Airbus SE — Governance Information 2012

Dec 5, 2012

News Details

Ad-hoc | 5 December 2012 18:00

European Aeronautic Defence and Space Company EADS N.V.: EADS Governance and Shareholding Structure Receives Far-Reaching Overhaul

European Aeronautic Defence and Space Company EADS N.V. / Key word(s): Miscellaneous

05.12.2012 18:00

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Ad-hoc release, 5 December 2012

EADS Governance and Shareholding Structure Receives Far-Reaching Overhaul

• Present shareholder pact expected to be replaced by a normal company
  governance scheme

• Daimler AG and Lagardère SCA to largely reduce their stakes, Germany
  and France intending to ultimately hold up to 12% each, Spain circa 4%

• EADS intends to propose a share buy-back of up to 15% of outstanding
  shares - subject to market conditions and shareholder approval

• Free Float of EADS shares should therefore ultimately increase from 49%
  to over 70%

The EADS Board of Directors and the company's core shareholders have agreed
on a far-reaching change of the company's shareholding structure and
governance.

This agreement aims at normalising and simplifying the governance of EADS
while securing a shareholding structure that allows France, Germany and
Spain to protect their legitimate strategic interests.

Subject to customary regulatory conditions and to Germany (through
Kreditanstalt für Wiederaufbau (KfW), the investment arm of the German
State) acquiring an initial block of 5 percent of EADS, an Extraordinary
General Meeting of shareholders will be held during the first half of 2013,
to vote on the proposed changes to the company's Articles of Association,
on the proposed share buy-back and to elect new directors.

New Shareholding Structure and New Governance

Key elements of the agreement are:

• France and Germany intend to build equal ownership positions, while the
  present core industrial shareholders, Daimler AG and Lagardère SCA, are
  provided with a path to partially divest and will eventually be free to
  trade their shares at their discretion.

• Subject to the vote of the Extraordinary General Meeting of the
  shareholders of EADS, the present shareholder pact, called
  'Participation Agreement', in place since the company's foundation in
  2000, will be terminated and replaced by a new, limited arrangement
  between the French, German and Spanish Governments.

• France, Germany and Spain have agreed on a capped government
  shareholding (approximately 12 plus 12 plus 4 percent). The three
  states will have reciprocal pre-emption rights. The amended Articles of
  Association of EADS will contain an ownership and voting restriction
  from crossing the 15 percent threshold by shareholder individually or
  collectively.

• The three States have agreed that, upon the request of any of them,
  they would vote against a future change to a limited number of the new
  governance provisions.

• The future EADS Board will comprise 12 members, proposed by the
  Remuneration and Nomination Committee, including a Chairman, a Chief
  Executive Officer and at least 8 independent Non-Executive Directors.
  The majority of Directors as well as two thirds of the members of the
  Executive Committee will be EU nationals.

• Certain specific French and German national security interests will be
  protected through the creation of 'national defence companies' holding
  sensitive military assets, and including the rights of France and
  Germany to consent to three outside directors to the board of their
  respective 'national defence companies'. Two of such directors of each
  'national defence company' shall be members of the EADS Board.

• Under the new governance scheme, no veto right will be given to any
  group of Directors in the Board or to any shareholder at the
  Shareholders' Meeting.

Evolution of Core Shareholding and Share Buy-back

Daimler AG and Lagardère SCA intend to substantially reduce their
participation in EADS - either immediately or in the near future.

1) Disposal by Daimler AG

Before year-end 2012, Daimler AG intends to reduce its shareholding in EADS
by up to 7.44 percent of the share capital 1). In this context, KfW intends
to buy approximately 2.76 percent 1).

In parallel, and at a price determined by reference to the contemplated
transaction with Daimler AG, KfW intends to buy the privately-held
interests in the Dedalus consortium, which owns a total of 7.44 percent of
EADS' share capital 1).

Ultimately, KfW, together with other German public entities currently
holding interests in Dedalus, will thus own a total economic interest of c.
10.2 percent in EADS 1) (corresponding to 12 percent 1) after completion of
the below-mentioned up-to-15 percent share buy-back if at maximum level).

1) Based on outstanding number of shares excluding treasury shares

2) Share buy-back

Subject to market conditions and to the approval of the Extraordinary
General Meeting, EADS intends to implement a share buy-back program and
subsequent cancellation of up to 15 percent of the outstanding EADS shares,
divided into two equal and simultaneous tranches bearing the same terms and
conditions:

• A first tranche of up to 7.5 percent, which shall be open to all of
  EADS' shareholders, other than the parties to today's agreement; and

• A second tranche of up to 7.5 percent, which shall be reserved
  exclusively for Lagardère SCA up to 5.5 percent. If the size of the
  tranche is higher than 5.5 percent, SOGEPA and SEPI will have the right
  to tender the remainder (based on their pro rata ownership of EADS
  shares unless they agree otherwise). In the event that SOGEPA and SEPI
  do not exercise their right, Lagardère SCA could take up to the full
  amount of the tranche. Finally, in the event that this tranche is not
  fully tendered by the above parties, Daimler AG will have the right to
  participate up to the full unused amount of the tranche.

3) Orderly disposal provisions

Except for the purpose of the above transactions, Daimler AG, Lagardère
SCA, SOGEPA, SEPI and KfW have agreed to a lock-up until the earlier of the
approval of the new governance by the Extraordinary General Meeting or 31
July 2013.

Should the Extraordinary General Meeting not approve the new governance,
Daimler AG and Lagardère SCA would benefit from limited monetization
options.

At the expiration of the lock-up period, Daimler AG and Lagardère SCA will
be free to dispose of the EADS shares they would still own (after the share
buy-back, if any) and have agreed to certain provisions organizing an
orderly process to that purpose.

4) Excess shares of the French, German and Spanish States

As of the earlier of 1 January 2014 or the date on which Daimler AG has
sold more than 5 percent of EADS, SOGEPA, SEPI and KfW will be free to sell
any shares which together will result in their combined holding exceeding
28 percent of EADS ('excess shares') over time. As of the date of the
Extraordinary General Meeting and until they are sold, such excess shares
will be separately warehoused by their respective owners (i.e. deposited
without voting rights) in order to reach the above-mentioned combined stake
of less than 28 percent, with SOGEPA and KfW intending to maintain equal
stakes.

Eventually, the free float of EADS shares will increase from slightly less
than 50 percent to over 70 percent, including any excess shares warehoused
by the French, German or Spanish State and the shares that would still be
owned by Daimler and Lagardère until all those shares are ultimately sold.

Tom Enders, Chief Executive Officer of EADS said: 'Today is a good day for
EADS! We are making a big leap forward in terms of governance, actually the
most important change since the creation of our company more than 12 years
ago. Strategy and industrial projects in the future will be solely defined
and decided by the Board of Directors and the Executive team, the
operations will be managed without any outside interference from specific
shareholders or shareholder concerts. At the same time, the company will
take care of legitimate national security interests of governments through
appropriate undertakings. The new shareholder structure allows for a
significant increase in the free float of shares. Our intention for a major
share buy-back next year, based on our strong liquidity position, will
benefit all shareholders. Finally, I'd like to thank the governments of
France, Germany and Spain as well as Daimler and Lagardère for their active
support in reaching this important agreement.I can say, the Executive
management team is very excited about this development and the
opportunities that flow from it for the future of our great company.'

***************

In the context of this change of governance, and in a separate agreement
with the French State, subject to the consummation of the above
transactions, EADS has undertaken to consult with the French State before
exercising its voting rights at the general meeting of shareholders of
Dassault Aviation and has granted the French State a right of first offer /
first refusal in case of the sale of all or part of its stake in Dassault
Aviation.

The parties to today's agreement are EADS, Daimler AG, DASA, Lagardère SCA,
SOGEPA, Sogeade, KfW and SEPI.

About EADS
EADS is a global leader in aerospace, defence and related services. In
2011, the Group - comprising Airbus, Astrium, Cassidian and Eurocopter -
generated revenues of EUR 49.1 billion and employed a workforce of over
133,000.

Contacts:
Press:
Martin Agüera +49 (0) 175 227 4369
Matthieu Duvelleroy +33 (0) 142 242 425
Gregor von Kursell +49 (0) 89 607 34 255
Rod Stone +33 (0) 142 242 775

www.eads.com

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Language: English
Company: European Aeronautic Defence and Space Company EADS N.V.
P.O. Box 32008
2303 DA Leiden
Netherlands
Phone: 00 800 00 02 2002
Fax: +49 (0)89 607 - 26481
E-mail: ir@eads.net
Internet: www.eads.com
ISIN: NL0000235190
WKN: 938914
Indices: MDAX
Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
in Berlin, Düsseldorf, Hamburg, Hannover, München, Stuttgart

End of Announcement DGAP News-Service

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