Annual Report 2017

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96 Rothschild & Co | Annual Report 2017
Corporate governance
The Company’s Managing Partner decided to submit for approval to
the General Meeting of shareholders on 17 May 2018, in particular the
following new delegations to be granted to the Company’s Managing
Partner:
• Delegation of authority to the Managing Partner to reduce the share
capital by cancelling treasury shares;
• Delegation of authority to the Managing Partner to increase the share
capital by incorporation of reserves, income or issue, merger or
contribution premiums;
• Delegation of authority to the Managing Partner to issue transferable
securities with preferential subscription rights maintained, giving
immediate or deferred access to the Company’s share capital;
• Delegation of authority to the Managing Partner to issue transferable
securities with waiver of preferential subscription rights, giving
immediate or deferred access to the Company’s share capital through
a public offer;
• Delegation of authority to the Managing Partner to issue transferable
securities with waiver of preferential subscription rights and free fixing
of issue price, giving immediate or deferred access to the Company’s
share capital;
• Delegation of authority to the Managing Partner to increase the number
of securities to be issued when increasing the share capital with waiver
or not of preferential subscription rights;
• Authorisation granted to the Managing Partner to grant options to
subscribe for or purchase Company’s shares to employees and executive
officers of the Company and companies related to it;
• Delegation of authority to the Managing Partner to issue securities
granting immediate or deferred access to the share capital reserved
for members of a corporate saving plan;
• Delegation of powers to the Managing Partner for the purpose of issuing
ordinary shares in order to remunerate contributions in kind granted to
the Company consisting of equities or securities giving access to the
share capital;
• Authorisation granted to the Managing Partner to grant bonus shares
to employees and corporate officers of the Company and/or associated
companies;
• Delegation of authority granted to the Managing Partner to issue shares,
without preferential subscription rights, reserved for (i) the Group’s
employees and corporate officers and (ii) foreign subsidiaries in the
context of the implementation of stock option plans.
More detailed information will be presented on these proposed delegations
of authority in the General Meeting Document grouping all information to
be presented to shareholders, including the report to shareholders from
the Supervisory Board to be published on the Company’s website at
.
3 Elements that can have an impact in
the event of a takeover bid
Rothschild & Co is a French partnership limited by shares (société en
commandite par actions), and it therefore benefits from such legal form,
which includes specific legal and statutory provisions that may have an
impact in the event of a takeover bid.
3.1 Share ownership structure
The share ownership structure is described on page 59 of this report.
Following Rothschild & Co’s conversion into a French partnership limited
by shares, this structure has a particularity linked to the existence of two
categories of partners: General Partners and Limited Partners.
A change of control therefore implies a change in the composition of these
two categories of partners. Subject to the other elements described below
that could have an impact in the event of a takeover bid on the Company’s
shares, a third party could, through a takeover bid, acquire control of the
capital and the related voting rights. It could not, however, take control of
the General Partners. In these conditions, a third party that acquired control
of Rothschild & Co would, in particular, be unable to modify the articles of
association or dismiss the Managing Partners as such decisions can only
be made with the unanimous agreement of the General Partners. Also,
General Partners may not transfer the shares they hold without the
unanimous agreement of all the General Partners. These provisions are
such as to prevent a change of control of Rothschild & Co without the
unanimous agreement of the General Partners.
3.2 Statutory restrictions on the exercise
of voting rights and share transfers
Rothschild & Co’s articles of association do not put any direct restrictions
on the exercise of voting rights and share transfers.
However, in addition to threshold crossings, subject to legal provisions,
Article 7.3 of Rothschild & Co’s articles of association establishes statutory
disclosure obligations as described on page 61 of this report.
3.3 Holders of securities granting special
rights of control
As at the date of this report, there were no securities granting special rights
of control. However, Rothschild & Co’s General Partners, Rothschild & Co
Gestion SAS and Rothschild & Co Commandité SAS, have some rights that
could be assimilated to special rights of control, as described on page 54
of this report.