Proposals for resolutions

  • Creation date: 25 March 2015
  • Last update: 25 March 2015

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71th Ordinary Shareholders‘ Meeting of Lenzing Aktiengesellschaft
Wednesday, April 22, 2015, 10:30 a.m.

I. Proposed resolution regarding agenda item 2:

Adopting a resolution on the use of the net profit shown in the 2014 annual financial statements

The Management Board and the Supervisory Board propose that the shareholders’ meeting adopts the following

Resolution

„The balance sheet profit as shown in the company’s annual financial statements as of December 31, 2014 in the amount of EUR 26,550,000 is to be distributed in accordance with the suggestion of the Management Board, as approved by the Supervisory Board, as follows:

  • A dividend of EUR 1 is to be assigned to every share that is entitled to a share in profits. The total amount of the dividend therefore amounts to EUR 26,550,000.
  • Payment date for these dividends is April 29, 2015

II. Proposed resolution regarding agenda item 3:

Adopting a resolution on discharge of the Members of the Management Board for the business year 2014

The Management Board and the Supervisory Board propose that the shareholders’ meeting adopts the following

Resolution

„The persons who served on the Management Board of Lenzing Aktiengesellschaft in business year 2014 are discharged from liability with regard to their managing activities during the relevant period.“

III. Proposed resolution regarding agenda item 4:

Adopting a resolution on discharge of the Members of the Supervisory Board for the business year 2014

The Management Board and the Supervisory Board propose that the shareholders’ meeting adopts the following 

Resolution

„The persons who served on the Supervisory Board of Lenzing Aktiengesellschaft in business year 2014 are discharged from liability with regard to their supervisory activities during the relevant period.“

IV. Proposed resolution regarding agenda item 5:

Adopting a resolution on the compensation of the members of the Supervisory Board for the business year 2014

The Management Board and the Supervisory Board propose that the shareholders’ meeting in accordance with Article 13 of the company's Articles of Incorporation and section 98 Stock Corporation Act adopts the following

Resolutions

  1. “The following table provides details regarding the compensation of members of the Supervisory Board for business year 2014:
    a. chairman of Supervisory Board: EUR 30,000
    b. vice-chairman of Supervisory Board: EUR 25.000,00
    c. each other member of the Supervisory Board: EUR 20,000
    d. chairman of the Audit Committee, the Strategy Committee and Finance
        Experts: EUR 5,000
    e. chairman of Nomination and remuneration Committee, as well as each  
        member of a Supervisory Board Committee: EUR 2,500.
  2. Each member of the Supervisory board receives attendance fee for each Supervisory Board meeting attended in business year 2014 in the amounting of EUR 1,000.
  3. Each committee member receives attendance fee for each committee meeting in business year 2014, unless the meeting is held on the same day as the Supervisory Board meeting, in the amounting of EUR 500.”

V. Proposed resolutions regarding agenda item 6:

Election of five members to the Supervisory Board

The Supervisory Board proposes that the shareholders’ meeting adopts the following

Resolutions

  1. „Mr. Felix Strohbichler, born on 27.05.1974, is elected as new member of the Supervisory Board of Lenzing Aktiengesellschaft. His term of office runs from the end of this shareholders’ meeting until the end of the shareholders‘ meeting that will decide on the discharge of the members of the Supervisory Board with regard to business year 2018.“
  2. „Mr. Veit Sorger, born on 10.06.1942, is reelected as member of the Supervisory Board of Lenzing Aktiengesellschaft. His term of office runs from the end of this shareholders’ meeting until the end of the shareholders‘ meeting that will decide on the discharge of the members of the Supervisory Board with regard to business year 2018.“
  3. Mr. Helmut Bernkopf, born on 10.05.1967 is reelected as member of the Supervisory Board of Lenzing Aktiengesellschaft. His term of office runs from the end of this shareholders’ meeting until the end of the shareholders‘ meeting that will decide on the discharge of the members of the Supervisory Board with regard to business year 2018.“
  4. Mr. Josef Krenner, born on 15.06.1952, is reelected as member of the Supervisory Board of Lenzing Aktiengesellschaft. His term of office runs from the end of this shareholders’ meeting until the end of the shareholders‘ meeting that will decide on the discharge of the members of the Supervisory Board with regard to business year 2018.“
  5. Ms. Astrid Skala-Kuhmann, born on 07.09.1953 is reelected as member of the Supervisory Board of Lenzing Aktiengesellschaft. His term of office runs from the end of this shareholders’ meeting until the end of the shareholders‘ meeting that will decide on the discharge of the members of the Supervisory Board with regard to business year 2018.“

Reasoning

Pursuant to Article 8 para 2 of the company's Articles of Incorporation, at least two members of the Supervisory Board shall yearly retire from office upon completion of the company's ordinary shareholders' meeting. The Supervisory Board members to retire are determined as follows: firstly, those members of the Supervisory Board whose term expires shall retire. If this is not the case for at least two members of the Supervisory Board, then such members of the Supervisory Board shall retire whose term of office has been the longest. If this is the case for more than two members of the Supervisory Board, then the lot has to decide on it. The lot also has to decide in such cases if pursuant to the foregoing the members of the Supervisory Board to be retiring from office have not been determined yet. Retired members of the Supervisory Board can be reelected immediately.

  1. Upon completion of the shareholders’ meeting dated April 22, 2015, Mr. Michael Junghans at his own request.
  2. Upon completion of the shareholders’ meeting dated April 22, 2015, Mr. Veit Sorger retires in accordance with Article 8 para 2 of the company's Articles of Incorporation.
  3. Upon completion of the shareholders’ meeting dated April 22, 2015, Mr. Helmut Bernkopf retires in accordance with Article 8 para 2 of the company's Articles of Incorporation.
  4. Upon completion of the shareholders’ meeting dated April 22, 2015, Mr. Josef Krenner retires in accordance with Article 8 para 2 of the company's Articles of Incorporation.
  5. Upon completion of the shareholders’ meeting dated April 22, 2015, Ms. Astrid Skala-Kuhmann retires in accordance with Article 8 para 2 of the company's Articles of Incorporation.

In order to maintain the status of nine elected members of the Supervisory Board, five members must be elected to the Supervisory Board on the upcoming shareholders’ meeting.

  1. The Supervisory Board therefore nominates Mr. Felix Strohbichler for new election to the Supervisory Board for a period that runs from the end of this shareholders’ meeting until the end of the shareholders meeting that will decide on the discharge of the members of the Supervisory Board with regard to business year 2018. Mr. Felix Strohbichler will support the Supervisory Board especially with his industry expertise.
  2. The Supervisory Board therefore nominates Mr. Veit Sorger for reelection to the Supervisory Board for a period that runs from the end of this shareholders’ meeting until the end of the shareholders meeting that will decide on the discharge of the members of the Supervisory Board with regard to business year 2018.
  3. The Supervisory Board therefore nominates Mr. Helmut Bernkopf for reelection to the Supervisory Board for a period that runs from the end of this shareholders’ meeting until the end of the shareholders meeting that will decide on the discharge of the members of the Supervisory Board with regard to business year 2018.
  4. The Supervisory Board therefore nominates Mr. Josef Krenner for reelection to the Supervisory Board for a period that runs from the end of this shareholders’ meeting until the end of the shareholders meeting that will decide on the discharge of the members of the Supervisory Board with regard to business year 2018.
  5. The Supervisory Board therefore nominates Ms. Astrid Skala-Kuhmann for reelection to the Supervisory Board for a period that runs from the end of this shareholders’ meeting until the end of the shareholders meeting that will decide on the discharge of the members of the Supervisory Board with regard to business year 2018.

Each of the suggested candidates has already presented statements within the meaning of section 87 para 2 Stock Corporation Act. Such statements are available on the company’s website as well.

Pursuant to section 87 para 3 Stock Corporation Act, it is intended to resolve separately on each vacant mandate in the upcoming shareholders’ meeting.

VI. Proposed resolution regarding agenda item 7:

Election of the auditor of the annual financial statements and consolidated financial statements for the business year 2015

According to the recommendation of its Audit Committee, the Supervisory Board proposes that the shareholders’ meeting adopts the following

Resolution

„Deloitte Audit Wirtschaftsprüfungs GmbH, Wien is appointed to be Auditor for the annual financial statements and the consolidated financial statements relating to business year 2015.“

VII. Proposed resolution regarding agenda item 8:

Adoption a resolution on authorized capital and on the corresponding amendment of article 4 of the company's articles of association

The Management Board and the Supervisory Board propose that the shareholders’ meeting adopts the following

Resolution

(3) The management board is authorized, pending the approval of the supervisory board, to raise the nominal capital of the company – if need be in several tranches – by up to EUR 13,778,412 by way of issuing up to 13,274,000 new no-par share certificates in bearer or registered form against cash and/or payment in kind. The management is authorized to determine the share type, the issue price and the terms and conditions of the issue. The authorization will come into effect with registration of the amendment at the company register and shall be valid for five years.

The shareholders' legal subscription rights may be acknowledged by the right of indirect subscription. In this case a credit institute or a consortium of credit institutes will be obligated to offer the convertible bonds to shareholders in proportion to their subscription rights. However, the management board, pending the approval of the supervisory board, is authorized to exclude fractional amounts from the subscription right, should these arise as a result of the subscription ratio.

Moreover, the management board is authorized, pending the approval of the supervisory board, to exclude the right to subscription arising from an increase in nominal capital from authorized capital against payment in kind for granting shares for acquiring companies, parts of companies or shares in companies.

The supervisory board is authorized to resolve on amendments to the company's articles of association resulting from the issue of shares from authorized capital."

Reasoning

Lenzing AG would like to continue to use its market opportunities and expand its leading market position through investments or acquisitions. To fund future growth the Management Board shell be authorized, subject to the approval of the Supervisory Board, to have an additional option to generate equity capital.

The resolution also authorizes the Management Board, subject to the approval of the Supervisory Board, to exclude the statutory subscription right for shareholders under the conditions mentioned in the invitation to the shareholders meeting. The advantage for the company is the ability to acquire other companies, parts of companies or shares of companies for own shares instead of a cash purchase price.

VIII. Proposed resolution regarding agenda item 9:

Authorizing the management board to issue, upon approval by the supervisory board, convertible bonds and on authorizing the management board, upon approval by the supervisory board, to exclude shareholders' subscription rights, either fully or in part, also in order to exclude fractional amounts from the subscription right

The Management Board and the Supervisory Board propose that the shareholders’ meeting adopts the following

Resolution

“The management board is authorized to issue, pending the approval of the supervisory board, convertible bonds – if need be in several tranches – which provide or allow for subscription or conversion rights to up to 13,274,000 shares of the company. The issue may be realized by means of the contingent capital to be approved and/or by means of owned shares. The management board, pending the approval of the supervisory board, shall determine the share type, the issue price and the terms and conditions of the issue. This authorization shall be valid until April 22, 2020.

The shareholders' legal subscription rights may be acknowledged by the right of indirect subscription. In this case a credit institute or a consortium of credit institutes will be obligated to offer the convertible bonds to shareholders in proportion to their subscription rights. However, the management board, pending the approval of the supervisory board, is authorized to exclude fractional amounts from the subscription right, should these arise as a result of the subscription ratio.

Moreover, the management board shall be authorized to exclude, pending the approval of the supervisory board, the right to subscription to convertible bonds if the management board, after due examination, has arrived at the conclusion that, the issue price of the convertible bond at the time of its finalization is not below the theoretical market price of the convertible bond as determined by the recognized methods of financial mathematics, that the conversion price or subscription price (issue price) of the shares offered under subscription has been determined by an approved pricing process applying the recognized methods of financial mathematics and the share price of the company's ordinary shares, and that this established price will not have been below the stock exchange quotation of the company's shares for twenty trading days before the day of the announcement of the convertible bond issue.”

Reasoning

Convertible bond issues are an alternative to simple cash capital increase. They provide the company with additional flexibility in financing.

Convertible bonds are, moreover, an alternative to conventional bonds.

The resolution will authorize the management board, pending the approval of the supervisory board, to issue convertible bonds and to exclude shareholders' subscription rights as detailed in the invitation to this shareholders' meeting. The advantage to the company will exist in faster placement of convertible bonds close to the market and therefore decreased risk of price and placement risk.

IX. Proposed resolution regarding agenda item 10:

Adopting a resolution on contingent capital and on corresponding amendment of article 4 of the company's articles of association

The Management Board and the Supervisory Board propose that the shareholders’ meeting adopts the following

Resolution

"(4) The nominal capital of the company is to be increased by the creation of contingent capital according to section 159 paragraph 2 Z 1 of the Austrian Stock Exchange Act by up to EUR 13,778,412. The contingent capital is to be raised by issuing up to 13,274,000 new no-par value individual share certificates to owners of convertible bonds. The management board has been authorized to this extent by the extraordinary shareholders' meeting of 22 April 2015. The increase in capital may only be implemented insofar as owners of convertible bonds exercise their right to subscription or conversion, or if those owners obligated to subscription or conversion fulfill their obligation, and if the management board decides to issue new shares to serve the owners' rights. The issue price and the conversion ratio are to be determined by applying the recognized methods of financial mathematics and the stock exchange quotation of the company's shares (basics of issue price calculation). The issue price must not be lower than the amount of the proportional share in nominal capital. The new shares to be issued of the contingent increase in capital bear full dividend entitlement for the year of issue. The management board, pending the approval of the supervisory board, is authorized to determine further details concerning the execution of the increase in capital by means of contingent capital. The supervisory board is authorized to amend the company's articles of association in accordance with the respective issue of shares under subscription. The corresponding authorization applies if the authority to issue conversion bonds has not been exercised and the authorization has expired or if contingent capital has not been employed and the time limits of the terms and conditions of the convertible bond issue have expired.

(5) The total number of actually or potentially issued shares under subscription under the terms and conditions of the conversion bond issue and the number of actually or potentially issued shares from contingent capital must not exceed 13,274,000 individual share certificates (limitation of authorized amount according to clause (3) and (4)). The subscription or conversion rights of owners must be maintained in any case."

Reasoning

In conjunction with the authorization of the management board to issue convertible bonds, a resolution on raising contingent capital for issuing new shares to owners of convertible bonds is required. This increase in nominal capital may only be realized insofar as owners of convertible bonds opt for executing their subscription or conversion rights and if the management decides to serve these rights by issuing new shares, or alternatively by providing owned shares.

X. Proposed resolution regarding agenda item 11:

Adopting a resolution on amendment of article 22 of the company’s articles of association (distribution of profits)

The Management Board and the Supervisory Board propose that the shareholders’ meeting adopts the following

Resolution

“The annual shareholder meeting shall decide the distribution of profits every year. The shareholder meeting may partially or completely exclude the net profit for the distribution of profits.”

Reasoning

The new version of the distribution of profits simplifies the articles of association and now corresponds to the usual form of articles of association for profit distribution. Furthermore the general meeting determines on the appropriation of profits, ie dividends or exclusion of distribution (carry forward to new accounts). For this reason, articles 22 is to be reformulated

This document is published in German and in a non-binding English convenience translation.