Porsche 2011 Annual Report Download - page 230

As part of the basic agreement and the associated agreements implementing it, Porsche SE additionally
entered into agreements with Volkswagen AG and entities of the Porsche Zwischenholding GmbH group
including the following:
· Porsche SE holds Volkswagen AG as well as Porsche Zwischenholding GmbH and Porsche AG harmless from
obligations resulting from certain litigation, tax liabilities (plus interest) and for certain major losses.
· In addition, Porsche SE has granted Volkswagen AG various guarantees regarding Porsche Zwischenholding
GmbH and Porsche AG. These relate, among other things, to the proper issue and full payment of the shares
in Porsche AG, to the ownership of shares in Porsche Zwischenholding GmbH and Porsche AG as well as to
the licenses, permits and industrial property rights required for Porsche AG’s operations.
· Volkswagen AG will hold Porsche SE harmless from certain financial guarantees issued by Porsche SE to the
creditors of entities in the Porsche Zwischenholding GmbH group for the amount of its share in Porsche
Zwischenholding GmbH’s capital (please refer to note [21]).
· Should loan obligations of Porsche Zwischenholding GmbH or Porsche AG due to Porsche SE fall due and be
uncollectible in the event of insolvency of Porsche Zwischenholding GmbH or Porsche AG, Volkswagen AG will
assume these obligations provided it would have been possible when they fell due to offset the obligations
against claims against Porsche SE had the companies not become insolvent (please refer to note [12]).
· Porsche SE has pledged a loan receivable due from Porsche Zwischenholding GmbH and 70 million of the
ordinary shares that it holds in Volkswagen AG as collateral for two loan liabilities to entities of the Porsche
Zwischenholding GmbH group (please refer to notes [12] and [19]).
· In addition, Porsche SE will under certain circumstances hold Porsche Zwischenholding GmbH, Porsche AG
and their legal predecessors harmless from tax burdens that go beyond the obligations from periods up until
and including 31 July 2009 accounted for at the level of these entities.
Porsche SE and Volkswagen AG granted each other put and call options relating to the remaining
50.1% share held by Porsche SE in Porsche Zwischenholding GmbH, which was held in trust on behalf of
Porsche SE until 31 December 2011. Porsche SE can exercise the put option from 15 November 2012 until
the end of the day on 14 January 2013 and again from 1 December 2014 until the end of the day on
31 January 2015. Volkswagen AG can exercise the call option as of 1 March 2013 until the end of the day on
30 April 2013 and again from 1 August 2014 until the end of the day on 30 September 2014. The exercise
price for the two options is €3,883 million and subject to certain adjustments (for the carrying amounts of
these options and collateral provided, reference is made to notes [12] and [20]). Volkswagen AG (in the event
that it exercises its call option) as well as Porsche SE (in the event that it exercises its put option) have both
agreed to bear any tax expenses arising from exercising the options and from any downstream measures with
respect to the investments in Porsche Zwischenholding GmbH (e.g., from back taxes on the 2007 and/or 2009
spin-off). Should Volkswagen AG, Porsche Zwischenholding GmbH, Porsche AG or their respective subsidiaries
enjoy tax advantages as a result of subsequent taxation of the 2007 and/or 2009 spin-off, the purchase price
payable by Volkswagen AG for transfer of the remaining 50.1% share in Porsche Zwischenholding GmbH will be
increased by the present value of the tax advantages in the event that Porsche SE exercises its put options.
230 FINANCIALS