Vistaprint 2011 Annual Report Download - page 105

authorized ordinary shares for any purpose. However, in the ordinary course of our business, we may
determine from time to time that the issuance of authorized and unissued shares is in the best interests of
Vistaprint, including in connection with equity compensation or future acquisitions or financings.
At the annual meeting, we are asking our shareholders to renew the authority of our Management Board,
with the approval of our Supervisory Board, until November 3, 2016 to issue, and to grant rights to purchase
or subscribe for, our unissued ordinary shares up to a maximum of our authorized share capital and to issue,
and to grant rights to purchase or subscribe for, our unissued preferred shares equal to 100% of the number of
ordinary shares outstanding at the time of issue. This authority to issue shares is similar to that generally
afforded under state law to public companies domiciled in the United States. Management believes that
retaining the flexibility to issue shares for acquisitions, financings or other business purposes in a timely
manner without first obtaining specific shareholder approval is important to our continued growth. Further-
more, our ordinary shares are listed on the NASDAQ Global Select Market, and the issuance of additional
shares will remain subject to NASDAQ rules. In particular, NASDAQ requires shareholder approval for the
issuance of shares in excess of 20% of the shares outstanding, with several exceptions.
If our shareholders do not renew the Management Board’s authority, then the previous authorization
would remain in place, and we would continue to issue our shares and grant rights to purchase or subscribe
for our shares pursuant to that authorization until it expires on August 28, 2014.
Our Management Board and Supervisory Board recommend that you vote FOR the renewal of the
authorization of the Management Board and Supervisory Board to issue our ordinary shares and preferred shares.
PROPOSAL 8 — RENEWAL OF AUTHORIZATION TO EXCLUDE OR RESTRICT
SHAREHOLDERS’ PREEMPTIVE RIGHTS
Under Dutch law, holders of our ordinary shares (other than our employees who are issued ordinary
shares pursuant to awards granted under our equity compensation plans) would generally have a pro rata
preemptive right of subscription to any of our ordinary shares issued for cash. A preemptive right of
subscription is the right of our current shareholders to maintain their percentage ownership of Vistaprint’s
shares by buying a proportional number of any new shares that Vistaprint issues. However, Dutch law and our
articles of association permit our shareholders to authorize our Management Board, with the approval of our
Supervisory Board, to exclude or restrict these preemptive rights. This authorization may not continue for
more than five years, but may be given on a rolling basis. We currently have authorization from our
shareholders to exclude or restrict these preemptive rights, which authorization expires on August 28, 2014,
and it is common practice for Dutch companies to seek to renew this authorization annually on a rolling basis.
At the annual meeting, we are asking our shareholders to renew the authority of our Management Board,
with the approval of our Supervisory Board, until November 3, 2016 to exclude or restrict preemptive rights.
Preemptive rights are uncommon for public companies domiciled in the United States. We believe that if
we are not granted the authority to limit preemptive rights, our ability to raise capital through sales of our
securities would be significantly affected because shareholders’ exercise of their preemptive rights would cause
delays in a transaction and may dissuade potential buyers of our securities from entering into a transaction
with us. Any limits or waivers of preemptive rights would apply equally to all holders of our ordinary shares.
Furthermore, as long as our ordinary shares remain listed on the NASDAQ Global Select Market, any issuance
of ordinary shares will remain subject to NASDAQ rules, including limitations on our ability to issue shares
without shareholder approval. See Proposals 6 and 7 above for a discussion of the NASDAQ rules regarding
share issuances.
If our shareholders do not renew the Management Board’s authority, then the previous authorization
would remain in place, and we could continue to exclude or restrict preemptive rights pursuant to that
authorization until it expires on August 28, 2014.
Our Management Board and Supervisory Board recommend that you vote FOR the renewal of the
authorization of the Management Board and Supervisory Board to exclude or restrict our shareholders’
preemptive rights under Dutch law.
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