pdf (22.8 MB) - METRO Group

METRO GROUP : ANNUAL REPORT 2011 : BUSINESS
→ GROUP MANAGEMENT REPORT : 9. NOTEs PURsUANT TO § 315 sEcTiON 4 Of ThE GERMAN cOMMERciAl cOdE
ANd ExPlANATORy REPORT Of ThE MANAGEMENT BOARd
the Frankfurt stock exchange during a period of several days
before or after the exercise of warrant or conversion rights is
announced for the number of ordinary shares which would
otherwise be delivered. This period is to be determined by the
Management Board. The terms of the bonds may also state
that the warrant or convertible bonds may, at MeTRo aG’s
option, be converted into existing ordinary shares in
MeTRo aG or shares in another exchange-listed company, in
lieu of conversion into new ordinary shares from contingent
capital, and that warrant rights or obligations can be fulfilled
through the delivery of such shares.
The terms of the bonds may also call for a warrant or conversion
obligation at the end of the term (or at any other time), or
authorise MeTRo aG to grant bond holders ordinary shares in
MeTRo aG or shares in another exchange-listed company
upon maturity of bonds carrying warrant or conversion rights
(including bonds which mature due to termination), in whole or
in part, in lieu of a maturity payment in cash. The percentage of
share capital represented by the ordinary shares in MeTRo aG
issued upon the exercise of warrant or conversion rights may
not exceed the par value of the bonds. §§ 9 section 1, 199 section
2 of the German stock Corporation act apply.
The Management Board is authorised, with the consent of the
supervisory Board, to determine the further details pertaining
to the issuance and terms of the bonds, particularly the
coupon, issue price, term, division into shares, rules for the
protection against dilution and the warrant or conversion
period, or to define such details in consultation with the corporate
officers of the affiliate of MeTRo aG which issues the
warrant or convertible bonds.
The authorisations to issue bonds are designed to expand
MeTRo aG’s financing leeway and to provide the Company
with flexible and short-term access to financing upon the
emergence of favourable capital market conditions, in par-
→ p. 152
ticular. Issues of bonds with conversion or warrant rights
on shares of MeTRo aG provide a means of raising capital
at attractive conditions. The convertible and warrant premiums
attained flow to the Company. The additionally foreseen
possibility of not only granting conversion and warrant
rights, but also introducing warrant and conversion obligations,
and allowing the Company to opt for the full or partial
redemption of bonds with own shares rather than cash,
extends the Company’s leeway in the design of this financing
instrument.
Fundamental agreements related to the
conditions of a takeover (§ 315 section 4 No. 8 of
the german Commercial Code)
as a borrower, MeTRo aG is currently a party to two syndicated
loan agreements that the lender may cancel in the case
of a takeover inasmuch as the credit rating of MeTRo aG also
and as a result of the takeover drops in a way stipulated in the
contract. The requirements of a takeover are, first, that the
shareholders who controlled MeTRo aG at the time when
each contract was signed lose this control. The second
requirement is the takeover of control of MeTRo aG by one or
several parties. The lending banks may cancel the contract
and demand the return of the loan only if the takeover and a
resulting drop in the credit rating occur cumulatively. The
regulations as described here are common market practice
and serve the purpose of creditor protection. In 2011, these
loans were not utilised.
Compensation agreements in case of a takeover
(§ 315 section 4 No. 9 of the german Commercial
Code)
no compensation agreements with the members of the Management
Board or employees have been concluded with a
view to takeover offers.