PART II COMPANY OWNER
AMENDMENTS TO THE ARTICLES OF ASSOCIATION AND INCREASE OR REDUCTION OF SHARE CAPITAL
Subsection 1
Amendments to the articles of association Article 329
(Resolution of the general meeting)
(1) Any changes to the Articles of Association shall require the passing of a special resolution by resolution passed by the general meeting. The general meeting may transfer the power to amend the articles of association to the supervisory board or to the board of directors for matters concerning solely bringing the wording of the articles of association into line with duly adopted decisions.
(2) The general meeting's resolutions shall require at least a three quarters majority vote of the share capital represented at the meeting. The articles of association may require a different majority shareholding but not less than a majority of the share capital represented in the voting if at least one half of the share capital is represented in the voting. This shall not apply to a change in the company's activity and cases for which a higher majority of the represented capital is required by the law. The articles of association may also set other requirements.
(3) The validity of a general meeting's resolution referred to in the preceding paragraph, under which the current ratio between several classes of shares is changed to the detriment of a particular class of shares, shall be subject to the consent of the Shareholders of that particular class. The Shareholders concerned shall adopt an extraordinary resolution to grant their consent. The provisions of the preceding paragraph shall apply to the adoption of this resolution.
Article 330
(Transfer of at least 25% of the company's assets)
(1) Contracts and other business transactions under which a limited liability company undertakes to transfer at least 25% its assets, which does not represent a transfer in accordance with the provisions of the legal form transformation act, shall be subject to a resolution of the general meeting passed with a majority vote specified in paragraph (2) of Article 329 of this Act. This restriction shall have no legal effect against third parties.
(2) The contract shall be made available for inspection by the Shareholders at the registered office of the company at least one month before the general meeting that will decide on consent on the transfer of the company's assets. Each Shareholder shall be given a free copy of the contract upon request on the following business day at the latest.
(3) The contract by which the company undertakes to transfer at least 25% of its assets shall be submitted at the general meeting. At the beginning of the discussion at the general meeting, the company's management shall give an oral explanation of the contents of the contract. The contract shall be attached as a supplement to the minutes.
(4) If the company is dissolved as a result of the transfer of at least 25% of its assets, the original contract or a notarised copy thereof shall be attached to the proposal for its dissolution.
Article 331
(Shareholders' consent)
(1) The validity of the resolution imposing additional obligations on Shareholders in accordance with this Act and the articles of association shall require the consent of all Shareholders concerned.
(2) The provision of the preceding paragraph shall also apply to a resolution which requires the company's consent for the transfer of registered shares or Interim Certificates.
Article 332
(Registration of the amendment to the articles of association)
(1) The management shall notify an amendment to the articles of association for entry in the register. The notification shall be accompanied by a copy consolidated text of the articles of association, to which a notarial certificate verifying that the amended provisions in the articles of association conform with the resolution to amendment the articles of association. If the amendment to the articles of association requires the permission of a state authority, such permission shall also be attached to the notification.
(2) If the amendment does not relate to the data specified in Article 201 of this Act, it shall be sufficient to refer, at the time of registration, to the documents submitted to the registration authority. If the amendment concerns provisions whose content should be published, the content of the amendment shall also be published.
(3) An amendment to the articles of association shall come into force on the day on which it is entered in the register.
Subsection 2
Measures for increasing the share capital Section 1
Increase of the share capital through contributions Article 333
(Terms and conditions)
(1) A decision to increase share capital through contributions shall be taken with the affirmative vote of at least a three quarters majority of the share capital represented at the meeting, unless the articles of association stipulate a different majority shareholding;
however, not less than a majority of the share capital represented at the meeting. The articles of association may only stipulate a larger majority shareholding and additional requirements for the issue of non-voting preference shares.
(2) The subscribed capital may only be increased through the issue of new shares. In companies with no-par value shares, the total number of shares shall be increased in the same proportion as share capital.
(3) If there is more than one class of shares, the approval of each share class shall be required for a general meeting's resolution to be valid. Shareholders of each share class shall pass an extraordinary resolution giving their approval in accordance with the provisions of paragraph (1) of this Article.
(4) If the Issue Price of the shares is higher than the minimum Issue Price, the resolution to increase share capital shall establish the minimum amount to be paid on the purchase of shares.
(5) No increase of the share capital shall be carried out until the existing contributions have been paid up in full unless only an insignificant sum remains unpaid.
Article 334
(Increase of the share capital through non-cash contributions)
(1) In the case of increase of the share capital by non-cash contributions, the resolution to increase the share capital shall determine the object of contribution, the person from whom the company shall acquire the object of contribution, the number of shares and, in the case of par-value shares, also the par value of shares to be provided for a non-cash contribution.
A resolution to this effect may only be adopted if the acceptance of a non-cash contribution and the details referred to in the first sentence of this Article are published in accordance with paragraph (1) of Article 298 of this Act
(2) Unless otherwise provided by Article 345a of this Act, the increase of the share capital by non-cash contributions shall be examined by one or more auditors, subject to the application, mutatis mutandis, of the provisions of Articles 194 and 195 to 197 of this Act.
(3) The registration authority may refuse to enter the increase of the share capital in the register if the amount of non-cash contribution is significantly lower than the minimum Issue Price of the shares that should be provided for such non-cash contribution.
Article 334a
(Increase of the share capital by non-cash contributions without audit)
(1) The increase of the share capital by non-cash contributions which does not require an audit shall be subject, mutatis mutandis, to the provisions of paragraphs (1) to (4) and the first to third sentences of paragraph (5) of Article 194a of this Act. In this context:
1. The term "formation auditor" or "formation auditors" shall be replaced by the term
"auditor" or "auditors";
2. The term "formation" shall be replaced by the term "increase of the share capital by non-cash contributions";
3. The term "articles of association" shall be replaced by the term "resolution on the increase of initial capital";
4. The term "formation audit" shall be replaced by the term "audit";
5. The average price weighted average shall be determined for at least a six-month period ending two months before the date of adoption of the resolution on the increase of the share capital.
(2) The agenda of the general meeting shall include a notice that the share capital need not be audited. The management and supervisory bodies shall indicate proposals for resolutions in the agenda of the general meeting; in addition to the information specified in paragraph (1) of the preceding paragraph, the decision on the increase of the share capital shall also determine that the share capital increase need not be audited.
(3) The acquisition of the subject of non-cash contribution shall be valid if it is delivered to the company before the fifth business day from the date of the resolution to increase the share capital.
(4) When in the case referred to in paragraph (1) of this Article, in connection with the second or third indents of paragraph (1) of Article 194a of this Act, one or more auditors fail to perform an audit of the share capital increase by non-cash contributions notwithstanding the occurrence of new circumstances referred to in paragraph (5) of Article 194a of this Act, the court shall appoint an auditor to review the share capital increase by non-cash contributions on the proposal of Shareholders whose total holdings account for at least one twentieth of the share capital on the date of the resolution on the increase of the share capital. The Shareholders referred to in the preceding paragraph may file their proposal before the delivery of the subject of non-cash contribution. The Shareholders shall place their shares in the custody of the Central Clearing and Depositary Corporation unless the shares have already been deposited or issued in dematerialised form and may not freely dispose of the shares before filing a proposal. If the share capital increase by non-cash contribution is reviewed by an auditor, the statement specified in paragraph (4) of Article 194a shall not be submitted to the registration authority and published.
Article 335
(Notification of the decision for entry in the register)
(1) The management and the president of the supervisory board shall notify the resolution on the share capital increase for registration. The notification shall be accompanied by the following:
– a report on the audit of non-cash contributions if the share capital increase has been audited by one or more auditors;
– in the case referred to in paragraph (1) of the preceding paragraph, in connection with the first indent of paragraph (1) of Article 194a of this Act, a certificate of price-weighted average specified in paragraph (2) of Article 194a of this Act;
(2) The notification shall indicate the unpaid contributions to the existing share capital and the reason for non-payment.
Article 336
(Subscription for new shares)
(1) New shares shall be subscribed by lodging a written statement (hereinafter:
Subscription Share Certificate) evidencing their number and, in par value shares, also their face value. If several share classes are issued the share class shall also be shown. The Subscription Share Certificate shall be issued in duplicate. It shall contain the following information:
– the date on which the resolution on the increase of the share capital is passed;
– the Issue Price of shares, the amount of payments and any additional obligations;
– the information from paragraph (1) of Article 334 of this Act and, where more than one share class is issued, the Corresponding Amount of the share capital; and
– the point in time when the subscription becomes non-binding unless the increase in the share capital had been registered by that time.
(2) The Subscription Share Certificates lacking the full information specified in the preceding paragraph shall be void.
(3) A restriction not indicated in the Subscription Share Certificate shall be void against the company.
Article 337
(Pre-emption right to new shares)
(1) The existing Shareholders shall have a pre-emption right to subscribe for new shares in proportion to their shareholdings. This right may be exercised within no less than 14 days.
(2) The management shall publicly announce the Issue Price of the new shares and the time limit referred to in the preceding paragraph.
(3) The pre-emption right may only be excluded in part or in full by a resolution on the increase of the share capital. In this case, in addition to legal or statutory requirements of a capital increase, the resolution shall require at least a three-quarter majority of the share capital represented at the meeting. The articles of association may also lay down a larger majority shareholding and other requirements.
(4) A resolution fully or partially excluding the pre-emption right may only be adopted if the exclusion is publicly announced in accordance with paragraph (1) of Article 298 of this Act.
The management shall submit a written report to the general meeting on the well-founded reasons for a full or partial exclusion of the pre-emption right. The report shall also justify the proposed Issue Price of shares.
(5) If the new shares are accepted by a financial organisation which undertakes to offer them for sale to Shareholders, it shall not be considered as an exclusion of the pre-emption right. The management shall publicly announce the financial organisation's offer in the company's newsletter or electronic media, including the amount of payment for the shares and the time limit for acceptance of the bid. The same shall apply if the shares are acquired by some other person with the obligation to offer them to Shareholders.
Article 338
(Securing of options and other entitlements to subscribe for new shares)
(1) Options and other entitlements to subscribe for new shares shall take account of the provisions of this Act concerning the pre-emption right of Shareholders to new shares.
(2) If options or other entitlements to subscribe for new shares are provided before adopting an appropriate resolution to increase the share capital, the provision of such entitlements shall have no legal effect against the company.
Article 339
(Notification and registration of an increase of the share capital)
(1) The management and the president of the supervisory board shall notify the implementation of the share capital increase for registration.
(2) The provisions of paragraph (1) of Article 199 of this Act shall apply, mutatis mutandis, to the notification for registration.
(3) The notification shall be accompanied by:
- duplicates of Subscription Share Certificates and a list of subscribers signed by the management, indicating the shares of and payments made by each subscriber;
- if capital is increased by non-cash contributions:
1. Contracts as the basis for the data referred to in Article 334 of this Act or contracts made for the implementation of such data;
2. In the cases referred to in paragraph (1) of Article 334 in connection with paragraph (1) of Article 194a of this Act, a statement by the management and supervisory bodies that the Shareholders from paragraph (4) of Article 334a of this Act did not propose the appointment of the auditor;
- a statement of costs which will be incurred by the company with the issue of new shares;
and
- approval by a state authority where this is necessary for an increase of the share capital.
(4) The originals or certified copies of the submitted documents shall be kept by the registration authority.
Article 340
(Effective date of share capital increase)
The increase of the share capital shall become effective on the date of registration.
Article 341 (Publication)
In addition to the concept of the increase in share capital, the announcement of the share capital increase shall also include the issue price of shares, the data required for increasing the share capital through non-cash contributions, and a report on the audit of non-cash contributions if necessary. In the publication of this information, the reference to the documents submitted to the registration authority shall suffice.
Article 342
(Prohibition to issue shares and Interim Certificates)
Prior to the registration of the share capital increase, no rights to new shareholdings may be transferred and no new shares and/or Interim Certificates may be issued. The shares and Interim Certificates issued before such registration shall be void. Liability for the losses suffered by holders of shares and Interim Certificates issued in this way shall be assumed by the issuers as joint and several debtors.
Section 2
Conditional increase of share capital Article 343
(Conditions)
(1) The general meeting may decide to conditionally increase the share capital only for the following reasons:
– the exercise of the rights of holders of convertible bonds to exchange such bonds for shares or to exercise their pre-emptive rights to purchase new shares;
– preparation for the merger of several companies or payment of a consideration to shareholders in connection with changes in the legal form of companies if, according to this Act, consideration may be provided in shares; and
– the exercise of the rights by a company's employees to receive new shares in exchange for their receivables from the participation in profits granted to them by the company, and the provision of entitlements to share purchase options granted by the company to the members of the management and supervisory bodies, employees or an affiliated company.
(2) The minimum issue price of shares issued in the procedure of the conditional share capital increase shall not exceed one half of the share capital existing during the deliberation on a conditional share capital increase.
(3) Resolutions of the general meeting passed in violation of the preceding paragraphs shall be void.
(4) The provisions of this Act concerning the exercise of the pre-emptive right to purchase new shares shall also apply, mutatis mutandis, to convertible bonds.
Article 344 (Validity of resolutions)
(1) The validity of the resolutions on a conditional increase in the share capital shall require the majority of at least three quarters of the share capital represented at the general meeting. A larger majority shareholding and other requirements as well as the approval referred to in Article 333 of this Act may be stipulated by the articles of association.
(2) The resolution shall also determine:
– the purpose of the share capital increase;
– the entitled persons; and
– the issue price or the criteria according to which this issue price is to be calculated.
Article 345
(Conditional increase of share capital by non-cash contributions)
(1) The resolution on a conditional share capital increase shall define the subject of non-cash contributions, the persons from whom the company obtains the subject of non-non-cash contributions, the number of shares, and, for nominal value shares, the nominal amount of shares provided for non-cash contributions. The resolution shall only be passed if the acquisition of a non-cash contribution has been published in accordance with Article 296 and paragraph (3) of Article 298 of this Act.
(2) The employees' receivables from the participation in profits granted to them by the company and the delivery of convertible bonds in exchange for shares shall not be deemed non-cash contributions.
(3) Unless otherwise provided by Article 345a of this Act, the increase in the share capital by non-cash contributions shall be examined by one or more auditors, subject to the application, mutatis mutandis, of the provisions of Articles 194 and 195 to 197 of this Act.
(4) The registration authority may reject the registration request if the non-cash contribution is significantly lower than the issue price of shares to be provided.
Article 345a
(Conditional increase of share capital by non-cash contributions without audit) A conditional increase in the share capital by non-cash contributions that need not be audited shall be subject, mutatis mutandis, to the provisions of Article 334a of this Act.
Article 346
(Notification of the resolution)
(1) The management and the president of the supervisory board shall notify the resolution to increase the share capital for registration.
(2) The notification shall be accompanied by the following:
– if the share capital is increased by non-cash contributions;
1. the contracts made for the acquisition of non-cash contributions;
2. In the case referred to in paragraph (1) of the preceding paragraph in connection with the first indent of paragraph (1) of Article 194a of this Act, a certificate of the single price
2. In the case referred to in paragraph (1) of the preceding paragraph in connection with the first indent of paragraph (1) of Article 194a of this Act, a certificate of the single price