APC 2006 Annual Report Download - page 179

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dates at a manageable level, the Company’s Manage-
ment Board may decide to require two or more super-
visory boards to consult together and to jointly desig-
nate one or two candidates.
Candidates for election as the representative of
employee shareholders on the Supervisory Board
must be employed under a contract that qualifies them
to sit on the Supervisory Board for a four-year term
and must hold at least 25 Schneider Electric SA
shares or an equivalent number of units in a mutual
fund invested in the Company’s shares.
The representative of employee shareholders’ term
shall end and he or she will be considered as having
resigned if he or she is no longer (i) an employee of the
Group, (ii) a shareholder or holder of units in a mutual
fund invested in the Company’s shares, or (iii) a mem-
ber of the supervisory board of the mutual fund that
proposed him or her as a candidate. The representa-
tive’s term shall also end if employees hold less than
3% of the issued capital at the end of the financial year.
A representative of employee shareholders will be
elected to the Supervisory Board for the first time in
accordance with this amendment to the bylaws at the
Annual General Meeting to be held to approve the
2007 financial statements, if applicable.
We are also submitting an amendment to the bylaws
providing for the direct election of a member of the
Supervisory Board by the employees of the Company
and its direct or indirect subsidiaries that have their
registered office in France.
We ask you to vote against this resolution, which has
not been approved by the Management Board but that
must be submitted to the General Meeting in accor-
dance with the French Commercial Code. Under the
French Commercial Code, if the General Meeting is
asked to amend the bylaws to provide for the represen-
tation of employee shareholders on the Supervisory
Board, as in the seventh resolution, it must also vote
on a resolution providing for the direct election of a
Supervisory Board member by employees of the Com-
pany and its subsidiaries in France.
Authorizations to increase the
capital with or without pre-emptive
subscription rights - ninth, tenth,
eleventh and twelfth resolutions -
We are tabling resolutions to renew authorizations
granted to the Management Board to increase the
capital.
You have authorized the Management Board to issue
shares, shares with equity warrants, convertible
bonds, stand-alone equity warrants and other share
equivalents, with or without pre-emptive subscription
rights.
Acting on this authorization, the Management Board
has announced that it will carry out a 1 billion share
issue with pre-emptive subscription rights to finance
part of the acquisition of US-based APC. This acquisi-
tion, which was finalized on February 14, 2007, has
made Schneider Electric the global leader in critical
power.
Because the authorizations will expire during the year,
we ask you to renew authorizations to increase the
capital with or without pre-emptive subscription rights
for a period of 26 months, as provided for in Article
L.225-192-2 of the French Commercial Code.
In the ninth resolution, you are asked to authorize the
Management Board to issue, in France or abroad,
common shares or legally recognized securities that
are convertible, redeemable, exchangeable or other-
wise exercisable for shares, in all cases with pre-emp-
tive subscription rights. This authorization would also
cover the raising of the par value of existing shares, to
be paid up by capitalizing reserves, earnings, or addi-
tional paid-in capital.
The aggregate par value of the issued securities may
not exceed 1.5 billion. The issued share capital may
be increased during the period by a maximum aggre-
gate amount of 500 million, or 62.5 million shares.
This ceiling does not include an increase in the par
value of existing shares paid up by capitalizing
reserves, earnings or additional paid-in capital, nor
does it include the par value of any shares to be issued
to prevent dilution of the rights of holders of share
equivalents.
The 500 million ceiling takes into account authorized
capital increases without pre-emptive subscription
rights.
In the tenth resolution, your are asked to authorize the
Management Board to issue the above shares and
share equivalents without pre-emptive subscription
rights for existing shareholders on the French or inter-
national market.
This authorization may be used to issue shares of the
Company on conversion, redemption, exchange or
exercise of share equivalents issued by Schneider
Electric SA’s direct or indirect subsidiaries with the
Management Board’s agreement.
The aggregate par value of securities issued in accor-
dance with this resolution may not exceed 1.5 bil-
lion. The issued share capital may be increased dur-
ing the period by a maximum aggregate amount of
300 million, or 37.5 million shares. The ceilings set
in this resolution and the ninth resolution would not be
cumulative.
The eleventh resolution authorizes the Management
Board to increase the number shares to be issued in
application of the ninth or tenth resolutions if the issues
are oversubscribed. The supplementary capital
increase that may be made within 30 days after the ini-
tial subscription period closes may not exceed 15% of
the original increase and must be carried out at the
same price.
The twelfth resolution authorizes the Management
Board to issue shares or share equivalents within the
ceilings set in the preceding resolutions in payment of
shares of another company tendered to a public
exchange offer initiated by Schneider Electric. In
accordance with the new measures in the Commercial
Code, the Management Board may also issue shares
or share equivalents representing, in the aggregate, a
maximum of 10% of the Company's issued capital, in
payment for shares or share equivalents contributed to
the Company.
The purpose of these authorizations is to give the
Management Board of Directors greater flexibility
when it comes to selecting the type of issues to be car-
ried out, depending on demand and the conditions
prevailing in the French, foreign or international finan-
cial markets.
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