Siemens 2013 Annual Report Download - page 150

92 A. To our Shareholders 117 B. Corporate Governance
118 B. Corporate Governance Report
124 B. Corporate Governance statement pursuant to
Section 289a of the German Commercial Code
(part of the Combined Management Report)
126 B.3 Compliance Report
129 B.4 Compensation Report
(part of the Combined Management Report)
148 B.5 Takeover-relevant information (pursuant to
Sections 289 para. 4 and 315 para. 4 of the
German Commercial Code) and explanatory report
(part of the Combined Management Report)

€15 billion with conversion rights or with warrants attached,
or a
combination of these instruments, entitling the holders to
subscribe
to up to 200 million new registered shares of Siemens
AG of no par value, representing a pro rata amount of up to €600
million of the capital stock. The bonds under this authoriza-
tion are to be issued against cash or non-cash contributions.
Additionally, by resolution of the Annual Shareholders’ Meet-
ing of January 25, 2011, the Managing Board is authorized until
January 24, 2016 to issue bearer or registered bonds in an ag-
gregate principal amount of up to €15 billion with conversion
rights or with bearer or registered warrants attached or a com-
bination of these instruments, entitling the holders to sub-
scribe to up to 90 million new registered shares of Siemens AG
of no par value, representing a pro rata amount of up to €270
million of the capital stock. The bonds under this authoriza-
tion are to be issued against cash contributions.
For further details of the authorizations please refer to the re-
spective resolutions of the Annual Shareholders’ Meetings. In
particular, the bonds are, as a matter of principle, to be offered
to shareholders for subscription, including the possibility of
issuing them to banks with the obligation that they must be
offered to shareholders for subscription. However, the Manag-
ing Board is authorized to exclude shareholders’ subscription
rights with the approval of the Supervisory Board (1) provided
that the issue price of the bonds is not significantly lower than
their theoretical market price computed in accordance with
generally accepted actuarial methods, (2) to the extent the ex-
clusion is necessary with regard to fractional amounts result-
ing from the subscription ratio, (3) in order to grant holders of
conversion or option rights or conversion or option obligations
on Siemens shares subscription rights as compensation for the
effects of dilution, and (4) to the extent that bonds were is-
sued against non-cash contributions, in particular within the
context of business combinations or when acquiring compa-
nies or interests therein.
In order to grant shares of stock to holders of convertible
bonds or warrant bonds issued until January 25, 2015 by the
Company or any of its consolidated subsidiaries in accordance
with the authorization of the Managing Board adopted by the
Annual Shareholders’ Meeting on January 26, 2010, the capital
stock was conditionally increased by €600 million through the
issuance of up to 200 million no-par value shares registered in
the names of the holders (Conditional Capital 2010). In order to
grant shares of stock to holders or creditors of convertible
bonds or warrant bonds issued until January 24, 2016 by the
Company or any of its consolidated subsidiaries in accordance
with the authorization of the Managing Board adopted by the
Annual Shareholders’ Meeting on January 25, 2011, the capital
stock was conditionally increased by €270 million through the
issuance of up to 90 million no-par value shares registered in
the names of the holders (Conditional Capital 2011).
The total of the shares to be issued on the basis of bond issues
under these authorizations pursuant to Section 186 para. 3 sen-
tence 4 of the German Stock Corporation Act, in combination
with other shares issued or sold by direct or mutatis mutandis
application of this statutory regulation during the effective
period of these authorizations, does not exceed 10% of the capi-
tal stock at the date of using these authorizations. This limit also
includes shares of stock issued up to this point in time against
non-cash contributions, under exclusion of shareholders’ sub-
scription rights, on the basis of the Authorized Capital 2009. In
addition, the issue of convertible bonds and / or warrant bonds
pursuant to both authorizations shall be limited to convertible
bonds and / or warrant bonds that entitle or oblige to subscribe
to a maximum number of 200 million Siemens shares represent-
ing a pro rata amount of €600 million of the capital stock while
both authorizations are simultaneously effective.
In February 2012 Siemens issued bonds with warrant units
with a volume of US$3 billion. The bonds with warrant units
with a minimum per-unit denomination of US$250,000 were
offered exclusively to institutional investors outside the U.S.
Pre-emptive rights of Siemens shareholders were excluded.
The bonds issued by Siemens Financieringsmaatschappij N.V.
are guaranteed by Siemens AG and complemented with war-
rants issued by Siemens AG. The warrants entitle their holders
to receive Siemens shares against payment of the exercise
price in Euros. At issuance, the warrants resulted in option
rights relating to a total of about 21.7 million Siemens shares.
The terms and conditions of the warrants enable Siemens to
service exercised option rights also by delivering treasury
stock as well as to buy back the warrants. The bonds with war-
rant units were issued in two tranches with maturities of 5.5
and 7.5 years, respectively. The maturities refer to both the
bonds and the related warrants. After issuance, the warrants
can be detached from the bonds, the option period com-
menced on March 28, 2012. The bonds with warrant units, the
bonds detached from warrants and the warrants detached are
listed by Deutsche Bank AG in the Open Market segment of the
Frankfurt Stock Exchange (Freiverkehr).