Report of the Management Board and Supervisory Board of S&T AG (FN 190272m) on the intended sale of own Shares
The Management Board and the Supervisory Board of S&T AG (the "Company") hereby submit the following report to the shareholders of the Company pursuant to (analogously) § 153 para. 4 in conjunction with § 159 para. 2 no. 3 of the Austrian Stock Corporation Act on the intended sale of treasury shares of the Company for the purpose of servicing stock options issued to employees, executives and members of the Management Board of the Company or an affiliated company within the framework of the stock option program 2015 - tranche 2016 (together the "Stock Option Program").
The Annual General Meeting of the Company on 25 June 2015 resolved in accordance with § 159 (3) Stock Corporation Act to carry out a conditional capital increase (§ 5 (8) of the Articles of Association of the Company) by up to a nominal amount of EUR 2,580,000.00 for the purpose of servicing stock options issued to executives and members of the Management Board of the Company or an affiliated company within the framework of the stock option program. With regard to further details of the stock option program as well as the principles and performance incentives underlying the structure of the stock options, reference is made to the written report of the Management Board and the Supervisory Board pursuant to Section 159 (3) AktG on the 8th item of the agenda of the 16th Annual General Meeting on June 25, 2015, which has been available on the Company's website at www.ir.snt.at since June 3, 2015.
The Extraordinary General Meeting of the Company held on 15 January 2019 authorised the Management Board to acquire own shares in accordance with Section 65 (1) 8 and (1a) and (1b) of the Austrian Stock Corporation Act, both via the stock exchange and off-exchange, up to an amount of 10% of the Company's share capital, while at the same time authorising the Management Board in accordance with Section 65 (1b) of the Austrian Stock Corporation Act to dispose of or use own shares in a way other than via the stock exchange or by means of a public offer, excluding the right of repurchase (reverse subscription right) (the "Repurchase and Resale Authorisation"). A corresponding report by the Management Board pursuant to Section 170 (2) in conjunction with Section 153 (4) in conjunction with Section 65 (1b) of the Austrian Stock Corporation Act was published on time in December 2018 and is available on the Company's website at www.ir.snt.at.
1. Number of options allocated and still exercisable under the stock option program
1.1 Under the stock option program, a total of 478,000 stock options were allocated to executives and members of the Management Board of the Company or of an affiliated company, entitling them to purchase a total of 478,000 shares in the Company.
1.2 To date, 447,000 of the 478,000 stock options have been exercised and the corresponding new shares have been issued to the exercising persons from the conditional capital of the Company pursuant to § 5 (8) of the Articles of Association. 31,000 stock options, which entitle the holder to subscribe to 31,000 new shares in the company, have not yet been exercised. The period for exercising the stock options ends on March 6, 2020, with the possibility that all 31,000 stock options may be exercised in the coming months until the end of the exercise period. In the event of exercise, the Company intends to service these stock options by reselling repurchased shares of the Company. The Management Board of the Company intends to adopt a resolution to this effect on the basis of the buyback and resale authorization.
2. On the exclusion of the shareholders' right of repurchase
2.1 If implemented, the possibility of acquiring treasury shares and selling them by means other than via the stock exchange or a public offer for the purpose of servicing stock options would be in the interests of the Company and would be proportionate: Such participation programs are common and widespread at listed companies today. To this end, it is necessary to be able to offer the employees and management of S&T AG and the Group companies the opportunity to acquire shares in the company, as this is expected by the employees and management. It would therefore be a disadvantage in the recruitment of new employees and managers if there were no participation program. Similarly, such a program serves to increase the motivation of existing employees, to increase the retention period of employees and to promote sales and profit growth by each individual employee. Stock options are therefore also a necessary means of employee retention and contribute to increasing the Company's attractiveness as an employer. In the absence of stock options, the Company and its Group companies could be forced to pay higher variable salary components in cash to executives and management. Finally, investors also expect employees and management to participate in the Company's success. The success of the Company's capital measures depends, among other things, on the existence of a stock option program.
2.2 The possibility of acquiring own shares and selling them by means other than via the stock exchange or a public offer for the purpose of servicing stock options is also necessary in order to be able to implement such a program independently of any conditional and/or authorized conditional capital.
2.3 Pursuant to Section 65 1b last sentence of the Stock Corporation Act, the sale of own shares to employees, executives and/or members of the Management Board of the Company or of a company affiliated with the Company for the purpose of servicing stock options is justified by law: the possibility of selling own shares to these persons does not require a resolution (i.e. no separate authorization) of the General Meeting.
2.4 The sale of own shares while excluding the possibility of shareholders to acquire these shares also does not lead to a "typical" dilution of shareholders. Initially, the proportion of existing shareholders or the voting power from the existing shareholders' own shares only "increased" because the Company has repurchased its own shares and the rights from these shares are therefore suspended as long as they are held by the Company as own shares. A reduction in the sphere of the individual existing shareholders only occurs when the Company resells the acquired treasury shares, excluding the shareholders' purchase option. After the sale, the shareholders regain the status they already had before the company acquired the relevant treasury shares. In this context, it should also be noted that due to the small size of the transaction, no controlling interest of an entitled party in the Company can arise. The shareholders will not suffer any material pecuniary disadvantage as a result of the small volume: The object of the intended sale is only up to 31,000 shares (up to 0.047% of the Company's share capital).
2.5 Overall, the exclusion of the repurchase right (subscription right) is therefore objectively justified.
2.6 The resale of own shares under exclusion of the shareholders' repurchase right for the purpose of servicing stock options is a common and generally accepted practice. In addition, the extensive disclosure obligations in connection with the sale of own shares - also in connection with any other disclosure obligations applicable to listed companies - ensure comprehensive transparency in connection with the sale of own shares. Furthermore, the exclusion of the right of repurchase (subscription right) is only possible with the consent of the Supervisory Board. The management board of the company cannot decide alone. The interests of existing shareholders are not exposed to any particular danger as a result.
2.7 In summary, the Management Board and the Supervisory Board of the Company therefore come to the conclusion that the servicing of the stock options with own shares under exclusion of the repurchase right (subscription right) of the shareholders complies with the statutory provisions.
3. Next steps
3.1 After expiry of a period of at least 14 days after publication of this report and at the earliest three stock exchange days after publication of the intended resale of treasury shares, treasury shares of the Company may be sold under the conditions described above in accordance with the corresponding exercise declarations of the beneficiaries.
3.2 The period for exercising the stock options ends on 6.3.2020. The possibility of selling own shares therefore exists for the period after the end of this period for as long as necessary for the delivery of the shares, but ends no later than 30.4.2020.
Linz, December 2019
The Management Board and the Supervisory Board of S&T AG
S&T AG resolves on sale of 1,000 own shares
Based on the repurchase and sale authorization granted by the extraordinary shareholder meeting on 15 January 2019, the Executive Board of S&T AG (www.snt.at) resolved to sell own shares of the Company.
On 20 December 2019, the Executive Board and the Supervisory Board published a report on the re-sale of own shares subject to an exclusion of repurchase rights of shareholders on the basis of the repurchase and sale authorization, which was published in the Official Gazette of Wiener Zeitung as well as under https://ir.snt.at/Use_of_own_shares_I_2019.en.html
Up to date, the Company has received execution notices for stock options, which entitle the option holder to receipt of 1,000 shares in S&T AG, by one authorized person. The Company will meet the delivery obligation f S&T AG shares out of own shares.
Details on the sale of own shares are published on the company's website under https://ir.snt.at/Use_of_own_shares_I_2019.en.html.
Use of own shares (sale):
Date of the granted authorization by the shareholder meeting pursuant to § 65 paragraph 1 no 8 of the Stock Corporation Act (AktG): 15 January 2019 (published on 15 January 2019)
Start and provisional duration of the sale: On or about 10 January 2020
Type of securities: bearer shares (ISIN AT0000A0E9W5)
Intended volume of sale: 1,000 own shares of S&T AG (approx. 0.0016% of the share capital of S&T AG)
Exercising price per share: Pursuant to the terms and conditions of the Stock Option Programme 2015 – Tranche 2016, EUR 5.74 per share
Type of sale: over the counter (delivery of shares to authorized persons under the Stock Option Programme following the execution of stock options)
Reasons for the sale: Utilization of own shares for all purposes under applicable laws and in accordance with the authorization granted by the extraordinary shareholder meeting on 15 January 2019 (delivery of shares to authorized persons under the Stock Option Programme)
Effects of the sale on the admission of the shares to listing on the stock exchange: not applicable
Transaction closing message
On January 7, 2020, S&T AG published a resolution to sell treasury shares to meet delivery obligations to beneficiaries of S&T AG stock option programs, to the extent that they exercise stock options. S&T AG published the corresponding intention on 20 December 2019. The sale of 1,000 own shares was made to a beneficiary who exercised 1,000 stock options entitling him to purchase 1,000 S&T AG shares.
S&T AG announces that the sale of the 1,000 own shares, which represent approximately 0.0016% of the share capital, was carried out over-the-counter on the following parameters:
- Date: 14.1.2020
- Total number of shares sold: 1,000
thereof sold on the stock exchange: 0
thereof sold over-the-counter: 1,000
- Share of share capital: approx. 0.0016%
- Highest price / lowest price per share (in EUR): 5.74
- Highest price / lowest price per share (in EUR): 5.74
- Weighted average price per share (in EUR): 5.74
- Total value of shares sold (in EUR): 5,740