Founders' fund

(1) The articles of association must provide that a founders' fund is established, to cover the costs of setting up the association and to serve as a guarantee and working fund. The articles of association should contain the conditions under which the founders' fund is made available to the association, and should specify, in particular, how the founders' fund is to be redeemed, and whether and to what extent the persons who provided it are to be entitled to participate in the administration of the association.
(2) The founders' fund may be paid in only in legal tender, in cheques confirmed by the Deutsche Bundesbank, or by credit to an account held domestically with the Deutsche Bundesbank or a credit institution, for the free disposal of the association or the management board. Claims of the management board arising from these payments are deemed to be claims of the association. The articles of association may permit the delivery of the management board's own bills of exchange instead of payment.
(3) No right of termination may be granted to the persons who provided the founders' fund. The articles of association may guarantee them, in addition to interest payable out of annual income, a share in the surplus shown by the annual balance sheet; the supervisory authority decides what percentage of the amount paid in cash the interest and the total payments may not exceed. The founders' fund may be divided into shares, for which share certificates may be issued.
(4) The founders' fund may be redeemed only out of annual income and only to the extent that the loss reserve under section 193 has grown; redemption must begin as soon as the capitalised expenses for setting the business operation in motion have been fully written off.
(5) The articles of association may permit a further founders' fund to be established after the association is set up, for the purpose of ensuring the association's long-term risk-bearing capacity. Payments into the further founders' fund and its redemption require the approval of the supervisory authority. Subsection (4) does not apply.