exv10w1



 




Exhibit 10.1




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.



     
(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
electronic 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







Articles of Association/May 24, 2005



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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 246,517,980.16 and is divided into seventy million
(70,000,000) bearer shares of the common stock and 26,296,086
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.



     
(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 management board shall be authorized, in the period
up to May 23, 2010, with the approval of the supervisory
board, to increase, on one or more occasions, the capital of the
company by up to a total of EUR 30,720,000.00 for cash by
the issue of new non-voting bearer preference shares (Authorized
Capital I). The number of shares has to increase in the
same proportion as the capital. The management board shall be
further authorized, with the approval of the supervisory board,
to decide on the exclusion of shareholders’ pre-emption
rights. Exclusion of pre-emption rights is admissible, however,
only for fractional amounts. The new shares may also be taken up
by financial institutions to be specified by the management
board, with the obligation to offer them to the shareholders
(indirect pre-emption rights). The management board shall be
further authorized, with the approval of the supervisory board,
to determine the further details of the implementation of the
capital increase out of Authorized Capital I. The
supervisory board shall be authorized to amend the Articles of
Association after complete or partial implementation of the
capital increase out of Authorized Capital I or after the expiry
of the authorized period in accordance with the amount of the
capital increase out of Authorized Capital I.



     
(4) The management 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 management 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 5,628,725.76 divided into a
maximum of 2,198,721 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







Articles of Association/May 24, 2005



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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.



     
(6) The capital stock of the Corporation is contingently
increased by a maximum of Euro 2,848,235.52 divided into a
maximum of 1,112,592 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 10,215,170.56 divided into a
maximum of 3,990,301 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 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.



     
(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.







Articles of Association/May 24, 2005



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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.



     
(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 5,000,000 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 5,000,000 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 3,000,000.
	 
	 	     
    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 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.







Articles of Association/May 24, 2005



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(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.




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 notice subject to a notice period of fourteen
(14) days. The meetings may be called in writing, by
telefax or by other electronic means of communication. The
invitation on the agenda must be stated in the notice of
meeting. Notwithstanding sentence 2, in urgent cases, this
period may be shortened and the meeting may be called by
telegram, telex or telephone.



     
(2) The meetings of the supervisory board shall in the
regular case be by personal attendance. It is, however,
admissible that meetings of the supervisory board be held by way
of a video conference or that individual supervisory board
members participate by way of video link, provided that in these
cases the passing of resolutions also takes place by the way of
a video conference or video link. Outside of meetings,
resolutions in writing, telegraph, telefax, telex, telephone or
electronic communication (e-mail etc.) are admissible, if this
is ordered by the chairman of the supervisory board, or in the
event of his being unable to act, by his deputy.



     
(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







Articles of Association/May 24, 2005



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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 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 outside of the meeting by personal
attendance (“Präsenzsitzung”), as outlined in sub
paragraph 2 with respect to resolutions 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. 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 apply mutatis mutandis with the proviso,
that the report can only be given to the supervisory board.



     
(4) The supervisory board shall issue rules of procedure
for the management board in accordance with
Article 7 (4).



     
(5) The supervisory board shall be entitled, without
resolution of the shareholders’ meeting, to make any
amendments to the Articles of Association which concern only the
wording.




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.







Articles of Association/May 24, 2005



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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$80,000.00 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) As a member of a Committee, a Supervisory Board member
shall receive, in addition, US$30,000.00 per year, or as
Chairman of a committee, US$50,000.00 per year, payable in each
case in four equal installments at the end of each calendar
quarter.



     
(5) The Company shall pay the remuneration of the
supervisory board members subject to statutory deductions.




C. Shareholders’ Meeting




ARTICLE 14




Calling of the Shareholders’ Meeting



     
(1) The shareholders’ meeting shall be called, in so
far as no shorter period is allowed by law, 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.







Articles of Association/May 24, 2005



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(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.



     
(4) The members of the management board and of the
supervisory board should personally attend the
shareholders’ meeting. If it is not possible for a member
of the supervisory board to attend at the place of the
shareholders’ meeting, in particular, because he is abroad
for cause, he may participate in the shareholders’ meeting
by sound and picture transmission.



     
(5) If a voting right is to be exercised by a proxy,
authorization in writing [“Textform”] shall be
sufficient.




ARTICLE 16




Date of the Ordinary Shareholders’ Meeting



     
The shareholders’ meeting which accepts the adopted annual
financial statement or, as the case may be, 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.



     
(5) The chairman can decide that the entire
shareholders’ meeting or extracts therefrom be transmitted
in sound and picture. Such transmission can even be in a form to
which the public has unlimited access. The form of the
transmission should be made known in the invitation.




IV.     Annual Financial Statement
and Disposition of Profits




ARTICLE 18




Business Year, Rendering of Accounts



     
(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.







Articles of Association/May 24, 2005



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(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.



     
(5) Sub paragraphs 2 and 3 shall apply
corresponding to group financial statements and to report on the
economic group position, as far as § 170 sub
paragraph 1 sentence 2 AktG is applicable to the
Company as Mother Company.




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.




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).







Articles of Association/May 24, 2005



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