Luxembourg Act of 10 August 1915 on commercial companies, consolidated and in force as at 1 July 2015

PART I. GENERAL PROVISIONS (ARTICLES 1-13)

Article 1

Commercial entities are those whose corporate purpose is to carry on commercial activities. They are governed by the agreements between the parties, mercantile law and practice and the civil law. They are divided into commercial entities in the strict sense and commercial associations.

Article 2

(amended by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), supplemented by the Act of 31 May 1999 (Official Gazette A77 of 21/06/1999 p. 1681), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 21 December 2006 (Official Gazette A228 of 27/12/2006 p. 4070), the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856))

The law recognises as commercial companies endowed with legal personality:

– société en nom collectif (general partnership);

– société en commandite simple (limited partnership);

– société anonyme (public limited liability company);

– société en commandite par actions (partnership limited by shares);

– société à responsabilité limitée (private limited liability company);

– société coopérative (cooperative company);

– société européenne (SE) (European companies).

Each constitutes a legal person separate from the legal personality of its members. A European company (SE) acquires legal personality on the date of its registration in the register of commerce and companies. The domicile of a commercial company is at the place where its central administration is carried on. The central administration of an entity is deemed to be the same as its registered office according to its articles of association unless proved otherwise. In addition there are sociétés commerciales momentanées (temporary commercial ventures), sociétés commerciales en participation (commercial participation ventures) and socié- tés en commandite spéciale (special purpose limited partnerships) which not have distinct legal personality separate from that of their members. The acquisition of a holding in any company falling under this article does not constitute a commercial act per se.

Article 3

(amended by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816))

Entities with non-commercial corporate purpose that opt to be subject to the rules set out in articles 1832 et seq. of the Civil Code, with the exception of the amendments made to these rules by this appendix [i.e. the Act of 18 September 1933], also have distinct legal personality from that of their members, and service of any process on behalf of or on such entities is valid if made in the name of the entity alone. The rules laid down in article 181, second to fifth paragraphs, apply to them. However, entities with non-commercial corporate purpose may use any of the six commercial entity forms listed in the preceding article. In this case, however, the entity and any transactions it conducts are deemed commercial in nature and thus subject to mercantile law and practice.

Non-commercial entities, regardless of the date of their incorporation, provided their deed of incorporation does not prohibit them from doing so, may also be converted into commercial entities by means of a resolution passed by a general meeting specifically called for that purpose. The meeting also sets down the entity’s articles of association. The resolution is only valid if approved by shareholders representing at least three-fifths of the entity’s share capital. Finally, any of the first six types of entities listed in article 2 may, regardless of the original nature of their corporate purpose or the date of their incorporation, provided their instruments of incorporation do not prohibit same, be converted into another form of entity provided for in that same article, with the exception of a European company (SE).

A public limited liability company governed by Luxembourg law may be converted into a European company (SE) if, for at least the last two years, it has had a subsidiary governed by the laws of another Member State of the European Economic Area, hereinafter referred as a “Member State”. A European company (SE) that has its registered office in the Grand Duchy of Luxembourg may convert into a public limited liability company governed by Luxembourg law. The conversion decision may not be taken within two years from its registration or before approval of its first two sets of financial statements. The conversions referred to in this article do not give rise to the dissolution of the entity or the creation of new legal personality. The rights of third parties are reserved.

Article 4

(amended by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) General partnerships, limited partnerships, cooperative companies, non-commercial companies and special purpose limited partnerships may only be validly established by means of special notarially recorded deeds or instruments under private seal, in the latter case in accordance with article 1325 of the Civil Code, failing which they are void. Two originals are sufficient for non-commercial entities, cooperative companies, limited partnerships and special purpose limited partnerships. Public limited liability companies, partnerships limited by shares and private limited liability companies must be incorporated by means of special notarially recorded instruments, failing which they are void.

Article 5

(amended by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) The deeds or instruments of a partnership, a limited partnership and a special purpose limited partnership are published in extract form at the partnership’s expense.

Article 6

(amended by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) The extract must contain the following information, failing which the penalties laid down in article 10 apply:

1) precise designation of the general partners;

2) the partnership’s name or appellation, together with stipulation of its corporate purpose and the address of its registered office;

3) the names of the managers, their signing authority and, for general partnerships, the nature of, and limits on, their powers;

4) the term for which the partnership exists.

Article 7

The extract of the deed or instrument is signed: for public deeds, by the notary with whom the engrossment is lodged; and, for instruments under private seal, by all the general partners.

Article 8

(amended by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), supplemented by the Act of 20 April 2009 (Official Gazette A80 of 27/04/2009 p. 946)) The deeds of incorporation of public limited liability companies, partnerships limited by shares, private limited liability companies, cooperative companies and non-commercial companies are published in full. Powers of attorney, both officially recorded and private, which are annexed to such deeds need not be published in the Official Gazette C, Digest of Companies and Associations, or lodged with the register of commerce and companies. By derogation from the first paragraph, the deed of incorporation of non-commercial entities that are regarded as family companies within the meaning of article III of the Act of 18 September 1933 instituting the private limited liability company and making certain changes to the legal and tax rules applicable to commercial and non-commercial entities may be published in the form of an extract signed by the managers, failing whom by all the members, which must contain the following information, failing which the penalties laid down in article 10 shall apply:

– precise designation of the members;

– the name of the company, its corporate purpose and the address of its registered office;

– designation of the managers and the nature of, and limits on, their powers;

– details of the assets provided or to be provided by each member, with a precise valuation of contributions in kind;

– the date on which the term for which the partnership exists starts and ends.

Article 9

(supplemented by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), the Act of 8 August 1985 (Official Gazette A49 of 28/08/1985 p. 931), the Act of 2 December 1993 (Official Gazette A94 of 12/12/1993 p. 1740), the Grand-Ducal Regulations of 23 December 1994 (Official Gazette A116 of 24/12/1994 p. 2735), the Act of 19 December 2002 (Official Gazette A149 of 31/12/2002 p. 3651), the Act of 20 April 2009 (Official Gazette A80 of27/04/2009 p. 946))

1. Deeds or instruments, extracts of deeds or instruments or particulars whose publication is required by law shall be lodged with the register of commerce and companies within one month of their being final. A receipt shall be issued. The documents submitted shall be stored in a file kept for each company.

** 1.** Any person may, free of charge, examine documents lodged for a given company and obtain, even by correspondence, a full or partial copy thereof, the only payment required being the administrative fees fixed by grand-ducal regulations. Such copies are certified true copies, unless the applicant waives this formality.

2. Publication shall be made in the Official Gazette C, Digest of Companies and Associations; published deeds or instruments shall be sent to the register of commerce and companies, where they may be examined by any person free of charge and will be collated in a Special Digest.

Publication must be effected within two months from filing. Publication in the Official Gazette C, Digest of Companies and Associations of financial statements, consolidated financial statements and all other related documents and information whose publication is required by law shall be done by means of a reference to the filing of these documents with the register of commerce and companies.

3. Deeds or instruments or extracts of deeds or instruments are only binding against third parties as from the date of their publication in the Official Gazette C, Digest of Companies and Associations unless the entity proves that those third parties had prior knowledge thereof. Third parties may nonetheless rely on deeds or instruments or extracts of deeds or instruments that have not yet been published. With regard to transactions that occur before the sixteenth day following publication, such deeds and extracts of deeds are not binding against third parties who prove that it was impossible for them to have known of them. In the event of a discrepancy between a lodged document and the version published in the Official Gazette C, Digest of Companies and Associations, the latter is not binding against third parties. They may nonetheless rely thereon unless the company proves that they were aware of the lodged text.

Article 10

(amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), the Grand-Ducal Regulation of 23 December 1994 (Official Gazette A116 of 24/12/1994 p.2735, implicitly modified by the Act of 1 August 2001 (Official Gazette A117 of 18/09/2001 p. 2440)) If filing is not effected within the time period required by the preceding article, the collector of registration duties will levy a fine in a sum equal to one-thousandth of the entity’s capital, providing always it shall not be less than 25 euros or more than 250 euros. This fine shall be due upon registration of the late filing and shall be levied by the collector ex officio. For public deeds, the fine shall be payable by the notary or notaries public jointly and severally and, for instruments under private seal, by those members who are jointly and severally liable failing whom by the founding members and also jointly and severally by any persons required by law to effect the relevant filing. Any legal action brought by an entity whose deed of incorporation has not been published in the Official Gazette C, Digest of Companies and Associations, in accordance with the foregoing articles shall be inadmissible.

Article 11

(supplemented by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586)) In order to be valid, any contractual amendment to a deed or instrument must be made in the form required for the entity’s deed or instrument of incorporation.

Article 11bis

(inserted by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), amended by Grand-Ducal Regulation of 23 December 1994 (Official Gazette A116 of 24/12/1994 p. 2735), supplemented by the Act of 31 May 1999 (Official Gazette A77 of 21/06/1999 p. 1681), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), supplemented by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856), the Act of 28 July 2014 (Official Gazette A161 of 14/08/2014 p.2484)).

1. The following shall be lodged and published in accordance with the preceding articles:

1) deeds whose publication in the Official Gazette C, Digest of Companies and Associations, is required by law, with the exception of notices calling meetings filing of which is not compulsory;

2) deeds amending provisions whose filing and publication are required by law;

3) extract from documents relating to the appointment to office or cessation of office of:

a) directors, members of the board of management and supervisory board, managers and statutory auditors of public limited liability companies, partnerships limited by shares, private limited liability companies, limited partnerships, special purpose limited partnerships and non-commercial entities;

b) the persons to whom the daily management of public limited liability companies has been delegated;

c) liquidators of entities with legal personality and, where appropriate, of special purpose limited partnerships.

d) (Inserted by the Act of 28 July 2014 (Official Gazette A 161 of 14/08/2014 P.2484)) custodians of public limited liability companies and of partnerships limited by shares designated in application of article 42. The extract shall clearly indicate the last and first names and the private or professional address of the persons referred to therein;

4) extract from deeds or instruments determining the manner of liquidation and the powers of the liquidators if these powers are not exclusively and expressly defined by law or the articles of association;

5) extract from any judicial decision which has either become final or is provisionally enforceable, dissolving a company or declaring it void or declaring amendments to its articles of association to be void.

This extract shall contain:

a) the appellation or name of the entity and its registered office;

b) the date of the decision and the court that rendered it;

c) where applicable, the appointment of a liquidator or liquidators.

2. The following shall be set down in a statement signed by the competent corporate organs:

1) dissolution of the entity due to expiry of the term for which it was incorporated or on any other ground;

2) the death of a person referred to in §1(3) of this article;

3) for private limited liability companies and non-commercial entities, any changes in the membership structure. These statements shall be lodged and published in accordance with the preceding articles.

3. The full text of the articles of association, updated after each amendment to the articles of association of public limited liability companies, partnerships limited by shares and private limited liability companies, shall be lodged in accordance with the preceding articles.

A notice shall be published in the Official Gazette C, Digest of Companies and Associations in accordance with the preceding articles indicating the subject-matter and the date of the deeds whose filing is required by this subarticle.

** 4.** Deeds and particulars whose publication is required by the preceding subarticles are binding against third parties in accordance with the conditions laid down in article 9 §4.

Article 12

(supplemented by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Entities act through their managers, directors or the members of their board of management, as the case may be, whose powers are determined by law or their deed or instrument of incorporation and by later deeds or instruments in execution of the deed or instrument of incorporation. With respect to persons who have power to bind entities in their capacity as a corporate organ, completion of the publication formalities renders any irregularity in their appointment not binding against third parties unless the entity proves that the third party was aware thereof.

Article 12bis

(inserted by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586)) Persons who, on behalf of an entity in formation that has not yet acquired legal personality, incur a commitment pursuant to any title, including under a covenant or as a negotiorum gestor, shall be personally and jointly and severally liable for the obligation, unless agreed otherwise, if the commitments are not assumed by the entity within two months from its incorporation or if the entity is not incorporated within two years from the inception of the commitment. Where the commitments are assumed by the entity, they shall be deemed to have been contracted by the entity from the outset.

Article 12ter

(inserted by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), amended by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864)) A public limited liability company, partnership limited by shares and private limited liability company may be declared void only in the following cases:

1) the deed of incorporation is not drawn up in notarised form;

2) that deed does not indicate the name of the entity, its corporate purpose, the capital contributions or the amount of subscribed capital;

3) the corporate purpose are unlawful or contrary to public policy;

4) there is not at least one founder who is validly bound. If the clauses of the deed of incorporation regarding the allocation of profits or losses are contrary to article 1855 of the Civil Code, they shall be deemed non-existent, without prejudice to other penalties; the same shall hold true for any other provision that is contrary to a mandatory rule of law, public policy or morality.

Article 12quater

(inserted by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), amended by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856))

** 1.** A judicial decision is needed in order for an entity endowed with legal personality to be declared void. The effects of the entity’s being void commence as from the date of the judicial decision ordering same. However, it is only binding against third parties as from publication of the decision, as required by article 11bis §1, 5) and under the conditions set out in article 9.

2. An entity or member may not assert the fact of an entity endowed with legal personality being void on grounds of formal irregularities, pursuant to articles 4 or 12ter, first paragraph, 1) or 2), or the fact of a special purpose limited partnership being void on grounds of formal irregularities pursuant to article 16(7), first paragraph, (a), or article 22-1(8)(a), against third parties, even as a preliminary plea, unless it has been confirmed by a judicial decision published in accordance with § 1.

3. §§ 1 and 2 apply to voidance of contractual amendments to deeds of incorporation pursuant to article 11bis. Article 12quinquies (inserted by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586)) The fact of an entity’s being void pursuant to a judicial decision in accordance with article 12quater results in liquidation of the entity as in the case of dissolution. The fact of its being void does not per se affect the validity of the entity’s commitments or those entered into in its favour, without prejudice to the effects of its liquidation. The courts may determine the method of liquidation and appoint the liquidators.

Article 12sexies

(inserted by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586)) No third-party application to set aside a judicial decision declaring an entity endowed with legal personality or a contractual amendment to its articles of association to be void is admissible after the expiry of a period of six months from publication of the judicial decision in accordance with article 11bis §1, 5).

Article 13

(amended by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) Temporary commercial ventures and commercial ventures are not subject to the formalities laid down for commercial entities endowed with legal personality. Their existence may be determined by the means of proof accepted in mercantile matters.

PART II. GENERAL PARTNERSHIPS (ARTICLES 14-15)

Article 14

A general partnership is an entity that operates under an appellation and in which all the partners are jointly and severally liable without limitation for the commitments of the partnership.

Article 15

Only the names of the partners may be included in the appellation.

PART III. LIMITED PARTNERSHIPS AND SPECIAL PURPOSE LIMITED PARTNERSHIPS

(ARTICLES 16-22) (the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) Sub-part 1. Limited partnerships (articles 16-22) (inserted by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856))

Article 16

(amended by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856))

(1) A limited partnership is a an entity contracted for a limited or unlimited period of time by one or more general partners with unlimited, joint and several liability for all commitments of the partnership and one or more limited partners, who only commit a specific stake, constituting an ownership interest, which may or may not be represented by securities, in accordance with the terms of the partnership agreement.

(2) Partners may make contributions to the partnership in cash or in kind or contribute services. Contributions, including the admission of new partners except in the event of the transfer of ownership interests, shall be made in accordance with the terms and formalities set down in the partnership agreement.

(3) The partnership may issue debt securities.

(4) Unless the partnership agreement provide otherwise, a general partner may also be a limited partner, provided there is at all times at least one general partner and one limited partner who are legally distinct from each other.

(5) The partnership shall have a distinct name or an appellation comprising the names of one or more partners.

(6) A limited partnership must keep a register containing the following information:

a) a true, up-to-date copy of the complete partnership agreement;

b) a list of all partners, stating for each their surname, first names, occupations and private or business address or, for legal persons, their corporate name or appellation, legal form, precise address and registration number in the register of commerce and companies if the law of the State by which the company is governed provides for such a number, and the ownership interests held by each;

c)a record of transfers of ownership interests in the partnership and the date of notification or acceptance of such transfers. All partners may inspect this register, subject to the limitations laid down in the partnership agreement.

(7) A limited partnership may be declared void only in the following cases:

a) the deed of incorporation does not state the partnership’s appellation or name or corporate purpose;

b) the corporate purpose is unlawful or contrary to public policy;

c) there is not at least one general partner and one limited partner, distinct from each other, who are validly bound. Articles 12quater to 12sexies shall apply.

Article 17

(amended by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) Management of a limited partnership shall be carried on by one or more managers, who need not be general partners, appointed in accordance with the partnership agreement. Managers who are not general partners are liable pursuant to article 59. The partnership agreement may allow managers to delegate their powers to one or more agents, who shall be responsible only for the performance of their mandate. Unless the partnership agreement provide otherwise, each manager may, on behalf of the partnership, carry out all acts necessary or useful to achieve its corporate purpose. Any limitations imposed on the powers of the managers by the partnership agreement are not binding against third parties, even if published. Nevertheless, the partnership agreement may authorise one or more managers to represent the partnership alone or jointly, and this clause is binding against third parties under the conditions laid down in article 9. The partnership is bound by any acts carried out by its manager(s), even if such acts are ultra vires, unless it can be demonstrated that the third party in question knew or, in view of the circumstances, could not have been unaware of their ultra vires nature. Each manager represents the partnership in dealings with third parties and in legal procedures as plaintiff or defendant. The service of process on behalf of or on the partnership shall be valid if done in the name of the partnership alone.

Article 18

(amended by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) A limited partner may enter into any transaction with the limited partnership without his ranking as a unsecured or preferred creditor, in accordance with the terms of the transaction in question, being affected by the mere fact of him being a limited partner. He may not perform any act of management with regard to third parties. A limited partner shall be jointly and severally liable without limitation to third parties for any commitments of the partnership in which he has participated in breach of the preceding paragraph.

In addition, he shall also be jointly and severally liable without limitation to third parties, even for any commitments of the partnership in which he has not participated, if he usually makes management decisions with regard thereto. Exercise of the prerogatives of partners, the provision of opinions and advice to the partnership, its affiliates or their managers, acts of audit and supervision, the granting of loans, guarantees or collateral or any other assistance to the partnership or to its affiliates, as well as authorisations to the managers in the cases provided for in the partnership agreement for ultra vires acts shall not constitute management decisions for which a limited partner may be held jointly and severally liable without limitation to third parties. A limited partner may serve as member of a management organ or as the representatives of a manager of the partnership, even a general partner, or sign on behalf of the latter, even when acting as a representative of the partnership, without thereby incurring joint and several liability without limitation for the partnership’s commitments, provided the representative capacity in which he acts is stipulated.

Article 19

(amended by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) Distributions and repayments to partners, as well as the conditions under which the limited partnership may request the return thereof, are governed by the partnership agreement. Unless the partnership agreement provides otherwise, each partner’s share of the profits and losses of the partnership shall be in proportion to his ownership interest.

Article 20

(amended by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) Unless the partnership agreement provides otherwise, the voting rights of each partner shall be in proportion to his ownership interest. Any amendment to the corporate purpose, nationality or legal form or decision to liquidate must be adopted by the partners. The partnership agreement shall determine, from among st the other decisions, those which are not taken by the partners. They shall also determine the forms in which and the conditions under which these decisions must be taken. Failing such stipulations in the partnership agreement:

a) the decisions of the partners shall be taken in general meeting or by means of written consultation, with each partner receiving the text of the expressly formulated resolutions or decisions to be taken and voting in writing;

b) no decision shall be validly taken unless it is approved by a majority of the votes cast, regardless of the percentage of ownership interests represented, except decisions to change the corporate purpose, nationality or legal form of or liquidate the partnership, which must be approved by partners representing at least three-quarters of the ownership interests and, in any case, all the general partners;

c) these meetings or written consultations may be called or initiated by the manager(s) or by partners representing more than half the ownership interests. At least once a year, the partners shall approve the financial statements by means of a special vote on the date set out in the partnership agreement and at the latest six months from the closing of the financial year. The partnership agreement may provide that the first special vote can take place within eighteen months following the formation of the partnership. Fifteen days, or any longer period provided for in the partnership agreement, before the date on which the partners must approve the financial statements, they may inspect and obtain a copy of the following at the registered office:

1) the annual financial statements;

2) the management report, if applicable;

3) the report by the accredited company auditors, if applicable;

4) any other information provided for by the partnership agreement.

Article 21

(amended by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) The ownership interests of limited partners may only be transferred, divided or pledged under the terms and in the manner set out in the partnership agreement, failing which same shall be void. Unless the partnership agreement provide otherwise, any transfer other than a transfer by the reason of death, a division and a pledge of a limited partner’s interest shall require the consent of the general partner(s). The ownership interests of general partners may only be transferred, divided or pledged under the terms and in the manner prescribed by the partnership agreement, failing which same shall be void. Unless the partnership agreement provide otherwise, any transfer other than transfer by reason of death, a division and a pledge of any portion of a general partner’s ownership interest must be approved by the partners deliberating according to the procedures for an amendment of the partnership agreement. Transfers and divisions of ownership interests are binding against the partnership and third parties only after being notified to or accepted by the partnership. They may not, however, be relied on against third parties as regards any commitments of the partnership incurred prior to their publication, unless the third party knew or could not have been unaware thereof.

The partnership agreement may authorise the management or the partners to reduce or repurchase, in whole or in part, as appropriate, if requested by one or more partners, of the ownership interests of one or more partners and define the procedure to this end.

Article 22

(amended by the Act of 11 August 1996 (Official Gazette A53 of 20/08/1996 p. 1660), the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) In the event of the death, dissolution, legal incapacity, recall, resignation, impediment, bankruptcy or any other situation involving the solvency of a general partner, if there is no other general partner and it has been provided that the partnership is to continue in existence, arrangements shall be made for a replacement. In the absence of specific provisions in that regard in the partnership agreement, the judge presiding the division of the local court sitting in commercial matters may, on a petition by any interested party, appoint a provisional administrator, who need not be a partner, who shall engage in all urgent acts and all simple administrative measures, pending a decision by the partners, which the administrator shall procure within fifteen days of his appointment. The administrator is only liable for the exercise of his mandate. Any interested party may appeal the order appointing the provisional administrator; the appeal is served on the company as well as on the appointee and the petitioner requesting the appointment. It is ruled on under the urgent applications procedure.

Sub-part 2. Special purpose limited partnerships (articles 22-1 to 22-9) (inserted by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856))

Article 22-1

(inserted by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856))

(1) A special purpose limited partnership is a partnership contracted, for a limited or unlimited period of time, by one or more general partners who are jointly and severally liable without limitation for all commitments of the partnership and one or more limited partners who commit only a specific stake, constituting ownership interests, which may or may not be represented by securities, in accordance with the terms of the partnership agreement.

(2) A special purpose limited partnership does not have separate legal personality from its partners. It may either have a distinct partnership name or an appellation comprising the names of one or more partners.

(3) Partners may make contributions in cash, in kind or in services. Contributions, including the admission of new partners aside from transfers of ownership interests, shall be made in accordance with the terms and formalities laid down in the partnership agreement.

(4) The partnership may issue debt securities.

(5) Unless otherwise stipulated in the partnership agreement, a general partner may also be a limited partner, provided there is at all times at least one general partner and one limited partner who are legally distinct from each other.

(6) A special purpose limited partnership must keep a register containing the following information:

a) a true, up-to-date copy of the complete partnership agreement;

b) a list of all partners, stating for each their surname, first names, occupations and private or business address or, for legal persons, their business or name or appellation, legal form, precise address and registration number in the register of commerce and companies, if the law of the State by which the entity is governed provides for such a number, and the ownership interest held by each;

c) a record of transfers of ownership interests and the date of notification or acceptance of such transfers. All partners may inspect this register, subject to the limitations laid down in the partnership agreement.

(7) The domicile of a special purpose limited partnership is at the place where its central administration is carried on. it’s the central administration is deemed to be the same as the location of the registered office according to its partnership agreement unless proved otherwise.

(8) A special purpose limited partnership may be declared void only in the following cases:

a) the deed of incorporation does not state the partnership’s appellation or name or its corporate purpose;

b) the corporate purpose is unlawful or contrary to public policy;

c) there is not at least one general partner and one limited partner, distinct from each other, who are validly bound. Articles 12quater to 12sexies apply.

Article 22-2

(inserted by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856))

(1) Registration and other formalities relating to the common property of a special purpose limited partnership or to property to which it has any rights shall be made in the name of the special purpose limited partnership.

(2) The common property of a special purpose limited partnership may be used to satisfy creditors’ rights only insofar as such rights arose on the occasion of the formation, running or liquidation of the partnership.

Article 22-3

(inserted by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) Management of a special purpose limited partnership shall be entrusted to one or more managers, who need not be general partners, appointed in accordance with the partnership agreement. Managers who are not general partners shall be liable in accordance with article 59. The articles of partnership may allow the managers to delegate their powers to one or more representatives who are liable solely for the performance of their mandate.

Unless the partnership agreement provides otherwise, each manager may act in the name of the partnership in carrying out all acts necessary or useful to achieve its corporate purpose. Any limitations on the powers of the managers in the partnership agreement are not binding against third parties, even if published. Nevertheless, the partnership agreement may authorise one or more managers to represent the partnership, alone or jointly, and this clause is binding as against third parties subject to the conditions laid down in article 9.

The partnership is bound by any acts carried out by the manager(s), even if such acts are ultra vires, unless it can be demonstrated that the third party knew or, in view of the circumstances, could not have been unaware of their ultra vires nature. Each manager represents the company in dealings with third parties and in legal procedures as plaintiff or defendant. The service of any process on behalf of or on the special purpose limited partnership is valid if done in the name of the partnership alone, represented by one of its managers.

Article 22-4

(inserted by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) A limited partner may enter into any transaction with the special purpose limited partnership without his ranking as an unsecured or preferred creditor, in accordance with the terms of the transaction in question, being affected by the mere fact of him being a limited partner. He may not perform any act of management with regard to third parties. A limited partner shall be jointly and severally liable without limitation to third parties for any commitments of the partnership in which he has participated in breach of the preceding paragraph.

In addition, he shall be jointly and severally liable without limitation to third parties, even for any commitments of the partnership in which he has not participated, if he usually makes management decisions with regard thereto. Exercise of the prerogatives of partners, the provision of opinions and advice to the special purpose limited partnership, its affiliates or their managers, acts of audit and supervision, the granting of loans, guarantees or collateral or any other assistance to the special purpose limited partnership or its affiliates, as well as authorizations to the managers in the cases provided for in the partnership agreement for ultra vires acts shall not constitute management decisions for which a limited partner may be held jointly and severally liable without limitation to third parties.

A limited partner may serve as member of a management organ or as representatives of a manager of a special purpose limited partnership, even a general partner, or sign on behalf of the latter, even when acting as a representative of the special purpose limited partnership, without thereby incurring joint and several liability without limitation for the partnership’s commitments, provided the representative capacity in which he acts is stipulated.

Article 22-5

(inserted by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) Distributions and repayments to partners, as well as the conditions under which the special purpose limited partnership may request the return thereof, shall be governed by the partnership agreement. Unless the partnership agreement provides otherwise, each partner’s share of the profits and losses of the special purpose limited partnership shall be in proportion to his ownership interest.

Article 22-6

(inserted by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) Unless the partnership agreement provides otherwise, the voting rights of each partner shall be in proportion to his ownership interest. Any amendment to the corporate purpose, nationality or legal form or decision to liquidate must be approved by the partners. The partnership agreement shall determine, from amongst the other decisions, those which are not taken by the partners. They shall also determine the forms in which and the conditions under which these decisions must be taken. Failing such stipulation in the partnership agreement:

a) decisions of the partners shall be taken in general meeting or by means of written consultation, with each partner receiving the text of the expressly formulated resolutions or decisions to be taken and voting in writing;

b) no decision shall be validly taken unless it is approved by a majority of the votes cast,regardless of the percentage of ownership interests represented, except decisions to change the corporate purpose, nationality or legal form of or liquidate the partnership, which must be approved by partners representing at least three-quarters of the ownership interests and, in any case, all general partners;

c) these meetings or written consultations may be called or initiated by the manager(s) or by partners representing more than half the ownership interests. The information to be submitted to the partners shall be limited to that laid down in the partnership agreement.

Article 22-7

(inserted by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) The ownership interests of limited partners may only be transferred, divided or pledged under the terms and in the manner set out in the partnership agreement, failing which same shall be void. Unless the partnership agreement provides otherwise, any transfer other than a transfer by the reason of death, a division and a pledge of a limited partner’s ownership interest shall require the consent of the general partner(s).

The ownership interests of general partners may only be transferred, divided or pledged under the terms and in the manner prescribed by the partnership agreement, failing which same shall be void. Unless the articles of partnership provide otherwise, any transfer other than a transfer by the reason of death, a division and a pledge of any portion of a general partner’s ownership interest must be approved by the partners deliberating according to the procedures for an amendment of the partnership agreement. Transfers and divisions of ownership interests are binding against the partnership and third parties only after being notified to or accepted by the partnership. They may not, however, be relied on against third parties as regards any commitments of the partnership incurred prior to their publication, unless the third party knew or could not have been unaware thereof.

The partnership agreement may authorise the management or the partners to reduce or repurchase, in whole or in part, as appropriate, if requested by one or more partners, of the ownership interests of one or more partners and define the procedure to this end.

Article 22-8

(inserted by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) In the event of death, dissolution, legal incapacity, recall, resignation, impediment, bankruptcy or any other situation involving the solvency of a general partner, if there is no other general partner and it has been provided that the partnership is to continue in existence, arrangements shall be made for a replacement. In the absence of specific provisions in that regard in the partnership agreement, the judge presiding the division of the local court sitting in commercial matters may, on a petition by any interested party, appoint a provisional administrator, who need not be a partner, who shall take all urgent and simple administrative acts, pending a decision by the partners, which the administrator shall procure within fifteen days of his appointment. The provisional administrator is only liable for the exercise of his mandate. Any interested party may appeal the order appointing the provisional administrator; the appeal is served on the partnership and on the appointee and the petitioner requesting the appointment. It is ruled on under the urgent applications procedure.

Article 22-9

(inserted by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) The conversion of a special purpose limited partnership into another legal form, as set out in article 2, first paragraph, shall give rise to the creation a new personality. In addition to the conditions laid down in the partnership agreement, the requirements in terms of both form and substance for the creation of the corporate form into which the special purpose limited partnership is converted shall apply.

PART IV. PUBLIC LIMITED LIABILITY COMPANIES AND EUROPEAN COMPANIES (SE) (ARTICLES 23 TO 101-17)

1. The nature and characterization of public limited liability companies and European companies (SE) (articles 23 to 25)

Article 23

(replaced by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) A public limited liability company is one whose capital is divided into shares and which is established by one or more persons contributing a specific amount. Where the company has only one member, he is referred to as the “sole shareholder”. Public limited companies may have a sole shareholder upon incorporation or due to the consolidation of all shares in the hands of a single person. The death or dissolution of the sole shareholder shall not result in the dissolution of the company.

(2) A European company (SE) is a public limited liability company incorporated in accordance with article 2 of Regulation (EC) no. 2157/2001 of the Council of 8 October 2001 on the Statute for a European company (SE), whose registered office and central administration are located in the Grand Duchy of Luxembourg. It may transfer its registered office to another Member State without losing its legal personality.

It is subject to the provisions of this act applicable to public limited liability companies and to the provisions expressly applicable to European companies (SEs) set out in Regulation (EC) no. 2157/2001 of the Council of 8 October 2001 on the Statute for a European company (SE).

Article 24

A public limited liability company does not operate under an appellation; it is not designated by the names of any of its members.

Article 25

(supplemented by the Act of 25 August 2006 (Official Gazette. A152 of 31/08/206 p. 2684)

(1) A public limited liability company is characterised by a specific corporate name or by a designation of its corporate purpose. The name or designation must be different from that of any other entity. If it is identical, or if the similarity could be misleading, any interested party may cause it to be changed and claim any damages he may have suffered, as the case may be.

(2) Only European companies (SE) may include the abbreviation “SE” in their corporate name. Nevertheless, companies and other legal entities registered in a member State before the entry into effect of Regulation (EC) no. 2157/2001 of the Council of 8 October 2001 on the Statute for a European company (SE) whose corporate name includes the abbreviation “SE” are not required to change their name.

2. The incorporation of public limited liability companies and European companies (SE) (articles 26 to 32-4) (heading supplemented by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)

Article 26

(amended by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) The following requirements apply to the incorporation of a public limited liability company:

1) There must be at least one shareholder;

2) The capital must be at least 30,986.69 euros; however, this amount may be increased by a grand-ducal regulation based on the opinion of the Conseil d’Etat in order to take into account either variations in national currency in relation to the unit of account or changes in Community law; For a European company (SE), the capital must be at least 120,000 euros.

3) The capital must be entirely subscribed;

4) At least one-quarter of each share must be paid up in cash or by means of contributions other than in cash.

(2) The officiating notary public shall verify that these conditions, together with those set out in articles 26-1(2), 26-3 and 26-5, are satisfied and shall expressly ascertain compliance therewith.

Article 26bis

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) A European company (SE) may be incorporated by means of a merger of public limited liability companies incorporated under the laws of a member State with their registered offices and central administration in the European Community, provided at least two of these companies are governed by the laws of different Member States.

In that case, the laws of the member State governing each merging company apply as in the case of a merger of public limited liability companies, taking into account the cross-border nature of the merger, with regard to protection of the interests of:

– creditors of the merging companies;

– bond holders of the merging companies;

– the holders of securities, other than shares, to which special rights in the merging companies attach.

(2) A holding European company (SE) may be incorporated by public limited liability companies and private limited liability companies incorporated under the laws of a Member State with their registered office and central administration in the Community, provided at least two of them:

a) are governed by the laws of different member States, or

b) have, for at least the past two years, had a subsidiary governed by the laws of another member State or a branch located in another member State.

(3) A subsidiary European company (SE) may be incorporated by non-commercial or commercial entities endowed with legal personality, with the exception of non-profit entities, and by other public or private law legal persons constituted under the laws of a Member State and having their registered office and central administration in the Community and subscribing for its shares, provided at least two of them:

a) are governed by the laws of different member States, or

b) have, for at least the past two years, had a subsidiary governed by the laws of another member State or a branch located in another member State.

(4) An entity whose central administration is not located in a member State may participate in the incorporation of a European company (SE) provided it is constituted under the laws of a member State, has its registered office in that member State and has a real and continuous link with a member State’s economy.

Article 26ter

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

A holding European company (SE) may be incorporated in accordance with article 26bis (2). Entities promoting the incorporation of the European company continue in existence. Articles 26quater to 26octies apply.

Article 26quater

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The management organs of the entities promoting the operation draw up plan for the establishment of the European company (SE). The plan includes a report explaining and justifying the legal and economic aspects of the incorporation and stipulating the implications for members and employees of adopting the legal form of a European company (SE). The plan also includes:

a) the name and registered office of each company incorporating the European company (SE), as well as those proposed for the European company (SE);

b) the share or unit exchange ratio and, if applicable, the amount of any balancing cash payment;

c) the terms for the allotment of shares in the European company (SE);

d) the rights conferred by the European company (SE) on the members holding special rights and the holders of securities other than shares or the measures proposed in their regard;

e) any individual benefit granted to the experts who examine the draft terms of merger and to the members of the administrative, management, supervisory or audit organs of the merging entities;

f) the articles of association of the European company (SE);

g) information on the procedures by which arrangements for employee involvement are determined in transposition of Directive 2001/86/EC;

h) the minimum percentage of shares or units in each entity promoting the transaction that the members must contribute in order for the European company (SE) to be incorporated.

This proportion shall consist of shares or units conferring more than fifty per cent of the permanent voting rights.

Article 26quinquies

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684) For each company promoting the operation, the incorporation plan shall be published in the manner laid down in article 9 or in accordance with the laws of each Member State in transposition of article 3 of Directive 68/151/EEC at least one month before the date of the general meeting called to approve the incorporation plan.

Article 26sexies

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), amended by the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295))

(1) The incorporation plan shall be subject to review and a written report intended for the members. This review shall be performed and the report drawn up by one or more independent experts for each entity promoting the transaction. These experts shall be designated or accredited by a judicial or administrative authority in the home member State of each entity in accordance with the provisions of national law transposing Directive 78/855/EEC.

For companies governed by Luxembourg law, the experts shall be accredited company auditors appointed by the management body. However, the report may be drawn up by one or more independent experts for all the companies promoting the transaction. In this case, the expert shall be appointed by the judicial or administrative authority of the member State whose law governs one of the entities concerned or the future European company (SE), in accordance with the provisions of national law transposing Directive 78/855/EEC. For Luxembourg, this authority is the judge presiding the commercial division of the local court of the judicial district in which the one of entities concerned has its registered office, ruling as under the urgent applications procedure on a joint petition by the entities concerned.

(2) In the report referred to in the subarticle (1), the experts shall in all events state whether the proposed share exchange ratio is relevant and reasonable. This statement shall:

a) indicate the methods used to set the proposed exchange ratio;

b) indicate whether such methods are appropriate in the situation, detail the values resulting from the application of each of these methods, and issue an opinion on the relative importance attributed to these methods in determining the adopted value.

The report shall also mention any specific valuation difficulties.

(3) The rules set out in article 26-1(2) to (4) shall not apply.

(4) Each expert has the right to obtain all useful information and documents from the entities promoting the operation and to perform the necessary verifications.

Article 26septies

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The general meeting of each entity promoting the operation approves the plan for establishment of the European company (SE), as do the holders of any securities other than shares if applicable. Employee involvement in the European company (SE) is determined pursuant to the provisions transposing Directive 2001/86/EC. The general meeting of each entity promoting the operation may make registration of the European company (SE) subject to express approval of the arrangements thus decided.

Article 26octies

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) The members of the entities promoting the operation have a period of three months within which they can inform the promoting entities whether they intend to contribute their shares with a view to incorporation of the European company (SE). This period starts to run on the date on which the plan for establishment of the European company (SE) is approved by the general meetings referred to in article 26septies.

(2) The European company (SE) is only incorporated if, within the period referred to in subarticle (1), the members of the entities promoting the transaction contribute the minimum percentage of shares in each entity as fixed in accordance with the establishment plan and if all other conditions are fulfilled.

(3) The notary public’s finding that all requirements for incorporation of the European company (SE) have been met in accordance with subarticle (2) shall be published for each promoting entity in accordance with article 9 or the provisions laid down in the laws of each member State in transposition of article 3 of Directive 68/151/EEC. The members of the entities concerned that do not indicate whether they intend to make their shares available to the promoting entities for the purpose of incorporating the European company (SE) within the period referred to in subarticle (1) have an additional month in which to do so.

(4) Shareholders that have contributed their securities for the purpose of incorporating the European company (SE) receive shares therein.

(5) The European company (SE) may not be registered until it is demonstrated that the formalities referred to in articles 26ter to 26septies and the conditions referred to in subarticle (2) have been fulfilled.

Article 26nonies

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) A subsidiary European company (SE) may be incorporated in accordance with sub article (3) of article 26bis. Companies or other legal entities referred to in sub article (3) of article 26bis and participating in such an operation are subject to the provisions governing participation by them in the incorporation of a subsidiary having the form of a public limited liability company under national law.

Article 26-1

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), amended by the Act of 28 June 1984 (Official Gazette A81 of 23/06/1984 p. 1346), supplemented by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295))

(1) The shares issued in consideration for contributions other than in cash must be paid up within a period of five years from the time of incorporation.

(2) Prior to incorporation of the company, a report on any contributions other than in cash must be prepared by an accredited company auditor appointed by the founders.

(3) This report must relate to the description of each proposed contribution as well as the valuation methods used and state whether the values arrived at by applying these methods correspond to at least the number and nominal value failing which the accounting par of and any share premium on the shares to be issued in consideration. The report shall remain appended to the deed provided for by article 27 or the draft deed provided for by article 29. His conclusions must be included in the aforementioned documents.

(3bis)Subarticles (2) and (3) do not apply where, further to a decision of the board of directors or board of management, securities within the meaning of article 4(1)(18) of Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on markets in financial instruments, or money market instruments within the meaning of article 4(1)19) of that directive, are contributed within a contribution other than in cash and valued at the weighted average price at which they have been traded on one or more regulated markets within the meaning of article 4(1)14) of the said directive over a period of six months preceding the effective date of the contribution other than in cash.

However, where the price has been affected by exceptional circumstances capable of significantly altering the value of the asset on the effective date on which it is contributed, notably where the market for such securities or money market instruments has become liquid, a revaluation is done at the initiative and under the responsibility of the board of directors or board of management. For the purposes of this revaluation, sub articles (2) and (3) shall apply. (3ter) Sub articles (2) and (3) shall not apply where, further to a decision of the board of directors or board of management, within a contribution other than in cash assets other than the securities or money market instruments referred to in sub articles (3bis) to (3quater) are contributed that have already been subject to a fair value assessment by a company auditor and the following conditions are fulfilled:

a) the fair value is determined on a date no more than six months before the actual date of the completion of the contribution,

b) the valuation has been performed in accordance with valuation standards and principles generally accepted in Luxembourg and applicable to the type of assets to be contributed.

Where new circumstances could significantly change the fair value of the asset on the actual date of its contribution, a revaluation shall be carried out at the initiative and under the responsibility of the board of directors or the board of management. For the purposes of this revaluation, subarticles (2) and (3) shall apply. In the absence of such revaluation, one or more shareholders collectively holding at least 5% of the company’s subscribed capital on the date of the decision to increase the capital may request a valuation by a company auditor, in which case subarticles (2) and (3) shall apply. This or these shareholder(s) may submit such a request up until the actual date of the contribution, provided that, on the date of the request, the shareholder(s) in question still hold(s) at least 5% of the company’s subscribed capital, as was the case on the date the decision to increase the capital was taken.

(3quater) Subarticles (2) and (3) shall not apply where, further to a decision of the board of directors or the board of management, the contribution other than in cash consists of assets other than securities or money market instruments referred to in subarticle (3bis) whose fair value is based, for each individual asset, on the statutory accounts for the preceding financial year, provided they have been audited in accordance with Directive 2006/43/EC of the European Parliament and of the Council of 17 May 2006 on statutory audits of annual accounts and consolidated accounts. The second and third paragraphs of subarticle (3ter) shall apply mutatis mutandis. (3quinquies) Where a contribution other than in cash, as referred to in subarticles (3bis) to (3quater), is made without a report by a company auditor, as referred to in subarticles (2) and (3), a statement shall be published in accordance with article 9 within one month from the actual date of the contribution, containing the following information:

a) a description of the contribution other than in cash at issue;

b) its value, the basis for the valuation and, where appropriate, the valuation method;

c) a certificate stating whether the values arrived at correspond at least to the number, the nominal value failing which the accounting par of and, where appropriate, the share premium on the shares to be issued in consideration for that contribution;

d) a statement that no new qualifying circumstances have occurred with regard to the original valuation. The statement shall also indicate the nominal value of the shares failing which the number of shares issued in consideration for each contribution other than in cash, as well as the identity of the contributor. (3sexies) Where a contribution other than in cash is proposed to be made without a report by a company auditor as referred to in subarticles (2) and (3) in the context of a capital increase further to subarticles (2) and (3) of article 32, an announcement indicating the date on which the decision to increase the capital was taken and the information listed in subarticle (3quinquies) shall be published in accordance with article 9 before the contribution other than in cash consisting of an asset becomes effective. In this case, the statement referred to in subarticle (3quinquies), first paragraph, shall be limited to a certificate that no new qualifying circumstances have occurred since the aforementioned announcement was published.

(4) Subarticles (2) and (3) shall not apply where 90% of the nominal or accounting par value of all shares are issued in return for contributions other than in cash made by one or more entities and the following conditions are met:

a) with regard to the receiving company, the natural or legal persons referred to in article 27 have agreed to waive the expert’s report;

b) proof of this waiver is annexed to the deed;

c) the contributing entities have reserves that by law or pursuant to their articles of association may not be distributed and are at least equal to the nominal value failing which the accounting nominal value of the shares issued in consideration for the contributions other than in cash;

d) the contributing entities guarantee, up to the amount indicated in point c), the debts of the receiving company arising between the date of the issue of the shares in consideration for the contributions other than in cash and one year from publication of the company’s financial statements for the financial year during which the contributions were made. Any transfer of these shares is prohibited within this period;

e) the guarantee referred to in point d) must be laid down in an annex to the deed provided for by article 27;

f) the contributing entities shall place the amount indicated in point c) in a reserve that may not be distributed until three years after publication of the receiving company’s financial statements for the financial year during which the contributions were made or, where applicable, such later date on which all claims relating to the guarantee referred to in point d) submitted during that time have been settled.

Article 26-2

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), supplemented by the Act of 8 March 1989 (Official Gazette A14 of 17/03/1989 p. 176), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295))

(1) The acquisition by a company within two years following its incorporation of any asset belonging to a natural or legal person which signed the deed of incorporation, or on whose behalf the deed of incorporation was signed, for a consideration of at least onetenth of the subscribed capital shall be subject to verification and publication in the manner provided for by article 26-1 and approval by the general meeting of shareholders. The approved company auditor shall be appointed by the board of directors or the board of management, as appropriate.

(2) Subarticle 1 shall not apply to acquisitions made in the normal course of the company’s business or to acquisitions made at the initiative or under the supervision of an administrative or judicial authority or to stock exchange acquisitions.

Article 26-3

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864)) The subscribed capital may consist solely of assets that can be valued in monetary terms. However, these assets may not include an undertaking to perform work or supply services.

Article 26-4

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864)) Without prejudice to the provisions on the reduction of subscribed capital, shareholders may not be released from their obligation to pay up their contributions.

Article 26-5

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864))

(1) Shares may not be issued for an amount lower than their nominal value failing which their accounting nominal value.

(2) However, professionals entrusted with placing shares may, with the company’s consent, pay less than the total value of the shares they subscribe during such a transaction.

(3) The minimum amount to be paid by such subscribers shall be fixed by grand ducal regulations.

Article 27

(amended by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006p. 2684), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295), the Act of 6 April 2013 (Official Gazette A71 of 15/04/2013 p. 890)) The deed of incorporation shall indicate:

1) the identity of the natural or legal person(s) signing the deed or in whose name the deed is signed;

2) the corporate form and company name;

3) the address of the registered office;

4) the corporate purpose,

5) the amount of subscribed capital and, where applicable, authorised capital;

6) the amount of initially paid-up subscribed capital;

7) the classes of shares, where several classes exist, and the rights attaching to each class, the number of shares subscribed and, in the case of authorised capital, the shares to be issued of each class and the rights attaching to each class, as well as:

– the nominal value of the shares or the number of shares for which no nominal value is specified;

– any special share transfer restrictions;

8) whether the shares are in registered, bearer or dematerialised form and any provision supplementary to or derogating from law;

9) particulars of each contribution not made in Kind1 , the conditions under which the contribution is made, the name of the contributor and the conclusions of the accredited company auditor’s report as provided for by article 26-1;

10) any special benefits conferred at the time of incorporation on any person who participated in the incorporation and the reasons for such benefits;

11) if applicable, the number of securities not representing expressed capital, as well as the rights attaching thereto, in particular voting rights at general meetings;

12) insofar as not provided for by law, rules determining the number of and method of appointing members of the corporate organs responsible for representing the company to third parties and for the administration, management, supervision or audit of the company and the allocation of powers among st these organs;

13) the term for which the company is incorporated;

14) the, at least approximate, amount of costs, expenses, fees and disbursements of whatsoever form, payable by the company or chargeable to it by reason of its incorporation.

Article 28

(amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864)) The company may be constituted by means of one or more notarial deeds in which all the shareholders appear either in person or through holders of notarised or private powers of attorney.

The parties executing these deeds shall be deemed founders of the company. However, if the deeds designate as founder one or more shareholders who together hold at least one third of the company’s capital, the other parties who merely subscribe to shares in cash and are not directly or indirectly granted any special benefit shall be regarded as subscribers only.

If payments are made pursuant to article 26 prior to the execution of any deed of incorporation, proof thereof may be provided in the form of a private receipt to be drawn up in duplicate. There is an error in the Article 27 (9) because of the law of 18 December 2009. We should read contribution other than cash instead of other than kind.

Article 29

(amended by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), the Act of 10 July 2005 (Official Gazette A98 of 12/07/2005 p. 1748))

(1) The company may also be formed by means of subscriptions.

(2) The deed of incorporation shall be drawn up in advance in the form of a notarial deed and published in draft form. The parties to that instrument shall be deemed founders of the company.

(3) […]

(4) They shall contain a notice calling the subscribers to a meeting to be held within three months for the purpose of the final incorporation of the company.

(5) […]

(6) […]

Article 30

(supplemented by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864))

(1) On the scheduled date, the founder(s) shall present to the meeting, which shall be held before a notary public, proof that the conditions laid down in article 26 have been satisfied, together with supporting documents.

(2) If a majority of the subscribers present in person or represented by the holder(s) of notarised or private powers of attorney, not being the founder(s), have no objection to the incorporation of the company, the founder(s) shall declare the company definitively incorporated.

(3) If the announced capital has not been subscribed in full, the company may nevertheless be incorporated with capital corresponding to the subscriptions received, provided the deed published in accordance with article 9 allows for this possibility.

(4) The notarised minutes of the meeting of subscribers, which shall contain a list of the subscribers and details of the payments made, shall definitively incorporate the company.

Article 31

(replaced by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864))

(1) The founders shall be jointly and severally liable to all interested parties for the following, notwithstanding any provisions to the contrary:

1) any portion of the capital which has not been validly subscribed as well as any difference between the minimum capital provided for by article 26 and the amount of the subscriptions; they shall be deemed to subscribe to the difference by operation of law;

2) paying up in full up to one quarter of the subscribed shares, as well as paying up within a period of five years those shares issued in return for contributions other than in cash; they shall also be jointly and severally liable for the paying up in full that portion of the capital to which they are deemed to subscribe pursuant to the preceding paragraph;

3) making good any loss which is an immediate and direct result of either the invalidity of the company or omissions or errors in the particulars required by articles 27 and 29 in the deed or draft deed of incorporation and in the subscriptions.

(2) Any person who has made a commitment for a third party mentioned by name in the deed of incorporation, either acting as an agent or giving a covenant, shall be deemed personally bound if that individual did not have a valid authorization to do so or if the covenant is not ratified within two months’ time. The founders shall be jointly and severally liable for any such commitments.

Article 31-1

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864)) The provisions on the incorporation of public limited liability companies shall apply to the conversion of an entity in another form into a public limited liability company.

Article 31-2

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295)) In the event of the conversion of a European company (SE) into a public limited liability company in accordance with article 3, the following procedure shall be followed:

(1) The management organ of the European company (SE) shall draw up draft terms of conversion and a report explaining and justifying the legal and economic aspects of the conversion and indicating the implications for shareholders and employees of adopting the form of a public limited liability company.

(2) The draft terms of conversion shall be published in accordance with article 9 at least one month before the general meeting scheduled to vote on them.

(3) Before the general meeting referred to in subarticle (4), one or more accredited company auditors appointed by the management organ shall certify that the company has assets at least equivalent to its capital.

(4) The general meeting of the European company (SE) approves the draft terms of conversion, together with the articles of association of the public limited liability company. The decision of the general meeting shall be taken in accordance with the quorum and majority requirements to amend the articles of association.

Article 31-3

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), amended by the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295))

In the event of the conversion of a public limited liability company into a European company (SE) in accordance with article 3, the following procedure shall be followed:

(1) The management organ of the public limited liability company shall draw up draft terms of conversion and a report explaining and justifying the legal and economic aspects of the conversion and indicating the implications of adopting the form of a European company (SE) for the shareholders and employees.

(2) The draft terms of conversion shall be published in accordance with article 9 at least one month before the general meeting scheduled to vote on them.

(3) Prior to the general meeting referred to in subarticle 4, one or more accredited company auditors appointed by the management organ certifies that the company has net assets at least equal to its share capital plus reserves that may not be distributed by law or pursuant to its articles of association.

(4) The general meeting of the public limited liability company approves the draft terms of conversion together with the articles of association of the European company (SE). The general meeting’s decision shall be taken in accordance with the quorum and majority required to amend the articles of association.

(5) The rights and obligations of the company to be transformed regarding terms and conditionsof employment arising from national law, practice and individual employment contracts or employment relationships existing on the registration date are transferred to the SE upon registration.

(6) The registered office may not be transferred from one member State to another, in accordance with articles 101-1 to 101-17, at the same time as the conversion.

Article 32

(replaced by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) Any capital increase is decided on by the general meeting under the conditions required to amend the articles of association.

(2) The deed of incorporation may nonetheless authorise the board of directors or board of management to increase the capital, on one or more occasions, up to a predetermined amount.

(3) The general meeting may also grant such authorisation by means of an amendment to the articles of association.

(4) The rights attaching to the new shares are defined in the articles of association.

(5) The authorisation shall be valid for only five years from publication of the deed of incorporation or the amendment to the articles of association. It may be renewed on one or more occasions by the general meeting deliberating in accordance with the requirements to amend the articles of association, for a period which may not exceed five years per renewal.

Article 32-1

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), amended by the Act of 8 March 1989 (Official Gazette A14 of 17/03/1989 p. 176), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295))

(1) The formalities and conditions laid down for the incorporation of companies shall apply to capital increases by means of new contributions, subject to the following provisions.

(2) The members of the board of directors or the board of management, as appropriate, shall be jointly and severally liable for the obligations of the founders under article 31.

(3) If the proposed capital increase is not entirely subscribed, the capital shall be increased by the value of the subscriptions received, provided the terms of issue expressly provided for this possibility.

(4) The capital increase shall be recorded in a notarial instrument, prepared at the request of the board of directors or the board of management, as appropriate, upon the presentation of documents substantiating the subscriptions and payments, in the case of a capital increase by way of subscription or pursuant to the authorisation provided for by article 32. The notarial deed must be drawn up within one month from the end of the subscription period or within three months from the start of that period.

(5) For contributions other than in cash, the shares must be paid up in full within five years from the date of the decision to increase the capital. A report shall be drawn up by an accredited company auditor in accordance with article 26-1; the accredited company auditor shall be appointed by the board of directors or the board of management, as appropriate. The accredited company auditor’s report shall be lodged in accordance with article 9 (1).

Article 32-2

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864)) Where a share premium is provided for, the amount thereof must be paid up in full.

Article 32-3

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816))

(1) Shares to be subscribed in cash shall be offered on a preferential basis to shareholders in proportion to their shareholdings.

(2) The articles of association may provide that subarticle (1) shall not apply to shares with different rights to participate in distributions or share in liquidation proceeds. The articles of association may also provide that, where the subscribed capital of a company with several classes of shares is increased by means of the issue of new shares of only one class, the preferential right of the shareholders of the other classes may not be exercised until the shareholders of the class in which the new shares are issued have exercised their right.

(3) Subscription right may be exercised during a period determined by the board of directors or the board of management, as appropriate, which may not be less than thirty days from the start of the subscription announced by means of a notice determining the subscription period and published in the Official Gazette C, Digest of Companies and Associations and in two newspapers published in Luxembourg. However, where all the shares are in registered form, the shareholders may be notified by recorded delivery letter.

(4) Subscription right shall be negotiable throughout the entire subscription period and no transfer restrictions may be imposed on this negotiability other than those applicable to the shares to which the right relates.

(5) The articles of association may not cancel or restrict preference right. They may however authorise the board of directors or the board of management, as appropriate, to cancel or restrict these rights in relation to a capital increase within the limits of the authorised capital in accordance with article 32. Such authorisation shall not be valid for a period longer than that provided for by article 32(5).

The general meeting called to deliberate under the conditions required to amend the articles of association on a capital increase or authorisation to increase the capital in accordance with article 32(1) may restrict or cancel preferential subscription rights or authorise the board of directors or the board of management, as appropriate, to do so. Any such proposal shall be expressly mentioned in the notice calling the meeting. A detailed justification must be set out in a report prepared by the board of directors or board of management, as appropriate, and presented to the meeting, covering in particular the proposed issue price.

(6) There is no exclusion of the preferential subscription right within the meaning of subarticle (5) where, pursuant to the decision to increase the subscribed capital, the shares are issued to banks or other financial institutions with a view to being offered to the company’s shareholders in accordance with subarticles (1) and (3).

(7) Subscription rights that have not been exercised at the close of the subscription period shall be publicly sold by the company on the Luxembourg Stock Exchange; the sale proceeds after the deduction of expenses shall be kept at the disposal of shareholders for a period of five years. Any unclaimed balance shall vest in the company.

Article 32-4

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864)) Articles 32, 32-1 and 32-3 apply to the issue of convertible bonds and bonds with subscription rights but not to the conversion of such securities or to the exercise of subscription rights, to which article 32-2 shall nevertheless apply.

Article 33

(amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), repealed by the Act of 10 July 2005 (Official Gazette A98 of 12/07/2005 p. 1748))

Article 34

(amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), repealed by the Act of 10 July 2005 (Official Gazette A98 of 12/07/2005 p. 1748))

Article 35

(repealed by the Act of 10 July 2005 (Official Gazette A98 of 12/07/2005 p. 1748))

Article 36

(supplemented by the Act of 18 September 1933 (Official Gazette A48 of 2 October 1933 p. 749), repealed by the Act of 10 July 2005 (Official Gazette A98 of 12/07/2005 p. 1748))

3. Shares and share transfers (articles 37 to 49bis)

Article 37

(supplemented by the Act of 8 August 1985 (Official Gazette A49 of 28/08/1985 p. 931), amended by the Act of 21 December 2006 (Official GazetteA228 of 27/12/2006 p. 4070), the Act of 6 April 2013 (Official Gazette A71 of 15/04/2013 p. 890)) The capital of public limited liability companies shall be divided into shares of equal value, with or without reference to value. In addition to shares representing capital, beneficiary securities or certificates may be created. The articles of association shall specify the rights attaching thereto. Beneficiary securities or certificates, howsoever named, shall be subject to the provisions of article 26-1.

The shares and certificates shall be in registered, bearer or dematerialised form. Fractional shares may be issued, an appropriate number thereof conferring the same rights as a share. Shares and fractional shares shall bear a serial number, unless they are in paperless form.

Article 38

If there are several owners of a share or fractional share, the company shall be entitled to suspend exercise of the rights attaching thereto until a single person is designated as the owner vis-à-vis the company.

Article 39

(amended by the Act of 6 April 2013 (Official Gazette A71 of 15/04/2013 p. 890)) A register of registered shares shall be maintained at the company’s registered office, where any shareholder may examine it. The register shall include:

– the precise name of each shareholder and the number of shares or fractional shares held by each;

– the payments made on the shares;

– the share transfers and dates thereof or the conversion of shares into bearer or dematerialised form, if the articles of association allow for this possibility.

Article 40

(amended by the Act of 6 April 2013 (Official Gazette A71 of 15/04/2013 p. 890)) Title to registered shares shall be established by means of an entry in the register required by the preceding article. The company shall, at the request of a person entered in the register, issue a certificate relating to the securities registered in that person's name. Share transfers shall be carried out by means of a declaration in the aforementioned register, dated and signed by the transferor and the transferee or by their duly authorised representatives, and in accordance with the rules on the assignment of claims laid down in article 1690 of the Civil Code. The company may accept and enter in the register a transfer evidenced by correspondence or other documents recording the agreement between the transferor and the transferee.

Subject to any provisions of the articles of association to the contrary, transfer upon death shall be validly evidenced to the company, provided no objection is made, upon production of a death certificate, the certificate of entry and an affidavit made before a justice of the peace or notary public.

Article 41

(amended by the Act of 20 June 1930 (Official Gazette A31 of 5/07/1930 p. 617), the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), supplemented by the Act of 6 April 2013 (Official Gazette A71 of 15/04/2013 p. 890)) Bearer shares shall be signed by two directors or members of the board of management, as appropriate, or, if the company has only one director or the board of management has only one member, by the sole director or member. Unless the articles of association provide otherwise, the signature may be handwritten, printed, or stamped. However, one of the signatures may be affixed by a person authorised to do so by the board of directors or the board of management, as appropriate, in which case it must be handwritten.

A certified copy of the instrument enacting this delegation of authority to such person, not being a member of the board of directors or board of management, as appropriate, shall be lodged beforehand in accordance with article 9 (1) and (2). The share shall indicate:

– the date of the company’s deed of incorporation and the publication date thereof;

– the company’s capital, the number and type of each class of shares and the nominal value of the securities or the ownership interest they represent;

– a brief description of the contributions made to the company and the conditions under which they are made;

– any special benefits conferred on the founders;

– the term for which the company is incorporated;

– the date and time of the annual general meeting and the municipality in which it is held.

The foregoing paragraph shall not apply to collective share certificates (warrants) that take the form of global bearer certificates deposited in a securities settlement system. The number of shares represented by such certificates must be fixed or determinable.

Article 42

(replaced by the Act of 28 July 2014 (Official Gazette A161 of 14 August 2014 p.2484))

(1) Bearer shares are to be deposited with a custodian appointed by the board of directors or board of management, as the case may be, fulfilling the conditions set down in subarticle (2).

(2) The custodian may not be a shareholder of the issuing company. Only the following parties acting in the course of business and established in Luxembourg may be appointed as custodians:

a) credit institutions;

b) wealth managers;

c) distributors of units in UCITS;

d) specialist financial sector professionals licensed as a Family Office, as company domiciliation agents, as professionals providing corporate incorporation or management services, as register-holding agents or as professional custodians of financial instruments;

e) Appeal Court lawyers entered on List I and European lawyers practicing under their original professional title and entered on List IV of the table of lawyers referred to in article 8, subarticle (3), of the amended Advocacy Profession Act of 10 August 1991;

f) notaries public;

g) company auditors and accredited company auditors;

h) chartered accountants.

(3) The custodian maintains a register of bearer shares in Luxembourg; this register contains:

a) the precise designation of each shareholder and a stipulation of the number of shares or fractional shares;

b) the date of the deposit;

c) transfers, along with their date or conversion of the shares into registered securities. Each holder of bearer shares is entitled to inspect only those entries that concern him.

(4) The custodian holds the deposited shares in accordance with subarticle (1) on behalf of the shareholder that is their owner. Ownership of the bearer share is recorded by a register entry. On the written demand of the holder of the bearer share, a certificate confirming all entries concerning him is issued to him by the custodian. Any transfer is rendering binding by a confirmation of transfer entered in the said register by the custodian. The custodian may to this end accept any document or notification confirming the passing of ownership between the transferor and the transferee. Unless otherwise provided in the articles of association, notification of a transfer mortis causa is validly made to the custodian, and provided no objection is raised, upon production of the death certificate, the certificate of entry and an affidavit executed before a justice of the peace or a notary public.

(5) The rights attaching to bearer shares may only be exercised if the bearer share is deposited with the custodian and all the details required under subarticle (3) are entered in the register.

(6) The custodian may not alienate bearer shares except in the following cases in which he must deliver up the bearer shares:

a) to his successor as custodian, in the event that he should cease trading;

b) to the company in the event of conversion of those bearer shares into registered securities, in the event of redemption by the company of its own shares according to articles 49-2 and 49-3 and in the event of reduction of the share capital according to article 69-1.

(7) The liability of the custodian as deriving from its obligations flowing from subarticles (3), (4) and (6) is determined according to the same rules as the liability of the directors or members of the board of management, as the case may be.

Article 42bis

(inserted by the Act of 6 April 2013 (Official Gazette A71 of 15/04/2013 p. 890)) A dematerialised share shall be given material form by being recorded in a securities account in the account holder’s name with a settlement house, a central book runner, book runner or foreign book runner. Disposals occur by transfer from one account to another.

Article 43

(amended by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1804), the Act of 6 April 2013 (Official Gazette A71 of 15/04/2013 p. 890)) Share transfers shall be valid only after definitive incorporation of the company and after a quarter of the amount of the share has been paid up. Shares shall be in registered form until they are paid up in full.

The owners of shares or securities in bearer form may, at any time, request that they be converted, at their expense, into shares or securities in registered form or, where the articles of association so allow, dematerialised form. In the latter case, the costs shall be borne by the person indicated in the Dematerialised Securities Act.

The holders of shares or securities in registered form may at any time request their conversion into bearer form, unless the articles of association expressly disallow this possibility. Where the articles so allow, the holders of shares or securities in registered form may request their conversion into dematerialised form. The costs shall be borne by the person indicated in the Dematerialised Securities Act. The holders of shares or securities in dematerialised form may, at any time, request their conversion, at their expense, into registered form, unless the articles of association provide that dematerialised form is mandatory.

Article 44

(repealed by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 874), reintroduced by the Act of 8 August 1985 (Official Gazette A49 of 28/08/1985 p. 931), amended by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792))

(1) Non-voting shares representing capital may be issued only on the following conditions:

1) they do not represent more than half the share capital;

2) they must, in the event of a distribution of profits, confer the right to a preferential dividend corresponding to a percentage of their nominal value or accounting par value as determined in the articles of association, without prejudice to any right which may be granted to them to share in surplus profits;

3) they must confer a preferential right to the reimbursement of capital, without prejudice to any right which may be granted to them to share in liquidation proceeds.

(2) If the condition set down in point (1) is not or ceases to be met, the shares in question shall by operation of law and notwithstanding any provision to the contrary carry the voting rights provided for by articles 67 and 67-1, without prejudice to the right conferred on them by article 46. The same shall apply to any shares to which the rights provided for in points (2) and (3) are not, or are no longer, granted.

Article 45

(repealed by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 874), reintroduced by the Act of 8 August 1985 (Official GazetteA49 of 28/08/1985 p. 931), amended by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) Preference non-voting shares may be issued:

– upon the incorporation of the company if the articles of association so allow;

– further to a capital increase;

– upon the conversion of common shares into non-voting preference shares.

In the latter two cases, the general meeting shall deliberate in accordance with the rules laid down in article 67-1(1) and (2).

(2) The general meeting shall determine the maximum number of such shares to be issued, within the limits laid down in article 44(1).

(3) If non-voting shares are created upon the conversion of common shares that have already been issued or if this option is provided for by the articles of association, in the event of conversion of non-voting preference shares into common shares, the general meeting shall determine, within the limits laid down in article 44(1), the maximum number of shares to be converted and the conditions for conversion.

The offer of conversion shall be made at the same time to all shareholders in proportion to their shareholdings. Subscription right may be exercised within a period to be determined by the board of directors or the board of management, as appropriate, which may not be less than thirty days from the start of the subscription period, announced in a notice fixing the subscription period and published in the Official Gazette C, Digest of Companies and Associations and in two newspapers published in Luxembourg. However, where all shares are in registered form, the shareholders may be notified by recorded delivery letter.

Article 46

(amended by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 874), appealed and reinstated by the Act of 8 August 1985 (Official Gazette A49 of 28/08/1985 p. 931))

(1) The holders of shares issued pursuant to article 44 shall be entitled to vote at every general meeting called to deal with the following matters:

– the issue of new shares with preferential rights;

– determination of the cumulative preferential dividend on non-voting shares;

– the conversion of non-voting preference shares into common shares;

– reduction of the company’s capital;

– any change to the corporate purpose;

– the issuance of convertible bonds;

– dissolution of the company prior to expiry of the term for which it was incorporated;

– conversion of the company into a another legal form.

(2) They shall have the same voting rights as the holders of common shares at all meetings where, despite the existence of profits available for that purpose, the preferential and cumulative dividend is not paid in full, howsoever arising, for a period of two successive financial years, until such time as all dividends have been received in full.

(3) Save where they are granted voting rights, non-voting preference shares shall not be taken into account to determine whether the quorum and majority requirements for general meetings are satisfied.

Article 47

(repealed by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 874), reinstated by the Act of 8 August 1985 (Official Gazette A49 of 28/08/1985 p. 931)) The notices, reports and documents that, pursuant to the provisions of this law, are sent to or served on the company’s shareholders shall also be sent to or served on the holders of non-voting preference shares within the periods laid down for that purpose.

Article 48

(amended by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 874), the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816)) A statement regarding the company’s capital shall be published once each year, following on from the balance sheet. It shall include:

– the number of subscribed shares;

– the paid-up amounts;

– a list of shareholders who have not yet fully paid up their shares, specifying the outstanding balance.

As regards changes to the shareholders, publication of this list shall have the same effect as a publication made in accordance with article 11bis. In the event of a capital increase, the statement shall additionally indicate the portion of the capital that has not yet been subscribed.

Article 49

Notwithstanding any provision to the contrary, shareholders shall be liable for the total amount of their shares. However, a valid transfer of shares shall release them, towards the company, from the obligation to make any contribution for liabilities arising after the transfer and, towards third parties, from the obligation to make any contribution for liabilities arising after publication of the transfer.

Each transferor shall have a right of recourse, jointly and severally, against the initial transferee and subsequent transferees.

4. - [...] (heading amended by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), repealed by the Act of 12 March 1998 (Official Gazette A24 of 31/03/1998 p. 356))

Article 49-1

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) A company may not subscribe to its own shares.

(2) If the shares in a company have been subscribed by a person acting in his own name but on behalf of the company, the subscriber shall be deemed to have subscribed the shares on his own behalf.

(3) The natural or legal persons as well as the executing parties referred to in article 29, number 2, or, in the case of an increase in the subscribed capital, the members of the board of directors or board of management, as appropriate, shall be required to pay up any shares subscribed in breach of this article. However, said persons may be released from this obligation on proving that no fault is attributable to them personally.

Article 49-2

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) Without prejudice to the principle of equal treatment of all shareholders in the same situation and the Market Abuse Act, the company may only acquire its own shares either itself or through a person acting in his own name but on behalf of the company subject to the following conditions:

1) The authorisation to acquire shares is granted by the general meeting, which shall determine the terms and conditions for the proposed acquisitions, in particular the maximum number of shares to be acquired, the period for which the authorisation is valid, which may not exceed five years, and, in the case of an acquisition for consideration, the maximum and minimum amount of the consideration. The board of directors or the board of management shall ensure that, upon each authorised acquisition, the conditions referred to in points 2) and 3) are met.

2) The acquisitions, including shares previously acquired by the company and held in its portfolio as well as shares acquired by a person acting in his own name but on behalf of the company, must not cause the net asset value to fall below the amount set forth in subarticles (1) and (2) of article 72-1.

3) Only fully paid-up shares may be acquired.

(2) Where acquisition of the company’s own shares is necessary in order to prevent serious, imminent harm to the company, the condition set out in subarticle (1) 1°) shall not apply.

In that case, the board of directors or the board of management, as appropriate, must inform the next general meeting of the reasons for and purpose of the acquisition, the number and nominal value failing which the accounting par value of the shares acquired, the percentage of the subscribed capital they represent and the consideration paid.

(3) Likewise, nor shall the condition set out under subarticle (1) 1°) apply in the case of shares acquired by the company itself or a person acting in his own name but on behalf of the company for the purpose of distribution to the company’s personnel. The distribution of any such shares must occur within twelve months from the date of their acquisition.

Article 49-3

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864))

(1) Article 49-2 shall not apply to:

a) shares acquired pursuant to a decision to reduce the capital or under the circumstances referred to in article 49-8;

b) shares acquired as a result of a transfer of the totality of the assets of a company;

c) fully paid-up shares acquired for no consideration or by banks and other financial institutions pursuant to a purchase commission agreement;

d) shares acquired further to a statutory obligation or a court order for the purpose of protecting minority shareholders, in particular in the event of a merger or division of the company, a change in the company’s purpose or form, the transfer abroad of its registered office or the introduction of share transfer restrictions;

e) shares acquired from a shareholder by dint of failure to pay them up;

f) fully paid-up shares acquired pursuant to a distribution by court order for the payment of a debt owed to the company by the shareholder;

g) fully paid-up shares issued by a closed-end investment company, as defined in article 72-3, acquired at the request of investors by this company or a a person acting in his own name but on behalf of the company. These acquisitions may not have the effect of causing the net asset value to fall below the total subscribed capital plus any reserves that may not be distributed by law.

(2) Shares acquired in the circumstances indicated in points (b) to (f) of subarticle (1) must nevertheless be disposed of within a maximum period of three years from their acquisition, unless the nominal value failing which the accounting par value of the shares so acquired, including those which the company acquired through a person acting in his own name but on behalf of the company, does not exceed 10% of the subscribed capital.

(3) If the shares are not disposed of within the period indicated in subarticle (2), they must be cancelled. The subscribed capital may be reduced by a corresponding amount. Such reduction shall be mandatory where the acquisitions of shares to be cancelled results in the net asset value falling below the amount referred to in article 72-1.

Article 49-4

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864)) Any shares acquired in breach of articles 49-2 and 49-3(1)(a) must be disposed of within a period of one year from their acquisition. If they are not disposed of within that period, article 49-3(3) shall apply.

Article 49-5

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864))

(1) Where the company is allowed to acquire its own shares in accordance with articles 49-2 and 49-3, the holding of such shares shall be subject to the following conditions:

a) among the rights attaching to shares, the voting rights regarding own shares shall be suspended;

b) if the shares are included in the assets shown on the balance sheet, a nondistributable reserve in the same amount shall be created on the liabilities side.

(2) Where a company has acquired its own shares in accordance with articles 49-2 and 49-3, the management report must indicate:

a) the reasons for such acquisitions made during the financial year;

b) the number and nominal value failing which the accounting par value of the shares so acquired and disposed of during the financial year and the percentage of the subscribed capital they represent;

c) in the event of an acquisition or disposal for consideration, the value of the consideration for the shares;

d) the number and nominal value failing which the accounting par value of all shares acquired and held in the company’s portfolio as well as the percentage of the subscribed capital they represent.

Article 49-6

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), amended by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) A company may not, directly or indirectly, advance funds, grant loans or provide security with a view to the acquisition of its shares by a third party except under the following circumstances:

a) The transactions take place under the responsibility of the board of directors or the board of management at arm’s length, especially with regard to the interest received by the company and the security provided to the company in consideration for the loans and advances referred to above. The financial situation of the third party or, in the event of multiparty transactions, of each counter party must have been duly investigated.

b) The transactions are submitted by the board of directors or the board of management to the general meeting of shareholders for prior approval, deliberating in accordance with the requirements to amend the articles of association. The board of directors or the board of management shall present a written report to the general meeting indicating the reasons for the transaction, the benefit of the transaction for the company, the conditions under which the transaction is entered into, the risks involved in the transaction for the company’s liquidity and solvency, and the price at which the third party is deemed to acquire the shares. This report shall be lodged with the register of commerce and companies in accordance with article 9(1) and published in the Official Gazette pursuant to article 9(3), third paragraph.

c) The total financial assistance granted to third parties may not cause the company’s net asset value to fall below the amount specified in subarticles (1) and (2) of article 72-1, including taking into account any reduction in the net asset value that may have occurred through the acquisition by the company or on its behalf of own shares in accordance with article 49-2(1). The company shall constitute a non distributable reserve on the liabilities side of its balance sheet in an amount equal to the total financial assistance.

d) Where, by means of financial assistance from a company, a third party acquires that company’s shares within the meaning of article 49-2(1) or subscribes toshares issued in the context of a capital increase, the acquisition or subscription shall be made at a fair price.

(2) Subarticle (1) shall not apply to transactions entered into by banks and other financial institutions in the normal course of their business or to transactions effected with a view to the acquisition of shares by or for the company’s employees. However, such transactions may not cause the company’s net asset value to fall below its total subscribed capital plus those reserves that may not be distributed by law or pursuant to the company’s articles of association.

(3) Subarticle (1) shall not apply to transactions carried out with a view to acquiring shares as described in article 49-3(1)g).

Article 49-6bis

(inserted by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268)) In cases where members of the board of directors or the board of management of a company that is party to a transaction referred to in article 49-6(1) or of a parent company, or the parent company itself, or persons acting in their own name but on behalf of members of the board of directors or board of management or on behalf of the company, are party to a transaction referred to in article 49-6, the statutory auditor(s) or company auditors shall prepare a special report on the transaction for the general meeting of shareholders that votes on that report.

Article 49-7

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864))

(1) Acceptance of a pledge of the company’s own shares as security, either by the company itself or by a person acting in his own name but on behalf of the company, shall be treated as an acquisition for the purpose of articles 49-2, 49-3(1), 49-5 and 49-6.

(2) Subarticle (1) shall not apply to transactions entered into by banks and other financial institutions in the normal course of their business.

Article 49-8

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), amended by the Act of 23 March 2007 (Official Gazette A46 of 31/03/2007 p. 816)) By way of a derogation from the foregoing provisions, the issue of redeemable shares shall be authorised provided that their redemption is subject to the following conditions:

1) redemption is authorised by the articles of association before subscription of the redeemable shares;

2) the shares are fully paid up;

3) the terms and conditions for redemption are laid down in the articles of association;

4) redemption can only occur using sums available for distribution in accordance with article 72-1 or the proceeds of a new issue made with a view to effecting such redemption;

5) an amount equal to the nominal value failing which the accounting par value of all redeemed shares is placed in a reserve that cannot be distributed to the shareholders except in the event of a reduction in the subscribed capital; the reserve may only be used to increase the subscribed capital through the incorporation of reserves;

6) point 5) shall not apply to redemption using the proceeds from a new issue effected with a view to carrying out such redemption;

7) where provision is made for the payment of a premium to shareholders upon redemption, the premium may be paid only from amounts that are available for distribution in accordance with article 72-1(1).

8) notice of redemption shall be published in accordance with article 9.

Article 49bis

(inserted by the Act of 12 March 1998 (Official Gazette A24 of 31/0371998 p. 356), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) a) The subscription, acquisition or holding of shares in a public limited liability company by another company within the meaning of article 1 of Directive 68/151/EEC in which the public limited liability company directly or indirectly holds a majority of the voting rights or over which it can directly or indirectly exert a dominant influence shall be regarded as being done by the public limited liability company itself.

b) Point (a) shall also apply where the other company is governed by the laws of a third country and has a legal form comparable to those listed in article 1 of Directive 68/151/EEC.

(2) However, where it is only indirectly that the public limited liability company holds a majority of the voting rights or can exert a dominant influence, subarticle (1) does not apply but in this case, the voting rights attaching to the shares in the public limited liability company held by the other company shall be suspended.

(3) For the purposes of this article:

a) a public limited liability company is deemed to be able to exert a dominant influence if it:

– has the right to appoint or remove a majority of the members of the administrative, management or supervisory organ and is also a shareholder or member of the other company, or

– is a shareholder or member of the other entity and exercises sole control over a majority of the voting rights of the other company’s shareholders or members pursuant to an agreement concluded with the shareholders or members of that company.

b)  a public limited liability company is deemed to indirectly hold voting rights where such voting rights are held by a company that takes one of the legal forms referred to in paragraph (1), in which the public limited liability company directly holds a majority of the voting rights;

– a public limited liability company is deemed to be able to indirectly exert a dominant influence over another company where the public limited liability company directly holds a majority of the voting rights in a company that takes one of the legal forms referred to in paragraph (1) and which

– has the right to appoint or remove a majority of the members of the administrative, management or supervisory organ and is, at the same time, a shareholder or member of the other company, or

– is a shareholder or member of the other company and has sole control of the majority of the voting rights of the other company’s shareholders or members pursuant to an agreement concluded with the shareholders or members of that company.

c) a public limited liability company is deemed to hold voting rights where, pursuant to its articles of association, the law or an agreement, it is entitled to exercise the voting rights attaching to the company’s shares and can in fact exercise them.

(4) Subarticle (1) shall not apply where

a) the subscription, acquisition or holding of shares is effected on behalf of a person other than the person subscribing, acquiring or holding the shares and who is neither the public limited liability company referred to in subarticle (1) nor a company a majority of whose voting rights the public limited liability company holds directly or indirectly or over which it can directly or indirectly exert a dominant influence;

b) the subscription, acquisition or holding of shares in the public limited liability company is effected by the other company referred to in subarticle (1) in its capacity and in the context of its activities as a professional dealer in securities, provided it is a member of a stock exchange situated or operating in a member State of the European Communities or is licensed or regulated by an authority of a member State of the European Communities with power to regulate professional dealers in securities, which, for the purposes this article, may include credit institutions.

(5) Subarticle (1) shall not apply where the holding of shares in the public limited liability company by the other company referred to in subarticle (1) results from an acquisition made before the relationship between the two companies fulfilled the criteria laid down in subarticle (1).

However, the voting rights attaching to these shares shall be suspended and the shares shall be taken into account in order to determine whether the condition laid down in article 49-2(1)(2°) is fulfilled.

(6) Subarticles (2) and (3) of article 49-3 and article 49-4 shall not apply where shares in a public limited liability company are acquired by the company referred to in subarticle (1) provided:

a) the voting rights attaching to the shares in the public limited liability company held by the other company are suspended; and

b) the members of the management body of the public limited liability company are required to buy back from the other company the shares referred to in article 49- 3(2) and (3) and article 49-4 at the price at which the other company acquired them; this sanction shall not apply if and only if the members can prove that the public limited liability company played no role whatsoever in subscription or acquisition of the shares in question.

4. Management and supervision of public limited liability companies and European companies (SE) (articles 50 to 66) Sub-§1. Board of directors (articles 50 to 60bis) (heading inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

Article 50

Public limited liability companies are managed by representatives appointed for a specific period of time who need not be members, who may be removed from office and may or may not receive a salary.

Article 51

(amended by the Act of 8 March 1989 (Official Gazette A14 of 17/03/1989 p. 176), replaced by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) There must be at least three directors. However, where a company is formed by a sole shareholder or where, at a general meeting, it is found that the company has only one shareholder, the board of directors may have just one member until the next ordinary general meeting following the finding of the existence of more than one shareholder.

In a European company (SE), the number of directors or the rules for determining the number of directors shall be set down in the articles of association. Nonetheless, the board of directors shall consist of at least three members where employee participation in the European company (SE) is organised in accordance with Directive 2001/86/EC. Directors shall be appointed for a term fixed by the general meeting of shareholders; the first directors may, however, be appointed in the company’s deed of incorporation. This provision shall apply to European company (SE) without prejudice, as the case may be to any employee participation arrangements laid down pursuant to Directive 2001/86/EC. The term of office of directors may not exceed six years, and they may be removed by the general meeting of shareholders at any time. Where a directorship filled by the general meeting of shareholders becomes vacant, the remaining directors thus appointed may temporarily fill the vacancy unless the articles of association provide otherwise. In this case, the next general meeting of shareholders elects a definitive incumbent.

Article 51bis

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Where a legal person is appointed director, it shall designate a permanent representative to perform its duties in its name and on its behalf. This representative shall be subject to the same requirements and bear the same civil liability as if he were performing the duties in his own name and on his own behalf, without prejudice to the joint and several liability of the legal person represented. The legal person may recall its representative only if a replacement is designated at the same time. The appointment and termination of the office of a permanent representative shall be subject to the same publication requirements as if he were performing the duties in his own name and on his own behalf.

Article 52

Unless the deed of incorporation provides otherwise, directors may be re-elected; in the event of a vacancy prior to the end of a director’s term of office, the newly appointed director shall serve out the remainder of the outgoing director’s term.

Article 53

(amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), supplemented by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The board of directors shall have the power to perform any acts necessary or useful to achieve the corporate purpose, with the exception of those reserved by law or the articles of association to the general meeting. The articles of association of a European company (SE) shall list the categories of transactions for which an express decision of the board of directors is necessary. The board of directors shall represent the company to third parties and in legal proceedings, as plaintiff or defendant. Process served on behalf of or on the company shall be valid if done in the name of the company alone.

Any limitations on the powers conferred on the board of directors by the preceding paragraphs arising either from the articles of association or from a decision of the competent corporate organs shall not be binding as against third parties, even if published. However, the articles of association may authorise one or more directors to represent the company, jointly or alone, for the purposes of any instrument or in legal proceedings. A clause to that effect shall be binding against third parties, subject to fulfillment of the conditions laid down in article 9.

Where, in a European company (SE), a valid delegation of authority has been conferred and the person so authorised performs an act that falls within the limits of his authority but also within a category of transactions for which, pursuant to the articles of association of the European company (SE), an express decision of the board of directors is required, the act in question shall be binding on the company, without prejudice to the possibility to claim damages, where appropriate.

Article 54

(repealed by the Act of 8 March 1989 (Official Gazette A14 if 17/03/1989 p. 176)) […] Article 55

(repealed by the Act of 8 March 1989 (Official Gazette A14 of 17/03/1989 p. 176)) […]

Article 56

(repealed by the Act of 8 March 1989 (Official Gazette A14 of 17/03/1989 p. 176)) […]

Article 57

(supplemented by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Any director having an interest in a transaction submitted for approval to the board of directors that conflicts with the company’s interests shall be obliged to advise the board thereof and to ensure that this disclosure is mentioned in the minutes of the meeting. In this case, the director may not take part in the deliberations. At the next general meeting, before any other resolution is put to a vote, any transactions in which any director might have had a conflict of interests with the company shall be specially reported.

By way of a derogation from the first and second paragraphs, where a company has only one director, transactions between the company and the director who has interests conflicting with the interests of the company shall only be minuted. The provisions of the preceding paragraphs shall not apply where the decisions of the board of directors or the director relate to ordinary business transactions entered into under normal conditions.

Article 58

Directors shall not incur any personal obligation owing to the company’s commitments.

Article 59

Directors shall be liable to the company in accordance with general rules of law for performance of the duties entrusted to them and for mismanagement. They shall be jointly and severally liable to the company and any third parties for damages resulting from breaches of this act or the company’s articles of association. They shall be released from such liability if they were not party to the breach, provided no misconduct can be attributed to them and they reported the breach at the first general meeting after learning thereof.

Article 60

(amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Day-to-day management of the company and power to represent the company with respect to that management may be delegated to one or more directors, managers or other agents, who need not be members, acting alone or jointly. The appointment, removal and powers of the daily managers shall be governed by the articles of association or a decision of the competent corporate organ; however, no restrictions on their powers to represent the company in matters of day-to-day management shall be binding as against third parties, even if published.

A clause delegating day-to-day management to one or more persons acting alone or jointly shall be binding as against third parties under the conditions set out in article 9. If daily managerial authority is delegated to a member of the board of directors, the board must annually inform the ordinary general meeting of the salary, emoluments and other benefits granted to the delegate. The liability of delegates entrusted with day-to-day management shall be determined by the general rules of agency.

Article 60bis

(inserted by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586)) A company shall be bound by acts engaged in by its board of directors, those directors authorised to represent the company in accordance with article 53, fourth paragraph, and the delegate entrusted with day-to-day management, even if such acts are ultra vires, unless it is proved that the third party in question knew of the ultra vires nature of the act or could not have been unaware thereof in view of the circumstances, it being noted that mere publication of the articles of association does not constitute such proof.

Sub §2. Board of management and supervisory board (articles 60bis1 to 60bis19) (title inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)

Article 60bis-1

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) The articles of association of a public limited liability company may provide that the company is subject to the provisions of this subarticle. In that case, the company shall be subject to all provisions applicable to public limited liability companies, with the exception of those set out in articles 50 to 60bis.

(2) A decision to insert this provision into the articles of association or to remove it therefrom may be made during the term for which the company is incorporated.

A. The board of management (articles 60bis2 to 60bis10)

Article 60bis-2

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) A public limited liability company shall be governed by a board of management. The number of members or rules to determine the number of members shall be set out in the articles of association in the case of a European company (SE). For a public limited liability company, these provisions shall be set out in the articles of association failing which they shall be set down by the supervisory board.

(2) In a public limited liability company that is a sole proprietorship or in a public limited liability company with capital of less than 500,000 euros, a single individual may carry out the duties conferred on the board of management.

(3) The board of management shall perform its duties under the supervision of the supervisory board.

Article 60bis-3

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The members of the board of management shall be appointed by the supervisory board. The articles of association may nevertheless confer authority on the general meeting to appoint members of the board of management. In this case, only the general meeting has authority to do so.

Article 60bis-4

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Where a legal entity is appointed to the board of management, it shall designate a permanent representative to perform its duties in its name and on its behalf. This representative shall be subject to the same requirements and incur the same civil liability as if he were performing the duties in his own name and on his own behalf, without prejudice to the joint and several liability of the legal entity represented. The legal entity may remove its representative only if a replacement is appointed at the same time. The appointment and termination of the office of a permanent representative shall be subject to the same publication requirements as if the permanent representative were performing the duties in his own name and on his own behalf.

Article 60bis-5

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The members of the board of management may be removed by the supervisory board and, if the articles of association so provide, by the general meeting of shareholders.

Article 60bis-6

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) The members of the board of management shall be appointed for a renewable term specified in the articles of association, which may not exceed six years.

(2) Where a vacancy arises on the board of management, the remaining members may temporarily fill the position unless the articles of association provide otherwise.

(3) In that case, the supervisory board or the general meeting of shareholders, as appropriate, shall appoint a definitive incumbent at its next meeting. The newly appointed member of the board of management shall serve out the term of office of the outgoing member.

Article 60bis-7

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) The board of management shall have authority to perform all acts useful or necessary to achieving the corporate purpose, with the exception of those specifically reserved by law or the articles of association to the supervisory board and the general meeting.

(2) The articles of association of a European company (SE) shall list the categories of transactions for which the supervisory board’s authorisation is required. Where a transaction requires the authorisation of the supervisory board and this authorisation is refused, the board of management may submit the matter to the general meeting of shareholders.

(3) The board of management shall represent the company in dealings with third parties and in legal procedures, as plaintiff or defendant. Process served on behalf of or on the company shall be valid if made in the name of the company alone.

(4) Restrictions on the aforementioned powers of the board of management based on the articles of association or the decisions of competent corporate organs shall not be binding as against third parties, even if published. However, the articles of association may authorise one or more members of the board of management to represent the company, alone or jointly, for the purposes of certain documents or in legal proceedings. Such a clause is binding as against third parties under the conditions set out in article 9.

Where, in a European company (SE), a valid delegation of authority has been conferred and the person so authorised performs an act that falls within the limits of his authority but also within a category of transactions for which, pursuant to the articles of association of the European company (SE), an express authorisation of the board of management by the supervisory board is required, the act in question shall be binding on the company, without prejudice to the possibility to claim damages, where appropriate.

Article 60bis-8

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Daily management of the company and representation of the company, regarding such management, may be delegated to one or more members of the board of management, managers, directors and other agents, who need not be members of the company, with the exception of members of the supervisory board, acting alone or jointly. The appointment, removal and powers of the daily managers shall be governed by the articles of association or by a decision of the competent organ, it being noted that any restrictions on representation powers for the purposes of daily management shall not be binding as against third parties, even if published. A clause delegating daily management of the company to one or more persons, acting alone or jointly, shall be binding as against third parties in accordance with the conditions set out in article 9.

If daily managerial authority is delegated to a member of the board, the board of management must report annually to the ordinary general meeting of shareholders on all salary, emoluments and other benefits granted to the daily manager. The liability of the persons responsible for daily management of the company shall be determined in accordance with the general rules of agency.

Article 60bis-9

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08//2006 p. 2684)) A company shall be bound by acts carried out by its board of management, members of the board of management authorised to represent the company in accordance with article 60bis-7(4) or the daily manager, even if such acts are ultra vires, unless the company can prove that the third party in question knew of the ultra vires nature of the acts or could not have been unaware of this fact given the circumstances; it being noted that mere publication of the articles of association is not sufficient proof of such knowledge.

Article 60bis-10

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2691)) Members of the board of management shall be liable to the company in accordance with general rules of law for the performance of their duties and any mismanagement. Members of the board of management shall be jointly liable to the company or to third parties for any damages resulting from breaches of the provisions of this act or the company’s articles of association. They may be released from liability for breaches in which they did not participate provided they have not committed any fault and they disclose the breach at the first general meeting of shareholders after becoming aware of it. The authorisation granted by the supervisory board in accordance with article 60bis-7(2) shall not release the members of the board of management from their liability.

B. The supervisory board (articles 60bis11 to 60bis16)

Article 60bis-11

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) The supervisory board shall exercise permanent oversight of the company’s management by the board of management, but without the power to interfere in this management.

(2) The supervisory board shall grant or refuse the authorisations required in accordance with article 60bis-7(2).

Article 60bis-12

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) The supervisory board shall have an unlimited right to inspect all transactions of the company; it may review, without removing, the books of account, correspondence, minutes and, in general, all records of the company.

(2) The board of management shall report at least quarterly to the supervisory board on the company’s business and foreseeable prospects.

(3) In addition, the board of management shall inform the supervisory board on a timely basis of all information regarding events that could significantly affect the company.

(4) The supervisory board may request the board of management to provide all information necessary for its supervisory activities in accordance with article 60bis-11.

(5) The supervisory board may perform, or appoint others to perform, the verifications necessary for the performance of its duties.

Article 60bis-13

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Each year, the supervisory board shall receive from the board of management the documents detailed in article 72, at the time scheduled to submit them to the statutory auditors, and shall present to the general meeting its comments on the board of management’s report as well as on the financial statements for the financial year.

Article 60bis-14

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2691)) The provisions of article 51, 51bis and 52 shall apply to the supervisory board.

Article 60bis-15

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) The supervisory board may grant special powers of attorney to one or more of its members for the performance of one or more specific tasks.

(2) The supervisory board may decide to create sub-committees that carry out their activities subject to its responsibility and determine the composition and powers of these subcommittees, provided the delegation of authority does not result in the subcommittee exercising powers reserved by law or the articles of association to the supervisory board or reduce or limit the powers of the board of management.

Article 60bis-16

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Members of the supervisory board shall be liable to the company in accordance with ordinary rules of law for the performance of their duties and any misconduct committed in their supervision responsibilities.

Members of the supervisory board shall be jointly liable to the company or to third parties for any damages resulting from breaches of provisions of this act or the articles of association. They may be released from liability for breaches in which they did not participate, only provided no misconduct may be attributed to them and they report the breach to the next general meeting of shareholders after becoming aware of it.

C. Provisions applicable to both the board of management and the supervisory board (articles 60bis17 to 60bis19)

Article 60bis-17

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) No person may simultaneously be a member of both the board of management and the supervisory board.

(2) In the event of a vacancy on the board of management, the supervisory board may, however, appoint one of its members to fill the vacancy. During this time, the duties of the person concerned as a member of the supervisory board shall be suspended.

Article 60bis-18

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) A member of the board of management or supervisory board who has an interest in a transaction subject to the approval of the board of management or supervisory board that is contrary to the company’s interests shall inform the board of management or supervisory board thereof and ensure that a statement to this effect is included in the minutes of the meeting. This member may not take part in such deliberation.

At the next general meeting, before voting on any other resolutions, a report shall be presented on the transactions in which the interests of a member of the board of management or supervisory board conflicted with those of the company. By way of a derogation from the first and second paragraphs, where the board of management or supervisory board has only one member, only transactions between the company and its member of the board of management or supervisory board that are not in the interests of the company need be minuted.

(2) Where the transaction referred to in the preceding subarticle is contrary to the interests of the company and a member of the board of management, the authorisation of the supervisory board shall also be required.

(3) The provisions of the preceding subarticles shall not apply where the proposed decisions relate to ordinary business transactions carried out under normal conditions.

Article 60bis-19

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The members of the board of management and supervisory board may be remunerated. The terms and level of remuneration paid to members of the board of management shall be determined by the supervisory board. The terms and level of remuneration paid to members of the supervisory board shall be set by the articles of association or by the general meeting of shareholders.

Sub §3. Audit by the statutory auditors (articles 61 to 62)

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

Article 61

(amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Audit of the company must be entrusted to one or more statutory auditors, who need not be members. They shall be appointed by the general meeting of shareholders. Unless the deed of incorporation provides otherwise, statutory auditors may be re-elected. Their term of office may not exceed six years and they may be removed at any time by the general meeting.

The general meeting shall determine the number of statutory auditors and their fees. If, as a result of death or otherwise, the number of statutory auditors falls to fewer than half the number initially appointed, the board of directors or the board of management, as appropriate, must immediately call a general meeting of shareholders in order to fill the vacancies.

Article 62

(amended by the Act of 11 August 1996 (Official Gazette A53 of 20/08/1996 p. 1660), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The statutory auditors shall have unlimited power to audit and oversee all transactions of the company. They may inspect, without removing, the books, correspondence, minutes and, in general, all the records of the company.

Every half-year the board of directors or board of management, as appropriate, shall submit to them a report on the company’s assets and liabilities. The statutory auditors shall report to the general meeting of shareholders on the fulfilment of their duties, making such recommendations as they deem appropriate and informing the meeting of the methods used to audit the statements of assets and liabilities. Their auditors’ liability, insofar as it derives from their audit and oversight duties, shall be determined based on the same rules as apply to directors or members of the board of management.

The statutory auditors may be assisted by an expert for the purpose of verifying the company’s books and accounts. The expert must be approved by the company. Failing such approval, the president of the local court sitting in commercial matters shall appoint the expert on a petition by the statutory auditors that is served on the company. The president shall hear the parties in chambers and issue a ruling on the appointment of the expert in open court. This decision need not be served on the company and is not subject to appeal.

Sub §4. Common provisions applicable to management organs, the supervisory board and statutory auditors (articles 63 to 66) (inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

Article 63

(amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) A general meeting of shareholders that decides to bring an action, as provided for by articles 59, 60bis-10, 60bis-16 or 62, third paragraph, against directors, members of the board of management, members of the supervisory board or statutory auditors may entrust one or more agents with execution of this decision.

Article 64

(amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) The directors, the members of the management board and the supervisory board, and the statutory auditors shall form collective bodies which deliberate in accordance with the provisions set out in the articles of association or, in the absence thereof, the ordinary rules of law on deliberative assemblies.

(2) The board of directors, the board of management and the supervisory board shall elect a chairperson from among their members. If half the board of directors or supervisory board of a European company (SE) has been appointed by employees, only a member appointed by the general meeting of shareholders may be elected chairperson.

(3) The board of directors or the supervisory board of a European company (SE) shall meet at least quarterly at the intervals set out in the articles of association to deliberate on the business and prospects of the European company (SE).

(4) Each member of the board of directors, board of management or supervisory board may take due cognisance of any information communicated to this organ.

(5) The chair shall call meetings of the supervisory board. The chair shall call a meeting if requested to do so by at least two supervisory board members or by the board of management. The supervisory board shall meet at the intervals set down in the articles of association. The supervisory board may invite members of the board of management to attend its meetings, but in a consultative role only.

Article 64bis

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 P.2684))

(1) Unless otherwise provided in the articles of association and without prejudice to special provisions of law, the internal rules on quorums and decision-making for the board of directors, supervisory board and board of management of a company are as follows:

a) quorum: at least half the members must be present or represented.

b) decision-making: decisions are taken by the majority of members present or represented.

(2) In the absence of any relevant provision in the articles of association, the chairperson of each organ has a casting vote in the event of a tied ballot.

(3) Unless otherwise provided in the articles of association, the by-laws may provide that directors or members of the board of management participating at the board meeting by video conference or means of telecommunication allowing them to be identified shall be deemed present for the purposes of calculating the quorum and majority. These means must satisfy the technical characteristics guaranteeing actual participation in the board meeting, whose proceedings must be transmitted without interruption. A meeting held using such remote means of communication is deemed to have the registered office of the company as its venue.

Article 65

The articles of association may provide that the directors and statutory auditors in meeting shall form the general board; they shall determine its remit.

Article 66

(repealed by the Act of 8 March 1989 (Official Gazette A14 of 17/03/1989 p. 176), reintroduced by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The directors, members of the board of management and the supervisory board, plus any person called to attend meetings of those bodies, are under an obligation, even after they shall have left office, not to divulge the information that they possess regarding the public limited liability company and whose disclosure might be liable to harm the company’s interests, with the exclusion of those cases in which such disclosure is required or allowed by a statutory or regulatory provision applying to public limited liability companies or in the public interest.

5. General meetings (articles 67 to 71)

Article 67

(amended by the Act of 13 April 1922 (Official Gazette A24 of 15/04/1922 p. 349), the Act of 15 January 1927 (Official Gazette A3 of 22/01/1927 p. 17), replaced by the Act of 20 June 1930 (Official Gazette A31 of 05/07/1930 p. 617), amended by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), replaced by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816))

(1) The shareholders in general meeting have the most extensive powers to make or ratify the acts that concern the company. Where the company has a single member, he exercises the powers devolved on the general meeting. The general meeting of a European company (SE) decides on matters for which specific competence is conferred on it by:

a) this act in accordance with Regulation (EC) no. 2157/2001 of the Council of 8 October 2001 on the Statute for a European company (SE),

b) the provisions of Luxembourg law enacted in transposition of Directive 2001/86/EC, where the European company (SE) has its statutory registered office in the Grand Duchy of Luxembourg. Moreover, the general meeting of a European company (SE) decides on matters for which competence is conferred on the general meeting:

– of a public limited liability company falling under Luxembourg law where the European company (SE) has its statutory registered office in the Grand Duchy of Luxembourg

– by its articles of association in accordance with that same law.

(2) The articles of association set down the manner in which the general meeting deliberates and the formalities necessary to be admitted to meetings. Failing provisions, appointments are made and decisions taken according to the ordinary rules for deliberative assemblies; the minutes are signed by the members of the panel and by such shareholders who so request; copies to be given to third parties are certified true to the original in cases in which the meeting’s deliberations have been set down in an authentic deed, by the notary public with which the deed in question is lodged, otherwise by the person designated to this effect by the articles of association, failing whom by the chairman of the board of directors or, as the case may be, of the board of management or the person deputising therefor, and these persons shall be accountable for damage that might result from any inaccuracy in their certificate. If the company has a single member, his decisions are set down in minutes.

(3) Notwithstanding any provision to the contrary, any shareholder is entitled, albeit provided he complies with the rules contained in the articles of association, to cast votes either himself or by proxy. If the articles of association so provide, shareholders taking part in a general meeting by video conference or by means of communication that allow them to be identified are deemed present for the purposes of calculating the quorum and majority. These means must fulfil characteristics that guarantee effective participation in the meeting, whose deliberations are re-transmitted in a continuous manner.

(3bis)The articles of association may authorise any shareholder to vote by correspondence using a form whose details are set down in the articles of association. Forms on which neither the manner in which a vote is cast nor an abstention is noted are void.

For the purpose of calculating the quorum, account is taken of the forms that have been received by the company prior to the general meeting within the deadlines set down in the articles of association.

(4) Notwithstanding any provision to the contrary in the articles of association, any shareholder may take part in the deliberations with as many votes as he possesses shares, without limit.

(5) The board of directors or the board of management, as the case may be, is entitled to adjourn any meeting forthwith for four weeks. It must do so on the request of shareholders representing one-fifth or more of the company’s share capital. Such adjournments, which apply equally to general meetings called to amend the articles of association, cancel any decision taken. The second meeting has the right to take final decisions provided that, where the articles of association are amended, the attendance conditions required by article 67-1 are fulfilled.

(6) If an ordinary general meeting whose adjournment is pronounced has been called for the same day as a general meeting called to amend the articles of association and the latter meeting is not quorate, the adjournment of the first meeting may be put back to a date that is sufficiently distant for it to be possible to call both meetings on the same day, whereby the adjournment may not exceed six weeks in length.

(7) Exercise of voting rights attaching to shares on which payments have not been made will be suspended until such time as such calls as have been duly made and are exigible shall have been paid.

Article 67-1

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) Unless otherwise provided in the articles of association, an extraordinary general meeting deliberating as provided below may amend all and any of the provisions of the articles of association. However, a change in the company’s nationality and increases in the shareholders’ commitments may only be decided on with the unanimous agreement of the members and bond holders.

(2) The general meeting can only validly deliberate if at least one-half of the share capital is represented and the agenda sets out the proposed amendments to the articles, plus, as the case may be, the text of any that affect the corporate purpose or form of the company. If the first of these conditions is not fulfilled, a new meeting may be called under the terms of the articles of association by means of intimations published twice at an interval of at least fifteen days and fifteen days before the meeting in the Official Gazette C, Digest of Companies and Associations and in two Luxembourg newspapers.

This notice must set forth the agenda, specifying the date and result of the preceding meeting. The second meeting deliberates validly regardless of what portion of the share capital is represented. At both meetings, in order for resolutions to be valid, they must be approved by at least two-thirds of the votes cast. The votes cast do not include those attaching to shares held by shareholders who have not taken part in the ballot or have abstained or cast a blank or void vote.

(3) Except in the case of a merger, division or transactions equated thereto by articles 284 and 308, amendments affecting the corporate purpose or form of the company must be approved by the bond holders in general meeting. This meeting will only validly deliberate if at least one-half of the securities in circulation are represented and the agenda specifies the proposed amendments. If the first of these conditions is not met, a new meeting may be called according to the conditions set down in subarticle (2).

At the second meeting, those bond holders who are not present and not represented will be deemed present and as voting the proposals put forth by the board of directors or board of management, as the case may be. However, it shall be required, failing which all resolutions will be void, that:

a) the notice calling the meeting reproduce the agenda of the first meeting, stating the date and result thereof;

b) it specify the proposals put forth by the board of directors or board of management, as the case may be, on each of the items figuring on that agenda, stating the proposed amendments;

c) it contain a notice to the bond holders advising that failure by them to be present at the general meeting shall be deemed support of the proposals put forth by the board of directors or board of management, as the case may be. At both meetings, resolutions are validly adopted if voted in favour of by two-thirds of the votes. The votes cast shall not include those attaching to bonds for which the bond holder has not taken part in the ballot, has abstained or has cast a blank or void vote.

Article 68

Where there exist two or more classes of shares and the deliberations of the general meeting are susceptible of amending their respective rights, the deliberations must, in order to be valid, fulfil the presence and majority requirements within each class as required by the preceding article.

Article 69

(replaced by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), amended by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792))

(1) The general meeting may resolve to reduce the subscribed share capital under the conditions set down for amendment of the articles of association. The notice calling the meeting must state the purpose of the reduction and the manner in which it is to be effected.

(2) If the reduction is to be effected by means of a repayment to the shareholders or by relieving them from having to pay up their shares, creditors whose claims precede the date of publication in the Official Gazette C, Digest of Companies and Associations of the minutes of the deliberations may, within 30 days of such publication, petition for the constitution of security to the judge presiding in the division of the local court sitting in commercial matters and as under the urgent applications procedure. The president may refuse this petition if the creditor is in possession of adequate guarantees or if same are not necessary in view of the company’s assets.

(3) No payment may be made nor any relief granted in favour of the shareholders until the creditors shall have obtained satisfaction or the judge presiding in the division of the local court sitting in commercial matters and as under the urgent applications procedure has ruled that there are no grounds to grant their petition.

(4) The provisions of subarticles (2) and (3) do not apply in the case of a reduction of subscribed capital whose purpose is to offset losses sustained and not liable to be absorbed by other equity or to incorporate sums in a reserve, provided that, pursuant to that operation, the amount of that reserve shall not exceed 10% of the reduced subscribed capital. Except in the case of a capital reduction under the conditions set down in subarticles (2) and (3), it may not be distributed to the shareholders, or relieve the shareholders of their obligation to make their capital contributions. It may only be used to offset losses sustained or to increase the subscribed capital by the incorporation of reserves.

(5) Where the reduction in capital results in its being reduced to an amount less than the statutory minimum, the meeting must simultaneously resolve either to increase the share capital accordingly or to change the company’s legal form.

Article 69-1

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864))

(1) The articles of association may provide that, by decision of the general meeting subject to publication in accordance with article 9, all or part of the profits and reserves other than those whose distribution is prohibited by law or the articles of association can be applied to amortisation of the share capital by means of a repayment at par of all the shares or part thereof designated by drawing lots, without the expressed capital being reduced.

(2) The reimbursed securities are cancelled and replaced by profit-participation shares to which the same rights attach as to the cancelled securities, with the exclusion of the right to repayment of capital contribution and the right to participate in distribution of a first dividend allotted to the non-amortised shares.

Article 69-2

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816))

(1) In the event that the subscribed share capital is reduced by retiring shares acquired by the company itself or by a person acting in his own name but on behalf of that company, the retirement must be decided on by the general meeting.

(2) Article 69, subarticles (2) and (3), applies unless what are concerned are fully paid-up shares acquired free of charge or using sums distributable in accordance with article 72-1; in that case, a sum equal to the nominal value or, failing a par value, the accounting par of all the retired shares must be incorporated into a reserve, which may not be distributed to the shareholders except in the event of a reduction in the subscribed share capital; it may only be used to offset sustained losses or increase the share capital by the incorporation of reserves.

(3) In cases falling under subarticle (1), the general meeting’s decision is subject to a separate ballot for whichever class of shares to which the rights attaching are prejudiced by the operation. Moreover, the provisions of articles 31, subarticle (1), and 69, subarticle (4), shall not apply.

Article 70

(amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Each year, at least one general meeting shall be held in the municipality, on the date and at the time stipulated in the articles of association. The meeting must be held within six months after the closing of the financial year and the first general meeting may take place within eighteen months of incorporation.

The board of directors or the board of management, as the case may be, as well as the supervisory board and the statutory auditors are entitled to call the general meeting. They require to call it such that it shall be held within a period of one month where shareholders representing one-tenth of the share capital of the company so demand by written request specifying the agenda.

If, further to a request made by shareholders according to the second paragraph, the general meeting is not held within the prescribed period, the meeting may be called by a representative designated by the president of the local court sitting in commercial matters and as under the urgent applications procedure, on a petition by one or more shareholders who, together, hold the aforementioned fraction of the company’s share capital. One or more shareholders who together possess at least ten per cent of the subscribed share capital may require the incorporation of one or more new items on the agenda of any general meeting. Such request is to be sent to the registered office by recorded delivery letter at least five days before the meeting is held.

Notices calling all general meetings shall contain the agenda and be served by means of intimations published twice at an eight-day interval and eight days before the meeting in the Official Gazette C, Digest and Companies Associations and in a Luxembourg newspaper. Letters will be sent out to the registered shareholders eight days before the meeting, but no evidence shall be required that this formality has been complied with. If all the shares are registered shares, notices of meetings may be served only by means of recorded delivery letters.

Article 71

(amended by the Act of 20 June 1930 (Official Gazette A31 of 05/07/1930 p. 617), the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), repealed by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), reinserted and replaced by the Act of 6 April 2013 (Official Gazette A71 of 15/04/2013 p. 890)) Bearers of dematerialised shares or securities may attend general meetings and exercise their rights only if they hold said dematerialised shares or securities no later than 24:00 hours Luxembourg time on the fourteenth day preceding the meeting.

6. Inventories and financial statements (articles 72 to 75) (heading supplemented by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

Article 72

(amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816)) Each year, the board of directors or board of management, as the case may be, must prepare an inventory setting forth the company’s movable and immovable assets and all debts owed to and by it, with an appendix summarising all its commitments together with the debts owed by the officers, directors, members of the board of management, as the case may be, members of the supervisory board and statutory auditors of the company.

The board of directors or board of management, as the case may be, prepares the financial statements, in which the necessary depreciation charges must be included. The balance sheet shall separately set out the fixed assets, the realisable assets and, on the liabilities side, the company’s debts to itself, the bonds, the debts subject to mortgages or liens and debts with no real securities.

Each year, an advance deduction is made from the net profits amounting to at least one twentieth, which is allotted to the constitution of a reserve; this advance deduction ceases to be compulsory once the reserve reaches one-tenth of the company’s share capital, but resumes whenever that one-tenth figure is drawn against.

The board of directors or board of management, as the case may be, shall one month prior to the ordinary general meeting submit the records along with a report on the company’s transactions to the statutory auditors, who must issue a report containing their proposals.

Article 72-1

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864))

(1) Except in the case of reductions in the subscribed share capital, no distribution may be made to the shareholders where, on the closing date of the preceding financial year, the net assets as shown in the financial statements are, or further to such distribution would be, less than the amount of the subscribed share capital plus those reserves whose distribution is proscribed by law or the articles of association.

(2) The subscribed share capital amount falling under (1) is reduced by the amount of uncalled subscribed share capital where that is not booked on the assets side of the balance sheet.

(3) No distribution may be made to the shareholders in an amount exceeding the amount of the profits from the previous completed accounting year plus retained profits and advance deductions from reserves available for that purpose and less carry-over losses and sums to be allotted to reserves according to law or the articles of association.

The term “distribution” as figuring in the foregoing provisions particularly encompasses the payment of dividends and interest relative to shares.

Article 72-2

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), amended by the Act of 8 March 1989 (Official Gazette A14 of 17/03/1989 p. 176), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295))

(1) No interim dividend may be paid unless the articles of association authorise the board of directors or board of management, as the case may be, to do so. Furthermore, any such payment is subject to the following conditions:

a) an accounting statement shall be prepared showing that the funds available for the distribution are sufficient;

b) the amount to be distributed may not exceed the amount of the profits earned since the end of the preceding financial period whose financial statements have been approved, plus retained profits and advance deductions on reserves available for that purpose and less carry-over losses and sums to be allotted to reserves pursuant to an obligation laid down by law or the articles of association;

c) the decision of the board of directors or board of management, as the case may be, to distribute an interim dividend may not be taken more than two months after the date on which the accounting statement referred to in (a) above was drawn down to; [...]

d) the statutory auditor or accredited company auditor verifies in his report to the board of directors or board of management, as the case may be, whether the conditions laid down above have been complied with.

(2) Where an interim dividend exceeds the amount of the dividend subsequently decided on by the general meeting, it will, to that extent, be deemed an advance to be set against the next following dividend.

Article 72-3

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864))

(1) Article 72-1, subarticle (1), does not apply to closed-end investment companies.

(2) Closed-end investment companies are deemed to be public limited liability companies:

– whose sole object is to invest their funds in varied transferrable securities, varied immovable assets or other assets with the sole purpose of spreading the investment risks and procuring benefit for their shareholders from the results of management of their assets; and

– that extend invitations to the general public for the placement of their own shares, on condition that:

a) they cause the terms “investment company” to figure in their deeds, announcements, publications, letters and other documents;

b) their total assets as shown in the financial statements on the closing date of the preceding financial year are not or do not, by dint of such distribution, become less than one-and-a-half times the total amount of the company’s debts towards its creditors as shown in the financial statements;

c) this is stated in a note in the financial statements.

Article 72-4

(inserted by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), amended by the Act of 30 July 2013 (Official Gazette A177 of 02/10/2013 p. 3384)) Any distribution made contrary to articles 72-1, 72-2 or 72-3 or article 72ter of the amended Act of 19 December 2002 on the commercial and companies register and the accounting and financial statements of undertakings must be repaid by those shareholders that have received same if the company proves that those shareholders knew that the distributions made in their favour were improper or, in the circumstances, they could not have been unaware thereof.

Article 73

(amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295)) Fifteen days before the general meeting, the shareholders may inspect the following at the company’s registered office:

1) the financial statements and the list of directors or members of the board of management and supervisory board, as well as the list of the statutory auditors or the accredited company auditor;

2) the list of public funds, shares, bonds and other corporate securities comprising the portfolio;

3) the list of shareholders that have not paid up their shares, stating the number of shares held by them and their registered address;

4) the management report by the board of directors or board of management, as the case may be, and the observations pertaining thereto made by the supervisory board;

5) the report by the statutory auditors or the accredited company auditor. The financial statements together with the report by the statutory auditors or accredited company auditor, the management report and the observations by the supervisory board are sent to each of the shareholders by name at the same time as the notice calling the meeting. Each shareholder is entitled to be given copies of the documents referred to in the preceding paragraph fifteen days before the meeting on production of his document of title; no charge shall be made in this respect.

Article 74

(amended by the Act of 20 June 1930 (Official Gazette A31 of 05/07/1930 p. 617), the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The general meeting hears the reports by the directors, the members of the board of management, as the case may be, and the statutory auditors, and discusses the financial statements.

Following approval of the financial statements, the general meeting makes a pronouncement by way of a special ballot on the quietus to be conferred on the directors, the members of the board of management and the supervisory board, as the case may be, as well as the statutory auditors. This quietus is only valid if the financial statements do not contain either any omission or any false specification dissimulating the company’s true situation and, regarding acts engaged in ultra vires, if they have been specially pointed out in the notice calling the meeting.

Article 75

(amended by the Act of 19 December 2002 (Official Gazette A149 of 31/12/2002 p. 3684), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2695)) The financial statements, preceded by mention of the date of publication of the company’s deeds of incorporation, must be published within a month of their approval at the company’s costs and through the offices of the directors or members of the board of management, as the case may be, according to the procedure laid down in article 9. Below the financial statements are published the surnames, first names, occupations and registered addresses of the directors, members of the board of management, as the case may be, and statutory auditors in office, together with a table showing the allocation and distribution of the net profits according to the decisions of the general meeting.

7. Certain particulars to be included in deeds (articles 76 to 78)

Article 76

(amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), the Act of 19 December 2002 (Official Gazette A149 of 31/12/2002 p. 3651), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) All deeds, invoices, announcements, publications, letters, order forms and other documents emanating from public limited liability companies and European companies (SE) must contain:

1) the company’s name;

2) the words “société anonyme” written out in letters or the abbreviation “SA” or, as the case may be, the abbreviation “SE”, reproduced in a legible fashion, placed immediately before or after the company’s name;

3) precise particulars of the registered office;

4) the words “Registre de commerce et des sociétés, Luxembourg” or the initials “R.C.S. Luxembourg” followed by the company’s registration number. If the documents specified above mention the company’s share capital, this mention must take account of the reduction it may have undergone according to the results of successive balance sheets and will state any part that has not yet been paid and, in the case of a capital increase, any part that has not yet been subscribed. Notice of any change in the registered office is published in the Official Gazette C, Digest of Companies and Associations, through the offices of the directors or members of the board of management, as the case may be.

Article 77

Any agent of a public limited liability company acting on its behalf in a deed relative to which the requirements of the preceding article are not fulfilled may, according to the circumstances, be declared personally liable for the commitments undertaken therein by the company. If the statement of share capital is exaggerated or if the portion not yet paid or subscribed is missing or inaccurate, third parties may claim from that agent, failing which the company, a sum sufficient to place them in the situation they would have been in had the stated share capital been the true share capital and had it been paid or subscribed in full or in the stated proportion.

Article 78

(amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) In all deeds engaging the company’s liability, the signature of the directors, members of the board of management, as the case may be, managing directors and other agents must be immediately preceded or followed by particulars of the capacity pursuant to which they act.

8. Issue of bonds (articles 79 to 98)

Article 79

No bonds of any kind may be issued before the company’s incorporation.

Article 80

(amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), repealed by the Act of 10 July 2005 (Official Gazette A98 of 12/07/2005 p. 1748)) […]

Article 81

(amended by the Act of 23 November 1972 Official Gazette A72 of 13/12/1972 p. 1586), repealed by the Act of 10 July 2005 (Official Gazette A98 of 12/07/2005 p. 1748)) […]

Article 82

(repealed by the Act of 10 July 2005 (Official Gazette A98 of 12/07/2005 p. 1748)) […]

Article 83

(supplemented par the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), repealed by the Act of 10 July 2005 (Official Gazette A98 of 12/07/2005 p. 1748)) […]

Article 84

(amended by the Act of 20 June 1930 (Official Gazette A31 of 05/07/1930 p. 617), the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), the Act of 10 July 2005 (Official Gazette A98 of 12/07/2005 p. 1748), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816), the Act of 6 April 2013 (Official Gazette A71 of 15/04/2013 p. 890), the Act of 28 July 2014 (Official Gazette A161 of 14 August 2014 p.2484) A register of registered bonds is kept at the company’s registered office. Bearer bonds are signed by two directors or members of the board of management, as the case may be, or, if the company has only one single director or one single member forming its board of management, by that person. Unless provided otherwise in the articles of association, the signature may be handwritten, printed or adhibited by means of a stamp. However, such a signature may be adhibited by a person appointed for that purpose by the board of directors or board of management, as the case may be. In that case, it must be handwritten.

A certified true copy of the deed conferring power on a person not forming part of the board of directors or board of management, as the case may be, shall be lodged beforehand in accordance with article 9, § 1 and 2. Collective bond certificates in the form of global bearer certificates lodged with a securities settlement system may be signed by one or more persons authorised by the issuing company. The number of securities represented by such certificates must be determined or determinable. The provisions of articles 40, 42bis and 43, third, fourth and fifth paragraphs, apply to bonds.

Article 85

Bond holders are entitled to take cognisance of documents lodged in conformity with Article 73. They may attend general meetings, but only with a consultative voice.

Article 86

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415)) Bond holders holding securities forming part of one and the same issue form an organised body in accordance with the following provisions.

Article 87

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295))

(1) One or more representatives of the body of bond holders may be designated by the company at the time of the issue or, during the term of the borrowing, by the general meeting of bond holders.

(2) If no representative has been appointed in the manner provided in the preceding paragraph, the judge presiding in the division of the local court sitting in commercial matters and as under the urgent applications procedure in the jurisdiction in which the company has its registered office may, in a case of urgency, on a petition by the company, any bond holder or interested third party, designate one or more representatives, whose powers he shall fix.

(3) The following may not be designated as representatives of the body of bond holders:

1) the debtor company;

2) companies owning one-tenth or more of the share capital of the debtor company or in which that company owns one-tenth or more of the share capital;

3) companies acting as guarantor for all or part of the debtor company’s commitments;

4) the members of the board of directors, board of management or supervisory board, the statutory auditors, accredited company auditors and servants of those companies.

(4) The general meeting of bond holders may recall the representatives of the body. They may also be recalled for just cause by the judge presiding in the division of the local court sitting in commercial matters and as under the urgent applications procedure in the jurisdiction in which the company has its registered office, on a petition by the company or any bond holder.

Article 88

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415))

(1) Where the representative or representatives of the body of bond holders is or are designated by the company at the time of the issue, he exercises or they exercise the powers listed below:

1) they carry out the decisions taken by the general meeting of bond holders;

2) they accept on behalf of the body of bond holders the securities intended to guarantee the company’s liability. They may grant full or partial release of mortgage register entries in the case of repayment or payment into their hands of the disposal price of the assets to be disencumbered, as well as in the case of full or partial repayment of the bonds;

3) they carry out conservatory acts to preserve the bond holders’ rights;

4) they attend operations in which bonds are drawn by lots and ensure due and proper execution of the amortisation plan and the payment of interest;

5) they represent the bond holders in any bankruptcy, moratorium, creditors’ arrangement to ward off bankruptcy, administration or other, similar procedures and declare all claims therein on behalf and in the interests of the bond holders and adduce evidence of the existence and amount of their claims by any means at law;

6) they may appear in court proceedings, as plaintiff or as defendant on behalf and in the interests of the bond holders represented, without it being necessary for them to be cited in the relevant cause.

(2) The bond holders in general meeting may, after a period of six months, restrict or extend the powers of the representatives of the body of bond holders designated by the company at the time of the issue.

(3) Where the representative or representatives of the body of bond holders is or are designated by the bond holders in general meeting during the term of the borrowing, the meeting is free to fix the representative’s or representatives’ powers as it sees fit.

Article 89

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415)) By derogation from article 88, first paragraph, the issuer may, at the time of the issue, designate one or more persons charged with special mandates on behalf of the body of bond holders, provided always that their powers may not exceed those provided in article 88.

Article 90

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415)) The liability of representatives of the body of bond holders is construed as being that of a salaried agent.

Article 91

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415)) The costs of calling and holding general meetings of bond holders and the costs of conservatory acts carried out by the representatives of the body are borne by the company, which is required to advance funds for that purpose. The emoluments of the representatives are borne by the company, which may apply to have them fixed to the judge presiding the local court sitting in commercial matters in the jurisdiction in which the company has its registered office.

Other costs and outlays decided on by the meeting or incurred by the representatives shall be borne by the bond holders without prejudice to the right of a court seized of a dispute to which the bond holders are party to conjoin them in the expenses of the proceedings. The meeting determines the manner in which they will be covered. It may decide that they will be advanced by the company but retained by it from the interest accruing in favour of the bond holders, in which event the amount of the advance may not exceed one-tenth of the net annual interest. In the event of a dispute as to the opportuneness or amount of the advance, the judge presiding the local court sitting in commercial matters in the jurisdiction in which the company has its registered office rules on the representatives’ petition once the parties have been heard or duly summonsed.

Article 92

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The representatives of the body of bond holders, the board of directors or board of management, as the case may be, as well as the statutory auditor or board of statutory auditors may call general meetings of bond holders. The representatives of the body, where an advance of costs has been made to them in accordance with article 91, and the other corporate bodies must do so within a period of one month where so requested by bond holders comprising one-twentieth of the bonds in circulation whose securities form part of one and the same issue.

Article 93

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415)) The meeting groups together the bond holders forming part of one and the same body. However, where a question is common to the bond holders belonging to two or more bodies, they are called to a single meeting.

Article 94

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415)) Notices of meetings are served according to the forms and deadlines set down in article 70.

Article 94-1

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415)) Notwithstanding any provision to the contrary, but in compliance with the conditions of the issue, all bond holders have the right to vote in person or by proxy. The voting right attaching to bonds is proportional to the portion of the amount of borrowing that they represent. Each bond confers one vote at least.

The members of the company’s corporate organs as well as any persons that might be authorised by the meeting itself may attend the meeting with a consultative voice. Meetings are chaired by the representatives of the body of bond holders if any have been designated. Parties who have complied with the statutory requirements and the conditions of the issue with a view to taking part in a meeting may, if their right is challenged, take part in the ballot on their admissibility. Proxies for such parties in possession of a written proxy have the same right.

The company must at the start of meetings provide the bond holders with a list of the bonds in circulation. The deliberation procedure is set down in the articles of association, the conditions of issue and the provisions of article 67.

Article 94-2

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295)) Meetings may:

1) appoint or recall representatives of the body according to the terms set down in article 87;

2) recall special agents as referred to in article 89;

3) decide on conservatory acts to be carried out in the common interest;

4) amend or cancel particular securities attributed to the bearers of bonds;

5) postpone one or more interest maturity dates, agree to a reduction in the rate of the interest or amend the conditions for its payment;

6) extend the amortisation period, suspend it and agree to changes to the conditions in which it is to take place;

7) agree to shares in the company being substituted for bonds;

8) agree to shares or bonds of other companies being substituted for bonds;

9) decide on constitution of a fund intended to ensure defence of the common interests;

10) decide on all other measures intended to ensure defence of the common interests of the bond holders or the exercise of their rights.

The decisions under 5,6,7 and 8 can only be taken if the share capital is entirely called. In these same cases and in that provided for in no. 4, the meeting may only rule having seen a statement verified and certified by the statutory auditors or accredited company auditors summarising the assets and liabilities situation of the company drawn down to a date which may not predate the decision by more than two months and accompanied by a report by the board of directors or board of management, as the case may be, justifying the proposed measures.

Where the substitution of shares for bonds entails an increase in the company’s share capital, it may not be of effect unless that increase is decided on by the shareholders in general meeting no later than three months after the decision by the general meeting of bond holders. Extracts of the decisions taken are published in accordance with article 11bis.

Article 94-3

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) Where a meeting is called upon to pronounce on the questions set down in nos. 1, 2 and 3 of article 94-2, the decisions are taken on a simple majority of the votes cast by the bearer of securities that are represented.

(2) In the other cases, meetings may only validly deliberate if their members represent at least one-half of the amount of the securities in circulation. If this condition is not met, a new meeting must be called and the new meeting deliberates validly regardless of what portion of the amount of securities in circulation is represented. The decisions are taken on a majority of two-thirds of the votes cast by the bearers of securities that are represented. The votes cast do not include those attaching to bonds for which the bond holder did not take part in the ballot or has abstained or cast a blank or void vote.

Article 94-4

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415)) Where the deliberations are such as to alter the respective rights of several bodies of bond holders, they are not valid unless adopted within each body according to the quorum and majority requirements set down in article 94-3.

Article 94-5

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415)) Where one or more representatives of the body of bond holders is or are designated according to article 87, the bond holders may no longer exercise their rights individually. Where one or more representatives of the body of bond holders is or are designated during the term of the borrowing, individual actions that have already been filed extinguish unless the representative or representatives of the body adopts or adopt them within six months of their designation. The bond holders retain the right to pursue enforcement of final judgments obtained before the designation of one or more representatives of the body of bond holders.

Article 94-6

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816))

(1) The company may constitute a mortgage as security for bonds issued or to be issued. The register entry is made in the ordinary form in favour of the body of bond holders or future bond holders under the following two restrictions:

1) the designation of the creditor is replaced by that of the securities representative of the guaranteed claim;

2) the provisions relative to choice of venue for service are not applicable.

3) The mortgage is ranked as of the date of the register entry, without regard to the time at which the bonds were issued.

(2) No renewal of the register entry is required throughout the term of the borrowing.

(3) The register entry is reduced or struck off once the company’s commitments have terminated or where the general meeting of bond holders give their consent.

Proceedings seeking removal from the register, expropriation of the encumbered real estate or reduction or deletion of a mortgage register entry are directed against the representatives of the body. If no representative has been designated by the general meeting of bond holders, the procedure laid down in the second paragraph of article 87 must be followed.

(4) The representatives of the body must within eight days of receipt consign the sums paid to them pursuant to the proceedings referred to in the preceding subarticle either with the consignment institution or, with the court’s authorisation, into the hands of an accredited credit institution established in Luxembourg. Grand-ducal regulations will fix the rate of interest to accrue thereon, which may exceed the maximum set by the Consignments Act of 12 February 1872.

The sums thus consigned for the account of the bond holders may be withdrawn on named or bearer mandates issued by the representatives of the body and endorsed by the judge presiding the division of the local court sitting in commercial matters. Payment of named mandates is effected on discharge by the recipients; bearer mandates are paid after having been receipted by the representatives of the body. Mandates may only be issued by the representatives of the body upon re-presentation of the bond. The representatives of the body state the sum mandated by them on the bond.

Article 94-7

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30/04/1987 p. 415), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816)) A company liable for bonds called for full or partial repayment whose bearer has not presented himself within a year of the date fixed for payment is authorised to consign the sums due. Consignment will be effected at the consignment institution of Luxembourg or, with the court’s authorisation, into the hands of an accredited credit institution established in Luxembourg.

Article 94-8

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30.04.1987 p. 415)) The company’s bankruptcy does not terminate the functioning and role of the general meeting of bond holders. Article 87(2) and (3) remains applicable even after the bankruptcy order.

Article 95

(replaced by the Act of 9 April 1987 (Official Gazette A29 of 30.04.1987 p. 415)) The provisions of articles 86 to 94-8 apply to foreign companies that subject a borrowing to Luxembourg law unless the conditions of issue of the borrowing provide otherwise. Luxembourg companies can derogate from the provisions of articles 86 to 94-8 of this act if they subject their borrowing to foreign law.

Article 96

Public limited liability companies may only issue redeemable bonds by drawing lots at a rate higher than the issue price on condition that the bonds bear interest of at least 3%, that they are all redeemable by the same amount and the amount of the annuity comprising the amortisation and that interest is the same throughout the full term of the borrowing. The amount of these bonds may in no event be greater than the paid-up share capital of the company.

Article 97

The provisions of the preceding article do not apply to bond issues whenever the issue rate is not less than one-tenth lower than the redemption rate.

Article 98

The condition subsequent is always implied in a loan contract effected in the form of a bond issue for the event that one of the two parties might fail to fulfil its undertaking. In that case, the contract is not terminated ipso iure. The party in whose favour the undertaking has not been executed has the choice of demanding specific performance of the agreement by the other party where that is possible or claiming its termination with damages. Termination must be applied for before the court and the defendant may be granted time, depending on the circumstances.

9. The term and dissolution of public limited liability companies and European companies (SE) (articles 99 to 101) (heading amended by the Act of 25 August 2006 (Official Gazette) A152 of 31/08/2006 p. 2684, the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816)))

Article 99

(replaced by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792)) Public limited liability companies may be incorporated for a limited or unlimited term. In the first case, the company’s term may be successively extended under the conditions set down in article 67-1.

In the second case, articles 1865, 5°, and 1869 of the Civil Code do not apply. However, the company’s dissolution may be petitioned for where there is just cause. Except in the case of judicial dissolution, the company’s dissolution may only result from a decision taken by the general meeting under the forms laid down for amendments to the articles of association.

Article 100

(amended by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Excepting more stringent provisions contained in the articles of association, in the event of loss of one-half of the company’s share capital, the board of directors or board of management, as the case may be, call a general meeting, such that it is held within a period not exceeding two months from the time when the loss has been discovered by them or ought to have been, which will deliberate under the terms of article 67-1 on whether or not to wind the company up.

The same rules are observed where the loss reaches three-quarters of the company’s share capital but, in that case, the dissolution will take place if approved by one-quarter of the votes cast at the meeting. In the event of breach of the foregoing provisions, the directors or members of the board of management, as the case may be, may be held personally and jointly and severally liable to the company for all or part of any augmentation in the loss.

Article 101

(amended by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), replaced by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) The local court sitting in commercial matters may, on a petition by the State prosecutor, pronounce the dissolution and order the liquidation of a European company (SE) whose statutory registered office is in the Grand Duchy of Luxembourg even if its central administration is not located there. The petition and the procedural acts in the framework of this article are notified through the court registry. Where the company cannot be contacted at its legal domicile in the Grand Duchy of Luxembourg, an extract of the petition is published in two newspapers printed in the country. However, the competent court must grant a period of six months to the company in question to remedy its situation, by either:

a) re-establishing its central administration in the Grand Duchy of Luxembourg; or

b) effecting a transfer of the statutory registered office by means of the procedure set down in articles 101-1 to 101-17.

The dissolution action is directed against the company. Dissolution is effective as of the date of the decision ordering same. However, it is only binding as against third parties under the conditions set down in article 9. The court may either pronounce immediate closure of the liquidation or fix the procedure for the liquidation and appoint one or more liquidators. It may, to such extent as it shall determine, render applicable the rules governing liquidation of the bankruptcy. Once the liquidation is completed, the liquidator reports to the court and submits to it a statement of the corporate assets and their deployment.

(2) Where it is determined either by the court on the initiative of the State prosecutor or at the initiative of any interested party that a European company (SE) has its central administration in the Grand Duchy of Luxembourg without having located its statutory registered office there, the State prosecutor informs the Member State where the statutory registered office of the European company (SE) is situated of this fact without delay.

10. Transfer of the statutory registered office of a European company (SE) (articles 101-1 to 101-17) (heading inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

Article 101-1

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The statutory registered office of a European company (SE) may be transferred from the Grand Duchy of Luxembourg to another Member State and from any of those States to the Grand Duchy of Luxembourg in accordance with articles 101-2 to 101-17. This transfer does not give rise to either its dissolution or the creation of a new legal person.

Sub-§1. Procedure for transfer of statutory registered office from the Grand Duchy of Luxembourg to another Member State (articles 101-2 to 101-10) (heading inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

Article 101-2

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) The board of directors or board of management, as the case may be, of a European company (SE) transferring its registered office draws up a written transfer project.

(2) The project states:

a) the current company name, statutory registered office and registration number of the European company (SE);

b) the statutory registered office envisaged for the European company (SE);

c) the articles of association envisaged for the European company (SE), including any new company name, if there is one;

d) the consequences that the transfer could have for the involvement of employees in the European company (SE);

e) the envisaged timetable for the transfer;

f) all the rights provided in relation to protection of the shareholders and/or creditors or bearers of securities other than shares.

Article 101-3

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816)) The transfer project is published in accordance with article 9 at least two months before the date of the general meeting called to pronounce on the transfer project.

Article 101-4

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The board of directors or board of management, as the case may be, prepares a report explaining and justifying the legal and economic aspects of the transfer and explaining the consequences of the transfer for the shareholders, creditors and workforce.

Article 101-5

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The shareholders and creditors of the European company (SE) have a right, at least one month before the general meeting called to pronounce on the transfer, to examine the transfer project and the report prepared pursuant to article 101-4 at the registered office of the European company (SE) and, on request, to be given copies of these documents free of charge.

Article 101-6

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816)) The transfer requires approval by the general meeting of the European company (SE). This decision requires presence quorum and a majority as laid down for amendments to the articles of association. It may not be taken until two months have elapsed since publication of the project referred to in article 101-3.

Article 101-7

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The creditors of the European company (SE) that is transferring its registered office whose claims pre-date the date of publication of the transfer project provided for in article 101-3 may, notwithstanding any agreement to the contrary, within two months of that publication apply to the judge presiding the division of the local court in whose jurisdiction the debtor company has its statutory registered office, sitting in commercial matters and as under the urgent applications procedure, for security to be constituted for claims that have matured or have not yet matured in the event that the transfer operation would have the effect of threatening those creditors’ liens or hindering enforcement of their claims. The president rejects this application if the creditor possesses adequate guarantees or if such are not necessary given the company’s situation after the transfer. The debtor company may have this application dismissed by paying the creditor even if the claim is future. If the security is not provided within the period laid down, the claim immediately falls due.

Article 101-8

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Without prejudice to the rules concerning collective exercise of their rights, article 101-7 is applied to the bond holders of the company transferring its registered office unless the transfer has been approved by a meeting of the bond holders or by the bond holders individually.

Article 101-9

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), amended by the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295))

(1) Holders of securities other than shares to which special rights attach must, within the company that has transferred its registered office, enjoy rights that are at least equivalent to those they enjoyed in the company prior to that transfer.

(2) Subarticle (1) is not applicable if the change in the rights in question has been approved by a meeting of the holders of those securities deciding under the presence and majority conditions set down in article 101-6.

(3) If the meeting provided for in the preceding subarticle is not called or if it rejects the proposed change, the securities in question are redeemed at the price corresponding to their valuation as contained in the transfer project and verified by an independent expert designated by the management and chosen from among st the accredited company auditors.

Article 101-10

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

(1) The minutes of the meeting deciding to effect the transfer are set down in a notarised deed.

(2) The notary must verify and attest the existence and legality of the acts and formalities incumbent on the company for which he is officiating and of the transfer project.

(3) The notary public issues a certificate attesting conclusively that the acts and formalities have been effected prior to the transfer.

Sub-§2. Effective date of the transfer of statutory registered office (articles 101-11 to 101-17) (heading inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684))

Article 101-11

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Transfer of the statutory registered office of a European company (SE) and the resulting amendment to its articles of association take effect on the date of registration which, in the case of the Grand Duchy of Luxembourg, is effected in the register of commerce and companies.

Article 101-12

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Where a European company (SE) transfers its registered office to the Grand Duchy of Luxembourg, registration in the register of commerce and companies may only be effected upon presentation of the certificate attesting conclusively that the acts and formalities have been effected prior to the transfer, drawn up by the competent authority of the Member State in which the European company (SE) previously had its statutory registered office.

Article 101-13

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) A European company (SE) that transfers its statutory registered office to another Member State is regarded for the purpose of any dispute arising prior to the transfer as determined in article 101-11 as having its statutory registered office in the Member State where the European company (SE) was registered prior to the transfer, even if an action is raised against the European company (SE) after the transfer.

Article 101-14

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2699)) Transfer of the statutory registered office of a European company (SE) is not binding as against third parties, with the exclusion of its shareholders, until the date of publication of the new registration of the European company (SE). However, until publication of deletion of the register entry for the previous registered office has taken place, third parties may continue to rely on the old registered office unless the European company (SE) proves that they had knowledge of the new registered office.

Article 101-15

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Once the new registration of the European company (SE) has been effected, the register where the new registration has been done notifies the register where the old registration was done of that fact. The old registration is deleted upon receipt of the notification, and not before.

Article 101-16

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Notice is published of the new registration and deletion of the old registration, with articles 9, 10 and 11bis of this act being applicable.

Article 101-17

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684) A European company (SE) subject to dissolution, liquidation, bankruptcy, creditors’ arrangement or other, similar procedures such as a moratorium, administration or a procedure to institute special management or oversight may not transfer its statutory registered office.

PART V. PARTNERSHIPS LIMITED BY SHARES (ARTICLES 102 TO 112)

Article 102

(amended by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) A partnership limited by shares is one that, for a limited term or unlimited term, is contracted by one or more shareholders who are liable jointly and severally and without limitation for the partnership’s commitments along with one or more shareholders whose commitment is limited to a certain amount.

Article 103

(amended by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816)) The provisions relative to public limited liability companies apply to partnerships limited by shares except for the changes indicated in this part. Moreover, partnerships limited by shares are not subject to the specific provisions governing European companies (SE).

Article 104

(repealed by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) [...]

Article 105

(replaced by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), amended by Grand-Ducal Regulations of 23 December 1994 (Official Gazette A116 of 24/12/1994 p. 2735), the Act of 19 December 2002 (Official Gazette A149 of 31/12/2002 p. 3651), the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) All deeds, invoices, announcements, publications, letters, order forms and other documents emanating from partnerships limited by shares must contain:

1) the partnership’s name;

2) the words “société en commandite par actions” reproduced in a legible fashion in full;

3) precise particulars of the registered office;

4) the words “Registre de commerce et des sociétés, Luxembourg” or the initials “R.C.S. Luxembourg” followed by the company’s registration number. If the documents specified above mention the company’s share capital, this mention must take account of the reduction it may have undergone according to the results of successive balance sheets and shall state any part that has not yet been paid and, in the case of a capital increase, any part that has not yet been subscribed.

Notice of any change in the registered office is published in the Official Gazette C, Digest of Companies and Associations, through the offices of the management. The penalties stipulated in article 77 apply to any agent acting for the company relative to any deed in respect of which those requirements are not adhered to.

Article 106

(amended by the Act of 8 March 1989 (Official Gazette A14 of 17/03/1989 p. 176)) Bearer shares are signed by the managers. Unless otherwise provided in the articles, these signatures or one of them must be either handwritten or printed or adhibited by means of a stamp.

Article 107

(amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) Management of the partnership is the responsibility of one or more managers, who may but need not be general partners, designated in accordance with the articles. Managers not acting in the capacity of general partners are liable in accordance with article 59.

The articles may allow the managers to delegate their powers to one or more agents, whose liability is restricted to performance of their mandate. Unless the articles provide otherwise, each manager may act in the partnership’s name in carrying out all deeds necessary or useful for achievement of the partnership’s purpose. Restrictions imposed by the articles on the managers’ powers are not binding as against third parties, even if they are published. However, the articles may confer capacity on one or more managers to represent the partnership alone or jointly, and such a clause is binding as against third parties under the conditions set down in article 9.

The partnership is bound by deeds carried out by the manager or managers even if those deeds should be ultra vires unless it proves that the third party knew that the deed was ultra vires or could not have been ignorant of that fact in the circumstances. Each manager represents the partnership vis-à-vis third parties and in legal procedures, whether as plaintiff or defendant. Legal process may be validly served on behalf of or against the partnership in the name of the partnership alone.

Article 108

(amended by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) A limited partner may contract any transaction with the partnership limited by shares without his ranking as unsecured or preferred creditor, depending on the terms of the transaction in question, being affected simply by dint of his being a limited partner.

He may not engage in any act of management vis-à-vis third parties. Limited partners are jointly and severally liable without limit towards third parties for all the commitments of the company in which they shall have participated in breach of the prohibition in the preceding paragraph. They are also jointly and severally liable without limit towards third parties even for commitments in which they did not participate if they have habitually engaged in management acts vis-à-vis them.

There shall not fall to be considered as management acts for which a limited partner incurs unlimited, joint and several liability towards third parties any exercise of the prerogatives of partner, opinions and advice given to the partnership or to its affiliated entities or their managers, audit and surveillance acts, the grant of loans, guarantees or security or any other form of assistance to the partnership or to its affiliated entities or authorisations given to the managers in cases provided for in the articles for acts that exceed their powers. Limited partner may act in the capacity of a member of a management organ or agent of a manager of the partnership, even a general partner, or assume that general partner’s signature on behalf of the partnership, even acting as a representative of the partnership, without thereby incurring unlimited, joint and several liability for the partnership commitments on condition that the representative capacity in which he acts is specified.

Article 109

Audit of the partnership must be entrusted to at least three statutory auditors.

Article 110

The supervisory board may give opinions on matters submitted to it by the managers and authorise acts that exceed their powers.

Article 111

(amended by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) Unless otherwise provided in the articles, the partners in general meeting shall only make or ratify acts affecting the partnership vis-à-vis third parties or that amend the articles with the agreement of the general partners.

Article 112.

(amended by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) In the case of the death, dissolution, legal incapacity, recall, resignation, hindrance or bankruptcy of, or other situations in which there are competing claims against, the general partner, if there is no other and if it is stipulated that the partnership should continue, a replacement will be arranged for him. Failing specific stipulations in this regard in the contract of partnership, the judge presiding the division of the local court sitting in commercial matters may, on a petition by any interested party, designate a provisional director, who need not be a member, who alone will engage in urgent acts and acts of simple administration, until a decision is taken by the partners, which that director shall cause to be taken within two weeks of his appointment. The director is responsible only for performance of his mandate. Any interested party may appeal the order; the appeal is served on the partnership and on the designated person and on the party that petitioned for his appointment. It is ruled on under the urgent applications procedure.

PART VI. COOPERATIVE COMPANIES (ARTICLES 113 TO 137-62)

Sub-part 1. Cooperative companies in general (articles 113 to 137)

1. The nature and formation of cooperative companies (articles 113 to 118)

Article 113

A cooperative company is a company made up of members whose number and capital contributions are variable and whose shares are non-transferable to third parties.

Article 114

A cooperative company does not exist under an appellation; it bears a distinct name. The company must comprise at least seven persons. It is administered by one or more agents, who need not be members, who are only responsible for the mandate they have been given. Audit of the company is entrusted to one or more statutory auditors, who need not be members. The members may bind themselves jointly and severally or separately, without limit or to the extent of a certain value.

Article 115

The company’s formation deed must stipulate the following items, failing which it is void:

1) the company’s name, its registered office;

2) the company’s purpose;

3) precise designation of the members;

4) the manner in which the company’s funds are or will later be formed, and their minimum immediate subscription figure. However, these items rendering the formation deed void may not be enforced by the members vis-à-vis third parties; among the members inter se, items rendering the deed void will be effective as from the date of a claim seeking to have the deed declared void.

Article 116

(amended by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295)) The deed must additionally state:

1) the term of the company, which may be limited or unlimited. In the former case, the company’s term may be successively extended under the conditions set down in article 67-1. In the latter case, articles 1865, 5° and 1869 of the Civil Code are not applicable. However, the company’s dissolution may be petitioned for before a court for just cause. Apart from judicial dissolution, the company’s dissolution may only result from a decision taken by the general meeting under the forms laid down for amendments to the articles

2) the conditions for the admission, departure and exclusion of members and the conditions under which payments may be withdrawn;

3) how and by whom the company’s affairs will be administered and audited and, if appropriate, the method for appointing and recalling the managers, directors, statutory auditors or accredited company auditors, the scope of their powers and the length of their term in office;

4) the powers of the general meeting, the rights accorded to the members thereat, the method of calling meetings, the majority required for the deliberations to be valid, the method of voting;

5) the distribution of profits and losses;

6) the extent of the members’ liability, whether they are bound jointly and severally or severally for the company’s commitments, over their entire assets or only up to a given amount.

Article 117

(amended by the Act of 25 August 1986 (Official Gazette A65 of 27/08/986 p. 1826), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295)) Failing provisions on the matters referred to in the previous article, they are governed as follows:

1) the company's duration is ten years;

2) the members can only be excluded from the company for non-performance of the contract; the general meeting pronounces exclusions and admissions and authorises withdrawals of payments.

3) the company is managed by one director and audited by one statutory auditor or accredited company auditor, who are appointed and recalled and deliberate in the same manner as in public limited liability companies;

4) all the members may vote at general meetings; they have equal votes; notices of meetings are sent by recorded delivery letter signed by the management; the meeting’s powers are fixed and resolutions adopted according to the rules laid down for public limited liability companies;

5) the profits and losses are divided up each year to the extent of one-half into equal shares among the members and one-half according to their stakes;

6) the members are all bound jointly and severally and without limitation.

Article 118

(amended by Act of 11 August 1996 (Official Gazette A53 of 20/08/1996 p. 1660), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295)) Each cooperative company must keep a register containing on its first page the deed of incorporation of the company and, further to that deed:

1) the names, occupations and addresses of the members of the company;

2) the date of their admission, departure or exclusion;

3) the account of sums paid in or withdrawn by each of them;

4) the dates of audits carried out and the names of the statutory auditors or accredited company auditors.

This book will be paginated, initialled and endorsed by one of the judges of the local court sitting in commercial matters or by the mayor of the municipality, at no cost. The initials may be replaced by the seal of the court or local authority council. Particulars of withdrawals of contributed funds are signed by the member of the company making same.

2. Changes in the personnel and business assets of the company (articles 119 to 128)

Article 119

The fact of being a member of the company and the number of shares that each of them holds from time to time are recorded, independently from other means of evidence under commercial law, by the adhibition of their signature, preceded by the date, against their name in the company’s register.

Article 120

(amended by the Act of 25 August 1986 (Official Gazette A65 of 27/08/1986 p. 1826)) The members have the right to withdraw from the company at any time under such terms and conditions as may be set down in the articles of association. They may only resign within the first six months of the company’s financial year.

Article 121

Departures are recorded by the fact being written on the member’s certificate of membership and in the company’s register in the margin next to the departing member’s name. These particulars are dated and signed by the member and by one director.

Article 122

If the directors refuse to record a member’s departure or if the departing member cannot sign, it is intimated to the registry of the justice of the peace court for the location of the company’s registered office. The clerk of court prepares a minute thereof and notifies this to the company by recorded delivery letter sent within twenty-four hours. The minute is on unstamped paper and is registered free of charge.

Article 123

Exclusion from the company follows from a minute drawn up and signed by a director. This minute sets forth the facts establishing that the exclusion has been pronounced in accordance with the articles of association; it is transcribed into the register of members of the company and a true copy thereof is sent to the excluded member by recorded delivery letter within two days.

Article 124

(amended by the Act of 25 August 1986 (Official Gazette A65 of 27/08/986 p. 1826)) A departing or excluded member may not procure the company’s liquidation. Unless otherwise provided in the articles of association, he is entitled only to the nominal value of his shares in the company. In no event may the balance sheet items forming the counter party of public funds granted to the cooperative company be distributed to him. If it follows from the balance sheet situation of the financial period during which the departure has been announced or the exclusion pronounced that the value of the shares is less than their nominal value, the departing member’s rights are reduced accordingly.

Article 125

In the event of the death, bankruptcy, creditors’ arrangement, insolvency or prohibition of or against a member, his heirs, creditors or representatives recover his share in the manner set down in Article 124. They cannot procure the company’s liquidation.

Article 126

Any departing or excluded member remains personally liable within the limits to which he has committed himself and for five years as from publication of his resignation or exclusion, except in cases of a shorter prescription period laid down by law, for all commitments contracted before the end of the year in which notice of his withdrawal was published. The same rules are applicable in the cases provided for in Article 125.

Article 127

The rights of each member are represented by a certificate made out in the name of the holder, bearing the name of the company, the surnames, first names, capacity and address of the holder, the date of his admission, successive subscriptions and departure, all signed by the holder and a director. It states in date order the payments and withdrawals of sums by the holder. These annotations are, as the case may be, signed by a director or by the holder and constitute a receipt. It contains the company’s articles of association. It is free from stamp and registration duty.

Article 128

The member’s personal creditors may only attach the interest and dividends due to him and the share allotted to him upon dissolution of the company.

3. Measures in the interests of third parties (articles 129 to 137)

Article 129

Each year, at the time laid down by the articles of association, the management draws up an inventory and prepares the balance sheet and profit and loss account in the form laid down by Article 72. A reserve shall be constituted in the manner required by the said article.

Article 130

In all instruments, invoices, announcements, publications and other documents emanating from cooperative companies, there must be stated the company’s name immediately preceded or followed by these words, written legibly and printed out in full: Société coopérative.

Article 131

Any agent of a cooperative company acting on its behalf in an instrument where the requirements of the preceding article are not complied with may, according to the circumstances, in default of the company, be held personally liable for the commitments undertaken therein by the company.

Article 132

(amended by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), the Act of 19 December 2002 (Official Gazette A149 of 31/12/2002 p. 3654)) The financial statements as defined in the Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings are lodged with the register of commerce and companies within a month of being approved.

Article 133

(amended by the Act of 19 December 2002 (Official Gazette A149 of 31/12/2002 p. 3651)) Those that manage the company must every six months lodge with the register of commerce and companies a list setting forth in alphabetical order the names, occupations and addresses of all the members, dated and certified true by the signatories. Those parties are liable for any erroneous statement contained in such lists.

Article 134

(amended by the Act of 19 December 2002 (Official Gazette A149 of 31/12/2002 p. 3651)) Within a month of being appointed, the managers must lodge with the register of commerce and companies an extract of the instrument recording their appointment and powers. They must present themselves at the register of commerce and companies to adhibit their signature, or cause it to appear in the register of commerce and companies in notarial form.

Article 135

(amended by the Act of 19 December 2002 (Official Gazette A149 of 31/12/2002 p. 3654)) The general public may take cognisance free of charge of the list of members, deeds by which management authority is conferred and the financial statements. Any person may request copies on unstamped paper in exchange for payment of administrative costs.

Article 136

Cooperative companies may federate to pursue in common all or part of the corporate purpose provided in their articles of association or to ensure achievement of their statutory and regulatory obligations. Federations shall constitute a legal entity distinct from that of the companies forming them. They will be subject to the provisions governing cooperative companies unless it falls to public administration regulations to supplement these provisions and even amend them in so far as they apply to federations.

Article 137

(amended by the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295)) Article 69(1), (2) and (4) of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings applies. Institution of the statutory auditors in articles 114, 116, point 3, and 117, point 3, is held as deleted for cooperative companies that arrange to have their financial statements audited by an accredited company auditor in accordance with the first paragraph of this article. In the event of breach of the audit requirements, the directors of federations and companies will be personally and jointly and severally liable for any loss resulting from such breach.

Sub-part 2. Cooperative companies organised as public limited liability companies (articles 137-1 to 137-10) (heading inserted by the Act of 10 June 1999 (Official Gazette A69 of 11/06/1999 p. 1470))

Article 137-1

(inserted by the Act of 10 June 1999 (Official Gazette A69 of 11/06/1999 p. 1470), supplemented by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816))

(1) A cooperative company may also be organised as a public limited liability company.

(2) A cooperative company organised as a public limited liability company is subject to the provisions relative to cooperative companies apart from the adjustments set out in this sub-part.

(3) A cooperative company organised as a public limited liability company is likewise subject to the provisions relative to public limited liability companies in this act, apart from the adjustments set out in this sub-part. It is not subject to the provisions specifically governing European companies (SE).

(4) The provisions concerning the formation of cooperative companies organised as public limited liability apply to transformation of an entity in another form into a cooperative company organised as a public limited liability company.

Article 137-2

(inserted by the Act of 10 June 1999 (Official Gazette A69 of 11/06/1999 p. 1470)) The capital of a cooperative company organised as a public limited liability company is divided into shares. All references to “shares” (in a cooperative company) in sub-part 1 of this part are to be construed as references to “shares” (in a public limited liability company) in so far as the wording of sub-part 1 applies to a cooperative company organised as a public limited liability company and in so far as the terms are used in an identical sense.

Article 137-3

(inserted by the Act of 10 June 1999 (Official Gazette A69 of 11/06/1999 p. 1470)) Article 4, second paragraph, does not apply to a cooperative company organised as a public limited liability company.

Article 137-4

(inserted by the Act of 10 June 1999 (Official Gazette A69 of 11/06/1999 p. 1470), amended by the Act of 21 December 2006 (Official Gazette A228 of 27/12/2006 p. 4070), the Act of 6 April 2013 (Official Gazette A71 of 15/04/2013 p. 890))

(1) Without prejudice to the provisions of article 137-5, subarticle (1), article 23 does not apply to cooperative companies organised as public limited liability companies.

(2) Article 26, subarticle (1), 2), 3) and 4), and subarticle (2), does not apply to cooperative companies organised as public limited liability companies. Apart from that which is stated in article 26(1)1), formation of a cooperative company organised as a public limited liability company requires immediate subscription of the corporate funds set forth in the articles.

(3) Articles 26-1 to 26-5 do not apply to cooperative companies organised as public limited liability companies.

(4) Article 27, 5), 8), 9), 10) and 14) does not apply to cooperative companies organised as public limited liability companies.

Instead of the particulars provided for in article 27, 6) and 7), the articles state:

– the manner in which the corporate fund is or will subsequently be formed, and the minimum immediate subscription; and – the number of subscribed shares, the classes of shares, where there is more than one, and the rights attaching to each of those classes. The articles of association also state the conditions for the admission, departure and exclusion of members and the conditions under which payment may be withdrawn.

(5) Articles 28 to 36 do not apply to cooperative companies organised as public limited liability companies.

(6) In article 37, first paragraph, the words “of equal value” do not apply to cooperative companies organised as public limited liability companies. In article 37, first paragraph, the shares referred to are only registered for a cooperative company organised as a public limited liability company. In article 37, second paragraph, the securities or beneficiary certificates referred to may be registered, bearer or dematerialised for a cooperative company organised as a public limited liability company. Article 37, third and fourth paragraphs, does not apply to a cooperative company organised as a public limited liability company.

(7) Articles 39 and 40 do not apply to a cooperative company organised as a public limited liability company.

(8) As regards cooperative companies organised as public limited liability companies, articles 41 and 42 apply only to securities or beneficiary certificates referred to in the preceding subarticle (6).

(9) Article 43 does not apply to a cooperative company organised as a public limited liability company.

(10) Article 44, subarticle (1), 1), does not apply to a cooperative company organised as a public limited liability company.

(11) In article 45, subarticles (2) and (3), the words “within the limits laid down in article 44(1)” do not apply to a cooperative company organised as a public limited liability company.

(12) Article 46, subarticle (1), fourth indent, does not apply to a cooperative company organised as a public limited liability company.

(13) Article 48 does not apply to a cooperative company organised as a public limited liability company.

(14) Articles 49-1 to 49bis do not apply to a cooperative company organised as a public limited liability company.

(15) Articles 69 to 69-2 do not apply to a cooperative company organised as a public limited liability company.

(16) Articles 72-1 to 72-4 do not apply to a cooperative company organised as a public limited liability company.

(17) In article 76, first paragraph, 2), the words “public limited liability company” are replaced by the words “cooperative company organised as a public limited liability company”.

Article 137-5

(inserted by the Act of 10 June 1999 (Official Gazette A69 of 11/06/1999 p. 1471))

(1) Articles 114 to 117, with the exception of the fifth paragraph of article 114, do not apply to a cooperative company organised as a public limited liability company.

(2) Any member may inspect the register referred to in article 118. Article 118, second and third paragraphs, does not apply to a cooperative company organised as a public limited liability company.

(3) The second sentence of article 120 does not apply to a cooperative company organised as a public limited liability company.

(4) Articles 126 and 129 to 135 do not apply to a cooperative company organised as a public limited liability company.

(5) Article 136 applies without distinction to cooperative companies and cooperative companies organised as public limited liability companies.

Article 137-6

(inserted by the Act of 10 June 1999 (Official Gazette A69 of 11/06/1999 p. 1470)) Part IX. Court actions and prescription periods and part XI. Criminal provisions apply to cooperative companies organised as public limited liability companies.

Article 137-7

(inserted by the Act of 10 June 1999 (Official Gazette A69 of 11/06/1999 p. 1470)) Part XIII. Company financial statements does not apply to a cooperative company organised as a public limited liability company.

Article 137-8

(inserted by the Act of 10 June 1999 (Official Gazette A69 of 11/06/1999 p. 1470))

(1) Part XIV. Mergers applies to a cooperative company organised as a public limited liability company, albeit subject to the following provisions.

(2) A cooperative company organised as a public limited liability company may only absorb a public limited liability company or a cooperative company organised as a public limited liability company if the shareholders or members of the other company or company fulfil the conditions required to qualify in the capacity of member of the absorbing company.

(3) In cooperative companies organised as public limited liability companies, each member has the ability, notwithstanding any provision to the contrary contained in the articles of association, to resign at any time during the course of the financial year and without the need to meet any other condition, as from the time at which a general meeting is called to decide on the company’s merger with an absorbing company having the form of a public limited liability company.

The resignation must be notified to the company by recorded delivery letter posted at least five days before the date of the meeting. It will only be effective if the merger resolution is passed. Notices calling such meetings must contain the text of the first and second paragraphs of this subarticle.

(4) The provisions of subarticles (2) and (3) of this article apply to merger by the incorporation of a new entity.

Article 137-9

(inserted by the Act of 10 June 1999 (Official Gazette A69 of 11/06/1999 p. 1470))

(1) Part XV. Divisions applies to a cooperative company organised as a public limited liability company, albeit subject to the following provisions.

(2) A cooperative company organised as a public limited liability company may only participate in a division transaction as receiving entity if the shareholders or members of the divided company fulfill the conditions laid down to qualify as members of that receiving company.

(3) In cooperative companies organised as public limited liability companies, each member has the ability, notwithstanding any provision to the contrary contained in the articles of association, to resign at any time during the course of the financial year and without the need to meet any other condition, as from the time at which a general meeting is called to decide on the company’s division in favour of recipient companies at least one of which is in another form. The resignation must be notified to the company by recorded delivery letter posted at least five days before the date of the meeting. It will only be effective if the division resolution is passed.

Notices calling such meetings must contain the text of the first and second paragraphs of this subarticle.

(4) The provisions of subarticles (2) and (3) of this article apply to divisions by the incorporation of new entities.

Article 137-10

(inserted by the Act of 1 June 1999 (Official Gazette A69 of 11/06/1999 p. 1470)) Part XVI. Consolidated financial statements does not apply to a cooperative company organised as a public limited liability company.

Sub-part 3. European cooperative companies (SEC) (articles 137-11 to 137-62)

1. General provisions (articles 137-11 to 137-14)

Sub-§1. Definitions (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-11

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) For the purposes of this sub-part, “Regulation (EC) no. 1435/2003” shall mean: Council Regulation (EC) no. 1435/2003 of 22 July 2003 on the Statute for a European Cooperative Company (SEC).

Sub-§2. Formation, capital contribution and registered office (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-12

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

(1) A European cooperative company (SEC) is formed by special notarial deed drawn up and published according to the requirements applying to public limited liability companies.

(2) As regards contributions in kind, articles 26-1 to 26-3 apply mutatis mutandis to European cooperative companies (SEC).

Article 137-13

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) Where it is determined that only the central administration is situated in the Grand Duchy of Luxembourg, the State prosecutor immediately informs the Member State where the statutory registered office of the European cooperative company (SEC) is situated.

Sub-§3. Investor members (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-14

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The articles of association can provide that persons unlikely to use or produce the goods and services of the European cooperative company (SEC) may be admitted in the capacity of investor members (non-user members).

2. Formation (articles 137-15 to 137-22)

Sub-§1. Formation by way of merger

A. Procedure (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-15

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The merger project is drawn up by the board of directors or board of management, as the case may be.

Article 137-16

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The merger project and the particulars provided for in article 24 of Regulation (EC) no. 1435/2003 are published in accordance with article 262, subarticle (1).

B. Legality scrutiny (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-17

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) Scrutiny of the legality of the merger and issue of the certificate, both provided for in article 29 of Regulation (EC) no. 1435/2003, are carried out by the officiating notary public in accordance with article 271.

Article 137-18

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) Scrutiny of the legality of the merger provided for in article 30 of Regulation (EC) no. 1435/2003 is carried out by the officiating notary public.

Sub-§2. Transformation of a cooperative company into a European cooperative company (SEC) (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-19

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The project for transformation of a cooperative company into a European cooperative company (SEC) is drawn up by the management organ.

Article 137-20

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The transformation project is published in accordance with article 9.

Article 137-21 (inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The independent expert(s) referred to in article 35, paragraph 5, of Regulation (EC) no. 1435/2003 are one or more company auditors designated by the management organ from among the members of the Institute of Company Auditors.

Sub-§3. Participation in a European cooperative company (SEC) by a company having its central administration outside the European Community (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-22

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) A company that does not have its central administration in a Member State may participate in the formation of a European cooperative company (SEC) if it is constituted according to the law of a Member State, has its statutory registered office in that same Member State and has an effective, continuous link with the economy of a Member State.

3. Organs (articles 137-23 to 137-47)

Sub-§1. Administration

A. Provisions common to single and double-organ systems (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-23

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) Any statutory or regulatory provision concerning commercial companies and referring to the “board of directors”, or “director(s)” or “manager(s)” of a cooperative company is to be construed, in the framework of a European cooperative company (SEC) endowed with a board of management and a supervisory board, as referring to the board of management of the company concerned unless, according to the duties conferred, it falls to be construed as referring to the supervisory board.

Article 137-24

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The members of the management, supervision or administration organs may, if the articles of association so provide, be legal entities, in which case articles 51bis and 60bis-4 apply.

Article 137-25

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) A European cooperative company (SEC) is bound by acts engaged in by the organs with capacity to represent it even if those acts should be ultra vires, unless it proves that the third party knew that the act was ultra vires or could not have been ignorant of that fact in the circumstances, providing always that mere publication of the articles of association shall not suffice to constitute such proof.

B. Single-organ system (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-26

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The administrative organ is the board of directors. It may delegate its day-to-day management function in accordance with article 60. Where, in a European cooperative company (SEC), powers have been validly delegated and the holder enters into an act that falls within the bounds of that delegation but nonetheless falls within a category of transactions that, according to the provisions of the articles of the European cooperative company (SEC), give rise to an express decision by the board of directors, he binds the company, without prejudice to any damages that might be due.

Article 137-27

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The minimum number of directors is fixed at three.

C. Double-organ system

C 1. General provisions (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-28

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The management organ is the board of management. It is made up of one or more members. The supervisory organ is the supervisory board. It comprises at least three members.

Article 137-29

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) Under reservation of the limitations imposed by Regulation (EC) no. 1435/2003, by this act or by the articles of association, the remit of the board of management and its members is the same as that of the board of directors and the directors.

Article 137-30

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) Any report requiring to be drawn up by the board of directors under this act is drawn up by the board of management. Unless otherwise provided by law or a more restrictive provision contained in the articles of association, it is intimated in due time to the supervisory board and subject to the same information and disclosure rules as apply to reports by the board of directors.

Article 137-31

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The board of management has power to engage in all acts necessary or expedient for achievement of the company’s purpose, with the exception of those that, by law or under the articles of association, are the preserve of the supervisory board or general meeting. It may delegate the day-to-day management function in accordance with article 60bis-8. The articles of association set forth the categories of transactions that give rise to authorisation of the board of management by the supervisory board. The absence of authorisation from the supervisory board is not binding as against third parties. Where, in a European cooperative company (SEC), powers have been validly delegated and the holder enters into an act that falls within the bounds of that delegation but nonetheless falls within a category of transactions that, according to the provisions of the articles of the European cooperative company (SEC), give rise to authorisation of the board of management by the supervisory board, he binds the company, without prejudice to any damages that might be due.

C2. Board of management

I. Status of the members of the board of management (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-32

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The members of the board of management are appointed by the supervisory board. The articles of association may nonetheless confer power on the general meeting to appoint the members of the board of management. In that case, the meeting has exclusive competence. The members of the board of management may be recalled by the supervisory board and, if so provided by the articles of association, by the general meeting.

II. Competence and functioning (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-33

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) If there are two or more, the members of the board of management constitute a collective organ, which deliberates according to the procedures laid down by the articles of association.

Article 137-34

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) Limitations imposed on the powers of the board of management by either the articles of association or pursuant to a decision by the competent organs are not binding as against third parties, even if notice thereof is published.

Article 137-35

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The board of management represents the company vis-à-vis third parties and in legal procedures, whether as plaintiff or as defendant, subject to the application of article 39, paragraph (1), of Regulation (EC) no. 435/2003. Legal process on behalf of or against the company is validly served in the name of the company alone.

The articles of association may confer capacity on one or more members of the board of management to represent the company in acts or in legal procedures, either alone or jointly. This clause in the articles of association is binding as against third parties under the conditions provided in article 9. The articles of association may impose restrictions on such powers of representation. Such restrictions are not binding as against third parties even if notice thereof is published.

C3. Supervisory board

I. Status of the members of the supervisory board (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-36 (inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The provisions of articles 51, 51bis and 52 apply to the supervisory board.

II. Competence and functioning (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-37 (inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

(1) The supervisory board forms a collective organ that deliberates according to the procedures laid down in the articles of association.

(2) The supervisory board exercises permanent oversight over the company’s management by the board of management, but may not interfere in that management.

(3) The supervisory board may request the board of management to provide it with information of any kind that is necessary for the oversight that it exercises pursuant to subarticle (2).

Article 137-38

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The supervisory board meets when called to do so by its chairman. The chairman must cause the supervisory board to meet if a request to that effect is made by two or more of its members or by the board of management. The board meets at intervals set down in the articles of association. The supervisory board may invite members of the board of management to attend meetings of the board, in which case they have a consultative voice.

C4. Rules common to members of the board of directors, the board of management and the supervisory board

I. Remuneration (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-39

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The duties as a member of the board of management and as a member of the supervisory board may be remunerated. The method and amount of the remuneration of the members of the board of management are fixed by the supervisory board. The method and amount of the remuneration of the members of the supervisory board are fixed by the articles of association, failing which by the general meeting.

II. Liability (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-40

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The members of the board of directors, the board of management and the supervisory board are liable to the company in terms of the ordinary law for performance of the office endowed upon them and faults committed in the exercise of their duties.

Article 137-41

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The members of the board of directors, the board of management and the supervisory board are jointly and severally liable either to the company or to any third party for all damages resulting from breach of the terms of Regulation (EC) no. 1435/2003, this act or the articles of association of the company.

They shall not be discharged from that liability, as regards breaches in which they played no role, unless no fault is attributable to them and they have reported the breaches to the next general meeting following their becoming aware thereof.

Sub-§2. General meeting of shareholders

A. Common provision (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-42

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The board of directors, board of management, as the case may be, together with the supervisory board and the accredited company auditor or auditors designated to effect legal audits of the financial statements and any consolidated financial statements are entitled to call general meetings.

B. Ordinary general meeting (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-43

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) A general meeting is held once a year within six months of the closing of the financial year. However, the first general meeting may be held within the eighteen months following formation of the company.

Article 137-44

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) In the double-organ system, the general meeting pronounces on the discharge granted to the members of the supervisory board and board of management pursuant to article 74.

C. Voting right (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-45

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

(1) The articles of association may provide that a member possesses a number of votes that is determined by his participation in the cooperative company’s business activities, to the exclusion of his holding in the form of a capital contribution. The votes thus attributed may not exceed the lesser of 5 per member or 30% of the total voting rights. The articles of association of European cooperative companies (SEC) engaged in activities in the financial or insurance sector may provide that the number of votes is determined by the member’s participation in the cooperative company’s business activities, including in the form of a holding in the capital of the European cooperative company (SEC). The votes thus attributed may not exceed the lesser of 5 per member or 20% of the total voting rights.

The articles of association of European cooperative companies (SEC) the majority of whose members are cooperative companies may provide that the number of votes is determined according to the members’ participation in the business activities carried on by the cooperative company, including in the form of a holding in the capital of the European cooperative company (SEC) and/or the number of members of each constituent entity.

(2) The investor members determined in article 137-14 may not possess more than 25% of the total voting rights.

(3) The articles of association of European cooperative companies (SEC) may provide for employees’ representatives to take part in general meetings or article or branch meetings provided that, together, the employees’ representatives do not control more than 15% of the total voting rights. The participation right ceases to apply where the registered office of the European cooperative company (SEC) is moved to a Member State whose laws do not make provision for employees’ participation.

D. Branch or article meetings (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-46 (inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) Pursuant to article 63, paragraph (1), of Regulation (EC) no. 1435/2003, the articles of association may provide for branch or article meetings.

Sub-§3. Corporate litigation (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-47

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The directors and members of the board of management and supervisory board are liable pursuant to the terms of article 59.

4. Move of statutory registered office (articles 137-48 to 137-53) (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-48

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The transfer project is drawn up by the board of directors or board of management, as the case may be. The project is published in accordance with article 9.

Article 137-49

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The board of directors or board of management, as the case may be, prepares the report referred to in article 7, paragraph (3), of Regulation (EC) no. 1435/2003.

Article 137-50

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The creditors of a European cooperative company (SEC) transferring its registered office whose claims predate the date of publication of the transfer project provided for in article 137-50 may, notwithstanding any agreement to the contrary, apply within two months of said publication to the judge presiding the division of the local court in whose jurisdiction the debtor company has its statutory registered office, sitting in commercial matters and as under the urgent applications procedure, for security to be constituted for claims matured or not yet matured in the event that the transfer operation would have the effect of threatening the lien of such creditors or hindering enforcement of their claims. The president rejects the application if the creditor possesses adequate guarantees or if they are not necessary given the company’s situation after the transfer. The debtor company may have this application dismissed by paying the creditor even if the claim is future. If the security is not provided within the period laid down, the claim immediately falls due.

Article 137-51

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) In accordance with article 7, paragraph (8), of Regulation (EC) no. 1435/2003, the officiating notary issues a certificate attesting conclusively that the acts and formalities prior to the transfer have been carried out.

Article 137-52

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) Notice of the new registration and deletion of the old registration is published, whereby articles 9, 10 and 11bis of this act shall be applicable.

Article 137-53

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The transfer to the Grand Duchy of Luxembourg of the statutory registered office of a European cooperative company (SEC) must be set down in an officially recorded deed. Registration in the register of commerce and companies may only be effected upon presentation of the certificate attesting conclusively that the acts and formalities prior to the transfer have been carried out as drawn up by the competent authority of the Member State in which the European cooperative company (SEC) had previously established its statutory registered office.

**5.**Financial statements and consolidated financial statements, and their audit. Special provisions applying to the double-organ system (article 137-54) (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-54

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) Each year, the supervisory board receives from the board of management the documents referred to in article 72, applicable mutatis mutandis to European cooperative companies (SEC), at the time fixed for their submission to the statutory auditors and presents to the general meeting its observations on the report by the board of management and on the financial statements for the financial period.

6. Dissolution, liquidation, insolvency and cessation of payments (articles 137-55 to 137-56) (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-55

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) Article 101, subarticle (1), of this act applies to a European cooperative company (SEC) having its statutory registered office in the Grand Duchy of Luxembourg but whose central administration is not located there.

Article 137-56

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) Regarding the distribution of net assets in accordance with the principle of disinterested distribution, referred to in article 75 of Regulation (EC) no. 1435/2003, that principle may be deviated from provided some other rule is provided in the articles of association of the European cooperative company (SEC).

7. Transformation of a European cooperative company (SEC) into a cooperative company (articles 137-57 to 137-59) (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-57

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The transformation project is drawn up by the management organ. It is published in accordance with article 9.

Article 137-58

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The independent expert or experts referred to in article 76, paragraph (5), of Regulation (EC) no. 1435/2003 are one or more accredited company auditors designated by the management organ from among the members of the Institute of Company Auditors.

Article 137-59

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) The general meeting of the European cooperative company (SEC) decides on the transformation.

8. Criminal provisions (articles 137-60 to 137-61) (heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-60

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) Part XI. Criminal provisions is applicable to European cooperative companies.

Article 137-61

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) In the double-organ system, the criminal provisions applicable to members of the board of directors apply to members of the board of management.

9. Final provisions (article 137-62)(heading inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482))

Article 137-62

(inserted by the Act of 10 March 2014 (Official Gazette A39 of 19/03/2014 p. 482)) Article 76 applies by analogy to European cooperative companies (SEC).

PART VII. TEMPORARY VENTURES AND PARTICIPATION VENTURES

(ARTICLES 138 TO 140)

Article 138

A temporary venture is an association whose corporate purpose are to engage, without an appellation, in one or more specific mercantile transactions. The members are bound jointly and severally towards third parties with whom they have dealt.

Article 139

A participation venture is an association by which one or more persons acquire an interest in transactions that one or more other persons manage in their own name. The managers are bound jointly and severally towards third parties with whom they have dealt.

Article 140

Temporary ventures and participation ventures are effected among the members for the purpose, in the forms, with the proportions of interest and under the terms agreed among them.

PART VIII. THE LIQUIDATION OF ENTITIES (ARTICLES 141 TO 151)

Article 141

(supplemented by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) After their dissolution, commercial companies are deemed to exist for the purposes of their liquidation. A European company (SE) having its statutory registered office in the Grand Duchy of Luxembourg is subject to the rules applying to public limited liability companies. All documents emanating from a dissolved company shall state that it is in liquidation.

Article 142

supplemented by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) Unless agreed to the contrary, the method of liquidation is fixed and the liquidators appointed by the members in general meeting. Where there exist two or more classes of shares in public limited liability companies and partnerships limited by shares and the deliberations of the general meeting are such as to amend their respective rights, the deliberations must, in order to be valid, fulfil the presence and majority requirements set down by article 67-1 in respect of each class. In general partnerships and private limited liability companies, decisions are only validly taken with the assent of one-half of the members possessing threequarters of the corporate assets; failing that majority, rulings are made by the courts. In limited partnerships, failing stipulations to the contrary contained in the deed of partnership, decisions are only validly taken with the assent of members representing three-quarters of the ownership interests.

Where there are two or more liquidators, they form a collective body that deliberates according to the method set down in Article 64. The liquidation of a special purpose limited partnership is effected in accordance with the procedures laid down in the deed of partnership, failing which according to the rules applicable to the liquidation of limited partnerships. Articles 1865, 3°, 4° and 5°, and 1869 of the Civil Code do not apply to either limited partnerships or special purpose limited partnerships.

Article 143

(amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2784)) If no liquidators are appointed, the member-managers of general or limited partnerships, the managers of private limited liability companies and the directors or members of the board of management, as the case may be, of public limited liability companies and cooperative companies, are regarded as liquidators in dealings with third parties.

Article 144

Unless otherwise provided in the articles of association or instrument of appointment, the liquidators may raise and sustain all court actions for the entity, receive all payments, grant release with or without receipt, realise all the entity’s movable property, endorse all commercial paper, and settle or compromise on all disputes. They may alienate the entity’s immovable property by public auction if they deem the sale necessary to pay the entity’s debts or if the members number seven or more.

Article 145

They may, albeit only with the authorisation of the general meeting of members given in accordance with Article 142, continue until realisation the industry or commerce of the entity, borrow to pay the entity’s debts, issue commercial paper, mortgage the entity’s assets, pledge them, dispose of its immovable property, even by private bargain, and contribute the business assets to other entities.

Article 146

The liquidators may demand payment from the members of sums they have committed to pay into the entity and that the liquidators judge necessary for settlement of the liquidation.

Article 147

The liquidators shall, without prejudice to the rights of preferred and mortgage creditors, pay all the debts of the entity proportionally and without distinction among the due and payable and non-due and payable debts, under deduction of the discount for the latter. They may nonetheless, under their personal guarantee, first pay the due and payable claims if the assets notably exceed the liabilities or the future claims have a sufficient guarantee and without prejudice to the creditors’ right to raise court proceedings.

Article 148

After payment or consignment of the sums necessary for paying the debts, the liquidators shall distribute to the members the sums or assets that can constitute equal distributions; they shall remit to them the goods that should have been retained for sharing. They may, provided they have the authorisation referred to in Article 145, repurchase the shares of the company at the Stock Exchange, either by subscription or submission, in which all the members would be allowed to participate.

Article 148bis

(inserted by the Act of 20 June 1930 (Official Gazette A31 of 05/07/1930 p. 617), supplemented by the Act of 2 April 1948 (Official Gazette A22 of 08/04/1968 p. 498), amended by the Act of 8 August 1985 (Official Gazette A49 of 28/08/1985 p. 931)) By derogation from the provisions of Article 147 and the first paragraph of Article 148, where a public limited liability company has made a contribution of its entire assets and liabilities situation to another public limited liability company, the liquidators of the contributing company may according to the case, in accordance with articles 26-1 and 44 of this act, divide up among the shareholders the shares that shall have been allotted in remuneration for the contribution, without first having to reimburse the bonds or consign the sums necessary for that reimbursement, whereby the company receiving the contribution shall be bound directly for executing the bonds of the contributing company in the same manner as it was bound, whereby all special guarantees are maintained in favour of the bond holders.

The company receiving the contribution and that which has made it shall be of Luxembourg nationality unless the laws of the country of the contributing company allow the contribution to made under the relevant conditions, even to a foreign company. In the event that the entire assets and liabilities situation of a public limited liability company is taken over by the State, it may acquire the shareholders’ interests without having to first repay the bond holders or consign the sums necessary for such reimbursement.

Article 148ter

(inserted by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) By derogation from the provisions of Article 147 and the first paragraph of Article 148, where the shareholders or members of a commercial company endowed with legal personality unanimously decide to continue their association within a special purpose limited partnership that is to take over the entire assets and liabilities situation, the liquidators may divide up among the shareholders or members the ownership interest in the special purpose limited partnership without having to first repay the bond holders or consign the sums necessary for such reimbursement, whereby the special purpose limited partnership shall be bound directly for executing the bonds of the commercial company in the same manner as it was bound, whereby all special guarantees are maintained in favour of the creditors.

Article 149

The liquidators are liable towards both third parties and the entity for performance of their mandate and faults committed in their management.

Article 150

Each year, the results of the liquidation are submitted to the entity’s general meeting, specifying the causes that have prevented termination of the liquidation. In public limited liability companies, the balance sheet is moreover published.

Article 151

(supplemented by the Act of 31 May 1999 (Official Gazette A77 of 21/06/1999 p. 1681), amended by the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295)) When the liquidation is terminated, the liquidators report to the general meeting on application of the entity’s assets and submit the financial statements and supporting records. The meeting appoints the statutory auditors to examine these documents and fixes a new meeting at which a decision is adopted, following the report by the statutory auditors, on the liquidators’ management. The statutory auditors need not qualify as accredited company auditors except for entities that exceed two of the three criteria laid down in article 35 of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings and amending certain other statutory provisions and for entities that have exceeded the limits set down in article 35 during the three last years preceding the date the entity was put into liquidation.

Notice of closure of the liquidation will be published in accordance with Article 9. This notice shall also comprise:

1) particulars of the place designated by the general meeting where the books and records of the entity will be lodged and retained for at least five years;

2) particulars of the measures taken with a view to consignment of the sums and assets due to the creditors or members and which it has not been possible to remit to them.

PART IX. COURT ACTIONS AND PRESCRIPTION PERIODS (ARTICLES 152 TO 157)

Article 152

(amended by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) No judgment founded on commitments of the entity may be handed down pursuant to which an order is made personally against the jointly and severally liable members of a general partnership, ordinary limited partnership, special purpose limited partnership, partnership limited by shares or unlimited liability cooperative company until an order has been made against the entity.

Article 153

(amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Creditors of all entities may petition for a court order for the payments stipulated in the articles of association that are necessary in order to conserve their rights; the entity may have the action dismissed by repaying their claims at value, after deduction of the discount. The managers, directors or members of the board of management, as the case may be, are personally bound to execute judgments rendered on this count. Creditors may, pursuant to Article 1166 of the Civil Code, enforce against the members or shareholders the entity’s rights in terms of the payments to be made and that are due pursuant nto the articles of association, decisions of the entity or judgments.

Article 154

(amended by the Act of 11 August 1996 (Official Gazette A53 of 20/08/1996 p. 1660)) The local court sitting in commercial matters may, in exceptional circumstances, on a petition by shareholders and members owning one-fifth of the ownership interests served with a citation against the entity, appoint one or more statutory auditors with the assignment of verifying the books and financial statements of the entity. It hears the parties in judge’s chambers and rules in a public hearing. The judgment shall set forth the matters on which the investigation shall be effected and shall set the prior consignment to be made for payment of the costs; these costs may be included in those for the proceeding to which the facts as found might give rise. The report shall be lodged at the court registry.

Article 155

Members of temporary venturers shall be cited directly and individually. There is no direct right of action between third parties and a participant who has bound himself under the terms of a simple participation.

Article 156

Actions against entities prescribe after the same periods as actions against private individuals.

Article 157

(amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), supplemented by the Act of 12 July 2013 (Official Gazette A119 of 15/07/2013 p. 1856)) There is a five-year prescription period for:

– all third-party actions against the members or shareholders as from publication of either their withdrawal from the entity or an act of dissolution, or the expiry of its term;

– all third-party actions for the return of dividends unduly distributed, as from the distribution;

– all actions against liquidators, acting in that capacity, as from the publication required by Article 151;

– all actions against managers, directors, members of the board of management, members of the supervisory board, statutory auditors or liquidators, for acts in office, as from such acts or, if dissimulated by fraud, as from the discovery thereof;

– all actions to for the voidance of a public limited liability company, private limited liability company or partnership limited by shares founded on article 12ter, first paragraph, 1° and 2°, as from publication, where the contract has been performed for five years or more, without prejudice to any damages that might be due;

– all actions for the voidance of a cooperative company as from publication where the contract has been performed for five years or more, without prejudice to any damages that might be due. However, the setting-aside of cooperative companies whose existence is contrary to law may be petitioned for even after expiry of the prescription period;

– all actions for the voidance of an ordinary limited partnership or a special purpose limited partnership founded, respectively on article 16, subarticle (7), or on article 22-1, eighth paragraph, as from publication, where the contract has been performed for five years or more, without prejudice to any damages that might be due.

PART X. ENTITIES INCORPORATED ABROAD (ARTICLES 158 TO 160-11)

Article 158

All companies and associations incorporated or having their registered office in a foreign country may engage in operations and act as parties in litigation in the Grand Duchy.

Article 159

(supplemented by the Act of 31 May 1999 (Official Gazette A77 of 21/06/1999 p. 1681), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Any company whose central administration is situated in the Grand Duchy is subject to Luxembourg law, even if the instrument of incorporation has been executed in a foreign country. Where a company has its domicile in the Grand Duchy of Luxembourg, it possesses Luxembourg nationality and Luxembourg law is applied to it in full. Where a company has its domicile abroad but it has one or more places of business of any kind in the Grand Duchy of Luxembourg, the most important place of establishment in the Grand Duchy of Luxembourg as specified to that effect in the publication of its acts as required by law constitutes the secondary domicile of that entity in the Grand Duchy of Luxembourg.

Failure for a company to have a known domicile constitutes a serious offence under the law, liable to entail dissolution or judicial closure according to the terms of articles 203 and 203-1.

Article 160

The articles relative to the publication of acts and balance sheets and articles 76, 105 and 130 are applicable to foreign commercial companies or foreign companies constituted in the forms of commercial companies that establish a branch or any place of business in the Grand Duchy. The persons appointed to manage the Luxembourg establishment are subject to the same liability towards third parties as if they managed a Luxembourg company. The articles referred to in the first paragraph also apply to foreign entities that have a branch or place of business in the Grand Duchy at the time this act comes into force.

Article 160-1

(inserted by the Act of 27 November 1992 (Official Gazette A95 of 15/12/1992 p. 2625)) For entities falling under articles 160-2 and 160-6, article 160, first paragraph, is replaced by articles 160-2 to 160-11.

Article 160-2

(inserted by the Act of 27 November 1992 (Official Gazette A95 of 15/12/1992 p. 2625)) Branches created in the Grand Duchy of Luxembourg by companies that fall under the law of another Member State of the European Communities and to which Directive 68/151/EEC of 9 March 1968 applies are required to publish the following acts and information according to the terms of article 9:

a) the address of the branch;

b) information on the business activities of the branch;

c) the register at which the file referred to in article 3 of Directive 68/151/EEC has been opened for the company and the company’s registration number in that register;

d) the name and form of the company, together with the name of the branch if it differs from that of the company;

e) the appointment, termination of office and particulars of the person: authorised to represent the company in dealings with third parties and in legal proceedings:

– as an organ of the entity provided for by law or members of such an organ, in conformity with the disclosure intimated on the company according to article 2 paragraph 1, point (d), of Directive 68/151/EEC;

– as permanent representatives of the company for the branch’s business activities, with particulars of the ambit of their powers;

f) – the dissolution of the company, the appointment, particulars and powers of the liquidators, as well as termination of the liquidation, in conformity with the disclosure on the company according to article 2, paragraph 1, points (h), (j) and (k), of Directive 68/151/EEC;

– – any bankruptcy, creditors’ arrangement or other, similar procedure to which the company is subject;

g) the accounting documents according to the terms set down in article 160-3;

h) closure of the branch.

Article 160-3

(inserted by the Act of 27 November 1992 (Official Gazette A95 of 15/12/1992 p. 2625), amended by the Act of 23 March 2007 Official Gazette A46 of 30/03/2007 p. 816)) The disclosure obligation referred to in article 160-2, point (g), concerns only the accounting documents of the company as drawn up, audited and published according to the law of the Member State that the company falls under, in accordance with Directives 78/660/EEC, 83/349/EEC and 84/253/EEC. The accounting documents referred to in the preceding paragraph must be published in one of the following languages: French, German, English.

Article 160-4

(inserted by the Act of 27 November 1992 (Official Gazette A95 of 15/12/1992 p. 2625), amended by the Act of 19 December 2002 (Official Gazette A149 of 31/12/2002 p. 3652)) Where there exist two or more branches created by the same company in the Grand Duchy of Luxembourg, the disclosure referred to in article 160-3 may be effected at the register of one of those branches, at the company’s choice. In that case, the disclosure obligation of the other branches concerns that branch’s registration number in that register.

Article 160-5

(inserted by the Act of 27 November 1992 (Official Gazette A95 of 15/12/1992 p. 2625)) In addition to the particulars required by article 4 of Directive 68/151/EEC, letters and order forms used by the branch must bear particulars of the register at which the branch’s file is held together with its registration number in that register.

Article 160-6

(inserted by the Act of 27 November 1992 (Official Gazette A95 of 15/12/1992 p. 2625)) Branches created in the Grand Duchy of Luxembourg by entities that do not fall under the law of a Member State of the European Communities but that are in a legal form comparable to those referred to in Directive 68/151/EEC are required to publish the following deeds and particulars in accordance with the procedures of article 9:

a) the address of the branch;

b) particulars of the branch’s activities;

c) the law of the State under which the entity falls;

d) if provided for by that law, the register in which the entity is registered and its registration number in that register;

e) the instrument of formation and the articles of association, if the latter form a separate instrument, together with any amendment to those documents;

f) the form, registered office and purpose of the entity, plus, at least once annually, the amount of the subscribed capital, unless those particulars figure in the documents referred to in point e);

g) the name of the entity together with the name of the branch, if different from that of the entity;

h) the appointment, termination of office and particulars of the persons with power to bind the entity vis-à-vis third parties and represent it in legal procedures:

– as an organ of the entity provided for by law or members of such an organ;

– as permanent representatives of the entity for the branch’s activities.

It is necessary to state the ambit of those persons’ powers if they can exercise them alone or must do so jointly.

i) – the dissolution of the entity and the appointment, particulars and powers of the liquidators, and termination of the liquidation;

– any bankruptcy, creditors’ arrangement or other, similar procedure to which the company is subject;

j) the accounting documents according to the terms laid down in article 160-7;

k) closure of the branch.

Article 160-7

(inserted by the Act of 27 November 1992 (Official Gazette A95 of 15/12/1992 p. 2625, amended by the Act of 19 December 2002 (Official Gazette A149 of 31/12/2002 p. 3654), the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295)) The disclosure obligation referred to in article 160-6, point j), concerns the accounting documents of the entity as drawn up, audited and published according to the law of the State that the company falls under.

Where these documents are not drawn up in conformity with Directives 78/660/EEC and 83/349/EEC or in an equivalent manner, it is necessary to draw up the accounting documents relative to the branch’s activities and publish them in accordance with Luxembourg law. Where the branch exceeds the criteria for a small company, as such criteria are set down in article 35 of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings, it is required that the accounting documents be audited by one or more accredited company auditors. Article 36 of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings is also applicable. Designation of the accredited company auditor or auditors is incumbent on the person appointed to manage the branch.

Articles 160-3, second paragraph, and 160-4 apply to both the documents referred to in article 160-7, first paragraph, and the documents referred to in article 160-6, point e). Where these documents are not drawn up in conformity with Directives 78/660/EEC and 83/349/EEC or in an equivalent manner, it is necessary to draw up the accounting documents relative to the branch’s activities and publish them in accordance with Luxembourg law. Where the branch exceeds the criteria for a small company, as such criteria are set down in article 35 of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings, it is obligatory for the accounting documents to be audited by one or more accredited company auditors. Article 36 of the Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings is also applicable.

Article 160-8

(inserted by the Act of 27 November 1992 (Official Gazette A95 of 15/12/1992 p. 2625)) Article 160-5 applies to letters and order forms used by branches falling under article 160-6.

Article 160-9

(inserted by the Act of 27 November 1992 (Official Gazette A95 of 15/12/1992 p. 2625)) Persons appointed to manage Luxembourg branches require to complete the formalities laid down by articles 160-2 to 160-8.

Article 160-10

(inserted by the Act of 27 November 1992 (Official Gazette A95 of 15/12/1992 p. 2625)) Where the disclosure relative to the branch differs from the disclosure relative to the entity, the former prevails for transactions effected with the branch.

Article 160-11

(inserted by the Act of 27 November 1992 (Official Gazette A95 of 15/12/1992 p. 2625)) Articles 160-3, first paragraph, and 160-7, first and second paragraphs, do not apply to Luxembourg branches created by credit institutions and financial institutions falling under Directive 89/117/EEC. The same applies to branches created by foreign insurance companies.

Article 161

(amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), the Act of 16 May 1975 (Official Gazette A29 of 26/05/1975 p. 652), repealed by the Act of 10 July 2005 (Official Gazette A98 of 12/07/2005 p. 1748))

PART XI. CRIMINAL PROVISIONS (ARTICLES 162 TO 173BIS)

Article 162

(amended by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), the Act of 13 June 1994 (Official Gazette A59 of 07/07/1994 p. 1096)) A fine of between 500 and 25,000 euros shall be imposed on any person purporting to own shares or bonds that do not belong to him and taking part in a ballot at a general meeting of shareholders or bond holders within an entity constituted under the aegis of this act and on any person handing over shares or bonds for the purpose referred to above.

Article 163

(supplemented by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), replaced by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), supplemented by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), amended by the Act of 4 May 1984 (Official Gazette A40 of 10/05/1984 p. 586), the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), the Act of 8 March 1989 (Official Gazette A14 of 17/03/1989 p. 176), supplemented by the Act of 27 November 1992 (Official Gazette A95 of 15/12/1992 p. 2625), amended by the Act of 28 December 1992 (Official Gazette A106 of 30/12/1992 p. 3141), the Act of 2 December 1993 (Official Gazette A94 of 12/12/1993 p. 1740), the Act of 19 December 2002 (Official Gazette A149 of 31/12/2002 p. 3654), the Act of 10 July 2005 (Official Gazette A98 of 12/07/2005 p. 1748), the Act of 10 July 2005 (Official Gazette A98 of 12/07/2005 p. 1748), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 816)) The same penalty shall be imposed on:

1) any person failing to state the details required by articles 26, 27, 29 and 31 in instruments, draft corporate instruments or notices published in the Official Gazette C, Digest of Companies and Associations or lodged in accordance with article 9, in subscriptions, prospectuses, circulars addressed to the general public, in posters and announcements published in newspapers.

2) managers or directors failing to submit to the general meeting within six months of the closing of the financial year the financial statements, consolidated financial statements, management report and certificate of the person charged with the audit engagement, as well as managers or directors failing to procure publication of those documents in breach of the respective requirements of articles 75, 132, 197 and 341 of this act and article 79 of the Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings;

3) directors, statutory auditors or liquidators who fail to call the general meeting provided for in article 70, second paragraph, within three weeks of their being demanded to do so;

4) any person contravening the regulations passed in pursuance of article 137, first paragraph, on the audit of cooperative companies;

5) managers of private limited liability companies and of non-commercial companies and, in the latter case, in the absence of managers, members failing to procure publication of changes arising regarding the identity of the members in accordance with article 11bis, §2, 3);

6) managers who, directly or through an intermediary, open a public subscription procedure for shares or bonds of a private limited liability company;

7) directors of public limited liability companies failing to present the report referred to in article 49-5, subarticle (2), or presenting a report not containing the minimum particulars required by that article;

8) any person falling under article 160-9 that fails to complete the disclosure formalities laid down in articles 160-2 to 160-4, 160-6 or 160-7.

Article 164

Any person shall be deemed guilty of embezzlement and penalised according to the penalties laid down by the Criminal Code where he causes subscriptions or payments or causes purchases of shares, bonds or other corporate securities:

– by the simulation of subscriptions or payments to a company;

– by the publication of subscriptions or payments that he knows are non-existent;

– by the publication of names of persons designated as being or to be attached to the company in any capacity whatsoever where he knows that such designations are contrary to the truth;

– by the publication of any other facts that he knows to be false.

Article 165

(amended by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), the Act of 13 June 1994 (Official Gazette A59 of 07/07/1994 p. 1096)) A term of imprisonment of between one month and two years and a fine of between 5,000 and 125,000 euros shall be imposed on any person who, by any fraudulent means whatsoever, procures or attempts to procure a rise or drop in the price of shares, bonds or other corporate securities.

Article 166

(replaced by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), supplemented by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), amended by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), the Act of 2 December 1993 (Official Gazette A94 of 12/12/1993 p. 1740), the Act of 10 July 2005 (Official Gazette A98 of 12/07/2005 p. 1748), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) A term of imprisonment of between one month and two years and a fine of between 5,000 and 125,000 euros or one of such penalties shall be imposed on:

1) managers or directors who fraudulently made inaccurate statements in the statement of bonds in circulation referred to in article 94-1;

2) managers or directors who, with fraudulent intent, failed to procure publication of the financial statements, consolidated financial statements, management report and certificate of the person charged with the audit engagement, according to articles 75, 132 and 341 and according to article 79 of the Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings.

3) 4° directors contravening article 26-4.

Article 167

(amended by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872)) The same penalty shall be imposed on managers or directors who, in the absence of inventories, despite inventories or by means of fraudulent inventories, effected distribution to the shareholders of dividends or interest not drawn against true profits as well as directors contravening the provisions of article 72-2.

Article 168

(amended by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), supplemented by the Act of 12 March 1998 (Official Gazette A24 of 31/03/1998 p. 356)) The same penalty shall be imposed on any person who, as a director, statutory auditor, manager or member of the supervisory committee, knowingly:

– redeems shares by reducing the share capital or legally obligatory reserve, contrary to the provisions of article 49-2 in the case of public limited liability companies,

– makes loans or advances using corporate funds over shares or ownership interests of the company, contrary to articles 49-6 and 49-7 in the case of public limited liability companies;

– orders, authorises or agrees that another company as defined in article 49bis subarticle (1), paragraphs a) and b), should subscribe, acquire or hold shares under the terms set down by the provisions of paragraphs a) and b) of subarticle (1) of article 49bis, in breach of article 49-2;

– effects by any means, at the company’s expense, payments for shares or admits as effected payments not actually made in the manner and at the times as required.

Article 169

(amended by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), the Act of 13 June 1994 (Official Gazette A59 of 07/07/1994 p. 1096)) A penalty of penal servitude of between five years and ten years and a fine of between 5,000 and 250,000 euros shall be imposed on any person committing forgery, with fraudulent intent or the aim of causing harm, in the balance sheets or in the profit and loss accounts of companies that are required by law or by the articles of association, either:

– by means of false signatures, or

– by the forgery of or tampering with entries or signatures, or

– by the fabrication of agreements, provisions, obligations or discharges, or by the ulterior insertion thereof in balance sheets or profit and loss accounts, or

– by the addition of or tampering with clauses, statements or facts that those deeds are intended to contain and form a record of.

Article 170

Any person uttering such false deeds shall be punished as if he were the perpetrator of the forgery.

Article 171

For the purposes of the foregoing provisions, the balance sheet exists as from the time it is submitted for inspection by the shareholders or members.

Article 171-1

(inserted by the Act of 21 July 1992 (Official Gazette A58 of 10/08/1898 p. 1898), the Act of 13 June 1994 (Official Gazette A59 of 07/07/1994 p. 1096)) A penalty of imprisonment of between one year and five years and a fine of between 500 and 25,000 euros or one of such penalties shall be imposed on de facto or de iure company officers who, acting in bad faith,

– make use of the property or credit of the company that they know to be contrary to its interests for personal purposes or to favour another company or undertaking in which they have a direct or indirect interest;

– make use of powers they possess or votes at their disposal in that capacity, that they know to be contrary to the company’s interests for personal purposes or to favour another company or undertaking in which they have a direct or indirect interest.

Article 171-2

(1) A fine of 5,000 euros to 125,000 euros shall be imposed on managers or directors who knowingly:

1) fail to keep a register of registered shares according to the provisions of article 39;

2) fail to designate a custodian or fail to deposit bearer shares with that custodian according to the provisions of article 42;

3) acknowledge the rights attaching to bearer shares in breach of the provisions of article 42, subarticle (5).

(2) A fine of 500 euros to 25,000 euros is imposed on the custodian or, in the case of a legal person, the managers or the directors of the custodian that knowingly breach(es) the provisions of article 42, subarticles (3), (4) and (6).

Article 172

The provisions of Book 1 of the Criminal Code and of articles 130-1 to 132-1 of the Criminal Investigation Code, are deemed applicable to the offences laid down by this act.

Article 173

(amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) Evidence of allegations directed on the basis of acts and omissions relative to their management or supervision duties against the managers, the directors and statutory auditors of ordinary limited partnerships or partnerships limited by shares, public limited liability companies and cooperative companies shall be admitted whether against such persons or against the entity by all ordinary means, excepting counter-evidence by the same means, in accordance with the Act of 8 June 2004 on the freedom of expression in the media.

Article 173bis

(inserted by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The penalties laid down by articles 162 to 173 are applicable, according to their respective remits, to the members of the board of management and the members of the supervisory board of public limited liability companies governed by the provisions of articles 60bis-1 to 60bis-19.

ADDITIONAL PROVISIONS (ARTICLES 174 TO 178)

Article 174

Title III of book 1er of the Commercial Code, in so far as not repealed pursuant to the Act of 16 April 1879, is repealed as of the date on which this act comes into force.

Article 175

(amended by the Act of 10 July 2005 (Official Gazette A98 of 12/07/2005 p. 1748)) The provisions of articles 11, 39 to 42, 48, 62, 63, 67 to 69, 71, 72 to 75, 76, 78 and 84 apply to entities constituted under the aegis of previous legislation, with the exception of the last paragraph of article 85 and article 152. – This list is not limitative.

Articles 86 to 95 inclusive do not apply to bonds issued prior to the coming into force of this act unless what is concerned is the grant of special securities to holders of such bonds and the adoption of the provisions resulting therefrom. Article 98 does not apply to bonds issued prior to the coming into force of this act. The five-year prescription period laid down by article 157 applies even to facts effected under the aegis of the previous law for which more than five additional years would be needed for the prescription period to be completed in terms of that law.

Article 176

Both commercial companies and non-commercial companies incorporated in the form of one of the five commercial companies provided for in article 3 and existing prior to the coming into force of this act may not be continued beyond the period fixed for their term unless all clauses of their articles of association that might be contrary thereto are deleted and they submit to all of its provisions. Prior to the expiry of that term, they may only make amendments to their articles of association by bringing the clauses to which such amendments relate in line with the provisions of this act. If, in that case, what is concerned is a public limited liability company, it will only be relieved of the requirement for government authorisation if it proceeds as set forth in the first paragraph.

Public limited liability companies holding licences for railways or other works of public utility shall continue in all events to be subject to the audit or supervision measures laid down in their current articles of association.

Article 177

Entities that, following the coming into force of this act, shall have duly operated for one year without their validity being challenged may no longer be declared void pursuant to articles 42 and 46 of the Commercial Code of 1807.

Article 178

The powers, subscription forms and receipts bearing a private signature and provided for by this act are free from stamp duty.

PART XII. PRIVATE-LIMITED LIABILITY COMPANIES

(ARTICLES 179 TO 202) (inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749))

Article 179 (inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), supplemented by the Act of 28 December 1992 (Official Gazette A106 of 30/12/1992 p. 3141))

(1) Private limited liability companies are those in which a limited number of members commit themselves up to a certain amount and whose shares, which are represented exclusively by non-negotiable securities, can only be transferred according to the procedures and terms laid down in this article.

(2) A private limited liability company may have a sole member upon being incorporated and in the event that all its shares come to be held by a single person (one-man company). If all the shares come to be held by a single person, this does not entail the dissolution of the company. Likewise, the death of the sole member does not entail the company’s dissolution.

Article 180

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749)) They may be incorporated for any purpose. However, insurance, capitalisation and savings companies may not adopt this form.

Article 180-1

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792)) Private limited liability companies may be incorporated for a limited term or in perpetuity. In the first case, the company’s term may be successively extended under the terms of article 199. In the second case, articles 1865, 5°, and 1869 of the Civil Code shall not apply. However, the court may be petitioned for the company’s dissolution if there is just cause. Apart from judicial dissolution, the company may only be dissolved by resolution taken by the general meeting under the forms set down for amendments to the articles of association.

Article 181

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), amended by the Act of 18 April 1984 (Official Gazette A51 of 07/06/1984 p. 766), the Act of 28 December 1992 (Official Gazette A106 of 30/12/1992 p. 3141)) The number of members is limited to 40, except that this figure may be exceeded in the case of transfers of shares upon death or dissolution of a matrimonial community of property.

Spouses may validly act as members in companies incorporated in the form of private limited liability companies on condition that the articles of association do not alter the effects of the matrimonial property regime between the spouses. In that case, the company may even be formed by the husband and wife as the only members. The guardian of a minor or major ward may not act on behalf of the minor or major ward in a private limited liability company without the authorisation of the family council. The statutory administrators may not, even jointly, allocate the property of the minor to a holding in a private limited liability company without the authorisation of the guardianships court. A company in which the minor and major ward and the persons with authority over them, respectively, have a holding is lawful.

Article 182

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), amended by the Act of 28 April 1988 (Official Gazette A24 of 27/05/1988 p. 516), the Act of 10 December 1998 (Official Gazette A105 of 17/12/1998 p. 2516), the Act of 1 August 2001 (Official Gazette A117 of 18/09/2001 p. 2440), the Act of 21 December 2006 (Official Gazette A228 of 27/12/2006 p. 4070)) The share capital of the company must amount to at least 12,394.68 euros. It is divided into shares of equal value, with or without mention of value.

Article 183

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), amended by the Act of 24 April 1983 (Official Gazette A35 of 16/05/1983 p. 864), the Act of 28 December 1992 (Official Gazette A106 of 30/12/1992 p. 3141)) Incorporation of a private limited liability company requires:

1) […]

2) that the share capital be subscribed in full;

3) that the shares be fully paid up at the time the company is incorporated.

The subscribers to the deed of incorporation shall be deemed the founders of the company. However, the deed of incorporation may designate as founder one or more subscribers possessing together at least one third of the company’s share capital. In that case, the other parties to the deed who merely subscribe to shares in return for cash without receiving any particular direct or indirect advantage shall be deemed simple subscribers.

Article 184

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), the Act of 28 April 1988 (Official Gazette A24 of 27/05/1988 p. 516), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295)) The provisions of article 27 apply to private limited liability companies, subject to those relating to share capital and the involvement of an accredited company auditor in the specification of contributions other than in cash.

The founders within the meaning of article 28, second paragraph, and, in the case of an increase in the share capital, the managers, are jointly and severally liable to the interested parties in spite of any stipulation to the contrary:

1) for every portion of the capital that might not be validly subscribed and for the difference between the minimum share capital required under article 182 and the amount of the subscriptions; they are deemed ipso iure to be subscribers thereof;

2) for the actual paying-up of the shares and for the portion of capital they are deemed to subscribe to by dint of the provisions under 1°;

3) for compensation of the damage that is an immediate, direct consequence either of the company being declared void by application of article 12ter or of the absence or falsity of the statements required by article 27. Any person undertaking a commitment for a third party designated by name in the deed, whether as agent or under a covenant, is deemed personally liable if there is no valid agency or if the commitment is not ratified within two months of its being stipulated. The founders are bound under such commitments jointly and severally.

Article 185

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749)) Without prejudice to the obligations resulting from article II [i.e. of the Act of 18 September 1933], each private limited liability company must keep a register containing full, true copies of:

1) the company’s deed of incorporation;

2) deeds making amendments to that deed.

After these shall be narrated the names, occupations and addresses of the members, mentions of share transfers and the date of notification of acceptance. Any member may inspect this register.

Article 186

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), amended by the Act of 28 December 1992 (Official Gazette A106 of 30/12/1992 p. 3141)) A private limited liability company is either named with a particular name or by designation of the corporate purpose of its business or designated under an appellation comprising the names of one or more members.

Article 25, second and third paragraphs, applies to it. […]

Article 187

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586), supplemented by the Act of 28 April 1988 (Official Gazette A24 of 27/05/1988 p. 516), amended by the Act of 19 December 2002 (Official Gazette A149 of 31/12/2002 p. 3652)) All deeds, invoices, announcements, publications, letters, order forms and other documents emanating from private limited liability companies must contain:

1) the company’s name;

2) the words “société à responsabilité limitée”, reproduced in a legible fashion and in full;

3) precise particulars of the registered office;

4) the words “Registre de commerce et des sociétés, Luxembourg” or the initials “R.C.S. Luxembourg” followed by the company’s registration number;

5) the amount of the company’s share capital. Articles 76, second and third paragraphs, 77 and 78 apply to them.

Article 188

(inserted by the Act of 18 December 1933 (Official Gazette A48 of 02/10/1933 p. 749)) No borrowing may be contracted by way of a public bond issue nor may there be a public issue of shares. The shares may not be represented by negotiable securities in registered or bearer form or to order, but only by participation certificates issued to a given person. They may only be transferred under the substantive and formal conditions laid down in the following two articles.

Article 189

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749)) Shares may only be transferred inter vivos to non-members with approval given in general meeting by members representing at least three-quarters of the company’s share capital. Shares may only be transferred upon death to non-members with the approval of owners of shares representing three-quarters of the rights belonging to the survivors. In the case of the second paragraph, consent is not required where the shares are transferred either to heirs entitled to reserved portions or to a surviving spouse and, provided such is provided by the articles of association, the other statutory heirs.

Heirs or beneficiaries under testamentary or contractual dispositions who have not been approved and have not found a transferee meeting the requisite conditions may cause the early dissolution of the company three months after a formal notice served on the managers by court officer and served on the members by recorded delivery post.

However, during the said three-month period, the deceased’s shares may be acquired either by the members, subject to the requirement of the last sentence in article 199, or by a third party approved by them or by the company itself where it meets the conditions laid down for acquisition by a company of its own securities. The repurchase price of the shares is calculated on the basis of the average balance sheet total for the three preceding years and, if the company has not operated for three accounting periods, on the basis of the balance sheet of the preceding year or those of the two preceding years.

If no profit has been distributed or if no agreement is reached on how the bases for repurchase set forth in the preceding paragraph should apply, the price will be fixed by the courts in a case of disagreement. Exercise of the rights attaching to the deceased’s shares is suspended until transfer of those rights is binding as against the company.

Article 190

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), amended by the Act of 28 December 1992 (Official Gazette A106 of 30/12/1992 p. 3141), the Act of 21 December 1994 (Official Gazette A124 of 31/12/1994 p. 3066)) Share transfers must be recorded in a notarial or private seal deed. They are not binding as against the company and third parties until they have been notified to the company or accepted by it in accordance with the provisions of article 1690 of the Civil Code.

Article 191

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749), amended by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586)) Private limited liability companies are managed by one or more representatives, who need not be members and may be salaried or otherwise. They are appointed by the members either in the articles of association or in a subsequent deed, for a fixed term or on an open-ended basis. Unless otherwise provided in the articles of association, they cannot be recalled, regardless of how they are appointed, except for just cause.

Article 191bis

(inserted by the Act of 23 November 1972 (Official Gazette A72 of 13/12/1972 p. 1586)) Unless otherwise provided in the articles of association, each manager may engage in all acts necessary or expedient for achieving the company’s purpose, apart from those that by law are the preserve of the members. Each manager represents the company vis-à-vis third parties and in legal procedures, as plaintiff or defendant.

Writs for or against the company are validly served in the name of the company alone. Restrictions imposed on the managers’ powers by the articles of association are not binding as against third parties, even if they are published. However, the articles of association may confer authority on one or more managers to represent the company alone or together, and that clause is binding as against third parties under the conditions set forth in article 9. The company is bound by acts carried out by the managers even if those acts are ultra vires unless it prove that the third party knew, or in the circumstances could not have been unaware, that the act was ultra vires, albeit publication alone of the articles of association shall not be sufficient to constitute such proof.

Article 192

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749)) The managers are liable according to Article 59.

Article 193

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749)) The decisions of the members are adopted at general meetings. However, it is not obligatory to hold general meetings if the number of members does not exceed twenty-five. In that case, each member shall receive the specifically formulated wording of resolutions or decision to be taken and shall cast his vote in writing.

Article 194

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749)) No decision is validly taken in the two cases provided for in the preceding article unless it is adopted by members representing more than one-half of the company’s share capital. Unless otherwise provided in the articles of association, if this figure is not reached at the first meeting or in the first written consultation, the members are called to a second meeting or are consulted a second time, by recorded delivery post, and the decisions are taken by a majority of the votes cast, regardless of the portion of the capital that is represented.

Article 195

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749)) Notwithstanding any contrary clause in the articles of association, any member may take part in decisions. Each member has as many votes as he owns shares.

Article 196

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749)) In companies with over twenty-five members, each year at least one general meeting must be held at the time laid down by the articles of association. Other meetings may be called at any time by the manager or managers, failing whom by the supervisory board, if there is one, failing whom by members representing more than one-half of the company’s share capital.

Article 197

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749)) Each year, the management must draw up an inventory listing the moveable and immoveable assets and all debts owed to and by the company, with a schedule containing a summary of all its commitments and the debts owed to the company by the managers, statutory auditors and members.

The management draws up the balance sheet and profit and loss account, which must include the requisite depreciation charges. The balance sheet shall make separate mention of the fixed assets, the realisable assets and, on the liabilities side, the company’s debts to itself, the bonds, the mortgaged or pledged debts and debts with no real guarantee. Under the liabilities, it must state the amount of debts in favour of members. Each year, an advance deduction is made from the net profits amounting to at least one twentieth, which is allotted to constitution of a reserve; this advance deduction ceases to be compulsory once the reserve reaches one-tenth of the company’s share capital, but resumes whenever that one-tenth figure is drawn against.

The balance sheet and profit and loss account are submitted for approval by the members, who shall also vote in a special ballot on the quietus to be conferred on the management and statutory auditors, if there are any.

Article 198

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749)) Any member may personally or through an attorney in fact receive intimation at the company’s registered office of the inventory, balance sheet and report by the audit board constituted in accordance with Article 200. In companies with over twenty-five members, this intimation shall only be permitted during the fifteen days preceding that general meeting.

Article 199

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 755)) The members can only change the company’s nationality by means of a unanimous vote. Any other amendment to the articles of association shall, unless otherwise provided, be decided on by a majority of members representing three-quarters of the company’s share capital. However, in no event may the majority require any of the members to increase his unit.

Article 200

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749)) In any private limited liability company comprising over twenty-five members, supervision must be entrusted to one or more statutory auditors, who need not be members. This board is appointed in the articles of association. It is subject to re-election at the intervals laid down in the articles of association. The powers of the members of the audit board and their liability are fixed by Article 62, first and third paragraphs, of the act.

Article 200-1

(inserted by the Act of 28 December 1992 (Official Gazette A106 of 30/12/1992 p. 3141)) Articles 194 to 196 and article 199 do not apply to companies having only one member.

Article 200-2

(inserted by the Act of 28 December 1992 (Official Gazette A106 of 30/12/1992 p. 3141)) A sole member exercises the powers attributed to the members in general meeting. Decisions taken by the sole member in the area falling within the first paragraph are recorded in minutes or set down in writing.

Likewise, contracts entered into between the sole member and the company represented by him are recorded in minutes or set down in writing. This provision does not apply to current operations contracted under ordinary conditions.

Article 201

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749)) Dividends not corresponding to profits actually acquired can be recovered from the members that received them. Recovery actions prescribe five years from the date of the distribution.

Article 202

(inserted by the Act of 18 September 1933 (Official Gazette A48 of 02/10/1933 p. 749)) Unless otherwise provided in the articles of association, the company is not dissolved by the disqualification, bankruptcy, insolvency or death of one of the members. Article 128 applies to private limited liability companies.

PART XIIBIS. THE DISSOLUTION AND JUDICIAL CLOSURE OF COMMERCIAL COMPANIES (ARTICLES 203 TO 203-1)

(heading inserted by the Act of 31 May 1999 (Official Gazette A77 of 21/06/1999 p. 1681))

Article 203

(inserted by the Act of 19 May 1978 (Official Gazette A32 of 13/06/1978 p. 589), replaced by the Act of 31 May 1999 (Official Gazette A77 of 21/06/1999 p. 1681))

(1) The local court sitting in commercial matters may, on a petition by the State Prosecutor, pronounce the dissolution and order the liquidation of any company subject to Luxembourg law that carries on business contrary to the criminal law or that seriously contravenes the provisions of the Commercial Code or the statutes governing commercial companies, including relative to the right of establishment.

(2) The petition and the acts of procedure in the context of this article are served through the offices of the clerk of court. Where the company cannot be reached at its legal address in the Grand Duchy of Luxembourg, the petition is published in extract form in two newspapers printed in the country.

(3) When ordering the liquidation, the court appoints a judge-commissioner and one or more liquidators. It decides the method of liquidation. It may, to the extent it deems fit, make the rules governing bankruptcy liquidation applicable. The method of liquidation may be varied by subsequent order, either ex proprio motu or on a petition by the liquidator or liquidators.

(4) Court orders pronouncing the dissolution and ordering the liquidation of a company are published in extract form in the Official Gazette, C Digest Companies and Associations. The court may furthermore, in addition to the notices to be published in newspapers printed in the country, order their publication in extract form in such foreign newspapers as it designates. Notices are published through the offices of the liquidator or liquidators.

(5) The court may rule that the judgment pronouncing the dissolution and ordering the liquidation be enforceable provisionally.

(6) In the case that there are no or insufficient assets, as determined by the judge commissioner, the costs and fees of the liquidators as arbitrated on by the court are borne by the State and liquidated as judicial costs.

(7) Actions against the liquidators prescribe five years after publication of closure of the liquidation.

Article 203-1

(inserted by the Act of 31 May 1999 (Official Gazette A77 of 21/06/1999 p. 1681), amended by the Act of 1 August 2001 (Official Gazette A117 of 18/09/2001 p. 2440)

(1) The local court sitting in commercial matters may, on a petition by the State Prosecutor, pronounce the closure of any establishment in the Grand Duchy of Luxembourg of a foreign company that carries on business contrary to the criminal law or that seriously contravenes the provisions of the Commercial Code or the statutes governing commercial companies, including relative to the right of establishment.

(2) The petition and the acts of procedure in the context of this article are served through the offices of the clerk of court. Where the company cannot be reached at its legal address in the Grand Duchy of Luxembourg, the petition is published in extract form in two newspapers printed in the country. The court may furthermore order their publication in extract form in such foreign newspapers as it designates.

(3) Court orders pronouncing the closure of the establishment of a foreign company are published in extract form in the Official Gazette, C Digest Companies and Associations. The court may furthermore, in addition to the notices to be published in newspapers printed in the country, order their publication in extract form in such foreign newspapers as it designates. Notices are published through the offices of the State Prosecutor.

(4) Judgments pronouncing the closure of the establishment in the Grand Duchy of a foreign company are enforceable provisionally.

(5) A penalty of imprisonment of between eight days and five years and a fine of between 10,250 and 125,000 euros or one of such penalties shall be imposed on any person breaching a judicial closure order handed down in accordance with this article.

PART XIII. COMPANY FINANCIAL STATEMENTS

(ARTICLES 204 TO 256TER) REPEALED (repealed by the Act of 19 December 2002) (Official Gazette A149 of 31/12/2002 p. 3630) [...]

PART XIV. MERGERS (ARTICLES 257 TO 284)

(heading inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792))

Article 257

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), replaced by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), amended by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268)) This part applies to all companies on which legal personality is conferred under this act and to economic interest groupings.

A merger may also take place where one or more of the companies or economic interest groupings that are absorbed or that disappear are subject to a bankruptcy, creditors’ arrangement or other, similar procedure such as a moratorium, administration or procedure instituting special management or supervision of one or more of those companies or economic interest groupings.

A company or economic interest grouping falling under the first paragraph may also contract a merger transaction with a company or economic interest grouping incorporated under foreign law provided the latter’s national law does not constitute an objection thereto and the latter complies with the provisions and formalities of the national law it falls under, without prejudice to the provisions of article 21 of Regulation (EC) No. 139/2004 of 20 January 2004 on the control of concentrations between undertakings. These mergers are hereinafter referred to as “cross-border mergers”. The provisions and formalities of foreign law referred to in the preceding paragraph particularly concern the decision-making process relative to the merger and, taking account of the cross-border nature of the merger, the protection of the creditors of the merging companies, bond holders and shareholders, as well as the employees in so far as rights other than those governing employees’ co-determination are concerned.

Where one of the merging companies is governed according to a employees’ codetermination regime and the absorbing company resulting from the merger is a company under Luxembourg law governed by such a system in accordance with the rules provided for in articles L.426-13 and L.426-14 of the Labour Code, that company shall require to take the form of a public limited liability company. Where, in the following provisions, reference is made to the “company/ies”, this term shall be construed, unless otherwise particularly indicated, as also including “economic interest grouping(s)”.

Article 258

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792)) A merger is effected by virtue of the absorption of one or more companies by another or the formation of a new company.

Article 259

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), supplemented by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) Merger by absorption is an operation by which one or more companies transfer to another, already existing company, pursuant to dissolution without liquidation, all of their assets and liabilities in return for allotment to the members of the absorbed company or companies of shares in the absorbing company and, possibly, a cash balance not exceeding 10% of the nominal value of the shares allotted or, failing a nominal value, their accounting par.

(2) Merger by absorption may also take place where one or more of the absorbed companies are in liquidation, provided they have not yet started distribution of their assets among their members.

(3) Where a European company (SE) is constituted by means of a merger by absorption, the absorbing company takes the form of a European company (SE) simultaneously with the merger.

Article 260

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), supplemented by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815))

(1) Merger by the formation of a new company is an operation by which two or more companies transfer to a company that they constitute, pursuant to their dissolution without liquidation, all of their assets and liabilities in return for allotment to their members of shares in the new company and, possibly, a cash balance not exceeding 10% of the nominal value of the shares allotted or, failing a nominal value, their accounting par.

(2) Merger by formation of a new company can also take place where one or more of the companies that disappear are in liquidation, provided those companies have not yet started distribution of their assets among their members.

(3) Where a European company (SE) is constituted by means of a merger by formation of a new company, the European company (SE) is the newly constituted company.

Sub-part 1. Merger by absorption (articles 261 to 276)

(heading inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792))

Article 261

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), replaced by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) The administrative or management organs of each of the merging companies prepare a joint merger project in writing.

(2) The joint merger project sets forth:

a) the form, name and registered office of the merging companies and those envisaged for the company to emerge from the merger;

b) the share exchange ratio and the amount of any cash balance;

c) the procedures for delivering the shares of the absorbing company;

d) the date from which those shares confer a right to share in the profits and any particular procedure relative to that right;

e) regardless of what the effective date of the merger is according to articles 272, 273, 273bis and 273ter, the date from when the transactions of the absorbed company are deemed from an accounting viewpoint as carried out for the account of the absorbing company;

f) the rights assured by the absorbing company in favour of the members having special rights and to holders of securities other than shares, or the measures proposed in their regard;

g) any particular advantages attributed to the experts within the meaning of article 266, the members of the administration, management, supervision or audit organs of the merging companies.

(3) Where a European company (SE) is constituted by way of a merger, the project also includes:

a) the articles of association of the European company (SE);

b) information on the procedures according to which the terms relative to employee involvement are fixed in transposition of Directive 2001/86/EC of the Council of 8 October 2001 supplementing the Statute for a European company with regard to the involvement of employees.

(4) In the case of a cross-border merger, the joint merger project also includes:

a) the articles of association of the absorbing company;

b) a description of the probable effects of the merger on jobs;

c) as the case may be, information on the procedures according to which the terms relative to employee involvement are fixed in transposition of Directive 2005/56/EC of the European Parliament and the Council of 26 October 2005 on cross-border mergers of limited liability companies;

d) information concerning the valuation of the assets and liabilities transferred to the absorbing company;

e) the dates of the financial statements of the merging companies used to define the terms of the merger.

Article 262

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) The joint merger project is published in accordance with article 9 and in the national official gazettes of the other member States concerned for each of the merging companies at least one month before the date of the general meeting called to decide on the joint merger project.

(2) In the case of a cross-border merger, the disclosure must also include the following particulars:

a) the form, name and statutory registered office of the merging company;

b) the register of commerce and companies where the deeds referred to in article 9 have been lodged by the absorbing company and the registration number in that register, if a Luxembourg company is concerned; if the law of the State under which the company incorporated under foreign law falls provides for a register to be kept, the register where the deeds referred to in article 3, paragraph 2, of Directive 68/151/EEC of the Council of 9 March 1968, on co-ordination of safeguards which, for the protection of the interests of members and others, are required by Member States of companies within the meaning of the second paragraph of Article 58 of the Treaty, with a view to making such safeguards equivalent throughout the Community, have been lodged by the company incorporated under foreign law and, if the law of the State under which the company incorporated under foreign law falls provides for a registration number in that register, the registration number in that register;

c) particulars for each of the merging companies of the procedures for exercise of the rights of the creditors of the company concerned, plus the address where exhaustive information on those procedures can be obtained free of charge.

Article 263

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), supplemented by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) The merger requires to be approved by the general meetings of each of the merging companies and, as the case may be, holders of securities other than shares, after examination of the reports referred to in articles 265 and 266. This decision demands the presence and majority quorums laid down for amendments to the articles of association.

(2) In simple limited partnerships and cooperative companies, the members’ voting rights are proportional to their share in the company’s business assets and the presence quorum is calculated relative to the business assets.

(3) The agreement of all the members is required:

1) in absorbing companies or companies to be absorbed that are general partnerships, cooperative companies whose members bear unlimited, joint and several liability, non-commercial companies or economic interest groupings;

2) in companies to be absorbed where the absorbing company is:

a) a general partnership;

b) a simple limited partnership;

c) a cooperative company whose members bear unlimited, joint and several liability;

d) a non-commercial company;

e) an economic interest grouping.

In cases falling under the first paragraph, point 1° and point 2°, a), b) and c), the unanimous agreement of the holders of shares not representative of the capital is required.

(4) In simple limited partnerships and partnerships limited by shares, the agreement of all the general partners is also required.

(5) If there exist two or more classes of shares or securities, whether or not representative of the capital, and the merger entails a change in their respective rights, article 68 is applicable.

(6) Where a European company (SE) is constituted by way of a merger, the employees’ involvement in the European company (SE) is decided on in accordance with the provisions transposing Directive 2001/86/EC. The general meeting of each of the merging companies may make the right to register the European company (SE) subject to the condition that it expressly validate the procedures thus decided on.

(7) In the case of a cross-border merger, the general meeting of each of the merging companies may make consummation of the cross-border merger subject to the condition that it expressly validate the terms decided on for the participation of the employees in the company resulting from the cross-border merger.

Article 264

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792),amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268), supplemented by the Act of 3 August 2011 (Official Gazette A175 of 12/08/2011 p. 2970)) Except in the cases set forth in article 263, subarticles (2) to (4), approval of the merger by the general meeting of the absorbing company is not necessary if the following conditions are met:

a) the disclosure required under article 262 is effected, for the absorbing company, at least one month before the date of the general meeting of the absorbed company or companies called upon to render a decision on the joint merger project;

b) all the members of the absorbing company have the right, at least one month before the date specified under a), to inspect the documents referred to in article 267, subarticle (1), at the registered office of that company;

c) one or more members of the absorbing company holding 5% or more of the shares in the subscribed capital are entitled, up until the day after that on which the general meeting of the absorbed company is held, to demand the calling of a general meeting of the absorbing company for the purpose of deciding on whether to approve the merger. The meeting must be called such as to be held within a month of the demand being made. For the purposes of the first paragraph, b), article 267, subarticles (2), (3) and (4), is applicable.

Article 265

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268), the Act of 3 August 2011 (Official Gazette A175 of 12/08/2011 p. 2970))

(1) The administration or management organs of each of the merging companies prepare a detailed written report addressed to the members explaining and, from a legal and economic viewpoint, justifying the joint merger project and especially the share exchange ratio. The report furthermore specifies any particular valuation difficulties that might exist. In the case of a cross-border merger, the report is made available to the members and the workforce representatives or, if there are none, the employees themselves no later than one month before the date of the general meeting called to decide on the joint merger project.

The report explains the consequences of this merger for the members, creditors and employees. If the management or administration organ of either of the merging companies receives in due time an opinion issued by the workforce representatives, this opinion is appended to the report.

(2) The administration or management organs of each of the companies concerned inform their respective general meetings as well as the administration or management organs of the other companies concerned so that they may inform their respective general meeting of any significant change to the assets and liabilities that has occurred between the date on which the joint merger project was drawn up and the dates of the general meetings called to decide on the joint merger project.

(3) However, the report referred to in subarticle (1) and the information referred to in subarticle (2) are not required if all the members and holders of other securities conferring voting rights of each of the companies participating in the merger so decide.

Article 266

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), supplemented by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295), the Act of 3 August 2011 (Official Gazette A175 of 12/08/2011 p. 2970))

(1) The merger project must be the subject of an examination and written report intended for the members. This examination will be done and the report drawn up for each of the merging companies by one or more independent experts to be designated by the management organ of each of the merging companies. These experts must be chosen from among the accredited company auditors. However, it is possible to have the report prepared by one or more independent experts for all of the merging companies. In that case, the designation is made on a joint petition by the merging companies by the judge presiding the division of the local court in whose jurisdiction the absorbing company has its registered office, sitting in commercial matters and as under the urgent applications procedure.

In the case of a cross-border merger, the aforementioned report must be available one month before the date of the general meeting called to decide on the joint merger project. Where a European company (SE) is constituted by way of a merger or in the case of a cross-border merger, the merging companies may jointly apply to the judge presiding a division of the local court in whose jurisdiction one of the companies has its registered office, sitting in commercial matters and as under the urgent applications procedure, or to the judicial or official authority of another State under which one of the merging companies falls for the designation of one or more independent experts or engage the services of one or more independent experts accredited by such authority.

(2) In the report referred to in subarticle (1), the experts must in all events state whether, in their opinion, the exchange ratio is or is not relevant and reasonable. This statement must:

a) specify the method or methods followed to determine the proposed exchange ratio;

b) specify whether that method or those methods is or are suitable in the case and mention the values to which each of those methods leads, with an opinion being given on the relative importance given to these methods in determining the final value selected. The report furthermore specifies any particular valuation difficulties that might exist.

**(3)**The rules set down in article 26-1, subarticles (2) to (4), do not apply where an expert report is drawn up on the joint merger project or where the conditions laid down in article 26-1, subarticles (2) to (4), are not met.

(4) Each expert is entitled to obtain from the merging companies all useful information and documents and to effect all necessary verifications.

(5) Neither an examination of the joint merger project nor an expert report is required if all the members and holders of other securities conferring a voting right of each of the companies participating in the merger so decide.

Article 267

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268), the Act of 3 August 2011 (Official Gazette A175 of 12/08/2011 p. 2970))

(1) Each member has the right, one month before the date of the general meeting called to decide on the joint merger project, to inspect the following documents at the registered office:

a) the joint merger project;

b) the financial statements together with the management reports of the merging companies for the last three accounting periods;

c) as the case may be, an accounting statement drawn down to a date not prior to the first day of the third month preceding the date of the joint merger project in the event that the last financial statements relate to an accounting period whose last date is more than six months prior to that date;

d) as the case may be, the reports by the administration or management organs of the merging companies referred to in article 265;

e) as the case may be, the reports referred to in article 266.

For the purposes of the first paragraph, c), an accounting statement is not required if the company publishes a half-yearly financial report in accordance with article 4 of the Act of 11 January 2008 on the transparency obligations on issuers of securities and makes it available to the members in accordance with this subarticle or if so agreed by all the members and holders of securities conferring a voting right of each of the companies participating in the merger.

(2) The accounting statement provided for in subarticle (1) c) is prepared according to the same methods and in line with the same presentation as the last annual balance sheet. It is not, however, necessary to carry out a new actual inventory. Moreover, the valuations figuring in the last balance sheet are only changed in accordance with book entry movements; however, account will be taken of:

– interim depreciation and provisions;

– significant changes in actual value not appearing in the book entries.

(3) A full or, if he desires, a partial copy of the documents referred to in subarticle (1) may be obtained by any member at no charge and on simple request. Where a member has consented to use by the company of electronic means for the communication of information, the copies may be provided by electronic mail.

(4) A company is relieved of the obligation to make the documents referred to in subarticle (1) available at its registered office if, for a continuous period starting at least one month before the day set for the general meeting called to decide on the joint merger project and not ending before the end of that meeting, it makes them available on its website.

Subarticle (3) does not apply if, throughout the period referred to in the first paragraph of this subarticle, the website allows the members to download and print the documents referred to in subarticle (1). However, in that case, the company must make these documents available at its registered office, where they can be consulted by the members.

Article 267bis

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815))

(1) A private limited liability company, cooperative company or economic interest grouping may only absorb another company or economic interest grouping if the shareholders or members of that other company or economic interest grouping fulfil the conditions required to acquire the capacity of shareholder or member of the absorbing company or economic interest grouping.

(2) In cooperative companies, each member has the option, notwithstanding any provision to the contrary contained in the articles of association, to quit at any time without having to meet any other condition, as from the calling of the general meeting called to decide on the company’s merger with an absorbing company in another form. Notice of quitting must be served on the company by recorded delivery letter posted at least five days before the date of the meeting. It will only be of effect if the merger is approved.

Notices calling the meeting shall reproduce the wording of paragraphs 1 and 2 of this subarticle.

Article 268

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 3 August 2011 (Official Gazette A175 of 12/08/2011 p. 2970))

(1) The creditors of the merging companies whose claims predate the date of publication of the deeds recording the merger as provided for in article 273 may, notwithstanding any agreement to the contrary, within two months of that publication, petition the judge presiding the division of the local court in whose jurisdiction the debtor company has its registered office, sitting in commercial matters and as under the urgent applications procedure, for the constitution of security for claims matured or not yet matured in the case that they can credibly demonstrate that the merger constitutes a risk to the exercise of their rights and that the company has not provided them with adequate guarantees. The president rejects this petition if the creditor is in possession of adequate guarantees or if they are not necessary given the financial situation of the company after the merger. The debtor company can may have this petition dismissed by paying the creditor even if the claim is future. If the security is not provided within the period laid down, the claim immediately falls due.

(2) If the absorbed company is a general partnership, a simple limited partnership, a partnership limited by shares, a cooperative company whose members bear unlimited, joint and several liability, a non-commercial company or an economic interest grouping, the general partners of the general partnership or limited partnership, the members of the cooperative company, the members of the non-commercial company or the members of the economic interest grouping continue to be liable jointly or jointly and severally, as the case may be, towards third parties for commitments of the dissolved company prior to the time at which the merger deed becomes binding as against third parties in accordance with article 273.

(3) If the absorbing company is a general partnership, a simple limited partnership, a partnership limited by shares, a cooperative company whose members bear unlimited, joint and several liability, a non-commercial company or an economic interest grouping, the general partners of the general partnership or limited partnership, the members of the cooperative company, the members of the non-commercial company or the members of the economic interest grouping are liable, jointly or jointly and severally, as the case may be, towards third parties for commitments of the dissolved company prior to the merger. However, they may be exonerated from this liability by an express clause incorporated into the merger project and deed, which is binding as against third parties in accordance with article 273.

Article 269

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792)) Without prejudice to the rules relative to the collective exercise of their rights, article 268 is applied to the bond holders of the merging companies unless the merger has been approved by a meeting of bond holders or by the bond holders individually.

Article 270

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) Holders of securities other than shares, to which special rights attach, must be accorded rights within the absorbing company that are at least equivalent to those they held in the absorbed company.

(2) Subarticle (1) is not applicable if the change in the rights in question has been approved by a meeting of the holders of those securities deciding under the presence and majority conditions set down in article 263.

(3) If the meeting provided for in the preceding subarticle is not called or if it refuses to accept the proposed change, the securities in question are redeemed at the price corresponding to their valuation as contained in the joint merger project and verified by the independent experts provided for in article 266.

Article 271

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), supplemented by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 826), amended by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) The minutes of the general meetings deciding on the merger are set down by notarial deed; the same applies to the joint merger project where the merger need not be approved by the general meetings of all the merging companies.

(2) The notary public must verify and attest the existence and legality of the deeds and formalities incumbent on the company before which he is officiating and of the joint merger project. Where a European company (SE) is constituted by way of a merger or in the case of a cross-border merger, the notary public shall without delay issue a certificate attesting conclusively that the deeds and formalities prior to the merger relative to the Luxembourg law entity have been duly completed.

Where a European company (SE) constituted by way of a merger is destined to set up its statutory registered office in Luxembourg, or where a cross-border merger is effected by the absorption by a Luxembourg law company of a foreign law company, the notary public shall, for the purposes of effecting the legality check incumbent on him, within a period of six months from its issue, receive from each merging company the certificate referred to in the preceding paragraph drawn up by a notary public or any competent authority according to the national law of each merging company together with a copy of the joint merger project approved by each company. The notary public particularly verifies that the merging companies have approved the joint merger project in the same terms and, as the case may be, that the terms relative to employees’ participation have been fixed in conformity with the statutory provisions enacted in application of Directive 2001/86/EC of the Council of 8 October 2001 supplementing the Statute for a European company with regard to the involvement of employees in article 16 of Directive 2005/56/EC of the European Parliament and of the Council of 26 October 2005 on cross-border mergers of limited liability companies.

(3) In the case of a cross-border merger, if the law of a State under which a merging company falls provides a procedure allowing the security or share exchange ratio to be analysed and altered or a procedure aimed at compensating the minority members without preventing registration of the cross-border merger, that procedure only applies if the other merging companies situated in a State not providing for this type of procedure explicitly agree, when approving the cross-border merger project, to the possibility offered to the members of that merging company to take recourse to said procedures to be initiated before the authority competent for that merging company. In this case, the notary public or competent authority referred to in the preceding paragraph may issue the certificate referred to therein even if a procedure of that type has been initiated. However, the certificate must state that the procedure is on-going. The decision taken at the outcome of the procedure is binding on the company emerging from the cross-border merger and all of its members.

Article 272

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792)) The merger is consummated where concordant decisions are taken within the companies in question.

Article 273

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) The merger has no effect vis-à-vis third parties until after publication has been made in accordance with article 9 of the minutes of the general meetings deciding on the merger for each of the merging companies or, failing such meeting, publication has been made in accordance with article 9 of a certificate by a notary public drawn up at the request of the company concerned recording that the conditions laid down in article 279 or article 281 are fulfilled.

(2) The absorbing company may itself effect the publication formalities concerning the absorbed company or companies.

Article 273bis

(inserted by the Act of 25 September 2006 (Official Gazette A152 of 31/08/2006 p. 2684), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 826))

(1) By derogation from articles 272 and 273, the simultaneous merger and formation of a European company (SE) take effect on the date on which the European company (SE) is registered in the register of commerce and companies.

(2) A European company (SE) may only be registered once all the formalities provided for in article 271 have been completed.

Article 273ter

(inserted by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) By derogation from articles 272 and 273, the merger by absorption of a foreign law company is consummated and takes effect vis-à-vis third parties as from the date of publication in accordance with article 9 of the minutes of the general meeting of the absorbing company that decides on the merger. This date must be after completion of the checks provided for in article 271.

(2) The register of commerce and companies notifies without delay the register where each of the merging companies was obliged to lodge deeds that the cross-border merger has taken effect.

(3) In the case of absorption of a Luxembourg law company by a foreign law company, the striking-off of the absorbed company is effected as of receipt by the register of commerce and companies of notification of the effectiveness of the merger by the register under which the absorbing company falls, and not before.

Article 274

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), supplemented by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), supplemented by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) The merger entails ipso iure and simultaneously the following effects:

a) universal transfer, both between the absorbed company and the absorbing company and vis-à-vis third parties, of the totality of the net assets and liabilities of the absorbed company to the absorbing company;

b) the members of the absorbed company become members of the absorbing company;

c) the absorbed company ceases to exist;

d) cancellation of the shares of the absorbed company held by the absorbing company or by the absorbed company or by any person acting in his own name but on behalf of either of those companies.

(2) By derogation from subarticle (1) a), the transfer of industrial and intellectual property rights and of real rights other than real securities over movables and immovable is only binding as against third parties under the conditions set down by the special laws governing these transactions. These formalities may still be carried out during the period of six months as from the effective date of the merger.

(3) The rights and obligations of the participating companies in relation to conditions of employment resulting from the law, practice and individual employment contracts or employment relations at national level and existing on the date of registration are transferred to the European company (SE) at the time of registration of its very existence.

(4) In the case of cross-border merger transactions, the rights and obligations of the participating companies resulting from employment contracts or employment relations and existing on the effective date of the cross-border merger according to the provisions of article 273ter, subarticle (1), are transferred to the absorbing company on the effective date of the cross-border merger.

Article 275

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), replaced by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268)) The members of the absorbed company may individually pursue and exercise against the members of the administration or management organs and the experts provided for in article 266 a liability action seeking compensation of any loss they have suffered pursuant to fault committed by the members of the administration or management organs during preparation and consummation of the merger or by the experts in the fulfilment of their engagement. Liability weighs jointly and severally on the members of the administration or management organs or the experts of the absorbed company or, as the case may be, on all of them. However, each of them may cause a claim against him to be dismissed if he proves that no fault is attributable to him personally.

Article 276

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 826), replaced by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) The merger may only be void in the following conditions:

a) it must be declared void by a court judgment;

b) where the merger is carried out in accordance with article 272, it may only be pronounced void for want of a notarised or, as the case may be, private deed or if it is proved that the decision by the general meeting of any of the companies taking part in the merger is void;

c) the action to set aside can no longer be raised after the expiry of a period of six months from the date on which the merger is binding as against him who cites the fact it is void, or if the situation has been rectified;

d) where it is possible to remedy the irregularity liable to entail the merger’s being void, the competent court grants the companies in question time to remedy the situation;

e) the decision declaring the merger void is published according to the methods set down in article 9;

f) a third-party application to set aside the decision declaring the merger to be void can no longer be received after expiry of a period of six months from publication of the decision according to article 9;

g) the decision declaring the merger to be void does not per se affect the validity of obligations arising to the burden or benefit of the absorbing company prior to publication of the decision and after the date referred to in article 272;

h) the companies that took part in the merger are jointly and severally liable for the obligations of the absorbing company as referred to under g).

(2) By derogation from subarticle (1), point b), a merger intended to constitute a European company (SE) may not be pronounced void where the European company (SE) is registered in the register of commerce and companies. The European company (SE) may be dissolved where verification of the merger’s legality has not be done in accordance with article 271(2).

(3) By derogation from subarticle (1), point c), a merger by absorption of a foreign law company that has taken effect according to article 273 ter cannot be pronounced void.

Sub-part 2. Merger by formation of a new company (article 277) (heading inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792))

Article 277

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268), the Act of 3 August 2011 (Official Gazette A175 of 12/08/2011 p. 2970))

(1) Articles 261, 262 and 263 as well as articles 265 to 276 are applicable to mergers by the formation of a new company. For this purpose, the expressions “merging companies” or “absorbed company” designate the companies that disappear and the expression “absorbing company” designates the new company.

(2) Article 261, subarticle (2)a), is likewise applicable to the new company.

(3) The joint merger project containing the draft deed of incorporation of the new company must be approved by the general meeting of each of the disappearing companies. The new company shall exist as from the last approval.

(4) The rules laid down in article 26-1, subarticles (2) to (4), do not apply to formation of the new company where an expert’s report on the joint merger project is drawn up or where the conditions of article 26-1, subarticles (2) to (4), are not met.

(5) Where the new company resulting from a cross-border merger is a Luxembourg law company, the notary public’s verification of its legality as provided for in article 271, subarticle (2), also relates to the part of the procedure relative to formation of that company.

Sub-part 3. Absorption of a company by another possessing 90% or more of the shares and securities conferring voting rights in the first company (articles 278 to 284) (heading inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

Article 278

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), replaced by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268)) If the absorbing company holds all the shares and other securities conferring voting rights in the companies to be absorbed, the latter companies transfer their entire net assets and liabilities to it as a consequence and at the time of their dissolution without liquidation. The transaction is subject to the provisions of part XIV, sub-part I, with the exception of article 261, subarticle (2) b), c) and d), articles 265 and 266, article 267, subarticle (1) d) and e), article 274, subarticle (1) b) and article 275. The first paragraph is not applicable to European companies (SE). In the case of a cross-border merger, the provisions of articles 265 and 267, subarticle (1) d) continue to apply.

Article 279

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268), the Act of 3 August 2011 (Official Gazette A175 of 12/08/2011 p. 2970))

(1) Article 263, subarticle (1), is not applicable in the case where, under the situation referred to in the preceding article:

a) the disclosure required by article 262 is done for each of the companies participating in the transaction at least one month before the transaction takes effect as between the parties;

b) all the members of the absorbing company are entitled at least one month before the transaction takes effect as between the parties to inspect the documents referred to in article 267, subarticle (1) a), b) and c) at that company’s registered office.

c) one or more members of the absorbing company possessing 5% or more of the shares in the subscribed capital may, during the period laid down under b), demand the calling of a general meeting of the absorbing company to decide on whether to approve the merger. The meeting must be called such as to be held within a month of the demand made. For the purposes of the first paragraph, b), article 267, subarticles (2), (3) and (4) is applicable.

(2) In the case of a cross-border merger, article 263, subarticle (1), is not applicable to the absorbed company or companies.

Article 280

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15./09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) Articles 278 and 279 also remain applicable to absorption transactions in cases where all the shares and other securities referred to in article 278 of the absorbed company or companies belong to the absorbing company and/or to persons holding those shares and securities acting in their own name but on behalf of that company.

Article 281

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268), the Act of 3 August 2011 (Official Gazette A175 of 12/08/2011 p. 2970))

(1) Where a merger by absorption is effected by a company holding 90% but not all of the shares and other securities conferring voting rights at general meetings of the absorbed company or companies, approval of the merger by the general meeting of the absorbing company is not necessary if the following conditions are met:

a) the disclosure required by article 262 is made, for the absorbing company, at least one month before the date of the general meeting of the absorbed company or companies called to decide on the joint merger project. The provisions of this point a) are not applicable to cross-border mergers of companies;

b) all the members of the absorbing company are entitled at least one month before the date referred to under a) to inspect the documents referred to in article 267, subarticle (1) a) and b) and, as the case may be, in article 267, subarticle (1) c), d), and e), at the company’s registered office.

c) article 264 c) applies.

For the purposes of the first paragraph, (b), article 267, subarticles (2), (3) and (4) is applicable.

(2) Where a cross-border merger by absorption is effected by a company that holds 90% or more but not all of the shares and other securities conferring voting rights at general meetings of the absorbed company or companies, the reports of one or more independent experts and the documents necessary for the verification are required only in so far as they are required by the national law under which the absorbing company falls or by the national law under which the absorbed company or companies fall(s).

Article 282

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) Articles 265, 266 and 267 are not applicable in the case of a merger as falling under the preceding article if the following conditions are met:

a) the minority members of the absorbed company can exercise their right to cause their shares to be acquired by the absorbing company;

b) in that case, they are entitled to receive a consideration corresponding to the value of their shares;

c) in the event of disagreement concerning that consideration, it is fixed by the judge presiding the division of the local court in whose jurisdiction the absorbing company has its registered office sitting in commercial matters and as under the urgent applications procedure.

Article 283

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) Articles 281 and 282 also apply to absorption transactions where 90% or more but not all of the shares and other securities referred to in article 281 of the absorbed company or companies belong to the absorbing company or to persons holding such shares and securities acting in their own name but on behalf of that company.

Sub-part 4. Other transactions equated to a merger (article 284)

Article 284

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) Where, notwithstanding the provisions laid down in articles 259 and 260, the cash balance exceeds 10%, sub-parts I and II and articles 281, 282 and 283 remain applicable. The same applies where one or more companies put themselves into liquidation and transfer their assets and liabilities to another company in return for the allotment of shares in that latter company to the members of the first company, whether with or without a cash balance.

PART XV. DIVISIONS (ARTICLES 285 TO 308)

(heading inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792))

Article 285

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), replaced by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) This part applies to all companies endowed with legal personality pursuant to this act and to economic interest groupings. A division can also take place where the company or economic interest grouping that is absorbed or disappears is subject to a bankruptcy, creditors’ arrangement or another, similar procedure such as a moratorium, administration or a procedure instituting special management or supervision of one or more of those companies or economic interest groupings. An company or economic interest grouping, as referred to in the first paragraph, may also contract a division transaction with a foreign company or economic interest grouping provided the latter’s national law does not constitute an objection thereto. Where, in the following provisions, reference is made to the “company/ies”, this term shall be construed, unless otherwise particularly indicated, as also including “economic interest grouping(s)”.

Article 286

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792)) A division is effected by absorption, by the formation of new companies or by a combination of these two processes.

Article 287

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) Division by absorption is an operation by which a company either transfers, following its dissolution without liquidation, to two or more other companies all of its assets and liabilities, or transfers, without dissolution, to one or more other companies a part or all of its assets and liabilities in return for allotment to the members of the divided company of shares in the companies receiving the contributions resulting from the division and, possibly, a cash balance not exceeding 10% of the nominal value of the shares allotted or, failing a nominal value, their accounting par.

(2) Division by absorption may also take place where the absorbed company is in liquidation, provided it has not yet started distribution of its assets among its members.

Article 288

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) Division by the formation of new companies is an operation by which a company either transfers, following its dissolution without liquidation, to two or more newly constituted companies all of its net assets and liabilities or transfers without dissolution to one or more newly constituted companies a part or all of its assets and liabilities in return for allotment to its members of shares in the receiving companies and, possibly, a cash balance not exceeding 10% of the nominal value of the shares allotted or, failing a nominal value, their accounting par.

(2) Division by formation of new companies can also take place where the company that disappears is in liquidation, provided it has not yet started distribution of its assets among its members.

Sub-part 1. Division by absorption (articles 289 to 306) (heading inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815))

Article 289

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815))

(1) The management organs of the companies participating in the division prepare a joint division project in writing.

(2) The division project sets forth:

a) the form, name and registered office of the companies participating in the division;

b) the share exchange ratio and the amount of any cash balance;

c) the procedures for delivering the shares of the receiving companies;

d) the date from which those shares confer a right to share in the profits and any particular procedure relative to that right;

e) the date from when the transactions of the divided company are deemed from an accounting viewpoint as carried out for the account of one or another of the receiving companies;

f) the rights assured by the receiving companies in favour of the members having special rights and to holders of securities other than shares, or the measures proposed in their regard;

g) any particular advantages attributed to the experts within the meaning of article 294, the members of the management and the statutory auditors of the companies participating in the division;

h) a description and precise scheme of distribution of the items of the assets and liabilities to be transferred to each of the receiving companies;

i) the scheme of distribution to the members of the divided company of shares in the receiving companies, together with the criterion on which that scheme of distribution is based.

(3) a) Where an item of the assets is not attributed in the division project and the interpretation of the project does not allow its distribution to be decided on, this item or its counter-value is distributed among all the receiving companies in a manner that is proportional to the assets attributed to each of them in the division project.

b) Where an item of the liabilities is not attributed in the division project and the interpretation of the project does not allow its distribution to be decided on, each of the receiving companies is jointly and severally liable therefor. However, the joint and several liability of the receiving companies is limited to the net assets attributed to each of them.

Article 290

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792)) The division project is published in accordance with article 9 for each of the companies participating in the division at least one month before the date of the general meeting called to decide on that division project.

Article 291

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), replaced by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815))

(1) The division requires to be approved by the general meetings of each of the companies participating in the division and, as the case may be, holders of securities other than shares. This decision demands the presence and majority quorums laid down for amendments to the articles of association.

(2) In simple limited partnerships and cooperative companies, the members’ voting rights are proportional to their share in the company’s business assets and the presence quorum is calculated relative to the business assets.

(3) The agreement of all the members is required:

1) in companies to be divided or receiving companies that are general partnerships, cooperative companies whose members bear unlimited, joint and several liability, non-commercial companies or economic interest groupings;

2) in a company to be divided where at least one of the receiving companies is:

a) a general partnership;

b) a simple limited partnership;

c) a cooperative company whose members bear unlimited, joint and several liability;

d) a non-commercial company;

e) an economic interest grouping.

In cases falling under the first paragraph, point 1° and point 2°, a), b) and c), the unanimous agreement of the holders of securities not representative of the capital is required.

(4) In simple limited partnerships and partnerships limited by shares, the agreement of all the general partners is also required.

(5) If there exist two or more classes of shares or securities, whether or not representative of the capital, and the division entails a change in their respective rights, article 68 is applicable

Article 292

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 3 August 2011 (Official Gazette A175 of 12/08/2011 p. 2970)) Except in the cases set forth in article 291, subarticles (2) to (4), approval of the division by the general meeting of a receiving company is not necessary if the following conditions are met:

a) a) the disclosure required under article 290 is effected for the receiving company at least one month before the date of the general meeting of the divided company called upon to render a decision on the division project;

b) b) all the members of the receiving company have the right, at least one month before the date specified under a), to inspect the documents referred to in article 295, subarticle (1), at the registered office of that company;

c) one or more members of the receiving company holding 5% or more of the shares in the subscribed capital are entitled, up until the day after that on which the general meeting of the divided company is held, to demand the calling of a general meeting of the receiving company for the purpose of deciding on whether to approve the division. The meeting must be called such as to be held within a month of the demand being made. For the purposes of the first paragraph, b), article 295, subarticles (2), (3) and (4), is applicable.

Article 293

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09./1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815))

(1) The management organs of each of the companies participating in the division prepare a detailed written report explaining and justifying, from a legal and economic viewpoint, the division project and especially the exchange ratio for the shares and the criterion for their distribution.

(2) The report furthermore specifies any particular valuation difficulties that might exist. As the case may be, it also mentions preparation of the report on verification of the contributions other than in cash, as referred to in article 26-1, subarticle (2), and its lodging in accordance with article 9, subarticles (1) and (2).

(3) The management organ of the divided company must inform the general meeting of the divided company as well as the management organs of the receiving companies so that they may inform the general meeting of their company of any significant change to the assets and liabilities that has occurred between the date on which the division project was drawn up and the date of the general meeting of the divided company called to decide on the division project.

Article 294

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295), the Act of 3 August 2011 (Official Gazette A175 of 12/08/2011 p. 2970))

(1) The division project must be the subject of an examination and written report intended for the members. This examination will be done and the report drawn up for each of the companies participating in the division by one or more independent experts to be designated by the management organ of each of the companies participating in the division. These experts must be chosen from among the accredited company auditors. However, it is possible to have the report prepared by one or more independent experts for all of the companies participating in the division. In that case, the designation is made, on a joint petition by the companies participating in the division, by the judge presiding the division of the local court in whose jurisdiction the divided company has its registered office, sitting in commercial matters and as under the urgent applications procedure.

(2) In the report referred to in subarticle (1), the experts must in all events state whether, in their opinion, the exchange ratio is or is not relevant and reasonable. This statement must:

a) specify the method or methods followed to determine the proposed exchange ratio;

b) specify whether that method or those methods is or are suitable in the case and mention the values to which each of those methods leads, with an opinion being given on the relative importance given to these methods in determining the final value selected. The report furthermore specifies any particular valuation difficulties that might exist.

(3) The rules set down in article 26-1, subarticles (2) to (4), do not apply where an expert report is drawn up on the division project or where the conditions laid down in article 26-1, subarticles (2) to (4), are not met

(4) Each expert is entitled to obtain from the companies participating in the division all useful information and documents and to effect all necessary verifications

Article 295

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268), the Act of 3 August 2011 (Official Gazette A175 of 12/08/2011 p. 2970))

(1) Each member is entitled one month before the date of the general meeting called to decide on the division project to inspect the following documents at the company’s registered office:

a) the division project;

b) the financial statements and management reports for the past three financial periods for the companies participating in the division;

c) as the case may be, an accounting statement drawn down to a date not preceding the first day of the third month preceding the date of the division project in the case where the last financial statements relate to a financial period which ended more than six months prior to that date;

d) as the case may be, the reports by the management organs of the companies participating in the division, referred to in article 293, subarticle (1);

e) as the case may be, the reports referred to in article 294. For the purposes of the first paragraph, c), an accounting statement is not required if the company publishes a half-yearly financial report in accordance with article 4 of the Act of 11 January 2008 on the transparency obligations for issuers of securities and makes it available to the members in accordance with this subarticle.

(2) The accounting statement provided for in subarticle (1) c) is prepared according to the same methods and in line with the same presentation as the last annual balance sheet. It is not, however, necessary to carry out a new actual inventory.

Moreover, the valuations figuring in the last balance sheet are only changed in accordance with book entry movements; however, account will be taken of:

– interim depreciation and provisions;

– significant changes in actual value not appearing in the book entries.

(3) A full or, if he desires, a partial copy of the documents referred to in subarticle (1) may be obtained by any member at no charge and on simple request. Where a member has consented to use by the company of electronic means for the communication of information, the copies may be provided by electronic mail.

(4) A company is relieved of the obligation to make the documents referred to in subarticle (1) available at its registered office if, for a continuous period starting at least one month before the day set for the general meeting called to decide on the division project and not ending before the end of that meeting, it makes them available on its website.

Subarticle (3) does not apply if, throughout the period referred to in the first paragraph of this subarticle, the website allows the members to download and print the documents referred to in subarticle (1). However, in that case, the company must make these documents available at its registered office, where they can be consulted by the members.

Article 296

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), replaced by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268))

(1) Neither an examination of the division project nor the expert report provided for in article 294, subarticle (1), is required if so decided by all the members and holders of other securities conferring a voting right of each of the companies participating in the division.

(2) The requirements of articles 293 and 295, subarticle (1) c) and d), do not apply if all the members and holders of other securities conferring a voting right in each of the companies participating in the division have waived them.

Article 296bis

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815))

(1) A private limited liability company, cooperative company or economic interest grouping may only participate in a division transaction as receiving company or economic interest grouping if the shareholders or members of the company or economic interest grouping to be divided fulfill the conditions required to acquire the capacity of partner or member of that company or economic interest grouping.

(2) In cooperative companies, each member has the option, notwithstanding any provision to the contrary contained in the articles of association, to quit at any time without having to meet any other condition, as from the calling of the general meeting called to decide on the company’s division in favour of receiving companies at least one of which is in another form. Notice of quitting must be served on the company by recorded delivery letter posted at least five days before the date of the meeting. It will only be of effect if the division is approved. Notices calling the meeting shall reproduce the wording of paragraphs 1 and 2 of this subarticle.

Article 297

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 3 August 2011 (Official Gazette A175 of 12/08/2011 p. 2970))

(1) The creditors of the companies participating in the division, whose claims predate the date of publication of the deeds recording the division as provided for in article 302 may, notwithstanding any agreement to the contrary, within two months of that publication, petition the judge presiding the division of the local court in whose jurisdiction the debtor company has its registered office, sitting in commercial matters and as under the urgent applications procedure, for the constitution of security for claims matured or not yet matured in the case that they can credibly demonstrate that the division constitutes a risk to the exercise of their rights and that the company has not provided them with adequate guarantees. The petition is rejected if the creditor is in possession of adequate guarantees or if they are not necessary given the financial situation of the companies participating in the division. The debtor company may have this petition dismissed by paying the creditor even if the claim is future. If the security is not provided within the period laid down, the claim immediately falls due.

(2) To the extent that a creditor or bond holder of the divided company has not gained satisfaction from the company to which the obligation has been transferred according to the division project, the receiving companies are jointly and severally liable for that obligation. The joint and several liability of the receiving companies is nonetheless limited to the net assets attributed to each of them.

(3) If the dissolved company is a general partnership, a simple limited partnership, a partnership limited by shares, a cooperative company whose members bear unlimited, joint and several liability, a non-commercial company or an economic interest grouping, the general partners of the general partnership or limited partnership, the members of the cooperative company, the members of the non-commercial company or the members of the economic interest grouping continue to be liable jointly or jointly and severally, as the case may be, towards third parties for commitments of the dissolved company prior to the time at which the division deed becomes binding as against third parties in accordance with article 302.

(4) If the receiving company is a general partnership, a simple limited partnership, a partnership limited by shares, a cooperative company whose members bear unlimited, joint and several liability, a non-commercial company or an economic interest grouping, the general partners of the general partnership or limited partnership, the members of the cooperative company, the members of the non-commercial company or the members of the economic interest grouping are liable, jointly or jointly and severally, as the case may be, towards third parties for commitments of the dissolved company prior to the division and that, in this latter case, have been transferred to the receiving company in accordance with the division project and article 289(3) b). However, they may be exonerated from this liability by an express clause incorporated into the division project and deed, which is binding as against third parties in accordance with article 302.

Article 298

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792)) Without prejudice to the rules relative to the collective exercise of their rights, article 297 is applied to the bond holders of the companies participating in the division, unless the division has been approved by a meeting of bond holders or by the bond holders individually.

Article 299

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815))

(1) Holders of securities other than shares, to which special rights attach, must be accorded rights within the receiving companies against which those securities can be enforced in accordance with the division project that are at least equivalent to those they held in the divided company.

(2) Subarticle (1) is not applicable if the change in the rights in question has been approved by a meeting of the holders of those securities deciding under the presence and majority conditions set down in article 291.

(3) If the meeting provided for in the preceding subarticle is not called or if it refuses to accept the proposed change, the securities in question are redeemed at the price corresponding to their valuation as contained in the division project and verified by the independent experts provided for in article 294.

Article 300

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815))

(1) The minutes of the general meetings deciding on the division are set down by notarial deed; the same applies to the division project where the division need not be approved by the general meetings of all the companies participating in the division.

(2) The notary public must verify and attest the existence and legality of the deeds and formalities incumbent on the company before which he is officiating and of the division project.

(3) General partnerships, simple limited partnerships, cooperative companies, noncommercial companies and economic interest groupings shall, for the purposes of preparation of the deed referred to in (1), adopt the form of a notarial deed or a private deed depending on what is provided for regarding their formation.

Article 301

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792)) The division is consummated where concordant decisions are taken within the companies in question.

Article 302

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15./09/1987 p. 1792))

(1) The division has no effect vis-à-vis third parties until after disclosure has been made in accordance with article 9 for each of the companies participating in the division.

(2) Any receiving company may itself effect the disclosure formalities concerning the divided company.

Article 303

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15./09./1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815))

(1) The division entails ipso iure and simultaneously the following effects:

a) transfer, both between the divided company and the receiving companies and vis- à-vis third parties, of the entire assets and liabilities of the divided company to the receiving companies; this transfer is effected by the portions in accordance with the scheme of distribution provided for in the division project or in article 289 subarticle (3);

b) the members of the divided company become members of one of, or of, the receiving companies, according to the scheme of distribution provided for in the division project;

c) the divided company ceases to exist;

d) cancellation of the shares of the divided company held by the receiving company or companies or by the divided company or by any person acting in his own name but on behalf of these companies.

(2) By derogation from subarticle (1) a), the transfer of industrial and intellectual property rights and of real rights other than real securities over movables and immovable is only binding as against third parties under the conditions set down by the special laws governing these transactions. The receiving company or companies may effect these formalities itself/themselves.

Article 304

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09./1987 p. 1792), amended by the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684)) The members of the divided company may individually pursue and exercise against the members of the management organs and the experts of the divided company a liability action seeking compensation of any loss they have suffered pursuant to fault committed by the members of the management organs during preparation and consummation of the division or by the experts in the fulfilment of their engagement. Liability weighs jointly and severally on the members of the management organs or the experts of the divided company or, as the case may be, on all of them. However, each of them may cause a claim against him to be dismissed if he proves that no fault is attributable to him personally.

Article 305

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) The division may only be void in the following conditions:

a) it must be declared void by a court judgment;

b) where the division is carried out in accordance with article 301, it may only be pronounced void for want of a notarised or, as the case may be, private deed or if it is proved that the decision by the general meeting of any of the companies taking part in the division is void;

c) the action to set aside can no longer be raised after the expiry of a period of six months from the date on which the division is binding as against him who cites the fact it is void, or if the situation has been rectified;

d) where it is possible to remedy the irregularity liable to entail the division’s being void, the competent court grants the companies in question time to remedy the situation;

e) the decision declaring the division void is published according to the methods set down in article 9;

f) a third-party application to set aside the decision declaring the division to be void can no longer be received after expiry of a period of six months from publication of the decision according to article 9;

g) the decision declaring the division to be void does not per se affect the validity of obligations arising to the burden or benefit of the receiving companies prior to publication of the decision and after the date referred to in article 301;

h) each of the receiving companies is liable for the obligations borne by it and arising after the effective date of the division and before the date on which notice of the decision that the division is void has been published. The divided company is also liable for these obligations. However the liability of the receiving company is limited to the net assets that have been attributed to it.

Article 306

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 3 August 2011 (Official Gazette A175 of 12/08/2011 p. 2970)) Without prejudice to article 292, where the receiving companies are, as a whole, holders of all the shares in the divided company and of its other securities conferring voting rights at general meetings, approval of the division in accordance with article 291, subarticle (1), by the general meeting of the divided company is not necessary if the following conditions are met:

a) the disclosure required by article 290 is done for each of the companies participating in the transaction at least one month before the transaction takes effect as between the parties;

b) all the members of the companies participating in the transaction are have the right at least one month before the transaction takes effect as between the parties to inspect the documents referred to in article 295, subarticle (1) at the registered office of their company;

c) if no general meeting is called of the divided company to decide on approval of the division, the information referred to in article 293, subarticle (3), concerns any significant change in the net assets and liabilities occurring after the date on which the division project was prepared. For the purposes of the first paragraph, b), article 295, subarticles (2), (3) and (4), as well as article 296, are applicable.

Sub-part 2. Division by formation of new companies (article 307) (heading inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792))

Article 307

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815), the Act of 3 August 2011 (Official Gazette A175 of 12/08/2011 p. 2970))

(1) Articles 289, 290, 291, 293 and article 294, subarticles (1), (2) and (4), and articles 295 to 305 are applicable to divisions by the formation of new companies. For this purpose, the expression “companies participating in the division” designates the divided company, the expression “company receiving the contributions resulting from the division” designates each of the new companies.

(2) Apart from the particulars set down in article 289, subarticle (2), the division project sets forth the form, name and registered office of each of the new companies.

(3) The division project containing the draft deed of incorporation of each of the new companies must be approved by the general meeting of the divided company.

(4) The rules laid down in article 26-1, subarticles (2) to (4), do not apply where an expert report on the division project is drawn up or where the conditions of article 26-1, subarticles (2) to (4), are not met.

(5) The rules laid down in articles 293, 294 and 295, subarticle (1) c), d) and e), do not apply to formation of the new companies where the shares of each of the new companies are allotted to the members of the divided company in proportion to their rights in the capital of that company.

Sub-part 3. Other transactions equated to a division (article 308) (inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792))

Article 308

(inserted by the Act of 7 September 1987 (Official Gazette A77 of 15/09/1987 p. 1792), amended by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) Where, notwithstanding the provision laid down in articles 287 and 288, the cash balance exceeds 10%, sub-parts I and II continue to apply. The same applies where a company puts itself into liquidation and transfers its assets and liabilities to a number of other companies in return for the allotment of shares in those companies to the members of the first company, with or without a balance.

PART XVBIS. TRANSFERS OF ASSETS, BRANCHES OF ACTIVITY AND TOTALITIES OF ASSETS (ARTICLES 308BIS-1 TO 308BIS-5)

Article 308bis-1

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) This part applies to all companies endowed with legal personality pursuant to this act and to economic interest groupings. Where reference is made in the provisions that follow to the “company/ies”, this term shall be construed, unless otherwise indicated, as also referring to “economic interest grouping(s)”.

Article 308bis-2

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) An company that contributes a part of its assets to another company and the company receiving that contribution may decide by joint agreement to subject the transaction to the provisions of articles 285 to 308, except for article 303. In that case, the contribution shall entail ipso iure the transfer to the receiving company of the assets and liabilities attaching thereto.

Article 308bis-3

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) Contribution of a branch of activity is a transaction by which a company, without being dissolved, transfers to another company a branch of its activity together with the attendant assets and liabilities in return for a consideration comprising shares in the company receiving the contribution. A company that contributes a branch of activity to another company and the company receiving that contribution may decide by joint agreement to subject the transaction to the provisions of articles 285 to 308, except for article 303. In that case, the contribution shall entail ipso iure the transfer to the receiving company of the assets and liabilities attaching thereto. A branch of activity comprises an ensemble that, from a technical viewpoint and from an organisational aspect, carries on an autonomous business activity and is able to operate by its own means.

Article 308bis-4

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) A contribution of a totality of assets is a transaction by which a entity, without being dissolved, transfers its entire net assets and liabilities to one or more existing or new companies in return for a consideration comprising shares in the company or companies receiving the contributions. The company contributing a totality of assets to another company and the company receiving that contribution may subject the transaction to the provisions of articles 285 to 308, except for article 303. In that case, the contribution shall entail ipso iure the transfer to the receiving company of the assets and liabilities attaching thereto.

Article 308bis-5

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) In the case of a transfer for no consideration or for valuable consideration of assets, a branch of activity or a totality of assets falling within the definitions in articles 308bis-3 and 308bis-4, the parties may subject the transaction to the rules set down by articles 285 to 308, except for article 303. In that case, the assignment shall entail ipso iure the transfer to the receiving company of the assets and liabilities attaching thereto. This will is stated expressly in the transfer project drawn up in accordance with article 289 and in the deed of transfer lodged according to article 302. This project and deed are prepared in notarised form, as the case may be.

Article XVter. - Transfers of net business assets (articles 308bis-6 to 308bis-14) (heading inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815))

Article 308bis-6

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) Companies, economic interest groupings and natural persons may transfer all or part of their business assets with assets and liabilities to another legal subject in the context of a business assignment. Articles 285 to 308, except for article 303, apply where the transferor and transferee subjects are companies endowed with legal personality pursuant to this act or economic interest groupings and the members of the transferor company or grouping receive shares in the transferee company or grouping. An company, economic interest grouping or natural person falling under the first paragraph may also contract a transfer transaction over its business assets with a foreign company, economic interest grouping or natural person provided the latter’s national law does not preclude same. The transfer of business assets entails ipso iure the transfer to the receiving company of the assets and liabilities attaching thereto.

Article 308bis-7

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) Subjects participating in the transfer enter into the contract of transfer, as the case may be on the decision of their general meeting, under the quorum, presence and majority conditions laid down for amendments to the articles of association. The provisions of article 291, subarticles (2) to (5), and of article 292 shall be complied with, as the case may be. That contract must be in written form. The provisions of article 300 must be observed.

Article 308bis-8

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815))

(1) The management organs of the subjects participating in the transfer shall prepare a transfer project in writing.

(2) The transfer project states:

a) the legal form, corporate name or name, and registered office or home address of the subjects participating in the transfer;

b) an inventory clearly setting forth the items of the net assets and liabilities that are to be transferred;

c) the total value of the assets and liabilities to be transferred;

d) any counter-performance.

(3) The asset transfer is only permitted if the inventory presents an asset surplus.

(4) a) If an item of the assets cannot be attributed on the basis of the transfer project and the interpretation of the project does not allow of its attribution, that item remains within the transferor subject.

b) If an item of the liabilities cannot be attributed on the basis of the transfer project and the interpretation of the project does not allow of its attribution, the transferor subject and the transferee subject are jointly and severally liable for it.

e) However, the joint and several liability of the transferee subject is limited to the net assets attributed to him.

Article 308bis-9

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) The transfer project is published in accordance with article 9 by each of the subjects participating in the transfer at least one month before the date on which the contract of transfer is entered into, i.e., as the case may be, at least one month before the date of the general meeting called to decide on the transfer project.

Article 308bis-10

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) The management organs of each of the subjects participating in the transfer shall, for the purposes of a decision being taken, prepare a detailed written report explaining and, from a legal and economic viewpoint, justifying the transfer project, namely:

a) the aim and consequences of the transfer of business assets;

b) the contract of transfer;

c) the counter-performance for the transfer.

Article 308bis-11

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815))

(1) The transferor subject remains jointly and severally liable for three years along with the transferee subject for performance of debts arising prior to the transfer of business assets.

(2) All rights of action against the transferor subject prescribe no later than three years after publication of transfer of the business assets. If the claim does not fall due until after that publication, prescription runs as from the time the claim was due.

(3) The subjects participating in the transfer of business assets must, on a demand made by their creditors as referred to in (1), provide security:

a) if the joint and several liability extinguishes before the end of the three-year period; or

b) if the creditors show reasonable cause that the joint and several liability does not constitute sufficient protection. The creditors formulate their demand in this regard according to the procedure set down in article 297, which applies mutatis mutandis.

(4) The creditors of the transferor subject and of the transferee subject whose claim is not included in the transferred business assets and predates publication of the transfer as provided for in article 308bis-12 may also demand the constitution of securities according to the procedure laid down in article 297.

(5) The subjects participating in the transfer of business assets who are required to provide security may, instead, pay the claim in so far as doing so does not cause prejudice to the other creditors.

Article 308bis-12

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) The transfer of business assets is consummated where concordant decisions are taken within the subjects in question. The transfer of business assets is not effective vis-à-vis third parties until after the publication made in accordance with article 9 for each of the subjects participating in the transfer.

Article 308bis-13

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815))

(1) The transfer of business assets entails ipso iure transfer in favour of the receiving subjects of the assets and liabilities listed in the inventory.

(2) By derogation from subarticle (1), the transfer of industrial and intellectual property rights and of real rights other than real securities over movables and immovable is only binding as against third parties under the conditions set down by the special laws governing these transactions. The transferee subject or subjects may carry out these formalities themselves.

Article 308bis-14

(inserted by the Act of 23 March 2007 (Official Gazette A46 of 30/03/2007 p. 815)) The transfer of business assets may only be void in the following conditions:

a) it must be declared void by a court judgment;

b) where the transfer of business assets is carried out in accordance with article 308bis- 12, first paragraph, it may only be pronounced void for want of a written deed or, as the case may be, in the event of breach of the provisions of article 300, or if it is proved that the decision by the general meeting of any of the companies taking part in the transfer of business assets is void;

c) the action to set aside can no longer be raised after the expiry of a period of six months from the date on which the transfer of business assets is binding as against him who cites the fact it is void, or if the situation has been rectified;

d) where it is possible to remedy the irregularity liable to entail the transfer of business assets being void, the competent court grants the companies in question time to remedy the situation;

e) the decision declaring the transfer of business assets void is published according to the methods set down in article9;

f) a third-party application to set aside the decision declaring the transfer of business assets to be void can no longer be received after expiry of a period of six months from publication of the decision according to article 9;

g) the decision declaring the transfer of business assets to be void does not per se affect the validity of obligations arising to the burden or benefit of the transferee company prior to publication of the decision and after the date referred to in article 308bis-12, first paragraph;

h) the transferee subject is answerable for the obligations incumbent on him arising after the effective date of the transfer of business assets and before the date on which notice that the transfer of business assets is void was published. The transferor subject is also answerable for these obligations. However, the liability of the transferee subject is limited to the net assets that have been attributed to him.

PART XVI. CONSOLIDATED FINANCIAL STATEMENTS (ARTICLES 309 TO 344)

Sub-part 1. Terms and conditions for preparing consolidated financial statements (articles 309 to 317)

(heading inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872)

Article 309

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), supplemented by the Act of 2 December 1993 (Official Gazette A94 of 12/12/1993 p. 1740), the Act of 25 August 2006 (Official Gazette A152 of 31/08/2006 p. 2684), amended by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634), the Act of 30 July 2013 (Official Gazette A177 of 02/10/2013 p. 3384))

(1) Any public limited liability company, partnership limited by shares, private limited liability company and entity falling under article 77, second paragraph, points 2° and 3°, of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings, with the exception of credit institutions, insurance and reinsurance companies and open-ended pension savings companies, must prepare consolidated financial statements and a consolidated management report if

a) it has the majority of the voting rights of the shareholders or members of an undertaking, or

b) it has the right to appoint or recall the majority of the members of the administration, management or supervision organ of an undertaking and is at the same time a shareholder or member of that undertaking, or

c) it is a shareholder or member of an undertaking and alone or pursuant to an agreement entered into with other shareholders or members of that undertaking controls the majority of the voting rights of its shareholders or members. The European company (SE) having established its registered office in the Grand Duchy of Luxembourg is governed by provisions applicable to public limited liability companies.

(2) For the purposes of the this part, the entity holding the rights set forth in subarticle (1) is designated as the parent company. The undertakings is respect of which the rights referred to are held are designated as subsidiary undertakings.

Article 310

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872))

(1) For the purposes of article 309, subarticle (1), the parent company’s voting appointment or recall rights must be added to the rights of any subsidiary undertaking as well as those of any person acting in his own name but on behalf of the parent company or any other subsidiary undertaking.

(2) For the purposes of article 309, subarticle (1), the rights falling under subarticle (1) of this article must be reduced by the rights:

a) attaching to shares or units held on behalf of a person other than the parent company or a subsidiary undertaking, or

b) attaching to shares or units held as collateral provided that those rights are exercised in conformity with the instructions received or where holding those shares or units is part of the normal course of the lending business of the holder undertaking, provided that the voting rights are exercised in the interests of the security giver.

(3) For the purposes of article 309, subarticle (1), points a) and c), the entire voting rights of the shareholders or members of the subsidiary undertaking must be reduced by the voting rights attaching to shares or units held by that undertaking itself, by its subsidiary undertaking or by a person acting in his own name but on behalf of those undertakings.

Article 311

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), amended by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634))

(1) The parent company and all its subsidiary undertakings are to be consolidated, without prejudice to article 317, regardless of the location of the registered office of those subsidiary undertakings.

(2) For the purposes of subarticle (1), any subsidiary undertaking of a subsidiary undertaking is deemed as being that of the parent company that heads up those undertakings to be consolidated.

(3) Any parent company falling under article 309 that primarily holds one or more subsidiary companies to be consolidated that are credit institutions or insurance companies may submit itself, respectively, to the provisions of Division III of the amended Act of 17 June 1992 on the financial statements and consolidated financial statements of Luxembourg law credit institutions and the disclosure obligations of the accounting records of branches of credit institutions and of foreign law financial institutions for consolidation purposes or to the provisions of Division III of the amended Act of 8 December 1994 - on the financial statements and consolidated financial statements of Luxembourg law insurance and reinsurance companies - the obligations for drawing up and disclosing the accounting records of branches of foreign law insurance companies. The parent company making this election is relieved from the requirement to draw up consolidated financial statement in accordance with article 309.

Article 312

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), amended by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634))

(1) By derogation from article 309, subarticle (1), and without prejudice to articles 313 to 316, an exemption shall apply from the requirement to prepare consolidated financial statements and a consolidated management report for any financial holding company within the meaning of article 31, subarticle (2), of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings provided that all of the following conditions are met:

a) the financial holding company has not during the course of the financial year been directly or indirectly involved in the management of the subsidiary undertaking;

b) it has not during the financial year or during the five previous financial years exercised the voting rights attaching to its holding in the appointment of a member of the administration, management or supervision organ of the subsidiary undertaking or, where exercise of the voting right has been necessary to the functioning of the administration, management or supervision organs of the subsidiary undertaking, on condition that no shareholder or member that has the majority of the voting rights in the financial holding company and no member of the administration, management or supervision organs of the financial holding company or of its shareholder or member that has the majority of the voting rights forms part of the administration, management or supervision organs of the subsidiary undertaking and the members of those organs as appointed shall have exercised their duties free from any interference or influence from the financial holding company or any of its subsidiary undertakings;

c) it has granted loans only to undertakings in which it has a shareholding. If loans have been granted to other beneficiaries, they must have been repaid by the closing date of the financial statements of the previous financial year;

d) the exemption has been granted by the audit office for financial holding companies after verification that the aforementioned conditions have been fulfilled.

(2) a) An exempt financial holding company that does not prepare consolidated financial statements and a consolidated management report must state in the notes to its financial statements, by derogation from article 65, subarticle (2), of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings, the particulars provided for in article 65, subarticle (1), point 2, of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings for each majority holding in its subsidiary undertakings.

b) These particulars concerning majority holdings may nevertheless be omitted where they are such as would cause serious prejudice to the company, its shareholders or its members or any of its subsidiary undertakings. The omission of these particulars must be mentioned in the notes.

Article 313

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), amended by the Grand-Ducal Regulations of 22 December 2000 (Official Gazette A141 of 29/12/2000 p. 3292), replaced by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634))

(1) By derogation from article 309, subarticle (1), an exemption shall apply from the requirement to prepare consolidated financial statements and a consolidated management report for any parent company where, on its balance sheet date, the entities that ought to be consolidated do not, as a whole and on the basis of their latest financial statements, exceed two of the three following criteria:

– balance sheet total: 17.5 million euros;

– net turnover figure: 35 million euros;

– number of personnel employed full time and as an average over the financial period:

(2) The limits for which figures are given relative to the criteria for balance sheet total and net turnover figure may be increased by 20% where neither the set-off provided for in article 322, subarticle (1), nor the elimination provided for in article 329, subarticle (1), points a) and b), is carried out.

(3) The exemption does not apply to entities where one of the entities to be consolidated is a company whose securities are admitted to trading on a regulated market of a Member State of the European Community within the meaning of article 4, paragraph (1), point 14, of Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on markets in financial instruments.

(4) Article 36 of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings is applicable.

(5) The foregoing amounts may be amended by grand-ducal regulations.

Article 314

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), amended by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634))

(1) By derogation from article 309, subarticle (1), an exemption shall apply from the requirement to prepare consolidated financial statements and a consolidated management report for any parent company that is simultaneously a subsidiary undertaking where its own parent undertaking falls under the law of a Member State of the European Community in the following two cases:

a) the parent undertaking is the holder of all the shares or units in that exempt entity. The shares or units in that entity that are held by members of its administration, management or supervision organs pursuant to an obligation laid down by law or in the articles of association are not taken into consideration;

b) the parent undertaking holds 90% or more of the shares or units in the exempt entity and the other shareholders or members of that entity have approved the exemption.

(2) The exemption is subject to all the following conditions being met:

a) The exempt entity and, without prejudice to article 317, all its subsidiary undertakings are consolidated in the financial statements of a larger ensemble of undertakings whose parent undertaking falls under the law of a Member State of the European Community;

b) aa) the consolidated financial statements referred to in point a) together with the consolidated management report of the larger ensemble of undertakings are prepared by the parent undertaking of that ensemble and audited according to the law of the Member State under which that undertaking falls;

bb) the consolidated financial statements referred to in point a) and the consolidated management report referred to in point aa), together with the report by the person or persons charged with auditing those financial statements are published by the exempt entity according to the procedures laid down in article 9 of this act;

c) the notes to the financial statements of the exempt entity must include:

aa) the name and registered office of the parent undertaking preparing the consolidated financial statements referred to in point a);

bb) mention of the exemption from the obligation to prepare consolidated financial statements and a consolidated management report.

(3) The exemption does not apply to entities whose securities are admitted to trading on a regulated market of a Member State of the European Community within the meaning of article 4, paragraph (1), point 14, of Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on markets in financial instruments.

Article 315

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872)) In cases other than those provided for in article 314, subarticle (1), an exemption is provided from the obligation to prepare consolidated financial statements and a consolidated management report for any parent company that is simultaneously a subsidiary undertaking whose own parent undertaking falls under the law of a Member State of the European Community where all the conditions set forth in article 314 subarticle (2) are met and the shareholders or members of the exempt entity that hold shares or units in the subscribed capital of that entity to the extent of at least 10%, if the exempt entity is a public limited liability company or a partnership limited by shares, and at least 20%, if it is a private limited liability company, have not demanded the preparation of consolidated financial statements no later than six months before the end of the financial year.

Article 316

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), amended by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634), the Act of 30 July 2013 (Official Gazette A177 of 02/10/2013 p. 3384)) By derogation from article 309, subarticle (1), an exemption is provided from the obligation to prepare consolidated financial statements and a consolidated management report for any parent company that is simultaneously a subsidiary undertaking where its own parent undertaking does not fall under the law of a Member State of the European Community, if all the following conditions are met:

a) the exempt entity and, without prejudice to article 317, all its subsidiary undertakings are consolidated in the financial statements of a larger ensemble of undertakings;

b) the financial statements referred to in point a) and, as the case may be, the consolidated management report are prepared in conformity with the provisions of this article or in an equivalent manner;

c) the financial statements referred to in point a) have been audited by one or more persons licensed to audit financial statements under the national law under which the undertaking that prepared those financial statements falls. Article 314, subarticle (2), point b) bb) and point c), and subarticle (3) together with article 315 are applicable.

Article 317

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), supplemented by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634), amended by the Act of 30 July 2013 (Official Gazette A177 of 02/10/2013 p. 3384))

(1) An undertaking may be omitted from consolidation where it presents only a negligible interest having regard to the objective pursued by article 319, subarticle (3).

(2) Where two or more undertakings fulfil the criterion set out in subarticle (1), they shall nonetheless be included in the consolidation to the extent that those undertakings present a non-negligible interest having regarding to the objective pursued by article 319, subarticle (3). (2bis)Without prejudice to articles 312 and 313, a parent company within the meaning of article 309, subarticle (2), all of whose subsidiary undertakings present, both individually and collectively, a negligible interest having regard to the objective pursued by article 319, subarticle (3), is exempted from the obligation imposed in article 309, subarticle (1).

(3) Furthermore, an undertaking may be omitted from consolidation where:

a) severe and lasting restrictions substantially hinder exercise by the parent company of its rights pertaining to the assets or management of that undertaking;

b) the information necessary to prepare the consolidated financial statements according to this act cannot be obtained without disproportionate expense or without unjustified delay;

c) the shares or units in that undertaking are held exclusively for the purpose of their later transfer.

Article 318

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), repealed by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634)) [...]

Sub-part 2. Methods for preparing consolidated financial statements (articles 319 to 338)

Article 319

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), supplemented by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634))

(1) Consolidated financial statements comprise the consolidated balance sheet, the consolidated profit and loss account and the notes. These documents form a whole. Any entity falling under article 309, subarticle (1), has the option of incorporating other financial statements into the consolidated financial statements in addition to the documents provided for in the first paragraph.

(2) Consolidated financial statements must be prepared with clarity and in conformity with the provisions of this act.

(3) Consolidated financial statements must portray a fair view of the assets, liabilities, financial situation and results of the ensemble of undertakings comprised in the consolidation.

(4) Where application of this article is insufficient to give the fair view referred to in subarticle (3), additional information must be provided.

(5) If, in exceptional cases, the application of a provision of articles 320 to 338 and article 342 transpires to be contrary to the obligation laid down in subarticle (3), the provision in question shall be derogated from in order that a fair view within the meaning of subarticle (3) shall be given. Any such derogation must be mentioned in the notes and due reasons stated therefor, with particulars of its effect on the assets, liabilities, the financial situation and the results.

Article 320

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), amended by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634), the Act of 30 July 2013 (Official Gazette A177 of 02/10/2013 p. 3384))

(1) As regards the structure of consolidated financial statements, articles 28 to 34, 37 to 46 and 48 to 50 of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings are applicable, without prejudice to the provisions of this article and taking account of unavoidable adjustments resulting from the inherent characteristics of consolidated financial statements compared to financial statements.

(2) Stocks may be regrouped in consolidated financial statements if a detailed listing according to the layout set down in article 34 of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings is impracticable without incurring disproportionate expense.

(3) There may also be applied for the purposes of subarticles (1) and (2) the balance sheet layouts figuring in articles 10 and 10bis and the profit and loss account layouts to which reference is made in articles 22, paragraph 2, 23, 25 and 26 of Directive 78/660/EEC of the Council of 25 July 1978, based on Article 54(3)(g) of the Treaty on the annual accounts of certain types of companies, as amended. Furthermore, entities are also authorised to apply the provisions of article 4 of Directive 78/660/EEC in preparing their consolidated financial statements.

Article 321

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872)) The asset and liability items of the undertakings included in the consolidation are incorporated in full into the consolidated balance sheet.

Article 322

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), amended by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634), supplemented by the Act of 30 July 2013 (Official Gazette A177 of 02/10/2013 p. 3384))

(1) The book values of shares or units in the capital of the undertakings included in the consolidation are offset by the fraction of the equity of the undertakings included in the consolidation that they represent.

a) This set-off is effected on the basis of the book values existing on the date on which that undertaking is included in the consolidation for the first time. The differences resulting from the set-off are booked, in so far as possible, directly to the items in the consolidated balance sheet that have a value greater or less than their book value.

b) This set-off may also be effected on the basis of the value of the identifiable asset and liability items on the date of acquisition of the shares or units or, where the acquisition took place in several stages, on the date on which the undertaking became a subsidiary undertaking.

c) The difference remaining after application of point a) or that results from the application of point b) is entered on the consolidated balance sheet under an individual item with a corresponding caption. This item, the methods applied and, if they are significant, changes since the previous financial year must be described in the notes. Positive and negative differences may be offset on condition that a breakdown of these differences is given in the notes.

(2) However, subarticle (1) does not apply to shares or units in the capital of the parent company held either by it itself or by another undertaking comprised in the consolidation. Those shares or units are regarded in the consolidated financial statements as own shares or units in conformity with chapter II of title II of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings.

Article 323

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872))

(1) Instead of the method laid down in article 322, the consolidating entities may effect set-off between the book values of shares or units in the capital of an undertaking comprised in the consolidation and the corresponding fraction of just the capital of that undertaking on condition that:

a) the shares or units held represent 90% or more of the nominal value or, failing a nominal value, the accounting par of the shares of the undertaking other than those described in article 32-2, subarticle (2);

b) the proportion referred to in point a) has been attained pursuant to an arrangement providing for the issue of shares or units by an undertaking comprised in the consolidation;

c) the arrangement referred to in point b) does not make provision for a cash payment of more than 10% of the nominal value or, failing a nominal value, the accounting par of the shares or units issued.

(2) Any difference resulting from the provisions set down in subarticle (1) is added to the consolidated reserves or deducted from them, as the case may be.

(3) Application of the method described in subarticle (1), the movements resulting therefrom for the reserves together with the name and registered office of the undertakings concerned are stated in the notes.

Article 324

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872)) The amounts attributable to shares or units held in consolidated subsidiary undertakings by persons foreign to the undertakings comprised in the consolidation are entered on the consolidated balance sheet under a separate item captioned “Minority interests”.

Article 325

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872)) The income and expenses of the undertakings comprised in the consolidation are included in full in the consolidated profit and loss account.

Article 326

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872)) The amounts attributable to shares or units held, in the result of consolidated subsidiary undertakings, by persons foreign to the undertakings comprised in the consolidation are entered on the consolidated profit and loss account under a separate item captioned “Minority interests”.

Article 327

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872)) The consolidated financial statements are prepared according to the principles set down in articles 328 to 331.

Article 328

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872))

(1) The consolidation procedures may not be changed from one financial year to another.

(2) Derogations from subarticle (1) are permitted in exceptional cases. Where such derogations are applied, they must be pointed out in the notes and duly motivated, with particulars of their effect on the net assets, financial situation and results of the ensemble of undertakings comprised in the consolidation.

Article 329

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872))

(1) The consolidated financial statements show the assets and liabilities, financial situation and results of the undertakings comprised in the consolidation as if what is concerned were a single undertaking. In particular,

a) debts and claims between undertakings comprised in the consolidation are eliminated from the consolidated financial statements,

b) the income and expenses pertaining to transactions carried out between undertakings comprised in the consolidation are eliminated from the consolidated financial statements,

c) profits and losses resulting from transactions carried out between undertakings comprised in the consolidation and that are included in the book value of the assets are eliminated from the consolidated financial statements. These eliminations may be effected in proportion to the fraction of the capital held by the parent company in each of the subsidiary undertakings comprised in the consolidation.

(2) Subarticle (1), point c), may be derogated from where the transaction is contracted at arm’s length and elimination of the profits or losses risks incurring disproportionate expense. Derogations must be pointed out and, if they have a non-negligible influence on the assets and liabilities, financial situation and results of the ensemble of undertakings comprised in the consolidation, this fact must be stated in the notes to the consolidated financial statements.

(3) Derogations from subarticle (1), points a), b) and c), are permitted where the amounts concerned present a negligible interest having regard to the objective pursued by article 319, subarticle (3).

Article 330

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872))

(1) Consolidated financial statements are prepared at the same date as the financial statements of the parent company.

(2) However, the consolidated financial statements may be prepared at another date to take account of the balance sheet date of the largest number of, or largest, undertakings comprised in the consolidation. Where this derogation is applied, this is pointed out in the notes to the consolidated financial statements and duly motivated. Moreover, account shall be taken or mention made of significant events concerning the assets and liabilities, financial situation or results of an undertaking comprised in the consolidation occurring between the balance sheet date of that undertaking and the balance sheet date of the consolidated financial statements.

(3) If the balance sheet date of an undertaking comprised in the consolidation predates the closing balance sheet date of the consolidated financial statements by more than three months, that undertaking is consolidated on the basis of interim financial statements prepared at the closing balance sheet date of the consolidated financial statements.

Article 331

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872)) If the composition of the ensemble of undertakings comprised in the consolidation has undergone notable change during the financial year, the consolidated financial statements include information rendering a comparison of the successive consolidated financial statements meaningful. Where the change is significant, this obligation may be satisfied by preparing an adjusted opening balance sheet and an adjusted profit and loss account.

Article 332

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), amended by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634), the Act of 30 July 2013 (Official Gazette A177 of 02/10/2013 p. 3384)) (1) The asset and liability items included in the consolidation are valued according to uniform methods and in conformity with articles 7 and 7bis of chapter II of title II of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings.

(2) a) The entity that prepares the consolidated financial statements must apply the same valuation methods as are applied to its own financial statements. However, other valuation methods compliant with the aforementioned articles may be applied to the consolidated financial statements.

b) Where use is made of these derogations, they are pointed out in the notes to the consolidated financial statements and duly motivated.

(3) Where asset and liability items contained in the consolidation have been valued by undertakings comprised in the consolidation according to methods that are not uniform with those laid down for the consolidation, those items must be revalued in accordance with the methods laid down for the consolidation unless the result of that revaluation presents only a negligible interest having regard to the objective set down in article 319, subarticle (3). Derogations from this principle are permitted in exceptional cases, which shall be pointed out in the notes to the consolidated financial statements and duly motivated.

(4) Account is taken in the consolidated balance sheet and profit and loss account of the difference appearing in the consolidation between the tax charge attributable to the financial year and to previous financial years and the tax burden already paid or to be paid by virtue of those financial years in so far as it is probable that an actual charge will result for one of the consolidated undertakings in the foreseeable future.

(5) Where asset items included in the consolidation have been subjected to exceptional corrections of value solely for the purpose of applying the tax legislation, those items may only be included in the consolidated financial statements after elimination of such corrections. However, those items may be included in the consolidated financial statements without elimination of the corrections provided that their duly justified amount is specified in the notes to the consolidated financial statements.

Article 333

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), amended by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634))

(1) The individual item referred to in article 322, subarticle (1), point c), if corresponding to a positive consolidation difference, is treated according to the rules set down in article 59 subarticle (2) of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings.

(2) The positive consolidation difference may be immediately and clearly deducted from reserves.

Article 334

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872)) The amount shown in the individual item referred to in article 322 subarticle (1) point c), if corresponding to a negative consolidation difference, may only be shown in the consolidated profit and loss account:

a) if that difference corresponds to the forecast, on the acquisition date, of an unfavourable development in the future results of the undertaking concerned or the forecast expenditure that it will occasion and to the extent that that forecast turns out to be true, or

b) to the extent that the difference corresponds to a realised gain.

Article 335

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872))

(1) Where an undertaking comprised in the consolidation, jointly with one or more undertakings not comprised in the consolidation, manages another undertaking, that undertaking may be included in the consolidated financial statements pro rata to the rights held in its capital by the undertaking comprised in the consolidation.

(2) Articles 317 to 334 apply mutatis mutandis to the proportional consolidation referred to in subarticle (1).

(3) If this article is applied, article 336 does not apply where the undertaking subject to proportional consolidation is an associated undertaking within the meaning of article

Article 336

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), amended by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634), the Act of 30 July 2013 (Official Gazette A177 of 02/10/2013 p. 3384))

(1) Where an undertaking comprised in the consolidation exercises a notable influence on the management and financial policy of an undertaking not comprised in the consolidation (associated undertaking), in which it has a holding within the meaning of article 41 of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings, that holding is entered in the consolidated balance sheet under an individual item with a corresponding caption. It is presumed that an undertaking exercises a notable influence over another undertaking where it has 20% or more of the voting rights of the shareholders or members of that undertaking. Article 310 is applicable.

(2) The first time that application is made of this article to a holding falling under subarticle (1), it is entered in the consolidated balance sheet either:

a) at its book value valued in accordance with the valuation rules laid down in chapter II of title II of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings. The difference between that value and the amount corresponding to the fraction of equity represented by that holding is stated separately in the consolidated balance sheet or in the notes. This difference is calculated at the date on which the method is applied for the first time; or

b) at the amount corresponding to the fraction of the equity of the associated undertaking represented by that holding. The difference between that amount and the book value valued according to the valuation rules laid down in chapter II of title II of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings is stated separately in the consolidated balance sheet or in the notes. This difference is calculated at the date on which the method is applied for the first time.

c) The consolidated balance sheet or notes shall specify which of points a) or b) has been used.

d) For the purpose of points a) or b), the difference may be calculated on the acquisition date of the shares or units or, where the acquisition is effected in several stages, on the date on which the undertaking became an associated undertaking.

(3) Where asset or liability items of the associated undertaking have been valued according to methods that are not uniform with those laid down for the consolidation according to article 332, subarticle (2), those items may, for the purpose of calculating the difference referred to in subarticle (2), point a) or b) of this article, be revalued in accordance with the methods laid down for the consolidation. If no revaluation is done, mention of this must be made in the notes.

(4) The book value referred to in subarticle (2), point a) or the amount corresponding to the fraction of the equity of the associated undertaking referred to in subarticle (2), point b), is increased or reduced by the amount of the variance arising during the financial year in the fraction of the equity of the associated undertaking represented by that holding; it is reduced by the amount of the dividends corresponding to the holding.

(5) In so far as a positive difference referred to in subarticle (2), point a) or point b), cannot be linked to a category of asset or liability items, it is treated according to article 333 and article 342 subarticle (3).

(6) The fraction of the result of the associated undertaking that is attributable to those holdings is entered in the consolidated profit and loss account under a separate item with a corresponding caption.

(7) The eliminations referred to in article 329, subarticle (1) point c), are effected to the extent that the elements thereof are known or accessible. Article 329 subarticles (2) and (3) apply.

(8) Where an associated undertaking prepares consolidated financial statements, the provisions of the foregoing subarticles are applicable to the equity entered in those consolidated financial statements.

(9) Application of this article may be waived where the holdings in the capital of the associated undertaking represent only a negligible interest having regard to the objective pursued in article 319 subarticle (3).

Article 337

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), supplemented by the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295), amended by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634), the Act of 30 July 2013 (Official Gazette A177 of 02/10/2013 p. 3384)) Apart from the particulars required by other provisions of this part, the notes must include reference to:

1) The valuation methods applied to the various items in the consolidated financial statements, together with the methods used for calculating value corrections. For those items contained in the consolidated financial statements that are or originally were expressed in a foreign currency, the bases used for converting them into the currency in which the consolidated financial statements are prepared must be stated.

2) a) The name and registered office of the undertakings comprised in the consolidation; the fraction of the capital held in undertakings comprised in the consolidation other than the parent company, by the undertakings comprised in the consolidation or by a person acting in its name but on behalf of those undertakings; which of the conditions referred to in article 309 and after application of article 310 has formed the basis on which the consolidation has been carried out. However, this last particular is not necessary where the consolidation has been effected on the basis of article 309, subarticle (1) point a), and the fraction of capital and the proportion of the voting rights held are the same.

b) The same particulars must be given on undertakings omitted from the consolidation by dint of article 317 together with the grounds for excluding the undertakings referred to in article 317.

3) a) The name and registered office of the associated undertakings of an undertaking comprised in the consolidation within the meaning of article 336 subarticle (1), with particulars of the fraction of their capital held by undertakings comprised in the consolidation or by a person acting in his own name but on behalf of such undertakings.

b) The same particulars must be given on associated undertakings falling under article 336, subarticle (9), together with the grounds for applying this provision.

4) The name and registered office of the undertakings that have been subject to proportional consolidation pursuant to article 335, the factors from which the joint management arises, together with the fraction of their capital held by undertakings comprised in the consolidation or by a person acting in his own name but on behalf of such undertakings.

5) The name and registered office of the undertakings other than those falling under subarticles (2), (3) and (4) in which the undertakings comprised in the consolidation hold, either themselves or through a person acting in his own name but on behalf of those undertakings, at least twenty per cent of the capital, with particulars of the fraction of capital held together with the amount of the equity and of the result of the latest financial year of the undertaking concerned for which financial statements have been approved.

This information may be omitted where it is only of negligible interest having regard to the objective pursued by article 319 subarticle (3). Information on equity and the result may also be omitted where the undertaking concerned does not publish its balance sheet and it is directly or indirectly held to the extent less than of fifty per cent by the aforementioned undertakings.

6) The overall amount of the debts shown in the consolidated balance sheet whose remaining term exceeds five years together with the overall amount of the debts shown in the consolidated balance sheet that are covered by real securities given by undertakings comprised in the consolidation, with particulars of their nature and form.

7) The overall amount of the financial commitments not shown in the consolidated balance sheet, in so far as it is useful for it to be shown in order to gain an understanding of the financial situation of the undertakings comprised in the consolidation as a whole. Commitments relative to pensions, and commitments to related undertakings not comprised in the consolidation, must be shown separately. 7bis. The nature and commercial purpose of transactions not entered in the balance sheet together with the financial impact of such transactions, provided that the risks or benefits flowing from those transactions are significant and in so far as disclosure of these risks or benefits is necessary to gain an understanding of the financial situation of the entities included within the consolidation perimeter.

7ter. Transactions, except for transactions internal to the group, effected by the parent company or by any other entity included in the consolidation perimeter, with related parties, including the amounts of such transactions, the nature of the relationship with the related party and any other information on the transactions that is necessary to gain an understanding of the financial situation of the undertakings included within the consolidation perimeter, where these transactions present a significant importance and have not been entered into at arm’s length. The information on the various transactions may be aggregated according to their nature, except if separate information is necessary to understand the effects of the transactions with related parties on the financial situation of the undertakings including within the consolidation perimeter.

8) A breakdown of the net amount of the consolidated turnover defined in accordance with article 48 of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings by category of activity and by geographical market, to the extent that, from the viewpoint of organising the sale of the products and performance of the services corresponding to the ordinary business of the undertakings comprised in the consolidation as a whole, these categories and markets differ considerably inter se.

9) a) The average number of personnel employed during the financial year by the undertakings comprised in the consolidation, broken down into categories, and, unless mentioned separately in the consolidated profit and loss account, the personnel expenses related to the financial year.

b) The average number of personnel employed during the financial year by the undertakings to which article 335 is applied is stated separately.

10) The proportion in which the calculation of the consolidated result for the financial year has been affected by an evaluation of the items that, by derogation from the principles laid down in articles 51, 55, 56 and 59 to 64septies of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings and article 332 subarticle (5), has been done during the financial year or previously for the purpose of obtaining tax abatements. Where any such valuation has a non-negligible influence on the future tax burden of the undertakings comprised in the consolidation as a whole, relevant information must be given.

11) a) The difference between the tax burden charged to the consolidated profit and loss account for the financial year and previous financial years and the tax burden already paid or to be paid by dint of those financial years, in so far as this difference is of a certain interest having regard to the future tax burden. This amount may also be shown in a cumulative manner in the balance sheet under an individual item with a corresponding caption.

b) In the event of use of the fair value valuation method according to article 7bis of chapter II of title II of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings, deferred taxation liabilities must, as the case may be, figure as a cumulative amount in the balance sheet.

12) The remuneration allotted for the financial year to the members of the administration, management or supervision organs of the parent company by dint of their duties within the parent company and in its subsidiary undertakings, together with the amount of the commitments arising or contracted under the same conditions in relation to pension or retirement with respect to former members of the aforementioned organs. This information must be given as an overall figure for each category.

13) The amount of the advances and credit granted to members of the administration, management or supervision organs of the parent company by it or by a subsidiary undertaking, specifying the rate of interest, the essential terms and conditions and any amounts repaid, together with the commitments on their behalf in name of any form of guarantee. This information must be given as an overall figure for each category.

14) Separately, the total fees received during the financial year either by the accredited company auditor or accredited audit firm or by the statutory auditor or audit firm for statutory audit of the consolidated financial statements, the total fees received for other assurance services, the total fees received for tax advisory services and the total fees received for any service other than audit services.

15) Where the fair value valuation method is used for financial instruments in accordance with article 7bis of chapter II of title II of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings:

a) the main hypotheses underlying the valuation models and techniques used, in cases where the fair value has been determined according to article 64ter, subarticle (1), point b), of the said act;

b) per category of financial instruments, the fair value, variations in value entered directly in the profit and loss account and, in accordance with article 64quater of the said act, variations carried to the fair value reserve;

c) for each category of derivative financial instruments, particulars of the volume and nature of the instruments, and especially the main terms and conditions liable to affect the amount, timetable and certainty of future cash flows; and

d) a table showing movements booked in the fair value reserve over the financial year.

16) Where the fair value valuation method is not used for financial instruments in accordance with article 7bis of chapter II of title II of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings:

a) for each category of derivative instruments:

i) the fair value of the instruments, if that value can be determined using one of the methods laid down in article 64ter, subarticle (1), of the said act;

ii) particulars of the volume and nature of the instruments, and

b) for financial assets falling under article 64bis of the said act accounted for at an amount greater than their fair value and without use being made of the possibility to adjust their value according to article 55, subarticle (1), point

(c) aa), of the said act:

i) the book value of the assets in question, taken in isolation or grouped together appropriately;

ii) the reasons why the book value has not been reduced, and especially the nature of the factors whereby it is conceivable that the carrying value will be recovered.

17) Where the fair value valuation method is used to value certain categories of assets other than financial instruments according to article 7bis of chapter II of title II of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings:

a) the main hypotheses underlying the valuation models and techniques used in cases where the fair value has been determined by reference to a market value;

b) for each category of assets other than financial instruments, the fair value on the balance sheet date and variations in value occurring during the financial year;

c) for each category of assets other than financial instruments, particulars of the main terms and conditions liable to affect the amount and certainty of future cash flows.

Article 338

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872)

(1) It is permissible for the particulars required under article 337, points 2, 3, 4 and 5:

a) to take the form of a summary lodged according to article 9; mention shall be made of this in the notes;

b) to be omitted where they are such as could cause serious prejudice to one of the undertakings concerned by these provisions. The omission of these particulars must be mentioned in the notes.

(2) Point 1 b) also applies to the particulars required by article 337 point 8.

Sub-part 3. Consolidated management report (article 339) (heading inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872))

Article 339

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), amended by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634), the Act of 30 July 2013 (Official Gazette A177 of 02/10/2013 p. 3384))

(1) The consolidated management report contains at least an accurate narrative of development of the business, the results and the situation of all the entities comprised within the consolidation, together with a description of the main risks and uncertainties facing them. This narrative comprises a balanced, comprehensive analysis of the development of the business, the results and the situation of all the entities comprised within the consolidation, in relation to the volume and complexity of that business. In so far as is necessary for an understanding of the development of the business, results or situation of the entities, the analysis includes key performance indicators of a financial or, as the case may be, non-financial nature pertaining to the specific business activities of the entities, particularly information relative to environmental and personnel issues. In making its analysis, the consolidated management report contains, as the case may be, references to the amounts specified in the consolidated financial statements and additional explanations relating thereto.

(2) As regards these undertakings, the report also contains particulars of:

a) important events occurring after the closing of the financial year;

b) the foreseeable development of these undertakings as a whole;

c) the activities of these undertakings as a whole in relation to research and development;

d) the number and nominal value or, failing a nominal value, accounting par of all of the shares or units in the parent company held by that entity itself, by subsidiary undertakings or by a person acting in his own name but on behalf of those undertakings. These particulars may be given in then notes.

e) as regards the use of financial instruments by these undertakings and where that is relevant for a valuation of their assets, liabilities, financial situation and losses or profits:

– the objectives and policy of those undertakings relative to management of the financial risks including their policy concerning the hedging of each principal category of transactions provided for which use is made of hedge accounting, and

– the exposure of these undertakings to pricing risk, credit risk, liquidity risk and cash-flow risk.

f) a description of the main characteristics of the group’s internal control and risk management systems in relation to the process of preparing the consolidated financial statements in the event that a company has securities issued for trading on a regulated market within the meaning of article 4, paragraph 1, point (14), of Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on markets in financial instruments. In the event that the consolidated management report and the management report are presented in the form of a single report, this information must be given in the article of that report containing the corporate governance statement provided for in article 68bis of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings.

Where the information required by article 68bis of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings figures in a separate report published with the management report according to the procedures laid down in article 68 of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings, the information referred to in this letter shall also form part of the separate report.

(3) Where a consolidated management report is required in addition to the management report, the two reports may be presented in the form of a single report. It may be appropriate in preparing that single report to place the accent on the aspects assuming an importance for the entities included in the consolidation as a whole.

Sub-part 3bis. Obligation and liability concerning preparation and publication of the consolidated financial statements and the consolidated management report (article 339bis) (heading inserted by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634))

Article 339bis

(inserted by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634), amended by the Act of 30 July 2013 (Official Gazette A177 of 02/10/2013 p. 3384)) The members of the administration, management and supervision organs of the entity that prepares the consolidated financial statements and the consolidated management report are under a collective obligation to ensure that preparation and publication of the consolidated financial statements, the consolidated management report and, if prepared separately, the corporate governance statement to be provided according to article 69bis of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings are in conformity with the requirements of this act and, as the case may be, international accounting standards as adopted in accordance with Regulation (EC) no. 1606/2002 of the European Parliament and of the Council of 19 July 2002 on the application of international accounting standards. These organs act within the framework of the remit conferred upon them by law.

Sub-part 4. Audit of the consolidated financial statements (article 340) (heading inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872))

Article 340

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), amended by the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295), the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634))

(1) The entity that prepares consolidated financial statements must have them audited by one or more accredited company auditors.

(2) The accredited company auditor or auditors also give an opinion specifying whether the consolidated management report is or is not in accordance with the consolidated financial statements for the same financial year.

(3) The report by the accredited company auditor or auditors must include the following elements:

a) an introduction in which at least the consolidated financial statements are identified forming the subject-matter of the statutory audit, together with the presentation framework that has been applied in their preparation;

b) a description of the scope of the statutory audit, containing at least a specification of the standards according to which the statutory audit has been carried out;

c) an opinion clearly expressing the conclusions arrived at by the accredited company auditor or auditors as to the fairness of the view given by the consolidated financial statements, the compliance of those financial statements with the presentation framework laid down and, as the case may be, whether the applicable legal requirements have been heeded. It may take the form of an unqualified opinion, a qualified opinion, an adverse opinion or a statement indicating that it is impossible to issue an opinion if the accredited company auditor or auditors are unable to issue the opinion;

d) a reference to any issue whatsoever to which the accredited company auditor or auditors draw special attention, albeit without including a qualification in the opinion;

e) a view on whether or not the consolidated management report accords with the consolidated financial statements for the same financial year.

(4) The report is signed and dated by the accredited company auditor or auditors.

(5) In the event that the financial statements of the parent company are appended to the consolidated financial statements, the report by the accredited company auditor or auditors required by this article may be combined with the report by the accredited company auditor required by article 69 of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings.

Sub-part 5. Publication of consolidated financial statements (article 341) (heading inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872))

Article 341

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), amended by the Act of 19 December 2002 (Official Gazette A149 of 31/12/2002 p. 3630), the Act of 10 June 2009 (Official Gazette A151 of 29/06/2009 p. 2268), the Act of 18 December 2009 (Official Gazette A22 of 19/02/2010 p. 295), the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634), supplemented by the Act of 30 July 2013 (Official Gazette A177 of 02/10/2013 p. 3384))

(1) The duly approved consolidated financial statements and the consolidated management report together with the report prepared by the accredited company auditor or auditors charged with auditing the consolidated financial statements are published by the entity that prepared the consolidated financial statements in accordance with article 9. (1bis)The consolidated financial statements and the consolidated management report are prepared in one and the same language. To this end, the parent company may use the German or English languages instead of French.

(2) As regards and the consolidated management report, article 79, subarticle 1, paragraphs 2 and 3, of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings is applicable.

(3) Articles 80 and 81 of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings are applicable.

(4) Subarticle (2) does not apply to companies whose securities are admitted to trading on a regulated market in a Member State of the European Community within the meaning of article 4, paragraph (1), point 14, of Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on markets in financial instruments.

Sub-part 6. Consolidated financial statements prepared according to international accounting standards (articles 341bis to 341-1) (heading inserted by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634))

Article 341bis

(inserted by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634)) Entities whose securities are not admitted to trading on a regulated market in a Member State of the European Community within the meaning of article 4, paragraph (1), point 14, of Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on markets in financial instruments may derogate from the provisions of part XVI of this act and prepare their consolidated financial statements according to the international accounting standards adopted under the procedure laid down in article 6, paragraph 2, of Regulation (EC) No. 1606/2002 of the Parliament and of the Council of 19 July 2002 on the application of international accounting standards. In this case, the entities concerned nonetheless continue to be subject to the provisions of articles 309 to 316, 337, points 2 to 5, 9, 12 to 14, 338, subarticle (1), 339, 339bis, 340 and 341-1.

Article 341-1

(inserted by the Act of 29 July 1993 (Official Gazette A67 of 25/08/1993 p. 1191)) The consolidated financial statements may, in addition to being disclosed in the currency or accounting unit in which they are prepared, be disclosed in ECUs, using the exchange rate as of the consolidated balance sheet date. This rate is specified in the notes.

Sub-part 7. Miscellaneous provisions (articles 342 to 344) (heading inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), renumbered and amended by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634))

Article 342

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), amended by the Act of 30 July 2013 (Official Gazette A177 of 02/10/2013 p. 3384))

(1) When the first consolidated financial statements are prepared according to this part for an ensemble of undertakings among which there already existed prior to 1 January 1988 one of the relationships falling under article 309 subarticle (1), it is permissible for the purposes of article 322, subarticle (1), to take account of the book values of the shares and the fraction of equity they represent as at a date that may be at any time up to that of the first consolidation.

(2) Subarticle (1) applies mutatis mutandis to the valuation of the shares or units, or the fraction of equity that they represent in the capital, of an associated undertaking of an undertaking comprised in the consolidation for the purposes of article 336, subarticle (2), and the proportional consolidation referred to in article 335.

(3) Where the individual item referred to in article 322, subarticle (1), corresponds to a positive consolidation difference appearing prior to the date on which the first consolidated financial statements are prepared according to this part, it is permissible:

a) for the purposes of article 333, subarticle (1), for the limited period greater than five years provided for in article 59, subarticle (2), of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings to be calculated as from the date of preparation of the first consolidated financial statements according to this part, and

b) for the purposes of article 333, subarticle (2), for the deduction to be made from reserves at the date of preparation of the first consolidated financial statements according to this part.

Article 343

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), amended by the Act of 8 December 1994 (Official Gazette A118 of 28/12/1984 p. 281), repealed by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634)) [...]

Article 344

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), supplemented by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634), amended by the Act of 30 July 2013 (Official Gazette A177 of 02/10/2013 p. 3384))

(1) Undertakings between which there exist the relationships referred to in article 309, subarticle (1), and other undertakings that are in such a relationship with one of the aforementioned undertakings are related undertakings within the meaning of title II of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings and of this part. (1bis)The expression “related party” has the same meaning as in the international accounting standards adopted according to Regulation (EC) No. 1606/2002 of the European Parliament and of the Council of 19 July 2002 on the application of international accounting standards.

(2) Article 310 and article 311 subarticle (2) apply.

(3) Parent undertakings that are not in the legal form of a public limited liability company, European company (SE), partnership limited by shares, private limited liability company or entity falling under article 77, second paragraph, points 2° and 3°, of the amended Act of 19 December 2002 on the register of commerce and companies and the accounting and financial statements of undertakings and that, by dint thereof, are not obliged to prepare consolidated financial statements and a consolidated management report are excluded from the application of subarticle (1).

Article 344-1

(inserted by the Act of 11 July 1988 (Official Gazette A45 of 18/08/1988 p. 872), repealed by the Act of 10 December 2010 (Official Gazette A225 of 17/12/2010 p. 3634)) [...]