Audi 2014 Annual Report Download - page 154

BASIS OF THE AUDI GROUP
DISCLOSURES REQUIRED UNDER TAKEOVER LAW
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The administrative rights include the right to participate in the
Annual General Meeting and the right to speak, ask questions,
table motions and exercise voting rights there. Shareholders
may assert these rights in particular by means of a disclosure
and avoidance action.
Each share carries an entitlement to one vote at the Annual
General Meeting. The Annual General Meeting elects the mem-
bers of the Supervisory Board to be appointed by it, as well as
the auditor; in particular, it decides on the ratification of the
acts of members of the Board of Management and Supervisory
Board, on amendments to the Articles of Incorporation and
Bylaws, as well as on capital measures, on authorizations to
acquire treasury shares and, if necessary, on the conducting of
a special audit, the dismissal of members of the Supervisory
Board within their term of office and on liquidation of the
Company.
The Annual General Meeting normally adopts resolutions by a
simple majority of votes cast, unless a qualified majority is
specified by statute. A control and profit transfer agreement
exists between AUDI AG and Volkswagen AG, Wolfsburg, as the
controlling company. This agreement permits the Board of
Management of Volkswagen AG to issue instructions. The
profit after tax of AUDI AG is transferred to Volkswagen AG.
Volkswagen AG is obliged to make good any loss. All Audi
shareholders (with the exception of Volkswagen AG) receive a
compensatory payment in lieu of a dividend. The amount of
the compensatory payment corresponds to the dividend that is
distributed in the same fiscal year to Volkswagen AG share-
holders for each Volkswagen ordinary share.
/ CAPITAL INTERESTS EXCEEDING 10 PERCENT OF
THE VOTING RIGHTS
Volkswagen AG, Wolfsburg, holds around 99.55 percent of
the voting rights in AUDI AG. For details of the voting rights
held in Volkswagen AG, please refer to the Management
Report of Volkswagen AG.
/ COMPOSITION OF THE SUPERVISORY BOARD
The Supervisory Board comprises 20 members. Half of them
are shareholder representatives elected by the Annual General
Meeting. The other half of the Supervisory Board are employee
representatives elected by the employees in accordance with
the German Codetermination Act. A total of seven of these
employee representatives are employees of the Company. The
Chairman of the Supervisory Board, normally a shareholder
representative elected by the members of the Supervisory
Board, ultimately has two votes in a second vote on the same
Supervisory Board motion following a tie vote, pursuant to
Section 13, Para. 3 of the Articles of Incorporation and Bylaws.
Section 9, Para. 3 of the Articles of Incorporation and Bylaws
stipulates that the term of office for a Supervisory Board
member elected to replace a Supervisory Board member who
has not fulfilled his term of office ends upon expiration of the
term of office of the Supervisory Board member leaving.
/ STATUTORY REQUIREMENTS AND PROVISIONS
UNDER THE ARTICLES OF INCORPORATION AND
BYLAWS ON THE APPOINTMENT AND DISMISSAL
OF MEMBERS OF THE BOARD OF MANAGEMENT
AND ON THE AMENDMENT OF THE ARTICLES OF
INCORPORATION AND BYLAWS
The appointment and dismissal of members of the Board of
Management are stipulated in Sections 84 and 85 of the
German Stock Corporation Act (AktG). Members of the Board
of Management are accordingly appointed by the Supervisory
Board for a period of no more than five years. A renewal of
the term of office, in each case for no more than five years, is
permitted. Section 6 of the Articles of Incorporation and
Bylaws further stipulates that the number of members of the
Board of Management is to be determined by the Supervisory
Board and that the Board of Management must comprise at
least two persons.
/ AUTHORIZATIONS OF THE BOARD OF MANAGEMENT
IN PARTICULAR TO ISSUE NEW SHARES AND TO
REACQUIRE TREASURY SHARES
According to stock corporation regulations, the Annual General
Meeting may grant authorization to the Board of Management
for a maximum of five years to issue new shares. The meeting
may authorize it, again for a maximum of five years, to issue
convertible bonds on the basis of which new shares are to be
issued. The extent to which the shareholders have an option on
these new shares is likewise decided upon by the Annual Gen-
eral Meeting. The acquisition of treasury shares is regulated by
Section 71 of the German Stock Corporation Act (AktG).
/ KEY AGREEMENTS BY THE PARENT COMPANY
THAT ARE CONDITIONAL ON A CHANGE OF
CONTROL FOLLOWING A TAKEOVER BID
AUDI AG has not reached any key agreements that are condi-
tional on a change of control following a takeover bid. Nor has
any compensation been agreed with members of the Board of
Management or employees in the event of a takeover bid.