Decision on Article 10 of the Takeover Directive
The following information and explanations relate to the provisions of the Decree of 5 April 2006 implementing Article 10 of Directive number 2004/25/EC of the European Parliament and the Council of the European Union dated 21 April 2004.
> Table 59 may be used as a reference for the company’s capital structure. No rights apart from those arising under statute are attached to the shares into which the company’s capital is divided, apart from the scheme specified in Article 31 of the Articles of Association concerning the application of the profit in relation to Class B and Class F preference shares.
A brief summary of Article 31 of the Articles of Association is provided below. From the profit realised in any financial year, an amount will first be distributed, where possible, on the Class B cumulative preference shares, calculated by applying the percentage stated below to the amount that must be paid up on those shares as at the start of the financial year for which the distribution is made. The percentage referred to above will be equal to the average of the Euribor rates for money market loans with a maturity of twelve months – weighted according to the number of days for which these rates prevailed – during the financial year for which the distribution is made, plus one percentage point. Euribor refers to the Euro Interbank Offered Rate as determined and published by the European Central Bank.
Subsequently, if possible, a dividend will be distributed on each financing preference share of a certain series, with due consideration of the provisions of Article 31(6) of the Articles of Association, equal to an amount calculated by applying a percentage to the nominal amount of the financing preference share concerned at the start of that financial year, plus the amount of share premium paid in on the financing preference share issued in the series concerned at the time of initial issue of the financing preference shares of that series, less the amount paid out on each financing preference share concerned and charged to the share premium reserve formed at the time of issue of the financing preference shares of that series prior to that financial year. If and to the extent that a distribution has been made on the financing preference shares concerned in the course of the year and charged to the share premium reserve formed at the time of issue of the financing preference shares of the series concerned, or partial repayment has been made on such shares, the amount of the distribution will be reduced pro rata over the period concerned according to the amount of the distribution charged to the share premium reserve and/or the repayment with respect to the amount referred to in the preceding sentence.
The calculation of the dividend percentage for the financing preference shares of a certain series will be made for each of the series of financing preference shares referred to below, in the manner set forth for the series concerned.
Series FP1 to FP4
The dividend percentage will be calculated by taking the arithmetic mean of the yield to maturity on euro government loans issued by the Kingdom of the Netherlands with a remaining term matching as closely as possible the term of the series concerned, as published in the Euronext Prices Lists, plus two percentage points.
Series FP5 to FP8
The dividend percentage will be equal to the average of the Euribor rates for money market loans with a maturity of 12 months – weighted according to the number of days for which these rates prevailed – during the financial year for which the distribution is made, plus two percentage points.
The above percentages may be increased or reduced by an amount of no more than 300 basis points.
The above percentages apply for the following periods: series FP1 and FP5: five years; series FP2 and FP6: six years; series FP3 and FP7: seven years and series FP4 and FP8: eight years. After a period expires, the percentage will be modified in accordance with the rules laid down in Article 31 paragraph 6(c) of the Articles of Association.
The Supervisory Board shall determine, on the basis of a proposal by the Executive Board, what part of the profit remaining after application of the above provisions will be added to the reserves. The part of the profit that remains thereafter is at the disposal of the General Meeting, subject to the provision that no further dividends will be distributed on the preference shares and with due consideration of the other provisions of Article 31 of the Articles of Association.
Please note that, as at the balance sheet date, neither preference shares B nor preference shares F have been issued.
Limits on the transfer of shares
The company has no limitation, under the Articles of Association or by contract, on the transfer of shares or depositary receipts issued with the company’s cooperation, apart from the restriction on the transfer of preference shares contained in the Articles of Association. Article 13 of the company’s Articles of Association stipulates that approval is required from the company’s Executive Board for the transfer of Class B preference shares. The scheme is included in order to offer the company the facility – because of the specific purpose of issuing these shares, namely the acquisition of finance or achieving protection – of offering the holders of these shares an alternative in the event that they wish to dispose of their shares.
As regards the Class B preference shares, the company and Stichting Aandelenbeheer BAM Groep (BAM Group Stock Management Foundation) have agreed that the company will not proceed to issue these shares or to grant any rights to purchase them to anyone other than the said foundation without the foundation’s permission. The foundation will not dispose of or encumber any Class B preference shares, nor renounce the voting rights relating to them, without permission from the company. Please refer to page 209 onward of the report with regard to the reasons behind protecting the company and the manner in which this is done.
The company is aware of the following interests in its equity, which are now reported under the provisions concerning the reporting of controlling interests under the Disclosure of the Financial Supervision Act. See > table 61.
Special control rights
The shares into which the company’s equity is divided are not subject to any special control rights.
Employee share plan or employee option plan
The company does not have any employee share or employee option plans. Since this year a long term incentive plan based on performance shares has been introduced for the members of the Executive Board, which replaces the previous long term incentive plan which was based on phantom shares. The new long term incentive plan is cascaded down to a maximum number of 15 senior executive positions below the Executive Board.
Each share in the company provides entitlement to the casting of one vote at shareholders’ meetings. There are no restrictions on the exercising of voting rights. The company’s Articles of Association contain the usual provisions in relation to intimation for the purpose of being acknowledged as a proxy at shareholders’ meetings. Where the company’s Articles of Association mention holders of depositary receipts or depositary receipt holders, whether named or bearer, this is understood to mean holders of depositary receipts issued with the company’s cooperation and also individuals who, under the terms of Articles 88 or 89, Book 2 of the Dutch Civil Code, have the rights accorded to holders of depositary receipts for shares issued with the company’s cooperation.
The company is not aware of any agreements involving one of the company’s shareholders and which might provide reasons for:
(i) restricting the transfer of shares or of depositary receipts issued with the company’s cooperation, or
(ii) restricting the voting rights.
Appointment and dismissal of members of the Supervisory Board and members of the Executive Board
The company is obliged by law to operate a mitigated two-tier structure. The General Meeting appoints the members of the Supervisory Board, based on a recommendation from the Supervisory Board. The General Meeting also appoints the members of the Executive Board, with the Supervisory Board having the right of recommendation. The section headed Corporate governance on page 80 onwards of the report by the Executive Board provides a more detailed explanation of the appointment and dismissal of members of the Supervisory Board and members of the Executive Board.
Powers of the Executive Board
The company is managed by an Executive Board. The Executive Board’s powers are those arising from legislation and regulations. A more detailed description of the Executive Board’s duties can be found on page 80 onwards of the Executive Board’s report, in the section headed Corporate governance. The Executive Board was authorised by the General Meeting held on 22 April 2015 to issue ordinary shares and Class F preference shares and/or to grant options to purchase these shares, subject to approval from the Supervisory Board. This authorisation is limited in duration to eighteen months. It is also limited in scope to 10 per cent of the issued capital, plus an additional 10 per cent, which additional 10 per cent may be used exclusively for mergers, acquisitions or strategic partnerships by the company or by operating companies. The General Meeting held on 22 April 2015 granted authority to the Executive Board for a period of eighteen months to repurchase shares in the company, within the limitations imposed by the law and the Articles of Association and subject to the approval of the Supervisory Board. In principle, the General Meeting is asked to grant these authorisations every year. Resolutions to amend the Articles of Association, or to dissolve the company may only be passed by the General Meeting on the basis of a proposal put forward by the Executive Board and approved by the Supervisory Board.
Change of control provisions in important agreements
The Group’s most important financial rules state that in the event of a change of control (including in the event that more than 50 per cent of the shares in BAM are deemed to be held by one party), the banks may terminate further financing and the Group can be obliged to repay outstanding loans under these arrangements and to extend the capital base provided for outstanding bank guarantees. A change of control clause is not unusual in important collaboration agreements over a longer period, where the parties include parts of the Group. Partly because of the total size of the Group, these clauses are not considered significant within the meaning of the Decree on Article 10 of the Takeover Directive.
Change of control clauses in contracts of employment
No agreement has been concluded with directors or employees of the company providing for a severance payment on termination of employment resulting from a public bid for the company.