Investor Presentaiton

Purchases of enterprises An acquisition can also be made by purchasing an enterprise or its parts, with the buyer acquir ing the rights, assets and liabilities connected with running the business. The sale and pur- chase agreement associated with the acquisi- tion must be approved by the general meeting or the shareholders of the company. Contributions to companies Another way of securing a share in a business is by making a financial or non-monetary con- tribution upon which the general meeting of the company must decide on a new share is- sue. The increase is registered at the Commer- cial Court. With some exceptions, in cases of non-monetary contributions, an independent valuation of the investment by an independent, generally accepted expert listed in a special register must be submitted. Transformations of companies (merger, transfer of assets to a share- holder, demerger, change of legal form and cross-border relocation) If several entities are controlled by one person, it is possible to consolidate or restructure them. In Czech legislation, mergers come under the category of transformations of businesses, which also include demergers of companies, transfers of assets to shareholders, any chang- es in a company's legal form and cross-border relocations. Transformations of businesses are possible even if the companies are in liq- uidation or insolvency proceedings. Trans- formations can be undertaken as national or cross-border transactions with legal entities registered in other EU or EEA countries, includ ing European Companies (Societas E uropaea). Probably the most frequent form of transfor- mation is the merger by acquisition: one of the companies carries on its activities and the other ceases to exist while its assets and li- abilities are transferred to the successor com- pany. Another option is the merger by forma- tion of a new company: all of the participating companies cease to exist, and their assets are transferred to a newly established successor company. From a financial point of view, carrying forward the tax losses of wound up companies is gener ally allowed. - Mergers are carried out on the basis of merger projects, subject to approval by the general meetings. ― The merger date can be determined either retrospectively or prospectively. 85

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