INVITATION TO THE ANNUAL GENERAL MEETING OF SIKA AG. Tuesday, April 14, p.m., at the Waldmannhalle, Baar Doors open: 1 p.m.

Transcription

1 INVITATION TO THE ANNUAL GENERAL MEETING OF SIKA AG Tuesday, April 14, p.m., at the Waldmannhalle, Baar Doors open: 1 p.m. 1

2 DEAR SHAREHOLDERS, The Board of Directors is pleased to invite you to the Annual General Meeting of Sika AG, to be held on Tuesday, April 14, 2015 at 2 p.m. at the Waldmannhalle, Baar. AGENDA AND PROPOSALS BY THE BOARD OF DIRECTORS 1. APPROVAL OF THE ANNUAL REPORT, ANNUAL FINANCIAL STATEMENTS AND CONSOLIDATED FINANCIAL STATEMENTS FOR 2014 Proposal by the Board of Directors. On the basis of the Report of the Statutory Auditors, the Board of Directors proposes unanimously that the annual report, the annual financial statements and the consolidated financial statements for the year 2014 be approved. Notes. The report of the Board of Directors and Group Management is included in the annual report, which may be obtained by shareholders and is also available on the Internet at under the heading Publications. All holders of registered shares who are entered in the share register also automatically receive the annual report. The income statement of Sika AG shows revenues of CHF million and expenses of CHF million, yielding a net profit for the year of CHF million. The balance sheet total decreased by CHF million to CHF million. Shareholders equity amounted to CHF million at the end of the year. The consolidated financial statements show a net profit of CHF million. An operating profit of CHF million and cash flow from operating activities of CHF million were generated on net sales of CHF million. In its reports to the Annual General Meeting, Ernst & Young AG recommends that the annual financial statements of Sika AG and the consolidated financial statements be approved. In the opinion of the auditors, the consolidated financial statements give a true and fair view of the Group s assets, financial situation and earnings in accordance with the International Financial Reporting Standards and comply with Swiss law. 2. APPROPRIATION OF THE RETAINED EARNINGS OF SIKA AG Proposal by the Board of Directors. The Board of Directors proposes to the Annual General Meeting by a majority the following appropriation of retained earnings: in CHF mn Composition of retained earnings Net profit for the year Profit brought forward Total at the disposal of Annual General Meeting Dividend payment Dividend payment out of retained earnings¹ Retained earnings carried forward Dividend payment for shares entitled to dividends (without treasury shares as at December 31, 2014). Notes. No allocation was made to the general statutory reserve as it currently already exceeds 20% of the share capital. On approval of this proposal, the following dividend will be paid, representing a 26.3% increase on the previous year's distribution: in CHF Gross dividend 35% withholding tax Net dividend Bearer share² nominal value CHF Registered share nominal value CHF ² Bearer shares held by Sika AG are not entitled to vote and do not qualify for a dividend. Payment of the dividend is expected to occur on Monday, April 20, 2015 upon presentation of coupons no. 25 for bearer shares. Registered shareholders will receive payment at the address provided to the company for purposes of dividend distribution. 2

3 3. GRANTING DISCHARGE TO THE ADMINISTRATIVE BODIES Proposal by the Board of Directors. The Board of Directors proposes unanimously that the members of the administrative bodies be discharged, subject to the outcome of any Special Audit (see agenda item 6.2). 4. ELECTIONS 4.1 Re-election of the Board of Directors Proposal by the Board of Directors. The Board of Directors proposes by a majority that the following be re-elected to the Board of Directors for a term of office of one year: Paul J. Hälg as member Urs F. Burkard as member (representing holders of registered shares) Frits van Dijk as member (representing holders of bearer shares) Willi K. Leimer as member Monika Ribar as member Daniel J. Sauter as member Ulrich W. Suter as member Jürgen Tinggren as member Christoph Tobler as member Notes. Ms. Ribar and Messrs. Hälg, van Dijk, Sauter, Suter and Tobler will only accept their election subject to all of them being re-elected and Mr. Hälg also being re-elected as Chairman of the Board of Directors. 4.2 New election to the Board of Directors Proposal by Schenker-Winkler Holding AG. Schenker-Winkler Holding AG proposes that Dr. Max Roesle be elected to the Board of Directors for a term of office of one year. Response of the Board of Directors. The Board of Directors recommends by a majority that the proposal by Schenker-Winkler Holding AG be rejected. 4.3 Election of Chairman Proposal by the Board of Directors. The Board of Directors proposes by a majority that Paul J. Hälg be re-elected Chairman of the Board of Directors for a term of office of one year Proposal by Schenker-Winkler Holding AG. Schenker-Winkler Holding AG proposes that Max Roesle be elected Chairman of the Board of Directors for a term of office of one year. Notes. The Board of Directors recommends by a majority that the proposal by Schenker-Winkler Holding AG be rejected. Mr. Hälg will only accept his election if Ms. Ribar and Messrs. van Dijk, Sauter, Suter and Tobler are re-elected to the Board of Directors. 4.4 Re-election of the Nomination and Compensation Committee Proposal by the Board of Directors. The Board of Directors proposes by a majority that the following be re-elected to the Nomination and Compensation Committee for a term of office of one year: Frits van Dijk Urs F. Burkard Daniel J. Sauter Notes. Messrs. van Dijk and Sauter will only accept their election if both of them, or, in their place, Ms. Ribar or Messrs. Suter or Tobler, are re-elected to the Nomination and Compensation Committee. 4.5 Election of Statutory Auditors Proposal by the Board of Directors. The Board of Directors proposes unanimously that Ernst & Young AG be appointed statutory auditors for the 2015 financial year. 4.6 Election of Independent Proxy Proposal by the Board of Directors. The Board of Directors proposes unanimously that Dr. Max Brändli, attorney-at-law in Zug, be appointed independent proxy until the close of the next Annual General Meeting. 3

4 5. COMPENSATION 5.1 Consultative vote on Compensation Report 2014 Proposal by the Board of Directors. The Board of Directors proposes unanimously that the Compensation Report 2014 be approved (non-binding consultative vote). Notes. The Compensation Report incorporates the basic principles for the compensation of the Board of Directors and Group Management as well as the remuneration of the members of these two corporate bodies for the 2014 financial year. The Board of Directors is submitting the Compensation Report to shareholders for a consultative vote. The Compensation Report can be found on pages 60 to 76 of the Annual Report. The Annual Report can be accessed on the Internet at under the heading Publications. 5.2 Approval of the future compensation of the Board of Directors Proposal by the Board of Directors. The Board of Directors proposes unanimously that a maximum total amount of CHF 3 million in compensation for the nine-member Board of Directors be approved for a term of office of one year until the close of the next Annual General Meeting. Notes. The proposed total amount is unchanged from the previous year. The total amount includes base compensation as well as remuneration for work on the two Board committees, and is expected to break down as follows: in TCHF Fixed compensation Share-based compensation Social security contributions Total Includes base compensation, committee remuneration and lump-sum representation expenses (Chairman of Board of Directors). 2 Market value on grant date (start of year of office, Annual General Meeting 2015). The figure given here does not reflect any change in share price between the grant date and definitive allocation (end of year of office, Annual General Meeting 2016). 3 Contains expected employer contributions to social security in respect of fixed and share-based compensation (based on market value on grant date). The compensation actually paid will be disclosed in the 2015 and 2016 Compensation Report and submitted to shareholders for a consultative vote. Approval of the maximum total amount of compensation for members of the Board of Directors is in accordance with Art. 11 of the Articles of Association and in accordance with the Ordinance against Excessive Compensation in Listed Companies. Further details on the principles of compensation for the Board of Directors can be found in the Compensation Report. 5.3 Approval of the future compensation of Group Management Proposal by the Board of Directors. The Board of Directors proposes unanimously that a maximum total amount of CHF 18 million in compensation for the nine-member Group Management be approved for the business year Notes. The proposed total amount is unchanged from the previous year. The total amount comprises fixed compensation including employer contributions to social security and pension funds (BVG), the maximum amount of the performance bonus as well as the maximum Performance Share Unit allocation under the long-term participation plan, valued on the allocation date. The total amount is expected to break down as follows: in TCHF Fixed compensation Performance bonus Performance Share Units (PSUs) Total Includes fixed compensation and expected employer contributions to social security (based on the above maximum amounts and the market value of the Performance Share Units on the allocation date) and employer contributions to pension funds (BVG). 2 Maximum value of bonus payout based on the assumption that all performance targets up to the maximum payout multiplier have been reached. 3 The allocation of Performance Share Units is calculated on the basis of the determined amount of the allocation and the share price on the allocation date. The figure given here assumes maximum target attainment, which results in the target number of originally allocated Performance Share Units being multiplied by a maximum payout multiplier of 100%. The figure given here does not factor in share price changes during the vesting period (period between allocation and acquisition of title). 4

5 The compensation actually paid will be disclosed in the 2016 Compensation Report and submitted to shareholders for a consultative (non-binding) vote at the 2017 Annual General Meeting. Approval of the maximum total amount of compensation for members of Group Management is in accordance with Art. 11 of the Articles of Association and in accordance with the Ordinance against Excessive Remuneration in Listed Companies. Further details on the principles of compensation for Group Management can be found in the Compensation Report. 6. SEPARATE PROPOSALS BY SHAREHOLDERS 6.1 Proposal by Ethos to delete the Opting out Clause Proposal by the shareholder group led by the Ethos Foundation. The shareholders Ethos Foundation, Aargauische Pensionskasse, Bernische Pensionskasse (BPK), CIEPP Caisse Inter-Entreprises de prévoyance professionnelle, complan, Luzerner Pensionskasse (LUPK), Anlagestiftung der Migros-Pensionskasse, Pensionskasse Basel-Stadt, Pensionskasse Stadt Zürich, Pictet Funds SA (Ethos), Vontobel Fonds Services AG (for Raiffeisen Futura Swiss Stock) and Vontobel Fonds Services AG (for Vontobel Fund (CH) Ethos Equities Swiss Mid & Small A) submit the following proposal: «Deletion of Article 5: 5. Public Purchase Offer Opting out An acquirer of shares of the Company is not obliged to make a public purchase offer pursuant to Art. 32 and 52 of the Swiss Law on Stock Exchanges and securities trading.» Notes of the shareholder group. As they stand, Sika AG's Articles of Association include an opting out clause. This means that an investor who acquires more than a third of the voting rights is not obliged to make a public offer to purchase the rest of the capital. The combination of this opting out clause with the fact that there are two categories of shares have prompted the Burkard family to propose to Saint-Gobain the sale of their holding in the capital of Sika AG (which is indirectly held by Schenker-Winkler Holding AG) at a premium of approximately 80% relative to the share price. The proposal calls for the deletion of the opting out clause, as it severely punishes minority shareholders in the event of the controlling shareholders selling their shares. If the opting out clause is deleted, the purchaser of the Burkard family's indirect holding in Sika AG will be obliged to make a public offer for the entire capital of Sika AG. Moreover, the offer must be made at the same conditions for all shareholders, as a controlling premium is forbidden under the Federal Act on Stock Exchanges and Securities Trading (SESTA). Response of the Board of Directors. The Board of Directors recommends by a majority that this proposal be approved. 6.2 Proposal by shareholder group Cascade/Bill & Melinda Gates Foundation Trust/Fidelity/Threadneedle requesting a Special Audit Proposal by the shareholder group Cascade/Bill & Melinda Gates Foundation Trust/Fidelity/Threadneedle. The shareholders Cascade Investment, L.L.C., Bill & Melinda Gates Foundation Trust, Fidelity Worldwide Investment and Threadneedle Investments submit the following proposal: «The general meeting resolves to conduct a special audit pursuant to Art. 697a et seq. of the Swiss Code of Obligations regarding the questions of: (i) whether within the 24 months prior to the general meeting, non-public information regarding Sika AG («Company»), in particular, but not limited to, its business, prospects and financial situation, was made available by the Company, including in particular by the board representatives of Schenker-Winkler Holding AG to its shareholder Schenker-Winkler Holding AG («Holding»), the selling shareholders of Holding or to Compagnie de Saint-Gobain or any persons or entities affiliated or related to or acting on behalf of it (together «Saint-Gobain»); (ii) whether there are, or have been made within the 24 months prior to the general meeting, any arrangements, legal or otherwise, between, or involving, the Company and/or its board members (in particular the board representatives of Holding) and/or Holding and/or Saint-Gobain that are, or could be, relevant in the context of a potential direct or indirect sale of shares in the Company or of shares in Holding; (iii) whether and to what extent board members of the Company (in particular the board representatives of Holding) or executives of the Company were and/or are involved in the negotiations with Saint-Gobain regarding the acquisition of Holding by Saint-Gobain or any matters related thereto.» 5

6 Notes of the shareholder group. The requesting shareholders reserve the right to modify the motion at the general meeting following the exercise of their right of information. The requesting shareholders remain troubled by the background of the events leading up to the announcement of the transaction with Saint-Gobain and believe it warrants an investigation. The special audit request focuses on whether any non-public information regarding Sika AG was made available to Saint-Gobain and whether any Board members of the Company had knowledge or were involved in the sales process. Response of the Board of Directors. The Board of Directors recommends unanimously that this proposal be approved Proposal by shareholder group Cascade/Bill & Melinda Gates Foundation Trust/Fidelity/Threadneedle requesting the appointment of Special Experts Proposal by shareholder group Cascade/Bill & Melinda Gates Foundation Trust/Fidelity/Threadneedle. The shareholders Cascade Investment, L.L.C., Bill & Melinda Gates Foundation Trust, Fidelity Worldwide Investment and Threadneedle Investments submit the following proposal: «1. Each of Peter Montagnon, British citizen, born 1950, Associate Director of the Institute of Business Ethics and committee member of other governance organizations, Peter Spinnler, Swiss citizen, born 1946, member of numerous boards and committees of governance organizations, and Jörg Walther, Swiss citizen, born 1961, attorney-at-law and member of the board of various listed and privately held companies, is appointed as special expert in accordance with Art. 731a (3) of the Swiss Code of Obligations (each a «Special Expert» and together the «Special Expert Committee») to review and investigate the future conduct of business of Sika AG (the «Company») and its subsidiaries (the «Sika Group») relating to Schenker-Winkler Holding AG and its affiliates and other closely related persons («Family Shareholder») and/or the Compagnie de Saint-Gobain and its affiliates and other closely related persons («Saint-Gobain») and its effect on the Sika Group and the Public Shareholders (as defined below). 2. The term of office of each Special Expert shall begin upon the chairman of the general meeting declaring that this resolution has been adopted and shall continue until the annual general meeting 2017 or, in case of an extension of the mandate approved by the general meeting, any later date determined by the general meeting. 3. The Special Expert Committee is instructed and authorized to: a) review and investigate the business conduct of the Sika Group, in particular all plans, decisions, actions, agreements, business opportunities, etc. that are actually or potentially related to the Family Shareholder and/or Saint-Gobain or any of their representatives or advisers; b) access all records and information of the Sika Group (e.g. board minutes, board materials, confidential reports, plans and projects, correspondence, communication, drafts of such documents etc.); c) request any information from any member of the board of directors, officer, employee or advisor of the Sika Group; d) inform the shareholders about its activities and findings at each general meeting and report at least twice per year, i.e. at least once between two annual general meetings (interim report) and at least 50 days in advance of the annual general meeting, by way of a written report. During the Limited Activity Status (as defined below) no such report is required, but the Special Expert Committee shall in any event be present or represented by at least one of its members at any general meeting of the Company. The Special Expert Committee may issue press releases and additional reports from time to time, as it deems appropriate. Press releases and reports shall be published on the website of the Company or of the Special Expert Committee; when reporting, the Special Expert Committee shall respect the business secrets (Art. 697e of the Swiss Code of Obligations by analogy); and e) enforce its rights to fulfill its mandate and to take all actions required to safeguard proper fulfillment of its mandate. In particular, if a Special Expert dies, resigns, or, for health reasons, becomes permanently incapable to fulfil his/her mandate, the remaining Special Experts shall appoint a suitable individual as replacement Special Expert. He/she shall have all powers and duties of a Special Expert immediately upon his/her appointment, but such appointment shall be subject to confirmation at the next general meeting of the Company.. 6

7 4. The Special Expert Committee shall organize itself and appoint its own legal, financial and other advisors as it deems appropriate to fulfill its mandate. The Company shall remit an advance of CHF 1,000,000 to the Special Expert Committee to cover its expenses. The Special Expert Committee shall have wide discretion to manage its affairs. In the event of any uncertainty as regards the scope of the Special Expert Committee's powers and authority, it shall interpret its mandate and authority broadly. 5. The board of directors shall ensure that the Special Expert Committee is able to conduct its reviews and investigations. If a member of the board of directors, officer, employee or advisor does not fully comply with a request of the Special Expert Committee, the chairman of the board of directors or, if not available, each other member of the board of directors shall immediately take all necessary action in order to ensure the prompt co-operation of the non-compliant person with the Special Expert Committee s request. 6. Each Special Expert shall be entitled to receive a general fee of CHF 160,000 (the «General Fee») for the period from one annual general meeting to the next annual general meeting (the «Fee Period»). If the Special Expert spends more than 25 working days in the performance of his/her duties under the mandate during the Fee Period, the additional work shall be compensated accordingly. If the Limited Activity Status (as defined below) continues for more than half of the Fee Period, the General Fee shall be reduced for the relevant Fee Period by 50%, provided, that the Special Expert does not spend more than 10 working days in total in the performance of his/her duties under the mandate during such Fee Period. 7. As long as the board of directors, subsequent to the annual general meeting 2015, continues to consist of a majority of Public Shareholders Approved Directors (as defined below) the Special Expert Committee shall remain inactive (the «Limited Activity Status»). As soon as the board of directors no longer consists of a majority of Public Shareholders Approved Directors the Special Expert Committee shall become active and make full use of its power and authority. A member of the board of directors is deemed a «Public Shareholders Approved Director» if (a) he/she is Independent (as defined below), (b) he/she has been elected by a majority of the votes of the Public Shareholders represented at the relevant general meeting, (c) he/she is capable of actively serving as a member of the board of directors (i.e. attend board meetings etc.) and, (d) no Public Shareholder(s) holding more than 3% of the voting rights of the Company has/have publicly announced that it/they will request his/her removal or non-re-election at a future general meeting. A «Public Shareholder» shall be a shareholder of the Company other than the Family Shareholder and Saint-Gobain and any person acting in concert with them. A person shall be deemed «Independent» if the current board of directors or a newly composed board of directors, provided it consists of a majority of Public Shareholders Approved Directors, determines that he/she is sufficiently independent from the Family Shareholder and/or Saint-Gobain.» Notes of the shareholder group. The Company's current capital structure enables the Burkard family to control 52% of voting rights with as little as 16% of the share capital, through the Burkard family s ownership of unlisted registered shares. If the publicly announced indirect sale of all Sika shares held by the Burkard family to Saint-Gobain closes, the majority of voting rights in the Company will be transferred. Consequently, Saint-Gobain will, inter alia, have the power to install and control a new board of directors. Absent adequate corporate governance protections, the future management of the Company could find itself having to negotiate conflicts of interest situations which, if not managed correctly, could disadvantage Sika's business and the interests of the large majority of the Company s (public) shareholders. The appointment of a Special Expert Committee serves to establish a control body, tasked with reviewing the future business conduct of the Company s board of directors in order to identify and mitigate conflicts of interest and resulting disadvantages to the majority of the shareholders. Under Swiss law, special experts can be put in place to allow for the review of a company's business conduct. Such special experts can be appointed by the majority of the share capital represented at the general meeting, i.e. without regard to the enhanced voting power of the registered shares. Thus, this body is particularly well suited for situations as this one. If this proposal is accepted by the general meeting, the three proposed candidates will be appointed as Special Experts with immediate effect for a term of two years, i.e. until the annual general meeting in They will form the Special Expert Committee tasked with the review of the Company's business conduct in relation to the Family Shareholder and Saint-Gobain. 7

8 The Special Expert Committee will remain inactive as long as the majority of the members of the board of directors consists of persons that are independent from the Family Shareholder and Saint-Gobain. It will become active should the board composition change in such a way that this condition is no longer satisfied. Response of the Board of Directors. The Board of Directors recommends by a majority that this proposal be approved. 8

9 FURTHER INFORMATION Issue of the annual report. The 2014 annual report of Sika AG comprising the annual report, the annual and consolidated financial statements and report of the statutory auditors, will be available for inspection by shareholders from March 23, 2015 at the company s registered offices at Zugerstrasse 50, 6341 Baar. Any shareholder can demand that a copy of these documents be issued to him forthwith. The annual report is sent to registered shareholders automatically; holders of bearer shares may obtain the annual report from Sika AG, phone Attendance at the Annual General Meeting. Only those holders of registered shares entered in the share register as at April 9, 2015 are entitled to vote at the Annual General Meeting. Individual admission cards will be sent to them two weeks prior to the Annual General Meeting. No further registrations of voting rights will be carried out in the period from April 10 to April 14, Registered shareholders who were registered with voting rights as at April 10, 2015, but who sold their shares prior to the Annual General Meeting, must surrender their shareholder rights in respect of the shares sold. At the entrance, they will receive a new admission card corresponding to their current holding of shares. Holders of bearer shares wishing to attend, or have themselves represented at, the Annual General Meeting may obtain their admission card from their custodian bank between March 23 and April 9, 2015 at the latest. Holders of bearer shares who have not deposited their shares with a custodian bank will receive their admission card directly at the Annual General Meeting upon presentation of their shares or share certificates. The custodian banks will obtain the admission cards through SIX SAG AG, Sika AG, P.O. Box, CH-4601 Olten, phone , fax , rafael.franzi@six-group.com, by submitting a blocking confirmation and will then send the admission cards to the shareholders. The shares in question will remain blocked until after the end of the Annual General Meeting. Representation by proxy at the Annual General Meeting. Shareholders not attending the Annual General Meeting in person may appoint a proxy. Shareholders wishing to appoint the independent proxy are requested to submit their admission card, including power of attorney and written voting instructions, to Dr. Max Brändli, attorney-at-law, BKS Advokatur Notariat, Alpenstrasse 2, 6301 Zug, at the latest by 12 noon on April 13, Remote electronic voting by issuing authorizations and instructions to the independent proxy. Shareholders may cast their votes remotely by issuing electronic authorizations and instructions to the independent proxy at investor.sherpany.com. The necessary login data is enclosed with the meeting materials supplied to shareholders. Shareholders thus have the option of voting in person, through a proxy, or remotely by issuing electronic authorizations and instructions to the independent proxy. Shareholders may use the online proxy voting, or change any instructions they may have issued electronically, up to but no later than 23:59 on Friday, April 10, Baar, March 23, 2015 Sincerely, Sika AG On behalf of the Board of Directors Dr. Paul Hälg, Chairman 9

10 Chur Sihlbrugg Blickensdorf Waldmannhalle Baar Baar Baar Zentrum Cham Luzern Inwil Zug VENUE Waldmannhalle, Neugasse 55, 6340 Baar CATERING We regret that due to the increased number of attendees at this year's Annual General Meeting of Sika AG, it will not be possible to provide a seated dinner this year. However, you are most welcome to attend the buffet that will be served after the meeting. HOW TO GET THERE By car: Exit A4a, direction Baar By public transport: Take the S-Bahn from Zug or Lucerne to Baar. Doors open at 1 p.m. Between 12:30 and 1:45 p.m. a bus service will be provided from Baar station. A return service will be available between approximately 6 p.m. and 9:30 p.m. 10 SIKA AG Zugerstrasse Baar Switzerland Telephone: Fax: sikagroup@ch.sika.com