I. Purpose of the guideline
The participation of our employees in the success of the company is an integral part of our company philosophy. For this reason, we encourage our employees to buy Funkwerk shares within our planned staff share and equity option programmes. The trading of Funkwerk shares is subject to the German Securities Trading Act (WpHG) and supervision by the Federal Financial Supervisory Authority (BaFin). One key objective is ensuring that any current information about the company which could affect the share price is made accessible to all shareholders simultaneously. This guideline is intended to provide an overview of the legal provisions governing the prohibition of insider trading. In addition, regulations helping to avoid proscribed insider trading are laid down. This guideline forms part of the contract of employment.
II. Persons concerned
An insider is defined as any person who has access to insider information.
III. Insider information
Insider information is defined as any specific information about circumstances not made public which either exist already or which can be reasonably assumed to occur in the future. Furthermore, this information must relate to issuers of insider securities or to the insider securities themselves. Finally, this information must be accurate and have considerable potential to influence share price.
Insider information may thus take the form of facts, value judgments, estimations and, in some situations, even rumours, insofar as the circumstances concerned either exist already or will materialise in the near future.
For information to be considered insider information, the given circumstance must not be public knowledge. Public knowledge is knowledge to which anyone can gain access.
A considerable potential to influence the share price can be said to exist if the insider information gives investors with knowledge thereof a motive to buy or sell their shares.
Insider information, in concrete terms, may consist of the following: entry into or withdrawal from business segments, key structural measures, the acquisition or disposal of participations, takeover bids, capital measures, changes to the dividend rate, business performance, conclusion of major contracts, granting of significant patents, major instances of product liability, legal disputes of particular importance etc.
IV. Insider securities
Insider securities are financial instruments such as shares, share certificates, bonds, participation certificates and warrants. They may also be other securities similar to shares or bonds, if these can be traded on a market, or shares in investment capital issued by a capital investment company or a foreign investment company, as well as derivatives, or rights to subscribe to securities issues. These financial instruments must be admitted to listing on a domestic stock exchange, listed on the regulated or OTC market, or admitted to listing on an organised market of another stock exchange within the EU or EEA. An application for listing or publication of such an application also suffices for the financial instrument to be considered an insider security. Also included are financial instruments that are not permitted to list, but whose price is directly or indirectly dependent on the financial instruments listed in the previous paragraph. This also includes equity options from equity option programmes.
V. Insider transaction ban
Insiders are subject to three bans: 1. Ban on buying an selling
Insiders are banned from buying or selling insider securities on their own account or for a third party using insider information. 2. Ban on the unauthorised forwarding of insider information
Insiders are also banned from the unauthorised forwarding or making accessible of insider information to third parties. Forwarding of insider information is not permitted if it occurs outside the normal scope of exercise of the insider's work or profession, or outside the scope of completion of his/her tasks. 3. Ban on recommendation or inducement
Finally, the insider is banned from giving recommendations to buy or sell insider securities to a third party on the basis of insider information, and from inducing a third party to do so by other means. This means that an insider may not give a recommendation to buy or sell Funkwerk AG securities to any person, including family members, on the basis of insider information.
VI. Consequences of a breach of the insider trading ban
A breach of the insider trading ban entails penal consequences in the form of severe fines or imprisonment of up to five years. Furthermore, breach of the insider trading ban may lead to an official caution or even dismissal.
VII. Black-out periods
In order to avoid breaches of insider trading law, black-out periods are to be observed. These are periods in which members of the executive bodies and certain employees undertake neither to buy nor sell Funkwerk AG securities. The black-out period always begins 10 days before the end of a quarter and finishes one day after publication of the financial results in a press release. Further black-out periods for important events and circumstances may be defined and announced by the Board of Management and the Supervisory Board. For the exercise of equity options, the periods in the relevant equity option terms and conditions apply.
VIII. Speculative transactions
The members of the executive bodies and certain employees undertake to hold shares for at least three months after their purchase, and not to carry out extremely speculative transactions involving Funkwerk securities, such as trading puts and calls, short selling etc.
Board of Management and Supervisory Board of Funkwerk AG