AWD Holding

Line

• Manfred Behrens, CEO of Swiss Life Holding Germany
• Klaus G. Leyh, COO of Swiss Life Holding Germany
• Götz Wenker ( Sales Director, Swiss Life Select Germany GmbH)

The Swiss Life Germany Select GmbH, headquartered in Hanover is about the Swiss Life Germany Holding a 100 percent subsidiary of Swiss insurance company Swiss Life. Came out the company out of AWD Holding AG. AWD stand for General Economic Service. The AWD Holding was one of the largest financial services companies in Europe. The organized as multi-level marketing sales mediated through its sales representatives, who work on commission, mainly products from the fields of investments, retirement plans, financing and insurance for the target group of households. Due to new strategies and restructuring plans of the name DWS in 2013 was abandoned.

• 5.1 consultants and sales representatives
• 5.2 AWD injured
• 5.3 conversation strategy
• 5.4 GKM Litigation
• 5.5 Court judgment on the independence of the AWD

Indicators

The AWD Group, whose CEO Manfred Behrens led, had to cope with in 2009 a decrease in mediators by almost 10 % to approximately 5,300 independent financial advisors. The Group serves 1.97 million customers and operates except in Germany nor in England, Austria, Switzerland and Eastern Europe. Acquisitions were financed with capital from the IPO in the fall of 2000. Revenues increased in 2006 by over 15% to a record level of € 728 million. In fiscal year 2007 was achieved with a turnover of 717.5 million and EBIT of € 83 million, a record result.

For 2008, AWD has reported a decline in sales over the previous year by 11.8% to € 633 million and a decrease in operating income by 76.3 % to € 19.7 million. The number of consultants fell from 6,342 to 5,748.

History

AWD was founded in 1988. Contrary to popular opinion, that Carsten Maschmeyer had founded the company alone, with his future wife Bettina and her brother Kai Lange, the official founder in reality Kai Lange may have been alone or with his girlfriend Ulrike Schröter. Maschmeyer only a few months later, then rose to 900,000 DM in the company and took over the majority. He had previously been employed by the financial services company OVB Vermögensberatung.

In 1991, Maschmeyer AWD Children's Aid. The financing of the alleged by AWD annual financial volume of € 10 million is exclusively AWD employees who voluntarily pay 1% of their earnings. In the same year AWD expanded to Austria, the year after AWD Switzerland was founded.

1999, the Group took over the financial service provider S & C, in 2000 the Easter or financial service company for Economic and Financial advice ( GWF ).

In 2000, the IPO and the AWD took over in the wake further consulting company was. 2001 merged the Dr. a year earlier acquired Blumrath AG and also acquired Horbach Business Consulting GmbH Horbach GmbH, which should appeal to the AWD targeted the market of academics. In the same year AWD also took over the British distribution company Thomson's. The Hamburg-based company was taken over tecis 2002. It was followed by further acquisitions in the UK and Eastern Europe.

At the start of the Bundesliga season 2002/2003 the Financial Services acquired for € 2 million per season, the naming rights to the football field of the first division club Hannover 96: From the Niedersachsenstadion the AWD Arena and was from the Stadionsporthalle the AWD Hall. In Bremen, the Bremen City Hall was named after the reconstruction of 2004/2005 bis 2009 AWD -Dome.

Withdrawal Carsten Masch Meyers

In 2007, the Swiss insurance company Swiss Life shares the majority of the Maschmeyer family. On 13 March 2008, Swiss Life had successfully completed the offer to acquire all shares to the shareholders of AWD Holding AG and held at this time 86.2 % of AWD Shares. Meanwhile, Swiss Life has increased its stake in AWD to approximately 97%. In April 2008, drew AWD CEO Carsten Maschmeyer in the Board of Directors of Swiss Life. As part of the further expansion of AWD Maschmeyer was made from 1 September 2008 Manfred Behrens, currently CEO of Swiss Life Germany, as Co-CEO to the side and extended the AWD Management Board from three to eight members.

AWD founder and co-CEO Carsten Maschmeyer, who was with an interest of 8% the largest single shareholder of Swiss Life, was appointed on 31 March 2009 the Board of Directors of Swiss Life. In this context, he joined March 31, 2009 from his position as co- CEO of AWD back. Manfred Behrens, until then, together with Carsten Maschmeyer Co-CEO of AWD, was from 1 April 2009 the sole CEO of the company.

On December 7, 2011 Carsten Maschmeyer said with immediate effect his resignation from the Board of Directors of Swiss Life Holding AG, a day after the magazine Stern had / revealed in his Book No. 49 2011 ( Old invoices) that in against Carsten Maschmeyer and AWD Austria a criminal investigation of the prosecution was Vienna ( Aktz.13 St 2/11x ) set in motion, on suspicion of systematic fraud and founding a criminal organization. The criminal investigation was carried out at the request of the Association for Consumer Protection Information ( VKI ) Vienna, which opens out over five civil class actions on behalf of 2500 AWD - applicants and applicants with a value of 40 million euros. All the applicants have also joined the criminal complaint. After his resignation at Swiss Life Maschmeyer also reduced his equity stake of 5.05% in Swiss Life Holding AG to less than 3%.

Share

Since 10 November 2009, the shares of AWD Holding will no longer be listed on the stock exchange. Until that time, the share under the WKN 508 590 or ISIN DE0005085906 on German stock exchanges was performed.

Listing

The financial services company went on 20 October 2000 to the stock market. Just four months later, on 18 March 2001, the company was included in the MDAX. Both in terms of market capitalization ( rank 51 of the FTSE 100 companies ) as well as in trading volume ( rank 56 of the FTSE 100 companies ) was AWD represented on the front seats.

A total of 9.9 million new shares were issued at an issue price of 54 €. The journalist Bernd Niquet the stock had already recently judged to be overvalued, since the issue price would be in reasonable proportion to the profit expectation. The initial public offering of AWD Holding AG DM 974.8 million flowed into and cash equivalents net of IPO expenses ( 70.8 million DM). The share capital of AWD Holding AG is divided into 37,912,590 shares at the balance sheet date.

21% of AWD shares were at the time owned by the company's employees, and another 26 % held by private and institutional investors. The institutional investors were the United Kingdom (28 %) and Germany ( 24%) of the center of gravity. In addition, Italy (8% ), Switzerland ( 11%) and non-European investors ( 18%) were strongly represented. 53% of the shares were held by the Maschmeyer family.

2000, sales of the AWD Group rose despite the impact of the IPO by 26.2% to DM 670 million - equivalent to over the previous year, an increase of 138.9 million DM, even after deduction of IPO expenses of 70, DM 8 million remaining in the fiscal year pre-tax profit of 25.8 million DM

From about 60 € in early 2001, the listing of the AWD share has yielded to the end of 2002 to less than 10 €. By the end of 2003, the share again until mid-2005 rose to about 30 €, to just under € 40. Shortly before the founder Maschmeyer had sold 20 % of its shares. The Stern magazine and other media voiced in this regard the suspicion that he had already known at the time of the sale of the negative business in 2005. After a brief high, the price fell by fall 2007 back to about 25 €. For first time applicants have lost almost 60 % of the capital. The AWD 'share price since the IPO significantly underperformed the DAX, MDAX or Nasdaq.

On 8 January 2009, the company said in an Ad hoc announcement with that Swiss Life Beteiligungs GmbH in Hannover, a 100 percent subsidiary of Swiss Life Holding AG in Zurich, the cash compensation for the ousting of the remaining minority shareholders to 30 € has established per share.

On February 24, 2009, an extraordinary general meeting was held, at which the ousting of the minority shareholders was approved. On this day, the share capital consisted of 38,639,016 shares.

Delisting

Already on 14 March 2005 had AWD chief Maschmeyer is over the counter separated by 7.6 million shares, reducing its stake to 31%. This presentation focused loud Maschmeyer to a higher free float for the benefit of AWD. On 3 December 2007, the Swiss Life Holding AG and AWD Holding AG had published the conclusion of a strategic partnership; same time, the Swiss Life Holding AG announced plans to make an offer to € 30 per share to the shareholders of AWD AWD. The life insurance company had taken over as part of its tender offer to all shareholders, already 20 % of the Maschmeyer family.

The end of 2008 the Maschmeyer family transferred the share of 10.46 % in Swiss Life, which thus held 96.7 %. The offset Swiss Life in the position to move the owners of the remaining shares by compulsory redundancy for sale and to take AWD then out of the stock exchange trading.

On 24 February 2009, the Commercial Register of the Local Court of Hanover had the decision of the Extraordinary General Meeting on the transfer of shares from minority shareholders to Swiss Life Beteiligungs GmbH ( majority shareholder ) to an appropriate cash compensation in the amount of 30 € per no par value bearer shares with a pro rata amount of the share capital entered in the amount of 1 € in the commercial register of the Company.

Upon registration of the transfer resolution in the commercial register all shares of the minority shareholders of AWD Holding AG are by law transferred to the Swiss Life Beteiligungs GmbH. The listing of the shares of AWD Holding AG was terminated on 10 November 2009.

Criticism

Consultants and sales representatives

During the orientation period to receive commercial agents - if they voluntarily choose to - according to the AWD average € 1,500 so-called "Monthly Payment", which are de jure advance commission. Not earned by the consultant this advance commission, it must have this refund. In order to avoid excessively high recovery totals by AWD, the company introduced an internal directive, according to an advance commission is to be paid linearly according to sales planning. Keep the agents do not include the minimum criteria, they are purely paid by contingency basis. The compensation varies depending on the quality and level of experience of the agent.

The developed through the direct sales structure business practices of AWD were and are controversial and have been criticized by consumer protection organizations today.

Former AWD employees signposted from December 2002 to May 2003 on the internet on different websites their personal and painful experiences with the group. The AWD then tried to have awd - aussteiger.de and aussteigerforum.de close to judicial means the domains. Both sides now no longer exist. Currently, the association of former AWD employee is active.

In recent years, several court rulings have been obtained with large claims against AWD advisors and the AWD itself. In response, the Group has implemented a training of self- insurance and investment consultants with specialist content and audio and video training that will be completed in Germany with a CCI exam to technical consultant for financial services in Austria with an examination at the WKO for State Financial Advisor can and must be completed within two years AWD affiliation. Due to the EU Insurance Mediation Directive approved training in this kind of duty, and should be removed finally by the IHK examination committee. However, the AWD has here sought, that only one in ten of such a professional training required in the company ( AWD special ).

After matching reports a large number of former employees of the financial situation of most AWD advisors is very bad. The reason for this is that the consolidated agency fees and expenses related to the use of the AWD infrastructure into account. These fees are also to be paid, if the consultant has little or no success. Furthermore it is often reported by unfavorable commission calculations at the expense of independent sales representatives. According to the critique, the fluctuation in the individual offices is often extremely high, and that got into an economic dependency representatives are indebted in part and were under enormous pressure to sell. In 2003, a four-digit number of former employees AWD saw, for example, over the part of the five-digit commission recoveries.

AWD injured

A total of 6500 AWD injured have registered to March 2009 at the Austrian Association for Consumer Information ( VKI ) for the proposed class action because of the mediation of the crashed during the course IMMOFInanz and IMMOEaST shares. Cause of action is the allegation that AWD advisors have touted as trustee safe investment since the late 1990s Realty financial shares. In many cases the entire available capacity of a customer to have been invested in IMMOFINANZ shares or other property stocks. In many cases, the shares are revealed as " real estate fund " dubs and have deliberately avoided the word "shares". In addition, by " capital guarantees " the speech was and was not mentioned the possibility of a total loss. According VKI the accumulation of objections example indicates systemic deficits in guidance organization of AWD. The risk of litigation costs borne by the German litigation funders, Foris, which the injured party may participate without cost risk to the class action itself. For this is to dissipate a success rate of Foris in case of success, which is dependent on how quickly a solution can be achieved.

In March 2011, the Stiftung Warentest reported that the number of dissatisfied customers do not move AWD at ppm level, as Carsten Maschmeyer, the longtime chairman of the holding company, claims. Rather, the Stiftung Warentest was dealing with an AWD list, according to which " more than 34,000 AWD Customers" with closed-end property fund of the Capital Konsult from Stuttgart lost money.

Interview strategy

The AWD consultation process is usually as follows:

• The first meeting will take place as possible in the premises of potential customers. There, a standardized presentation of AWD is played and collected the insurance and financial situation of the customer.

• The second call follows usually after a few days to a few weeks. In this case, the potential client from AWD advisors " Personal Financial Report" ( PFG) is an approximately 50 -page so-called " private financial strategy " now presented. This based on a software created by the gfp Society for private financial planning shows existing supply gaps, summarizes investment opportunities together and presents concrete products.

• In the second or third appointment it comes to the possible signing of the contract. To this end, the consultant pre-populated forms usually have it already. The customer will be handed over to the legally required documents, any queries written following AWD statements on legal rights as cancellation options. This was omitted in the past, according to many court judgments in part. Since the introduction of the SG - Directive, the logging of the counseling session is mandatory. This duty comes AWD in their own words since 2001 through the introduction of call notes after. The protocols take from AWD - view together all relevant discussion topics, and discuss opportunities and risks.

GKM Litigation

The purchase of GKM Society of Professional Capital Management AG of its 100 percent parent company RL Holding GmbH by the AWD ignited a dispute. After presentation by Reinhard Listl, CEO of GKM and CEO of RL Holding, with the resultant purchase agreement on 10 September 2008, subject to the approval of the Supervisory Board of the AWD Group. On September 11, Maschmeyer has therefore paid the agreed purchase price in a larger double-digit million amount. Since the AWD Supervisory Board had not approved the deal, is now debatable whether Maschmeyer had thus bought the GKM how Listl it represents, or the purchase is void and voiding so by rejecting the AWD Supervisory Board. Following the judgment of the District Court of Regensburg on 31 May 2009, the sale was rescinded and Reinhard Listl has now repaid the purchase price of € 40 million to Carsten Maschmeyer. Carsten Maschmeyer renounced interest of approximately € 2 million. The court costs in the amount of € 1.5 million remained even with Reinhard Listl. Due to the potential sale of the GKM left more than 300 sales representatives GKM.

Court judgment on the independence of the AWD

By a judgment of the District Court of Hanover on 30 June 2009 AWD was forbidden to advertise with the word "independent " in his claim " your independent financial adviser ." The court justified the judgment so that from an economic perspective, Swiss Life could be a dominant firm to take an effect on the AWD. Moreover manage with Manfred Behrens now the former CEO of Swiss Life Germany the company. AWD announced to appeal against the verdict. AWD has now changed its slogan to " Your personal financial adviser ".

Name change in 2013

The Swiss Life has recognized that she has miscalculated when buying the AWD in 2007 in the business prospects. On 28 November 2012, communicates that the intangible asset of 1.34 billion to 765 million SFr. has been corrected. Simultaneously, a new strategy was presented, which provided, among other things, to replace the name by AWD, Swiss Life Select. This was implemented in early April 2013.