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Notes to the separate financial statements of COMET Holding AG

General information

COMET Holding AG has its registered office in Flamatt, Switzerland and is the COMET Group's parent holding company listed on the Swiss stock exchange. The separate financial statements of COMET Holding AG at and for the year ended December 31, 2015 comply with the provisions of the Swiss Code of Obligations. The manner of the inclusion of COMET Holding AG in the consolidated accounts is governed by the measurement principles set out in the notes to the consolidated financial statements.

01 Accounting principles

These separate financial statements were for the first time prepared in accordance with the principles of the newly applicable Swiss Accounting Law (Title 32 of the Swiss Code of Obligations). The prior-year financial statements have been adjusted for comparability where necessary to reflect the new requirements. The adjustments relate to the classification of shareholders' equity in the balance sheet, and to the reporting of currency translation effects, which are now presented in financing expenses.

Receivables and loans

Receivables and loans are stated at nominal amounts less any necessary write-downs.

Intangible assets

Intangible assets – the rights to trademarks and names related to FeinFocus – are recognized at historical cost less necessary amortization and impairment.

Investments in subsidiaries

Investments in subsidiaries are recognized at historical cost less necessary impairment; they are individually tested annually for impairment.

02 Investments in subsidiaries

The following subsidiaries were consolidated in the Group financial statements of COMET Holding AG at December 31, 2015:

           
Company Registered office Currency Capital stock Equity interest in % *
        2015 2014
COMET Holding AG Flamatt, Switzerland CHF 7,738,010 100% 100%
COMET AG Flamatt, Switzerland CHF 2,000,000 100% 100%
COMET Electronics (Shanghai) Co. Ltd. Shanghai, China CNY 5,466,148 100% 100%
COMET Mechanical Equipment (Shanghai) Co. Ltd. Shanghai, China CNY 1,655,420 100% 100%
COMET Technologies USA, Inc. Shelton, CT, USA USD 1,000 100% 100%
COMET Technologies Korea Co. Ltd. Suwon, Korea KRW 500,000,000 100% 100%
YXLON International GmbH Hamburg, Germany EUR 110,000 100% 100%
YXLON International A / S Taastrup, Denmark DKK 601,000 100% 100%
YXLON International KK Yokohama, Japan JPY 10,000,000 100% 100%
YXLON (Beijing) X-Ray Equipment Trading Co. Ltd. Beijing, China CNY 1,077,000 100% 100%
PCT Engineered Systems LLC Davenport, IA, USA USD 2,882,273 100%

* COMET Holding AG also holds 100% of the voting rights in all companies.

03 Non-current financial assets – loans

Loans to subsidiaries were as follows:

     
In thousands of CHF 2015 2014
COMET Technologies USA, Inc. 31,221 26,002
COMET Technologies Korea Co. Ltd. 842 342
YXLON International GmbH 26,341 30,084
YXLON International A / S 3,045 3,368
Total loans to subsidiaries 61,448 59,797

04 Capital structure and shareholders

COMET Holding AG (the “Company”) is the Group's only company listed on a stock exchange. The Company's registered office is in Flamatt, Switzerland. The registered shares of COMET Holding AG have been listed in the main market segment of the SIX Swiss Exchange in Zurich since December 17, 2002.

   
Ticker symbol COTN
Security number 382 575
ISIN CH0003825756
Closing price at December 31, 2015 CHF 727.50
Market capitalization at December 31, 2015 CHF 562.9 million

Assorted data on the stock of COMET Holding AG is provided inside the cover flap at the front of the annual report.

Non-listed Group companies

COMET Holding AG has no publicly traded subsidiaries. The companies consolidated in the COMET Group are presented above in note 2, “Investments in subsidiaries”.

Registered shareholders

At December 31, 2015, COMET Holding AG had 1,627 voting shareholders of record (i.e., voting shareholders registered in the share register; prior year: 1,417). Of the total issued registered stock, 100% (prior year: 100%) represented free float. COMET Holding AG held no treasury stock at December 31, 2015 (prior year: none).

The structure of share ownership size classes among the shareholders of record at December 31, 2015 was as follows:

   
Number of shares Number of shareholders
1 to 100 1,307
101 to 1,000 266
1,001 to 5,000 34
5,001 to 10,000 9
More than 10,000 11

This analysis does not capture the stock of shareholders who were not registered in the share register; at December 31, 2015 these shares of unregistered owners amounted to 34% of the total (prior year: 35%).

Significant shareholders

Ownership interests in companies domiciled in Switzerland whose shares are listed at least partly in Switzerland must be notified both to the issuer company and to the SIX Swiss Exchange when the holder's voting rights reach, increase above or fall below certain thresholds. These notification thresholds are 3%, 5%, 10%, 15%, 20%, 25%, 33 1/3%, 50% and 66 2/3% of voting rights. The relevant details are set out in the Swiss Stock Exchange Act (BEHG) and in the Ordinance of the Swiss Financial Market Supervisory Authority on Stock Exchanges and Securities Trading (the FINMA Stock Exchange Ordinance).

At December 31, 2015 the Company, according to disclosure notifications, had the following significant shareholders (defined for this purpose as holding voting rights in excess of 3% of the COMET capital stock recorded in the Swiss commercial register of companies):

     
Beneficial owner Direct shareholder Share of voting rights as disclosed by shareholders
Garlito B.V., Amsterdam   5.09%
Artisan Partners Limited Partnership, Milwaukee, USA Eric R. Colson Charles J. Daley Gregory K. Ramirez 5.08%
Pictet Asset Management SA (Direction de Fonds) PICTET (CH) SWISS MID SMALL CAP 5.04%
Vanessa Frey Beat Frey Brigitte Frey Alexandra Frey KWE Beteiligungen AG 5.01%
BlackRock Inc. BlackRock Advisors (UK) Limited BlackRock Asset Management Canada Limited BlackRock Asset Management Schweiz AG BlackRock Fund Advisors BlackRock Fund Managers Limited BlackRock Institutional Trust Company, National Association BlackRock International Limited BlackRock Investment Management (UK) Limited BlackRock (Luxembourg) SA 4.98%
Credit Suisse Funds AG   3.21%
BlackRock Asset Management Schweiz AG BlackRock Global Funds - Swiss Small & MidCap Opportunities Fund, Zurich 3.04%

The Company has not been notified of and is not aware of any other shareholders that held more than 3% of its shares. To the best of the Company's knowledge, there were no voting pool agreements.

Reportable changes during fiscal year 2015

In the fiscal year under review, nine reportable announcements were published. For a complete list of all announcements under section 20 BEHG, refer to the publication platform of the disclosure section of the SIX Swiss Exchange: www.six-exchange-regulation.com/publications/significant-shareholders.html

Cross-shareholdings

There were no cross-shareholdings with other publicly traded companies.

05 Capital structure

Capital stock

The capital stock at January 1, 2015 was CHF 7,720,660, divided into 772,066 registered shares with a par value of CHF 10 per share. During fiscal year 2015 the capital stock was increased by 1,735 shares from the portion of authorized capital designated for equity compensation. Including the increase of 1,735 shares from this portion of authorized capital, COMET Holding AG at December 31, 2015 thus had CHF 7,738,010 of capital stock, divided into 773,801 registered shares with a par value of CHF 10 per share. The capital stock is fully paid in. At its meeting on August 13, 2015 the Board of Directors established that the capital increase from authorized capital for equity compensation was properly performed. The information on COMET Holding AG in the commercial register was updated to reflect the change in capital stock.

     
Registered stock, par value of CHF 10 per share Number of shares Par value in CHF
January 1, 2015 772,066 7,720,660
Increase in capital from the portion of authorized capital designated for equity compensation 1,735 17,350
December 31, 2015 773,801 7,738,010

At the balance sheet date, COMET Holding AG held no treasury stock (prior year: none).

Authorized capital for equity compensation

Under section 3a of its Bylaws, a portion of the Company's unissued authorized capital is designated for use only as equity compensation (in German this portion is known as “bedingtes Aktienkapital”). In such an increase, shares are issued to Executive Committee members and / or Board members of COMET Holding AG (i.e., of the COMET Group). With respect to this portion of authorized capital, the other shareholders' pre-emptive rights are excluded. The issuance of stock or stock subscription rights is based on a compensation plan (in the form of a written regulation) adopted by the Board of Directors. Grants of stock and of subscription rights may be made at less than the market price.

In April 2015, under profit-sharing compensation for 2014, the members of the Board of Directors and of the Executive Committee of COMET Holding AG were granted a total of 1,651 shares of stock in payment of CHF 837,057 of compensation due. In addition, the members of the Board of Directors were granted a total of 84 shares in payment of CHF 42,588 of retainers due for the period from January 1, 2015 to the 2015 Annual Shareholder Meeting. The shares were applied to the compensation due at a price of CHF 507 per share. As a result of these grants of a total of 1,735 shares during the year under review, the Company's unissued authorized capital for equity compensation showed the following movement:

     
Registered stock, par value of CHF 10 per share Number of shares Par value in CHF
January 1, 2015 24,246 242,460
Increase in capital in the fiscal year (award to Board of Directors and Executive Committee for retainers due and for prior year's profit-sharing compensation) (1,735) (17,350)
December 31, 2015 22,511 225,110

Authorized capital for other capital increases

The Company had no other unissued authorized capital (in German: “genehmigtes Aktienkapital”) at December 31, 2015, i.e., no unissued capital authorized for purposes other than equity compensation.

06 Disclosure of shareholdings of the Board of Directors and Executive Committee

The ownership interests in COMET Holding AG held by current members of the Board of Directors and of the Executive Committee are disclosed below. This disclosure covers all persons who held Board or Executive Committee positions for all or part of the year under review or of the prior year, regardless of whether they still did so at the balance sheet date. The shareholdings shown include those of respective related parties.

               
  Total number of shares Of which: shares subject to holding periods ending Share of voting rights
               
  2015 2014 4 / 17 / 2016 4 / 24 / 2017 4 / 22 / 2018 2015 2014
Hans Hess Chairman of the Board 4,766 4,532 492 199 234 0.6% 0.6%
Hans Leonz Notter Vice Chairman and member of the Board 3,785 5,906 280 130 159 0.5% 0.8%
Gian-Luca Bona Member of the Board 463 327 0 120 136 0.1% 0.0%
Lucas A. Grolimund Member of the Board 883 763 280 109 120 0.1% 0.1%
Rolf Huber Member of the Board 1,257 1,129 280 162 128 0.2% 0.1%
Ronald Fehlmann CEO 1,523 1,549 550 249 340 0.2% 0.2%
Markus Portmann CFO 960 838 246 91 122 0.1% 0.1%
Stefan Moll Segment President of X-Ray Systems 415 659 33 38 86 0.1% 0.1%
Michael Kammerer Segment President of Plasma Control Technologies 283 269 149 55 114 0.0% 0.0%
Charles Flükiger Segment President of X-Ray & ebeam Technologies 358 352 108 71 114 0.0% 0.0%
07 Eric Dubuis CIO 239 317 165 53 87 0.0% 0.0%
Christoph Bärtschi CHRO 95 0 0 0 95 0.0% 0.0%

Each 1,000 registered shares of COMET Holding AG, of a par value of CHF 10 per share, represented a total of 0.1292% of all voting power (prior year: 0.1295%). The members of the Board of Directors and Executive Committee held a total of 1.9% of voting rights (prior year: 2.2%). No material changes in ownership interests arose after the balance sheet date of December 31, 2015.

08 Options, conversion rights and treasury stock

COMET Holding AG has not issued any conversion rights or stock options.

In fiscal year 2015 and in the prior year, COMET Holding AG held no treasury stock.

09 Guarantees and pledged assets

As the Group is taxed as a single entity for purposes of value-added taxation, COMET Holding AG has joint and several liability for the value-added tax obligations of its Swiss subsidiary.

10 Number of full-time equivalents

The annual average number of full-time equivalents in 2015 and 2014 was less than 10.

11 Release of the separate financial statements for publication

The Board of Directors released these financial statements on March 3, 2016 for publication and will present them to shareholders for approval at the Annual Shareholder Meeting on April 21, 2016.