Varengold Bank : Agenda / Invitation to the Annual General Meeting 2022
VG8.DE
Varengold Bank AG
with its registered office in Hamburg
Securities identification number (WKN) 547 930
ISIN DE0005479307
We herewith invite our company's shareholders to the
Ordinary General Meeting
on
Wednesday 24 August 2022 at 10.00 a.m.
(admission at 9:30 a.m.)
at
Haus der Wirtschaft Service GmbH
Kapstadtring 10
22297 Hamburg.
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The Supervisory Board and Board of Managing Directors propose to formally approve the actions of the members of the Board of Managing Directors in office during the 2021 financial year.
3. Resolution on the formal approval of the actions of the members of the Supervisory Board for financial year 2021
The Board of Managing Directors and the Supervisory Board propose to formally approve the actions of the members of the Supervisory Board in office during the 2021 financial year.
4. Election of the auditor for the 2022 financial year
The Supervisory Board proposes to elect PricewaterhouseCoopers GmbH Wirtschaftsprüfungsgesellschaft, Hamburg, as auditor for the 2022 financial year and as auditor for the review of interim reports, if any, until the next Ordinary General Meeting.
PricewaterhouseCoopers GmbH Wirtschaftsprüfungsgesellschaft has declared to the Supervisory Board that there are no professional, financial, personal or other relationships in place between itself, its executive bodies and staff responsible for the audit on the one hand, and Varengold Bank AG and its executive bodies on the other hand, that could cast doubt on its independence.
5. Resolution on the increase in share capital against cash contributions excluding subscription
rights
The Board of Managing Directors and Supervisory Board propose the following resolutions:
"a) The company's share capital, currently EUR 10,043,015.00, divided into 10,043,015 no-par value bearer shares (ordinary shares), is to be increased against cash contributions by up to EUR 1,004,301.00 to up to EUR 11,047,316.00 by issuing up to 1,004,301 new no-par value bearer shares (ordinary shares), each with a proportionate interest in the share capital of EUR 1.00. The issuing amount within the meaning of Section
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185 (1) sentence 3 number 2 of AktG (German Stock Corporation Act) is EUR 1.00 per ordinary share ("lowest issuing amount").
Report of the Board of Managing Directors pursuant to Section 186 (4) sentence 2 AktG on agenda item 5 on the exclusion of subscription rights
Pursuant to Section 186 (4) sentence 2 AktG, the Board of Managing Directors has produced a written report on the reason for the exclusion of the subscription right. The material content of this report by the Board of Managing Directors is set out below. At the General Meeting, the Board of Managing Directors will also provide further details justifying the proposed resolution to increase capital.
"Shareholders' subscription rights may only be excluded, where permitted to do so, if the conditions set out in Section 186 (3) sentence 4 AktG have been met. This will be the case in particular if the capital increase
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made against cash contributions does not exceed a total volume of 10% of the share capital and the issuing amount for the new shares does not fall below the level of materiality for the stock market price. This opportunity to exclude subscription rights should enable the Board of Managing Directors and Supervisory Board to use favourable conditions on the capital markets in the short term to strengthen the company's equity capital. In detail:
(1) No simplified exclusion of subscription rights connected in series in the short term
The most recent utilisation of the so-called simplified exclusion of subscription rights in accordance with Section 186 (3) sentence 4 AktG was more than 12 months ago.
(2) Capital limit
The proposed cash capital increase falls within the limit stipulated by law, and the permitted increase amount (10% corresponding to 1,004,301 shares) is not exceeded.
(3) Issuing amount of young shares
In order to achieve the best possible placement with low borrowing costs and a high level of transaction security, the issuing amount may only be a maximum of 3% below the average stock market price for the closing prices of shares of the company on the Frankfurt Stock Exchange (Xetra trading) during the last five stock market days prior to the Board of Managing Directors setting the issuing amount as well as the closing price for shares of the company on the Frankfurt Stock Exchange (Xetra trading) on the date the Board of Managing Directors sets the issuing amount, and may therefore not be significantly lower. At the same time, the issuing amount should be at least EUR 10.00 per ordinary share ("minimum amount"). On 11July 2022 (closing price) Varengold Bank AG was quoted at EUR 3.58 (Xetra).
Having carefully considered the circumstances set out above, and taking into account as well any dilution effect that is generally to the detriment of the other shareholders, the Board of Managing Directors and Supervisory Board believe the exclusion of shareholders' subscription rights in accordance with Section 186
The company's shares are listed on the Basic Board of the German Stock Exchange and are traded on Xetra, among other platforms. Shareholders not participating in the capital increase but with an interest in acquiring shares therefore have the ability to buy shares on the stock exchange in order to maintain their relative shareholding in the company, or the option to sell, for example in the event that shareholders wish to reduce their shareholding in the company in whole or in part due to any change in the shareholder structure. The shareholders' interests in the assets and voting interests have therefore been safeguarded.
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This consideration by the Board of Managing Directors and Supervisory Board also included in particular the fact there are no alternatives that can be realised in the short term.
(5) Specific objective justification
In the event among other things that, as part of the intended sale to strategic and/or institutional investors, this involves a package sale or even a dilution of shareholdings that grant influence, the Board of Managing Directors will also report on the specific objective justification for the exclusion of subscription rights.
(5.1) Conditions on the capital market
At present, the stock market environment can be described as extremely difficult, so that the Board of Managing Directors considers the prospect of placement of a regular cash capital increase to be low. However, extensive contact with investors has shown that institutional and strategic investors in particular are willing to consider shares in Varengold Bank AG at an issuing amount that in some cases may be higher than the stock market price. By doing away with resolution of the subscription right, which is time- consuming and costly, it may be possible to take advantage of this opportunity in the near term.
(5.2) Company's interest in optimum proceeds
The Board of Managing Directors wants to strengthen Varengold Bank's own capital base, with a view to permanently raising the legal requirement pursuant to point (d) of Article 92 (1) CRR with regard to compliance with the so-called leverage ratio to a level above the threshold. To achieve this, and with the approval of the Supervisory Board, the implementation of a cash capital increase excluding the subscription rights of existing shareholders will be proposed to the Ordinary General Meeting on 24 August 2022. In this effort, the exclusion of subscription rights is the appropriate and necessary means of taking advantage of the difficult conditions on the capital market, as described above, and injecting an appropriate amount of new equity into the company in the short term. In particular, this approach would benefit the company by allowing a subscription price well above the stock exchange price to be set, which would not be feasible through a cash capital increase without the exclusion of subscription rights. Another important factor for the Board of Managing Directors in this context is that strategic investors open up the possibility of tapping into new markets, customers and additional business opportunities for the company.
(5.3) Additional point-by-point consideration
Swift implementation of the capital increase supports the purpose of the company in an effective way, in particular
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Varengold Bank AG published this content on 15 July 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 15 July 2022 13:03:02 UTC.