Discussed below are the material transactions and legal relationships that have existed between the Company and other companies of our Group, on the one hand, and related parties and companies, on the other, in the fiscal years 2008, 2007 and 2006, as well as in 2009 until the date of this offering circular. Business relations among companies of our Group are not discussed here.
Companies and persons deemed to be related to Deutsche Wohnen AG under International Accounting Standard (“IAS”) 24 are:
k companies of our Group that are controlled by Deutsche Wohnen AG, in which the Company holds an
investment interest that provides the Company with significance influence, or in whose joint management the Company participates;
k companies associated with Deutsche Wohnen AG for purposes of IAS 28 that are not consolidated by
Deutsche Wohnen AG, and joint ventures in which the Company is a partner company;
k members of the management board and the supervisory board of Deutsche Wohnen AG and their direct
family members, as well as companies controlled by members of the management board or supervisory board of the Company or their direct family members, or in which such persons exert material influence, or in which they directly or indirectly hold a substantial share of voting rights; and
k the shareholders of the Company whose shareholdings grant them a significant influencing power over the
Company, and all companies and enterprises in which such shareholders can exert a controlling influence and/or in which these shareholders hold more than 50% of the voting rights.
Business Relationships between Deutsche Wohnen AG and Companies of the Deutsche Wohnen Group
Agency agreements
Deutsche Wohnen AG and some Group companies entered into agency agreements with various Group companies, effective July 1, 2008, under which Deutsche Wohnen AG, Deutsche Wohnen Service GmbH, Deutsche Wohnen Management GmbH, Deutsche Wohnen Vertrieb GmbH, Deutsche Wohnen Kunden- betreuung GmbH, and Deutsche Wohnen Technik GmbH provided various services to the respective other party. Those services included, among other things, services in the areas of leasing and sales management, consulting to residents and tenants, rent and receivables management, central purchasing and contract administration, customer service, technical management including maintenance and modernization, per- sonnel, legal and financial matters, marketing, IT, business management, and portfolio controlling. The agreements have indefinite terms and can be terminated at any time at the end of a month. Since May 2009, the aforementioned services are essentially still provided only by Deutsche Wohnen AG, Deutsche Wohnen Management GmbH, and Deutsche Wohnen Vertrieb GmbH, and since August 2009 instead of the latter, Deutsche Wohnen Corporate Real Estate GmbH (formerly Deutsche Wohnen Corporate Immobilien GmbH). The agency agreements were adapted accordingly or discontinued.
Business Relationships with Current and Former Principal Shareholders of the Company and with Companies and Enterprises Over Which These Principal Shareholders Can Exert a Controlling Influence
Consulting agreement with the Oaktree Companies
A consulting agreement is in place between the Oaktree Companies and Deutsche Wohnen AG for consulting services at the request of our Group in projects involving the acquisition of equity interests in companies and of property portfolios. The agreement can be terminated at the end of a month subject to a notice period of one month. The remuneration depends on the services provided and is limited toS300,000 per year plus VAT and expenses.
Control agreement with DB Real Estate Management GmbH
In connection with the acquisition of its real estate portfolio in 1998/1999 and the public placement of the shares of Deutsche Wohnen AG, Deutsche Wohnen AG and DB Real Estate Management GmbH (formerly Deutsche Grundbesitz Management GmbH and now RREEF Management GmbH) had entered into a control agreement on May 7, 1999, based on which Deutsche Wohnen AG placed the management of its 141
company under the control of DB Real Estate Management GmbH. The sole shareholder of DB Real Estate Management GmbH was Deutsche Bank AG. Due to the control agreement, the business policy of Deutsche Wohnen AG was substantially determined by DB Real Estate Management GmbH. In the control agreement, DB Real Estate Management GmbH had also agreed to offset any net loss for the period arising during the contract term of 15 years, to the extent that offsetting cannot be done out of available reserves. The control agreement also provided that in consideration for the performance of its management function, DB Real Estate Management GmbH would receive a dividend-driven remuneration if and to the extent that the total amount of dividends by Deutsche Wohnen AG attributable to registered shares in a fiscal year exceeded a specific amount.
Under a termination agreement dated May 12, 2006, and with the approval of the Company’s extraordinary shareholders’ meeting on March 23, 2006, the control agreement was terminated on May 12, 2006 as part of the efforts to financially separate Deutsche Wohnen AG from the Deutsche Bank Group. The effective date of termination was June 30, 2006 (end of the partial fiscal year that was created by a resolution of the same extraordinary shareholders’ meeting).
Additional agreements with companies of the Deutsche Bank Group
In addition to the aforementioned control agreement, an agency agreement was in place between Deutsche Wohnen AG and DB Real Estate Investment GmbH (now RREEF Investment GmbH) under which DB Real Estate Investment GmbH provided IT services at prevailing market terms and conditions. As consideration, Deutsche Wohnen AG paid DB Real Estate Investment GmbHS1.1 million in 2006. This agreement was terminated March 28, 2007.