Prospectus-Final (clean) - Malta Financial Services Authority

majority holdings by 2 May 2015, on the basis of the authorisation resolution granted by theshareholders' meeting on 3 May 2010, make use of their option and/or conversion rights orb) those obligated as a result of bonds with warrants, convertible bonds, profit participationrights and/or participating bonds (or combinations of these instruments) which are issued orguaranteed by Deutsche Telekom AG or its direct or indirect majority holdings by 2 May 2015,on the basis of the authorisation resolution granted by the shareholders' meeting on 3 May2010, fulfill their option or conversion obligationsand other forms of fulfillment are not used. The new shares participate in profits starting at thebeginning of the financial year in which they are issued as the result of the exercise of any option orconversion rights or the fulfillment of any option or conversion obligations. Deutsche Telekom'sSupervisory Board is authorised to amend § 5 (5) of the Articles of Incorporation in accordance withthe particular usage of the contingent capital and after the expiry of all the option or conversionperiods.Shareholder Remuneration PolicyOn 24 February 2010, Deutsche Telekom's Board of Management and Supervisory Board decided topursue a shareholder remuneration policy for the 2010 to 2012 financial years that consists of anannual dividend of at least EUR 0.70 per share and market repurchases from time-to-time of its sharesto the extent necessary to achieve a total shareholder remuneration of around EUR 3.4 billion perannum. The implementation of this policy is subject to the availability of sufficient distributable balancesheet profits of Deutsche Telekom AG for the financial year in question and Deutsche Telekom'sability to establish the necessary reserves for any share repurchases. It is also contingent uponDeutsche Telekom's governing bodies adopting resolutions to this effect, taking into account thecompany's situation at the time.Share Repurchase ProgramIn connection with this policy, Deutsche Telekom's annual shareholders' meeting resolved on 12 May2011 to authorise the Board of Management to repurchase shares representing a total share capital ofup to EUR 1,106,257,716.74 by 11 November 2012. The shares to be repurchased on the basis of thisauthorisation, when included with the other shares of Deutsche Telekom's company which DeutscheTelekom already purchased and still possessed or were to be assigned to it under § 71d and § 71e ofthe German Stock Corporation Act, could not at any time account for more than 10% of DeutscheTelekom's share capital. Moreover, the requirements under § 71 (2) sentences 2 and 3 of the GermanStock Corporation Act must be complied with. In addition, shares shall not be repurchased for thepurpose of trading in treasury shares.This authorisation may be exercised in full or in part. The purchase can be carried out in partialtranches spread over various purchase dates within the authorisation period until the maximumpurchase volume is reached. Dependent Group companies of Deutsche Telekom AG within themeaning of § 17 of the German Stock Corporation Act or third parties acting for the account ofDeutsche Telekom AG or for the account of dependent Group companies of Deutsche Telekom AGwithin the meaning of § 17 of the German Stock Corporation Act are also entitled to purchase theshares. The shares shall be purchased through the stock exchange in adherence to the principle ofequal treatment (§ 53a of the German Stock Corporation Act). Shares can also be purchased bymeans of a public purchase or share exchange offer addressed to all shareholders, which, subject to asubsequently approved exclusion of the right to offer shares, must also comply with the principle ofequal treatment.The shares are to be used for one or several of the purposes permitted by the authorisation grantedby the shareholders' meeting on 12 May 2011. The shares may also be used for purposes for whichan exclusion of subscription rights is intended, but can also be withdrawn or sold through the stockmarket or by way of an offer to all shareholders. The shares may be used to fulfill the rights ofDeutsche Telekom's Board of Management members to receive shares, which the Supervisory Boardhas granted to these members as part of the arrangements governing the compensation of the Boardof Management, on the basis of a decision by the Supervisory Board to this effect.Pursuant to this authorisation, the Board of Management decided on 27 May 2011 and 20 September2011 to purchase a total of 316,000 shares for a total price of EUR 3 million, with an averagepurchase price of EUR 8.74 per share. These repurchases were executed on 6 June 2011 and121