Securities prospectus - Pearl Gold AG

This risk could have an adverse effect on the Company’s business and competitive position,particularly on its net assets, financial position and results of operations.RISKS RELATING TO THE STRUCTURE OF PEARL GOLD AGPEARL GOLD AG’s ability to pay dividends depends largely on whether it receivesdividend distributions from its investment in Wassoul’Or.PEARL GOLD AG pays dividends under the condition that it has distributable reserves. SincePEARL GOLD AG is currently a holding company and receives income primarily in the form ofinvestment income from its interest in Wassoul’Or, it is largely dependent on whetherWassoul’Or pays dividends. All the major activities are carried out as part of the 25% investmentin Wassoul’Or S.A., which has its own management. The Company’s success depends largely onthe extent to which Wassoul’Or’s local management reaches the goals that have been set. In theevent that targets are missed to a significant degree, the Group’s performance could besignificantly below expectations. In addition, an inability to receive dividend distributions fromMali due to, for example, changes in exchange control regulations, could have an adverse effecton PEARL GOLD AG’s ability to pay dividends.As of the date of this Prospectus, the Company has no distributable reserves.The aforementioned factors could have an adverse effect on the Company’s net assets, financialposition and results of operations.PEARL GOLD AG’s interim results could be subject to significant fluctuationsThe vast majority of the Company’s anticipated revenues consists of investment income(dividends) from the investment in Wassoul’Or S.A. The dates of potential dividend distributionsdepend on factors that PEARL GOLD AG is unable to influence. As a result, there could besignificant fluctuations in the revenues and financial results from period to period with apotential corresponding effect on the share price. The quarterly and annual results published bythe Company only allow very limited conclusions to be drawn about future income.Thus, interim results could have a material effect on the Company’s net assets, financial positionand results of operations.There are risks associated with the acquisition of further interests in companies or licencesPEARL GOLD AG intends to acquire further interests in companies and licences for miningprojects in order to diversify its future earning potential. The success of PEARL GOLD AG’sbusiness model thus depends to a large extent on its ability to identify suitable companies orlicences, to purchase these at reasonable prices and to develop them using either internal orexternal advice.36