TomTom 2011 Annual Report Download - page 28

TomTom Annual Report and Accounts 2011
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rights to subscribe for preference shares to the Foundation,
may have the effect of preventing, discouraging or delaying an
unsolicited attempt to obtain (de facto) control and may help us
to strengthen our position in relation to a bidder and its plans,
and to seek alternatives. Currently there are no preference shares
outstanding but a call option to issue preference shares is in place.
Composition of continuity foundation
The Board of the Foundation appoints the Board members in
accordance with the Foundation’s Articles of Association. The Board
consists of three members, Mick den Boogert, Robert de Bakker
and Frans Koffrie. The Management Board of the company and
the Board of the Foundation declare that they are jointly of the
opinion that the Foundation is independent from the company.
Protection mechanism
Foundation Continuity TomTom
The company has granted the Foundation a call option (the Call
Option), entitling it to subscribe for preference shares, equal to a
maximum of 50% of the aggregate issued and outstanding share
capital (excluding issued and outstanding preference shares) of
the company at the time of issue. The issue of preference shares in
this manner would cause substantial dilution to the voting power
of any shareholder whose objective was to gain control of the
company.
Management Board authority to issue additional
preference shares
In addition to the Call Option, the Management Board has the
authority to issue preference shares. The Management Board
believed that there might be circumstances under which the
Management Board and the Supervisory Board would feel that
the issue of additional preference shares could be required in the
interest of the company and its stakeholders. For instance, the
number of preference shares the Foundation can acquire might
not be suffi cient. Also the situation could occur whereby the
Foundation has already exercised its Call Option and subsequently
the preference shares have been cancelled. As with the instrument
in place for the Foundation, any possible issuances of preference
shares will be temporary and subject to the company’s Articles of
Association and the legislation on takeovers.
As mentioned above, during the Annual General Meeting held
in April 2011, a resolution was passed to extend the authority of
the Management Board to issue preference shares and to grant
rights to subscribe for such shares until 29 October 2012, which
authority is limited to 50% of the aggregate outstanding share
capital (excluding issued and outstanding preference shares) of the
company at the time of issue.
The authorisation of the Management Board to restrict or exclude
pre-emptive rights pertaining to the (rights to subscribe for)
preference shares was extended until 29 October 2012 at the
Annual General Meeting of Shareholders in April 2011.
Pursuant to the Articles of Association, a resolution of our
Management Board to issue preference shares, or to grant
rights to subscribe for preference shares, as a result of which
the aggregate nominal value of the issued preference shares will
exceed 50% of the issued capital of ordinary shares at the time
of issue, will at all times require the prior approval of the General
Meeting of Shareholders.
Upon the issue of preference shares, subscribers for preference
shares must pay at least 25% of the nominal value of the
preference shares. Each transfer of preference shares requires
the approval of the Management Board and Supervisory Board.
No resolution of the General Meeting of Shareholders or the
Management Board is required for an issue of preference shares
pursuant to the exercise of a previously granted right to subscribe
for preference shares (including the right of the Foundation to
acquire preference shares pursuant to the Call Option).
The issue of preference shares is meant to be temporary. Unless
the preference shares have been issued by a vote of the General
Meeting of Shareholders, our Articles of Association require that
a General Meeting of Shareholders be held within six months
after the issue of preference shares to consider their purchase
or withdrawal. If at this General Meeting of Shareholders no
resolution on the purchase or withdrawal of the preference shares
is adopted, a General Meeting of Shareholders will be held every
six months thereafter for as long as preference shares remain
outstanding.
Obligations of shareholders to disclose holdings
—
Under the Financial Markets Supervision Act any person who,
directly or indirectly, acquires or disposes of an interest in the
capital and/or the voting rights of a limited liability company,
incorporated under Dutch law with an offi cial listing on a stock
exchange within the European Economic Area, or a company
organised under the laws of a state that is not a member of
the European Union or party to the European Economic Area
with an offi cial listing on NYSE Euronext Amsterdam, must give
written notice of such acquisition or disposal if, as a result of such
acquisition or disposal, the percentage of capital interest and/or
voting rights held by such a person meets, exceeds or falls below
one of the following thresholds: 5%, 10%, 15%, 20%, 25%,
30%, 40%, 50%, 60%, 75% and 95% of a company’s issued
and outstanding share capital. Such notifi cation must be given to
the Dutch securities regulator (Autoriteit Financiële Markten, the
‘AFM’) without delay.
Under the Financial Markets Supervision Act, we are required to
inform the AFM immediately if our issued and outstanding share
Corporate Governance | continued