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COMMERCIAL LAW

Lawsuit Examining the Company Shares and Rights

In General

The TCC accepts the principle of continuity of a shareholder’s shares

and rights in merger, spin-off and conversion transactions. Articles 140,

161 and 183 TCC regulate the main principles in relation to preserving

shareholders’ rights depending on the specificities of each transaction.

In principle, a shareholder’s existing rights should remain in place, and

should be adapted to the new merged, spun-off or converted company.

The lawsuit regulated under Art. 191 TCC serves to assess whether

shareholders’ rights are duly preserved, and the provisions of the TCC on

preserving shares and rights are duly applied.

Parties to the Lawsuit, Subject Matter and Jurisdiction

Any shareholder who alleges a violation of their rights may initiate

a lawsuit to examine their shares and rights. The code did not restrict

the right to file this type of lawsuit to the shareholders of the acquired

or spun-off company. It is argued that the shareholders of the acquired,

spun-off or acquiring companies may all initiate this lawsuit. With this

lawsuit, the claimant may allege that their rights to continue shareholding

are violated, that their shares or rights in the company were not duly

preserved or that the consideration paid was not adequate.

The defendant to the lawsuit will depend on the restructuring

transaction. In a merger transaction, the acquiring or the newly established

company shall be the defendant to such a lawsuit. In the event of a partial

spin-off, a shareholder may file the lawsuit against the company that has

acquired the assets allocated to said shareholder, and in the event of a

full spin-off to one or all companies. The converted company will be the

defendant in the event of conversion.

Art. 191 TCC regulates that the claimant may request an equalization

(offset) payment. Nevertheless this is different from the offset payment

made under Art. 141/2 TCC to shareholders in a merger transaction. An

offset payment may be made to a shareholder, provided that it does not

exceed 10% of the actual value of its shares, in order to avoid fractions

while determining the exchange rate of the merger transaction. The offset