(Amendment of the ceiling and expiry date set out in the authorisation given to the Board of Directors at the Extraordinary Meeting of 14 May 2003 to issue shares for subscription by participants in the Corporate Savings Plan, without pre-emptive subscription rights for existing shareholders)
The Extraordinary Meeting:
- having noted that in its sixteenth resolution the Extraordinary Meeting of 14 May 2003 granted the Board of Directors a five-year authorisation, in accordance with paragraph 4 of section L. 225-129 III and section L. 225-138 of the Commercial Code and section L. 443-5 of the Labour Code, to issue shares for subscription by participants in the BNP Paribas Group Corporate Savings Plan, on one or several occasions, at the Board's discretion, provided that the aggregate par value of the shares issued does not exceed € 60,000,000;
- having reviewed the provisions of paragraph 1 of section L. 225-129 VII of the Commercial Code,
- having reviewed the report of the Board of Directors and the Auditors' special report;
- that the above-mentioned authorisation shall now be valid for no more than 26 months from the date of this Meeting,
- to reduce the ceiling under the authorisation to € 20,000,000 as from the date of this Meeting.
The Extraordinary Meeting notes that all of the other terms and conditions of the authorisation given to the Board of Directors in the sixteenth resolution of the Extraordinary Meeting of 14 May 2003 to issue shares for subscription by participants in the Corporate Savings Plan, without pre-emptive subscription rights for existing shareholders, remain unchanged.
Presentation of the resolution
In the fifteenth resolution the Board of Directors is seeking authorisation to amend the ceiling and expiry date set out in the authorisation to issue shares for subscription by participants in the Corporate Savings Plan granted by the Extraordinary General Meeting of May 14th 2003.
The 1987 privatisation of Paribas and the 1993 privatisation of BNP created an opportunity for many employees to become shareholders of their bank, offering them a powerful incentive to perform well and aligning their interests on those of all other shareholders. The employees invested mainly through the Corporate Savings Plan which is open to all members of staff. Payments into the plan are inaccessible for a period of 5 years. There is only one such subscription period per year in accordance with the conditions set down by law.
Employees held 3.83% of the Bank’s capital at 31 December 2003 through the Corporate Savings Plan, compared with 3.54% a year earlier. In 2003, 6,673,360 shares were issued under the plan, representing 0.74% of the capital. However, after taking into account shares bought back from employees at the end of the five year holding period, the net increase in the proportion of capital held by employees was less than 0.30%.
None of these shares entitle their holders to an increased dividend or double voting rights, BNP Paribas having adopted the principle of "1 share = 1 vote = 1 dividend". Each of the funds under the Corporate Savings Plan is managed by a Supervisory Board, made up of elected employee representatives and therefore independent from the BNP Paribas Group’s management. The Chairman of each of these Supervisory Boards attends each BNP Paribas General Meeting, where he votes autonomously and personally; they do not ever grant proxies to the Chairman of BNP Paribas.
With the aim of bolstering employee involvement in the Bank's development and the value creation process, the Extraordinary Meeting held in 2003 gave the Board of Directors a five-year authorisation to increase the capital by a maximum par value of € 60 million through the issuance of shares to participants in the Corporate Savings Plan of the Bank and certain subsidiaries. In order to harmonise the term of this authorisation with the ones of the authorisations to issue shares and share equivalents set out above, the Board of Directors is inviting shareholders to reduce the term of the authorisation given last year to twenty-six months, instead of the four years left to run. In addition to reducing the term of this authorisation, shareholders are also invited to reduce the ceiling applicable to shares issued to a par value of €20 million, corresponding to 10 million shares, representing 1.1% of the current capital or 0.55% per year. As stated above in the summary of the sixth resolution, the Bank intends to carry out a share buyback programme in 2004 to neutralise the impact of these employee share issues.