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NOTE 11. EQUITY

Our Management Board has the power to issue ordinary shares and (financing) preference shares insofar as the Management Board has been authorized to do so by the General Meeting of Shareholders. The Management Board requires the approval of the Supervisory Board for such an issue. The authorization by the General Meeting of Shareholders can only be granted for a certain period. In the case that the General Meeting of Shareholders has not authorized the Management Board to issue shares, the General Meeting of Shareholders shall have the power to issue shares.

Common shares, preferred and financing preferred shares

The authorized capital of the Company amounts to 110,000,000 common shares of €0.04 par value, 118,000 preferred shares of €40 par value and 8,000 financing preferred shares of €40 par value.

As at December 31, 2016, 63,797,394 ordinary shares with a nominal value of €0.04 each were issued and fully paid up, of which 3,981,551 ordinary shares are held by us in treasury. All shares have one vote per €0.04 par value. Treasury shares held by the Company cannot be voted on. Of our 59,815,843 outstanding common shares at December 31, 2016, 3,039 are registered with us in the Netherlands, 59,409,659 are registered with our transfer agent in the Netherlands, ABN AMRO Bank NV, and 403,145 are registered with our transfer agent in the United States, Citibank, NA, New York.

Financing preferred shares are designed to allow ASMI to finance equity with an instrument paying a preferred dividend, linked to EURIBOR loans and government loans, without the dilutive effects of issuing additional common shares.

Preferred and financing preferred shares are issued in registered form only and are subject to transfer restrictions. Essentially, a preferred or financing preferred shareholder must obtain the approval of the Company's Supervisory Board to transfer shares. If approval is denied, the Supervisory Board will provide a list of acceptable prospective buyers who are willing to purchase the shares at a cash price to be fixed by consent of the Supervisory Board and seller within two months after the approval is denied. If the transfer is approved, the shareholder must complete the transfer within three months, at which time the approval expires.

Preferred shares are entitled to a cumulative preferred dividend based on the amount paid up on such shares. Financing preferred shares are entitled to a cumulative dividend based on the par value and share premium paid on such shares.

As per December 31, 2016 no preference shares are issued.

RETAINED EARNINGS

Distributions to common shareholders are limited to the extent the total amount of shareholders’ equity exceeds the amounts of nominal paid-in share capital (exclusive any share premium) and any reserves to be formed pursuant to law or the Company’s articles of association. The amounts are derived from the Statutory financial statements of ASMI.

ASMI aims to pay a sustainable annual dividend. The Supervisory Board, upon proposal of the Management Board, will annually assess the amount of dividend that will be proposed to the Annual General Meeting of Shareholders. The decision that a dividend be proposed to the Annual General Meeting of Shareholders will be subject to the availability of distributable profits as well as retained earnings and may be affected by our potential future funding requirements. Accordingly, dividend payments may fluctuate and could decline or be omitted in any year.

In 2016, we paid a dividend of €0.70 per common share. We will propose to the forthcoming 2017 Annual General Meeting of Shareholders to declare a dividend of €0.70 per share.

Results on dilution of investments in associates are accounted for directly in equity. For 2016 and 2015, these dilution results were €9,336 and €5,535 respectively.

TREASURY SHARES

On October 26, 2016, ASMI announced a new €50 million share buyback program to be executed within the 2016-2017 time frame. The program started on December 13, 2016. On December 31, 2016, 12.9% of the program was effectuated.

On October 28, 2015, ASMI announced a share buyback program to purchase up to an amount of €100 million of its own shares within the 2015-2016 time frame. The program started on November 26, 2015, and was completed on November 11, 2016. Under the 2015-2016 share buyback program, we repurchased 2,772,729 shares at an average price of €35.98.

On October 29, 2014, ASMI announced a share buyback program to purchase up to an amount of €100 million of its own shares within the 2014-2015 time frame. The program started on November 24, 2014, and was completed on May 20, 2015. Under the 2014-2015 share buyback program, we repurchased 2,594,420 shares at an average price of €38.55.

ASMI intends to use part of the shares for commitments under employee share-based compensation schemes.

The share buyback programs were executed by intermediaries through on-exchange purchases or through off-exchange trades. ASMI updated the markets on the progress of the share buyback programs on a weekly basis.

The repurchase programs are part of ASMI's commitment to use excess cash for the benefit of its shareholders.

OTHER RESERVES

The changes in the amount of other reserves are as follows:

Proportionate share in other comprehensive income investments in associates 1Translation reserveTotal other reserves
Balance January 1, 2015(1,699)56,46954,770
Proportionate share in other comprehensive income investments in associates567567
Foreign currency translation effect on translation of foreign operations136,744136,744
Balance December 31, 2015(1,132)193,213192,081
Proportionate share other comprehensive income investments in associates(1,344)(1,344)
Foreign currency translation effect on translation of foreign operations40,73140,731
Balance December 31, 2016(2,476)233,944231,468
  1. Proportionate share in other comprehensive income investments in associates and translation reserve, items may be subsequently reclassified to profit or loss.

PURCHASES OF EQUITY SECURITIES BY THE ISSUERS AND AFFILIATED PURCHASERS

On May 25, 2016, the Annual General Meeting of Shareholders authorized the Company, for an 18-month period, to be calculated from the date of the Annual General Meeting, to repurchase its own shares up to 10% of the issued capital, at a price at least equal to the shares’ nominal value and at most a price equal to 110% of the shares' average closing price according to the listing on the Euronext Amsterdam stock exchange during the five trading days preceding the purchase date.

On October 29, 2014, ASMI announced a share buyback program to purchase up to an amount of €100 million of its own shares within the 2014-2015 time frame.

The following tables provide a summary of shares repurchased by ASMI under this program:

PeriodTotal number of shares purchasedAverage price paid per share (EUR)Cumulative number of shares purchasedMaximum value of shares that may yet be purchased under the program (EUR)
Share buyback program 2014-2015:
November, 2014555,671€33.18555,67181,563
December, 2014397,881€33.86953,55268,092
January, 2015259,302€35.121,212,85458,986
February, 2015200,710€36.971,413,56451,586
March, 2015277,253€42.761,690,81739,731
April, 2015629,831€44.362,320,64811,815
May, 2015273,772€43.172,594,420
Total2,594,420€38.55

On October 28, 2015, ASMI announced a share buyback program to purchase up to an amount of €100 million of its own shares within the 2015-2016 time frame.

The following tables provide a summary of shares repurchased by ASMI under this program:

PeriodTotal number of shares purchasedAverage price paid per share (EUR)Cumulative number of shares purchasedMaximum value of shares that may yet be purchased under the program (EUR)
Share buyback program 2015-2016:
November, 201523,788€37.5923,78899,105
December, 2015228,191€36.16251,97990,853
January, 2016209,682€34.28461,66183,667
February, 2016407,902€36.35869,56368,839
March, 2016273,296€38.701,142,85958,263
April, 2016272,475€37.931,415,33447,928
May, 2016154,101€34.891,569,43542,551
June, 2016226,996€34.731,796,43134,668
July, 2016273,058€35.812,069,48924,889
August, 2016312,157€33.592,381,64614,404
September, 2016242,751€35.102,624,3975,883
October, 2016106,095€37.362,730,4921,920
November, 201642,237€38.932,772,729
Total2,772,729€35.98

On October 26, 2016, ASMI announced a share buyback program, to purchase up to an amount of €50 million of its own shares within the 2016-2017 time frame.

The following tables provide a summary of shares repurchased by ASMI under this program:

PeriodTotal number of shares purchasedAverage price paid per share (EUR)Cumulative number of shares purchasedMaximum value of shares that may yet be purchased under the program (EUR)
Share buyback program 2016-2017:
December, 2016153,022€42.31153,02243,526
Total153,022€42.31