6.8 As at March 31, 2017, 12 employees of the Disappearing Company also have an employment relationship with the Surviving Company. One such employee, who is on parental leave, has a dormant employment relationship with both the Surviving Company and the Disappearing Company. In the case of the other 11 employees, the Employment Relationships with the Disappearing Company have each been deactivated by individual agreements entered into with them, pursuant to which the respective employment relationship with the Disappearing Company will be reactivated if the Merger finally does not take place or if the relevant employee is faced with serious economic damages as a result of his or her having entered into the employment relationship with the Surviving Company before the existing Employment Relationship with the Disappearing Company transferring to the Surviving Company by virtue of the Merger. It is anticipated that these inactive employment relationships with the Disappearing Company will be terminated at the Legal Effective Time or thereafter by individual agreements to be entered into between the Surviving Company and the relevant employees because the purpose of such deactivated Employment Relationships will cease to exist at the Legal Effective Time.
6.9 Neither of the Merging Companies has established co-determination bodies, any (central, group or company) works council or any other employee representative body, nor is any such body or works council in the process of being established. Therefore, no agreements have been entered into by either of the Merging Companies with any such body or works council.
6.10 Neither of the Merging Companies (i) is a member of an employers' association, (ii) is directly bound by any collective bargaining or works agreement or (iii) applies any collective bargaining or works agreement for other reasons (e.g., through employment contracts referring to collective bargaining or works agreements).
6.11 The general meeting of shareholders of each of the Merging Companies has decided not to open negotiations on the establishment of rules concerning employee participation. Because neither of the Merging Companies is expected to be subject to employee participation arrangements upon the Merger becoming effective, as a matter of Dutch law, the Surviving Company does not need to implement employee participation arrangements as a consequence of the Merger.
6.12 Pursuant to both (i) the Directive 2005/56/EC of the European Parliament and of the Council of October 26, 2005 on cross-border mergers of limited liability companies and (ii) §§ 3 et seqq. of the German Act on the CoDetermination of Employees in CrossBorder Mergers ("MgVG") transposing such Directive into German law, the MgVG, as follows from the residence principle, is not applicable to the Surviving Company, which has its statutory seat in the Netherlands. From a European and German law perspective, any requirement to initiate employee participation procedures is solely subject to Dutch law.