Rules of the Management Board of Ziggo NV (the Company)

Transcription

1 Management board rules Rules of the Management Board of Ziggo NV (the Company) Effective as of March 20, 2011 Article 1 Authority of the Management Board 1.1 In performing its duties, the Management Board shall carefully consider and act in accordance with the interests of the Company and the business connected with it, taking into consideration the interests of the Company and all the stakeholders of the Company. 1.2 The authority to manage the Company is vested in the Management Board as a whole, which includes, among other things: (i) the setting and achievement of the Company s objectives; (ii) the Company s strategy, its policies, and the ensuing delivery of results, the risks inherent in its business activities and the financing of the Company; (iii) the structure and operation of the internal risk-management and control systems; (iv) the financial-reporting process and the establishment and maintenance of the internal controls over financial reporting in accordance with article 1.4.c; (v) the preparation and disclosure of the Periodic Financial Reports and any ad hoc financial information and the disclosure of other information on matters that may substantially influence the price of any listed security issued by the Company to the relevant parties in the financial markets; (vi) the implementation of any recommendation made by the external auditor; (vii) compliance with all legislation and regulations applicable to the Company and its Subsidiaries; (viii) the relation between the Company and its shareholders, including the handling of public bids for the stock of the Company, in close consultation with the Supervisory Board; (ix) the corporate social responsibility issues which are relevant to the Company; (x) the Company s corporate structure. 1.3 The Management Board is accountable for the performance of its duties to the Supervisory Board and the General Meeting of Shareholders and shall perform its activities under the supervision of the Supervisory Board. 1.4 The Management Board shall more specifically: a. formulate, record, implement and, where necessary, adjust the Strategic Plan b. ensure that the Company has internal risk-management and control systems which are suitable for the Company, thereby in any event employing as instruments of the internal risk management and control systems: (i) risk analyses of the operational and financial objectives of the Company; (ii) a code of conduct, which shall be posted on the Company's website (iii) guides for the set-up of the financial-reporting process and the procedures to be followed in drawing up the reports; and (iv) a system of monitoring and reporting; c. maintain contacts with the press, analysts and institutional and other investors, including the establishing and enforcing of general policies with respect thereto, thereby observing that such contacts shall be carefully handled and structured and that the independence of analysts in relation to the Company and vice versa is not being compromised, so that: - analysts meetings, presentations to institutional or other investors and direct discussions with those investors do not take place shortly before the publication of the Company s Periodic Financial Reports; - press conferences and meetings with and presentations to analysts and to institutional and other investors are announced in advance; - provision is made for all shareholders of the Company to follow these meetings and presentations in real time and that such presentations shall be posted on the Company s website; - 1 -

2 - analysts' reports and valuations with respect to shares issued by the Company and securities derived thereof are not assessed, commented upon or corrected other than factually by the Company in advance; - the Company does not pay any fee to any party for the carrying out of research for analysts' reports or for the production or publication of analysts' reports on the Company, with the exception of credit-rating agencies; d. provide for appropriate funding, as determined by the Supervisory Board acting through the audit committee, for payment of compensation to the external auditor for the purpose of rendering or issuing an audit report and to any advisors employed by the audit committee; e. evaluate, at least once every four years, the performance of the external auditor and the scope of the audit(s) to be performed and making recommendations to the Supervisory Board regarding the appointment of the external auditor, their remuneration and, if necessary, their dismissal; f. determine, together with the Supervisory Board, the corporate governance structure of the Company and submit each material change therein to the General Meeting of Shareholders for discussion, or to the extent required, for approval, thereby ensuring compliance with the Dutch Corporate Governance Code and other applicable (foreign) laws and regulations; g. establish procedures for the receipt, recording and handling of complaints regarding accounting, internal accounting controls or auditing matters or the violation of internal or external regulations; h. design and implement the remuneration policies for members of senior management and other employees of the Company; i. represent of the Company and sign of documents in its name, thereby abiding with the internal rule that the Company shall be represented by two Management Board members acting jointly, and shall establish, observe, ensure compliance with and enforce policies regarding: (i) (ii) the decision structure of the Company and its Subsidiaries; and the representation, of the Company and its Subsidiaries and the signing of documents in their name; j. prepare the General Meeting of Shareholders, including the drafting of the agenda thereto, thereby observing that - properly and timely submitted shareholder proposals are included in the agenda, unless a response period as referred to in the Dutch Corporate Governance Code 1 applies; k. interact with the Works Council in accordance with any such arrangements agreed with them from time to time; l. appoint and suspend the Company Secretary, after the prior approval of the Supervisory Board has been obtained. 1.5 Upon first request from the Supervisory Board, which request must be made not later than 15 business days prior to convocation of a General Meeting and after prior consultation with the Management Board and having due regard to the corporate interest (vennootschappelijk belang) of the Company and with due observance of Dutch law, the Management Board will put a proposal relating to any of the following subjects on the agenda of such General Meeting: (i) issue of shares in the capital of the Company and the restriction or exclusion of pre-emptive rights with respect to such issue; (ii) authorization of the Management Board to issue shares in the capital of the Company; (iii) restriction or exclusion of pre-emptive rights; (iv) reduction of the share capital of the Company; (v) amendment to the Articles of Association of the Company; (vi) legal merger of a legal demerger involving the Company; 1 See best practice provisions II.1.9 and IV.4.4 2

3 (vii) dissolution of the Company. This provision 1.5 will no longer apply in case the relationship agreement as entered into between the Company, Warburg Pincus and Cinven on [date], as may be amended from time to time, has been terminated or does no longer include the obligation for the Management Board to put the abovementioned proposals to the agenda at the request of the Supervisory Board. 1.6 Each Management Board member shall sign the Annual Accounts or explain why he will not do so. Such explanation shall be disclosed in the Annual Accounts. Article 2. Division of tasks 2.1 The Management Board may charge the CEO and the CFO, as well as other individual members of the Management Board, with specific parts of the Management Board s managerial tasks. The Management Board as a whole shall, subject to the exceptions by law, remain responsible for all Management Board decisions, even if they are prepared by individual Management Board members. 2.2 An individual Management Board member may only exercise such powers as are explicitly attributed or delegated to him and may never exercise powers beyond those exercisable by the Management Board as a whole. Any use by an individual Management Board member of delegated authority shall be timely communicated to the full Management Board and shall, where specifically provided in the terms of reference of such individual Management Board member, be subject to confirmation by the full Management Board. Article 3. Responsibilities of the CEO, CFO 3.1 The Chief Executive Officer ( CEO ) a. The CEO shall chair the Management Board and shall be primarily responsible for the proper functioning of the Management Board and its committees. He shall act as the spokesman for the Management Board and shall be the main contact for the Supervisory Board and its members. If necessary, a Vice-Chairman shall be appointed by the Supervisory Board to fulfill the duties of the CEO as chairman of the Management Board in his absence. Therefore, in these Rules, CEO should be read as Vice-Chairman if the CEO is not present. b. Without prejudice to the generality of paragraph 1, the responsibilities of the CEO shall in any event include: (i) ensuring the proper performance of Management Board duties and ensuring that the Management Board makes decisions in accordance with these Rules; (ii) drafting the agenda of Management Board meetings and chairing such meetings; (iii) ensuring that passed resolutions, if necessary, are submitted to the Supervisory Board for approval; (iv) supervising the implementation of passed resolutions and determining if further consultation with the Management Board regarding implementation is advisable; (v) submitting a proposed agenda and preparing meetings of the Supervisory Board, in consultation with the Chairman; (vi) ensuring that the Supervisory Board is provided with all information necessary for the proper performance of its duties, among others by (1) regularly meeting with the Chairman, (2) taking part in meetings with the audit committee and the CFO and (3) overseeing communications between the Management Board and the Supervisory Board; (vii) designating Management Board members to consult with any committees or with particular members of the Supervisory Board on behalf of the Management Board; and (viii) discussing on an ad-hoc basis with the Management Board members their respective tasks. c. The CEO is also responsible for: (i) taking the initiative for the Management Board to formulate, record, implement and, where necessary, adjust astrategic plan ( the Strategic Plan ); (ii) ensuring that passed Management Board resolutions comply with the Strategic Plan; 3

4 This primary responsibility of the CEO is without prejudice to the responsibility of each individual Management Board member for his business lines operating within the scope of the Strategic (medium term) Plan approved by the Management Board. 3.2 The Chief Financial Officer ( CFO ) The CFO is primarily responsible for: (i) formulating and communicating the Company s financial strategy; (ii) the integrity of the Company s accounts, including the choice of accounting policies, the application of financial reporting-related laws and regulation and the handling of estimates and forecasts; (iii) reporting the Company s financial results and the processes and internal business control systems pertaining thereto; (iv) financing the Company and finance-related strategies; (v) tax planning and taxation-related policies; and (vi) the external auditor s qualifications and independence, remuneration and nonaudit work for the Company (without prejudice to the responsibilities of the audit committee s responsibilities in this respect); (vii) the performance of tasks by the Corporate Audit Services department of the Company (hereinafter referred to as CAS ) and the external auditor; and (viii) the implementation of the recommendations of the external auditor and CAS; (ix) the communication with the Supervisory Board and the audit committee on the above-mentioned subjects and shall, when requested, take part in meetings of the audit committee to discuss these subjects. This primary responsibility of the CFO is without prejudice to the responsibility of each individual Management Board member for his business lines operating within the scope of the Strategic (medium term) Plan approved by the Management Board. Article 4. Responsibilities of the Company Secretary 4.1 The Company Secretary shall assist the Management Board as provided for herein and shall also assist the Supervisory Board as provided for in the Supervisory Board Rules. All Management Board members shall have access to the advice and services of the Company Secretary. 4.2 The Company Secretary is responsible for ensuring that correct procedures are followed according to these Rules and that the Management Board acts in accordance with applicable rules and regulations and its obligations under the Articles of Association. The Company Secretary shall assist the CEO in the organization of the affairs of the Management Board (preparing meetings, recording minutes, information etc.). 4.3 The duties of the Company Secretary under these Rules, or part thereof, may be delegated to another person, in consultation with the CEO. Article 5. Meetings of the Management Board 5.1 The Management Board shall in principle meet once a week, or more often as deemed necessary or desirable for a proper functioning of the Management Board by any one or more Management Board members, but not less than once a month. 5.2 Meetings of the Management Board shall be called by the CEO, or another member of the Management Board. 5.3 The agenda for the meeting shall as a general rule be sent to all Management Board members three calendar days prior to the meeting. For each item on the agenda, an explanation in writing shall be provided, where possible, and/or other related documentation shall be attached. 5.4 Management Board meetings shall be generally held at the offices of the Company, but may also take place elsewhere. In addition, meetings of the Management Board may be held by conference call, video conference or by any other means of communication, provided all participants can communicate with each other simultaneously. 4

5 5.5 The admittance at the meeting of persons other than the Management Board members and the Company Secretary shall be decided by the chairman of the meeting. 5.6 A Management Board member may be represented at meetings by another Management Board member holding a proxy in writing. The existence of such proxy shall be proved satisfactorily to the CEO or, in his absence, Management Board members present at the meeting. 5.7 Management Board meetings shall be presided over by the CEO. In case of absence of the CEO, the Management Board member with the highest seniority in membership of the Management Board shall preside over the meeting. 5.8 The Company Secretary or any other person designated for such purpose by the chairman of the meeting shall draw up minutes of the meeting. The minutes shall contain a summary of the discussions and shall record the resolutions adopted or other actions taken at the meeting. The minutes shall be adopted by the Management Board at the same meeting or at a subsequent meeting. Article 6. Resolutions of the Management Board 6.1 The Management Board shall preferably adopt resolutions unanimously. Where the Articles of Association, these Rules or applicable laws and regulations do not require a larger majority, all resolutions of the Management Board shall be adopted by an absolute majority of the votes cast. Votes of Management Board members with a conflict of interest as meant in article 10.6 shall not be taken into account. 6.2 The Management Board shall generally adopt all resolutions in a meeting. No decisions may be taken and no resolutions may be adopted if less than three of its members attend the meeting in person or by proxy. 6.3 As a general rule, the Management Board shall not take decisions: a. if the CEO does not attend the meeting in person or by proxy, unless the proposal was approved by the CEO beforehand; b. on policy matters, belonging to the area of expertise or responsibility of a Management Board member other than the CEO, if that member does not attend the meeting, unless the proposal was approved by the relevant Management Board member on beforehand. In deviation of the foregoing, decisions may be taken in extra-ordinary circumstances, such as a long absence or a long illness of the CEO or the relevant Management Board member, and if, considering the interests of the Company and its stakeholders, a decision cannot be postponed. 6.4 Each Management Board member has the right to cast one vote on each matter to be decided by the Management Board. 6.5 If necessary, items may be carried over to a later meeting by the chairman of the Management Board meeting. 6.6 If, considering the urgent nature and other circumstances of the case, the CEO deems necessary, the Management Board may in deviation of paragraph 2 also take decisions and adopt resolutions outside a formal meeting, provided that all members of the Management Board have had the opportunity to voice their opinion in respect of the proposal concerned and that all members agree to this form of decision-taking. The adoption of resolutions outside a meeting must be reported at the following formal meeting. With respect to the foregoing, Management Board members with a conflict of interests shall not be taken into account. The CEO and the Company Secretary shall prepare a report on a resolution so adopted, which shall be added to the documents for the next meeting of the Management Board. The Company Secretary shall add a decision carried in this way to the minutes' register of the Management Board, together with the documents containing evidence of such a decision. Article 7. Matters to be approved by the Supervisory Board The Management Board shall submit for approval to the Supervisory Board all matters, resolutions and proposed resolutions, set out in Annex 1. Article 8. Matters to be discussed with the Supervisory Board The Management Board shall in any event discuss with the Supervisory Board: 5

6 a. the strategy, policies, long-term plans and risks attached to the business of the Company, including the Strategic Plan: at least annually but in any event upon a material change thereof; b. the risk profile of the Company: at least annually but in any event upon a material change thereof; c. the main organizational structure of the Company and, considering the assessment made by the Management Board, the design and operation of its internal risk-management and other control systems and any necessary changes or corrective actions to be taken with respect thereto : at least annually but in any event upon a material change thereof; d. the design and implementation, both prospective and retrospective, of the remuneration policies applied by the Company and the assessment by the Management Board whether variable incomes are consistent with the applicable remuneration policy of the Company, with special attention for the highest variable incomes: at least annually but in any event upon a material change thereof; e. any material retention, exit and welcome packages, with a view to assessing that these are consistent with the Company s remuneration policy so as to ensure that these are not excessive: when applicable; f. the Annual Financial Report as examined by the external auditor and discussed with the audit committee: at such point in time that this can be released within four months of the end of the relevant financial year; g. the Semi-annual Financial Report together with the review report of the external auditor, as discussed with the audit committee: at such point in time that this can be released within two months of the end of the relevant reporting period; h. the quarterly accounts as discussed with the audit committee: at such point in time that these can be released within two months of the end of the relevant reporting period; i. if, in addition to the discussions within the audit committee, the Supervisory Board decides to discuss these in the full Supervisory Board: the annual report as examined by the external auditor as well as the interim financial statements: at such point in time that these can be released within three months of the end of the relevant reporting period; j. any proposal with the explanation thereto which is proposed to be submitted to the General Meeting of Shareholders as well as the application and use of a response period as referred to in the Dutch Corporate Governance Code with respect to any shareholder proposal; when applicable; k. any public bid for the shares issued by the Company or any transaction similar thereto (including but not limited to a legal merger or de-merger, or an asset sale) which is known to the Management Board to be prepared and any material development in such process: forthwith; l. a request from a competing bidder, made after a takeover bid or any transaction similar thereto (including but not limited to a legal merger or de-merger, or an asset sale) for the Company was announced or made, to inspect the Company s records: forthwith; and m. the intention to issue shares in the capital of the Company and to exclude pre-emptive rights, if so designated by the general meeting of shareholders in accordance with article 5.1 and 6.6 of the Articles of Association. Article 9. Information to be provided to the Supervisory Board The Management Board shall on its own initiative provide the Supervisory Board, where appropriate: through its committees, with all information, where possible: in writing, which it may need to function properly and to carry out its duties property, including the provision of relevant information to the General Meeting of Shareholders by the Supervisory Board as requested. The information to be provided thus will in any event include written information in a format as agreed from time to time on: a. all matters relating to any of the subjects mentioned in Annex A to these Rules: forthwith: b. all matters to be discussed with the Supervisory Board pursuant to article 8 under a-m: timely before such discussion is held; c. inter alia, the financing, financial situation and developments of the Company and its Group Companies, mergers and acquisitions, material investments and divestments, organizational issues, regulatory developments, compliance by the Company with all relevant laws and regulations and other relevant issues: in any event on a quarterly basis; d. the dealings of the Management Board with the external auditor, including its views on the external auditor's independence (for example, the desirability of rotating the responsible 6

7 partner(s) of the external auditor and the performance of both audit and non-audit work for the Company by the external auditor): annually. Article 10. Rules of Conduct 10.1 Collegiality a. Management Board members shall acknowledge that the authority to manage the Company is vested in the Management Board as a whole, notwithstanding that each of them is responsible and accountable within the Management Board for the specific task(s) which are assigned to him. b. Aside from rules and protocols, it is important that there is an atmosphere of cooperation and agreement, characterized by mutual supportiveness, especially in relation to the provision of the necessary information if all Management Board members are to shoulder their individual and shared responsibilities. c. Each Management Board member shall inform the other Management Board members in a clear and timely manner about any major developments in the area of his responsibilities. Management Board members shall externally express concurring views without jeopardizing the responsibilities of individual Management Board members. d. A Management Board member who is unable to align himself with a decision taken by the Management Board may, after having informed the CEO of his intended actions, bring his views to the attention of the Chairman, giving his reasons Non-competition and integrity A Management Board member shall not: (i) enter into competition with the Company and/or with its Subsidiaries; (ii) demand or accept (substantial) gifts from the Company and/or from its Subsidiaries for him or for his spouse, registered partner or other life companion, foster child or relative by blood or marriage up to the second degree; (iii) provide unjustified advantages to third parties to the detriment of the Company and/or its Subsidiaries; or (iv) take advantage of business opportunities to which the Company, and or its Subsidiaries are entitled for himself or for his spouse, registered partner or other life companion, foster child or relative by blood or marriage up to the second degree Transparency a. In all contacts with the Supervisory Board and its members and committees, the Management Board and its members shall act in an atmosphere of mutual trust and transparency. b. A Management Board member shall report alleged irregularities, relating to the functioning of another Management Board member, if need be anonymously, to the chairman of the Supervisory Board, in accordance with the Whistleblower Procedure of the Company, which is published on the Company s website c. When brought to his attention, a Management Board member shall inform the chairman of the audit committee of issues that may compromise the required independence of the external auditor or that may give rise to a conflict of interest or a potential conflict of interest between the external auditor and the Company and/or its Subsidiaries Confidentiality a. Except as required for a proper discharge of his duties as such, a Management Board member shall not use or disclose (whether directly or indirectly and whether for his own or another person's benefit or purposes) any confidential information belonging to the Company or any Company in which it holds a stake (hereinafter referred to as confidential information ). Confidential information shall include information which relates to the affairs and/or to present or former employees, officers or clients of the Company or any Subsidiary or other Affiliate whether: (i) in form of business plans, developments or dealings, financial information dealings and plans or not; or (ii) marked as confidential, with a similar expression or not. 7

8 b. The confidentiality obligation arising from paragraph 4 shall apply without limitation in time but shall not apply to: (i) any confidential information which is in the public domain other than by way of unauthorized disclosure (whether by the Management Board member or another person); or (ii) any confidential information that the Management Board member may be required to disclose to any statutory authority or competent court or tribunal Inside information Any shareholding in the Company by Management Board members is for the purpose of longterm investment. Management Board members are bound by the policy on inside information and securities trading, which is posted on the Company s website and shall comply with all Dutch and foreign statutory provisions and regulation applicable to the ownership of, and transactions in securities Conflicts of interest a. A Management Board member shall immediately report any conflict of interest or potential conflict of interest that is of material significance to the Company and/or to him, to the chairman of the Supervisory Board and to the other Management Board members and shall provide all relevant information, including information concerning his spouse, registered partner or other life companion, foster child and relatives by blood or marriage upon the second degree. The Supervisory Board shall decide, without the Management Board member concerned being present, whether there is a conflict of interest. b. A Management Board member shall not participate in the discussions and/or decision making process on a subject or transaction in relation to which he/she has a conflict of interest with the company. A conflict of interest exists, in any event, if the Company or any of its Subsidiaries intends to enter into a transaction with another legal entity: (i) in which a Management Board member personally has a material financial interest; (ii) which has a Management Board member who has a relationship under family (iii) law with a Management Board member; or in which a Management Board member has a management or supervisory position. The foregoing does not apply in case the other legal entity is a Subsidiary. Any perceived conflict of interest between the Company and Management Board members shall be avoided to the greatest extent possible. c. All transactions in which there are conflicts of interest with Management Board members shall be agreed on terms that are customary for arm's-length transactions in the relevant branch of business. Decisions to enter into transactions in which there are conflicts of interest with Management Board members that are of material significance to the Company and/or the relevant Management Board members require the approval of the Supervisory Board Outside positions a. Management Board members shall not without prior written permission from the chairman of the Supervisory Board: (i) accept any other executive or non-executive position and/or any position as, managing or supervisory director, agent or receiver for any entity, Company or corporation not being the Company or one of its Subsidiaries or other Affiliates; (ii) conduct a business or pursue an occupation as a self-employed person; (iii) establish or acquire a business for his own account or as an agent of a third party; or (iv) act as counselor or consultant, or perform employment activities for third parties, whether paid or unpaid, for or in respect, or on behalf, of any entity, Company or corporation not being the Company or one of its Subsidiaries or other Affiliates. 8

9 Such permission shall be given only if such function or activity is - in the sole opinion of the chairman of the Supervisory Board - not incompatible with the interests of the Company and/or of its Subsidiaries and/or with principles of corporate governance as these may develop from time to time. Permission for a position as Supervisory Board member of a Company which is not a Subsidiary shall be granted only in very exceptional cases. b. Permission referred to in paragraph a is not required: (i) if the outside position is held on behalf of the Company or fulfilled as an (ii) inherent part of the function; and In the case of a non-profit organization, provided that the Management Board has decided in advance that such position is not incompatible with the interests of the Company. c. Management Board members shall notify to the Supervisory Board all their other important positions besides those referred to in paragraph a. Article 11. Status and contents of these Rules These Rules are complementary to the provisions regarding the Management Board and the Management Board members contained in applicable law and regulation, in the Articles of Association, and the rules pertaining to the relationship between the Management Board and the Supervisory Board contained in the Supervisory Board Rules. Where these Rules are inconsistent with the Supervisory Board Rules, the latter shall prevail. Where these Rules are inconsistent with Dutch law or the Articles of Association, the Articles of Association and Dutch law shall prevail. In case of a conflict between the Supervisory Board Rules and the Articles of Association and/or Dutch law in relation to these Rules, the Articles of Association and/or Dutch law, as the case may be, shall prevail. Article 12. Amendment 12.1 These Rules may be amended by a resolution of the Management Board to that effect, subject to approval by the Supervisory Board. The Management Board shall not propose any amendments to these Rules and/or the Articles of Association that conflict in any way with the relationship agreement entered into between the Company and Cinven and Warburg Pincus and/or with the Supervisory Board Rules The Management Board may incidentally decide by a resolution not to apply one or more provisions of these Rules, subject to approval by the Supervisory Board. Such a resolution is mentioned in the report of the Management Board. Article 13. Governing law and jurisdiction 13.1 These Rules shall be governed by and construed in accordance with the law of the Netherlands The courts of Amsterdam, the Netherlands, shall have exclusive jurisdiction to settle any dispute arising from or in connection with these Rules (including any dispute regarding the existence, validity or termination of these Rules). Article 14. Annexes The following annexes belong to these Rules and are deemed to form an integral part of it: Annex 1: Management Board resolutions which require Supervisory Board approval Thus adopted by the Management Board in its meeting of. and approved by the Supervisory Board in its meeting of.. to become effective as of.. 9

10 Annex A: Management Board resolutions which require Supervisory Board approval Notwithstanding the Management Board resolutions that require the approval of the Supervisory Board pursuant to Dutch law, the Management Board shall submit to the Supervisory Board for approval: (i) (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) the operational and financial objectives of the Company and any material changes thereto; the Company's budget and any material changes thereto; the strategy, policies, long-term plans and risks attached to the business of the Company, including the Strategic Plan, and the parameters to be applied in relation to the strategy, for example in respect of the financial ratios, and any material changes thereto; the risk profile of the Company and any material changes thereto; the main organizational structure of the Company and, considering the assessment made by the Management Board, the design and operation of its internal risk-management and other control systems and any necessary changes or corrective actions to be taken with respect thereto; the design and implementation, both prospective and retrospective, of the remuneration policies applied by the Company and the assessment by the Management Board whether variable incomes are consistent with the applicable remuneration policy of the Company, with special attention for the highest variable incomes, and any material changes thereto; any material retention, exit and welcome packages, with a view to assessing that these are consistent with the Company s remuneration policy so as to ensure that these are not excessive; the Company's dividend policy and any material changes thereto; and corporate social responsibility issues that are relevant to the enterprise. Furthermore, as set out in the Articles of Association of the Company, the Management Board requires the prior approval of the Supervisory Board for the following resolutions: (i) issue and acquisition of shares of the Company and debt instruments issued by the Company or of debt instruments issued by a limited partnership or general partnership of which the Company is a fully liable partner; (ii) application for admission of the securities referred to under (i). to the trade on a regulated market or a multilateral trade facility as described in section 1:1 of the Financial Supervision Act (Wet financieel toezicht) or a similar system compared to a regulated market or multilateral trade facility from a state which is not a member state or the withdrawal of such admission; (iii) entering into or terminating a permanent cooperation of the Company or a dependent company with another legal entity or company or as fully liable partner in a limited partnership or general partnership, if such cooperation or termination is of major significance to the Company; (iv) participation for a value of at least one/fourth of the amount of the issued capital with the reserves according to the most recently adopted balance sheet with explanatory notes of the Company by the Company or by a dependent company in the capital of another company, as well as to a significant increase or reduction of such a participation; (v) investments involving an amount equal to at least the sum of one-quarter of the Company's issued capital plus the reserves of the Company as shown in its balance sheet and explanatory notes; (vi) a proposal to amend the articles of association; (vii) a proposal to dissolve (ontbinden) the Company; (viii) a proposal to conclude a legal merger (juridische fusie) or a legal demerger (juridische splitsing); (ix) application for bankruptcy and for suspension of payments (surseance van betaling); (x) termination of the employment of a considerable number of employees of the Company or of a dependent company at the same time or within a short period of time; (xi) far-reaching changes in the employment conditions of a significant number of employees, management incentive schemes and pension schemes of the Company or of a dependent company; (xii) a proposal to reduce the issued share capital; (xiii) entering into, changing or terminating a contract with an interest that exceed an amount to be determined by the Supervisory Board; 10

11 (xiv) (xv) (xvi) (xvii) (xviii) entering into, changing or settling material litigation, which litigation exceeds an interest with an amount to be determined by the Supervisory Board; entering into, changing or terminating a material financing agreement or seeking waivers there under, which exceeds an interest with an amount to be determined by the Supervisory Board; the appointment or dismissal of a senior manager of the Company; such resolutions as shall be determined and clearly defined by the Supervisory Board and notified to the Management Board in writing; decisions of the Management Board involving a major change in the Company's identity or character are subject to the approval of the Supervisory Board and the General Meeting, including: a. the transfer of the enterprise or practically the whole enterprise to third parties; b. to enter or to terminate longstanding joint ventures of the Company or a subsidiary with another legal entity or company or as fully liable partner in a limited partnership or a general partnership if this joint venture or termination of such a joint venture is of a major significance to the Company; c. to acquire or dispose of a participation in the capital of a company worth at least one third of the amount of the assets according to the balance sheet with explanatory notes thereto, or if the Company prepares a consolidated balance sheet according to such consolidated balance sheet with explanatory notes according to the last adopted annual account of the Company, by the Company or a subsidiary. 11