Reebok 2012 Annual Report Download - page 170

adidas Group
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2012 Annual Report
Group Management Report – Financial Review
148
2012
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03.2
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Group Business Performance
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Disclosures pursuant to § 315 Section 4 and § 289 Section 4 of the German Commercial Code
Executive Board appointment and dismissal
Pursuant to § 6 of the Articles of Association and § 84 AktG, the
Supervisory Board is responsible for determining the number of
members of the Executive Board, for their appointment and dismissal
as well as for the appointment of the Chief Executive Officer (CEO).
Currently, the adidas AG Executive Board comprises the CEO as well
as three further members
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SEE EXECUTIVE BOARD, P. 40. Executive Board
members may be appointed for a maximum period of five years. Such
appointments may be renewed and the terms of office may be extended,
provided that no term exceeds five years.
The Supervisory Board may revoke the appointment of an individual
as member of the Executive Board or CEO for good cause, such as
gross negligence of duties or a vote of no confidence by the Annual
General Meeting. As adidas AG is subject to the regulations of the
German Co-Determination Act (Mitbestimmungsgesetz – MitbestG),
the appointment of Executive Board members and also their dismissal
requires a majority of at least two thirds of the Supervisory Board
members (§ 31 MitbestG). If such a majority is not established in the first
vote by the Supervisory Board, the Mediation Committee has to present
a proposal which, however, does not exclude other proposals. The
appointment or dismissal is then made in a second vote with a simple
majority of the votes cast by the Supervisory Board members. Should
the required majority not be established in this case either, a third vote,
again requiring a simple majority, must be held in which, however, the
Chairman of the Supervisory Board has two votes.
Furthermore, the Fuerth, Germany, local court shall, pursuant to § 85
section 1 AktG, in urgent cases, make the necessary appointment upon
application by any party involved, if the Executive Board does not have
the required number of members.
Amendments to the Articles of Association
Pursuant to § 179 section 1 sentence 1 AktG, the Articles of Association
of adidas AG can, in principle, only be amended by a resolution passed
by the Annual General Meeting. Pursuant to § 21 section 3 of the Articles
of Association in conjunction with § 179 section 2 sentence 2 AktG,
the Annual General Meeting of adidas AG principally resolves upon
amendments to the Articles of Association with a simple majority of the
votes cast and with a simple majority of the nominal capital represented
when passing the resolution. If mandatory legal provisions stipulate
a larger majority of voting rights or capital, this is applicable. When it
comes to amendments solely relating to the wording, the Supervisory
Board is, however, authorised to make these modifications in accordance
with § 179 section 1 sentence 2 AktG in conjunction with § 10 section 1 of
the Articles of Association.
Authorisation of the Executive Board to issue shares
The authorisations of the Executive Board are regulated by §§ 76 et seq.
AktG in conjunction with § 7 of the Articles of Association. The Executive
Board is responsible, in particular, for managing the company and
represents the company judicially and extra-judicially.
The authorisation of the Executive Board to issue shares is regulated by
§ 4 of the Articles of Association and by statutory provisions:
Authorised Capital
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Until June 21, 2014, the Executive Board is authorised to increase the
nominal capital, subject to Supervisory Board approval, by issuing
new shares against contributions in cash once or several times by no
more than € 50,000,000 altogether (Authorised Capital 2009/I).
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Until July 4, 2014, the Executive Board is authorised to increase the
nominal capital, subject to Supervisory Board approval, by issuing
new shares against contributions in kind once or several times by no
more than € 25,000,000 altogether (Authorised Capital 2011).
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Until July 12, 2015, the Executive Board is authorised to increase the
nominal capital, subject to Supervisory Board approval, by issuing
new shares against contributions in cash once or several times by no
more than € 20,000,000 altogether (Authorised Capital 2010).
Subject to Supervisory Board approval, shareholders’ subscription
rights may be excluded in certain cases for each of the above-mentioned
authorisations
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SEE NOTE 26, P. 221.
Contingent Capital
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Based on the resolution by the Annual General Meeting of May 6,
2010, the Executive Board is authorised, subject to Supervisory Board
approval, to issue bonds with warrants and/or convertible bonds by
the company or affiliated companies once or several times in the total
amount of up to € 1.5 billion, with or without a limited term, against
contributions in cash and to accept guarantee of such bonds issued
by affiliated companies until May 5, 2015. Furthermore, the Executive
Board is authorised, subject to Supervisory Board approval, to grant
to bondholders or bond creditors subscription or conversion rights
relating to no more than a total of 36,000,000 shares in compliance
with the corresponding conditions of the bonds.
For this purpose, the nominal capital was conditionally increased by
up to € 36,000,000 (Contingent Capital 2010). The Executive Board
is authorised, subject to Supervisory Board approval, to exclude
shareholders’ subscription rights for fractional amounts. The
authorisation also provides for excluding shareholders’ subscription
rights insofar as this is necessary for granting subscription rights
to which holders or creditors of bonds already issued before are
entitled. Furthermore, the Executive Board is authorised, subject
to Supervisory Board approval, to also exclude shareholders’
subscription rights if the issue price of the bonds is not significantly
below the market value of these bonds and the number of shares to
be issued does not exceed 10% of the nominal capital. The issuance of
new shares or the use of treasury shares must be taken into account
when calculating the limit of 10% in certain specific cases.