EXHIBIT 4.14
English Translation
Conditions of Profit Participation Certificates
of KRONOS International, Inc. (hereinafter referred to as "the corporation")
Section 1
Issue of profit participation certificates
The Certificate of Incorporation of the corporation provides for the creation of
a profit participation capital and the issuance of profit participation
certificates.
Section 2
Establishment of profit participation certificates
(1) The profit participation certificates are issued in the name of the
owner. Issued are DM 550,000,000.--, divided into 5,500,000 shares a DM
100,--. Initially one or more global certificates shall be issued for
the profit participation certificates. Single certificates shall be
issued only upon request of the owners of profit participation
certificates. The form of the profit participation certificates is
determined by the board of directors of the corporation.
(2) The profit participation certificates are assignable. The declaration
of assignment must be made in writing. If single profit participation
certificates have been issued, the assignment further requires the
transfer of possession of the certificate in order to be valid.
Section 3
Rights of the owners of profit participation certificates and comparison to the
rights of owners of common shares
(1) The profit participation certificates grant a right to distributions
prior to the dividends of the owners of common shares (Section 4) and a
right of redemption in the case of the termination of the profit
participation certificate relationship (Section 6).
(2) Further rights are not connected with the profit participation
certificates, in particular no right to participate in a stockholders'
meeting, no preemptive right in case of newly issued common shares of
the corporation and no right to a participation in liquidation proceeds
in case of a dissolution of the corporation.
Section 4
Distributions
(1) The owners of profit participation certificates receive an annual
distribution of 4% of the nominal amount of the profit participation
certificates out of the balance sheet profit which is prior to the
dividend of owners of common shares.
(2) There is no right to a distribution if and to the extent that a loss
would be caused thereby. If a distribution has not taken place for a
certain year, it shall not be made out of net income shown in
subsequent balance sheets.
(3) The distribution on profit participation certificates is payable on the
first bank working day after the ordinary stockholders' meeting that
approves the financial statements of the preceding fiscal year.
(4) The profit participation certificates are entitled to distributions
starting January 1, 2000, i.e., for the first time for the fiscal year
2000.
(5) For the calculation of the balance sheet profit under these profit
participation certificate conditions, the transfer of profits into
revenue reserves and the dissolution of reserves is not taken into
account.
Section 5
Duration
The duration of the profit participation certificate relationship is unlimited.
It can be terminated by each owner of a profit participation certificate as well
as by the corporation under observation of a notice period of one year to the
end of the fiscal year of the corporation. The profit participation certificate
relationship ends also in case of a dissolution of the corporation.
Section 6
Redemption
Subject to the provisions on the participation in losses, the profit
participation certificates shall be repaid at their nominal value. The amount to
be redeemed is payable on the first bank working day after the day of the
ordinary stockholders' meeting which approves the financial statements of the
fiscal year in which the termination of the profit participation certificate
relationship has become effective. The amount to be repaid shall bear interest
for the time between the effective date of the termination and the repayment
date at the same rate as distributions for the last fiscal year.
Section 7
Participation in losses
If the corporation shows a balance sheet loss, then the profit participation
certificate capital and the equity allocable to the common shares of the
corporation must be reduced proportionally. Until the termination of the profit
participation certificate relationship, profits of the following years are to be
used proportionally to fill up the profit participation certificate capital and
the equity allocable to the corporation's common shares.
Section 8
Subordination
The profit participation certificate capital is subordinated to all other
creditors. Consequently, in the case of a liquidation, all other creditors must
be satisfied first.
Section 9
Issuance of further profit participation certificates
The owners of profit participation certificates have no right that their profit
participation certificates have priority over claims of other profit
participation certificates yet to be issued.
Section 10
Protection of rights
The existence of the profit participation certificates remains unaffected by a
merger of the corporation with other corporations or a change of the corporate
form or a transfer of its assets to another person in consolidation or through
an increase or a decrease of its stated capital. Should such a transaction
affect the adequacy of the consideration for the profit participation
certificates substantially, then the rights of the owners of the profit
participation certificates shall be adapted to the changed circumstances by an
express and unilateral declaration of the corporation named "declaration of
modification" and made according to rules of equity (Section 315 BGB).
Section 11
Miscellaneous
(1) For the valid and timely giving of notice of the corporation to the
owners of profit participation certificates, a publication in the
German Federal Gazette is sufficient in all cases. A notice to the
individual owners of profit participation certificates is not
necessary.
(2) These conditions are subject to the laws of the Federal Republic of
Germany.
(3) The validity of these profit participation certificate conditions as
such remains unaffected, even if any provision of the profit
participation certificate conditions should be invalid or
unenforceable. In this case a provision is deemed applicable which is
valid and enforceable and which comes as close as possible to what was
intended by these conditions.