TomTom 2013 Annual Report Download - page 24

The company's Articles of Association were amended at the 2013
Annual General Meeting following changes in Dutch corporate law.
The capital structure
The company's authorised share capital amounts to €180,000,000
and is divided in 600,000,000 ordinary shares with a nominal value
of €0.20 each and 300,000,000 preferred shares, with a nominal
value of €0.20 each. On 31 December 2013, a total of 222,176,212
ordinary shares were issued and outstanding.
Issue of shares
The Management Board has the power to issue shares or grant
rights to subscribe for shares if so designated by the General
Meeting or the company's Articles of Association. This
Management Board resolution is subject to the prior approval of
the Supervisory Board. No resolution of the General Meeting or the
Management Board is required for an issue of shares pursuant to
the exercise of a previously granted right to subscribe for shares.
The Management Board continues to believe it is in the company's
best interests that it should be in a position to react promptly when
business opportunities arise that require the issue of ordinary
shares. When such occasions arise, the Management Board
therefore wishes to be authorised to issue ordinary shares and to
grant rights to subscribe for such shares without the need to obtain
prior approval from company shareholders at an Extraordinary
General Meeting. Such meetings take time to convene and could
generate disruptive market speculation.
In April 2013, the Annual General Meeting passed a resolution
extending the Management Board's authorisation to resolve to
issue ordinary shares or grant rights to subscribe for such shares
until 23 October 2014. This authority is limited to 10% of the
number of issued ordinary shares for general purposes (or limited
to 20% in case of a merger or acquisition) and to restrict or exclude
the pre-emption rights for existing shareholders for such issue or
grant of rights.
Separately, the Management Board has been authorised to grant
rights to subscribe for ordinary shares and to restrict or exclude the
pre-emption rights for existing shareholders for those rights, up to
3,650,000 ordinary shares for the purpose of executing the
TomTom Employee Stock Option Plan and the Management Board
Stock Option Plan. The authorisation was subject to the prior
approval of the Supervisory Board. It was granted for a period
starting from the 2013 Annual General Meeting and ending with
the Annual General Meeting to be held in 2014.
In addition to the authorisations referred to above, the
Management Board has been authorised by the 2012 Annual
General Meeting to issue preferred shares or to grant rights to
subscribe for preferred shares and to restrict or exclude existing
shareholders' pre-emption rights for those rights. The authorisation
was subject to the prior approval of the Supervisory Board and
applied until 26 October 2013. For further information on this
authority of the Management Board, see the protection mechanism
section below.
Repurchase by the company of its own shares
The 2013 Annual General Meeting has resolved to authorise the
Management Board to acquire shares in the capital of the company
up to 10% of the issued share capital. The authorisation was
granted for a period of 18 months, and will be in effect until 23
October 2014.
Protection mechanism
Foundation Continuity TomTom
A foundation, the Stichting Continuïteit TomTom (the Foundation),
was established on 26 May 2005 to act as an instrument that
protects the company against hostile takeovers. The purpose of the
Foundation is to safeguard the company's interests and those of its
subsidiaries, as well as the interests of all stakeholders of the
organisation. It does so by ensuring that the company is in a
position to resist influences which could affect its independence,
continuity and/or corporate identity in any manner that would be
in contravention of the interests of the company or its stakeholders.
The company has granted the Foundation a call option (the Call
Option) entitling it to subscribe for preferred shares. The authority
is limited to 50% of the aggregate outstanding share capital
(excluding issued and outstanding preferred shares) of the
company at the time of issue. An issue of preferred shares in the
manner described would cause substantial dilution of the voting
power of any shareholder whose objective was to gain control of
the company.
In addition to the Call Option, a resolution was passed during the
2012 Annual General Meeting to extend the authority of the
Management Board until 26 October 2013 to issue preferred shares
and to grant rights to subscribe for such shares equal to fifty per
cent (50%) of the aggregate nominal value of the outstanding
ordinary shares at the time of issue and to restrict or exclude the
pre-emption rights for existing shareholders.
In the General Meeting in 2013, the Management Board did not
request a further extension of the aforementioned authority but
proposed to grant the Foundation the right to subscribe for
additional preferred shares up to hundred per cent (100%) of the
aggregate nominal value of the outstanding ordinary shares at the
time of issue, up to a maximum of the number of preferred shares
included in the authorised capital at the time of issue.
This proposal was adopted by the General Meeting on 23 April
2013 and the Management Board waived all its rights under the
Corporate Governance / Continued
ANNUAL REPORT AND ACCOUNTS 2013 / 24