Philips 2008 Annual Report Download - page 259

Meetings are convened by public notice, via the Company's website
or other electronic means of communication and by letter or by the
use of electronic means of communication, to registered shareholders.
Extraordinary General Meetings of Shareholders may be convened
by the Supervisory Board or the Board of Management if deemed
necessary and must be held if shareholders jointly representing at
least 10% of the outstanding share capital make a written request to
that effect to the Supervisory Board and the Board of Management,
specifying in detail the business to be dealt with. The agenda of the
General Meeting of Shareholders shall contain such business as may
be placed thereon by the Board of Management or the Supervisory
Board, and agenda items will be explained where necessary in writing.
In accordance with the articles of association and Dutch law, requests
from shareholders for items to be included on the agenda will generally
be honored, subject to the Company’s rights to refuse to include the
requested agenda item under Dutch law, provided that such requests
are made in writing at least 60 days before a General Meeting of
Shareholders to the Board of Management and the Supervisory Board
by shareholders representing at least 1% of the Company’s outstanding
capital or, according to the official price list of Euronext Amsterdam,
representing a value of at least 50 million euros. Written requests
may be submitted electronically and shall comply with conditions
stipulated by the Board of Management, which conditions are posted
on the Company's website.
Main powers of the General Meeting of Shareholders
All outstanding shares carry voting rights. The main powers of the
General Meeting of Shareholders are to appoint, suspend and dismiss
members of the Board of Management and of the Supervisory Board,
to adopt the annual accounts, declare dividends and to discharge the
Board of Management and the Supervisory Board from responsibility
for the performance of their respective duties for the previous financial
year, to appoint the external auditor as required by Dutch law, to adopt
amendments to the articles of association and proposals to dissolve
or liquidate the Company, to issue shares or rights to shares, to restrict
or exclude pre-emptive rights of shareholders and to repurchase or
cancel outstanding shares. Following common corporate practice in
the Netherlands, the Company each year requests limited authorization
to issue (rights to) shares, to restrict or exclude pre-emptive rights
and to repurchase shares. In compliance with Dutch law, decisions of
the Board of Management that are so far-reaching that they would
greatly change the identity or nature of the Company or the business
require the approval of the General Meeting of Shareholders. This
includes resolutions to (a) transfer the business of the Company, or
almost the entire business of the Company, to a third party (b) enter
into or discontinue long-term cooperation by the Company or a
subsidiary with another legal entity or company or as a fully liable
partner in a limited partnership or ordinary partnership, if this
cooperation or its discontinuation is of material significance to the
Company or (c) acquire or dispose of a participating interest in the
capital of a company to the value of at least one third of the amount
of the assets according to the balance sheet and notes thereto or, if
the Company prepares a consolidated balance sheet, according to the
consolidated balance sheet and notes thereto as published in the last
adopted annual accounts of the Company, by the Company or one of
its subsidiaries. Thus the Company applies principle IV.1 of the Dutch
Corporate Governance Code within the framework of the articles
of association and Dutch law and in the manner as described in this
corporate governance report.
The Board of Management and Supervisory Board are also accountable,
at the Annual General Meeting of Shareholders, for the policy on
the additions to reserves and dividends (the level and purpose of the
additions to reserves, the amount of the dividend and the type of
dividend). This subject is dealt with and explained as a separate agenda
item at the General Meeting of Shareholders. Philips aims for a
sustainable and stable dividend distribution to shareholders in the
long term. A resolution to pay a dividend is dealt with as a separate
agenda item at the General Meeting of Shareholders.
The Board of Management and the Supervisory Board are required
to provide the General Meeting of Shareholders with all requested
information, unless this would be prejudicial to an overriding interest
of the Company. If the Board of Management and the Supervisory
Board invoke an overriding interest in refusing to provide information,
reasons must be given. If a serious private bid is made for a business
unit or a participating interest and the value of the bid exceeds a
certain threshold (currently one third of the amount of the assets
according to the balance sheet and notes thereto or, if the Company
prepares a consolidated balance sheet, according to the consolidated
balance sheet and notes thereto as published in the last adopted annual
accounts of the Company), and such bid is made public, the Board of
Management shall, at its earliest convenience, make public its position
on the bid and the reasons for this position.
Repurchase and issue of (rights to) own shares
The 2008 General Meeting of Shareholders has resolved to authorize
the Board of Management, subject to the approval of the Supervisory
Board, to acquire shares in the Company within the limits of the articles
of association and within a certain price range until September 27,
2009. In view of the Company’s plans to repurchase and cancel up
to approximately EUR 5 billion worth of its own shares, the 2008
General Meeting of Shareholders resolved to renew this authorization,
each time the cancellation of a tranche of shares has become effective.
The renewed authorization allows the Board of Management to
purchase additional shares in the Company up to 10% of the number
of shares issued by the Company at the time the relevant tranche
of shares has been cancelled. All repurchases of shares under any
renewed authorization are subject to the same terms of the original
authorization referred to above and any renewed authorization shall
expire on September 27, 2009.
In addition, the 2008 General Meeting of Shareholders resolved to
authorize the Board of Management, subject to the approval of the
Supervisory Board, to issue shares or grant rights to acquire shares
in the Company as well as to restrict or exclude the pre-emption
right accruing to shareholders until September 27, 2009. The latter
authorization is limited to a maximum of 10% of the number of shares
issued plus 10% of the issued capital in connection with or on the
occasion of mergers and acquisitions.
Logistics of the General Meeting of Shareholders
and provision of information
Introduction
The Company may set a registration date for the exercise of the voting
rights and the rights relating to General Meetings of Shareholders.
Shareholders registered at such date are entitled to attend the meeting
and to exercise the other shareholder rights (in the meeting in question)
notwithstanding subsequent sale of their shares thereafter. This date
will be published in advance of every General Meeting of Shareholders.
Shareholders who are entitled to attend a General Meeting of
Shareholders may be represented by proxies.
Information which is required to be published or deposited pursuant
to the provisions of company law and securities law applicable to the
Company, is placed and updated on the Company’s website, or hyperlinks
are established. The Board of Management and Supervisory Board
shall ensure that the General Meeting of Shareholders is informed
by means of a ‘shareholders circular’ published on the Company’s
website of facts and circumstances relevant to the proposed resolutions.
Resolutions adopted at a General Meeting of Shareholders shall be
recorded by a civil law notary and co-signed by the chairman of the
meeting; such resolutions shall also be published on the Company’s
website within one day after the meeting. A summary of the discussions
during the General Meeting of Shareholders, in the language of the
meeting, is made available to shareholders, on request, no later than
three months after the meeting. Shareholders shall have the opportunity
to respond to this summary for three months, after which a final
summary is adopted by the chairman of the meeting in question.
Such summary shall be made available on the Company’s website.
Philips was one of the key companies in
the establishment of the Shareholders
Communication Channel
Proxy voting and the Shareholders Communication Channel
Philips was one of the key companies in the establishment of the
Shareholders Communication Channel, a project of Euronext
Amsterdam, banks in the Netherlands and several major Dutch
companies to simplify contacts between a participating company
and shareholders that hold their shares through a Dutch securities
account with a participating bank. The Company uses the Shareholders
Communication Channel to distribute a voting instruction form for
the Annual General Meeting of Shareholders. By returning this form,
shareholders grant power to an independent proxy holder who
will vote according to the instructions expressly given on the voting
instruction form. The Shareholders Communication Channel can also
be used, under certain conditions, by participating Philips shareholders
to distribute - either by mail or by placing it on the Company’s or
Shareholders Communication Channel's website - information directly
related to the agenda of the General Meeting of Shareholders to other
participating Philips shareholders.
Philips Annual Report 2008 259
254
Corporate governance
250
Reconciliation of
non-US GAAP information
262
Ten-year overview
266
Investor information