Articles of Association
as of December 14, 2011
Overview
I. General Provisions
II. Share Capital and Shares
III. Board of Management
IV. Supervisory Board
V. General Shareholders' Meeting
VI. Appropriation of the Profit for the Year
Section 1
The company is named “Software Aktiengesellschaft”.
Its registered office is in Darmstadt.
Section 2
The Company's objects are the generation and commercial exploitation of data processing solutions and of all other products from the realm of data processing, including the provision of all associated services.
The Company can take all actions which are appropriate to achieve its objects. It may establish other businesses and may acquire, and acquire participations in, other businesses of the same or similar type. The Company may also limit its commercial activities to a portion of the fields of operations referenced in section 1 hereof.
Section 3
The company’s financial year is the calendar year.
Section 4
The company publishes its notices in the electronic Federal Gazette only, to the extent that mandatory statutory provisions do not prescribe another form of publication.
The company may also transmit information to the holders of its admitted securities by means of electronic media. Mandatory provisions of law shall remain unaffected by the foregoing.
II. SHARE CAPITAL AND SHARES
Section 5
The share capital amounts to € 86,827,845.
It is divided into 86,827,845 no par bearer shares.
The registered share capital is conditionally increased by up to € 6,160,338 (nominal),which is divided into up to 6,160,338 no par bearer shares, each share representing a pro rata share of the registered share capital equal to € 1 (Conditional Capital 2008). The sole purpose of the conditional capital increase is to grant subscription rights (options) to members of the Software AG Executive Board as well as other managers of Software AG and its subordinate affiliated enterprises, including members of management bodies both inside and outside of Germany in accordance with the shareholder resolution dated April 29, 2008. The conditional capital increase will be implemented only to the extent to which the options are exercised in accordance with this conditional capital. The new shares will carry dividend rights from the beginning of the fiscal year in which they are issued.
The registered share capital is conditionally increased by up to € 18,000,000, divided into 18,000,000 shares of bearer shares with each share representing a pro rata amount of the registered share capital of € 1. The conditional capital increase shall be carried out only to the extent that the holders of the option or conversion rights or the persons, who are obligated to exercise the conversion or option duties under warrant-linked or convertible bonds, which are issued or guaranteed by Software AG or a wholly-owned direct or indirect subsidiary of Software AG on the basis of the authorization resolution adopted by the Shareholders' Meeting on May 21, 2010 , enforce their option or conversion rights or discharge a duty to exercise a warrant or convert the bonds (also in the case where the Company enforces a corresponding elective right), and to the extent no cash compensation is paid or treasury shares are used for purposes of satisfying such obligations. The new shares will be issued in each case at the option or conversion price determined in accordance with the aforementioned authorization resolution. The new shares will have dividend rights beginning in the fiscal year in which they are created. The Executive Board is authorized, with the consent of the Supervisory Board, to prescribe additional details regarding the implementation of the conditional capital increase.
The registered share capital of the Company shall be conditionally increased by up to an additional amount of € 750,000, divided into up to 750,000 bearer shares having a pro rata amount of the registered share capital of € 1 per share. The conditional capital increase serves to grant no-par bearer shares upon the exercise of conversion or option rights, which were granted by the IDS Scheer AG pursuant to the authorizations given by the IDS Scheer AG shareholders on April 29, 1999 or on May 20, 2005, and for which the Company has granted rights of equivalent value within the meaning of § 23 UmwG. The conditional capital increase will be carried out only to the extent that the holders of the conversion or option rights make use of their right to exercise them after the merger of IDS Scheer AG into the Company becomes effective and only to the extent that no cash compensation is paid and no treasury shares are issued as consideration. The new shares will have dividend rights as of the commencement of the fiscal year in which they participate in the profits as a result of exercising the conversion or option rights. The Executive Board is authorized, with the consent of the Supervisory Board, to stipulate more details regarding the implementation of the conditional capital increase.
The Executive Board is authorized, on or before May 4, 2016 and subject to the consent of the Supervisory Board, to increase the registered share capital either once or multiple times by up to a total of € 43,074,091 by issuing new no-par-value bearer shares in return for cash and/or non-cash (in-kind) capital contributions (Authorized Capital). In so doing, the number of shares must be increased in the same ratio as the registered share capital. The shareholders shall be granted preemptive rights. The new shares may also be underwritten by one or more banks, subject to the obligation that offer them for subscription to the shareholders of the Company. However, the Executive Board may exclude the preemptive rights of the shareholders in the following listed cases:
(1) The Executive Board is authorized, subject to the consent of the Supervisory Board, to exclude fractional amounts from the preemptive rights of the shareholders.
(2) The Executive Board is authorized, subject to the consent of the Supervisory Board, to exclude the shareholders’ preemptive rights in cases of capital increases in return for non-cash capital contributions, if the non-cash capital contribution is made for the purpose of acquiring companies, parts of companies and/or equity interests in companies or made in connection with business combinations.
(3) The Executive Board is authorized, subject to the consent of the Supervisory Board, to exclude the preemptive rights in cases of capital increases in return for cash contributions to the extent necessary to grant to owners of option rights or convertible rights from warrant bonds or convertible bonds which were issued by Software AG or a wholly-owned direct or indirect subsidiary of Software AG, or owners of option rights or conversion rights under which Software AG is obligated following the merger of IDS Scheer AG into Software AG, a preemptive right to new shares to the extent to which they would be entitled as shareholders after exercising the option or conversion right or after fulfillment of the option or conversion obligation.
(4) The Executive Board is authorized, subject to the consent of the Supervisory Board, to exclude the preemptive rights in cases of capital increases in return for cash contributions if the capital increases approved on the basis of this authorization do not exceed a total of 10% of the registered share capital, as it exists either at the time of the adoption of the resolution by the General Shareholders’ Meeting or - where this amount is lower - at the time of the relevant exercise of the authorization and provided that the issue value is not significantly lower than the stock exchange price. The maximum limit of 10% of the registered share capitals shall be reduced by the pro rata amount of the registered share capital which is allotted to those treasury shares of the Company that are sold during the term of the Authorized Capital to the exclusion of the shareholders‘ preemptive rights pursuant to §§ 71 para. 1 no. 8 sentence 5, 186 para. 3 sentence 4 AktG The maximum limit shall be reduced further by the pro rata amount of the registered share capitals which is allotted to those shares that are issued to service warrant bonds or convertible bonds, provided that the bonds are issued during the term of the Authorized Capital to the exclusion of the preemptive right under the mutatis mutandis application of § 186 para. 3 sentence 4 AktG.
The sum of the shares issued pursuant to this authorization to the exclusion of the preemptive right in return for cash and non-cash contributions may not exceed a pro rata share of the registered share capital of € 17,229,636 (equals 20% of the current registered share capital). The Executive Board is authorized, subject to the consent of the Supervisory Board, to determine the additional details of the capital increase and the terms and conditions of the stock issue.
Section 6
The Executive Board will determine the form the share certificates, profit-participation and renewal coupons will take. The shareholder’s claim to evidenced shares is excluded.
III. EXECUTIVE BOARD
Section 7
The Executive Board will comprise several members. The number of members of the Executive Board is determined by the Supervisory Board. The Supervisory Board can also appoint alternate members of the Executive Board and issue standing orders for the Executive Board.
Section 8
The company is represented by two members of the Executive Board jointly or by one member of the Executive Board together with an authorized signatory.
The Supervisory Board may, by special resolution, authorize representation by one person in certain circumstances. In addition, it may release a member of the Executive Board from the restrictions prescribed by Section 181 BGB (German Civil Code) by special resolution.
IV. SUPERVISORY BOARD
Section 9
The Supervisory Board consists of twelve members, six of whom shall be elected by the General Shareholders' Meeting and six of whom by the employees, pursuant to the provisions of the Employee Co-determination Act [Mitbe¬stimmungs¬gesetz] of 4 May 1976 (MitbestG).
Each member of the Supervisory Board may resign from office upon one month's notice, with or without good cause.
The General Shareholders' Meeting shall appoint members of the Supervisory Board, with respect to whom it is not bound to vote in accordance with any nomination, for a term of office that ends no later than in the year in which the General Shareholders' Meeting is held following the Supervisory Board member's reaching his or her 70th birthday.
Section 10
Pursuant to the provisions of § 27 (1 and 2) of the German Employee Co-determination Act [Mitbestimmungsgesetz], the Supervisory Board shall elect from its midst a Chairman and a Deputy-Chairman. The Deputy-Chairman shall have the same rights and duties of the Chairman only where the Chairman is prevented from acting and where not otherwise provided by law or these Articles; the Deputy-Chairman is not entitled to cast a second vote. Unless a shorter term of office is prescribed in connection with their election, the term of office of the Chairman of the Supervisory Board and his Deputy depends on their current term of office as members of the Supervisory Board. Re-election is permissible if the member concerned is reappointed as a member of the Supervisory Board.
Section 11
The Chairman or his Deputy shall call the Supervisory Board's meetings, complying with a one-week period of notice, and, if possible, giving information on the agenda.
The Chairman of the Supervisory Board shall preside at its meetings. The Chairman of the Supervisory Board shall determine the order in which the items of the agenda shall be dealt with and the manner and order of any voting. He may postpone deliberation and adoption of resolutions on individual items on the agenda, or on all of them, for a maximum of four weeks, where an unequal number of members of shareholder and employee representatives would participate in adoption of the resolution or where there are other material grounds for the postponement.
The Supervisory Board's resolutions shall be adopted by a simple majority of votes cast, unless another voting majority is mandated by law. In the event of a tie, the Chairman shall determine whether a new vote shall be taken on the matter and whether that new vote should take place at this meeting or one of the next meetings of the Supervisory Board. Where a second vote on the same matter results again in a deadlock, the Chairman shall be entitled to cast two votes.
The Supervisory Board has a quorum to pass resolutions where at least half the number of members it is required to have take part in the adoption of the resolution. A member shall also be deemed to take part in the adoption of the resolution where he or she abstains from voting. Absent members may take part in the adoption of a resolution by having another member submit their written ballot on their behalf.
The Supervisory Board is permitted to adopt resolutions by written ballot, telephonic voting or by the use of other telecommunications media, where the Supervisory Board's Rules of Procedure (Geschäftsordnung) so provide or the Chairman of the Supervisory Board so rules in an individual case. Pursuant to the rulings of the Chairman of the Supervisory Board, it is also possible for resolutions to be adopted partly at the meeting and partly outside the meeting ("mixed voting procedure").
Declarations of intent by the Supervisory Board are given on its behalf by the Chairman of the Supervisory Board or by a member authorized by him.
Section 12
The Executive Board may only implement certain business transactions with the prior approval of the Supervisory Board. These transactions are specified in the by-laws for the Executive Board.
The Supervisory Board is empowered to pass resolutions on changes to the articles of association which relate only to the wording thereof.
Section 13
In addition to the committee prescribed by § 27 (3) MitbestG, the Supervisory Board may create further committees from its midst. To the extent permitted by law, the Supervisory Board may delegate decision-making authority to the committees.
The composition, authorities and procedures of the committees shall be determined by the Supervisory Board. Where the Supervisory Board does not prescribe any rule, § 11 of these Articles of Association shall apply with respect to the procedures to be followed by the committees.
Section 14
Members of the Supervisory Board will receive, in addition to refunds of their expenses, a fixed amount of remuneration (payable after the end of the financial year) which will be decided upon each year by the General Shareholders’ Meeting.
V. GENERAL SHAREHOLDERS’ MEETING
Section 15
The General Shareholders’ Meeting which resolves on the approval of the actions of the Executive Board and the Supervisory Board, the appropriation of the profit, the appointment of the auditors of the annual financial statements and, if appropriate, the approval of the annual financial statements, will take place within the first six months of each financial year.
Section 16
Subject to the statutory rights of the Supervisory Board and of a minority of shareholders to call a meeting, the General Shareholders' Meeting is called by the Executive Board upon the statutory notice periods applicable in each case.
The General Shareholders' Meeting shall take place at the Company's registered office or at the registered office of a German stock exchange.
Video and audio transmission of the General Shareholders' Meeting is permissible. The Chairman is authorized to permit the General Shareholders' Meeting to be transmitted, either in whole or in part, via audio and video in such manner as he may prescribe in a more detailed fashion.
Section 17
Shareholders who wish to participate in and vote at the General Shareholders' Meeting must register for the meeting and furnish proof of their entitlement to participate in it. The Company must receive the registration at the address specified in the notice of meeting at least six days prior to the General Shareholders' Meeting. The notice may specify a shorter period of time, to be indicated by a number of days. The registration must be provided in text form (“Textform”), as defined by German law and must be given in German or English. The confirmation must be current as of the beginning of the 21st day prior to the meeting and must be received by the Company at the address specified in the notice of meeting at least six days prior to the meeting. The notice may specify a shorter period of time, to be indicated by a number of days.
Voting rights may also be exercised by proxy. Where a shareholder grants proxy authorization to more than one person, the Company may reject one or more of such proxies. The grant of a proxy, revocation of a proxy and proof of a proxy vis-à-vis the Company must be in text form. The notice of meeting may specify relaxations as to form. Section 135 of the German Stock Corporation Act shall remain unaffected by the foregoing.
The Executive Board is empowered to stipulate that shareholders may cast their votes in writing or by means of electronic communications (postal voting) even without attending the meeting. The Executive Board may enact specific rules governing the procedure for postal voting.
The Executive Board is empowered to provide that shareholders may participate in the General Shareholders' Meeting even without being present at the location thereof and without having appointed a proxy and may exercise their rights individually or in their entirety by way of electronic communications, in whole or in part (online participation). The Executive Board may enact specific rules governing the scope and procedure for online participation.
The provisions of law applicable in each case shall apply with respect to the calculation of time limits.
Section 18
The General Shareholders' Meeting shall be chaired by the Chairman of the Supervisory Board or by such other member of the Supervisory Board as he may determine. In the event that neither the Chairman of the Supervisory Board nor any member of the Supervisory Board appointed by him assumes the chairmanship of the meeting, the chairperson of the meeting shall be elected by the shareholders' members of the Supervisory Board by a simple majority of votes cast.
The chairperson of the meeting will decide on the basis of the statutory provisions the procedure of the General Shareholders' Meeting, especially the order of the matters on the agenda, and how voting will be carried out.
The meeting's chairperson may place appropriate time restrictions on the shareholders' right to speak and ask questions and determine further particulars in this regard. Specifically, the meeting's chairperson is authorized to stipulate at the beginning of the General Shareholders' Meeting or during the course of the meeting a reasonable time limit on the duration of the entire General Shareholders' Meeting, on individual items on the agenda or on individual speakers.
Section 19
Resolutions by the General Shareholders' Meeting will be passed by simple majorities of votes cast unless the law stipulates a majority of capital shareholdings as well as a majority of votes cast, in which case resolutions will be passed by simple majorities of votes cast and by simple majorities of capital shareholdings represented when the resolution is passed. Any special voting or capital shareholding majorities that are mandated by law shall remain unaffected by the foregoing.
If votes cast (for or against) are equal, the motion is deemed to have been rejected.
VI. APPROPRIATION OF THE PROFIT FOR THE YEAR
Section 20
If the Executive Board and the Supervisory Board approve the annual financial statements, they may transfer up to 100% of the net profit for the year – after deducting the amount which must be transferred to the legal reserve and any loss carry-forwards there may be – to other revenue reserves, provided the other reserves do not exceed one half of the share capital, or if they would not exceed that amount after the transfer.
