall be carried forward to new account and the tax expenses arising as a consequence of the smaller corporation tax reduction shall be shown separately.

03 Resolution to approve the actions of the Board of Management in respect of the business year 2000

The Supervisory Board and the Board of Management propose that approval for the Board of Management's actions be given.

04 Resolution to approve the actions of the Supervisory Board in respect of the business year 2000

The Supervisory Board and the Board of Management propose that approval for the Supervisory Board's actions be given.

05 Resolution on a further authorization to increase the company's share capital in order to issue employee shares (Authorized Capital Increase IV) and the relevant amendment to the Articles of Association

The Supervisory Board and the Board of Management propose that a further authorization to increase the company's share capital (Authorized Capital Increase IV) totalling €3,840,000 be granted in order to issue employee shares and that the Articles of Association be amended as follows:

a) A new paragraph 4 shall be inserted in Article 4 as follows: "(4) The Board of Management is authorized, with the consent of the Supervisory Board, to increase the Company's share capital at any time up to 18 July 2006 by an amount of up to 3,840,000 euros by issuing new registered shares against cash contribution (Authorized Capital Increase IV). The authorization may be exercised in part amounts. The shareholders' subscription rights shall be excluded to allow the shares to be issued to employees of the Munich Reinsurance Company and its affiliated companies. The Board of Management, with the consent of the Supervisory Board, shall determine all other details of the shares and the terms of issue."

b) The current paragraphs 4, 5, 6 and 7 in Article 4 shall become paragraphs 5, 6, 7 and 8 respectively.

06 Authorization to buy back shares

Article 71 para. 1 item 8 of the German Stock Companies Act gives stock companies the option of buying back their own shares – subject to prior authorization from the AGM – up to a total amount of 10% of their share capital. The authorization to buy back shares granted by the AGM on 19 July 2000 expires on 19 January 2002. So that, in the interests of the company and its shareholders, Munich Re can continue to have this flexible instrument at its disposal, the authorization is to be renewed.

The Supervisory Board and the Board of Management therefore propose that the following resolution be adopted:

In accordance with Article 71 para. 1 item 8 of the German Stock Companies Act, the company shall be authorized to buy back its own shares up to a total amount of 10% of the current share capital. The shares may be acquired via the stock exchange or via a public tender offer to all the shareholders. In the case of acquisition via the stock exchange, the purchase price (excluding incidental expenses) may not exceed or undercut by more than 10% the price determined for company shares with the same securities reference number in the opening auction in Xetra trading (or a comparable successor system). In the case of a public tender offer, the purchase price offered or the limits of the price spread offered per share (excluding incidental expenses) may not exceed or undercut by more than 15% the mean price for company shares with the same securities reference number in the closing auction in Xetra trading (or a comparable successor system) on the second to fourth trading days before the date on which the offer is published. If the offer is oversubscribed, acceptance shall be based on quotas. For this, the company may provide for preferred acceptance of small numbers of shares up to 100 shares tendered per shareholder.

The authorization to buy back shares may be exercised as a whole or in part amounts and for one or more purposes. It may not be used by the company for trading in its own shares. The authorization shall run until 18 January 2003. The authorization to buy back shares granted by the AGM on 19 July 2000 shall be cancelled as from the moment this new authorization comes into effect.

With the consent of the Supervisory Board, the shares acquired on the basis of this authorization may

a) be sold other than via the stock exchange or via an offer to all shareholders,

b) be used for the launching of the company's shares on foreign stock exchanges where they are not listed,

c) be offered in connection with mergers, acquisitions of companies or the purchase of shareholdings,

d) be partially or wholly retired without a further resolution of the AGM being required.

Shareholders' subscription rights in respect of these bought-back shares shall be excluded insofar as the shares are used in accordance with the aforementioned authorizations a), b) or c).

The price at which the shares are sold in accordance with authorization a) or launched on other stock exchanges in accordance with b) may not significantly undercut the stock market price (excluding incidental costs) of company shares with the same securities reference number at the time of sale. In addition, in these cases the sum of the shares to be sold, together with any shares that may be issued in accordance with Article 186 para. 3 sentence 4 of the German Stock Companies Act on the basis of an authorization to increase the capital with exclusion of subscription rights or on the basis of bonds with conversion rights or warrants issued with exclusion of shareholders' subscription rights, may not exceed a total of 10% of the share capital at the time the shares are sold or issued.

The authorizations to sell bought-back shares may be utilized one or more times, partially or wholly, individually or jointly.

Preconditions for attending the Annual General Meeting

Every shareholder may attend the Annual General Meeting in person or be represented by a proxy, provided the shareholder has given notice of his or her intention to participate to the Board of Management of the company not later than Wednesday, 11 July 2001, and is entered in the register of shareholders. Accordingly, the shares entered in the register of shareholders on 11 July 2001 shall be material for establishing the right to participate and voting rights. All shareholders who have fulfilled these conditions will receive an admission card for the AGM, which they should bring with them to the meeting.

 

As a special service, we offer our shareholders the opportunity to be represented at the AGM – in accordance with their instructions – by one of the proxies nominated by the company. This proxy may be appointed in writing by means of the form sent to shareholders, or via the Internet.

Shareholders who wish to use the Internet (www.munichre.com/AGM2001) to order admission cards or to appoint a proxy nominated by the company will need their shareholder number and the relevant AGM online password (HOP). Shareholders entered in our shareholders' register will receive this and other information by post.

Shareholders entered in our shareholders' register may also exercise their voting rights through a proxy appointed in writing, a bank or a shareholders' association. In this case we would ask our shareholders to send the forms they receive to a proxy of their choice, along with their voting instructions. If a bank is entered in the shareholders' register, it may only exercise the voting rights for shares that it does not own if it has an authorization to do so from the shareholders concerned.

Enquiries or motions from shareholders for the AGM should be sent to the following address only:

Münchener Rückversicherungs-Gesellschaft
ZA/G – Aktienregister
80791 München
Germany
shareholder@munichre.com

 

Munich, 31 May 2001

The Board of Management

 

For the AGM on 18 July 2001

Report of the Board of Management on the exclusions of subscription rights as proposed under items 5 and 6 of the agenda (Article 186 para. 4 sentence 2 in conjunction with Articles 71 para. 1 item 8 and 203 para. 1 of the German Stock Companies Act)

1) Re item 5 on the agenda

The authorization is intended to make it possible to issue shares at appropriate preferential conditions to employees of the Munich Reinsurance Company and its affiliated companies. This is with a view to enhancing staff's identification with, and aligning their interests more closely to, the objectives of the company and its shareholders. Under the German Stock Companies Act, the shares required for this may be issued from capital authorized for capital increases. The subscription rights of shareholders are excluded for this purpose. The volume of up to 1,500,000 shares represents only 0.8% of the current share capital and has been calculated on the basis of the five-year term of the authorization and the subscription results to be expected.

2) Re item 6 on the agenda

The authorization proposed in agenda item 6 is intended to enable the Board of Management, in the interests of the company and its shareholders, to buy back shares up to a total amount of 10% of the current share capital. The term of such an authorization is limited by law to 18 months. It has therefore become customary to have the authorization renewed annually. The proposed resolution is intended to replace the current authorization granted by the AGM on 19 July 2000, which would expire on 19 January 2002. The new authorization is the same in terms of content, scope and objective as the old authorization to be replaced, adopted at last year's AGM. Shares which the company buys back may be sold again via the stock exchange or a public offer to all shareholders. Besides this, the company may also limit the shareholders' pre-emptive rights and, in application of Article 186 para. 3 sentence 4 of the Stock Companies Act, may sell the company's own shares to institutional investors, for example, or launch the shares on foreign stock exchanges. This is in the interest of the company and puts it in a position to react quickly and flexibly to favourable stock market situations. The shares may only be sold at a price which does not significantly undercut the current stock market price. The Board of Management will endeavour – taking into account current market circumstances – to keep any discount on the stock market price as low as possible. The discount may on no account exceed 5%. The Board of Management will only avail itself of the authorization to exclude subscription rights in the sale of own shares, based on Article 186 para. 3 sentence 4 of the Stock Companies Act, insofar as together with existing authorizations to issue shares from capital approved for this purpose or as a result of an issue of bonds with conversion rights or warrants, the limit provided for under Article 186 para. 3 sentence 4 of the German Stock Companies Act – namely 10% of the company's share capital – is not exceeded.

The authorization also gives Munich Re the possibility of having own shares available to offer as a consideration in connection with mergers, acquisitions of companies or the purchase of shareholdings. International competition and the globalization of the economy increasingly require this type of acquisition financing. The authorization proposed is intended to give the company the necessary scope to take quick and flexible advantage of opportunities that arise for acquiring companies or shareholdings. This is reflected in the proposed exclusion of pre-emptive rights. In determining the valuation ratios, the Board of Management will ensure the interests of the shareholders are appropriately considered. As a rule, when measuring the value of the shares offered as a consideration, it will take as a basis the stock market price of Munich Re shares. However, a systematic coupling of the valuation to a stock market price is not provided for, in particular to prevent fluctuations in the share price from jeopardizing negotiation outcomes once they have been reached. Munich Re currently also has Authorized Capital Increase III available for the acquisition of companies or shareholdings. The type of share procurement used to finance such transactions will be decided on by the Board of Management, with the consent of the Supervisory Board, the sole criteria being the interests of the shareholders and the company.

There are no concrete plans at present that would necessitate making use of the authorizations to sell own shares in accordance with a), b) or c) of the aforementioned resolution, which exclude shareholders' subscription rights.

 

Finally, the company will be authorized to retire shares without requiring a new resolution of the AGM.

 

If the authorization is utilized, the Board of Management will inform shareholders about the details at the next AGM following the utilization.

 

Munich, 31 May 2001

The Board of Management


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