Henkel Annual Report 2011 - Henkel AG & Co. KGaA Annual Report ...

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Group management report
Corporate governance
• It holds both the power of representation and
executive powers over the legal relationships
prevailing between the corporation and Henkel
Management AG, the Personally Liable Partner.
• It exercises the voting rights of the corporation in
the General Meeting of Henkel Management AG.
• It issues rules of procedure incumbent upon
Henkel Management AG (Section 278 (2) AktG) in
conjunction with Sections 114 and 161 HGB and
Articles 8, 9 and 26 of the Articles of Association.
Capital stock denominations / Shareholder rights
The capital stock of the corporation amounts
to 437,958,750 euros. It is divided into a total of
437,958,750 bearer shares of no par value, of
which 259,795,875 are ordinary bearer shares
(nominal proportion of capital stock: 259,795,875
euros or 59.3 percent) and 178,162,875 are preferred
bearer shares (nominal proportion of capital
stock: 178,162,875 euros or 40.7 percent). All the
shares are fully paid up.
Each ordinary share grants to its holder one vote.
The preferred shares accord to their holders all
shareholder rights apart from the right to vote.
Unless otherwise resolved in General Meeting,
the profit attributable to shareholders of Henkel
AG & Co. KGaA is distributed as follows: First,
the holders of preferred shares receive a preferred
dividend in the amount of 0.04 euros per preferred
share. The holders of ordinary shares then
receive a preliminary dividend of 0.02 euros per
ordinary share, with the residual amount being
distributed to the holders of ordinary and
preferred shares in accordance with the proportion
of the capital stock attributable to them
(Art. 35 (2) of the Articles of Association). If the
preferred dividend is not paid out either in part
or in whole in a year, and the arrears are not paid
off in the following year together with the full
preferred share dividend for that second year, the
holders of preferred shares are accorded voting
rights until such arrears are paid (Section 140 (2)
AktG). Cancellation or limitation of this preferred
dividend requires the consent of the holders of
preferred shares (Section 141 (1) AktG).
There are no shares bearing cumulative/plural
voting rights, preferential voting rights or maximum
voting rights (voting restrictions).
The shareholders exercise their rights in General
Meeting as per the relevant statutory provisions
and the Articles of Association of Henkel AG &
Co. KGaA. In particular, they may exercise their
Henkel Annual Report 2011
right to vote – either personally, by postal vote,
through a legal representative or through a proxyholder
nominated by the company – and are also
entitled to speak on agenda items, ask relevant
questions and propose reasonable motions.
Unless otherwise required by mandatory provisions
of statute or the Articles of Association, the
resolutions of the General Meeting are adopted
by simple majority of the votes cast and, inasmuch
as a majority of shares is required by statute, by
simple majority of the voting stock represented
(Art. 24 of the Articles of Association). This also
applies to changes in the Articles of Association.
However, modifications to the object of the
company require a three-quarters’ majority
(Section 179 (2) AktG).
Approved capital / Share buy-back
According to Art. 6 (5) of the Articles of Association,
there is an authorized capital limit. Acting within
this limit, the Personally Liable Partner is
authorized, subject to the approval of the Supervisory
Board and of the Shareholders’ Committee,
to increase the capital stock of the corporation
in one or several acts until April 18, 2015, by up to
a total of 25,600,000 euros through the issue
for cash of new preferred shares with no voting
rights. All shareholders are essentially assigned
pre-emptive rights. However, these may be
set aside in three cases: (1) in order to dispose
of fractional amounts; (2) to grant to creditors/
holders of bonds with warrants or conversion
rights or a conversion obligation issued by the
corporation or one of the companies dependent
upon it, pre-emptive rights corresponding to
those that would accrue to such creditors/bondholders
following exercise of their warrant or
conversion rights or on fulfillment of their conversion
obligations; or (3) if the issue price of the
new shares is not significantly below the quoted
market price at the time of issue price fixing.
In addition, the Personally Liable Partner is
authorized to purchase ordinary and/or preferred
shares of the corporation at any time until April
18, 2015, up to a maximum nominal proportion of
the capital stock of 10 percent. This authorization
can be exercised for any legal purpose. To the
exclusion of the pre-emptive rights of existing
shareholders, treasury shares may, in particular,
be transferred to third parties for the purpose
of acquiring entities or participating interests
in entities. Treasury shares may also be sold
for cash, provided that the purchase price is not