HOCHTIEF PPP Solutions GmbH has sold stakes in two Chilean toll road project companies. Under the contract of sale, the seller is obliged in certain circumstances to provide the buyer with a guaranteed present value greater than the purchase price. HOCHTIEF Aktiengesellschaft has furnished a guarantee for the seller's obligations. A change of control at HOCHTIEF Aktiengesellschaft is consequently one of the circumstances that trigger the guaranteed present value obligation. The contract defines a change of control as when a party, or group of parties acting in concert, secures control of HOCHTIEF Aktiengesellschaft within the meaning of Section 29 (2) of the German Securities Acquisition and Takeover Act (WpÜG).
Under the terms of the liability insurance taken out by HOCHTIEF Aktiengesellschaft, the insurer has a right to alter the premiums and conditions in the event of a takeover of the Company. The terms of the D&O insurance taken out by HOCHTIEF Aktiengesellschaft provide for a limitation of insurance cover if another company or other third party gains control of HOCHTIEF Aktiengesellschaft. In such an event, the insurance solely covers claims relating
Above and beyond the mandatory disclosures under Sections 289 (4) 8 and 315 (4) 8 of the German Commercial Code, other Group companies are party to further agreements that are conditional upon a change of control. The following is an abridged and nonexhaustive presentation: A change of control at HOCHTIEF AirPort GmbH would have various legal consequences. In particular, such a change of control may trigger sale or purchase obligations relating to ownership interests held by HOCHTIEF AirPort GmbH. In the PPP segment, project contracts frequently accord the client substantial rights that make it difficult to effect a change of ownership structure in the project company.
If shareholders obtain control of HOCHTIEF Aktiengesellschaft as defined in Sections 29 and 30 of the German Securities Acquisition and Takeover Act (WpÜG), all members of the Executive Board in office in the year concerned are entitled – under agreements entered into with them before 2008 – to resign from office and simultaneously terminate their contracts at six months' notice. The members of the Executive Board are each similarly entitled in the event of other takeover-like contingencies specified in their contracts (including, among other things, the obtaining of a majority of voting rights at general shareholders' meetings). Executive Board members also have such a right if confronted by sustained and substantial pressure from shareholders demanding that they resign or take specific action which the members concerned are unable to reconcile with their personal responsibility for the exercise of office. In the event that their contracts are terminated by notice, terminated by mutual agreement or expire within nine months following a takeover, the departing Executive Board members receive in compensation for termination of their contracts a severance award equaling two-and-a-half years' benefits comprising their fixed annual compensation plus performance-linked compensation in the amount budgeted for in their contracts. If an Executive Board member"s contract has more than two-and-a-half years left to run from the effective date of termination, the severance award in
