2   Capital structure

2.1     Capital on the cut-off date

As at 31 December, Allreal Holding AG had the following capital structure:

2.2     Authorised and conditional capital in particular

Authorised capital

The Board of Directors is authorised by the annual general meeting to increase the share capital – excluding the subscription rights of shareholders as applicable – until 26 March 2012 to acquire businesses, business units, participating interests or real estate through an exchange of shares, for financing or refinancing the acquisition of businesses, business units, participating interests or investment projects, or for the purpose of an international placement of shares worth up to CHF 200.0 million by issuing up to 4 000 000 registered shares each with a par value of CHF 50 (authorised capital). In May 2010, the authorised capital was reduced by CHF 113.9 million from CHF 200.0 million to CHF 86.1 million (as at 31 December 2011) owing to the rights issue.

Conditional capital

For the purpose of issuing convertible bonds, warrant bonds or other financial instruments, the annual general meeting of 31 March 2006 created – excluding the subscription rights of shareholders – conditional capital of up to CHF 125.0 million through the issue of up to 2 500 000 registered shares with a par value of CHF 50 each. Bearers of the convertible and/or warrant bonds are entitled to subscribe to the new shares. This conditional capital decreased by CHF 0.2 million to CHF 124.8 million (as at 31 December 2011), following the conversion of convertible bonds into shares.

Further, Allreal Holding AG has conditional capital of CHF 10.0 million (200 000 registered shares at a par value of CHF 50 each) at its disposal for the purposes of issuing options to the members of the Board of Directors and management. This conditional capital had not been drawn on as at the balance sheet date.

2.3     Changes in capital

In the years 2009 to 2011, the capital structure changed as follows as the result of a rights issue in May 2010 and the conversion of convertible bonds into shares in March 2011:

2.4     Shares and participation certificates

The share capital is divided into 13 664 271 fully paid-in registered shares with a par value of CHF 50. All outstanding shares are unitary shares; there are no preferred or voting right shares.

The registered shares are issued in the form of book-entry securities.

All shares are dividend-bearing. Exercise of the membership rights accorded to the shareholder is conditional on an entry in the share register. Each registered share carries one vote at the general meeting.

The voting rights attaching to treasury shares held by the company are suspended, and no dividends are paid on these shares.

The company has no participation certificate capital.

2.5     Dividend-right certificates

Allreal has not issued any dividend-right certificates.

2.6     Limitations on transferability and nominee registrations

Every shareholder is entitled to be entered in the share register. The Board of Directors may refuse entry in the share register if the number of registered shares held by the acquirer or by a group of shareholders acting jointly directly or indirectly exceeds 5% of the share capital.

Subject to the 5% clause referred to above, nominee registrations are admissible without any limitations on voting rights.

2.7     Convertible bonds and options

The company has a 2.125% CHF 199.95 million convertible bond outstanding (term from 9 October 2009 to 9 October 2014).

In March 2011, 360 registered shares with a par value of CHF 50 each were created from conditional capital through the conversion of convertible bonds. For this reason, the original principal amount of the convertible bond was reduced by CHF 0.05 million from CHF 200.0 million to CHF 199.95 million.

The convertible bond is listed on SIX Swiss Exchange (security number 10 553 767, ISIN CH0105537671, symbol ALL09). The coupon is payable annually on 9 October. The bond will be redeemed at par by no later than 9 October 2014. Until 19 September 2014, each bearer bond at CHF 5 000 par can be converted into 36.03604 registered shares of Allreal Holding AG, which corresponds to a conversion price of CHF 138.75. If all conversion rights are exercised, 1 441 081 new shares at CHF 50 par would be created from conditional capital, corresponding to share capital of up to CHF 72.1 million. The bond may be redeemed early, and the bond terms customary for such capital market instruments shall apply. Specifically, this includes an option for premature redemption either at any time at par, including accrued interest, provided more than 85% of the original principal amount has been converted and/or redeemed, or if the registered share of Allreal Holding AG closes at no lower then CHF 180.40 on 20 trading days within a period of 30 consecutive trading days. As at 31 December 2011, the conditions for premature redemption had not been met.

The company had issued neither warrant bonds nor option plans on Allreal registered shares as at the balance sheet date.