Common use of Transfer of Profit Clause in Contracts

Transfer of Profit. (1) The subsidiary is obliged to transfer its entire profits to Deutsche Telekom AG during the term of the agreement. In corresponding application of § 301 AktG, the profit is deemed to be the net income, reduced by any loss carried forward from the previous year, that would have occurred under the relevant commercial law without the profit transfer. (2) The subsidiary may, with Deutsche Telekom AG’s consent, allocate amounts from net income to retained earnings (§ 272 (3) of the German Commercial Code (HGB)), except for any statutory reserves, to the extent that this is permissible under commercial law and economically justifiable based on a reasonable commercial assessment. The right to transfer profits arises at the end of the financial year. It falls due with the value date at this time. (3) If amounts have been allocated to other retained earnings during the term of this agreement, these amounts can be taken from other retained earnings and transferred as profit.

Transfer of Profit. (1) The subsidiary is obliged to transfer its entire profits to Deutsche Telekom AG during the term of the agreement. In corresponding application of § 301 AktG, the profit is deemed to be the net income, reduced by any loss carried forward from the previous year, that would have occurred under the relevant commercial law without the profit transfer. (2) The subsidiary may, with Deutsche Telekom AG’s consent, allocate amounts from net income to retained earnings (§ 272 (3) of the German Commercial Code (HGB)), except for any statutory reserves, to the extent that this is permissible under commercial com- mercial law and economically justifiable based on a reasonable commercial assessmentassess- ment. The right to transfer profits arises at the end of the financial year. It falls due with the value date at this time. (3) If amounts have been allocated to other retained earnings during the term of this agreement, these amounts can be taken from other retained earnings and transferred trans- ferred as profit.