Capital Band (Capital Authorization). Article 5 of our articles of association provides for a general capital band ranging from 83,184,490.00 Swiss francs (lower limit) to 102,129,396.70 Swiss francs (upper limit), which may be used by our board of directors to issue new Transocean shares for (a) general purposes or (b) incentive plans.
General Authorization. Article 5 of our articles of association provides for a capital band that authorizes our board of directors to issue up to 159,449,067 new fully paid-in Transocean shares for general corporate purposes at any time until May 11, 2024, and thereby increase the stated share capital from time to time. A capital increase may further be effected within the range of the capital band by way of an increase of the par value of the Transocean shares (but in any event at a maximum of 15,944,906.70 Swiss francs). Consistent with applicable Swiss law, Article 5 of our articles of association does not currently reflect the previous issuance of 11,870,376 Transocean shares from our general capital band to one of our wholly owned subsidiaries, which shares were delivered as consideration for the purchase of the outstanding equity interests of Liquila Ventures. For further information, see “—Summary of the Transaction” above. Accordingly, the remaining authority to issue Transocean shares from our general capital band is limited to a maximum of 147,578,691 shares.
Our board of directors determines the time of the issuance, the issue price, the manner in which the new Transocean shares have to be paid in, the date from which the new Transocean shares carry the right to dividends and, subject to the provisions of our articles of association, the conditions for the exercise of the preemptive rights with respect to the issuance and the allotment of preemptive rights that are not exercised. The board of directors may allow preemptive rights that are not exercised to expire, or it may place such rights or Transocean shares, the preemptive rights in respect of which have not been exercised, at market conditions or use them otherwise in our interest. For further information on preemptive rights with respect to our capital authorization for general purposes, see “—Preemptive Rights and Advance Subscription Rights” below.
An increase of the share capital by means of an offering underwritten by a financial institution, a syndicate of financial institutions or another third party or third parties, followed by an offer to the then-existing shareholders of Transocean is permissible.
Specific Authorization. For incentive compensation plans, our board of directors is authorized to issue, directly or indirectly, up to 30,000,000 new fully paid-in Transocean shares under our incentive compensation plans to members of our board of directors, members of our executive management team, officers, employees, contractors, consultants or other persons providing services to us or our subsidiaries at any time until May 11, 2028, and thereby increase the stated share capital from time to time. For such purposes, the preemptive rights of existing shareholders are excluded. Our board of directors determines the time of the issuance, the issue price (which may be lower than the current market price), the manner in which the new shares have to be paid and the date from which the new shares carry the right to dividends.
The capital authorization expires (a) for general purposes on May 11, 2024, (b) for incentive plans on May 11, 2028, (c) upon an earlier complete use of the maximum number of authorized Transocean shares, or (d) upon an earlier expiration of the authorization following an ordinary capital increase, an ordinary capital reduction or a change of the currency of the share capital resolved by the general meeting of shareholders.
The Transocean shares will be subject to the limitations for registration in the share register pursuant to Articles 7 and 9 of our articles of association.
Conditional Share Capital. Article 6 of our articles of association provides for a conditional share capital that allows the issuance by Transocean of up to 142,362,675 Transocean shares and thus an increase of the stated share capital by a maximum amount of 14,236,267.50 Swiss francs. Consistent with applicable Swiss law, Article 6 of our articles of association does not currently reflect the previous issuance of 582 Transocean shares out of conditional share capital following and in connection with the exchange of certain of our exchangeable bonds. Accordingly, the remaining authority to issue Transocean shares out of conditional share capital is limited to a maximum of 142,362,093 shares. These shares may be issued through:
| ● | the exercise of conversion, exchange, option, warrant or similar rights for the subscription of shares granted to third parties or shareholders in connection with bonds, options, warrants or other securities newly or already issued in national or international capital markets or new or already existing contractual obligations by or of us or any of our group companies or any of our respective predecessors; or |