Electrica S.A.

Result of EGMS from November 10th 2015

RNS Number : 2548F
Electrica S.A.
10 November 2015
 

To:                             

 

Bucharest Stock Exchange

Romanian Financial Supervisory Authority

London Stock Exchange (LSE)

 

Current report in compliance with Art. 226 (1) of the Romanian Capital Market Law no. 297/2004, Art. 113 letter A of CNVM Regulation no. 1/2006, and the Bucharest Stock Exchange Code

Report date: 10.11.2015

Company name: Societatea de Distribuţie şi Furnizare a Energiei Electrice - "ELECTRICA" S.A.

Headquarters: 9 Grigore Alexandrescu Street, 1st District, Bucharest, Romania

Phone/fax no: 004-021-2085999/ 004-021-2085998

Fiscal Code: RO 13267221

Trade Register registration number: J40/7425/2000

Subscribed and paid in share capital: RON 3,459,399,290

Regulated market where the issued securities are traded: Bucharest Stock Exchange (BVB) and London Stock Exchange (LSE)

 

Significant events to be reported:

The resolution of the Extraordinary Meeting of Shareholders of Societatea de Distribuţie şi Furnizare a Energiei Electrice - "ELECTRICA" S.A. ("Electrica" or the "Company") no. 3 of 10 November 2015

Electrica hereby informs that on 10 November 2015, the Etraordinary General Meeting of Electrica's Shareholders took place at FISE Electrica Serv SA's headquarters in Bucharest, sector 1, 1A Ştefan cel Mare Road, postal code 011736, Conference Room, starting at 10.00 o'clock (Romanian time), being duly held in accordance with the legal and statutory provisions upon the first calling.

The meeting was attended by the shareholders registered in the shareholder's register kept by the Central Depository on 15 October 2015, set as reference date, in person, by representative or through vote by correspondence, the quorum met being 77,73% of the total voting rights and 76,18% of the share capital of the Company.

The meeting was chaired by Mr. Victor Cionga, as chairman of the Board of Directors of Electrica.

Within the Extraordinary General Meeting of Shareholders, Electrica's shareholders approved the following:

-     Item 1: Mandating the Management Board of Electrica ("Board") to start negotiations with Fondul Proprietatea SA ("Fondul Proprietatea") on behalf of Electrica to acquire the entire stake held by Fondul Proprietatea in the share capital of Electrica's subsidiaries, respectively Electrica Distribuţie Muntenia Nord (EDMN), Electrica Distribuţie Transilvania Nord (EDTN), Electrica Distribuţie Transilvania Sud (EDTS) and Electrica Furnizare SA (Electrica Furnizare), based on the following general terms and conditions:

1.1      The object of acquisition: all holdings of Fondul Proprietatea in the share capital of EDMN, EDTN, EDTS and Electrica Furnizare, as follows:

i. 21.99% of the share capital of EDMN, respectively [7,796,022] shares;

ii. 22% of the share capital of EDTN, respectively [8,167,813] shares;

iii. 21.99% of the share capital of EDTS, respectively [9,327,282] shares;

iv. 22% of the share capital of Electrica Furnizare, respectively [1,366,412] shares.

1.2      Price: the total price to be paid to Fondul Proprietatea for the stakes described in paragraph 1.1 will have to exclusively account for the existent economic arguments for this acquisition. At the completion of the negotiation process, the Board is required to publicly announce the offered price, either accepted or not accepted by Fondul Proprietatea, together with the economic argumentation that formed the base of the offer.

1.3        Negotiation period: the Board will have to close the negotiation process by 31.03.2016, the closing of the process will be immediately followed by the publication of the offered price, as stipulated at paragraph 1.2.

-     Item 21:     If Item 2 of the EGMS agenda is not approved, the approval of the relevant acquisition contract (including its specific terms) for the acquisition of all minority stakes in all the Company's subsidiaries owned by Fondul Proprietatea S.A. will be resolved upon by a subsequent Extraordinary General Meeting of Shareholders, to be convened by the Company's Board of Directors promptly after and if the Company's Board of Directors deems that the negotiations conducted with Fondul Proprietatea, as per item 1 above, lead to a transaction price potentially acceptable by the Company.

-     Item 3: Amending the Articles of Association of Societatea de Distributie si Furnizare a Energiei Electrice ELECTRICA SA, as follows:

Art. 7(2) is amended as follows: "The share capital is held as follows:

·           The Romanian State represented by the Ministry of Energy, Small and Medium-Sized Enterprises and Business Environment holds a number of 168,751,185 shares, having a total nominal value of RON 1,687,511,850, out of which RON 38,467,970 contribution in kind (representing plots of land and constructions), representing 48.78% of the share capital;

·           Shareholders list type, (462 legal entities), hold a number of 143,261,974 shares, having a total nominal value of RON 1,432,619,740, composed of cash contribution of RON 1,080,809,740 and USD 109,240,801.12 (at an exchange rate of 3.2205 RON/USD), representing 41.41% of the share capital.

·           Shareholders list type, (11,151 natural persons), hold a number of 33,926,770 shares, having a total nominal value of RON 339,267,700, composed of cash contribution of RON 339,267,700, representing 9.81% of the share capital.

The share capital does not include assets such as those provided by art.136, paragraph (4) of the Constitution."

Art. 7(3) is amended as follows: "The Ministry of Energy, Small and Medium-Sized Enterprises and Business Environment represents the Romanian State as shareholder of Electrica S.A. and exercises all the rights attached in its capacity as such."

Art. 17(1) is amended as follows: "Electrica is managed by a Board of directors formed of 7 (seven) directors elected by the Ordinary General Meeting of Shareholders of the Company, out of which at least 4 (four) directors must to be independent and nonexecutive. The Board is entrusted with fulfilling all the necessary and useful acts for performing the Company's business object, save for the ones assigned by the law to the General Meeting of Shareholders, as well as for supervising the directors' activity."

Art. 17(2) is amended as follows: "The Romanian State, represented by the Ministry of Energy, Small and Medium-Sized Enterprises and Business Environment will not be able to propose more than 3 (three) candidates for the positions of directors, members of the Board. The other 4 (four) candidates for the positions of directors will mandatorily be independent and nonexecutive and will be proposed by the other shareholders. Also, all the independent candidates shall comply with eligibility and independence criteria acceptable to the Company's shareholders, including, at least the following mandatory eligibility and independence criteria, arising from the best international practices in the field:

(a)        the candidate must not be a manager of the Company or any company controlled by it and must not have had such a position in the last 5 years;

(b)        the candidate must not have been an employee of the Company or of any company controlled by it or must not have had any such employment relationship in the last 5 years;

(c)        the candidate must not receive or have received from the Company or from any company controlled by it, a supplementary remuneration or any other advantages, other than the ones corresponding to his position of nonexecutive director;

(d)        the candidate must not be a significant shareholder of the Company;

(e)        the candidate must not have or have had, in the last year, business relationships with the Company or with a company controlled by it, either personally, or as an associate, shareholder, director, manager or employee of a company which has such relationships with the Company, if , through their substantial character, they are of a nature that can affect the candidates objectiveness;

(f)        the candidate must not be or have been in the last three years financial auditor or associate employee of the current financial auditor of the Company or of any company controlled by it;

(g)        the candidate must not be a manager in any other company in which a manager of the Company is nonexecutive director;

(h)        the candidate must not have been a nonexecutive director of the Company for more than three mandates;

(i)         the candidate must not have any family relationships with a person falling under the situations provided in letters a) and d);

(j)        in the last five years, the candidate has not occupied a position in a central or local state authority or in competing companies;

(k)        the candidate shall fulfil the appropriate integrity, expertise and qualifications criteria."

Art. 17(4) is amended as follows: "The Board meetings will be validly held in the presence of at least 5 (five) members out of whom two members will mandatorily be independent members."

The remainder articles of the Constitutive Act shall remain unchanged.

-     Item 4: Empowering the President of the Board of Directors to sign the addendum to the Articles of Association and the updated Articles of Association, and the meeting secretariat and the technical secretariat to jointly sign the decision of the Extraordinary General Meeting of Shareholders and to individually or jointly fulfil any act or formality required by the law in order to register and publish the decision as well as the addendum and the updated Articles of Association with the Commercial Registry Office of the Bucharest Tribunal.

-Item 7: Setting the registration date as 25 November 2015, should the resolution be taken at the first calling, and as 26 November 2015, should the resolution be taken at the second calling, for the purpose of identifying the shareholders with respect to whom the effects of the resolution of the EGMS apply as per Article 238 of Law No. 297/2004 on capital markets.

- Item 8: Empowering the Chairman of the Board of Directors, the secretary of the meeting and the technical secretary to jointly sign the EGMS resolutions, and to perform individually and not jointly any act or formality required by law for their registration and publication in the Commercial Registry Office of the Bucharest Tribunal.

 

In addition, the Extraordinary General Meeting of Shareholders rejected the following points of the agenda:

- Item 2: Empowerment of the Board of Directors to carry out all necessary documents and contracts and implement any act, in relation with any party, in order to finalize, implement and execute the acquisition.

- Item 5: The adoption of the following changes to the Constitutive Act:

Art. 17, (1), to be modified as per the below:

"(1) Electrica is managed by a board of directors formed of 7 non-executive directors, elected by the Ordinary General Meeting of Shareholders of the Company, out of which at least 4 directors must be independent. The Board is entrusted with fulfilling all the necessary and useful acts for performing the Company's business object, save for the ones assigned to the General Meeting of Shareholders, as well as for supervising the directors' activity."

Art 17, (2), to be modified as per the below:

"(2) The Romanian State, represented by the Ministry of Economy, acting through the Department of Energy or any other successor entity, will not be able to propose more than three (3) candidates for the positions of directors, members of the Board. The other four (4) candidates for the positions of directors will mandatorily be independent and will only be proposed by the other shareholders. All candidates shall comply with eligibility criteria arising from the best nternational practices in the field adopted by shareholders at the proposal of the Board's nomination and remuneration committee. In addition to that, the independent candidates shall also comply, at least, with the following independence criteria acceptable to the Company's shareholders and arising from the best international practices in the field:

a)         the candidate must not be a manager of the Company or any company controlled by it and must not have had such a position in the last 5 years;

b)         the candidate must not have been an employee of the Company or of any company controlled by it or must not have had any such employment relationship in the last 5 years;

c)         the candidate must not receive or have received from the Company or from any company controlled by it, a supplementary remuneration or any other advantages, other than the ones corresponding to his position of non-executive director;

d)         the candidate must not be a significant shareholder of the Company;

e)         the candidate must not have or have had, in the last year, business relationships with the Company or with a company controlled by it, either personally, or as an associate, shareholder, director, manager or employee of a company which has such relationships with the Company, if, through their substantial character, they are of a nature that can affect the candidates objectiveness;

f)          the candidate must not be or have been in the last three years the / a financial auditor or associate employee of the current financial auditor of the Company or of any company controlled by it;

g)         the candidate must not be a manager in any other company in which a manager of the Company is nonexecutive director;

h)         the candidate must not have been a non-executive director of the Company for more than three mandates;

i)          the candidate must not have any family relationships with a person falling under the situations provided in letters a) and d);

j) in the last five years, the candidate has not occupied a position in a central or local state authority or in competing companies;

k) the candidate shall fulfil the appropriate integrity, expertise and qualifications criteria,"

Art 17 (4), to be modified, as per the below:

"(4) The Board meetings will be validly held in the presence of at least five (5) members out of whom at least three (3) members will mandatorily be independent."

Art 17 (23), to be modified, as per the below:

"(23) The Board delegates the Company's management to one or more managers, from outside the Board, appointing one of them general manager."

Art 18 C (2), to be modified, as per the below:

"C (2) The nomination and remuneration committee makes proposals for the positions of members of the Board, drafts and proposes to the Board the selection procedure regarding candidates for manager positions and for other management positions, recommends to the Board candidates for the foregoing listed positions, makes proposals regarding the remuneration of managers and other management positions. The nomination and remuneration committee also proposes eligibility criteria for the Board members and, upon the adoption of such criteria by the shareholders, is responsible for the screening of candidates proposed for the Board member positions, endorsing or rejecting candidates, as the case may be."

Art 18 C (6), to be modified, as per the below:

"C (6) The consultative committees comprise of an uneven number of Board members, with a minimum of three (3) and a maximum of five (5). The majority of the members of audit committee and the nomination and remuneration committee must be represented by independent directors. In addition, at least one member of the audit committee must hold relevant experience in accounting and/or financial audit."

-     Item 6: In case the shareholders, on November 10, adopt one of the two proposals to increase the number of Board members from 5 to 7, the EBRD proposes the following process to take place:

the Nomination and Remuneration Committee will submit to the Board before year end a set of eligibility criteria for Board members;

following the adoption of the eligibility criteria, the existing Board will call for an extraordinary shareholders meeting before 15.01.2016 to approve the eligibility criteria for Board members, as per Art 13 (4) (r);

upon the adoption of the eligibility criteria by the shareholders, the Board will immediately, but not later than 01.03.2016, call for an extraordinary shareholders meeting to elect a new Board;

all legally entitled parties will be able to nominate candidates for the Board membership to the Nomination and Remuneration Committee. The Committee will screen the candidates based on the eligibility criteria and those found eligible will automatically be put to a vote at the above mentioned extraordinary shareholders meeting. If the Committee, based on the eligibility criteria, deems one or several candidates as not eligible, those candidates will be rejected.

General Manager

Ioan Roşca

 


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