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EXHIBIT 3.1
ARTICLES OF ASSOCIATION
OF FRESENIUS MEDICAL CARE AKTIENGESELLSCHAFT
I. GENERAL TERMS
ARTICLE 1
FIRM NAME AND REGISTERED OFFICE
The Company is a stock corporation. The name of the Company is
Fresenius Medical Care
Aktiengesellschaft
The registered office of the Company is in Hof an der Saale.
ARTICLE 2
PURPOSE
(1) The purpose of the Company is
a) the development, production and distribution of as well as the
trading in health care products, systems and procedures,
including dialysis;
b) the projecting, planning, establishment, acquisition and
operation of health care businesses, including, but not limited
to, dialysis centers, also in separate enterprises or through
third parties as well as the participation in such dialysis
centers;
c) the development, production and distribution of other
pharmaceutical products and the provision of services in this
field;
d) the provision of advice in the medical and pharmaceutical areas
as well as the scientific information and documentation;
e) the provision of laboratory services for dialysis and
non-dialysis patients and homecare medical services.
The Company will operate itself or through subsidiaries at home and
abroad.
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(2) The Company shall be entitled to enter into any and all business
transactions and take any and all measures which seem to be necessary or
useful to achieve the purpose of the Company and may, in particular
without limitation, participate in other enterprises of the same or
similar kind, take over the management and/or the representation of such
enterprises, transfer company divisions, including essential company
divisions, to enterprises in which the Company holds an interest and
establish branches at home and abroad.
ARTICLE 3
NOTIFICATIONS AND PUBLICATIONS
(1) All notifications of the Company shall be made in the Bundesanzeiger
[Federal Gazette].
(2) English short versions of the notices of shareholders' meetings which
must provide for the place, date and time and the items on the agenda of
the shareholders' meeting and the prerequisites of participation in the
meetings as well as English short versions of the other notifications
shall also be published in The Wall Street Journal and in The New York
Times. With the consent of the supervisory board which must decide
unanimously on such consent, the management board may determine
deviations from this provision.
II. CAPITAL STOCK AND SHARES
ARTICLE 4
CAPITAL STOCK
(1) The capital stock of the Company amounts to Euro 239,994,112.00 and is
divided into seventy million (70,000,000) bearer shares of the common
stock and 23,747,700 non-voting bearer shares of the preferred stock.
In case of issuance of non-voting bearer shares of the preferred stock,
particulars thereof are set forth in Article 19.
No consent of the preferred shareholders shall be required for the
issuance of non-voting preferred shares which, for the distribution of
the profits or the corporate assets, will be equal to or be preferred to
the non-voting preferred shares existing from time to time.
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(2) The capital stock in the amount of DM 100,000 available at the
transformation was raised through change of the legal form of Fresenius
Medical Care GmbH with registered office in Hof an der Saale, the
previous legal entity owning the assets and liabilities of the Company.
(3) The Managing Board shall be authorized, with the approval of the
Supervisory Board, to increase the capital stock of the company during
the period up to 29 May 2005 by a maximum amount of EUR 30,720,000.00
through the non-recurrent or recurrent issue of new non-voting bearer
preference shares (Authorized Capital I). The number of shares has to
increase in proportion to the capital stock. The increases in capital
have to take place against cash contributions. The Managing Board shall
also be entitled, in each case subject to the approval of the
Supervisory Board, to decide on an exclusion of the subscription right
of the shareholders. However, such an exclusion of the subscription
right shall only be permissible for fractional amounts.
(4) The Managing Board shall be authorized, with the approval of the
Supervisory Board, to increase the capital stock of the Corporation
during the period up to 22 May 2006 by a maximum amount of Euro
20,480,000.00 through the non-recurrent or recurrent issue of new
non-voting bearer preference shares (Authorized Capital II). The number
of shares has to increase in proportion to the capital stock. The
increases in capital may take place against cash contributions or
contributions in kind. The Managing Board shall also be entitled, in
each case subject to the approval of the Supervisory Board, to decide on
an exclusion of the subscription right of the shareholders. However,
such an exclusion of the subscription right shall only be permissible
if, in case of a capital increase against cash contributions, the issue
price is not significantly lower than the stock exchange price, and/or,
in case of a capital increase against contributions in kind, the purpose
of such increase is to acquire an enterprise or an interest in an
enterprise.
(5) The capital stock of the Corporation is contingently increased by a
maximum of Euro 6,144,000, divided into a maximum of 2.4 million par
value shares, through the issue of new, non-voting bearer preference
shares. The conditional capital increase will be made only to the extent
that the holders of the convertible bonds issued by Fresenius Medical
Care Aktiengesellschaft on the basis of the authority of the
shareholders' meeting of September 24, 1996 will exercise their rights
to convert the bonds into new shares. The new shares will participate in
the profits as from the beginning of the business year in which they are
created as a result of exercise of conversion rights.
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(6) The capital stock of the Corporation is contingently increased by a
maximum of Euro 3,072,000, divided into a maximum of 1.2 million par
value shares, through the issue of new, non-voting bearer preference
shares. The conditional capital increase will be made only to the extent
that subscription rights are granted pursuant to the stock option
program in accordance with the resolution passed at the shareholders'
meeting of June 10, 1998, and of the resolution of the shareholders'
meeting of May 30, 2000, and the owners of the subscription rights
exercise their subscription rights. The new non-voting bearer shares of
the preferred stock will participate in the profits as from the
beginning of the business year in which issuance occurs.
(7) The capital stock of the Corporation is contingently increased by a
maximum of Euro 10,240,000, divided into a maximum of 4 million
non-voting bearer preference shares, through the issue of new non-voting
bearer preference shares in order to secure the convertible bonds
adopted by resolution in the general meeting of 23 May 2001. The
contingent capital increase shall only take place insofar as convertible
bonds for par value shares are issued according to the international
participation scheme for employees pursuant to the resolution of the
general meeting of 23 May 2001 and insofar as the holders of such
convertible bonds exercise their conversion right. The new non-voting
bearer preference shares shall participate in profits as of the start of
the fiscal year in which they are issued.
(8) In case of a capital increase, the profit participation may be
determined in derogation of Section 60, para. 2 AktG [German Corporation
Law].
ARTICLE 5
SHARES
(1) The shares will be no par value bearer shares.
(2) The Company shall be entitled to issue share certificates made out to
bearer each evidencing a plurality of shares (several-share
certificates).
(3) The form of the share certificates and of the dividend coupons and
renewal coupons shall be determined by the management board with the
consent of the supervisory board.
(4) The Company shall take the necessary measures to achieve that its shares
will, as far as possible, be admitted for official quotation on the
stock exchange in
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Frankfurt am Main and in suitable form - e.g. as "American Depositary
Shares" - on the New York Stock Exchange and that such admissions will
be maintained. With the consent of the supervisory board which must
decide unanimously on such consent, the management board may determine
deviations from this provision.
III. CONSTITUTION OF THE COMPANY
A. MANAGEMENT BOARD
ARTICLE 6
COMPOSITION
(1) The management board shall consist of at least two (2) persons. The
supervisory board may provide for a greater number. The supervisory
board may also appoint deputy management board members. Until the
first-time appointment of one or more further management board members,
the management board shall consist of one person even if the Company's
balance sheet total exceeds DM 3 million.
(2) The resolutions of the management board shall be adopted by a simple
majority of the votes unless otherwise required by law. If a chairman of
the management board has been appointed, he shall have the casting vote
in case of a tie.
ARTICLE 7
REPRESENTATION OF THE COMPANY
(1) The Company shall be represented by two (2) members of the management
board or by one (1) member of the management board jointly with a
"Prokurist". Until the entry of one or more further management board
members, the Company will be represented by one management board member
alone. The power of prokura is to be granted only as joint power of
prokura subject to the restrictions referred to in Article 7 (3) below.
(2) The supervisory board may grant the right of individual representation
to individual or several management board members and revoke such right
at any time. The supervisory board may appoint a chairman of the
management board.
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(3) The express prior consent of the supervisory board shall be required for
the following:
a) acquisition, alienation or encumbrance of real estate and
equivalent rights if and to the extent that, in the individual
case, an amount of Euro 2,556,459.41 or, in case of encumbrance,
the security for the allowed credit line is exceeded;
b) acquisition, establishment, alienation of or charges on
shareholdings in other enterprises if and to the extent that an
amount of Euro 2,556,459.41 is exceeded in the individual case;
c) starting of new, and the discontinuance of existing, lines of
business or establishments;
d) conclusion of any legal transaction of the Company with or
toward another undertaking holding the majority of the shares in
the Company within the meaning of Section 16 AktG or with or
toward an enterprise affiliated with such undertaking within the
meaning of Section 15 AktG if and when such legal transaction is
beyond the ordinary course of business or the amount involved in
such legal transaction exceeds Euro 1,533,875.64.
e) consenting to the performance of any of the above legal acts by
an affiliated company.
f) conclusion, modification or termination of contracts between
business enterprises within the meaning of Sections 291 et seq.
AktG.
(4) Notwithstanding the overall responsibility of the management board, the
supervisory board shall, in particular in rules of procedure for the
management board, assign the management board duties to the individual
management board members and, within the framework of the imperative
legal provisions and the Articles of Association, determine the
relations of the management board members among each other and with the
Company and, in extension of Article 7 (3) above, define the acts for
which the management board shall require the express prior consent of
the supervisory board. The supervisory board may give consents pursuant
to Article 7 (3) above also generally, with or without time limit and
also to individual members of the management board, in particular, the
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chairman of the management board. The supervisory board may, at any
time, extend, restrict or revoke the rules of procedure for the
management board.
B. SUPERVISORY BOARD
ARTICLE 8
ELECTION AND TERM OF OFFICE OF THE SUPERVISORY BOARD
(1) The supervisory board consists of six (6) members.
All six (6) members shall be elected by the shareholders' meeting
according to the provisions of the German Aktiengesetz.
(2) Unless expressly otherwise resolved by the shareholders' meeting, the
supervisory board members shall be appointed to hold office until the
end of the ordinary shareholders' meeting which resolves on the
exoneration for the fourth business year after commencement of the term
of office. The year in which the term of office commences shall not be
considered for this calculation. Reelection of supervisory board members
shall be permissible.
(3) If a member elected by the shareholders' meeting withdraws from the
supervisory board before expiration of his term of office, a new member
is to be elected in the next shareholders' meeting to replace the
withdrawing member. The newly elected member shall hold office for the
remaining term of office of the withdrawing member.
(4) The shareholders' meeting may, for the supervisory board members to be
elected by it, appoint substitute members who will become members of the
supervisory board on the basis of a specific order to be determined upon
election if and when supervisory board members withdraw before
expiration of their term of office. Their position as substitute members
shall revive if and when the shareholders' meeting elects a new member
instead of the withdrawing supervisory board member replaced by such
substitute member. The term of office of the substitute member shall end
upon completion of the shareholders' meeting in which an election
according to Article 8 (3) is made.
(5) Each member of the supervisory board may resign from office by giving
one month's written notice to the chairman of the supervisory board even
without good cause. Notice of resignation from office by the chairman of
the supervisory board shall be given to his deputy.
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ARTICLE 9
CONSTITUTION OF THE SUPERVISORY BOARD
(1) Following the shareholders' meeting in which the supervisory board has
been newly elected, the supervisory board shall hold a meeting without
special notice of meeting and, where necessary, shall elect in such
meeting from among its members a chairman and a deputy chairman for the
whole term of office of the elected persons as supervisory board
members.
(2) If the chairman or his deputy resigns his office before expiration of
his term of office, the supervisory board shall immediately hold a new
election to replace the resigning chairman/deputy.
ARTICLE 10
MEETINGS AND RESOLUTIONS OF THE SUPERVISORY BOARD
(1) The meetings of the supervisory board shall be called by the chairman by
written notice subject to a notice period of fourteen (14) days. The
individual items on the agenda must be stated in the notice of meeting.
In urgent cases, this period may be shortened or the meeting may be
called by telegram, telex, telefax or telephone.
(2) The resolutions of the supervisory board shall be adopted in meetings.
The resolutions may be passed by written document, by telegram, telex,
telefax or telephone if the chairman of the supervisory board or, in
case of the chairman being prevented, his deputy so directs and all
members of the supervisory board approve of such procedure expressly or
by voting.
(3) The supervisory board shall constitute a quorum if half the members
making up the entire board take part in the adoption of the resolution.
Those items on the agenda which have not been announced properly within
the meaning of para. (1) above may be voted on only if none of the
present members objects thereto.
(4) If members of the supervisory board are prevented from attending the
meeting, they may have another member of the supervisory board submit
their written votes. Such delivery of the written vote shall be deemed
to be participation in the adoption of the resolution.
(5) Resolutions of the supervisory board shall require the majority of the
votes cast unless otherwise provided by law or the Articles of
Association. In case of a tie, a
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new vote shall be taken on the same issue at the request of the chairman
of the supervisory board or of another member of the supervisory board.
In the event that such new vote leads again to a tie, the chairman of
the supervisory board shall have two (2) votes (to the legally
permissible extent, this shall apply also to committees of the
supervisory board of which he is a member). Article 10 (4) shall be
applicable to the casting of the second vote. The deputy of the chairman
of the supervisory board shall not be entitled to such second vote.
(6) Minutes of the meetings of the supervisory board shall be prepared and
translated into the English language. The minutes shall be signed by the
chairman of the meeting. Any minutes to be prepared with respect to
resolutions adopted by written document, by telegram, telex, telefax or
telephone shall be signed by the chairman of the supervisory board.
ARTICLE 11
RIGHTS AND DUTIES OF THE SUPERVISORY BOARD
(1) The supervisory board shall have the rights and duties defined by
imperative legal provisions and these Articles of Association.
(2) The supervisory board shall, at any time, have the right to supervise
the entire management of the management board and to inspect and audit
all books and records, including the minutes of the meetings of the
management board, as well as the assets of the Company. This right to
inspect and audit can also be claimed by any individual supervisory
board member; if the management board objects to this right, it may be
enforced only if and when the request is supported by another
supervisory board member. The supervisory board member must direct his
request to the chairman of the supervisory board who shall pass the
request on to the management board or, if a chairman of the management
board has been appointed (Art. 7 (2) sentence 2), to such chairman.
(3) The management board shall regularly report to the supervisory board. In
addition, the supervisory board may request the submission of a report
if and when there is reasonable cause therefor including where such
cause relates to a business event at an affiliated company which has
become known to the management board and which may substantially
influence the situation of the Company. Article 11 (2), sentences 2 and
3 shall apply mutatis mutandis.
(4) The supervisory board shall issue rules of procedure for the management
board in accordance with Article 7 (4).
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(5) The supervisory board shall be entitled, without resolution of the
shareholders' meeting, to make amendments to the Articles of Association
which concern only the wording. This shall also apply to the cases
referred to in Article 4 (3).
ARTICLE 12
RULES OF PROCEDURE OF THE SUPERVISORY BOARD
The supervisory board shall, within the framework of the imperative legal
provisions and the Articles of Association, establish rules of procedure for
itself which shall take into account, in particular, the interests of those
supervisory board members who do not speak German.
ARTICLE 13
REMUNERATION OF SUPERVISORY BOARD MEMBERS
(1) The members of the supervisory board shall be reimbursed for the
expenses incurred in the exercise of their office, including any
value-added tax.
(2) Each member of the Supervisory Board shall receive a fixed fee of US$
60,000.00 per annum for each full fiscal year, payable in four equal
installments at the end of each calendar quarter.
In the event that the shareholders' meeting, taking into consideration
the annual results, resolves a higher remuneration by a three fourths
majority of the votes cast, such higher remuneration shall be payable.
(3) If a business year is no complete calendar year, the remuneration shall
be paid on a pro rata temporis basis. The chairman of the supervisory
board shall receive twice the remuneration of a supervisory board
member, and his deputy shall receive one and a half times the
remuneration of a supervisory board member.
(4) The Company shall pay the remuneration of the supervisory board members
subject to statutory deductions.
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C. SHAREHOLDERS' MEETING
ARTICLE 14
CALLING OF THE SHAREHOLDERS' MEETING
(1) The shareholders' meeting shall be called no later than one month before
the day by the end of which the shares must be deposited according to
Article 15 of these Articles of Association with the day of calling and
the day of deposit not to be considered for such calculation.
(2) No later than on the last day of the convocation period, also the
English short version pursuant to Article 3 (2) shall be published.
(3) The shareholders' meeting shall be held at the place where the
registered office of the Company is located, or in a German city where a
stock exchange is situated or at the place where the registered office
of a domestic affiliated company is located.
ARTICLE 15
ATTENDANCE AT THE SHAREHOLDERS' MEETING
(1) Those shareholders shall be entitled to attend the shareholders' meeting
who deposit their shares no later than on the fifth day before the
shareholders' meeting with the Company, or a Notary in the Federal
Republic of Germany, or a Wertpapiersammelbank [bank for the central
depository of securities] or with any other body designated in the
notice of meeting, during the business hours until the end of the
shareholders' meeting. If the credit institutions are closed on the last
day of deposit, the period of deposit shall end on the preceding working
day of the credit institutions.
(2) If the shares are deposited with a German Notary or with a
Wertpapiersammelbank, the certificate to be issued by them shall be
submitted to the cash office of the Company no later than on the first
working day, except the Saturday, after expiration of the period of
deposit.
(3) Shares shall be deemed to have been properly deposited if they are
blocked until the end of the shareholders' meeting at a credit
institution in the name of and with the consent of a depository.
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ARTICLE 16
DATE OF THE ORDINARY SHAREHOLDERS' MEETING
The shareholders' meeting which accepts the adopted annual financial statement
or, as the case may me, resolves on the adoption of the annual financial
statement and on the approval of the actions of the management board and the
supervisory board and on the disposition of the profits (ordinary shareholders'
meeting) shall be held within the first eight (8) months of a business year.
ARTICLE 17
CHAIRMANSHIP AT THE SHAREHOLDERS' MEETING AND VOTING
(1) The shareholders' meeting shall be chaired by the chairman of the
supervisory board or, if he is prevented or at the request of the
chairman of the supervisory board, by another supervisory board member
to be designated by the chairman of the supervisory board. If and when
no such designation has been made and the chairman of the supervisory
board is prevented, another member to be designated by the supervisory
board shall preside over the shareholders' meeting.
(2) The chairman shall chair the meeting, determine the order of items to be
dealt with as well as the kind and form of the voting.
(3) The majorities of the votes cast and of the capital stock represented
for the adoption of the resolution which are required for the
resolutions of the shareholders' meeting shall be governed by the
statutory provisions. In case of a tie, a motion shall be deemed denied.
(4) Each share of the common stock shall grant one (1) vote in the
shareholders' meeting. The preferred shares shall be non-voting, unless
otherwise required by imperative legal provisions; otherwise, sentence 1
of this paragraph shall apply mutatis mutandis.
IV. ANNUAL FINANCIAL STATEMENT AND DISPOSITION OF PROFITS
ARTICLE 18
BUSINESS YEAR, RENDERING OF ACCOUNTS
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(1) The business year shall be the calendar year.
(2) Within the first three (3) months of the business year but no later than
within the maximum period required by imperative legal provisions, the
management board shall prepare the annual financial statement and the
management report for the preceding business year and submit the same to
the auditors.
(3) Immediately after receipt of the auditor's report, the management board
shall submit to the supervisory board the annual financial statement,
the management report and the auditor's report.
(4) At the same time, the management board shall submit to the supervisory
board the proposal which he intends to make to the shareholders' meeting
in respect of the disposition of profits.
ARTICLE 19
DISPOSITION OF PROFITS
(1) The shareholders' meeting shall resolve on the disposition of the
balance sheet profits subject to the following paragraphs (2) to (4) of
this Article.
(2) Out of the annual balance sheet profits, the non-voting preferred shares
(Article 4) shall receive a dividend which exceeds that for the common
shares by an amount of Euro 0.06 per preferred share, but at least a
dividend in an amount of Euro 0.12 per preferred share.
(3) The minimum dividend of Euro 0.12 per preferred share shall take
precedence over the distribution of a dividend on the common shares.
(4) In the event that the balance sheet profits for one or more business
years are insufficient to distribute Euro 0.12 per preferred share, the
lacking sums shall be paid subsequently without interest out of the
balance sheet profits for the following business years, i.e. after
distribution of the minimum dividend on the preferred shares for these
business years and before distribution of a dividend on the common
shares. The right to subsequent payment shall be part of the profit
share for the business year from the balance sheet profits of which the
subsequent payment on the preferred shares is made.
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V. FORMATION EXPENSES
ARTICLE 20
FORMATION EXPENSES
The formation expenses (Notary's fees, court costs, costs of notification)
amount up to DM 5,000 (in words: five thousand German Marks).