Explanatory Notes to the Business of the Annual General Meeting
Resolutions 1 to 4 - Approval of Financial Statements
The Management Board proposes that the Annual General Meeting, after having reviewed the management report of the Management
Board and the report of the independent auditor, approve: - |
the consolidated accounts for the financial year ended 31 December 2020 in their entirety, showing a consolidated net loss
of EUR 112.4 million
; | - |
the annual accounts for the financial year ended 31 December 2020 in their entirety, showing a net loss
of EUR 43.7 million
; | - |
allocation of the results of the Company based on the stand-alone annual accounts of the Company prepared in accordance with
IFRS for the financial year ended 31 December 2020 as follows: | - |
Results of the financial year 2020: EUR 43.7 million | - |
Losses brought forward: EUR 2,273.2 million |
Resolutions 5 to 7 - Discharge of Members of the Management Board
The Management Board proposes that the Annual General Meeting approve that discharge be granted to each member of the Management
Board, for the execution of their mandates during the financial year ended 31 December 2020.
Resolutions 8 to 13 - Discharge of Members of the Supervisory Board
The Management Board proposes that the Annual General Meeting approve that discharge be granted to each member of the Supervisory
Board, for the execution of their mandates during the financial year ended 31 December 2020.
Resolution 14 - Acknowledgment of the resignation of Alexis Babeau as member of the Supervisory Board and appointment of Philipp
Povel as a member of the Supervisory Board
The Management Board proposes that the Annual General Meeting appoint Philipp Povel as member of the Supervisory Board for
a period ending at the expiration of the general meeting of shareholders approving the annual accounts for the financial year
ending 31 December 2021.
Philipp Povel is a co-founder and the former Chief Executive Officer of dafiti, having served in this role for over ten years,
and brings with him a wealth of experience and knowledge of the Company and its business. The biographical information of
Philipp Povel is available on the Company's website at https://ir.global-fashion-group.com/agm |
The Management Board informs the Annual General Meeting of the resignation of Alexis Babeau, conditional upon the appointment
of Philipp Povel to the Supervisory Board and effective from the end of this Annual General Meeting.
Resolution 15 - Reappointment of Auditor
The Management Board proposes that the Annual General Meeting appoint the auditing firm Ernst & Young as independent auditor
(réviseur d'entreprises agréé) to perform the independent audit of the Company regarding the financial year 2021.
Resolution 16 - Presentation of and advisory vote on the remuneration report for the members of the Management Board and the
Supervisory Board
The Management Board proposes that the Annual General Meeting pass an advisory vote on the remuneration report for the members
of the Management Board and the Supervisory Board.
Resolution 17 - Presentation of and advisory vote on the revised remuneration policy for the members of the Management Board
and the Supervisory Board
The Management Board proposes that the Annual General Meeting pass an advisory vote on the remuneration policy for the members
of the Management Board and the Supervisory Board.
The Company has revised its remuneration policy for the Management Board and the Supervisory Board, as previously approved
by the shareholders on 26 June 2020, and submits it to the advisory vote of the Annual General Meeting as required by Article
7bis of the Luxembourg law of 1 August 2019 amending the Luxembourg law of 24 May 2011 on shareholders rights and which became
effective on 24 August 2019 (the 'Shareholders Rights Law
'). The proposed changes relate exclusively to the remuneration system of the members of the Management Board and take into
consideration the revisions of the German Corporate Governance Code and consists of updates to certain aspects of the Company's
remuneration system and administration.
Resolution 18 - Remuneration of Members of the Supervisory Board
The Management Board proposes that the Annual General Meeting approve the remuneration for the members of the Supervisory
Board for the 2021 financial year as follows:
Supervisory Board: | Supervisory Board
|
Audit Committee |
Sustainability Committee
| Chairman |
EUR 45,000 (cumulative with Member fee)
|
EUR 40,000 (cumulative with Member fee)
|
EUR 35,000 (cumulative with Member fee)
| Vice Chairman |
EUR 25,000 (cumulative with Member fee)
|
n/a |
n/a | Member |
EUR 35,000 |
EUR 10,000 |
EUR 10,000 |
The Chairman of the Supervisory Board and the Vice Chairman of the Supervisory Board shall be entitled to their fee as Chairman
and Vice Chairman respectively, along with the fee for being a member of the Supervisory Board.
Resolution 19 - Authorisation for the Management Board to repurchase up to 20% of the total number of common shares of the
Company issued on the date of the Annual General Meeting within a period of five (5) years as from the date of the Annual
General Meeting
The Management Board proposes that the Annual General Meeting authorise and delegate all necessary powers to the Management
Board to acquire up to 20% of the total number of common shares of the Company issued on the date of the Annual General Meeting
for a price which may not exceed by more than 15% the highest of: i. |
the volume weighted average price (VWAP) in Xetra trading (or a corresponding successor system) of the common shares of the
Company over the three trading days in Frankfurt am Main preceding the day of the decision of the Management Board (or any
one of its delegates) to repurchase; or | ii. |
the opening trading price of the common shares of the Company in Xetra trading on the day of the decision of the Management
Board (or any one of its delegates) to repurchase (the 'Buyback
'). |
The Buyback shall occur in one or several transactions without cancellation of the acquired shares and without prejudice to
i) the principle of equal treatment of all shareholders who are in the same position and ii) the applicable market abuse rules.
The Annual General Meeting shall further authorise the Management Board to take all measures and execute any formalities which
may be necessary in relation to the BuyBack.
Resolution 20 - Restatement and renewal of the authorised capital of the Company, waiver of the preferential subscription
right of existing shareholders where expressly provided in the special report of the Management Board and amendment of articles
6.1 and 6.2 of the articles of association of the Company
The Management Board proposes that the Annual General meeting approve a restatement and renewal of the authorised capital
of the Company. The Management Board has utilised some, but not all, of the previously authorised capital on a number of occasions,
in the best interests of the Company and its shareholders and now wishes to restate and renew the Company's authorised capital.
The Management Board would like to draw attention to the importance of the Company being able to act quickly and have flexibility
in increasing the share capital of the Company, according to the needs of the Company. The protracted procedure of convening
an extraordinary general meeting in order to offer shares to shareholders on a pre-emptive basis, as well as the resulting
publicity and costs involved in convening such an extraordinary general meeting, may be incompatible with the Company's needs
and could result in missed opportunities for the Company.
As a result of the above, the Management Board proposes that the Annual General Meeting approves an increase of the Company's
authorised capital to 215,000,000 common shares, with the authorised capital lasting for a period of five (5) years from the
date of the Annual General Meeting with the possibility to issue up to 118,615,000 new common shares without reserving a preferential
subscription rights to the existing shareholders of the Company.
The Management Board also notes that the authorisation to issue up to 118,615,000 new common shares without reserving a preferential
subscription rights to the shareholders will allow the Management Board to, among other things, convert or grant the right
to convert any present or future convertible instruments, including the convertible bonds issued by the Company in March 2021,
into shares issued by the Company, satisfy the Company's obligations under its management incentive plans and to use the authorised
capital for general corporate purposes, including but not limited to, raising funds required to meet the Company's financing
and refinancing needs without delay and seizing opportunities in potential merger & acquisition transactions by enabling the
Company to acquire shares and other assets on the best possible terms at short notice.
The proposed authorised capital shall apply to rights, options, warrants, convertible instruments and other securities, restricted
stock units, or other equity-based awards or rights to subscribe to or receive shares issued prior to the date of the Annual
General Meeting as well as apply, to the extent not used yet, to rights issued thereupon, notably under any existing management
incentive scheme or other contractual documentation entered into by the Company.
Finally, as a consequence of the above, articles 6.1 and 6.2 of the Company's articles of association shall be amended and
shall read as follows:
'6.1 The Company's authorised capital, excluding the issued share capital, is set at two million one hundred fifty thousand
euro (EUR 2,150,000), represented by two hundred fifteen million (215,000,000) common shares having a nominal value of one
cent (EUR 0.01) each.
6.2 During a period of five (5) years from the date of any resolutions to create, renew or increase the authorised capital
pursuant to this article, the management board with the consent of the supervisory board, is hereby authorised to issue common
shares, rights, options, warrants, convertible instruments and other securities, restricted stock units, or other equity-based
awards or rights to subscribe to or receive shares or grant rights to convert instruments into shares (whether on a regulated
or unregulated market), for contributions in cash and/or in kind, within the limits of the authorised capital to such persons
and on such terms as set forth in the special report of the management board dated 20 April 2021 as may be amended from time
to time on the authorised capital and specifically to proceed with the issue of up to one hundred eighteen million six hundred
fifteen thousand (118,615,000) shares without reserving a preferential right to subscribe to the shares issued for the existing
shareholders subject to the limitations set forth in the special report of the management board dated 20 April 2021 as may
be amended from time to time and it being understood, that any issuance of such instruments will reduce the available authorised
capital accordingly.'
Resolution 21 - Approval of the amendment of article 15.2 of the articles of association of the Company to amend the term
of office of members of the Management Board
The Management Board proposes that the Annual General Meeting pass a resolution to reduce the term of office of members of
the Management Board from five (5) years to three (3) years, which will only apply to any new appointments to the Management
Board and to any renewals of the terms of the current members of the Management Board. The current terms of office of the
existing members of the Management Board will not be affected.
The amendment is being proposed in accordance with the recommendations of the Federal German Government Commission in the
revised German Corporate Governance Code which was published in March 2020, which the Company has voluntarily decided to comply
with.
The new article 15.2 will read as follows:
'15.2 The term of office of a member of the management board may not exceed three (3) years, it being understood that the
term of the mandate of the members of the management board appointed prior to 26 May 2021 may be up to five (5) years. Members
of the management board may also be reappointed for successive terms.'
Resolution 22 - Approval of the deletion of transitory provisions covering the conversion of common shares of the Company
into dematerialised shares and subsequent deletion of article 7.5 and articles 28.1 to 28.5 of the articles of association
of the Company
The Management Board proposes that the Annual General Meeting pass a resolution to delete transitory provisions related to
the conversion of common shares of the Company into dematerialised form.
Considering that the entire outstanding share capital of the Company is now composed of dematerialised shares, the Management
Board proposes that the Annual General Meeting approve the deletion of article 7.5 and articles 28.1 to 28.5 of the articles
of association of the Company, the purpose of which was to cover the conversion of common shares of the Company from their
initial registered form into dematerialised form and has now been fulfilled. |