Merck. Corporation with general partners. Darmstadt - ISIN DE Securities Identification No

Transcription

1 Merck Corporation with general partners Darmstadt - ISIN DE Securities Identification No The shareholders of our company are hereby invited to attend the on Friday, April 8, 2011 at 10:00 a.m. to be held at the Jahrhunderthalle Frankfurt, Pfaffenwiese, Frankfurt am Main Annual General Meeting. Agenda 1. Presentation of the annual financial statements and the management report of Merck KGaA as well as the consolidated financial statements and the management report of the Merck Group for fiscal 2010 and the Report of the Supervisory Board There will be no resolution on agenda item 1 since this only comprises the presentation of the annual financial statements and additional documents. 2. Resolution on the adoption of the annual financial statements of Merck KGaA for fiscal 2010 The General Partners and the Supervisory Board propose that the submitted financial statements of Merck KGaA as at December 31, 2010 be adopted.

2 3. Resolution on the appropriation of the net retained profit for fiscal 2010 The General Partners and the Supervisory Board propose to utilize the portion of net retained profit of Merck KGaA accruing to the shareholders in the amount of EUR 203,171, as follows: a) Payment of a dividend of EUR 1.25 per no par value share of the dividend-bearing share capital as of the date of this Annual General Meeting, being EUR 80,776, in total. b) Carry forward the balance totaling EUR 122,395, to new account Accordingly, pursuant to Article 31 (3) of the Articles of Association of the company, E. Merck KG (hereinafter E. Merck ) must allocate an amount totaling EUR 289,349, to the profit carried forward by Merck KGaA. This obligation was already fulfilled in the reporting period by increasing the 2008 profit carried forward amounting to EUR 77,237, by EUR 212,111, to align it with the new profit carried forward. In the event that the Annual General Meeting resolves to appropriate profits in a way other than that proposed, these amounts must be adjusted accordingly and retransferred, if necessary. The dividend is payable on April 11, Resolution on the approval of the actions of the Executive Board for fiscal 2010 The General Partners and the Supervisory Board propose that the actions of the members of the Executive Board be approved. 5. Resolution on the approval of the actions of the Supervisory Board for fiscal 2010 The General Partners and the Supervisory Board propose that the actions of the members of the Supervisory Board be approved. 6. Resolution on the election of the auditors for fiscal 2011 The Supervisory Board proposes the appointment of KPMG Aktiengesellschaft Wirtschaftsprüfungsgesellschaft, Berlin, as auditor of Merck KGaA for fiscal

3 7. Resolution on the compensation system for Executive Board members By way of the German Act on the Appropriateness of Management Board Compensation (VorstAG), the possibility was created under section 120 (4) German Stock Corporation Act for the General Meeting to approve the compensation system applicable to the Management Board of the company. Many of the rules applicable to German stock corporations do not apply to Merck KGaA, which is a corporation with general partners. This also includes section 120 (4) AktG, since at Merck KGaA in contrast to the situation at stock corporations it is not the Supervisory Board that decides on the compensation of the Executive Board members. Instead, personnel authority at Merck KGaA lies with the Board of Partners of E. Merck KG, upon which the General Meeting of Merck KGaA has no influence. To set the compensation system, the Board of Partners has drawn on the expertise of independent experts and additionally oriented toward market standards. Although there is no legal obligation to do so, Merck KGaA would like to give its shareholders the possibility to express its opinion of the compensation system that applies to the Executive Board, in other words by deciding on a corresponding resolution. The compensation system for Executive Board members is presented in detail in the compensation report, which has been published in the Annual Report for 2010 as part of the Statement on Corporate Governance within the Corporate Governance Report Requirements for participating in the Annual General Meeting and exercising voting rights 1. Registration and evidence of share ownership In accordance with Article 22 (1) and (2) of the Articles of Association of the company, to be eligible to participate in the Annual General Meeting and to exercise voting rights shareholders must register with the company under the following address and submit evidence of share ownership issued by the custodial bank or financial institute to the following address: 3

4 Merck KGaA c/o Deutsche Bank AG Securites Production General Meetings Postfach Frankfurt am Main Fax: Evidence of share ownership must relate to the start of March 18, 2011 ( record date ) and must be received by the company along with the registration no later than April 1, 2011, (24:00 hours), at the aforementioned address. Registration and evidence of share ownership must be in text form (section 126b German Commercial Code) in either German or English. Following receipt of registration and evidence of share ownership, the admission ticket to the Annual Meeting will be sent to the shareholder. In order to ensure the timely receipt of the admission tickets, we kindly request shareholders to be sure to send their registration and evidence of share ownership to the company in a timely manner. 2. Significance of the record date The record date is the date that determines the extent and exercise of participation and voting rights at the Annual General Meeting. In relation to the company, individuals who wish to participate in the Annual General Meeting or to exercise voting rights must be deemed to be shareholders by having submitted evidence of share ownership by the record date. Eligibility to participate or the extent of voting rights is determined exclusively by share ownership on the record date. Changes in share ownership after the record date have no significance here. The record date does not involve a suspension of the ability to sell the shares held. Also in the event of the complete or partial sale of the shares owned after the record date, share ownership on the record date is definitive for participation in and exercising voting rights. This means that the sale of shares after the record date has no impact on eligibility to participate or to exercise voting rights. Shareholders who did not own any shares on the record date, but only purchased them afterward, may therefore only participate in the Annual General Meeting and exercise voting rights if someone authorizes them to do so or grants them power of attorney. The record date is not a relevant date for any dividend entitlement. 3. Voting by proxy Shareholders who do not wish to attend the Annual General Meeting personally may also have their voting rights exercised by proxy, e.g. by a bank or shareholder association, or another third party. The granting of power of attorney, its revocation and documentation of power of attorney visà-vis the company must be made in text form if the proxy authorized to exercise the voting 4

5 right is neither a bank nor a shareholders association or any of the other equivalent institutions or persons in accordance with section 135 (8) and (10) German Stock Corporation Act. If a power of attorney to exercise voting rights is granted to banks, equivalent institutes or entities (sections 135 (10) and 125 (5) German Stock Corporation Act) and shareholders associations or persons as defined by section 135 (8) German Stock Corporation Act, there is no text form requirement. However, the proxy must be able to validate their authorization. In addition, it must be complete and may only refer to the exercise of voting rights. We therefore kindly request shareholders wishing to authorize a bank, a shareholders association or any other equivalent institute, entity or person in accordance with section 135 German Stock Corporation Act to confer with the proxy. To submit evidence of or revoke power of attorney, the company offers shareholders an electronic system at Shareholders can obtain further details by reading the explanations given there. In addition, we continue to offer our shareholders the possibility to exercise their voting rights through a proxy appointed by our company. For this purpose, these proxies must be given the required authorization and instructions on how the votes are to be cast. The proxies are obliged to vote in line with the instructions given to them. Also in the event of representing a shareholder, it is necessary to register the shareholder and to submit evidence of share ownership as described above before the specified deadlines. Prior to the Annual General Meeting, the authorizations and instructions to the proxies appointed by the company can be granted via the Web via an electronic system or in text form. Authorizations and instructions may also be granted or amended via the Web even during the Annual General Meeting until the Chairman of the Executive Board has completed his speech. In the event of authorizing a proxy appointed by the company, it is necessary to register the shareholder and to submit evidence of share ownership as described above before the specified deadlines. Shareholders wishing to authorize a proxy are kindly requested to use the form provided by the company for granting power of attorney. It is printed on the back of the admission ticket that the shareholders receive if they register and provide proof of ownership in time. If the shareholder authorizes more than one person, the company may reject one or more of them. Shareholders will receive further details on participating in the Annual General Meeting as well as on granting authorization and issuing voting instructions together with the admission ticket or by visiting 5

6 Disclosure of rights of shareholders in accordance with sections 122 (2),126 (1), 127, 131 (1) German Stock Corporation Act 1. Additions to the agenda demanded by a minority in accordance with section 122 (2) of the German Stock Corporation Act Shareholders whose shares amount in aggregate to not less than one-twentieth of the share capital or represent an amount of the share capital corresponding to EUR 500,000, may demand that items are put on the agenda and published. Each new item shall be accompanied by an explanation or a draft proposal. Demands for additional items must be provided to the company at least 30 days before the meeting in writing; the day of receipt and the day of the Annual General Meeting shall not be included in this calculation. The last possible date of receipt is March 8, 2011, 24:00 hours. Shareholders demanding additional items must prove that they have owned the shares for at least three months prior to the date of the Annual General Meeting (i.e. since at least January 8, 2011, 0:00 cf. section 122 (2) sentence 1, (1) sentence 3 German Stock Corporation Act in conjunction with section 142 (2) sentence 2 German Stock Corporation Act). Any demands for additional agenda items are to be submitted to the following address: Merck KGaA - HV-Büro - Frankfurter Strasse Darmstadt 2. Motions by shareholders in accordance with section 126 (1) German Corporation Act Every shareholder has the right to submit countermotions at the Annual General Meeting to proposals put forward by General Partners and/or the Supervisory Board regarding a specific agenda item, stating the reasons for the countermotion. Countermotions that the company has received at least 14 days prior to the Annual General Meeting will be made available without delay at When calculating this submission deadline, the date of receipt and the date of the Annual General Meeting are not to be included in the count. Consequently, countermotions must be submitted no later than March 24, 2011, 24:00 hours. The countermotion will be made available together with the name of the shareholder, the grounds for the countermotion, and, where applicable, a statement by management. 6

7 The following address is definitive for the transmission of countermotions: Merck KGaA - HV-Büro - Frankfurter Straße Darmstadt Telefax: 06151/ Any countermotions sent to any other addresses will be disregarded. Countermotions are only deemed to have been made if they are submitted verbally during the Annual General Meeting. This does not affect the right of every shareholder to submit countermotions during the Annual General Meeting regarding various items on the agenda without having transmitted them to the company in advance and before the specified deadline. 3. Election proposals by shareholders in accordance with section 127 German Stock Corporation Act In accordance with section 127 German Stock Corporation Act, the preceding remarks on section 126 (1) German Stock Corporation Act apply correspondingly to proposals by shareholders on the election of the auditor (agenda item 6) with the proviso that grounds for the election proposal need not be given. The Executive Board is not required to make the election proposal available if the proposal does not include the name, profession and place of residence of the auditor proposed for election. When proposing auditors, they are to be designated by their company name and location instead of their name, profession and place of residence. 4. Shareholders right to information in accordance with section 131 (1) German Corporation Act Upon request, every shareholder will be provided with information by the Executive Board at the Annual General Meeting regarding the company s affairs, to the extent that such information is necessary to permit a proper evaluation of the relevant agenda item. The duty to provide information also extends to the company s legal and business relations with any affiliate as well as to the situation of the Group and the entities included in the consolidated financial statements. 7

8 Under certain conditions (section 131 (3) German Stock Corporation Act), the Executive Board may refuse to provide information. A detailed presentation of these conditions can be found in German at: 5. Further explanations Further explanations on the aforementioned shareholder rights in accordance with sections 122 (2), 126 (1), 127 and 131 (1) German Stock Corporation Act can be found on the aforementioned website of the company (only in German). Reference to the company s website This notice of the Annual General Meeting, the documents that are required to be made available to the Annual General Meeting and further information relating to the Annual General Meeting can be downloaded from the following website once the Annual General Meeting has been convened The documents that are required to be made available will also be available during the Annual General Meeting. Any countermotions, nominations of candidates for election and demands for items to be included on the agenda will also be made available on the aforementioned website. Total number of shares and voting rights on the date when the AGM is convened As of the date on which the General Meeting is convened, the subscribed capital of the company amounts to EUR 168,014, (in words: one hundred sixty-eight million fourteen thousand nine hundred twenty-seven euros and twenty cents), divided into 64,621,125 shares no par value bearer shares plus one registered share. Each of the total number of 64,621,126 shares grants the holder one vote, which means as of the date on which the General Meeting is convened, 64,621,126 voting rights existed. Broadcasting of the Annual General Meeting on the Web As authorized by the Chairman of the Meeting, all shareholders of Merck KGaA as well as interested members of the public can follow the Annual General Meeting live on the Web at on April 8, 2011 from 10 a.m. until the Chairman of the Executive Board completes his speech. The speech by the Chairman of the Executive Board as well as the voting results will likewise be published on the aforementioned website after the Annual General Meeting. 8

9 The notice of this Annual General Meeting was published on February 24, 2011 in the electronic Federal Gazette and was forwarded to those media that can be assumed to disseminate information throughout the entire European Union. Darmstadt, February 24, 2011 Merck Kommanditgesellschaft auf Aktien The Executive Board 9