Note
This publication is available exclusively to Munich Re clients. Please contact your Client Manager.
These documents are available on the internet at www.munichre.com/agm (under “Documents”) as parts of the Annual Report 2014 of Münchener Rückversicherungs-Gesellschaft Aktiengesellschaft in München (hereinafter referred to as “Munich Reinsurance Company” or “the Company”) and in the Munich Re (Group) Annual Report 2014. The annual reports will be sent to shareholders on request. In addition, the documents will be available and explained at the Annual General Meeting. The Supervisory Board has already approved the Company fi nancial statements and the Group fi nancial statements. In accordance with statutory provisions, there will therefore be no resolution in respect of this agenda item.
As the number of Munich Re shares has changed since the
invitation to the AGM was published and now stands at 6,099,887,
the Supervisory Board and Board of Management have updated their
proposal regarding appropriation of the net retained profits.
The Supervisory Board and the Board of Management propose that the
net retained profits for 2014 of
€1,340,305,289.50 be utilised as
follows:
Pursuant to Section 120 (4) of the Stock Corporation Act, the
Annual General Meeting can pass a resolution to approve the
remuneration system for members of the Board of Management.
The resolution pertaining to this agenda item relates to the
remuneration system for members of the Board of Management
applicable at Munich Reinsurance Company since 1 January 2013. A
description of this system is provided in the remuneration report,
which forms part of the (Group) management report included in the
annual reports referred to under agenda item 1. As already
mentioned, the annual reports can be accessed on our website
at www.munichre.com/agm (under
“Documents”). They
will also be sent to shareholders on request. In addition, they
will be available and explained at the Annual General Meeting.
The Supervisory Board and the Board of Management propose that the
remuneration system for members of the Board of Management
applicable since 1 January 2013 be approved.
Unless expressly permitted by law, Munich Reinsurance Company
requires the authorisation of the Annual General Meeting to buy
back shares. The authorisation granted on 30 April 2014 has been
exhausted to a significant extent by the share buy-back programme
launched in May 2014. To again provide the Company with the full
scope of active capital management afforded by such authorisation,
it will be proposed to the Annual General Meeting that the Company
be granted a further authorisation to buy back own shares.
The Supervisory Board and the Board of Management propose that the
following resolutions be adopted:
a) The Company shall be authorised to buy back shares up to a
total amount of 10% of the share capital at the time the resolution
is adopted. If at the time this authorisation is first exercised
the existing share capital is lower, that amount shall be deemed to
apply. The authorisation may be exercised as a whole or in partial
amounts, on one or more occasions and for one or more purposes by
the Company, but also by dependent companies or enterprises in
which the Company has a majority shareholding
(“Group
companies”), or by third parties for its or
their account. The shares acquired plus other own shares in the
possession of the Company, or attributable to the Company pursuant
to Sections 71d and 71e of the Stock Corporation Act may at no time
amount to more than 10% of the share capital. The authorisation may
not be used for trading in own shares.
b) The shares shall be acquired at the discretion of the Board of
Management aa) via the stock exchange; or bb) via a public purchase
offer to all shareholders; or cc) via a solicitation to all
shareholders to submit sales offers (request to sell); or dd) via a
public offer to all shareholders to exchange Munich Re shares for
shares in another listed company as defined in Section 3 (2) of the
Stock Corporation Act.
aa) If the shares are bought back via the stock exchange, the
purchase price (excluding incidental expenses) may not exceed by
more than 10% or undercut by more than 20% the arithmetic mean of
the closing price in Xetra trading on the Frankfurt Stock Exchange
determined for Company shares with the same securities reference
number on the last three days of trading prior to the commitment to
purchase.
bb) If the shares are bought back via a public purchase offer, the
purchase price per share or the upper and lower limits of the price
range (excluding incidental expenses) may not exceed by more than
10% or undercut by more than 20% the arithmetic mean of the closing
price determined in Xetra trading on the Frankfurt Stock Exchange
for Company shares with the same securities reference number on the
fifth, fourth and third trading day before the date on which the
offer is published. If after a public purchase offer there are
significant deviations in the relevant share price, the offer may
be adjusted. In this case, the basis for determining the purchase
price or the purchase price range will be the arithmetic mean of
the closing price determined in Xetra trading on the Frankfurt
Stock Exchange for Company shares with the same securities
reference number on the fifth, fourth and third trading day before
the public announcement of the adjustment. The volume may be
restricted. If the offer is oversubscribed, the
shareholders’ right to tender shares may be
excluded insofar as acceptance is based on quotas. The Company may
provide for preferred acceptance of small lots of shares (up to 100
shares tendered per shareholder). The purchase offer may provide
for further conditions.
cc) If the Company publicly solicits submission of offers to sell
Munich Reinsurance Company shares, the Company may in its
solicitation state a purchase price range within which offers may
be submitted. The solicitation may provide for a submission period,
terms and conditions, and the possibility of adjusting the purchase
price range during the submission period if, after publication of
the solicitation, significant share price fluctuations occur during
the submission period. Upon acceptance, the final purchase price
shall be determined from all the submitted sales offers. The
purchase price (excluding incidental expenses) for each Company
share may not exceed by more than 10% or undercut by more than 20%
the average closing price of Company shares in Xetra trading on the
fifth, fourth and third trading day prior to the relevant date. The
relevant date shall be the date on which the offers are accepted by
the Company. If the number of Company shares offered for sale
exceeds the total volume of shares the Company intended to acquire,
the shareholders’ right to tender shares
may be excluded insofar as acceptance is based on quotas. The
Company may provide for preferred acceptance of small lots of
shares (up to 100 shares tendered per shareholder).
dd) In the case of a public offer to exchange Munich Re shares for
shares in another listed company (“exchange
shares”) as defined in Section 3 (2) of the
Stock Corporation Act, a certain exchange ratio may be specified or
also determined by way of an auction procedure. A cash benefit may
also be provided for as an additional payment to the exchange
offered or as compensation for any fractional amounts. In each of
these procedures for the exchange of shares, the exchange price or
the applicable upper and lower limits of the price range in the
form of one or more exchange shares and calculated fractional
amounts, including any cash or fractional amounts (excluding
incidental expenses), may not exceed by more than 10% or undercut
by more than 20% the relevant value of Company shares. The basis
for calculating the relevant value of each Company share and of
each exchange share shall be the respective arithmetic mean of the
closing price in Xetra trading on the Frankfurt Stock Exchange on
the fifth, fourth and third trading day before the date on which
the exchange offer is published. If the exchange shares are not
traded in the Xetra trading system on the Frankfurt Stock Exchange,
the basis shall be the closing prices quoted on the stock exchange
having the highest average trading volume in respect of the
exchange shares in the course of the preceding calendar year. If
after a public exchange offer there are significant deviations in
the relevant share price, the offer may be adjusted. In this case,
the basis for the adjustment shall be the arithmetic mean closing
price on the fifth, fourth and third trading day before the date of
the public announcement of the adjustment. The volume may be
restricted. If the exchange offer is oversubscribed, the
shareholders’ right to tender shares may be
excluded insofar as acceptance is based on quotas. The Company may
provide for preferred acceptance of small lots of shares (up to 100
shares tendered per shareholder). The exchange offer may provide
for further conditions.
c) The Board of Management shall be empowered to use shares
acquired on the basis of the aforementioned or previously granted
authorisations or pursuant to Section 71d sentence 5 of the Stock
Corporation Act for all legally admissible purposes, and in
particular as follows::
aa) They may be used for launching the
Company’s shares on foreign stock exchanges
where they are not yet admitted to trading.
bb) They may be sold directly or indirectly in return for non-cash
payment, in particular as part of offers to third parties in
connection with mergers or acquisitions of companies or parts of
companies, shareholdings or other assets. Selling in this
connection may also include the granting of conversion or
subscription rights or of warrants and the transferring of shares
in conjunction with securities lending.
cc) They may be sold to third parties for cash other than via the
stock exchange or via an offer to all shareholders.
dd) They may be used for the hedging of or delivery under warrants
or conversion rights or conversion obligations, in particular
arising out of or in connection with convertible bonds or bonds
with warrants issued by the Company or by one of its dependent
Group companies. If own shares are offered to all shareholders, the
number of shares to which holders of such warrants or conversion
rights/obligations would be entitled as shareholders after
exercising their conversion right or warrant or meeting their
conversion obligation may also be offered to such holders of
warrants or conversion rights/obligations.
ee) They may be directly or indirectly offered for purchase and
transferred to current or former employees of the Company or its
affiliated companies, or to Board members of its affiliated
companies. The shares may also be transferred to a third party
provided that it is ensured from a legal perspective that such
third party will offer and transfer the shares to the persons
mentioned above.
ff) They can be offered to all shareholders in order to enable
them to subscribe for own shares against full or partial assignment
of their right to payment of the dividend arising out of the
resolution on the appropriation of profits at the Annual General
Meeting (scrip dividend).
gg) They may be retired without a further resolution of the Annual
General Meeting being required. Any retirement may be limited to a
portion of the bought-back shares. The Board of Management may
determine that the shares can also be retired in a simplified
process, without reducing the share capital, by adjusting the
proportion of the Company’s share capital
represented by each of the remaining no-par-value shares. In this
case, the Board of Management shall be authorised to adjust the
number of no-par-value shares in the Articles of Association.
d) The Supervisory Board shall be empowered to use Company shares
acquired on the basis of the aforementioned or previously granted
authorisations or pursuant to Section 71d sentence 5 of the Stock
Corporation Act as follows:
They may be transferred to the members of the
Company’s Board of Management as part of
their remuneration. This particularly applies if the rules
governing the remuneration of the members of the Board of
Management require or will require the Board members to invest part
of the variable remuneration assigned to them in Company shares
that must be held for a specific period of time. If this
requirement relates to a variable remuneration component assessed
on a multi-year basis, a minimum holding period of around two years
shall be stipulated. In all other cases, the minimum holding period
shall be approximately four years.
To be eligible, an individual must be a member of the Board of
Management either at the time of transfer of, or at the beginning
of the assessment period for, the variable remuneration component
concerned. The details of remuneration for members of the Board of
Management are established by the Supervisory Board. These include
rules on how to deal with holding periods in special cases such as
retirement, disability or death.
e) The price at which the shares are launched on other stock
exchanges in accordance with subitem c) aa or sold in accordance
with subitem c) cc may not significantly undercut the opening stock
price in Xetra trading on the Frankfurt Stock Exchange determined
for Company shares with the same securities number (excluding
incidental costs) on the day the shares are launched or the binding
agreement with the third party is concluded. In addition, in these
cases the sum of the shares sold, together with any shares that may
have been or will be issued or sold during the term of this
authorisation by directly or indirectly excluding the
shareholders’ subscription rights, pursuant
to Section 186 (3) sentence 4 of the Stock Corporation Act, may not
exceed a total of 10% of the share capital, either at the time this
authorisation enters into force or when the shares are issued or
sold.
f) Should the Xetra trading system be replaced by a comparable
successor system, the latter shall also take the place of the Xetra
trading system for the purposes of this authorisation.
g) The authorisations in accordance with subitems c) and d) may be
utilised one or more times, partially or wholly, individually or
jointly; the authorisations in accordance with subitem c) bb, cc,
dd or ee may also be utilised by dependent Group companies or
enterprises in which the Company has a majority shareholding, or
utilised for its or their account by third parties.
h) Shareholders’ subscription rights in
respect of these bought-back shares shall be excluded insofar as
the shares are used in accordance with the authorisations in
subitems c) aa, bb, cc, dd, ee or d). If the own shares are used
for the purpose mentioned in c) ff, the Board of Management shall
be authorised to exclude the right of subscription.
i) The authorisation shall valid until 22 April 2020. The
authorisation to buy back and use own shares granted by the Annual
General Meeting on 30 April 2014 shall be cancelled as from the
moment this new authorisation comes into effect.
In addition to the acquisition channels proposed in the
authorisation under item 6 of the agenda, the possibility to buy
back own shares by using derivatives is also to be provided
for.
The Supervisory Board and the Board of Management therefore
propose that the following resolutions be adopted:
a) By virtue of the authorisation granted at the Annual General
Meeting on 23 April 2015 under item 6 of the agenda, the Company
may in accordance with the provisions of subitems b) to h) below
buy back own shares also by using derivatives in the form of put
options, call options, forward purchase contracts (where shares are
delivered more than two days after conclusion of the purchase
contract), or a combination of such instruments (hereinafter all
referred to as
“derivatives”).
b) Derivatives may be used in one of the ways outlined under aa),
bb) or cc) below, or in a combination of these:
aa) Derivatives may be issued or acquired via Eurex Deutschland or
LIFFE (or a comparable successor system). In this case, the Company
shall inform shareholders of any planned issue or acquisition of
derivatives by placing a public announcement in the newspapers.
Different exercise prices (excluding incidental expenses) on
different due dates may be selected for the derivatives, even if
they are being issued or acquired at the same time.
bb) The issue of put options, the purchase of call options, the
conclusion of forward purchase contracts or a combination of such
derivatives and their respective fulfilment may also be conducted
outside the stock exchanges listed under aa) if the shares to be
delivered to the Company on exercise of the derivatives have
previously been acquired via the stock exchange at the current
share price in Xetra trading on the Frankfurt Stock Exchange.
cc) The conclusion of put or call option contracts may be publicly
offered to all shareholders, or option contracts may be concluded
with a bank or a credit institution (hereinafter referred to as
“underwriter”)
pursuant to Section 53 (1) sentence 1 or Section 53b (1) sentence 1
or (7) of the German Banking Act (KWG), subject to the obligation
to offer these options to all shareholders for subscription.
The Company may only buy back the derivatives outlined under items
aa) to cc) in order to retire them.
c) In the case of item b) aa and bb, the exercise price of the
options or the acquisition price payable in settlement of a forward
purchase contract (in each case excluding incidental expenses) per
share may not exceed by more than 10% or undercut by more than 20%
the opening price determined in Xetra trading on the Frankfurt
Stock Exchange for Company shares with the same securities number
on the day the derivative contract is concluded. If own shares are
bought back using options, the acquisition price (excluding
incidental expenses) payable by the Company for the shares
corresponds to the exercise price agreed on in the option. The
acquisition price (excluding incidental expenses) paid by the
Company for options may not exceed, nor may the sale price
(excluding incidental expenses) collected by the Company for
options fall short of, the theoretical market value of the
respective option determined according to recognised principles of
financial mathematics, the calculation of such market value
considering among other things the agreed exercise price. The
forward price agreed on by the Company in forward purchase
contracts may not be substantially higher than the theoretical
forward price determined according to recognised principles of
financial mathematics, the calculation of such forward price
considering among other things the current stock market price and
the term of the forward purchase contract.
d) In the case of subitem b) cc, the exercise price of the options
(excluding incidental expenses) per share may not exceed by more
than 10% or undercut by more than 20% the arithmetic mean of the
closing price determined for Company shares with the same
securities number in Xetra trading on the Frankfurt Stock Exchange
on the fifth, fourth and third trading day prior to publication of
the offer. In the event that the offer to shareholders is
oversubscribed, the shareholders’ right to
tender shares may be excluded insofar as acceptance is based on
quotas. The Company may provide for a preferred offer for
concluding option contracts or a preferred allocation of options
for small lots of shares (options up to 100 shares per
shareholder).
e) The term of the derivatives shall be a maximum of 18 months in
each case and be so determined that exercising derivatives to
acquire shares will be completed by 22 April 2020 at the latest.
The Company may use derivatives to acquire own shares up to a
maximum of 5% of the share capital at the time the resolution is
adopted at the Annual General Meeting. If at the time this
authorisation is first exercised the existing share capital is
lower, that amount shall be deemed material.
f) If derivatives are used to buy back own shares pursuant to
subitem b) aa or bb, shareholders shall not have a claim to
conclude such derivative contracts with the Company, in line with
the provisions of Section 186 (3) sentence 4 of the Stock
Corporation Act. Shareholders shall also not have the right to
conclude derivative contracts to the extent that, on conclusion of
derivative contracts pursuant to subitem b) cc, the Company has
provided for a preferred offer or preferred allocation for the
conclusion of derivative contracts with regard to small lots of
shares. Shareholders shall have a right to tender their shares to
the Company only insofar as the Company is obligated to purchase
shares from them pursuant to the derivative contracts.
g) The authorisation may be exercised as a whole or in part
amounts, on one or more occasions and for one or more purposes by
the Company, but also by dependent Group companies or enterprises
in which the Company has a majority shareholding, or by third
parties for its or their account.
h) In all other respects, the conditions and uses of the
authorisation granted under item 6 of the agenda shall apply.
The authorisation granted by the Annual General Meeting on 28
April 2010 concerning the issue of convertible bonds and/or bonds
with warrants was limited to a period of five years and expires on
27 April 2015. The authorisation is to be extended to cover the
ability to issue profit participation certificates or profit
participation rights and renewed, so that those instruments will be
available to the Company if required in the coming years. As no
convertible bonds or bonds with warrants were issued under the
authorisation granted in 2010, the existing Contingent Capital
Increase 2010 for €117m is no longer needed
to cover them and is to be replaced by a new Contingent Capital
Increase 2015.
The Supervisory Board and the Board of Management propose that the
following resolutions be adopted:
a) Authorisation
aa) Period of authorisation, nominal amount, term to maturity,
number of shares, currency, issue by Group companies
The Board of Management shall be authorised, with the consent of
the Supervisory Board, to issue, in one or more issues up to 22
April 2020, convertible bonds, bonds with warrants, profit
participation rights, profit participation certificates or
combinations of such instruments (hereinafter collectively referred
to as “bonds”) for
a maximum nominal amount of €3bn with or
without a limited term to maturity and to grant the holders of or
creditors under such bonds (hereinafter collectively referred to as
“holders”)
conversion rights, warrants or conversion obligations in respect of
shares of the Company up to a maximum amount of
€117m of the share capital, in accordance
with the respective bond conditions.
The bonds may be issued to bearer or registered. Bonds may also be
issued against non-cash payment. The bonds may be denominated in
the legal currency of another OECD country as well as in euros,
provided the equivalent amounts to those stated above in euros are
not exceeded. They may also be issued by dependent Group companies
or companies in which the Company has a majority shareholding
(“Group
companies”); in this case, the Board of
Management shall be authorised to guarantee the bonds on behalf of
the Company and to grant the holders of such bonds conversion
rights, warrants or conversion obligations on the
Company’s shares.
Fixed and/or variable interest rates may be payable on the
bonds.
bb) Subscription right, exclusion of subscription right
Shareholders are generally entitled to a subscription right in
respect of these bonds. The bonds may also be underwritten by one
or more banks or equivalent institutions pursuant to Section 186
(5), sentence 1 of the Stock Corporation Act subject to the
obligation to offer them to the shareholders. If bonds are issued
by a Group company, the Company must ensure that the shareholders
of Munich Reinsurance Company are granted subscription rights
pursuant to the law in accordance with the previous sentence.
However, the Board of Management shall be authorised, with the
consent of the Supervisory Board, to exclude the
shareholders’ subscription rights in the
following cases:
(1) insofar as it is necessary in respect of fractional amounts
resulting from the subscription ratio;
(2) insofar as it is necessary to grant subscription rights to the
holders of already issued bonds with conversion rights, warrants or
conversion obligations in respect of shares of the Company to the
extent to which they would be entitled as shareholders after
exercising those rights or meeting the conversion obligations;
(3) insofar as bonds with conversion rights, warrants or
conversion obligations are issued against cash and the issue price
is not significantly below the bonds’
theoretical market value determined according to recognised
principles of financial mathematics. However, this authorisation to
exclude subscription rights shall apply only to the extent that the
shares issued to cover the related conversion rights and/or
warrants do not represent more than 10% of the share capital,
either on the date on which the authorisation becomes effective or
the date on which such authorisation is exercised. This maximum
limit shall include shares sold or issued, or to be issued, during
the term of this authorisation on the basis of other authorisations
with exclusion of subscription rights, directly or indirectly
pursuant to Section 186 (3) sentence 4 of the Stock Corporation
Act;
(4) insofar as profit participation rights or profit participation
certificates are issued without conversion rights, warrants or
conversion obligations and such profit participation rights or
profit participation certificates have features similar to those of
a bond, i.e. they do not confer any entitlement to membership of
the Company or to a share in the proceeds of liquidation and the
interest or return payable is not calculated on the basis of the
amount of the profit for the year, the net retained profits or the
dividend. Furthermore, in this case the interest or return payable
on and the issue price of the profit participation rights or profit
participation certificates must correspond to the market conditions
as at the date of issue;
(5) insofar as bonds are to be issued against non-cash payment,
the exclusion of subscription rights, especially in the context of
company mergers or in connection with the acquisition of companies
or participations, is in the interests of the Company, and the
value of the non-cash payment is proportionate to the
bonds’ theoretical market value determined
according to recognised principles of financial mathematics.
Together with shares issued against non-cash payment on the basis
of Authorised Capital Increase 2013 by excluding subscription
rights and pursuant to Section 186 (3) sentence 4 of the Stock
Corporation Act, the total of the shares issued on the basis of
this authorisation subject to the exclusion of shareholder
subscription rights may not exceed 20% of the existing share
capital either at the time this authorisation comes into force or
when the authorisation is first exercised, whichever amount is the
lower.
cc) Conversion right, conversion obligation
In the event of the issue of bonds with conversion rights, the
holders may convert their bonds into Company shares in accordance
with the bond conditions. The proportional amount of share capital
represented by the shares to be issued as a result of the
conversion may not exceed the nominal amount of the convertible
bond or the issue price if lower. The conversion ratio is
determined by dividing the nominal amount, or the issue price if
lower, of one convertible bond by the conversion price defined to
acquire one Company share. The conversion ratio may be rounded up
or down to a whole figure; in addition, a supplementary cash
payment may be specified. Furthermore, the conditions may provide
for fractional amounts to be combined and/or compensated for in
cash. The bond conditions may also provide for a variable
conversion ratio.
The conditions may include an obligation to convert at maturity or
at another date (hereinafter both referred to as
“final maturity”)
or entitle the Company at final maturity of the bonds, in full or
partial substitution for paying the amount due, to grant the
holders of the bonds shares in the Company or in another company
listed on a stock exchange (Company’s right
of substitution).
In this case, the Company may be entitled in the terms and
conditions of the bonds to compensate fully or partially in cash
any difference between the nominal amount of the convertible bonds
or convertible profit participation right and the result obtained
from multiplying a market price for the shares at the time of the
mandatory exchange – such price to be more
closely defined in the terms and conditions of the convertible
bonds, but to be at least 50% of the share price relevant for the
lower conversion price limit pursuant to ee) below
– by the conversion ratio.
dd) Warrants
In the event of a warrants issue, one or more warrants shall be
attached to each bond that entitle the holder to subscribe for
shares in Munich Reinsurance Company in accordance with the warrant
conditions. The proportional amount of the share capital to be
subscribed for per bond may not exceed the nominal value of the
bond. The bond conditions may also stipulate that the number of
shares subscribed for on exercise of the warrants is variable. The
warrant conditions for bonds with warrants denominated in euros
issued by the Company may stipulate that the exercise price can
also be paid by transfer of bonds
(“trade-in”)
together with, if necessary, a cash payment.
ee) Exercise or conversion price, protection against dilution
The conversion or exercise price fixed for one share must be at
least 50% of the average closing price of Munich Reinsurance
Company shares in Xetra trading on the Frankfurt Stock Exchange (or
equivalent successor system) on the ten trading days preceding the
date of the Board of Management’s final
decision on the issue of the bonds. In the case of subscription
rights trading, the relevant days are those on which the
subscription rights are traded on the Frankfurt Stock Exchange,
with the exception of the last two days of subscription rights
trading on the stock exchange.
If a conversion obligation or a Company right of substitution is
provided for in accordance with cc), the exercise or conversion
price for one share can be the average closing price of Munich
Reinsurance Company shares in Xetra trading on the Frankfurt Stock
Exchange (or equivalent successor system) on the ten trading days
preceding or following the final maturity date, even if such
exercise or conversion price is below the minimum price stipulated
in the previous paragraph. Sections 9 (1) and 199 (2) of the Stock
Corporation Act remain unaffected.
Notwithstanding Section 9 (1) of the Stock Corporation Act, the
conditions of the convertible bonds or bonds with warrants may
contain a clause safeguarding against the dilution of stock for the
event that during the conversion or exercise period the Company, in
granting its shareholders subscription rights, either increases its
capital or issues further bonds with conversion rights, warrants or
conversion obligations, and does not grant the holders of such
convertible bonds, bonds with warrants or conversion obligations
subscription right to the extent to which they would have been
entitled after exercising the conversion or exercise rights or
after meeting the conversion obligations. The terms and conditions
may also provide for the conversion/exercise price or the
conversion/exercise ratio to be adjusted or cash components to be
granted in the event of other measures being taken by the Company
that might lead to a dilution in the value of the conversion rights
and/or warrants. The proportional amount of the share capital to be
subscribed for per bond may on no account exceed the nominal value
of the bond.
ff) Other possible structures
Subject to compliance with the above conditions, the Board of
Management shall be authorised to determine all further details of
the issue and terms and conditions of the bonds or to establish
such terms and conditions in agreement with the executive bodies of
the Group company issuing the bonds, particularly the issue price,
the maturity and denomination, agreement of any subordination to
other liabilities, the subscription or conversion ratio (e.g. a
variable conversion ratio depending on the performance of the share
price during the term or a conversion ratio based on a bond issue
price lower than the nominal value), fixing of an additional cash
payment, compensation for or combination of fractional amounts, the
exercise or conversion price (also whether, for example, the price
is to be fixed on the issue of the bonds or on the basis of future
share prices within a defined band), and the exercise or conversion
period. The conditions may also stipulate whether the
Company’s own shares, payment of the
equivalent value in cash, or other securities listed on a stock
exchange may be offered instead of fulfilment by way of contingent
capital increase and, in the case of mandatory convertible bonds,
how details of the performance, terms and fixing of the exercise or
conversion price are to be determined.
b) Contingent capital increase
There shall be a contingent increase in the share capital by up to
€117m to be through the issue of new
registered no-par-value shares with entitlement to dividend from
the beginning of the financial year in which they are issued
(Contingent Capital Increase 2015). The purpose of this contingent
capital increase is to permit shares to be granted to the holders
of or creditors under convertible bonds, bonds with warrants,
profit participation rights or profit participation certificates
(or combinations of such instruments) with conversion rights,
warrants or conversion obligations that are issued by dependent
Group companies or companies in which the Company has a majority
shareholding in accordance with the authorisation granted for the
period from 23 April 2015 to 22 April 2020. The new shares shall be
issued at the exercise and conversion price fixed in accordance
with the criteria of the aforementioned authorisation. The increase
in the share capital shall be carried out only to the extent that
warrants or conversion rights under the bonds are exercised or
conversion obligations under such bonds are fulfilled and insofar
as other means of fulfilment are not introduced. The Board of
Management shall be authorised to decide on the further details of
the contingent capital increase.
c) Amendment to the Articles of Association
Article 4 (3) of the Articles of Association shall be reworded as
follows:
“(3) A contingent increase in the share
capital by a further amount of up to 117 million euros, consisting
of new registered no-par-value shares with entitlement to dividend
from the beginning of the financial year in which they are issued,
has been authorised. The purpose of this contingent capital
increase is to permit shares to be granted to the holders of or
creditors under convertible bonds, bonds with warrants, profit
participation rights or profit participation certificates (or
combinations of such instruments) with conversion rights, warrants
or conversion obligations that are issued by dependent Group
companies or companies in which the Company has a majority
shareholding in accordance with the authorisation granted by the
Annual General Meeting for the period from 23 April 2015 to 22
April 2020. It shall be carried out only to the extent that
warrants or conversion rights under the above-mentioned bonds are
exercised or conversion obligations under such bonds are fulfilled
and insofar as other means of fulfilment are not introduced. The
Board of Management shall be authorised to decide on the further
details of the contingent capital increase (Contingent Capital
Increase 2015).”
d) Cancellation of the authorisation of 28 April 2010 and the
Contingent Capital Increase 2010
No bonds with conversion rights, warrants or conversion
obligations in respect of Munich Reinsurance Company shares were
issued on the basis of the authorisation of the Annual General
Meeting granted on 28 April 2010. The authorisation granted by the
Annual General Meeting on 28 April 2010 concerning the issue of
convertible bonds and/or bonds with warrants, and the Contingent
Capital Increase 2010 in the amount of €117m
approved by the Annual General Meeting shall be cancelled on the
new authorisation and the new Contingent Capital Increase 2015
coming into effect.
The Authorised Capital Increase 2011 to issue employee shares
expires on 19 April 2016. In order to allow the Company to continue
to offer its staff and affiliated companies employee shares from
capital authorised for this purpose, a new Authorised Capital
Increase 2015 amounting to €10m is to be
created for the purpose of issuing employee shares.
The Supervisory Board and the Board of Management therefore
propose that the following resolutions be adopted:
a) Authorisation
aa) The Board of Management shall be authorised, with the consent
of the Supervisory Board, to increase the
Company’s share capital at any time up to
22 April 2020 by an amount of up to €10m by
issuing new registered no-par-value shares against cash
contribution (Authorised Capital Increase 2015). The authorisation
may be exercised in part amounts. The subscription right of
shareholders shall be excluded to allow the shares to be issued to
employees of the Company and its affiliated companies.
bb) The new shares may also be issued to a bank or a credit
institution pursuant to Section 53 (1) sentence 1 or Section 53b
(1) sentence 1 or (7) of the German Banking Act (KWG), subject to
the obligation to offer such shares exclusively to employees of
Munich Reinsurance Company and its affiliated companies. Where
legally permissible, the new shares may also be issued to other
third parties, provided it is ensured from a legal perspective that
the shares will be offered and transferred to employees of Munich
Reinsurance Company or its affiliated companies. Shares offered to
employees may also be transferred at the end of a vesting period or
subject to a holding period. Shareholders’
subscription rights shall be excluded insofar as the shares are
issued and used pursuant to item bb).
cc) Where legally permissible, the employee shares may also be
issued in such a manner that the contribution to be made for them
is covered by that portion of the profit for the year which the
Board of Management and the Supervisory Board may transfer to other
revenue reserves pursuant to Section 58 (2) of the Stock
Corporation Act.
dd) The Board of Management shall be authorised, with the consent
of the Supervisory Board, to determine all other rights of the
shares and the terms of issue. Notwithstanding Section 60 (2) of
the Stock Corporation Act, the entitlement to dividend of the new
no-par-value shares can be determined.
b) Amendment to the Articles of Association
Article 4 (2) of the Articles of Association shall be reworded as
follows:
“(2) The Board of Management shall be
authorised, with the consent of the Supervisory Board, to increase
the Company’s share capital at any time up
to 22 April 2020 by an amount of up to 10 million euros by issuing
new registered no-par-value shares against cash contribution
(Authorised Capital Increase 2015). The authorisation may be
exercised in part amounts. The subscription right of shareholders
shall be excluded to allow the shares to be issued to employees of
the Company and its affiliated companies. The new shares may also
be issued to a bank or a credit institution pursuant to Section 53
(1) sentence 1 or Section 53b (1) sentence 1 or (7) of the German
Banking Act, subject to the obligation to offer such shares
exclusively to employees of Munich Reinsurance Company and its
affiliated companies. Where legally permissible, the new shares may
also be issued to a third party, provided it is ensured from a
legal perspective that the shares will be offered to employees of
Munich Reinsurance Company or its affiliated companies. Shares
offered to employees may also be transferred at the end of a
vesting period or subject to a holding period.
Shareholders’ subscription rights shall be
excluded for this purpose. Where legally permissible, the employee
shares may also be issued in such a manner that the contribution to
be made for them is covered by that portion of the profit for the
year which the Board of Management and the Supervisory Board may
transfer to other revenue reserves pursuant to Section 58 (2) of
the Stock Corporation Act.
The Board of Management shall also be authorised, with the consent
of the Supervisory Board, to determine all other rights of the
shares and the terms of issue. Notwithstanding Section 60 (2) of
the Stock Corporation Act, the entitlement to dividend of the new
no-par-value shares can be determined.”
c) Cancellation of the authorisation of 20 April 2011
The authorisation granted by the Annual General Meeting on 20
April 2011 regarding Authorised Capital Increase 2011 pursuant to
Article 4 (2) of the Articles of Association, of which to date no
use has been made, shall be cancelled on this resolution becoming
effective through entry of the amendment to the Articles of
Association in accordance with b) in the Commercial Register.
Pursuant to Article 17, sentence 2 of the Articles of
Association of the Company, the Supervisory Board may authorise
members of the Board of Management to represent the Company alone.
This authorisation, which has been provided for in the Articles of
Association for over 50 years, has so far never been needed in
practice. Furthermore, the European
Commission’s Delegated Regulation (EU)
2015/35 supplementing the Solvency II Directive stipulates that
from 1 January 2016 at least two persons must effectively run an
undertaking. Significant decisions should therefore not be taken by
one person alone. Sentence 2 of Article 17 of the Articles of
Association should therefore be deleted.
Article 17 of the Articles of Association currently reads as
follows:
Any two members of the Board of Management, or one member jointly
with an employee vested with full commercial power of attorney,
shall be entitled to represent the Company. The Supervisory Board
may, however, authorise any individual member of the Board of
Management to represent the Company alone.
The Supervisory Board and the Board of Management propose that the
following resolutions be adopted:
Sentence 2 of Article 17 of the Articles of Association shall be
deleted.
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