Siemens 2015 Annual Report Download - page 56

Combined Management Report

shares is covered by that part of the annual net income which
the Managing Board and the Supervisory Board may allocate to
other retained earnings under Section  para.  of the German
Stock Corporation Act.
Furthermore, the Managing Board is authorized to increase,
with the approval of the Supervisory Board, the capital stock
until January ,  by up to € . million through the
issuance of up to . million registered shares of no par value
against cash contributions and / or contributions in kind
( Authorized Capital ).
As of September , , the total unissued authorized capital
of Siemens AG therefore consisted of € . million nominal
that may be issued, with varying terms by issuance, in install-
ments of up to . million registered shares of no par value.
By resolutions of the Shareholders’ Meetings of January ,
 and January , , the Managing Board is authorized to
issue bonds with conversion rights or with warrants attached,
or a combination of these instruments, each entitling the
holders to subscribe to up to  million registered shares of
Siemens AG of no par value. Based on these two authorizations
the Company or consolidated subsidiaries of the Company
may issue bonds until January ,  and January , ,
respectively, each in an aggregate principal amount of up to
€  billion. In order to grant shares of stock to holders / creditors
of such convertible bonds or warrant bonds, the capital stock
was conditionally increased by resolutions of the Shareholders’
Meetings  and , each by up to  million registered
shares of no par value (Conditional Capitals  and ), i. e.
in total by up to €  million through the issuance of up to
 million shares of no par value.
The new shares under Authorized Capital  and the bonds
under these authorizations are to be issued against cash or
non-cash contributions. They are, as a matter of principle, to be
offered to shareholders for subscription. The Managing Board is
authorized to exclude, with the approval of the Supervisory
Board, subscription rights of shareholders in the event of capi-
tal increases against contributions in kind. In the event of cap-
ital increases against contributions in cash, the Managing
Board is authorized to exclude shareholders’ subscription
rights with the approval of the Supervisory Board in the follow-
ing cases:
>
The issue price of the new shares / bonds is not significantly
lower than the stock market price of the Siemens shares
already listed or the theoretical market price of the bonds
computed in accordance with generally accepted actuarial
methods (exclusion of subscription rights, limited to  % of
the capital stock, in accordance with or by mutatis mutandis
application of Section  para.  sentence  German Stock
Corporation Act).
>
The exclusion is necessary with regard to fractional amounts
resulting from the subscription ratio.
>
The exclusion is necessary in order to grant holders of con-
version or option rights or conversion or option obligations
on Siemens shares a compensation for the effects of dilution.
The total amount of new shares issued or to be issued under
Authorized Capital  or in accordance with the bonds men-
tioned above, in exchange for contributions in cash and in kind
and with shareholders’ subscription rights excluded, may in
certain cases be subject to further restrictions, such as the
restriction that they may not exceed  % of the capital stock.
The details of those restrictions are described in the relevant
authorization.
In February , Siemens issued bonds with warrant units
with a volume of US$  billion. Siemens exchanged the major
part of the warrants issued in  against new warrants in
September ; for this purpose, Siemens issued new bonds
with warrants. At exchange, the new warrants resulted in op-
tion rights entitling their holders to receive approximately
. million Siemens shares. The terms and conditions of the
warrants enable Siemens to service exercised option rights
using either conditional capital or treasury stock, and also
enable Siemens to buy back the warrants.
The Company may not repurchase its own shares unless so
authorized by a resolution duly adopted by the shareholders at
a general meeting or in other very limited circumstances set
forth in the German Stock Corporation Act. On January ,
, the Shareholders’ Meeting authorized the Company to
acquire until January ,  up to  % of its capital stock ex-
isting at the date of adopting the resolution or – if this value is
lower – as of the date on which the authorization is exercised.
The aggregate of shares of stock of Siemens AG repurchased
under this authorization and any other Siemens shares previ-
ously acquired and still held in treasury by the Company or at-
tributable to the Company pursuant to Sections d and e of
the German Stock Corporation Act may at no time exceed  %
of the then existing capital stock. Any repurchase of Siemens
shares shall be accomplished at the discretion of the Managing
Board either () by acquisition over the stock exchange or
() through a public share repurchase offer. The Managing
Board is additionally authorized to complete, with the approval
of the Supervisory Board, the repurchase of Siemens shares in
accordance with the authorization described above by using
certain derivatives (put and call options, forward purchases
and any combination of these derivatives). In exercising this
authorization, all stock repurchases based on the derivatives
are limited to a maximum volume of  % of Siemens’ capital