Südzucker International Finance B. V. Südzucker AG ... - Xetra

(2) it has only communicated or caused to be communicated and will only communicate or causeto be communicated any invitation or inducement to engage in investment activity (within themeaning of section 21 of the Financial Services and Markets Act 2000, the “FSMA”) received byit in connection with the issue or sale of any Bonds in circumstances in which section 21 (1) ofthe FSMA does not apply to the Issuer or the Guarantor; and(3) it has complied with and will comply with all applicable provisions of the FSMA with respect toanything done by it in relation to the Bonds in, from or otherwise involving the UnitedKingdom.Delivery of the Bonds and the Shares after ConversionThe Bonds will be represented by a global bond certificate to be deposited with Clearstream BankingAG, Frankfurt am Main, on or about December 8, 2003. No definitive bond certificates will be issuedand the right of delivery of definitive bonds is excluded. The Issuer has entered into a book-entryregistration agreement with Clearstream Banking AG. The Bonds will be transferable in the form ofco-ownership interests pursuant to the rules of Clearstream Banking AG. A copy of the global bondcertificate is available free of charge from the paying agent.The Shares to be delivered upon conversion of the Bonds are no par value bearer shares ofSüdzucker AG Mannheim/Ochsenfurt representing (at the date of this Listing Prospectus) each animputed share of 5 1.00 in the share capital of Südzucker AG Mannheim/Ochsenfurt. The right ofshareholders to receive individual share certificates has been excluded in the articles of associationof Südzucker AG Mannheim/Ochsenfurt. Each Share grants one voting right in the generalshareholders’ meeting. New Shares issued upon the exercise of the conversion rights will be entitledto dividends for the entire fiscal year in which they are issued and for all future periods.RatingThe Bonds have been rated A2 by Moody’s Investor Service and A– by Standard & Poor’s. The tablesbelow list the various rating categories and symbols for Moody’s Investor Service and Standard &Poor’s.Moody’s Investors ServicesCategories and symbolsAaaAaABaaExceptionalExcellentGoodAdequateBaQuestionableBPoorCaaVery poorCaExtremely poorCLowest1,2,3 (1 high, 3 low) Within-category modifiers9>=>;9>=>;SECURE (Investment Grade)VULNERABLE (Non-Investment Grade)7

The following table shows key financial data of Südzucker Group’s Specialties segment:First Halfof2003/04First Halfof2002/03 2002/03 2001/02Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 million 584 509 1,025 922Operating profit . . . . . . . . . . . . . . . . . . 5 million 65 53 123 93Operating margin . . . . . . . . . . . . . . . . . % 11.1 10.3 12.0 10.0Capital expenditures . . . . . . . . . . . . . . 5 million 39 33 72 76Investments in financial assets . . . . . 5 million 27 14 14 6110

Summary of the Conditions of the BondsThe following summary is qualified in its entirety by the more detailed information appearing in the“Terms and Conditions” (the “Conditions”), and certain terms used herein are defined in theConditions.Denomination of the BondsIssue PriceMaturity DateStatus and Negative PledgeInterestGuaranteeConversion Right andConversion PriceConditions for Exercise ofConversion RightThe issue in an aggregate nominal amount of 5 250,000,000 isdivided into 250,000 bearer Bonds in the principal amount of5 1,000 each, which rank pari passu among themselves.100% of the Principal Amount of the Bonds.The Issuer shall redeem the Bonds at their Principal Amounttogether with interest accrued thereon on December 8, 2008 tothe extent that they have not previously been redeemed,converted, or repurchased and cancelled.The Bonds will constitute unsecured and unsubordinatedobligations of the Issuer ranking pari passu among themselvesand at least pari passu with all other unsecured andunsubordinated obligations of the Issuer. So long as any Bond isoutstanding, the Issuer and the Guarantor undertake not toprovide any security, by encumbering any of its own assets, forother bonds, notes, debentures or similar debt instruments orcertificates of indebtedness (“Schuldscheindarlehen”) or forguarantees or indemnities in respect thereof without at the sametime having the Bondholders share equally and rateably in suchsecurity or such other security as shall be approved by anindependent accounting firm of internationally recognizedstanding as being equivalent security.The Bonds shall bear interest at the rate of 3.00% per annum ontheir principal amount from December 8, 2003. Interest shall bepayable semi-annually in arrears on December 8 and June 8 ofeach year, commencing on June 8, 2004.The Guarantor has unconditionally and irrevocably guaranteedthe due and punctual payment of any and all sums expressed tobe payable under the Conditions by the Issuer. See § 12 of theConditions.Each Bondholder will have the right to convert each Bond intoShares on any Business Day during the Conversion Period bydelivering to a Conversion Agent a duly executed ConversionNotice. See §§ 6 and 7 of the Conditions. The price at whichShares shall be delivered to Bondholders upon conversion shallbe 5 20.53 per Share, subject to the conditions set forth in § 6(5) ofthe Conditions and adjustments as provided in §§ 10 and 16(4) ofthe Conditions.A Bondholder may convert its Bonds into Shares only: (a) if at anytime after the Issue Date, the Xetra-Quotation on at least 20Trading Days in a period of 30 consecutive Trading Days endingon the last Trading Day of any calendar quarter exceeds 100% ofthe Conversion Price applicable on the last Trading Day of suchcalendar quarter; or (b) if the Xetra-Quotation on any Trading Dayon or after September 8, 2008 exceeds 100% of the thenapplicable Conversion Price; or (c) during the five Business Dayperiod after any five consecutive Trading Day period in which the11

trading price per Bond (which is the average of the midpoints ofthe bid/ask quotes quoted on Bloomberg on page DBCB at thetime of the Xetra-Quotation) for each Trading Day of that periodwas less than 97.5 % of the product of the Xetra-Quotation on suchTrading Day and the then applicable Conversion Ratio; or (d) if theBonds have been called for early redemption by the Issuer; or (e)upon certain significant mergers or other reorganizations; or (f) ifa Change of Control and the Effective Date have been publishedpursuant to § 16(1) of the Conditions; or (g) if an offer is made toall shareholders of the Guarantor of rights entitling them topurchase Shares at less than 70% of the non-weighted arithmeticaverage of the Xetra-Quotations in a certain period of time. See§ 6(5) of the Conditions.UndertakingConversion PeriodEarly Redemption at theOption of the Issuer forReasons of Share PriceEarly Redemption at theOption of the Issuer forReasons of MinimalOutstanding PrincipalAmountEarly Redemption at theOption of the Bondholder forReasons of a Change ofControlTaxesThe Guarantor has undertaken to grant each Bondholder the rightto convert the Bonds into Shares in accordance with theConditions. See § 6 of the Conditions.Subject to the excluded periods, the Conversion Period shall bethe period commencing on January 18, 2004 until November 21,2008 (both dates inclusive), or, in the event of early redemption bythe Issuer pursuant to § 3(3) or (4) of the Conditions, until the endof the tenth Business Day prior to the day fixed for such earlyredemption.On or after December 9, 2006, upon giving not less than 20 andnot more than 40 days’ notice by publication in accordance with§ 18 of the Conditions, the Issuer may redeem the Bondsoutstanding in whole, but not in part, at their Principal Amount,together with interest accrued thereon, if the non-weightedarithmetic average of the stock exchange prices of the ordinaryshares of the Guarantor in the final auction (Schlussauktion) in theXetra-System of Deutsche Börse AG (or a successor system) on atleast 20 of the 30 trading days immediately preceding thepublication of the redemption notice exceeds 130% of the thenapplicable Conversion Price.By giving not less than 20 and not more than 40 days’ notice bypublication in accordance with § 18 of the Conditions, the Issuermay redeem the remaining Bonds in whole, but not in part, attheir Principal Amount, together with interest accrued thereon, ifat any time the aggregate Principal Amount of Bonds outstandingfalls below 10% of the aggregate principal amount of the Bondsthat were initially issued.If the Issuer or the Guarantor gives notice that a Change ofControl has occurred, each Bondholder may, after giving not lessthan 20 days’ notice to the Paying Agent prior to the EffectiveDate, require the Issuer to redeem on the Effective Date any or allof its Bonds at their Principal Amount, together with interestaccrued thereon. See § 16 of the Conditions.All payments by the Issuer on the Bonds and by the Guarantor inrespect of the Guarantee will be made without deduction orwithholding of any present or future taxes, duties orgovernmental charges of any nature whatsoever imposed, leviedor collected by way of deduction or withholding at source by, in oron behalf of The Netherlands or the Federal Republic of Germany,or by or on behalf of any political subdivision or authority thereof12

or therein having power to tax, unless such deduction orwithholding is required by law. The Conditions do not obligatethe Issuer or the Guarantor to pay any additional amountsresulting from the introduction of taxes or duties required by lawto be deducted or withheld from amounts payable as aforesaid.Loan AgreementSecurity AssignmentForm of the BondsThe Issuer, pursuant to a loan agreement between the Issuer aslender and the Guarantor as borrower, has disbursed theproceeds from the sale of the Bonds in an amount of5 250,000,000 by way of a loan to the Guarantor. The due dates forpayments under the loan correspond to the due dates forpayments under the Bonds; in the event of an early redemption ofthe Bonds, the loan is likewise subject to early repayment. See§ 11(1) of the Conditions.The Issuer has assigned the claims against the Guarantor forpayment of principal under the Loan Agreement in an amountequal to the aggregate Appertaining Claims to Deutsche BankAktiengesellschaft, acting on account of the Bondholders, forpurposes of securing the claims for payment of principal of theBonds. Upon such assignment, a partial amount of the Loan equalto the Appertaining Claim will be attributable to each Bond. Inrespect of each Bond, such transfer for security purposes will besubject to the condition subsequent (auflösende Bedingung)ofthe redemption of the Bonds with Appertaining Claims withoutexercise of the Conversion Right. The Appertaining Claim relatedto each Bond is non-detachable from the relevant Bond. Anytransfer of a Bond results in the transfer of the Appertaining Claimwithout any explicit declaration of transfer being required. In theevent of the exercise of the Conversion Right by delivering Bonds,the Appertaining Claim shall pass to the Guarantor and expiretherewith. See § 11(2) of the Conditions.The Bonds are represented by a Global Bond Certificate which hasbeen deposited with Clearstream Banking AG. Definitivecertificates representing individual Bonds and interest couponsshall not be issued.The Global Bond Certificate will be kept in custody by ClearstreamBanking AG until all obligations of the Issuer under the Bondshave been discharged. The Issuer has entered into a book-entryregistration agreement with Clearstream Banking AG.Paying and Conversion AgentsSubstitution of the IssuerNoticesThe Issuer has appointed Deutsche Bank AG, Corporate Trust andAgent Services, Frankfurt, as Paying Agent and Deutsche BankAG, Corporate Actions/Warrants, Frankfurt, as Conversion Agent.The Issuer and the Guarantor may at any time vary or terminatethe appointment of any Paying Agent and/or Conversion Agent.The Issuer shall without the consent of the Bondholders beentitled at any time to substitute for the Issuer the Guarantor orany other company, at least 90% of the voting shares or otherequity interests of which are directly or indirectly owned by theGuarantor, as principal debtor in respect of all obligations arisingfrom or in connection with the Bonds. See § 15 of the Conditions.All notices regarding the Bonds shall be published in a mandatorysupra-regional newspaper designated by the Frankfurt StockExchange as long as the Bonds are listed on the Frankfurt Stock13

Exchange and the rules so require. It is expected that such noticeswill normally be published in the Börsen-Zeitung. Any notice willbecome effective for all purposes on the date of publication (or, ifpublished more than once, on the day of the first suchpublication).LanguageGoverning Law andJurisdictionListingThe Conditions are written in German and provided with anEnglish language translation. The German version shall be theonly legally binding version. The English translation is forconvenience only.The Bonds shall be governed by and shall be construed inaccordance with the laws of the Federal Republic of Germany. Thecompetent courts of Frankfurt am Main (Amtsgericht orLandgericht) shall have non-exclusive jurisdiction for allproceedings arising out of or in connection with the Bonds.The Bonds have been admitted to the official market of theFrankfurt Stock Exchange.14

Südzucker International Finance B. V.– Issuer –Incorporation, Corporate Seat and Executive OfficesSüdzucker International Finance B. V., a wholly owned subsidiary of the Guarantor, was incorporatedon January 13, 1994 as a private limited liability company (besloten vennootschap met beperkteaansprakelijkheid) under the laws of the Netherlands for an indefinite period of time. The Issuer hasits statutory seat in Amsterdam, The Netherlands, where it is registered with the Commercial Registerof the Chamber of Commerce and Industries for Amsterdam under no. 33.255.988. Its executiveoffices are located at L. J. Costerstraat 12, NL-3261 LH Oud-Beijerland.ObjectsThe objects of Südzucker International Finance B. V. are the financing of, participation in, cooperationwith, and management of other companies and enterprises; the purchase and sale of properties; theprovision of loans to third parties as well as to group companies or the granting of securities andguarantees for the benefit of third parties or group companies; the establishment of branches andsubsidiaries domestically and abroad; other financing activities, and all other activities relating to orfor the promotion of the above objects in the widest sense of the word.Share CapitalThe authorized share capital of Südzucker International Finance B. V. as of August 31, 2003 amountedto 5 2,268,901.08 denominated in accordance with article 2:178 c of the Netherlands Civil Code,divided into 50,000 ordinary shares of 5 45.38 each denominated in accordance with article 2:178 c ofthe Netherlands Civil Code. As of August 31, 2003 the paid-in capital was 5 453,780.22 denominatedin accordance with article 2:178 c of the Netherlands Civil Code.All Shares are owned by Südzucker AG Mannheim/Ochsenfurt.Capitalization (unaudited)The following table shows the capitalization of Südzucker International Finance B. V. as at August 31,2003, and as adjusted to reflect the issuance of the Bonds (5):ActualAugust 31,2003As adjustedAugust 31,2003Subscribed Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 453,780 453,780Revenue Reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 823,445 823,445Unappropriated Profits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 370,973 370,973Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,648,198 1,648,198Long Term Financial Debts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 800,000,000 1,050,000,000Total Capitalization (Less Current Liabilities) . . . . . . . . . . . . . . . . . . . 801,648,198 1,051,648,198There has been no material change in the capitalization and the contingent liabilities of the Issuersince August 31, 2003 with the exception of the Bonds to which this Listing Prospectus pertains.15

ManagementThe current members of the management board of Südzucker International Finance B. V. are:Herman Hein Scholten,Gerardus Pancratius Nota,both having their business address at: L. J. Costerstraat 12, NL-3261 LH Oud-Beijerland,andDeutsche International Trust Company N. V.,having its business address at: Postbus 268, 1000 AG Amsterdam.Annual MeetingThe ordinary annual general meeting shall be held within six months following the end of eachfinancial year.Independent AuditorsKPMG Accountants N. V., Churchillplein 6, NL-2517 JW Den Haag, have been the independentauditors of Südzucker International Finance B. V. They have audited the financial statements for thefinancial years ended February 2001, 2002 and 2003 and have given an unqualified opinion in eachcase.The annual General Meeting of Shareholders of Südzucker International Finance B. V., held on July 30,2003, has elected PricewaterhouseCoopers N.V., Rotterdam, as auditor for the financial year 2003/04.Financial YearThe financial year of Südzucker International Finance B. V. begins on March 1 and ends on the last dayof February of the following year.LitigationSüdzucker International Finance B. V. is not or has not during the last two financial years beenengaged in any litigation or arbitration proceedings which may have or have had during such perioda significant effect on the financial position of Südzucker International Finance B. V., nor, as far asSüdzucker International Finance B. V. is aware, are any such litigation or arbitration proceedingspending or threatened.16

Südzucker Aktiengesellschaft Mannheim/Ochsenfurt– Guarantor –Incorporation, Corporate Seat and Head OfficeSüdzucker AG Mannheim/Ochsenfurt was incorporated under the laws of Germany in 1926, and isregistered with the Commercial Register at the Amtsgericht Mannheim under HRB No. 0042.Südzucker AG Mannheim/Ochsenfurt’s corporate seat is Mannheim, Germany, and its head office islocated at Maximilianstrasse 10, D-68165 Mannheim.The duration of Südzucker AG Mannheim/Ochsenfurt is indefinite. Südzucker AG Mannheim/Ochsenfurt is the parent company of the Südzucker Group and carries out the management andcorporate functions of the group.ObjectsThe objects of Südzucker AG Mannheim/Ochsenfurt are the production and sale of sugar, theexploitation of by-products resulting therefrom and farming and agriculture. The company may, inany form permissible, acquire other businesses or any part thereof or interest therein and effect anytransaction which may seem likely to fulfill or further, directly or indirectly, the objects of thecompany.Share CapitalThe share capital of Südzucker AG Mannheim/Ochsenfurt amounts to 5 174,787,946 divided into174,787,946 non-par value bearer shares with an imputed share in the share capital of 5 1.00 each.The issued share capital has been fully paid in.On August 24, 2000 the management board, upon approval of the supervisory board, adopted aresolution to increase the issued share capital from then 5 136,198,400 by 5 6,809,920 to 5 143,008,320by way of issuing 5,327,660 new ordinary bearer shares and 1,482,260 preferred shares, effectiveupon registration with the commercial register on August 29, 2000. On August 23, 2001 themanagement board upon approval of the supervisory board adopted a resolution to further increasethe share capital by 5 31,779,626 to 5 174,787,946 by way of issuing 31,779,626 new ordinary bearershares, effective upon registration with the commercial register on August 24, 2001. At the same date,the shareholders adopted a resolution to convert the preferred shares into ordinary shares, effectiveupon registration with the commercial register on September 17, 2001.Capitalization (unaudited):The following table sets forth the unaudited consolidated capitalization of the Südzucker Group as ofAugust 31, 2003 and as adjusted to reflect the issue of the Bonds (in 5 million):Actual As adjustedSubscribed Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 175 175Capital Reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 938 951Revenue Reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 739 739Minority Interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 383 383Equity (incl. Minority Interests) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,235 2,248Long Term Financial Debts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 867 1,098Total Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,102 3,34617

There has been no material change in the capitalization and the contingent liabilities of the SüdzuckerGroup since August 31, 2003 with the exception of the Bonds to which this Listing Prospectuspertains.Management and EmployeesSupervisory BoardCurrent members of the supervisory board are as follows:Dr. Hans-Jörg GebhardChairmanFranz-Josef Möllenberg (*)Deputy ChairmanDr. Christian KonradDeputy ChairmanHeinz Christian BärGerlinde Baumgartner (*)Dr. Ulrich BrixnerHelmut Drescher (*)Ludwig EidmannManfred Fischer (*)Chairman of the Verband Süddeutscher Zuckerrübenanbauer e. V.(association of south German sugar beet growers)EppingenChairman of the Food and Catering UnionRellingenChairman of the supervisory board of AGRANA Beteiligungs-AG,ViennaVienna, AustriaVice-president of the Deutscher Bauernverband e. V. (associationof German farmers)Karben – Burg-GräfenrodeMember of the works council of the Plattling factory,Südzucker AGOsterhofenChairman of the Board of DZ BANK AG Deutsche Zentral-Genossenschaftsbank, Frankfurt am MainDreieichChairman of the works council, Südzucker AGWattenheimChairman of the Verband der Hessen-NassauischenZuckerrübenanbauer e. V. (association of sugar beet growers ofHesse-Nassau)Groß-UmstadtDeputy chairman of the works council, Südzucker AGFeldheimPaul Freitag Chairman of the Verband Fränkischer Zuckerrübenbauer e. V.(association of sugar beet growers of Franconia)Oberickelsheim-RodheimErwin HamesederHans Hartl (*)Klaus Kohler (*)Managing Director of Raiffeisen-Holding Niederösterreich-Wienreg. Gen. m. b.H.Vienna, AustriaState area chairman of the Food and Catering UnionErgoldingChairman of the works council of the Offenau factory,Südzucker AGBad Friedrichshall18

Jörg Lindner (*)Ulrich MüllerErich Muhlack (*)Divisional officer, Food and Catering UnionHamburgChairman of the Verband Sächsisch-Thüringischer Zuckerrübenanbauere.V. (association of sugar beet growers of Saxony-Thuringia)IllsitzManager of the Plattling, Rain and Regensburg factories,Südzucker AGRegensburgRichard Schwaiger Chairman of the Verband bayerischer Zuckerrübenanbauer e. V.(association of sugar beet growers of Bavaria)AiterhofenKlaus Viehöfer (*)Ernst WechslerRoland Werner (*)Member of the works council of the Zeitz factory, Südzucker AGGranaChairman of the Verband der Hessisch-PfälzischenZuckerrübenanbauer e. V. (association of sugar beet growers ofHesse-Palatinate)WesthofenChairman of the works council of the Brottewitz factory,Südzucker AGSaxdorf(*) Employee representativeManagement BoardThe current members of the management board are:Dr. Theo SpettmannSpokesmanSpokesman of the management board since February 2, 1995 and responsible for sugar sales,strategic corporate planning/group development/investments, public relations, organization/IT, foodlaw/consumer policy/quality control, personnel and social matters, and marketing. His current termexpires on September 22, 2008.Memberships of domestic, statutory supervisory boards:Berentzen-Gruppe AG, Haselünne (chairman)Fresenius Medical Care AG, Hof/SaaleGerling Industrie Service AG, CologneKarlsruher Versicherung AG, KarlsruheGroup company board memberships:AIH Agrar-Industrie-Holding GmbH, Mannheim (chairman)Freiberger Lebensmittel GmbH & Co. Produktions- und Vertriebs KG, BerlinRaffinerie Tirlemontoise S. A., Brussels, BelgiumSaint Louis Sucre S. A., Paris, France (chairman)Südzucker Verkauf GmbH, OberurselSüdzucker International GmbH, OchsenfurtSüdzuckergroup Export Centre S. A., Brussels, Belgium (chairman)19

Albert DardenneAdministrateur dØlØguØ of Raffinerie Tirlemontoise, and responsible for Surafti, Portion Pack andORAFTI. His current term expires on January 31, 2006.Group company board memberships:AGRANA Internationale Verwaltungs- und Asset-Management AG, Vienna, AustriaCandico N.V., Antwerp, BelgiumEnsemble Participations S. A. S., Paris, FranceFinanci›re Franklin Roosevelt S. A. S., Paris, FrancePortion Pack Europe Holding B. V., Oud-Beijerland, The NetherlandsRaffinerie Notre-Dame S. A., Oreye, BelgiumRemy Industries N.V., Wijgmaal-Leuven, BelgiumSaint Louis Sucre S. A., Paris, FranceDr. Christoph KirschResponsible for finance, accounting, financial management/controlling, operational corporate policy,taxation, legal matters, property/insurance and procurement of supplies and consumables. Hiscurrent term expires on July 12, 2004.Group company board memberships:AGRANA Beteiligungs-AG, Vienna, AustriaBETA Beteiligungs GmbH, Mannheim (chairman)Financi›re Franklin Roosevelt S. A. S., Paris, FranceFreiberger Lebensmittel GmbH & Co. Produktions- und Vertriebs KG, BerlinRaffinerie Tirlemontoise S. A., Brussels, Belgium (chairman)Südzucker International GmbH, OchsenfurtSüdzucker Verkauf GmbH, Oberursel (chairman)Südzucker Versicherungs-Vermittlungs-GmbH, Mannheim (chairman)Zuckerfabrik Ropczyce, Ropczyce, PolandProf.Dr. Markwart KunzResponsible for production/technical, research/development/services, procurement of capital goods/maintenance materials and services, and Palatinit. His current term expires on August 31, 2008.Group company board memberships:AGRANA Internationale Verwaltungs- und Asset-Management AG, Vienna, AustriaAGRANA Zucker und Stärke AG, Vienna, AustriaPalatinit Asia Pacific Pte Ltd., SingapurSaint Louis Sucre S. A., Paris, FranceZuckerfabrik Ropczyce, Ropczyce, PolandRaffinerie Tirlemontoise S. A., Brussels, BelgiumJohann MarihartChairman of the executive board of AGRANA Beteiligungs-AG and responsible for raw materialcrops/starch and South-eastern Europe. His current term expires on January 31, 2004.20

Memberships of comparable domestic and foreign supervisory bodies:AGRANA Zucker und Stärke AG, Vienna, Austria (chairman)BBG Bundesbeschaffungsges.m. b. H., Vienna, AustriaLeipnik-Lundenburger Invest Beteiligungs AG, Vienna, AustriaÖsterreichische Nationalbank, Vienna, AustriaOttakringer Brauerei AG, Vienna, AustriaUniversität für Bodenkultur, Vienna, AustriaTÜV Österreich, Vienna, Austria (president)Group company board memberships:AGRANA Internationale Verwaltungs- und Asset-Management AG, Vienna, Austria (chairman)EHCF Kft., Acs, Hungary (chairman)Magyar Cukor Rt., Budapest, Hungary (chairman)MoravskoslezskØ Cukrovary a. s., Hrusovany, the Czech Republic (chairman)Österreichische Rübensamenzucht GmbH, Tulln, Austria (chairman)Raffinerie Tirlemontoise S. A., Brussels, BelgiumSaint Louis Sucre S. A., Paris, FranceZuckerforschung Tulln GmbH, Tulln, Austria (chairman)Dr. Rudolf MüllerResponsible for agricultural policies, beet/feedstuffs and by-products, farms, research anddevelopment in the agricultural area, audit and Poland. His current term expires on September 22,2008.Memberships of domestic, statutory supervisory boards:K&S Aktiengesellschaft, KasselGroup company board memberships:AGRANA Beteiligungs-AG, Vienna, Austria (deputy chairman)BGD Bodengesundheitsdienst GmbH, Mannheim (chairman)Raffinerie Tirlemontoise S. A., Brussels, BelgiumREKO Erdenvertrieb GmbH, Regensburg (chairman)Saint Louis Sucre S. A., Paris, FranceSüdzucker International GmbH, Ochsenfurt (chairman)Zuckerfabrik Ropczyce, Ropczyce, Poland (chairman)Slaska Spolka Cukrowa S. A., Breslau, Poland (chairman)FrØdØric RostandChairman of the executive board of Saint Louis Sucre S. A. and responsible for bio-ethanol and canesugar. His current term expires on January 31, 2007.Memberships of comparable domestic and foreign supervisory bodies:Ebro Puleva S. A., Madrid, SpainSociØtØ Bic, Clichy, FranceGroup company board memberships:COFA (Compagnie Financi›re de l’Artois), Marconne Hesdin, FranceDistilleries Ryssen, Marconne Hesdin, FranceEastern Sugar B. V., Deurne, HollandRaffinerie Tirlemontoise S. A., Brussels, BelgiumSociØtØ Nouvelle des Sucreries de Chalon-sur-Sâone S. A., Chalon-sur-Sâone, FranceSlaska Spolka Cukrowa S. A., Breslau, PolandThe business address of the members of the supervisory board and of the management board isMaximilianstrasse 10, D-68165 Mannheim.21

CompensationThe total remuneration of the members of the management board of Südzucker AG Mannheim/Ochsenfurt paid by the company and its subsidiaries in 2002/2003 amounted to 5 4.9 million (ofwhich 5 1.3 million relates to the variable portion of the compensation) and the remuneration for themembers of the supervisory board amounted to 5 1.0 million (variable). In addition, the members ofthe management board received further remuneration of 5 0.3 million and the members of thesupervisory board received further remuneration in the amount of 5 0.1 million for carrying outmanagement functions at various subsidiaries. A total of 5 10.5 million has been provided in respectof pension obligations to former members of the management board and the supervisory board andtheir dependent relatives. Pension payments made during the year 2002/03 amounted to 5 1.1million.There are no loans outstanding by Südzucker AG Mannheim/Ochsenfurt or any of its subsidiaries toany member of the management board or the supervisory board.Share OwnershipNo member of the management board or the supervisory board individually holds sharesrepresenting 1% or more of the shares outstanding. As of July 18, 2003, as a group, members of themanagement board held 32,000 shares, representing 0.018% of the nominal share capital and, as ofJuly 30, 2003, members of the supervisory board held 15,852 shares, representing 0.009% of thenominal share capital.EmployeesOn average there were 14,855 persons employed by Südzucker Group in 2002/03, of which 11,543were employed in the sugar segment. The number of persons in the specialties segment rose to3,312, mainly as a result of the acquisitions. In the fiscal year 2001/02 the total number of employeesreported was 23,638, including Schöller Group. The comparable number of employees for 2001/02 inthe new segment structure without Schöller Group was 15,034. In 2000/01 the average number ofemployees was 28,415 and included Schöller Holding. The decline from 28,415 employees in 2000/01to 23,638 employees in 2001/02 is explained by the fact that in the business year 2001/02 the numberof employees for Schöller Holding were included with a nine months average.In the first half of the fiscal year 2003/04 the average number of employees increased to 16,250(2002/03: 12,968). This was primarily due to the consolidation of the Silesian sugar factories andVallø Saft. 12,770 employees (2002/03: 9,795) were employed in the Sugar segment, 3,480 (2002/03:3,173) were employed in the Specialties segment.Average number of employees duringFirst Half of2003/04 2002/03 2001/02Sugar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,770 11,543 12,148Specialties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,480 3,312 2,886Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,250 14,855 15,034Major ShareholdersSüddeutsche Zuckerrübenverwertungs-Genossenschaft eG, Stuttgart (SZVG) holds a majority of 56%of the shares in Südzucker AG Mannheim/Ochsenfurt for their own benefit and in trust for their ownshareholders. SZVG was founded in 1950 by Southern German beet farmers associations to enabletheir members to participate in the proceeds of the further processing of their raw materials. ZSGBRD Vermögensverwaltung GmbH holds another 10% of the shares.22

General MeetingThe general meeting of shareholders is to be held within six months of the end of the financial year.Independent AuditorsKPMG Deutsche Treuhand-Gesellschaft Aktiengesellschaft Wirtschaftsprüfungsgesellschaft, Theodor-Heuss-Anlage 12, 68165 Mannheim, has been the independent auditor of the consolidated financialstatements of Südzucker AG Mannheim/Ochsenfurt for the financial years ended February 28, 2001,2002 and 2003 and have issued an unqualified opinion in each case.The general assembly of Südzucker AG Mannheim/Ochsenfurt held on July 31, 2003, has electedPwC Deutsche Revision Aktiengesellschaft Wirtschaftsprüfungsgesellschaft, Olof-Palme-Strasse 35,60439 Frankfurt am Main, as auditor for the financial year 2003/04.Financial YearThe financial year of Südzucker AG Mannheim/Ochsenfurt begins on March 1 and ends on the lastday of February of the following year.BusinessThe Südzucker Group is currently the largest European sugar enterprise and market leader for sugarin the European Union and in the countries of Eastern Europe. Within the EU Südzucker AGMannheim/Ochsenfurt operates sugar factories in Germany, Belgium, Austria and France. Those EUfactories have a daily beet slicing capacity of more than 250,000 tonnes. The Südzucker Groupoperates in two business segments, the sugar segment and the specialties segment.The following table shows the development of sales of the Südzucker Group, both by segment andgeographic market (5 million):Südzucker GroupFirst Half of2003/04First Half of2002/03 2002/03 2001/02By SegmentSugar . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,655.1 1,664.6 3,359.2 2,758.2Specialties . . . . . . . . . . . . . . . . . . . . . . . 583.8 509.4 1,024.6 921.8By MarketGermany . . . . . . . . . . . . . . . . . . . . . . . . - - 1,360.1 1,448.6Other EU . . . . . . . . . . . . . . . . . . . . . . . . - - 2,597.4 1,873.7Eastern Europe . . . . . . . . . . . . . . . . . . . - - 402.9 339.1Other foreign countries . . . . . . . . . . . . - - 23.4 18.6Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,238.9 2,174.0 4,383.8 3,680.0The sales of Südzucker Group were influenced by the acquisition of Saint Louis Sucre, whichcontributed revenues of 5 903 million in the fiscal year 2002/03. Saint Louis Sucre was included for afull year for the first time in fiscal 2002/03. After adjusting for the acquisition of Saint Louis Sucre, thesugar segment suffered a decrease in sales, mainly due to lower C-sugar turnover. Sugar revenuesfrom quota sugar quantities sold were also lower due to the declassification of quota sugarquantities by the EU. The specialties segment reported an increase in revenues of 11.2 % to 5 1,025million, mainly through internal growth. In the first half of the fiscal year 2003/04 sugar salesdeclined slightly year-on-year due to the low levels of sales of the Eastern European groupcompanies and the unfavourable development of the world sugar price. In the specialties segment,sales increased by 14.6% in the first half of the fiscal year 2003/04 against the comparable figures oflast year due to further internal growth.23

Group sales were slightly up in the first half of the 2003/04 fiscal year, at 5 2,239 (2,174) million. In thesugar segment, sales decreased by 5 9 million to 5 1,655 (1,664) million, primarily due to lower salesof the companies in Eastern Europe. Here, the changes of the market in the run-up to the EUaccession on May 1, 2004 negatively impacted prices, albeit this effect was softened by the first fullconsolidation of the Silesian SSC-Group in the second quarter. Furthermore, the increased C-sugarexport volumes from the 2004 crop season, negative developments of the world market price forsugar and the US dollar led to a reduction of sales year-on-year. In the specialties segment, salesincreased by 5 75 million to 5 584 (509) million. This increase of 14.7% year-on-year is primarilycharacterized by the further growth in functional food and the sustained boom in discount ownbrandbusiness at Freiberger. In addition, Freiberger has been included for five months due to thechange from the calendar year to the Südzucker consolidated financial year in the first quarter andAGRANA has been consolidated for the first time.Sugar segmentOverviewThe sugar segment is comprised of Südzucker AG, Südzucker International, Saint Louis Sucre,Raffinerie Tirlemontoise Group and AGRANA Group. The segment also includes the agricultural andfeedstuffs divisions.The following table shows certain key financial data for the Südzucker Group’s sugar segment:First Half of2003/04First Half of2002/03 2002/03 2001/02Sales . . . . . . . . . . . . . . . . . . . 5 million 1,655 1,664 3,359 2,758Operating profit . . . . . . . . . . 5 million 167 182 397 328Operating margin . . . . . . . . % 10.1 11.0 11.8 11.9Capital expenditures . . . . . . 5 million 129 60 135 102Investments in financialassets . . . . . . . . . . . . . . . . . 5 million 70 18 31 1,610In the fiscal year 2002/03, the sugar segment comprised the activities of 42 (45) ( 1 ) sugar factories,two of which were cane sugar refineries. The number of factories in the European Union decreasedto 25 (28) following the closure of two factories in Germany and the sale of one sugar factory inBelgium. In April 2003, the Südzucker Group acquired 14 sugar factories in Poland. Sugar beetprocessed throughout the Südzucker Group increased by some 19% to 29.7 million tonnes (25.0million tonnes), with an increase in the European Union of some 17% to 25.7 million tonnes (22.0million tonnes) despite the sale of the Veurne factory. Growth was mainly due to higher beet crops inGermany and France and acquisitions. The sugar content throughout the Südzucker Group was17.23% (16.77%), whereby the rate in Eastern Europe was some 2 percentage points below the EUcontent. Sugar production throughout the Südzucker Group increased by 17% to 4.7 million tonnes(4.0 million tonnes), due to the greater quantity of beet processed and higher sugar content.The operating profit for the sugar segment of 5 397 million in fiscal year 2002/03 is primarily due tothe first-time full consolidation of Saint Louis Sucre, whereas the developments in the other EUcountries were influenced by a decline in the sugar export business. The results of the EasternEuropean sugar activities varied, with different countries performing unevenly.In the first half of fiscal year 2003/04, the market adjustment occurring mainly in the EasternEuropean EU accrediting countries during the current transitional period until EU membership hasled to considerable price declines. In addition, the weak US dollar, in conjunction with low prices onthe global sugar market, negatively impacted the sugar export business. This was neithercompensated by the progressive realization of additional synergy effects within the SüdzuckerGroup nor by the increased export volumes as a result of the higher 2002 crop season. Accordingly,the operating result of the sugar segment was down considerably year-on-year, at 5 167 (182) million.( 1 ) Numbers in brackets relate to the previous financial year.24

Regulation and Market DevelopmentsCMO SugarSugar markets all over the world are regulated. The EU sugar market is governed by the commonorganization of the markets in the sugar sector (the “CMO Sugar”) since 1967. As a part of theCommon Agricultural Policy of the EU its primary objectives are market stabilization, safeguardingof adequate revenues for the agricultural society and a guaranteed availability of supplies atreasonable prices. To pursue these objectives, the CMO Sugar contains the following supportivemeasures:– institutional support prices,– intervention purchases,– production quotas,– production levies and export refunds,– import duties.Institutional support prices and intervention purchasesThere are three different institutional support prices: the intervention price, the basic beet price andthe minimum beet price. The prices have been fixed until 2005/06. These support prices guarantee acertain level of income for the sugar beet farmers and for the sugar producing industry. As sugar beetis not fit for storage, intervention is valid for sugar and not for beet at a so-called intervention price,which is calculated on the basis of the beet price plus the costs of sugar processing. The interventionpurchase is designed to indemnify sugar producers for their obligation to pay at least the minimumbeet price to sugar beet farmers. Such intervention purchases are conducted either by the MemberStates’ own intervention agencies or by the EU Commission.Production quotasAll production of sugar and related products in the EU is allocated to Member States by means ofproduction quotas, and only such quota sugar can be sold within the EU, thereby limiting the sugarsupply on the Common Market. Production quotas are based on historical production levels with thelast assessment having taken place in 2001/02. The national production quotas of sugar consist of A-and B-quotas. The A- and B-quotas differ by the production levy charged. All production quantitybeyond the A- and B-quotas does not fall under the CMO Sugar and has to be sold on the worldmarket outside of the Common Market without any export refunds at lower world market prices.The current EU sugar regime entered into force on July 1, 2001 and will apply through the 2005/06marketing year. The following table shows the current production quotas before declassification:A-quotasugarB-quotasugarC-sugar2002/03Production quotas (mn tonnes) . . . . . . . . . . . . . . . . . . . 11.9 2.6 NoneThe EU has allocated the production quotas to all Member States and each Member State thenfurther allocates the “national” quota to the sugar producers in the Member State. The sugarproduction quotas allocated can be transferred between firms within the same Member State, butnot between Member States.25

Südzucker Group has been allocated the following production quotas for 2003/04 beforedeclassification (in million tonnes):QuotaSüdzucker AG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.4Saint Louis Sucre . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.8Raffinerie Tirlemontoise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.6AGRANA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.4Export refunds and production leviesExport refunds safeguard that sugar producers/exporters receive a guaranteed price for exportedsugar if the world market sugar price is lower than the intervention price within the EU. Exportedsugar produced under the A- or B-quota as well as a quantity corresponding to the imports ofpreferential sugar (sugar exempted from import duties from the African, Caribbean and Pacificcountries (ACP) and India) is eligible for export refunds. The maximum export refund equalsapproximately the difference between the white sugar intervention price and the sugar world marketprice.In addition, the CMO Sugar requires sugar beet growers and producers to pay production – and ifnecessary – supplementary levies to refinance the costs of export refunds on quota sugar exportedto the world market or of refunds for sugar used in the chemical and pharmaceutical industries. Theproduction levies are collected by the Member States’ national Intervention and Paying Agencies.The following table shows the maximum production levies and export refunds eligibility:A-quota B-quota C-quotaMaximum Production Levy (without additional levy) . . . . . . . . . 2% 39.5% NoneExport Refunds Eligibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . yes yes NoImport dutiesImport duties safeguard that the price for imported sugar is not lower than the Common Marketsugar price and enable the EU Commission to grant preferential treatment for certain countries(mainly former colonies). The import duties today consist of fixed import tariffs with the option to anadditional increase in the case of the import volume exceeding a certain level or in the case of theworld market price falling below a certain threshold.Future of the CMO SugarThe CMO Sugar was extended to June 30, 2006. However, there are pressures for reform due to WTOsubsidy restrictions and the Everything but Arms program of the EU fully liberalizing sugar importsfrom the 40 least developed countries by 2009. Within this framework, the council of ministersrequired the EU Commission to submit a report on the sugar market regulation in early 2003,accompanied by recommendations for reform.On September 23, 2003, the EU Commission presented an “option paper” to the Council and theParliament on a sustainable agricultural model for Europe focusing, inter alia, on the sugar sector.This report was supplemented by a Commission staff working paper trying to assess the impact of areform of the European Union’s sugar policy on market participants. The option paper outlines threedifferent future scenarios:– the option “status quo” would mean a prolongation of the current system with quotas for EUsugar production, border protection (duties) and export subsidies adapted to future WTOcommitments and a free market access for sugar from Least Developed Countries (LDC) and the26

Balkans. The LDC-regulation proposes that the imports will increase by 15% p. a. from 85,000 tons(2002/03) to almost 200,000 tons (2008/09) which equals approximately 1.5 % of the actualconsumption in EU-15. As of July 1, 2009, imports into the EU will be duty-free, which will causesignificant additional imports with serious implications for the European sugar industry.– the option “price fall” would seek to reduce sugar and beet prices. As suggested in the impactassessment study price reductions down to such levels would be achieved in two steps.Starting from the current regime a first price cut from a market price of 725 Euro per ton of sugardown to 600 Euro per ton of sugar (–17%) accompanied by a beet price decrease from 48 Euro to40 Euro per ton of beet (–17%) is considered to become fully effective after 2011 with a transitionalperiod of 5 to 7 years starting in 2006. This first step could imply a decrease of Südzucker Group’sresults but still within a manageable range. Additionally, there is time to take the necessaryactions and adjustments.By the end of this period in 2011/2013 – within a two to three year transitional period – further pricecuts down to 450 Euro per ton of sugar (–38%) combined with a disproportional beet pricereduction down to 25 Euro per ton of beet (–48%) are assumed. Beet growers would be partlycompensated for the price cut. At the final stage, intervention prices and quotas would beabolished.– In the option “liberalization” all regulations (quotas, border protection, export restitutions) wouldbe abolished. According to the experiences with the implementation of WTO commitments andconsidering the recommendations of the impact assessment study, full liberalization would notbecome effective before 2011. Südzucker Group believes that it would be able to adoptappropriate measures to keep its leading European market position on a profitable basis.The Commission expects this working paper to become the starting point of a public debate aboutadvantages and disadvantages of each scenario and that it might ultimately develop into aCommission proposal to the Council of Ministers. Any Commission proposal, however, will not bebinding on the European legislator and from today’s perspective it is not foreseeable how thepolitical process will influence the future of the EU sugar market order. Any changes to the currentmarket order are expected to become fully effective only after a transitional period of several years.World Trade Organization negotiationsAt the start of negotiations for a new round of World Trade Organization negotiations in Doha, theWTO members committed to agree by March 31, 2003 on a framework within which the various WTOmembers would submit recommendations by the end of 2003 to reduce their subsidies. However, theindividual recommendations are so far apart that, as expected, it was not possible to reach anagreement on time. The suggestion made by the head of the WTO agricultural negotiations wouldrequire a decrease of 60% in customs duty for the European sugar sector. The offer of the EuropeanCommission to reduce customs duties by an average of 36%, but at least by 15% per product line,would limit the impact for domestic beet farmers and sugar producers.In Cancun on September 14, 2003, the WTO Ministerial Conference, where an agreement foragriculture was expected, failed. The participants were unable to find an agreement on the so calledSingapore issues (trade facilitation, government procurement, investment protection andcompetition). For agriculture a draft was discussed with the following items relevant for sugar:– On exports the draft proposes an end date for phasing out all forms of export subsidies. The sugarindustry has generally shown flexibility with respect to the reduction of export refunds. Due to theself-financing character of the sugar market regime, the impact of such measure would be limited.– On imports, products are assigned into three categories: those for which the so-called Uruguayformula would be valid (minimum cut of import tariffs for each product, 36% on average), thosefor which the so-called Swiss formula should be used (cut of tariffs to a maximum of 25% of worldmarket price) and those for which all import duties should be cancelled. These measures aresupposed to be introduced within a transition period. Sugar as a so-called “sensitive” productwould likely be part of the first category. A resulting percentage-cut in prices would be smaller27

than the percentage-cut in tariffs as long as the currently discussed WTO-“special safeguardclause”, which allows additional import duties under certain circumstances, remains applicable.After the failure of the Cancun Conference, future results of the Doha Development Agenda areuncertain.In August 2003, Brazil complained to the WTO about European Union C-sugar exports and there-exports of sugar imported from African, Caribbean and Pacific (ACP) countries, with the aim tostop these exports. Südzucker believes there are good arguments for the European Union to win thecase. Losing C-sugar exports would have adverse consequences for the Südzucker Group’s results ofoperation. The abolishment of ACP-re-exports would reduce the domestic market for European beetsugar by 1.6 million tons of sugar, which would have more pronounced negative effects on theSüdzucker Group as compared to the loss of C-sugar exports. A decision is expected in 2004.Declassification and production levyIt is possible for the EU Commission to temporarily lower the maximum EU production quota(“declassification”) in order to track changes in consumption and exports and thus comply with WTOcommitments. In 2001, the EU Commission made no use of the declassification. In September 2002, ahigh EU declassification coefficient of 5.7% was set for production from the 2002/03 campaign.The basic overall production levy on B-sugar for the 2001/02 sugar year reached the maximumproduction levy of 39.5% of the intervention price. Furthermore, a supplementary levy of 8.3% wasagreed. Contrary to the sugar year 2002/03 the overall production levy on B-sugar was only 22.0% ofthe intervention price and no additional levy was necessary. This displays the self-financing characterof the sugar market regime. In years with a high declassification quota sugar exports are lower anddue to this production levy declines.EU member candidatesThe governments of all EU candidate countries have agreed to the EU membership treaties. Thismeans that the expansion of the EU by a further 10 countries on May 1, 2004 can be completed asplanned.With respect to sugar, the EU has made considerable concessions to its negotiation terms on sugarproduction quotas for the applicant countries. The largest quota holder is Poland, with a maximumquota of 1.674 million tonnes of sugar, followed by the Czech Republic and Hungary with 0.454 milliontonnes and 0.402 million tonnes of sugar, respectively. Südzucker’s quota share in EU-25 will behigher than it was in EU-15 because of strong market shares in Poland, the Czech Republic, Hungaryand Slovakia. The Südzucker Group expects to benefit from the EU-enlargement.EU sugar production up by 11%Sugar production in the EU reached 17.02 million tonnes (14.94 million tonnes), back to almost thesame level as in 2000. The main reason for the growth in 2002 was a rise of 2.7% in the area undercultivation for sugar beet in the EU, to 1.835 million hectares (1.788 million hectares) and in sugarproduction to 9.06 tonnes per hectare (8.11 tonnes per hectare). Almost 912,000 tonnes (385,000tonnes) of C-sugar was transferred to the 2003/04 sugar year.Performance of the Sugar SegmentBeet harvest and sugar productionThe area under beet cultivation for the Südzucker Group in the fiscal year 2002/03 rose to 472,400hectares (465,100 hectares). The reduction in area under cultivation due to the disposal of Veurne,28

the Belgium sugar factory, was more than offset by an expansion in Germany and France. Within theEU, the area under cultivation rose to 373,400 hectares (370,500 hectares) and in Eastern Europe to99,000 hectares (94,700 hectares).The following table provides an overview of Südzucker Group’s most important sugar productiondata (excluding raw sugar raffination) for the last two fiscal years:2002/03 2001/02GermanyArea under cultivation . . . . . . . . . . . . . . . . . . . . . . . . 1000 hectares 177.8 172.2Beet harvest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . million tonnes beet 11.8 10.1Sugar production . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1000 tonnes sugar 1,756 1,530BelgiumArea under cultivation . . . . . . . . . . . . . . . . . . . . . . . . 1000 hectares 64.3 70.8Beet harvest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . million tonnes beet 4.2 4.0Sugar production . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1000 tonnes sugar 681.0 634.2FranceArea under cultivation . . . . . . . . . . . . . . . . . . . . . . . . 1000 hectares 86.8 82.8Beet harvest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . million tonnes beet 6.7 5.1Sugar production . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1000 tonnes sugar 995.0 757.7AustriaArea under cultivation . . . . . . . . . . . . . . . . . . . . . . . . 1000 hectares 44.5 44.7Beet harvest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . million tonnes beet 3.0 2.8Sugar production . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1000 tonnes sugar 456.0 423.4AGRANA InternationalArea under cultivation . . . . . . . . . . . . . . . . . . . . . . . . 1000 hectares 54.0 57.5Beet harvest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . million tonnes beet 2.3 2.1Sugar production . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1000 tonnes sugar 309.0 280.0PolandArea under cultivation . . . . . . . . . . . . . . . . . . . . . . . . 1000 hectares 27.1 8.1Beet harvest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . million tonnes beet 1.2 0.3Sugar production . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1000 tonnes sugar 164.0 41.5MoldovaArea under cultivation . . . . . . . . . . . . . . . . . . . . . . . . 1000 hectares 17.9 29.0Beet harvest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . million tonnes beet 0.5 0.6Sugar production . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1000 tonnes sugar 51.0 64.9GroupArea under cultivation . . . . . . . . . . . . . . . . . . . . . . . . 1000 hectares 472.4 465.1Beet harvest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . million tonnes beet 29.7 25.0Sugar production . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1000 tonnes sugar 4,412.0 3,731.7Due to unusually good weather conditions for beet growth in Germany, beet and sugar yields werehigh in the areas covered by Südzucker AG. For Südzucker AG, yields were only just lower than for2000, a record year. With an area under cultivation of 177,800 hectares (172,200 hectares), a total of1.756 million tonnes (1.53 million tonnes) of sugar were produced from 11.8 million tonnes (10.1million tonnes) of beet with a sugar content of 17.2 % (17.4 %).In Belgium, the area under cultivation decreased to 64,300 hectares (70,800 hectares) due to the saleof Veurne, the sugar factory. The high beet yield of 66.1 tonnes per hectare (57.1 tonnes per hectare)nevertheless led to an increased beet harvest of 4.2 million tonnes (4.0 million tonnes). 681,000tonnes (634,200 tonnes) of sugar were produced.In France, ideal weather conditions in the area under cultivation for Saint Louis Sucre led to aconsiderably higher beet yield than for the previous year and an exceptional sugar yield. 6.7 milliontonnes (5.1 million tonnes) of beet were harvested from 86,800 hectares (82,800 hectares), fromwhich 995,000 tonnes (757,700 tonnes) of sugar were produced.29

In Austria, the beet yield was 68.2 tonnes per hectare (62.0 tonnes per hectare) for AGRANA,considerably higher than for the previous year, whereas sugar content was somewhat lower, at16.5% (16.8%). 3.0 million tonnes (2.8 million tonnes) of beet were yielded from 44,500 hectares(44,700 hectares) of land, from which 456,000 tonnes (423,400 tonnes) of sugar were processed. Beetprocessing lasted 83 days (77 days). The seven factories belonging to AGRANA International locatedin the central and eastern European countries processed 309,000 tonnes (279,800 tonnes) of sugarfrom 2.3 million tonnes (2.1 million tonnes) of beet, grown on 54,000 hectares (57,500 hectares) ofland. Including raw sugar refining of 144,000 tonnes (132,000 tonnes), sugar production reached453,000 tonnes (412,000 tonnes).Due to good weather conditions and progress in planting technology, the beet harvest in the areaunder cultivation in Poland for the 6 (3) factories of Südzucker International was some 20% higherthan for the previous year, at 44.3 tonnes per hectare (36.8 tonnes per hectare). As in the previousyear, the sugar yield was relatively low, at 15.7% (15.9%), due to the wet autumn weather. Followingthe acquisition of the Przeworsk sugar factory and the change in companies included in theconsolidation, the area under cultivation increased to 27,100 hectares (8,100 hectares). 164,000tonnes (41,500 tonnes) of sugar were produced from 1.2 million tonnes (0.3 million tonnes) of beet.In Moldova the beet harvest could be increased to 28.4 tonnes per hectare (21.7 tonnes per hectare),due to sufficient rainfall in summer. Lack of technical equipment and pesticides led to anunsatisfactory beet quality. 0.5 million tonnes (0.6 million tonnes) of beet with a sugar content of13.9% (15.0%) were harvested from 17,900 hectares (29,000 hectares). 51,000 tonnes (64,900 tonnes)of sugar were processed in a campaign lasting 58 days (58 days).The harvest expectations for 2003 are less favorable, mainly due to the impact of the long droughtperiod during the summer, in particular in Germany.Sugar sales volumesThe EU companies in the Südzucker Group reached last year’s levels of sugar sales in the EU, at2.6 million tonnes. At 1.2 million tonnes (1.5 million tonnes) of sugar, exports were down due tolower quantities available.At 1,605,700 tonnes (1,836,600 tonnes) of sugar, total sales volumes of Südzucker AG and SüdzuckerGmbH (merged into Südzucker AG effective March 1, 2003) in the fiscal year 2002/03 were lower thanfor the previous year, due to the considerable decline in volumes available for export as a result of theharvest. Sugar sales volumes for Südzucker AG in the EU increased by 2.4% to 1,245,000 tonnes(1,216,100 tonnes). Exports to other countries declined to 360,700 tonnes (620,500 tonnes) due to thelower volumes available for export. General consumer reticence (trade associations speak of one ofthe worst years ever for the sector) further increased price competition in the food retailing industry.With its range of branded articles, Südzucker is directly affected by this trend, but is also indirectlyaffected via sales volumes to its industrial customers. Volume declines at customers in the brandedgoods area and higher sales volumes to customers producing own-name articles provide evidence ofa changing market. This development was particularly noticeable in the drinks industry, Südzucker’slargest sugar customer.Total sales volumes at Raffinerie Tirlemontoise rose by 4% due to higher sugar production in the2002/03 campaign. Sales volumes in the EU declined slightly, whereby gains in the end-consumermarket could not fully compensate for declines in the industrial area. Ti´Light, the low-calorieproduct, sales of which are still growing rapidly, was supplemented by Ti´Flora and Ti´Calcium, bothhealth-related products. Candico, a subsidiary, could further extend its market position in theretailing and industrial sectors.Sugar sales volumes at Saint Louis Sucre were 1,121,600 tonnes (1,144,000 tonnes) in the fiscal year2002/03 (beet and cane sugar); its position in the EU could again be defended. Whereas the Frenchand German markets are supplied from northern France, Saint Louis Sucre has a refinery inMarseilles in a good geographic position to supply Italy and Spain. The company’s market position30

in France could be extended, particularly by strengthening the Saint Louis, Tutti Free and CarteBlanche brands.Sugar sales volumes for AGRANA in the fiscal year 2002/03 could be maintained at almost the samelevel as for the previous year, at 436,000 tonnes (444,000 tonnes). In addition to overall consumerreticence, in particular imports from the neighboring Balkan region under the terms of the EU treatyled to a decline in domestic sales to 309,000 tonnes (326,000 tonnes). Household sugar sales andsales to the Austrian food industry were equally affected. The introduction of a compulsorypackaging charge in Germany further reduced exports by the Austrian drinks industry of products innon-returnable packaging and hence domestic sales volumes in Austria. Including increased salesvolumes of sugar by subsidiaries in the central and eastern European countries of 475,000 tonnes(398,000 tonnes), the AGRANA Group achieved an overall sugar sales volume of 911,000 tonnes(849,000 tonnes).A total of 750,000 tonnes (970,000 tonnes) of sugar from Belgium, Germany and Austria wereexported to third countries during the fiscal year 2002/03 via Südzucker Group Export Centre. Thereason for the sharp decrease was a smaller harvest by the Südzucker Group in 2001. Due toincreased deliveries by competitors, above all from Brazil, Südzucker Group had to reduce itsexports to Africa and the Middle East.Sales volumes for the six Polish factories rose to 128,000 tonnes (118,000 tonnes) of sugar. The Polishsugar market is suffering from considerable overcapacity. Formation of a state Polish sugar companydid not lead to market stabilization, as the liquidity of many factories determines sales policy.The market position in Moldova could further be extended. Cancellation of the trade agreementbetween Moldova and the Ukraine led to a halt for exports to the Ukraine.AgricultureOperations of the Südzucker agriculture division again delivered positive results due to the excellentsugar beet yield and quality in the fiscal year 2002/03. Agricultural research carried out in many areasled to new knowledge, underscoring the reliable performance by agriculture. The main areas ofresearch continued to be soil processing and a selective area of cultivation approach to farming. Thefindings enable various regions of Europe to implement optimal soil processing and an ideal supplyof nutrients to sugar beet, resulting in high yields per hectare and good quality. Use of this know-howat farms in Moldova and Poland as well as in other eastern European countries has been particularlysatisfactory.FeedstuffsPellets and molasses, sugar processing by-products, could be marketed in line with budget at allgroup companies. In Germany, sales volumes of molasses shavings and molasses shaving pelletsfell slightly due to lower quantities available, but more financially viable freight distances led toimproved yields. Molasses sales volumes continue to shift towards the yeast industry, whose needsare met by high quality molasses. Raffinerie Tirlemontoise and Saint Louis Sucre have also fullyachieved their objectives for sales of molasses.Sales volumes of pellets and molasses by AGRANA were in line with budget. The main customers formolasses from Eastern Europe were the yeast and alcohol industries in Poland, Moldova, Romania,the Czech Republic, Slovakia and Hungary.BodengesundheitsdienstBGD Bodengesundheitsdienst GmbH, Mannheim, is a wholly-owned Südzucker subsidiary andcarries out services for agriculture. Its services include soil examination and fertilisation advice for all31

major plant foodstuffs, examination of humus and analyses of organic fertiliser. Furthermore, as partof statutory requirements, nutrient comparisons are carried out as part of the fertilization ordinance,and potatoes are tested as required by the official potato ordinance. The main source of revenues isfertilization advisory services. These are carried out using the EUF soil examination method, whichidentifies all the major plant nutrients (nitrogen, phosphate, potash, lime, calcium, magnesium,boron and sulphur) from a soil sample and hence determines crop- and site-related fertilizationrecommendations. A study for threadworm based on a DNA test is a new service. This threadwormtest was developed in co-operation with the Biological Federal Office, the State Office for Agriculturein Freising and Beet Planters Associations. The threadworm test delivers criteria for steps to be takento reduce threadworm when planting in affected areas such as, for example, intercropping specialcrops or varieties.REKOREKO Erdenvertrieb GmbH produces high-quality compost and substrate soil from vegetation andsoil cling on beet delivered to the factories. The favorable weather conditions for growth in the yearended February 28, 2003 led to a further increase in the quantities of vegetation delivered and henceto higher revenues from supplies of vegetation. Due to the partly extreme levels of rainfall in theautumn, quantities sold were slightly down on the previous year, as soil processing was hardlypossible during this time. However, this decline in revenues was more than offset by the increase inrevenues from receiving vegetation.Specialties SegmentOverviewThe Specialties segment is comprised of the Palatinit, ORAFTI and starch divisions, together withactivities of the Portion Pack, Surafti and Freiberger Groups.The following table shows key financial data of Südzucker Group’s Specialties segment:First Halfof 2003/04First Halfof 2002/03 2002/03 2001/02Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 million 584 509 1,025 922Operating profit . . . . . . . . . . . . . . . . . . 5 million 65 53 123 93Operating margin . . . . . . . . . . . . . . . . . % 11.1 10.3 12.0 10.0Capital expenditures . . . . . . . . . . . . . . 5 million 39 33 72 76Investments in financial assets . . . . . 5 million 27 14 14 61The Specialties segment achieved growth of 32.3% in operating profits to 5 123 million in the fiscalyear 2002/03 in comparison to the previous year’s result excluding Schöller. The increase in profitswas achieved through targeted acquisitions, particularly with the purchase of Remy Industries in theORAFTI division, as well as continued internal growth in all divisions comprising the Specialtiessegment. Further internal growth is also responsible for the increase in sales in the first half of thefiscal year 2003/04 as compared to the first half of the fiscal year 2002/03. The increase of theoperating result in the specialties segment to 5 65 (5 53) million primarily reflects additional growthin functional food and the good situation in the discount sector of German retail, in conjunction withthe fact that the inclusion period of Freiberger is two months longer.Palatinit & Orafti GroupPalatinit GmbH, Mannheim, the leading producer of raw materials for sugar-free confectionery withIsomalt, could extend its market position in the fiscal year 2002/03, although negative currencyeffects and increased competition presented difficult overall conditions. Volumes of sales to astagnating confectionery industry could be increased. Demand is growing rapidly in the sugar-free32

confectionery sector for products such as caramel cream or strawberry cream. Internationalproducers have decided in favour of using Isomalt from Palatinit for these products. There has beenfurther satisfactory growth in sales of sugar-free functional food products containing Isomalt in Asianmarkets, which tend to be open to traditional, health-inducing ingredients and which makesuccessful use of a modern sugar-free sweetener.The business segments of the ORAFTI Group have developed strongly in the fiscal year 2002/03 andwere able to strengthen their market penetration with functional food, textured consumables andspecific fluid sweeteners.The “active food ingredients” division (inulin and oligofructose for human and animal nutrients) wasagain marked by strong sales growth in fiscal year 2002/2003. More than 300 new foodstuffs wereintroduced with ORAFTI products RAFTILINE and RAFTILOSE. Markets in Asia were particularlystimulated by stressing the beneficial pre-biotic effect of products on health. In America and Europethe topics of fibre and improved calcium intake were grounds for success. There is growing interestin using inulin as a fat substitute. This trend is supported by consumer fears about obesity anddiabetes, to which producers have reacted by introducing lower-calorie products on the market. Afurther growth driver is interest in foodstuffs with low carbohydrates, for which inulin andoligofructose are ideal ingredients. ORAFTI was subject to aggressive price competition for inulinproducts on certain markets.The “liquid sweeteners” division profited from higher demand for specially-designed liquidsweeteners. Both sales and profits rose in fiscal year 2002/2003 despite price pressures fromimported fructose.StarchSüdzucker Group’s starch activities are mainly carried out by AGRANA, one of the largest businessto-businesssuppliers on the European market in the biological and GM-free sectors. The starchdivision performed satisfactorily in the fiscal year 2002/03. Despite a market-related decline in prices,revenues increased by 12% to 5 209.9 million (5 187.5 million), mainly due to entry into new marketsand a successful upgrading strategy. Operating profits also continued to improve in fiscal year 2002/2003. In Austria, sales volumes of cornstarch based products increased particularly satisfactorily,with a rise of 17%. Sales volumes divided into food and non-food applications show an increase inthe non-food/technical starch area, although at the expense of lower prices, of almost 27%, whereasturnover volumes in the food area only rose slightly.Portion Pack Europe (PPE)Portion Pack Europe Group’s turnover rose by more than 30% in the fiscal year 2002/03, to 5 125million. 7.5 % of this increase related to internal growth, with the rest attributable to the purchase ofPortion Pack Landgraf (Holland) and Cocachoc, Belgium. The European-wide group specializes inportion packs for the catering and wholesaler sectors and is increasingly entering niche markets forits various customer groups.SuraftiThe Surafti Group delivers mainly sugar-based niche products to the processing industry for bakeryproducts. Production is located at six medium-sized operations in four countries. Acquisitionsstrengthened the nougat activities in France in the fiscal year 2002/03.Freiberger GroupFreiberger Group has a leading position in the frozen pizzas and baguettes market throughoutEurope. Top-quality products are produced using state-of-the-art technology at production locations33

in Berlin, Muggensturm (Baden) and Oberhofen (Austria). They are mainly offered as individual ownnameproducts designed specifically to meet customer requirements. Freiberger could profit fromthe continuing upward trend on the German frozen pizza market, particularly with own-nameproducts. Furthermore, entry into other European markets continued to be successful and this hasled to satisfactory growth.Principal SubsidiariesThe Südzucker Group consists of four sub-groups, Südzucker AG Mannheim/Ochsenfurt (includingFreiberger), Raffinerie Tirlemontoise S. A. (85.41% Südzucker subsidiary), Saint Louis Sucre S. A.(85.19% Südzucker subsidiary) and AGRANA Beteiligungs-Aktiengesellschaft (44.87% Südzuckersubsidiary).The following table shows selected information regarding certain principal subsidiaries of SüdzuckerAG Mannheim/Ochsenfurt. For a complete list of principal subsidiaries, please refer to the 2002/03annual financial statements.Principal entities of Südzucker Group (as of February 28, 2003)RegisteredOfficeField ofActivityIssuedCapitalParticipationPercentageReservesTotalequityIncomeaftertaxesTotalAssetsName% (in 5 mio.)Südzucker AG (parent company) . . . . . . Mannheim Sugar 174.8 2,146.5 2,321.3 222.3 4,249.0Raffinerie Tirlemontoise S.A. . . . . . . . . . Brussels, Sugar 85.4 80.0 1,847.5 1,927.5 68.9 3,752.5BelgiumSaint Louis Sucre S.A. . . . . . . . . . . . . . . .AGRANA Beteiligungs-Aktiengesellschaft . . . . . . . . . . . . . . . . .Freiberger Lebensmittel GmbH & Co.Prod.-/Vertr. KG . . . . . . . . . . . . . . . . . . .Paris,FranceVienna,AustriaBerlinSugar 85.2 37.0 227.5 264.5 138.1 566.8Holding 44.9 80.1 252.8 332.9 27.5 385.6FrozenFood100.0 25.6The book value of the Raffinerie Tirlemontoise S. A. participation in the statutory accounts ofSüdzucker AG amounted to 5 1,914.9 million; the investment earnings in 2002/03 were 5 14.1 million.Acquisitions and DivestituresCapital expenditures for tangible and intangible non-current assets in the Südzucker Groupamounted to 5 207 million in the fiscal year 2002/03, compared to 5 219 million in 2001/02 and 5 214.5million in 2000/01 (2000/01 and 2001/02 figures include Schöller Holding). In the first six months offiscal year 2003/04, capital expenditures amounted to 5 168 million. Investments in financial assets(including acquisitions) amounted to 5 46 million in the fiscal year 2002/03, compared to 5 1,671million in 2001/02 and 5 37 million in 2000/01. In the first six months of fiscal year 2003/04,investments in financial assets amounted to 5 97 million.The 5 1,671 million investment in 2001/02 is mainly attributable to the acquisition of 100% of theshares in Saint Louis Sucre in December 2001 which alone accounted for 5 1.6 billion. The acquisitionprice was financed by a capital increase carried out in September 2001, the disposal of SchöllerHolding and Fresenius shares, and the issue of a bond in the amount of 5 500 million.In its business year 2001/02 Südzucker implemented its strategic concentration on its core businessof sugar/sweeteners and sold the Schöller Holding Group, thus disposing of most of the ice cream/34

frozen food segment. NestlØ acquired all the shares in Schöller Holding Group from Südzucker andthe Schöller family.In December 2001 the Orafti business area was extended by the acquisition of Remy Industries,Leuven, Belgium, a producer of rice-based starch, rice flour and rice-based protein.In November 2001 AGRANA acquired S. C. A. G.F. D. Tandarei S. A., the Romanian corn-starch factory,whose production capacity is currently being expanded from 80 to 100 tonnes of corn processeddaily for the production of corn starch and corn syrup.The Polish state treasury ministry approved the sale of Slaska Spolka Cukrowa to Saint Louis Sucreon March 26, 2003. With this acquisition, Südzucker has reached a market share of 25% in Poland, thethird largest sugar producing country in Europe. A newly-established group in Poland, consisting ofthe 14 new factories and the existing 6 factories, will be the country’s second-largest sugar company,with an EU quota of 422,000 tonnes of sugar and sales of approximately 5 300 million.Südzucker is currently planning a net investment of 5 125 million into a new production plant forbio-ethanol at an existing sugar plant in Germany.Within the Specialties segment AGRANA has commenced a new business field of fruit juice andconcentrate. To achieve a relevant market position, it has recently acquired the Danish fruit juiceconcentrate producer Vallø-Saft A/S, with annual sales of approximately 5 40 million, and a minorityinterest in Austrian Steirerobst AG. Südzucker Group will further expand this business field throughorganic growth as well as complementary acquisitions.Third party investors are currently holding preferred shares of Raffinerie Tirlemontoise S. A.,representing 14.2% of the total share capital of Raffinerie Tirlemontoise S. A. Südzucker intends toexercise its call option on such shares at a purchase price of 5 368 million, becoming effective inMarch 2004. The savings on dividend payments to minorities, with effect as of fiscal year 2004/05,will amount to 5 26 million.Research and DevelopmentSüdzucker Group’s research and development work is concentrated on new products or productvariants, optimizing production processes and supporting marketing activities. The range of tasksstretches from agricultural production to sugar, sugar-free sweeteners, starch, and inulin productdivisions and their related products, through to application technology in the food and non-foodareas. This work is carried out by about 200 employees at four group locations. In the recent past keypoints in the R&D program were the development of new customer-tailored products for fondants,caramels and icing sugar. Further research projects include new functional carbohydrates and theuse of sugar or other carbohydrates as renewable raw materials in non-food applications such ashydraulic fluids.In the fiscal year 2002/03 fifteen new patents were registered and 5 25.5 million was spent on researchand development.Real EstateThe Südzucker Group holds real estate of 6,622 hectares. Agricultural areas of 8,726 hectares areleased in Germany.LitigationNeither Südzucker nor any of its consolidated subsidiaries is or has during the last two financial yearsbeen engaged in any litigation or arbitration proceedings which may have or have had during such35

period a significant effect on the financial position of Südzucker, nor, as far as Südzucker is aware, areany such litigation or arbitration proceedings pending or threatened.Patent and License MattersNeither Südzucker nor any of its consolidated subsidiaries is or has during the last three financialyears been dependant on patents or licenses which may have or have had during such period asignificant effect on the financial position of the Issuer and/or the Guarantor, nor, as far as the Issueror the Guarantor is aware, are any such patents or licenses pending.36

Südzucker International Finance B.V.Oud-Beijerland, Niederlande7 250.000.0003,00% Schuldverschreibungen von 2003/2008mit Wandlungsrecht in auf den Inhaber lautendeStammaktien ohne Nennbetrag derSüdzucker AG Mannheim/Ochsenfurtunbedingt und unwiderruflich garantiert durch dieSüdzucker AG Mannheim/OchsenfurtSüdzucker International Finance B.V.Oud-Beijerland, The Netherlands7 250,000,0003.00% Bonds of 2003/2008Convertible into OrdinaryBearer Shares with No Par Value of Südzucker AGunconditionally und irrevocably guaranteed bySüdzucker AG Mannheim/Ochsenfurt,Mannheim, Federal Republic of GermanyANLEIHEBEDINGUNGEN§1(Allgemeines)(1) Nennbetrag und Stückelung. Die von der SüdzuckerInternational Finance B.V., Oud-Beijerland, einer Gesellschaftniederländischen Rechts (die „Anleiheschuldnerin“),begebene Wandelschuldverschreibung im Gesamtnennbetragvon5 250.000.000(in Worten: Euro zweihundertfünfzig Millionen)ist eingeteilt in 250.000 untereinander gleichberechtigteauf den Inhaber lautende Teilschuldverschreibungen (die„Schuldverschreibungen“) im Nennbetrag von jeweils5 1.000 (der „Nennbetrag“).(2) Verbriefung und Girosammelverwahrung. Die Schuldverschreibungenwerden durch eine auf den Inhaber lautendeGlobalurkunde (die „Globalurkunde“) ohne Zinsscheineverbrieft. Die Globalurkunde wird von ClearstreamBanking AG, Frankfurt am Main („Clearstream Frankfurt“)verwahrt, bis alle Verpflichtungen der Anleiheschuldnerinaus den Schuldverschreibungen erfüllt sind. Die Globalurkundeträgt die eigenhändigen Unterschriften zweier fürdie Anleiheschuldnerin vertretungsberechtigter Personenund ist von oder im Namen der Zahlstelle (§ 17(1)) mit einerKontrollunterschrift versehen. Effektive Schuldverschreibungenund Zinsscheine werden nicht ausgegeben.(3) Lieferung von Schuldverschreibungen. Die Schuldverschreibungensind gemäß den Regeln der ClearstreamFrankfurt und außerhalb der Bundesrepublik Deutschlandgemäß den Regeln der Clearstream Banking S. A., Luxemburg(„Clearstream Luxemburg“), und der Euroclear BankS.A./N. V., Brüssel, als Betreiber des Euroclear Systems(„Euroclear“) übertragbar.§2(Zinsen)(1) Zinssatz und Fälligkeit. Die Schuldverschreibungenwerden vom 8. Dezember 2003 (der „Emissionstag“) aneinschließlich mit jährlich 3,00% verzinst. Die Zinsen sindhalbjährlich nachträglich am 8. Dezember und 8. Junieines jeden Jahres (jeweils ein „Zinszahlungstag“) zahlbar.Die erste Zinszahlung ist am 8. Juni 2004 fällig. DerZinslauf der Schuldverschreibungen endet mit Ablauf desTages, der dem Tag, an dem sie zur Rückzahlung fälligwerden, unmittelbar vorausgeht, oder, wenn das Wandlungsrecht(§ 6(1)) ausgeübt wurde, mit Ablauf des Tages,der dem letzten Zinszahlungstag vor dem Ausübungstag(§ 7(4)) unmittelbar vorausgeht oder, falls kein Zinszahlungstagvorausgeht, dem Emissionstag. Sofern die Anleiheschuldnerindie Schuldverschreibungen nicht bei Fälligkeitzurückzahlt, endet der Zinslauf erst mit Ablauf desTages vor dem Tag der tatsächlichen Rückzahlung derSchuldverschreibungen.TERMS AND CONDITIONS§1(General Provisions)(1) Principal Amount and Denomination. The convertiblebond issue by Südzucker International Finance B.V, Oud-Beijerland, a company incorporated under the laws of TheNetherlands (the “Issuer”), in the aggregate principalamount of5 250,000,000(in words: euro two hundred and fifty million)is divided into 250,000 bonds in bearer form (the“Bonds”) in a principal amount of 5 1,000 (the “PrincipalAmount”) each, ranking pari passu among themselves.(2) Global Certificate and Custody. The Bonds arerepresented by a global certificate (the “GlobalCertificate”) in bearer form without interest coupons. TheGlobal Certificate will be deposited with ClearstreamBanking AG, Frankfurt am Main (“Clearstream Frankfurt”)and will be kept in custody with Clearstream Frankfurtuntil all obligations of the Issuer under the Bonds havebeen discharged. The Global Certificate shall be manuallysigned by two authorized representatives of the Issuer andmanually authenticated by or on behalf of the PayingAgent (§ 17(1)). Definitive certificates representingindividual Bonds and interest coupons shall not be issued.(3) Delivery of Bonds. The Bonds shall be transferablepursuant to the rules of Clearstream Frankfurt and,outside the Federal Republic of Germany, of ClearstreamBanking S.A., Luxembourg (“Clearstream Luxembourg”)and Euroclear Bank S. A./N.V., Brussels, as operator of theEuroclear system (“Euroclear”).§2(Interest)(1) Interest Rate and Interest Payment Dates. The Bondswill bear interest at the rate of 3.00% per annum from andincluding December 8, 2003 (the “Issue Date”). Interestwill be payable semi-annually in arrears on December 8and June 8 of each year (each, an “Interest PaymentDate”), commencing on June 8, 2004. Interest shall ceaseto accrue with the expiration of the day whichimmediately precedes the day on which the Bondsbecome due for redemption, or, if the Conversion Right(§ 6(1)) has been exercised, with the expiration of the daywhich immediately precedes the last Interest PaymentDate prior to the Conversion Date (§ 7(4)), or if there wasno Interest Payment Date, the Issue Date. If the Issuer failsto redeem the Bonds on the day on which they becomedue for redemption, interest shall cease to accrue on theday preceding the day of actual redemption of the Bonds.37

(2) Stückzinsen. Sind Zinsen für einen Zeitraum von wenigerals einem Jahr zu berechnen, so werden sie auf derGrundlage der tatsächlich verstrichenen Tage, geteiltdurch 365 (bei nicht in ein Schaltjahr fallenden Tagen)bzw. 366 (bei in ein Schaltjahr fallenden Tagen), berechnet.(2) Accrued Interest. If interest is required to be calculatedfor a period of less than one year, it will be calculated onthe basis of the actual number of days elapsed, divided by365 (those days not falling in a leap year) or 366 (thosedays falling in a leap year), as the case may be.§3(Endfälligkeit, Rückerwerb, Vorzeitige Rückzahlung)(1) Endfälligkeit. Die Schuldverschreibungen werden am8. Dezember 2008 (der „Rückzahlungstag“) zu ihremNennbetrag zuzüglich auf den Nennbetrag bis zum Rückzahlungstag(ausschließlich) aufgelaufener Zinsen zurückgezahlt,sofern sie nicht vorzeitig zurückgezahlt, gewandeltoder zurückgekauft und entwertet worden sind.(2) Rückerwerb. Die Anleiheschuldnerin und/oder SüdzuckerAG Mannheim/Ochsenfurt, Mannheim, BundesrepublikDeutschland (die „Garantin“), und/oder ein mit ihnenverbundenes Unternehmen ist berechtigt, jederzeitSchuldverschreibungen im Markt oder auf andere Weisezu erwerben. Die zurückerworbenen Schuldverschreibungenkönnen gehalten, entwertet oder wieder verkauft werden.(3) Vorzeitige Rückzahlung nach Wahl der Anleiheschuldnerin.Die Anleiheschuldnerin ist berechtigt, die Schuldverschreibungenan oder nach dem 9. Dezember 2006 insgesamt,nicht jedoch teilweise, jederzeit mit einer Frist vonmindestens 20 und höchstens 40 Tagen durch Bekanntmachunggemäß § 18 zu kündigen und vorzeitig zum Nennbetragzuzüglich der darauf bis zum Tag der Rückzahlung(ausschließlich) aufgelaufenen Zinsen zurückzuzahlen,wenn der nicht gewichtete arithmetische Durchschnitt derBörsenpreise der Stammaktien der Garantin in derSchlussauktion im Xetra-System der Deutsche Börse AG(oder einem Nachfolgesystem) (ein solcher täglicher Börsenkursim Folgenden die „Xetra-Notierung“) an mindestens20 der 30 Handelstage an der Frankfurter Wertpapierbörse(jeweils ein „Handelstag“) unmittelbar vor Bekanntmachungder Kündigung 130% des dann geltendenWandlungspreises (§ 6(1)) übersteigt. Die Kündigungserklärungist unwiderruflich und muss den Tag der vorzeitigenRückzahlung angeben.(4) Vorzeitige Rückzahlung nach Wahl der Anleiheschuldnerinauf Grund Geringfügigkeit des ausstehenden Nennbetrags.Die Anleiheschuldnerin ist berechtigt, mit einerFrist von mindestens 20 und höchstens 40 Tagen durchBekanntmachung gemäß § 18 die noch ausstehendenSchuldverschreibungen insgesamt, nicht jedoch teilweise,zu kündigen und vorzeitig zum Nennbetrag zuzüglich derdarauf bis zum Tag der Rückzahlung (ausschließlich) aufgelaufenenZinsen zurückzuzahlen, falls der Gesamtnennbetragder ausstehenden Schuldverschreibungen (einschließlichder nach § 19 ausgegebenen Schuldverschreibungen)zu irgendeinem Zeitpunkt unter 10% desGesamtnennbetrags der ursprünglich begebenen Schuldverschreibungenfällt. Die Kündigungserklärung ist unwiderruflichund muss den Tag der vorzeitigen Rückzahlungangeben.§4(Zahlungen)(1) Währung. Sämtliche Zahlungen auf die Schuldverschreibungenwerden von der Anleiheschuldnerin in Eurogeleistet.(2) Zahlungen. Zahlungen des Kapitals, der Zinsen undaller sonstigen auf die Schuldverschreibungen zahlbarenBarbeträge werden von der Anleiheschuldnerin am jeweiligenZahltag (§ 4(4)) an die Zahlstelle zur Weiterleitung anClearstream Frankfurt zur Gutschrift auf die bei ClearstreamFrankfurt geführten Konten der jeweiligen Konto-§3(Maturity; Repurchase; Early Redemption)(1) Final Maturity. The Bonds shall be redeemed at theirPrincipal Amount on December 8, 2008 (the “RedemptionDate”), together with interest accrued on the PrincipalAmount until (but excluding) the Redemption Date,unless they have previously been redeemed or convertedor purchased and cancelled.(2) Repurchase. The Issuer and/or Südzucker AGMannheim/Ochsenfurt, Mannheim, Federal Republic ofGermany (the “Guarantor”) and/or any of their affiliatesshall be entitled at any time to purchase Bonds in themarket or otherwise. Bonds so repurchased may be held,cancelled or resold.(3) Early Redemption at the Option of the Issuer. On orafter December 9, 2006, upon giving not less than 20 normore than 40 days’ notice by publication in accordancewith § 18, the Issuer may at any time redeem the Bonds inwhole, but not in part, at the Principal Amount, plusinterest accrued thereon until (but excluding) the date ofredemption, if the non-weighted arithmetic average of thestock exchange prices of the ordinary shares of theGuarantor in the final auction (Schlussauktion) in theXetra-System of Deutsche Börse AG (or a successorsystem) (such price on any day the “Xetra-Quotation”) onat least 20 of the 30 trading days of the Frankfurt StockExchange (each a “Trading Day”) immediately precedingthe publication of the redemption notice exceeds 130% ofthe then applicable Conversion Price (§ 6(1)). Theredemption notice shall be irrevocable and shall specifythe date of redemption.(4) Early Redemption at the Option of the Issuer forReasons of Minimal Outstanding Principal Amount. If atany time the aggregate Principal Amount of Bondsoutstanding (including any Bonds issued pursuant to§ 19) falls below 10% of the aggregate Principal Amountof the Bonds that were initially issued, the Issuer shall beentitled, by giving not less than 20 nor more than 40 days’notice by publication in accordance with § 18, to redeemthe remaining Bonds in whole, but not in part, at theirPrincipal Amount together with interest accrued thereonuntil (but excluding) the date of redemption. Such noticeshall be irrevocable and shall state the date of earlyredemption.§4(Payments)(1) Currency. All payments on the Bonds shall be made bythe Issuer in euro.(2) Payments. Payments of principal, interest and all othercash payments payable on the Bonds shall be made bythe Issuer on the relevant payment date (§ 4(4)) to thePaying Agent for onpayment to Clearstream Frankfurt forcredit to the accounts of the respective accountholders inClearstream Frankfurt. All payments made to Clearstream38

inhaber gezahlt. Zahlungen an Clearstream Frankfurt oderdessen Order befreien die Anleiheschuldnerin in Höhe dergeleisteten Zahlungen von ihren Verbindlichkeiten ausden Schuldverschreibungen.(3) Geschäftstage. Ist ein Tag, an dem Zahlungen auf dieSchuldverschreibungen fällig sind, kein Geschäftstag, sowird die betreffende Zahlung erst am nächstfolgendenGeschäftstag geleistet, ohne dass wegen dieser ZahlungsverschiebungZinsen zu zahlen sind. Ein „Geschäftstag“ist jeder Tag, an dem Geschäftsbanken in Frankfurt amMain für den Geschäftsverkehr geöffnet sind und Zahlungenin Euro über das Trans-european Automated RealtimeGross settlement Express Transfer system (TARGET)abgewickelt werden können.(4) Zahltag/Fälligkeitstag. Im Rahmen dieser Anleihebedingungenbedeutet „Zahltag“ der Tag, an dem dieZahlung tatsächlich erfolgen muss, gegebenenfalls nachAnpassung gemäß § 4(3), und „Fälligkeitstag“ meint denhierin vorgesehenen Zahltag ohne Berücksichtigung einersolchen Anpassung.(5) Hinterlegung bei Gericht. Die Anleiheschuldnerin kannBeträge an Kapital oder Zinsen sowie gegebenenfallsgemäß §§ 8(2) oder 10(1)(b) zu zahlenden Beträge, auf dieInhaber von Schuldverschreibungen (die „Anleihegläubiger“)(nach dem jeweiligen Fälligkeitstag) keinenAnspruch erhoben haben, bei dem Amtsgericht in Frankfurtam Main hinterlegen. Die Garantin kann dort auchetwaige, im Hinblick auf die Garantie (§ 12(1)) zu leistendeBeträge hinterlegen. Soweit die Anleiheschuldnerin oderdie Garantin auf das Recht zur Rücknahme der hinterlegtenBeträge verzichtet, erlöschen die betreffenden Ansprücheder Anleihegläubiger gegen die Anleiheschuldnerinbzw. die Garantin.§5(Steuern)Alle Zahlungen der Anleiheschuldnerin auf die Schuldverschreibungenund der Garantin auf die Garantie werdenohne Abzug oder Einbehalt gegenwärtiger oder zukünftigerSteuern, Abgaben oder amtlicher Gebühren gleichwelcher Art gezahlt, die von oder in den Niederlandenoder der Bundesrepublik Deutschland („Deutschland“)oder für deren Rechnung oder von oder für Rechnungeiner dort zur Steuererhebung ermächtigten Gebietskörperschaftoder Behörde durch Abzug oder Einbehalt ander Quelle auferlegt, erhoben oder eingezogen werden, essei denn, ein solcher Abzug oder Einbehalt ist gesetzlichvorgeschrieben. Weder die Anleiheschuldnerin noch dieGarantin sind im Hinblick auf einen solchen Abzug oderEinbehalt zu einer zusätzlichen Zahlung an die Anleihegläubigerverpflichtet.§6(Wandlungsrecht)(1) Wandlungsrecht. Die Garantin hat am 8. Dezember2003 in einer Verpflichtungserklärung zugunsten derAnleihegläubiger gegenüber der Deutsche Bank Aktiengesellschaft(die „Verpflichtungserklärung“) jedemAnleihegläubiger vorbehaltlich des § 6(5) das Recht (das„Wandlungsrecht“) gewährt, gemäß den Bestimmungendieses § 6 jederzeit während des Ausübungszeitraums(§ 6(2)) jede Schuldverschreibung ganz, nicht jedoch teilweise,in auf den Inhaber lautende Stammaktien (Stückaktienohne Nennbetrag) der Garantin mit einem auf eineAktie entfallenden anteiligen Betrag des Grundkapitalsder Garantin von 5 1,00 (die „Aktien“) zu wandeln. DerWandlungspreis je Aktie (der „Wandlungspreis“) beträgt,vorbehaltlich der Anpassung gemäß § 10 und § 16(4),5 20,53. Das Wandlungsverhältnis (das „Wandlungsverhältnis“)errechnet sich durch Division des Nennbetragsder Schuldverschreibung (5 1.000) durch den am Aus-Frankfurt or to its order shall discharge the liability of theIssuer under the Bonds to the extent of the amounts sopaid.(3) Business Days. If any due date for payments on theBonds is not a Business Day, such payment will not bemade until the immediately following Business Day, andno interest shall be paid in respect of the delay in suchpayment. A “Business Day” shall be any day on whichbanking institutions are open for business in Frankfurtam Main and payments in euro may be settled via theTrans-european Automated Real-time Gross settlementExpress Transfer system (TARGET).(4) Payment Date/Due Date. For the purposes of theseTerms and Conditions, “payment date” means the day onwhich the payment is actually to be made, whereapplicable as adjusted in accordance with § 4(3)), and“due date” means the payment date provided for herein,without taking account of such adjustment.(5) Depositing in Court. The Issuer may deposit with thelocal court (Amtsgericht) in Frankfurt am Main anyamounts of principal or interest not claimed by holders ofBonds (“Bondholders”) as well as any amounts duepursuant to §§ 8(2) or 10(1)(b), and the Guarantor maydeposit amounts due under the Guarantee (§ 12(1)), if any.To the extent that the Issuer or the Guarantor, as the casemay be, waives its right to withdraw such depositedamounts, the relevant claims of the Bondholders againstthe Issuer or the Guarantor, as the case may be, shallcease.§5(Taxes)All payments by the Issuer on the Bonds and by theGuarantor in respect of the Guarantee will be madewithout deduction or withholding of any present or futuretaxes, duties or governmental charges of any naturewhatsoever imposed, levied or collected by way ofdeduction or withholding at source by, in or on behalf ofThe Netherlands or the Federal Republic of Germany(“Germany”) or by or on behalf of any politicalsubdivision or authority thereof or therein having powerto tax, unless such deduction or withholding is requiredby law. Neither the Issuer nor the Guarantor shall berequired to make any additional payments to theBondholders in respect of such deduction or withholding.§6(Conversion Right)(1) Conversion Right. Subject to § 6(5), the Guarantor hasundertaken towards Deutsche Bank Aktiengesellschaft forthe benefit of the Bondholders in an undertaking datedDecember 8, 2003 (the “Undertaking”) to grant eachBondholder the right (the “Conversion Right”) to convertin accordance with this § 6 at any time during theConversion Period (§ 6(2)) each Bond in whole, but not inpart, into ordinary bearer shares (non-par value shares) ofthe Guarantor with a notional nominal amount of 5 1.00per share (the “Shares”). Subject to adjustment pursuantto §§ 10 and § 16(4), the conversion price per Share (the“Conversion Price”) is5 20.53. The conversion ratio (the“Conversion Ratio”) shall be calculated by dividing thePrincipal Amount of a Bond (5 1,000) by the ConversionPrice applicable on the Conversion Date (§ 7(4)). Deliveryof Shares shall be made in accordance with § 8. TheUndertaking constitutes a contract for the benefit of the39

übungstag (§ 7(4)) geltenden Wandlungspreis. Die Lieferungder Aktien erfolgt gemäß § 8. Die Verpflichtungserklärungstellt einen Vertrag zugunsten der Anleihegläubigerals begünstigte Dritte im Sinne von § 328Absatz 1 des Bürgerlichen Gesetzbuchs dar, der jedemAnleihegläubiger das Recht gewährt, die Erfüllung derdarin übernommenen Verpflichtungen unmittelbar vonder Garantin zu verlangen und diese Verpflichtungenunmittelbar gegen die Garantin durchzusetzen. Kopiender Verpflichtungserklärung werden bei der Zahlstelle zurkostenlosen Ausgabe bereitgehalten.(2) Ausübungszeitraum. Das Wandlungsrecht kann durcheinen Anleihegläubiger vom 18. Januar 2004 bis zum21. November 2008 (beide Tage einschließlich) (der „Ausübungszeitraum“)ausgeübt werden (vorbehaltlich § 6(3),(4) und (5)). Ist der letzte Tag des Ausübungszeitraumskein Geschäftstag, so endet der Ausübungszeitraum andem Geschäftstag, der diesem Tag unmittelbar vorangeht.Fällt der letzte Tag des Ausübungszeitraums in einenNichtausübungszeitraum (§ 6 (4)), so endet der Ausübungszeitraumam letzten Geschäftstag vor dem Beginndes betreffenden Nichtausübungszeitraums.(3) Vorzeitige Rückzahlung der Schuldverschreibungen.Für den Fall, dass die Schuldverschreibungen durch dieAnleiheschuldnerin gemäß § 3(3) oder (4) gekündigt werden,darf (vorbehaltlich der Regelungen des § 6 (2)) dasWandlungsrecht bis zum Ablauf des zehnten Geschäftstagesausgeübt werden, der dem Tag der vorzeitigen Rückzahlungvorausgeht; danach erlischt das Wandlungsrecht.Wenn Schuldverschreibungen gemäß § 14 oder § 16 durchAnleihegläubiger gekündigt werden, darf das Wandlungsrechtim Hinblick auf die gekündigten Schuldverschreibungennicht mehr ausgeübt werden.(4) Nichtausübungszeitraum. Die Ausübung des Wandlungsrechtsist während der nachfolgenden Zeiträume(jeweils ein „Nichtausübungszeitraum“) ausgeschlossen:(a) anlässlich von Hauptversammlungen der Garantinwährend des Zeitraums, der am dritten Geschäftstagvor dem letzten für die Hinterlegung der Aktien derGarantin bestimmten Tag beginnt und am drittenGeschäftstag nach der Hauptversammlung (jeweilsausschließlich) endet;(b) während eines Zeitraums von 14 Tagen vor dem Endedes Geschäftsjahres der Garantin;(c) während eines Zeitraums von je sieben Tagen vor undsieben Tagen nach dem Ende eines Kalenderjahres;und(d) während des Zeitraums ab dem Tag, an dem dieGarantin ein Bezugsangebot an ihre Aktionäre zumBezug von Aktien, Optionsrechten auf eigene Aktienoder Schuldverschreibungen mit Options- oder Wandlungsrechtenoder -pflichten, Gewinnschuldverschreibungenoder Genussrechte oder ein ähnliches Angebotin einem überregionalen Pflichtblatt der FrankfurterWertpapierbörse oder im Bundesanzeiger oderdurch den Bundesanzeiger in elektronischer Form veröffentlicht(wobei die erste Veröffentlichung maßgebendist), bis zum letzten Tag der für die Ausübungdes Bezugsrechts bestimmten Frist (jeweils einschließlich).(5) Bedingungen für Ausübung des Wandlungsrechts. EinAnleihegläubiger ist zur Wandlung seiner Schuldverschreibungenin Aktien nur berechtigt:(a) wenn zu irgendeinem Zeitpunkt nach dem Emissionstagdie Xetra-Notierung an wenigstens 20 Handelstageninnerhalb eines Zeitraumes von 30 aufeinanderfolgendenHandelstagen, der mit dem letzten Handelstageines Kalendervierteljahres endet, mehr als 100%Bondholders as third party beneficiaries within themeaning of § 328 subsection (1) of the German Civil Code(Bürgerliches Gesetzbuch) giving rise to the right of eachBondholder to require performance of the obligationsundertaken therein directly from the Guarantor and toenforce such obligations directly against the Guarantor.Copies of the Undertaking are available free of charge atthe Paying Agent.(2) Conversion Period. The Conversion Right may beexercised by a Bondholder during the periodcommencing on January 18, 2004 and ending onNovember 21, 2008 (both dates inclusive) (the“Conversion Period”), subject to the provisions of § 6(3),(4) and (5). If the last day of the Conversion Period falls ona day which is not a Business Day, the Conversion Periodshall terminate on the Business Day immediatelypreceding such day. If the last day of the ConversionPeriod falls in an Excluded Period (§ 6(4)), the ConversionPeriod shall terminate on the last Business Day prior to thecommencement of such Excluded Period.(3) Early Redemption of the Bonds. In the event the Bondsare declared due for redemption by the Issuer pursuant to§ 3(3) or (4), the Conversion Right may, subject to theprovisions of § 6(2), be exercised until the end of the tenthBusiness Day prior to the date of early redemption;thereafter, the Conversion Right expires. If Bonds aredeclared due for early redemption by Bondholderspursuant to §§ 14 or 16, the Conversion Right with respectto the Bonds so declared due may no longer be exercised.(4) Excluded Period. The exercise of the Conversion Rightshall be excluded during any of the following periods(each an “Excluded Period”):(a) in connection with any shareholders’ meetings of theGuarantor, a period commencing three Business Daysprior to the last day for deposit of shares of theGuarantor and ending on the third Business Dayfollowing such shareholders’ meeting (both datesexclusive);(b) a period of 14 days before the end of the fiscal year ofthe Guarantor;(c) a period of seven days before and seven days after theend of any calendar year; and(d) a period commencing on the date on which an offer bythe Guarantor to its shareholders by way of a rightsoffering to subscribe to shares, warrants on ownshares or bonds with option or conversion rights orobligations, profit-linked bonds or profit participationrights or any similar offer is published in a mandatorynewspaper (Pflichtblatt) of the Frankfurt StockExchange or in the German Federal Gazette(Bundesanzeiger) or by the German Federal Gazettevia electronic information, whatever is earlier, andending on the last day of the subscription period(both dates inclusive).(5) Conditions for Exercise of Conversion Right. ABondholder may convert its Bonds into Shares only:(a) if at any time after the Issue Date, the Xetra-Quotationon at least 20 Trading Days in a period of 30consecutive Trading Days ending on the last TradingDay of any calendar quarter exceeds 100% of theConversion Price applicable on the last Trading Day of40

des am letzten Handelstag dieses Kalendervierteljahresgeltenden Wandlungspreises beträgt; bei derBestimmung des geltenden Wandlungspreises sindfür Zwecke dieses § 6(5)(a) Anpassungen gemäߧ 10(1)(c) vorzunehmen, auch wenn die Garantin sichentschieden haben sollte, Bezugsrechte gemäߧ 10(1)(a) zu gewähren oder eine Ausgleichszahlunggemäß § 10(1)(b) zu leisten; oder(b) wenn die Xetra-Notierung an irgendeinem Handelstagam oder nach dem 8. September 2008 mehr als 100%des dann geltenden Wandlungspreises beträgt; oder(c) innerhalb eines Zeitraumes von fünf Geschäftstagennach einem Zeitraum von fünf aufeinanderfolgendenHandelstagen, in dem der Handelskurs je Schuldverschreibung(der dem Durchschnitt der Mittelwerte derBrief- und Geldkurse wie bei Bloomberg auf der SeiteDBCB zum Zeitpunkt der Xetra-Notierung notiert entspricht)an jedem Handelstag dieses Zeitraums wenigerals 97,5% des Produkts der Xetra-Notierung andem betreffenden Handelstag multipliziert mit demdann geltenden Wandlungsverhältnis beträgt; oder(d) wenn die Anleiheschuldnerin die Schuldverschreibungenzur vorzeitigen Rückzahlung gemäß § 3(3) oder (4)gekündigt hat; oder(e) wenn eine Verschmelzung (§ 2 Umwandlungsgesetz)(ausgenommen Verschmelzungen mit unmittelbarund/oder mittelbar verbundenen Tochterunternehmender Garantin im Sinne der §§ 15 bis 18 Aktiengesetz)oder eine andere Reorganisation (wie Gegenstand derRegelung in § 10(5)) wirksam wird, vorausgesetzt,dass (i), sofern die Garantin im Fall einer Verschmelzungübernehmender Rechtsträger ist, die Verschmelzungeine Kapitalerhöhung um mehr als 33,3% desdann aktuellen Grundkapitals der Garantin zur Folgehat, und (ii), sofern Gegenstand einer solchen Reorganisationeine Abspaltung ist, diese Abspaltung zueiner Herabsetzung des dann aktuellen Grundkapitalsder Garantin um mehr als 10% führt; oder(f) wenn eine ¾nderung der Kontrolle und der Stichtaggemäß § 16(1) bekannt gemacht worden sind; oder(g) wenn ein Bezugsrechtsangebot an alle Aktionäre derGarantin, das zum Bezug von Aktien zu einem unter70% des nicht gewichteten arithmetischen Durchschnittsder Xetra-Notierungen an den 20 dem Veröffentlichungsdatumfür das Bezugsrechtsangebotunmittelbar vorangehenden Handelstagen liegendenPreis berechtigt, in einem überregionalen Pflichtblatteiner der deutschen Wertpapierbörsen, an denen dieAktien zum Handel zugelassen sind, oder im Bundesanzeigeroder durch den Bundesanzeiger in elektronischerForm veröffentlicht wird, wobei die erste Veröffentlichungmaßgebend ist.Die Anleiheschuldnerin oder die Garantin wird jedes derunter (e) bis (g) genannten Ereignisse ohne schuldhaftesZögern gemäß § 18 bekannt machen (es sei denn, dasWandlungsrecht kann dann bereits in Folge des vorherigenEintritts eines der unter (a) bis (d) genannten Ereignissesausgeübt werden). Bei Eintritt des unter (f) genanntenEreignisses kann das Wandlungsrecht jederzeit ab demDatum der Bekanntmachung gemäß § 16(1)(a) bis zumund einschließlich des Stichtags (§ 16(1)(b)), und bei Eintrittdes unter (g) genannten Ereignisses kann das Wandlungsrechtwährend der zehn dem Ablauf der Bezugsfristunmittelbar folgenden Geschäftstage ausgeübt werden.Hinsichtlich irgendeines anderen in (a) bis (e) beschriebenenEreignisses kann das Wandlungsrecht unmittelbarnach Eintritt des Ereignisses ausgeübt werden.such calendar quarter; when determining theapplicable Conversion Price, for purposes of this§ 6(5)(a) adjustments pursuant to § 10(1)(c) shall bemade, even though the Guarantor may have electedto grant subscription rights pursuant to § 10(1)(a) or tomake a compensation payment pursuant to § 10(1)(b);or(b) if the Xetra-Quotation on any Trading Day on or afterSeptember 8, 2008 exceeds 100% of the thenapplicable Conversion Price; or(c) during the five Business Day period after any fiveconsecutive Trading Day period in which the tradingprice per Bond (which is the average of the midpointsof the bid/ask quotes quoted on Bloomberg underpage DBCB at the time of the Xetra-Quotation) foreach Trading Day of that period was less than 97.5 % ofthe product of the Xetra-Quotation on such TradingDay and the then applicable Conversion Ratio; or(d) if the Bonds have been called for early redemption bythe Issuer pursuant to § 3(3) or (4); or(e) if a merger (§ 2 German Transformation Act(Umwandlungsgesetz); Verschmelzung) (except formergers with direct and/or indirect affiliatedsubsidiaries of the Guarantor within the meaning of§§ 15 to 18 German Stock Corporation Act(Aktiengesetz)) or other reorganization (as referred toin § 10(5)) becomes effective, provided that (i) in casesuch merger involves the Guarantor as assumingentity (übernehmender Rechtsträger), such mergerresults in a capital increase of more than 33.3% of thethen current share capital of the Guarantor and (ii) incase such reorganization involves a spin-off(Abspaltung), such spin-off leads to a decrease ofmore than 10% of the then current share capital of theGuarantor; or(f) if a Change of Control and the Effective Date havebeen published pursuant to § 16(1); or(g) if an offer to all shareholders of the Guarantor of rightsentitling them to purchase Shares at less than 70% ofthe non-weighted arithmetic average of the Xetra-Quotations for the 20 Trading Days immediatelypreceding the date of publication for such offer ispublished in a mandatory supraregional newspaperof one of the German stock exchanges where theShares are admitted for trading, or in the GermanFederal Gazette (Bundesanzeiger) or by the GermanFederal Gazette via electronic information, whicheveris earlier.The Issuer or the Guarantor shall publish any of the eventsdescribed under (e) through (g) without undue delay inaccordance with § 18 (unless the Conversion Right is thenalready exercisable upon the earlier occurrence of any ofthe events described under (a) through (d)). Upon theoccurrence of the event described under (f), theConversion Right may be exercised at any time after thepublication pursuant to § 16(1)(a) until and including theEffective Date (§ 16(1)(b)), and upon the occurrence of theevent described under (g), the Conversion Right may beexercised for the ten Business Days immediatelyfollowing the end of the subscription period. With respectto any of the other events described in (a) through (e), theConversion Right may be exercised immediately upon theoccurrence of the event.41

§7(Ausübung des Wandlungsrechts)(1) Ausübungserklärung. Zur Ausübung des Wandlungsrechtsmuss ein Anleihegläubiger während des Ausübungszeitraumsauf eigene Kosten während der üblichenGeschäftszeiten an einem Geschäftstag an die Wandlungsstelleeine ordnungsgemäß ausgefüllte und unterzeichneteErklärung (die „Ausübungserklärung“) unter Verwendungeines zu diesem Zeitpunkt gültigen Vordrucks, derbei der Wandlungsstelle erhältlich ist, einreichen. Die Ausübungserklärungist unwiderruflich. Die Ausübungserklärunghat mindestens die folgenden Angaben zu enthalten:– Name und Anschrift der ausübenden Person;– die Zahl der Schuldverschreibungen, für die dasWandlungsrecht ausgeübt werden soll;– eine Erklärung, dass der Zugehörige Darlehensanspruch(§ 11(2)) an die Garantin übertragen wird;– die Bezeichnung des Wertpapierdepots des Anleihegläubigersbei einem Euroclear- oder Clearstream-Teilnehmer oder einem Kontoinhaber bei ClearstreamFrankfurt, auf das die Aktien geliefert werden sollen;– die Bezeichnung eines auf Euro lautenden Kontos desAnleihegläubigers bei einem Euroclear- oder Clearstream-Teilnehmeroder einem Kontoinhaber beiClearstream Frankfurt, auf welches etwaige Zahlungengemäß §§ 8(2) oder 10(1)(b) geleistet werden sollen;– die ordnungsgemäße Ermächtigung zur Abgabe der in§ 7(2) genannten Bezugserklärung; und– etwaige in der Ausübungserklärung geforderte Bestätigungenund Verpflichtungserklärungen im Hinblickauf bestimmte Beschränkungen der Inhaberschaft derSchuldverschreibungen und/oder der Aktien.(2) Weitere Voraussetzungen für die Ausübung des Wandlungsrechts.Die Ausübung des Wandlungsrechts setztaußerdem voraus, dass die Schuldverschreibungen, fürdie das Wandlungsrecht ausgeübt werden soll, an dieWandlungsstelle geliefert werden, und zwar durch Lieferung(Umbuchung) der Schuldverschreibungen auf dasKonto der Wandlungsstelle bei Clearstream Frankfurt. DieWandlungsstelle ist ermächtigt, die Bezugserklärunggemäß § 198 Absatz 1 des Aktiengesetzes für den Anleihegläubigerabzugeben. Die Wandlungsstelle ist von denBeschränkungen des § 181 des Bürgerlichen Gesetzbuchsbefreit.(3) Prüfung der Ausübungserklärung. Nach Erfüllungsämtlicher in den § 7(1) und (2) genannten Voraussetzungenfür die Ausübung des Wandlungsrechts prüft dieWandlungsstelle, ob die Zahl der an die Wandlungsstellegelieferten Schuldverschreibungen der in der Ausübungserklärungangegebenen Zahl an Schuldverschreibungenentspricht. Soweit die in der Ausübungserklärung angegebeneZahl an Schuldverschreibungen die Zahl der tatsächlichgelieferten Schuldverschreibungen über- oder unterschreitet,wird die Wandlungsstelle, je nachdem welcheZahl niedriger ist, entweder (i) die Gesamtzahl von Aktien,die der in der jeweiligen Ausübungserklärung angegebenenZahl von Schuldverschreibungen entspricht, oder (ii)die Gesamtzahl von Aktien, die der Zahl der tatsächlichgelieferten Schuldverschreibungen entspricht, von derGarantin beziehen und an den Anleihegläubiger liefern.Verbleibende Schuldverschreibungen werden an denAnleihegläubiger zurückgeliefert.(4) Ausübungstag. Das Wandlungsrecht ist an dem Geschäftstagwirksam ausgeübt, an dem sämtliche in § 7(1)und (2) genannten Voraussetzungen für die Ausübungdes Wandlungsrechts erfüllt sind (der „Ausübungstag“).Für den Fall, dass die in § 7 (1) und (2) genannten Voraus-§7(Exercise of Conversion Right)(1) Conversion Notice. To exercise the Conversion Right,the Bondholder must deliver to the Conversion Agent atits own expense during normal business hours on aBusiness Day during the Conversion Period a dulycompleted and signed notice (the “Conversion Notice”)using a form (as amended from time to time) availablefrom the Conversion Agent. Conversion Notices shall beirrevocable. The Conversion Notice shall, among otherthings:– state the name and address of the exercising person;– specify the number of Bonds with respect to which theConversion Right shall be exercised;– contain a declaration that the Appertaining Claim(§ 11(2)) shall be transferred to the Guarantor;– designate the securities deposit account of theBondholder at a Euroclear or Clearstream participantor at a Clearstream Frankfurt accountholder to whichthe Shares are to be delivered;– designate a Euro-account of the Bondholder at aEuroclear or Clearstream participant or at aClearstream Frankfurt accountholder to which anypayments pursuant to §§ 8(2) or 10(1)(b), if any, are tobe made;– contain the granting of due authority to deliver thesubscription certificate referred to in § 7(2); and– contain the certifications and undertakings set out inthe form of the Conversion Notice relating to certainrestrictions of the ownership of the Bonds and/or theShares.(2) Further Requirements for Exercise of Conversion Right.The exercise of the Conversion Right shall further requirethat the Bonds to be converted be delivered to theConversion Agent by transferring (book-entry transfer)the Bonds to the Clearstream Frankfurt account of theConversion Agent. The Conversion Agent shall beauthorized to deliver the subscription certificate pursuantto § 198 subsection (1) of the German Stock CorporationAct (Aktiengesetz) on behalf of the Bondholder. TheConversion Agent is exempt from the restrictions of § 181German Civil Code (Bürgerliches Gesetzbuch).(3) Review of Conversion Notice. Upon fulfillment of allrequirements specified in § 7(1) and (2) for the exercise ofthe Conversion Right, the Conversion Agent will verifywhether the number of Bonds delivered to theConversion Agent is identical to the number of Bondsspecified in the Conversion Notice. In the event of anyexcess or shortfall, the Conversion Agent shall subscribefrom the Guarantor and deliver to the Bondholder thelower of (i) such total number of Shares whichcorresponds to the number of Bonds set forth in theConversion Notice, or (ii) such total number of Shareswhich corresponds to the number of Bonds in factdelivered. Any remaining Bonds will be redelivered to theBondholder.(4) Conversion Date. The Conversion Right shall be validlyexercised on the Business Day on which all of theconditions precedent specified in § 7(1) and (2) for theexercise of the Conversion Right have been fulfilled (the“Conversion Date”). In the event that the conditions42

setzungen an einem Tag erfüllt sind, der in einen Nichtausübungszeitraumfällt, ist der Ausübungstag der ersteGeschäftstag nach dem Ende dieses Nichtausübungszeitraums,soweit auch dieser Tag noch in den Ausübungszeitraumfällt; anderenfalls ist das Wandlungsrecht nichtwirksam ausgeübt.§8(Lieferung der Aktien; Ausgleich von Bruchteilenvon Aktien)(1) Lieferung der Aktien; Bruchteile von Aktien. Nach Ausübungdes Wandlungsrechts werden ausschließlich ganzeAktien geliefert. Ein Anspruch auf Lieferung von Bruchteilenvon Aktien besteht nicht. Soweit die Wandlungsstellefestgestellt hat (ohne dazu verpflichtet zu sein), dass fürdenselben Anleihegläubiger mehrere Schuldverschreibungenzur gleichen Zeit gewandelt wurden und soweitsich für eine oder mehrere Schuldverschreibungen bei derDurchführung der Wandlung Bruchteile von Aktien ergeben,werden alle sich ergebenden Bruchteile von Aktienaddiert und die sich infolge der Addition der Bruchteileetwa ergebenden ganzen Aktien an den betreffendenAnleihegläubiger geliefert. Die zu liefernden Aktien werdennach Durchführung der Wandlung alsbald, jedochnicht später als zehn Geschäftstage nach dem Ausübungstagauf das von dem betreffenden Anleihegläubiger in derAusübungserklärung angegebene Wertpapierdepot geliefert.(2) Verbleibende Bruchteile von Aktien. VerbleibendeBruchteile von Aktien werden nicht geliefert, sondern inGeld ausgeglichen, wobei ein dem verbleibenden Bruchteilentsprechender Bruchteil des volumen-gewichtetenarithmetischen Durchschnitts der Xetra-Notierungen anden zehn aufeinander folgenden Handelstagen unmittelbarvor dem Ausübungstag, abgerundet auf den nächstenCent, gezahlt wird.(3) Zahlung. Ein etwaiger Ausgleich in Geld für Bruchteilevon Aktien gemäß § 8(2) erfolgt alsbald nach dem Ausübungstagdurch Zahlung gemäß § 4(2). Auf diesenBetrag werden keine Zinsen geschuldet.(4) Steuern. Lieferung der Aktien gemäß § 8(1) und Zahlungengemäß § 8(3) setzen voraus, dass der Anleihegläubigeretwaige Steuern, Abgaben oder amtlicheGebühren zahlt, die im Zusammenhang mit der Ausübungdes Wandlungsrechts oder der Lieferung derAktien gemäß § 8(1) oder im Zusammenhang mit Zahlungender Garantin gemäß § 8(3) anfallen. Steuern, Abgabenund amtliche Gebühren können von einer etwaigenZahlung gemäß § 8(3) abgezogen werden, sofern derAnleihegläubiger solche Steuern oder Abgaben nichtzuvor gezahlt hat.(5) Wandlungspreis unter dem auf die einzelne Aktie entfallendenanteiligen Betrag des Grundkapitals. Soweitnach Auffassung der Garantin irgendeine Zahlung gemäߧ§ 8(2) oder 10(1)(b) als Ermäßigung des Wandlungspreisesanzusehen ist, erfolgt keine Zahlung, soweit dadurchder Wandlungspreis für eine Aktie unter den auf eine einzelneAktie entfallenden anteiligen Betrag des Grundkapitalsder Garantin herabgesetzt würde.precedent specified in § 7(1) and (2) are fulfilled on a daywhich falls within an Excluded Period, then theConversion Date shall be the first Business Day after theend of such Excluded Period provided that such day stillfalls within the Conversion Period; otherwise, theConversion Right shall not have been validly exercised.§8(Delivery of Shares; Compensation for Fractions ofShares)(1) Delivery of Shares; Fractions of Shares. Upon anyexercise of the Conversion Right only full Shares shall bedelivered. Fractions of Shares may not be claimed. To theextent that the Conversion Agent has ascertained (withoutany obligation to do so) that several Bonds have beenconverted at the same time for the same Bondholder andto the extent that any conversion of Bonds results infractions of Shares, the fractions of Shares resulting fromthe conversion of a Bond shall be aggregated and fullShares resulting from such aggregation of fractions ofShares shall be delivered to the relevant Bondholder. TheShares to be delivered shall be transferred as soon aspracticable, but not later than ten Business Days after theConversion Date to the securities deposit account of theBondholder designated in the Conversion Notice.(2) Remaining Fractions of Shares. Remaining fractions ofShares shall not be delivered and shall be compensated incash proportional to the respective fraction of the volumeweightedarithmetic average of the Xetra-Quotations onthe ten consecutive Trading Days immediately precedingthe Conversion Date, rounded down to the nearest fullcent.(3) Payment. Any compensation in cash of fractions ofShares pursuant to § 8(2) shall be effected as soon aspracticable after the Conversion Date by payment pursuantto § 4(2). No interest shall be due on such amount.(4) Taxes. Delivery of Shares pursuant to § 8(1) and anypayment pursuant to § 8(3) are subject to payment by aBondholder of any taxes, duties or governmental chargeswhich may be imposed in connection with the exercise ofthe Conversion Right or the delivery of the Sharespursuant to § 8(1) or any payment of any amountpursuant to § 8(3). Taxes, duties and governmentalcharges may be set off against a payment obligationpursuant to § 8(3), unless the Bondholder has paid suchtaxes or duties before.(5) Conversion Price below Notional Nominal Amount perShare. To the extent that any payment pursuant to §§ 8(2)or 10(1)(b) is in the opinion of the Guarantor considered tobe a reduction of the Conversion Price, no payment shallbe made to the extent that the Conversion Price for oneShare would thereby be reduced below the notionalnominal amount per Share.§9(Bereitstellung von Aktien; Dividenden)(1) Bedingtes Kapital; Bereitstellung von Aktien. Die Aktienwerden nach Durchführung der Wandlung aus einemgemäß Beschluss der Hauptversammlung der Garantinvom 31. Juli 2003 geschaffenen bedingten Kapital von insgesamt5 13.000.000 oder von dritten Parteien stammen.Die Garantin ist nach ihrem eigenen Ermessen berechtigt,statt junger Aktien aus dem bedingten Kapital bestehende§9(Procurement of Shares; Dividends)(1) Conditional Capital; Procurement of Shares. Uponexecution of the conversion, the Shares will derive from aconditional capital of the Guarantor in the amount of5 13,000,000 created by resolution of its shareholders’meeting on July 31, 2003 or from third parties. TheGuarantor shall at its sole discretion be entitled to deliver(or cause to be delivered) at the Conversion Price existing43

Aktien zum Wandlungspreis an einen Anleihegläubiger zuliefern oder liefern zu lassen, vorausgesetzt, die bestehendenAktien gehören derselben Gattung wie die zu lieferndenjungen Aktien an, die Lieferung der bestehendenAktien kann rechtswirksam erfolgen und beeinträchtigtnicht die Rechte des Anleihegläubigers im Vergleich zurLieferung junger Aktien. Eine unterschiedliche Dividendenberechtigung(die bei den bestehenden Aktien nicht geringersein darf als bei den jungen Aktien, die andernfalls anden betreffenden Anleihegläubiger zu liefern wären) stehtder Lieferung bestehender Aktien nicht entgegen.(2) Dividenden. Aktien, die aufgrund der Durchführung derWandlung ausgegeben werden, sind vom Beginn desGeschäftsjahres der Garantin an, in dem die Aktien ausgegebenwerden, für dieses und alle folgenden Geschäftsjahreder Garantin gewinnanteilberechtigt.Shares to any Bondholder instead of the delivery of newShares out of conditional capital, provided that suchexisting Shares shall be of the same class as the Sharesotherwise to be delivered except for a different dividendentitlement (which shall be no less than the dividendentitlement of the new Shares that would have otherwisebeen delivered to the relevant Bondholder) and that suchdelivery of existing Shares can be legally effected anddoes not impair the rights of the relevant Bondholder itwould otherwise have.(2) Dividends. Shares issued pursuant to the execution ofthe conversion shall be entitled to dividends for the thencurrent and all following business years as from thebeginning of the business year of the Guarantor in whichsuch Shares are issued.§10(Verwässerungsschutz)(1) Bezugsrecht für Aktionäre.(a) Wenn die Garantin unter Gewährung eines Bezugsrechtsan ihre Aktionäre gemäß § 186 Aktiengesetz (i)ihr Grundkapital durch Ausgabe neuer Aktien gegenEinlagen erhöht, oder (ii) weitere Schuldverschreibungenmit Options- oder Wandlungsrechten oder Wandlungspflichten,Gewinnschuldverschreibungen oderGenussrechte begibt oder garantiert bzw. sonstigeOptionsrechte auf eigene Aktien gewährt, ist jedemAnleihegläubiger, der zu Beginn des entsprechendenNichtausübungszeitraums sein Wandlungsrecht nochnicht wirksam ausgeübt hat, vorbehaltlich der Bestimmungendes § 10(1)(b) und (c), ein Bezugsrecht in demUmfang einzuräumen, wie es ihm zustünde, wenneine Ausübung des Wandlungsrechts an demGeschäftstag unmittelbar vor dem Ex-Tag erfolgtwäre. „Ex-Tag“ im Sinne dieses § 10(1) ist der ersteHandelstag an der Frankfurter Wertpapierbörse, andem die Aktien der Garantin „ex Bezugsrecht“ im Hinblickauf den Bezug der neuen Aktien, Schuldverschreibungenmit Options- oder Wandlungsrechtenoder Wandlungspflichten, Gewinnschuldverschreibungen,Genussscheine bzw. sonstigen Optionsrechteauf eigene Aktien gehandelt werden.(b) Nach freiem Ermessen der Garantin kann an jedenAnleihegläubiger, der zu Beginn des entsprechendenNichtausübungszeitraums sein Wandlungsrecht nochnicht ausgeübt hat, anstelle der Einräumung einesBezugsrechts eine Ausgleichszahlung (der „Bezugsrechtsausgleichsbetrag“)geleistet werden, die jeSchuldverschreibung dem Bezugsrechtswert (wienachstehend definiert), multipliziert mit dem dannanwendbaren Wandlungsverhältnis, entspricht. DerBezugsrechtsausgleichsbetrag wird auf den nächstenCent aufgerundet und wird erst bei Ausübung desWandlungsrechts fällig und zahlbar. § 8(3) und (4) geltenentsprechend.(c) Anstelle der Einräumung eines Bezugsrechts oder derZahlung eines Bezugsrechtsausgleichsbetrags kannnach freiem Ermessen der Garantin eine Anpassungdes Wandlungspreises gemäß der nachstehenden Formelerfolgen:CP n ¼ CP o x SP o VSRSPDabei isto„CP n “ der neue Wandlungspreis,„CP o “ der unmittelbar vor Schluss des Börsenhandelsan der Frankfurter Wertpapierbörse am Bezugsstichtaggültige Wandlungspreis,§10(Dilution Adjustment)(1) Preemptive Rights for Shareholders.(a) If the Guarantor, subject to preemptive rights of itsshareholders pursuant to § 186 German StockCorporation Act (Aktiengesetz), (i) increases its sharecapital by issuing new shares against capitalcontributions; or (ii) issues or guarantees furtherbonds with option or conversion rights or conversionobligations, profit-linked bonds or profit participationcertificates or grants other warrants on own shares,each Bondholder, who at the beginning of the relevantExcluded Period has not yet exercised its ConversionRight, shall, subject to the provisions of § 10(1)(b) and(c), be granted a preemptive right equal to the right hewould have been entitled to had the Conversion Rightbeen exercised on the Business Day immediatelypreceding the Ex-Date. “Ex-Date” in this § 10(1) shallmean the first trading day on the Frankfurt StockExchange on which the shares of the Guarantor aretraded “ex right” with respect to the subscription ofthe new shares, bonds with option or conversionrights or conversion obligations, profit-linked bondsor profit participation certificates or other warrants onown shares.(b) Instead of being granted a preemptive right, eachBondholder who at the beginning of the relevantExcluded Period has not yet exercised its ConversionRight shall, at the Guarantor’s discretion, receive perBond payment of a cash compensation (the“Subscription Rights Compensation Amount”)corresponding to the Value of the Subscription Right(defined below) multiplied by the then applicableConversion Ratio. The Subscription RightsCompensation Amount shall be rounded up to thenearest Cent and shall become due and payable uponexercise of the Conversion Right. § 8(3) and (4) applymutatis mutandis.(c) Instead of granting a preemptive right or the paymentof a Subscription Rights Compensation Amount, theConversion Price may be adjusted at the Guarantor’sdiscretion in accordance with the following formula:CP n ¼ CP o x SP o VSRSPwhere:o“CP n ” is the new Conversion Price,“CP o ” is the Conversion Price in effect immediatelyprior to the close of trading on the Frankfurt StockExchange on the Subscription Record Date,44

„SP o “ die Xetra-Notierung am Bezugsstichtag,„Bezugsstichtag“ der Handelstag, der dem Ex-Tagunmittelbar vorausgeht, und„Bezugsrechtswert“ oder „VSR“ bedeutet je Aktie:(i) der Schlusskurs des Rechts zum Bezug der betreffendenWertpapiere am Ex-Tag, oder(ii) falls ein solcher Schlusskurs nicht feststellbar ist,der von der Wandlungsstelle nach billigem Ermessen(§ 317 des Bürgerlichen Gesetzbuchs) unterBerücksichtigung der am Ex-Tag bestehendenMarktlage bestimmte Wert des Bezugsrechts.In diesem Fall wird das Wandlungsverhältnis entsprechendangepasst.Anpassungen gemäß diesem § 10(1)(c) werden am Ex-Tag wirksam.(2) Kapitalerhöhung aus Gesellschaftsmitteln. Im Falleeiner Kapitalerhöhung der Garantin aus Gesellschaftsmittelnmit Ausgabe neuer Aktien wird der Wandlungspreismit dem nach der Formel errechneten Wert multipliziert:Dabei istN oN n„N o “ die Anzahl der Aktien der Garantin vor der Kapitalerhöhungaus Gesellschaftsmitteln; und„N n “ die Anzahl der Aktien der Garantin nach derKapitalerhöhung aus Gesellschaftsmitteln.Das Wandlungsverhältnis wird entsprechend angepasst.Anpassungen gemäß diesem § 10(2) werden mit Beginndes ersten Handelstages an der Frankfurter Wertpapierbörsewirksam, an dem die Stammaktien der Garantin„ex Berichtigungsaktien“ gehandelt werden.(3) ¾nderung der Zahl der Aktien ohne ¾nderung desGrundkapitals. Im Falle einer ¾nderung der Zahl der ausstehendenAktien ohne ¾nderung des Grundkapitals derGarantin (z. B. wegen Aktiensplit oder Zusammenlegungvon Aktien), gilt § 10(2) entsprechend.(4) Außerordentliche Dividende. Für den Fall, dass dieGarantin eine Außerordentliche Dividende (wie nachfolgenddefiniert) ausschüttet, wird der Wandlungspreis wienachfolgend dargestellt angepasst.„Außerordentliche Dividende“ bezeichnet den Gesamtbetrag(in Euro) einer Bar- oder Sachdividende (auch in Formeines Aktienrückkaufs, bei dem die Garantin ihren AktionärenPut-Optionen gewährt), die auf die Aktien derGarantin ausgeschüttet wird, wenn und nur soweit derGesamtbetrag einer solchen Dividende (die „AuslösendeDividende“) addiert zu dem Gesamtbetrag etwaiger andererfür dasselbe Geschäftsjahr auf die Aktien der Garantinausgeschütteter Bar- und Sachdividenden, für die nochkeine Anpassung gemäß diesem § 10(4) vorgenommenwurde (die „Vorhergehenden Dividenden“), eine Dividendenrendite(wie nachfolgend definiert) von mehr als fünfProzent ergibt. Die Außerordentliche Dividende entsprichtdem über diesen Prozentsatz hinausgehenden Betrag.Im Rahmen des vorhergehenden Absatzes bedeutet „Dividendenrendite“die Rendite, die sich jeweils durch Divisionder Auslösenden Dividende und etwaiger VorhergehenderDividenden durch die durchschnittliche Marktkapitalisierungder Garantin errechnet; die für die Berechnung“SP o ” is the Xetra-Quotation on the SubscriptionRecord Date,“Subscription Record Date” is the Trading Dayimmediately preceding the Ex-Date, and“Value of the Subscription Right” or “VSR” means ona per share basis:(i) the closing price of the right to subscribe to therelevant securities on the Ex-Date, or(ii) in the event that such closing price is not available,the value of the subscription right, as determinedby the Conversion Agent, using equitablediscretion (§ 317 German Civil Code), in the lightof the prevailing market conditions on the Ex-Date.In this case the Conversion Ratio shall be adjustedaccordingly.Adjustments pursuant to this § 10(1)(c) shall becomeeffective as of the Ex-Date.(2) Capital Increase from Company Reserves. In the eventof a capital increase of the Guarantor from companyreserves (Kapitalerhöhung aus Gesellschaftsmitteln) byissuing new shares, the Conversion Price shall bemultiplied by the value determined by the followingformula:N oN nwhere“N o ” is the number of shares of the Guarantor before theincrease of share capital from company reserves; and“N n ” is the number of shares of the Guarantor afterthe increase of share capital from company reserves.The Conversion Ratio shall be adjusted accordingly.Adjustments pursuant to this § 10(2) shall becomeeffective as of the beginning of the first Trading Day at theFrankfurt Stock Exchange on which ordinary shares of theGuarantor are quoted “ex bonus shares”.(3) Changes in the Number of Shares without Change inthe Share Capital. In the event of the number ofoutstanding shares being changed without a change inthe aggregate amount of the Guarantor’s share capital(e.g. by means of splitting or combining shares), § 10(2)shall apply mutatis mutandis.(4) Extraordinary Dividend. In the event the Guarantordistributes an Extraordinary Dividend (as defined below),the Conversion Price will be adjusted as set forth below.“Extraordinary Dividends” means the total amount (ineuro) of any dividend in cash or in kind (also in the formof a share repurchase where the Guarantor grants to itsshareholders put options) paid on the shares of theGuarantor, if and to the extent that the aggregate amountof such dividend (the “Triggering Dividend”), added to theaggregate amount of any other dividend in cash or in kindpaid on the shares of the Guarantor in respect of the samefiscal year as to which no adjustment pursuant to this§ 10(4) was previously made (the “Prior Dividends”),represents a Dividend Yield (as defined below) in excessof five percent, and the Extraordinary Dividend shall beequal to such excess amount.For purposes of the preceding paragraph, “DividendYield” means the yield obtained by dividing theTriggering Dividend and any Prior Dividends by theGuarantor’s average market capitalization; the averagemarket capitalization used to calculate such yield shall be45

dieser Rendite heranzuziehende durchschnittliche Marktkapitalisierungergibt sich aus dem nicht gewichtetenarithmetischen Durchschnitt der Produkte aus (i) derXetra-Notierung an jedem der zehn aufeinander folgendenHandelstage, die dem ersten Handelstag unmittelbarvorausgehen, an dem die Aktien der Garantin „ex“ AußerordentlicheDividende an der Frankfurter Wertpapierbörsegehandelt werden, und (ii) der Anzahl der bei Schlusseines jeden solchen Handelstages jeweils ausstehendenAktien der Garantin.Im Falle einer Zahlung einer Außerordentlichen Dividendedurch die Garantin wird der Wandlungspreis wie folgtangepasst:CP n ¼ CP o x ASP o VEDASPDabei ist:o„CP n “ der neue Wandlungspreis;„CP o “ der unmittelbar vor der Ausschüttung derAußerordentlichen Dividende geltende Wandlungspreis;„Wert der Außerordentlichen Dividende“ oder „VED“der Gesamtbetrag der Außerordentlichen Dividendedividiert durch die Gesamtzahl der Aktien der Garantin,die am ersten Handelstag, an dem die Aktien derGarantin „ex“ Außerordentliche Dividende an derFrankfurter Wertpapierbörse gehandelt werden, tatsächlichausstehen; und„ASP o “ der nicht gewichtete arithmetische Durchschnittder Xetra-Notierungen an den zehn aufeinanderfolgenden Handelstagen unmittelbar vor demersten Handelstag, an dem die Aktien der Garantin„ex“ Außerordentliche Dividende an der FrankfurterWertpapierbörse gehandelt werden (Dividendenstichtag);mit der Maßgabe, dass im Falle einer weiteren Ausschüttungeiner Bar- oder Sachdividende auf die Aktien derGarantin in Bezug auf das Geschäftsjahr, für das dieAußerordentliche Dividende gezahlt worden ist (derGesamtbetrag (in Euro) einer solchen zusätzlichen Dividendeeine „Zusätzliche Dividende“), der Wandlungspreiswie folgt angepasst wird:CP n ¼ CP o x NASP o VADNASPDabei ist:o„CP n “ der neue Wandlungspreis;„CP o “ der unmittelbar vor der Ausschüttung derZusätzlichen Dividende geltende Wandlungspreis;„Wert der Zusätzlichen Dividende“ oder „VAD“ derGesamtbetrag der Zusätzlichen Dividende dividiertdurch die Gesamtzahl der Aktien der Garantin, die amersten Handelstag, an dem die Aktien der Garantin„ex“ Zusätzliche Dividende an der Frankfurter Wertpapierbörsegehandelt werden, tatsächlich ausstehen(Dividendenstichtag); und„NASP o “ der nicht gewichtete arithmetische Durchschnittder Xetra-Notierungen an den zehn aufeinanderfolgenden Handelstagen unmittelbar vor demersten Handelstag, an dem die Aktien der Garantin„ex“ Zusätzliche Dividende an der Frankfurter Wertpapierbörsegehandelt werden (Dividendenstichtag).Das Wandlungsverhältnis wird entsprechend angepasst.Den Marktwert einer Sachausschüttung wird ein von derGarantin zu bestellender unabhängiger Sachverständigernach billigem Ermessen (§ 317 des Bürgerlichen Gesetzbuchs)festlegen.equal to the non-weighted arithmetic average of theproducts of (i) the Xetra-Quotation on each of the tenconsecutive Trading Days immediately preceding the firstTrading Day on which the shares of the Guarantor aretraded “ex” the Extraordinary Dividend on the FrankfurtStock Exchange and (ii) the number of shares of theGuarantor existing on the closing of each such relevantTrading Day.In case of payment by the Guarantor of an ExtraordinaryDividend, the Conversion Price shall be adjusted asfollows:CP n ¼ CP o x ASP o VEDASPwhereo“CP n ” means the new Conversion Price;“CP o ” means the Conversion Price applicableimmediately prior to the distribution of theExtraordinary Dividend;“Value of Extraordinary Dividend” or “VED” is thetotal amount of the Extraordinary Dividend divided bythe number of shares of the Guarantor actuallyoutstanding on the first Trading Day on which theshares of the Guarantor are traded “ex” ExtraordinaryDividend on the Frankfurt Stock Exchange; and“ASPo” is the non-weighted arithmetic average of theXetra-Quotations on the ten consecutive Trading Daysimmediately preceding the first Trading Day on whichthe ordinary shares of the Guarantor are traded “ex”Extraordinary Dividend on the Frankfurt StockExchange (dividend record date),provided that if any additional dividend in cash or in kindis paid on the shares of the Guarantor with respect to thefiscal year in respect of which the Extraordinary Dividendwas paid (the total amount (in euro) of such additionaldividend an “Additional Dividend”), the Conversion Priceshall be adjusted as follows:CP n ¼ CP o x NASP o VADNASPwhereo“CP n ” means the new Conversion Price;“CP o ” means the Conversion Price applicableimmediately prior to the distribution of the AdditionalDividend;“Value of the Additional Dividend” or “VAD” meansthe total amount of the Additional Dividend dividedby the total number of shares of the Guarantoractually outstanding on the first Trading Day on whichthe ordinary shares of the Guarantor are traded “ex”Additional Dividend on the Frankfurt Stock Exchange(dividend record date); and“NASP o ” is the non-weighted arithmetic average ofthe Xetra-Quotations on the ten consecutive TradingDays immediately preceding the first Trading Day onwhich the ordinary shares of the Guarantor are traded“ex” Additional Dividend on the Frankfurt StockExchange (dividend record date).The Conversion Ratio shall be adjusted accordingly.The market value of a distribution in kind shall bedetermined in good faith in accordance with § 317German Civil Code (Bürgerliches Gesetzbuch) by anindependent expert to be appointed by the Guarantor.46

Für Zwecke dieses § 10 werden auf Ausschüttungen entfallendeKörperschaftsteuerguthaben oder andere Steuerguthaben(etwa im Rahmen des Halbeinkünfteverfahrens)nicht berücksichtigt.(5) Umwandlung. Im Fall (i) einer Verschmelzung (§ 2Umwandlungsgesetz) mit der Garantin als übertragendemRechtsträger im Sinne des Umwandlungsgesetzes,(ii) einer Aufspaltung der Garantin (§ 123(1) Umwandlungsgesetz)oder (iii) einer Abspaltung von Vermögender Garantin (§ 123(2) Umwandlungsgesetz), jeweils vordem letzten Tag des Ausübungszeitraums oder einem früherenRückzahlungstag, steht einem Anleihegläubiger beiAusübung seines Wandlungsrechts ein Anspruch auf Lieferunggleichwertiger Wertpapiere, wie in § 23 Umwandlungsgesetzvorgesehen, zu.(6) Sonstige Ereignisse. Sollte ein sonstiges Ereignis eintreten,das sich auf die Aktien, das Wandlungsverhältnisoder den Wandlungspreis auswirkt, wird ein von derGarantin zu bestellender unabhängiger Sachverständigernach billigem Ermessen (§ 317 des Bürgerlichen Gesetzbuchs)diejenigen Anpassungen des Wandlungsverhältnissesund des Wandlungspreises vornehmen, die einemsolchen Ereignis Rechnung tragen.(7) Rundung und Lieferung. Der Wandlungspreis, der sichaufgrund einer Anpassung gemäß § 10 ergibt, wird aufdrei Dezimalstellen aufgerundet; das Wandlungsverhältnis,das sich aufgrund des so angepassten und gerundetenWandlungspreises errechnet, wird (vor einer etwaigenAddition von Aktien) auf drei Dezimalstellen abgerundet.Die sich daraus ergebende Zahl von Aktien wird gemäߧ 8(1) geliefert. Bruchteile von Aktien werden gemäߧ 8(1) zusammengefasst. Verbleibende Bruchteile vonAktien werden gemäß § 8(2) ausgeglichen.(8) Verantwortlichkeit; Bekanntmachung. Anpassungengemäß diesem § 10 werden durch die Wandlungsstellebzw. einen von der Garantin zu bestellenden unabhängigenSachverständigen vorgenommen und sind (sofernnicht ein offensichtlicher Fehler vorliegt) für alle Beteiligtenbindend. Die Wandlungsstelle ist berechtigt, den Ratvon Rechtsberatern oder anderen Fachleuten in Anspruchzu nehmen, wenn sie dies für erforderlich hält, und darfsich auf den ihr erteilten Rat verlassen. Die Anleiheschuldnerinoder die Garantin hat (i) die Einräumung einesBezugsrechts (§ 10(1)(a)) oder die Zahlung eines Bezugsrechtsausgleichsbetrags(§ 10(1)(b)) bzw. die Anpassungdes Wandlungspreises (§ 10(1)(c)); (ii) eine Anpassungwegen Kapitalerhöhung aus Gesellschaftsmitteln (§ 10(2));(iii) eine Anpassung wegen ¾nderung der Zahl der Aktienohne ¾nderung des Grundkapitals der Garantin (§ 10(3));(iv) eine Anpassung wegen Ausschüttung einer AußerordentlichenDividende (§ 10(4)); (v) eine Verschmelzung,Abspaltung oder Aufspaltung (§ 10(5)) oder (vi) eine sonstigeAnpassung (§ 10(6)) gemäß § 18 bekannt zu machen.(9) Wandlungspreis unter dem auf die einzelne Aktie entfallendenanteiligen Betrag des Grundkapitals. Anpassungennach diesem § 10 dürfen nicht zu einem Wandlungspreisführen, der niedriger ist als der auf die einzelne Aktieentfallende anteilige Betrag des Grundkapitals der Garantin.§11(Darlehensvertrag; Sicherungsabtretung)(1) Darlehensvertrag. Die Anleiheschuldnerin hat aufgrundeines zwischen ihr als Darlehensgeberin und der Garantinals Darlehensnehmerin abgeschlossenen Darlehensvertragsmit Datum vom 8. Dezember 2003 (der „Darlehensvertrag“)den gesamten Emissionserlös aus der Begebungder Schuldverschreibungen in Höhe von5 250.000.000 von der Deutsche Bank Aktiengesellschaft,dem die Schuldverschreibungen übernehmenden Kredit-For the purposes of this § 10, no account shall be taken ofany corporate tax credit or other tax credit (e. g. as part ofthe half-income system (Halbeinkünfteverfahren))inherent in any distribution.(5) Reorganizations. (a) In the event of (i) a merger (§ 2German Transformation Act (Umwandlungsgesetz);Verschmelzung) of the Guarantor as transferor entitywithin the meaning of the German Transformation Act, (ii)a split-up of the Guarantor (§ 123(1) GermanTransformation Act; Aufspaltung) or (iii) a spin-off (§ 123(2)German Transformation Act; Abspaltung), in each caseprior to the last day of the Conversion Period or an earlierdate of redemption, a Bondholder, upon exercise of hisConversion Right, shall have the right to receive equivalentsecurities as provided by § 23 German Transformation Act.(6) Other Events. If any other event occurs which affectsthe Shares, the Conversion Ratio or the Conversion Price,an independent expert appointed by the Guarantor shallmake such adjustments to the Conversion Ratio and theConversion Price as such independent expert shalldetermine in good faith in accordance with § 317 GermanCivil Code (Bürgerliches Gesetzbuch) to take account ofsuch event.(7) Rounding and Delivery. The Conversion Pricedetermined by an adjustment pursuant to § 10 shall berounded upwards to three decimal points; the ConversionRatio, calculated on the basis of the Conversion Price soadjusted and rounded, shall be rounded downwards tothree decimal points (before any aggregation of Shares).The number of Shares resulting therefrom shall bedelivered pursuant to § 8(1). Fractions of Shares shall beaggregated in accordance with § 8(1). Remaining fractionsof Shares shall be compensated pursuant to § 8(2).(8) Responsibility; Notice. Adjustments pursuant to this§ 10 shall be made by the Conversion Agent or an expertappointed by the Guarantor, as the case may be, and willbe binding on all parties involved, unless in case of anobvious mistake. The Conversion Agent may engage theadvice of any lawyers or other experts whose advice orservices may to it seem necessary and rely upon anyadvice so obtained. The Issuer or the Guarantor shall givenotice in accordance with § 18 of (i) the granting of apreemptive right (§ 10(1)(a)) or the payment of aSubscription Rights Compensation Amount (§ 10(1)(b)) orthe adjustment of the Conversion Price (§ 10(1)(c)), (ii) anyadjustment due to a capital increase from companyreserves (§ 10(2)), (iii) an adjustment due to a change inthe number of shares without change in the registeredshare capital of the Guarantor (§ 10(3)); (iv) anyadjustment due to the distribution of an ExtraordinaryDividend (§ 10(4)), (v) a merger, split-up or spin-off(§ 10(5)) or (vi) any other adjustment (§ 10(6)).(9) Conversion Price below Notional Nominal Amount perShare. Any adjustments pursuant to this § 10 may notresult in a Conversion Price that is less than the notionalnominal amount per Share.§11(Loan Agreement; Security Assignment)(1) Loan Agreement. The Issuer, pursuant to a loanagreement dated December 8, 2003 (the “LoanAgreement”) between the Issuer as lender and theGuarantor as borrower, has caused Deutsche BankAktiengesellschaft, the banking institution subscribing theBonds, to disburse the entire proceeds from the sale of theBonds in the amount of 5 250,000,000 directly to theGuarantor to fund the loan (the “Loan”). The due dates47

institut, unmittelbar an die Garantin zum Zweck der Auszahlungdes Darlehens (das „Darlehen“) abführen lassen.Die Fälligkeiten von Kapital- und Zinszahlungen auf dasDarlehen entsprechen den Fälligkeiten von Kapital- undZinszahlungen auf die Schuldverschreibungen; bei vorzeitigerRückzahlung der Schuldverschreibungen ist das Darlehenin Höhe der den vorzeitig zurückgezahlten odergekündigten Schuldverschreibungen Zugehörigen Darlehensansprüche(§ 11(2)(a)) zur vorzeitigen Rückzahlungfällig; ferner ermäßigt sich der Betrag des Darlehens inHöhe der zusammen mit Schuldverschreibungen übertragenenZugehörigen Darlehensansprüche bei Ausübungdes Wandlungsrechts durch Lieferung von Schuldverschreibungengemäß § 7(2). Die Anleiheschuldnerin unddie Garantin haben sich in dem Darlehensvertrag verpflichtet,die Bestimmungen des Darlehensvertrags nichtzu ändern oder aufzuheben und alles zu unterlassen, wasdie Rechte der Anleihegläubiger aus der Sicherungsabtretung(§ 11(2)(a)) beeinträchtigen könnte. Eine ¾nderungoder Aufhebung des Darlehensvertrags darf nur erfolgen,wenn die Rechte der Anleihegläubiger dadurch nicht beeinträchtigtwerden. Kopien des Darlehensvertrags werdenbei der Zahlstelle zur kostenlosen Ausgabe bereitgehalten.(2) Sicherungsabtretung.(a) Gemäß den Bestimmungen des Darlehensvertrags hatdie Anleiheschuldnerin ihre Ansprüche gegen dieGarantin auf Zahlung von Kapital auf das Darlehen andie Deutsche Bank Aktiengesellschaft für Rechnungder Anleihegläubiger zur Sicherheit für die Ansprücheauf Zahlung von Kapital auf die Schuldverschreibungenabgetreten (die „Sicherungsabtretung“). Dabeientfällt auf jede Schuldverschreibung ein Teilbetragdes Darlehens (der „Zugehörige Darlehensanspruch“),der sich nach folgender Formel bestimmt:Nennbetrag des DarlehensZugehöriger Darlehensanspruch ¼Zahl der SchuldverschreibungenDie Sicherungsabtretung erfolgt auflösend bedingtdurch die Rückzahlung der Schuldverschreibungen,für welche das Wandlungsrecht nicht ausgeübt wurde.Die Deutsche Bank Aktiengesellschaft ist ermächtigt,die Sicherungsabtretung für Rechnung der Anleihegläubigeranzunehmen. Die Erklärung der Sicherungsabtretungund die Annahme bedürfen nicht derBekanntmachung. Kopien des Abtretungsvertragswerden bei der Zahlstelle zur kostenlosen Ausgabebereitgehalten.(b) Der Zugehörige Darlehensanspruch ist mit der betreffendenSchuldverschreibung untrennbar verbunden.Über den Zugehörigen Darlehensanspruch kann nichtgesondert verfügt werden; insbesondere kann dieserAnspruch nicht gesondert abgetreten, verpfändet odersonst belastet werden. Bei Übertragung einer Schuldverschreibunggeht der Zugehörige Darlehensanspruchmit über, ohne dass es dafür einer ausdrücklichenrechtsgeschäftlichen Erklärung bedarf. Im Falleder Ausübung des Wandlungsrechts gehen bei Übertragungvon Schuldverschreibungen an die Garantindurch die Wandlungsstelle die Zugehörigen Darlehensansprüchemit auf die Garantin über und erlöschendamit.§12(Garantie und Negativverpflichtung der Garantin)(1) Garantie. Die Garantin hat am 8. Dezember 2003gegenüber der Deutsche Bank Aktiengesellschaft zugunstender Anleihegläubiger eine unbedingte und unwiderruflicheGarantie (die „Garantie“) für die ordnungsgemäßeund pünktliche Zahlung sämtlicher gemäß dieserfor payments of principal and interest on the Loancorrespond to the due dates for payments of principal andinterest on the Bonds; in the event of an early redemptionof Bonds the Loan is likewise subject to early repaymentin an amount equal to the Appertaining Claims (§ 11(2)(a))of the Bonds early redeemed; finally, the amount of theLoan will be reduced in an amount equal to theAppertaining Claims transferred together with Bonds ifthe Conversion Right is validly exercised by deliveringBonds pursuant to § 7(2). The Issuer and the Guarantorhave agreed in the Loan Agreement not to amend orterminate any provisions of the Loan Agreement and torefrain from anything which could impair the rights of theBondholders under the security assignment pursuant to§ 11(2). Any amendment or termination may only bemade if the rights of the Bondholders are not impairedthereby. Copies of the Loan Agreement are available freeof charge at the Paying Agent.(2) Security Assignment.(a) In accordance with the provisions of the LoanAgreement, the Issuer has assigned the claimsagainst the Guarantor for payment of principal underthe Loan Agreement to Deutsche BankAktiengesellschaft acting on account of theBondholders for purposes of securing the claims forpayment of principal on the Bonds. Upon suchassignment (the “Security Assignment”), a partialamount of the Loan (the “Appertaining Claim”) will beattributable to each Bond, such partial amount beingdetermined in accordance with the following formula:Principal Amount of the LoanAppertaining Claim ¼Number of BondsThe Security Assignment will be subject to thecondition subsequent (auflösende Bedingung) of theredemption of those Bonds in respect of which theConversion Right has not been exercised. DeutscheBank Aktiengesellschaft shall be authorized to acceptthe Security Assignment on account of theBondholders. The declarations of the SecurityAssignment and its acceptance need not bepublished. Copies of the assignment agreement areavailable free of charge from the Paying Agent.(b) The Appertaining Claim is undetachable from therelevant Bond. The Appertaining Claim cannot bedisposed of separately; in particular, the AppertainingClaim cannot be separately assigned, pledged orotherwise encumbered. Any transfer of a Bond resultsin the transfer of the Appertaining Claim without anyexplicit declaration of transfer being required. In theevent of the exercise of the Conversion Right, theAppertaining Claims shall pass to the Guarantortogether with the Bonds transferred to the Guarantorby the Conversion Agent and expire therewith.§12(Guarantee and Negative Pledge of the Guarantor)(1) Guarantee. The Guarantor on December 8, 2003 hasunconditionally and irrevocably guaranteed (the“Guarantee”) towards Deutsche Bank Aktiengesellschaftfor the benefit of the Bondholders the due and punctualpayment in accordance with these Terms and Conditions,48

Anleihebedingungen zahlbaren Beträge übernommen.Kopien der Garantie werden bei der Zahlstelle zur kostenlosenAusgabe bereitgehalten.(2) Negativverpflichtung. Darüber hinaus hat sich dieGarantin in der Garantie verpflichtet, solange bis Kapitalund Zinsen, sowie alle weiteren auf die Schuldverschreibungen(einschließlich der gemäß § 19 begebenen zusätzlichenSchuldverschreibungen) zahlbaren Beträge in vollemUmfang an die Zahlstelle gezahlt worden sind, fürandere Schuldverschreibungen oder ähnliche verbriefteSchuldtitel oder Schuldscheindarlehen oder für dafürübernommene Garantien und/oder Gewährleistungenkeine Sicherheiten durch Belastung ihres Vermögens zubestellen, ohne jeweils die Anleihegläubiger zur gleichenZeit und im gleichen Rang an solchen Sicherheiten oderan solchen anderen Sicherheiten, die von einem internationalenangesehenen unabhängigen Wirtschaftsprüferals gleichwertige Sicherheiten anerkannt werden, teilnehmenzu lassen. Die Verpflichtung nach Satz 1 dieses § 12(2)besteht jedoch nicht für eine Sicherheit, die (i) gesetzlichvorgeschrieben ist, oder (ii) im Zusammenhang mit staatlichenGenehmigungen verlangt wird.(3) Vertrag zugunsten Dritter. Die Garantie stellt einen Vertragzugunsten der Anleihegläubiger als begünstigteDritte im Sinne von § 328 Absatz 1 des BürgerlichenGesetzbuchs dar, der jedem Anleihegläubiger das Rechtgibt, die Erfüllung der darin übernommenen Verpflichtungenunmittelbar von der Garantin zu verlangen und dieseVerpflichtungen unmittelbar gegen die Garantin durchzusetzen.of any and all sums expressed to be payable hereunder.Copies of the Guarantee are available free of charge at thePaying Agent.(2) Negative Pledge. The Guarantor has furtherundertaken in the Guarantee, until such time as principaland interest as well as any other amounts payable on theBonds (including additional Bonds issued pursuant to§ 19) have been paid to the Paying Agent, that it shall notprovide any security, by encumbering any of its ownassets, for other bonds, notes, debentures or similardebt instruments or certificates of indebtedness(“Schuldscheindarlehen”) or for guarantees orindemnities in respect thereof without at the same timehaving the Bondholders share equally and rateably insuch security or such other security as shall be approvedby an independent accounting firm of internationallyrecognized standing as being equivalent security. Theundertaking pursuant to sentence 1 of this § 12(2) shallnot apply to security (i) which is mandatory according toapplicable laws, or (ii) which is required as a prerequisitefor governmental approvals.(3) Contract for the Benefit of Third Parties. The Guaranteeconstitutes a contract for the benefit of the Bondholdersas third party beneficiaries within the meaning of § 328subsection (1) of the German Civil Code (BürgerlichesGesetzbuch) giving rise to the right of each Bondholder torequire performance of the obligations undertaken thereindirectly from the Guarantor and to enforce suchobligations directly against the Guarantor.§13(Status; Negativverpflichtung der Anleiheschuldnerin)(1) Status. Die Verpflichtungen der Anleiheschuldnerinaus den Schuldverschreibungen haben mindestens gleichenRang wie alle anderen unbesicherten und nicht nachrangigenVerbindlichkeiten der Anleiheschuldnerin.(2) Negativverpflichtung. Die Anleiheschuldnerin verpflichtetsich, solange bis Kapital und Zinsen, sowie alle weiterenauf die Schuldverschreibungen (einschließlich der gemäߧ 19 begebenen zusätzlichen Schuldverschreibungen) zahlbarenBeträge in vollem Umfang an die Zahlstelle gezahltworden sind, für andere Schuldverschreibungen oder ähnlicheverbriefte Schuldtitel oder Schuldscheindarlehen oderfür dafür übernommene Garantien und/oder Gewährleistungenkeine Sicherheiten durch Belastung ihres Vermögenszu bestellen, ohne jeweils die Anleihegläubiger zurgleichen Zeit und im gleichen Rang an solchen Sicherheitenoder an solchen anderen Sicherheiten, die von einem internationalenangesehenen unabhängigen Wirtschaftsprüferals gleichwertige Sicherheiten anerkannt werden, teilnehmenzu lassen. Die Verpflichtung nach Satz 1 dieses § 13(2)besteht jedoch nicht für eine Sicherheit, (i) die gesetzlichvorgeschrieben ist, (ii) im Zusammenhang mit staatlichenGenehmigungen verlangt wird, oder (iii) die durch dieAnleiheschuldnerin an ihren gegenwärtigen oder zukünftigenAnsprüchen gegenüber der Garantin oder einer ihrerTochtergesellschaften aus der Weiterleitung des Erlösesder Anleiheschuldnerin aus dem Verkauf von Schuldverschreibungenbestellt wird, sofern die bestellte Sicherheitder Sicherung der Verpflichtungen der Anleiheschuldnerinaus den Schuldverschreibungen dient.§13(Pari Passu; Negative Pledge of the Issuer)(1) Pari Passu. The obligations of the Issuer under theBonds rank at least pari passu with all other unsecuredand unsubordinated obligations of the Issuer.(2) Negative Pledge. The Issuer undertakes, until suchtime as principal and interest as well as any otheramounts payable on the Bonds (including additionalBonds issued pursuant to § 19) have been paid to thePaying Agent, not to provide any security, byencumbering any of its own assets, for other bonds,notes, debentures or similar debt instruments orcertificates of indebtedness (“Schuldscheindarlehen”) orfor guarantees or indemnities in respect thereof withoutat the same time having the Bondholders share equallyand rateably in such security or such other security asshall be approved by an independent accounting firm ofinternationally recognized standing as being equivalentsecurity. The undertaking pursuant to sentence 1 of this§ 13(2) shall not apply to security which is (i) mandatoryaccording to applicable laws, (ii) required as aprerequisite for governmental approvals or (iii) which isprovided by the Issuer over any claims of the Issueragainst the Guarantor or any of its subsidiaries, whichclaims exist now or arise at any time in the future, as aresult of the passing on of the proceeds from the sale bythe Issuer of any bonds, provided that any such securityserves to secure obligations under such bonds of theIssuer.§14(Kündigung durch Anleihegläubiger)(1) Kündigungsrecht. Jeder Anleihegläubiger ist berechtigt,seine sämtlichen Forderungen aus den von ihmgehaltenen Schuldverschreibungen durch Abgabe einerKündigungserklärung (die „Kündigungserklärung“)§14(Termination by Bondholders)(1) Events of Default. Each Bondholder is entitled todeclare due and payable by submitting a notice oftermination (a “Termination Notice”) to the Paying Agentits entire claims arising from the Bonds held by it and49

gegenüber der Zahlstelle fällig zu stellen und Rückzahlungdes Nennbetrags zuzüglich der darauf bis zum Tag der tatsächlichenRückzahlung (ausschließlich) aufgelaufenenZinsen zu verlangen, wenn(a) die Anleiheschuldnerin oder die Garantin, gleichgültigaus welchen Gründen, innerhalb von 30 Tagen nachdem betreffenden Fälligkeitstag Kapital oder Zinsenaus den Schuldverschreibungen oder etwaige zu zahlendeBarbeträge gemäß §§ 8(2) oder 10(1)(b) nichtzahlt oder Aktien nicht liefert; oder(b) die Anleiheschuldnerin oder die Garantin eine sonstigewesentliche Verpflichtung aus den Schuldverschreibungen,insbesondere aus §§ 12 oder 13, gleichgültigaus welchen Gründen, nicht ordnungsgemäßerfüllt und die Nichterfüllung länger als 30 Tage fortdauert,nachdem die Zahlstelle hierüber eine schriftlicheMitteilung von einem Anleihegläubiger erhaltenhat; oder(c) die Anleiheschuldnerin oder die Garantin einer fälligenZahlungsverpflichtung aus anderen Kreditaufnahmen(wie unten definiert) oder aus einer Garantie oderGewährleistung für eine solche Kreditaufnahme Dritternicht erfüllt, wenn diese Nichterfüllung länger als30 Tage fortdauert, nachdem die Anleiheschuldnerinoder die Garantin hierüber von einem Anleihegläubigereine Benachrichtigung erhalten hat, oder eine solcheZahlungsverpflichtung der Anleiheschuldnerinoder der Garantin infolge des Vorliegens eines Kündigungsgrundesvorzeitig fällig wird; oder(d) die Anleiheschuldnerin oder die Garantin ihre Zahlungeneinstellt oder ihre generelle Unfähigkeit, ihrenfinanziellen Verpflichtungen nachzukommen, schriftlichbekannt gibt; oder(e) gegen die Anleiheschuldnerin oder die Garantin einInsolvenzverfahren eröffnet wird, ein solches Verfahreneingeleitet und nicht binnen 60 Tagen eingestelltwurde, oder die Anleiheschuldnerin oder die Garantindie Eröffnung eines solchen Verfahrens beantragt,oder einen Vergleich mit ihren Gläubigern generellanbietet oder durchführt; oder(f) die Anleiheschuldnerin oder die Garantin in Liquidationtritt, es sei denn, dass eine solche Liquidation imZusammenhang mit einer Verschmelzung oder eineranderen Form des Zusammenschlusses mit eineranderen Gesellschaft vorgenommen wird und dieseandere Gesellschaft, (i) im Falle der Anleiheschuldnerin,alle Verpflichtungen bezüglich der Schuldverschreibungenaus diesen Anleihebedingungen, oder(ii) im Falle der Garantin, alle Verpflichtungen aus derGarantie und der Verpflichtungserklärung übernimmt.Für Zwecke dieser Anleihebedingungen bedeutet„Kreditaufnahme“ jede Verbindlichkeit in Höhe von mindestens5 15.000.000,00 oder einem entsprechendenGegenwert in anderen Währungen, die aus Schuldverschreibungen,Schuldscheinen oder anderen Schuldurkundenoder aus Darlehensverpflichtungen herrührt.(2) Erlöschen des Kündigungsrechts. Das Kündigungsrechterlischt, falls der Kündigungsgrund vor Ausübungdes Rechts geheilt wurde.(3) Kündigungserklärung. Eine Kündigungserklärunggemäß § 14(1) hat in der Weise zu erfolgen, dass derAnleihegläubiger der Zahlstelle eine schriftliche Erklärungübergibt oder durch eingeschriebenen Brief übersendetund dabei durch eine Bescheinigung seiner Depotbanknachweist, dass er zum Zeitpunkt der Erklärung Inhaberder betreffenden Schuldverschreibungen ist. Kündigungserklärungengemäß § 14(1) sind unwiderruflich.demand payment of their Principal Amount, plus interestaccrued thereon until (but excluding) the day of actualredemption, if(a) the Issuer or the Guarantor, for any reasonwhatsoever, fails within 30 days after the relevant duedate to pay principal or interest on the Bonds or cashamounts which may have to be paid according to§§ 8(2) or 10(1)(b) or to deliver Shares; or(b) the Issuer or the Guarantor, for any reasonwhatsoever, fails to duly perform any other obligationunder the Bonds, in particular pursuant to § 12 or § 13,and such failure continues for more than 30 days afterthe Paying Agent has received notice thereof from aBondholder; or(c) the Issuer or the Guarantor fails to fulfill any paymentobligation, when due, arising from any otherBorrowing Obligation (as defined below) or from anyguarantee or indemnity for a Borrowing Obligation onthe part of a third party and such default continues formore than 30 days after notice of such default is givento the Issuer or the Guarantor by a Bondholder, or anysuch payment obligation can become dueprematurely by reason of any default of the Issuer orthe Guarantor, or(d) the Issuer or the Guarantor ceases its payments orannounces in writing its inability to meet its financialobligations generally, or(e) a court opens insolvency proceedings against theIssuer or the Guarantor, such proceedings areinstituted and have not been discharged or stayedwithin 60 days, or the Issuer or the Guarantor appliesfor or institutes such proceedings or offers or makesany arrangement for the benefit of its creditorsgenerally, or(f) the Issuer or the Guarantor enters into liquidation,unless such liquidation is to take place in connectionwith a merger, consolidation or any other form ofcombination with another company and suchcompany (i) in the case of the Issuer, assumes allobligations under the Bonds arising from these Termsand Conditions; or (ii) in case of the Guarantor,assumes all obligations arising from the Guaranteeand the Undertaking.For the purposes of these Conditions of Issue“Borrowing Obligation” means any indebtednessresulting from bonds, notes or other debt instruments orany other loan indebtedness of any amount of at least5 15,000,000 or the respective equivalent in othercurrencies.(2) Cessation of Termination Right. The Bondholders’right to declare the Bonds due and payable will cease inthe event that the event of default has been remediedprior to the exercise of the termination right.(3) Notice. Any Termination Notice pursuant to § 14(1)shall be made by means of a written notice to bedelivered by hand or registered mail to the Paying Agenttogether with evidence by means of a certificate of theBondholder’s depository bank that such Bondholder atthe time of such written notice is a holder of the relevantBonds. Termination Notices pursuant to § 14(1) shall beirrevocable.50

(4) Wirksamkeit. Im Fall des § 14(1)(b) wird eine dieSchuldverschreibungen fälligstellende Kündigung erstwirksam, nachdem die Zahlstelle Kündigungserklärungenvon Anleihegläubigern erhalten haben, die zusammenSchuldverschreibungen mit einem Nennbetrag von insgesamtmindestens 10% des Nennbetrags der zu diesemZeitpunkt ausstehenden Schuldverschreibungen halten.Eine solche Kündigungserklärung wird abweichend vomvorangehenden Satz sofort wirksam, wenn zum Zeitpunktihres Zugangs einer der Kündigungsgründe gemäߧ 14(1)(a) oder (c) bis (f) vorliegt oder fortdauert.(4) Effectiveness. In the case specified in § 14(1)(b), anynotice declaring Bonds due shall, unless at the time suchnotice is received any of the events specified in § 14(1)(a)or (c) through (f) entitling Bondholders to declare theirBonds due has occurred and is continuing, becomeeffective only when the Paying Agent has received suchnotices from holders of Bonds in an aggregate nominalamount of at least one-tenth of the aggregate nominalamount of all Bonds outstanding.§15(Ersetzung der Anleiheschuldnerin; Sitzverlegung)(1) Ersetzung. Die Anleiheschuldnerin ist jederzeit berechtigt,ohne Zustimmung der Anleihegläubiger entweder dieGarantin oder eine andere Gesellschaft, deren stimmberechtigteAnteile oder sonstige Kapitalanteile unmittelbaroder mittelbar zu mehr als 90% von der Garantin gehaltenwerden, als Hauptschuldnerin für alle Verpflichtungen ausund im Zusammenhang mit den Schuldverschreibungen(nachstehend die „Neue Anleiheschuldnerin“) einzusetzen,sofern(a) die Neue Anleiheschuldnerin rechtswirksam alle Verpflichtungender Anleiheschuldnerin aus oder imZusammenhang mit den Schuldverschreibungenergebenden Zahlungsverpflichtungen in Euro ohnedie Notwendigkeit einer Einbehaltung oder einesAbzugs an der Quelle irgendwelcher Steuern, Gebührenoder Abgaben in dem Land oder Hoheitsgebiet, indem die Neue Anleiheschuldnerin ihren Sitz oder ihreGeschäftsleitung hat, erfüllt sowie die hierzu erforderlichenBeträge ohne Beschränkungen an die Hauptzahlstelletransferieren kann und sie insbesonderejede hierfür notwendige Genehmigung aller zuständigenBehörden erhalten hat; und(b) die Garantin die ordnungsgemäße Erfüllung der Verpflichtungender Neuen Anleiheschuldnerin unbedingtund unwiderruflich zugunsten der Anleihegläubigergarantiert und ihre Verpflichtungserklärung bestätigthat. Dies gilt nicht, wenn die Garantin die Neue Anleiheschuldnerinist; und(c) die Neue Anleiheschuldnerin sich verpflichtet, jedemAnleihegläubiger solche Steuern, Gebühren oderAbgaben zu erstatten, die diesem als Folge der Übernahmeder Verpflichtungen der Anleiheschuldnerindurch die Neue Anleiheschuldnerin auferlegt wurden.(2) Befreiung von Verpflichtungen. Mit Wirksamwerdender Ersetzung der Anleiheschuldnerin gemäß § 15(1) istdie Anleiheschuldnerin von allen Verpflichtungen ausoder im Zusammenhang mit den Schuldverschreibungenbefreit.(3) Bekanntmachung. Eine Ersetzung der Anleiheschuldnerinist gemäß § 18 bekannt zu machen und wird mit derBekanntmachung wirksam.(4) Bezugnahmen. Im Falle einer Ersetzung der Anleiheschuldneringilt jede Bezugnahme auf die Anleiheschuldnerinin diesen Anleihebedingungen als Bezugnahme aufdie Neue Anleiheschuldnerin. Sofern die Neue Anleiheschuldnerinihren Sitz nicht in den Niederlanden hat, trittin § 5 neben die Bezugnahme auf die Niederlande eineweitere Bezugnahme auf das Land oder Hoheitsgebiet, indem die Neue Anleiheschuldnerin ihren Sitz oder ihreGeschäftsleitung hat oder als steuerlich ansässig gilt.(5) Sitzverlegung. Eine Sitzverlegung der Anleiheschuldnerinin ein anderes Land oder Hoheitsgebiet ist nur zulässig,wenn die in § 15(1) und (3) genannten Voraussetzun-§15(Substitution of Issuer; Transfer of Domicile)(1) Substitution. The Issuer shall without the consent ofthe Bondholders be entitled at any time to substitute forthe Issuer either the Guarantor or any other company,more than 90% of the voting shares or other equityinterests of which are directly or indirectly owned by theGuarantor, as principal debtor in respect of all obligationsarising from or in connection with the Bonds (hereafterthe “Substitute Issuer”), provided that(a) the Substitute Issuer, in a manner legally effective,assumes all obligations of the Issuer arising from or inconnection with these Bonds and, after suchassumption, it is in a position to fulfill all paymentobligations arising from or in connection with theseBonds in euro without the necessity of any taxes orduties to be withheld at source in that country orsovereign territory in which the Substitute Issuer isdomiciled or in which its head office is located, and totransfer all amounts which are required therefore tothe Paying Agent without any restrictions, and that inparticular all necessary authorizations to this effect byall competent authorities have been obtained;(b) the Guarantor irrevocably and unconditionallyguarantees such obligations of the Substitute Issuerfor the benefit of the Bondholders and confirms itsUndertaking, unless the Guarantor is the SubstituteIssuer; and(c) the Substitute Issuer undertakes to reimburse anyBondholder for such taxes, fees or duties which maybe imposed upon him as a consequence of theassumption of the Issuer’s obligation by theSubstitute Issuer.(2) Release from Obligations. Upon effective substitutionof the Issuer as set forth in § 15(1), the Issuer shall bereleased from any obligation arising from or inconnection with the Bonds.(3) Publication. Any such substitution shall be publishedin accordance with § 18 and shall become effective uponsuch publication.(4) References. In the event of such substitution anyreference in these Terms and Conditions to the Issuer shallfrom then on be deemed to refer to the Substitute Issuer. Ifthe Substitute Issuer is not located in The Netherlands, afurther reference to the country or sovereign territory ofdomicile or head office of the Substitute Issuer or to thecountry or sovereign territory where the Substitute Issueris deemed to be domiciled for tax purposes shall be madein § 5 in addition to the reference to The Netherlands.(5) Transfer of Domicile. A transfer of domicile of theIssuer to another country, territory or jurisdiction shallonly be permissible if § 15(1) and (3) are complied with51

gen entsprechend erfüllt sind. § 15(4) Satz 2 gilt entsprechend.§16(¾nderung der Kontrolle; Vorzeitige Rückzahlung;Anpassung des Wandlungspreises)(1) Bekanntmachung der ¾nderung der Kontrolle. Fallseine ¾nderung der Kontrolle (wie unten beschrieben) eintritt,wird die Anleiheschuldnerin oder die Garantin:(a) unverzüglich nachdem sie Kenntnis von der ¾nderungder Kontrolle erhalten hat, diese Tatsache gemäß § 18bekannt machen; und(b) für Zwecke der § 16(2) und (4) einen Geschäftstagbestimmen (der „Stichtag“) und den Stichtag gemäߧ 18 bekannt machen. Der Stichtag darf nicht wenigerals 60 und nicht mehr als 90 Tage nach der Bekanntmachungder ¾nderung der Kontrolle gemäߧ 16(1)(a) liegen.(2) Vorzeitige Rückzahlung nach Wahl der Anleihegläubiger.Falls die Anleiheschuldnerin eine ¾nderung der Kontrollegemäß § 16(1)(a) bekannt gemacht hat, ist jederAnleihegläubiger berechtigt, mittels Abgabe einer Rückzahlungserklärung(die „Rückzahlungserklärung“) vonder Anleiheschuldnerin die Rückzahlung einzelner oderaller seiner Schuldverschreibungen, für welche das Wandlungsrechtnicht ausgeübt wurde und, die nicht zur vorzeitigenRückzahlung gekündigt wurden, zum Stichtag zumNennbetrag zuzüglich der darauf bis zum Stichtag (ausschließlich)aufgelaufenen Zinsen zu verlangen. Die Rückzahlungserklärungmuss der Zahlstelle mindestens20 Tage vor dem Stichtag zugegangen sein.(3) Rückzahlungserklärung. Eine Rückzahlungserklärunghat in der Weise zu erfolgen, dass der Anleihegläubigerder Zahlstelle eine schriftliche Erklärung übergibt oderdurch eingeschriebenen Brief übersendet und dabei durcheine Bescheinigung seiner Depotbank nachweist, dass erzum Zeitpunkt der Erklärung Inhaber der betreffendenSchuldverschreibungen ist. Rückzahlungserklärungensind unwiderruflich.(4) Anpassung des Wandlungspreises wegen ¾nderungder Kontrolle. Falls die Anleiheschuldnerin oder dieGarantin eine ¾nderung der Kontrolle gemäß § 16(1)(a)bekannt gemacht hat, und falls Anleihegläubiger nacheiner solchen Bekanntmachung bis zum Stichtag (einschließlich)ihr Wandlungsrecht ausüben, wird der Wandlungspreis(gegebenenfalls angepasst gemäß § 10) um diefolgenden Prozentsätze vermindert:accordingly. § 15(4) sentence 2 shall apply mutatismutandis.§16(Change of Control; Optional Redemption;Adjustment of Conversion Price)(1) Notice of Change of Control. In the event of a Changeof Control (as defined below), the Issuer or the Guarantorwill:(a) immediately after becoming aware of the Change ofControl, publish this fact by way of a notice pursuantto § 18; and(b) determine and publish pursuant to § 18 the effectivedate for purposes of § 16(2) and (4) (the “EffectiveDate”). The Effective Date must be a Business Day notless than 60 nor more than 90 days after publication ofthe notice regarding the Change of Control pursuantto § 16(1)(a).(2) Early Redemption at the Option of the Bondholders. Ifthe Issuer or the Guarantor has published a noticeregarding a Change of Control pursuant to § 16(1)(a), anyBondholder may, at its option, by submitting aRedemption Notice (the “Redemption Notice”), demandfrom the Issuer redemption as of the Effective Date of anyor all of its Bonds for which the Conversion Right was notexercised and which were not declared due forredemption, at the Principal Amount, plus interestaccrued thereon until (but excluding) the Effective Date.The Redemption Notice must be received by the PayingAgent no less than 20 days prior to the Effective Date.(3) Redemption Notice. Any Redemption Notice shall bemade by means of a written notice to be delivered byhand or registered mail to the Paying Agent together withevidence by means of a certificate of the Bondholder’sdepository bank that such Bondholder at the time of suchwritten notice is the holder of the relevant Bonds.Redemption Notices shall be irrevocable.(4) Adjustment of Conversion Price following Change ofControl. In the event that the Issuer or the Guarantor haspublished a notice regarding a Change of Controlpursuant to § 16(1)(a), and if, following such a publication,Bondholders exercise their Conversion Right on or priorto the Effective Date, the Conversion Price (as adjustedpursuant to § 10) shall be reduced by the percentages asset forth below:AusübungstagVom 18. Januar 2004 bis 7. Dezember 2004(jeweils einschließlich) 21,8182%Vom 8. Dezember 2004 bis 7. Dezember 2005(jeweils einschließlich) 16,3636%Vom 8. Dezember 2005 bis 7. Dezember 2006(jeweils einschließlich) 10,9091%Vom 8. Dezember 2006 bis 7. Dezember 2007(jeweils einschließlich) 5,4545%Vom 8. Dezember 2007 bis 21. November 2008(jeweils einschließlich) 0,0000%Eine Anpassung des Wandlungspreises gemäß diesem§ 16(4) darf nicht zu einem Wandlungspreis führen, derniedriger ist als der auf die einzelne Aktie entfallendeanteilige Betrag des Grundkapitals der Garantin.(5) Definitionen. Eine „¾nderung der Kontrolle“ liegt vor,wenn eine Person oder gemeinsam handelnde Personendie Kontrolle über die Garantin erlangt oder erlangen.Conversion DateFrom January 18, 2004 through December 7, 2004(both included) 21.8182%From December 8, 2004 through December 7, 2005(both included) 16.3636%From December 8, 2005 through December 7, 2006(both included) 10.9091%From December 8, 2006 through December 7, 2007(both included) 5.4545%From December 8, 2007 through November 21, 2008(both included) 0.0000%Any adjustment of the Conversion Price pursuant to this§ 16(4) may not result in a Conversion Price that is lessthan the notional nominal amount per Share.(5) Definitions. A “Change of Control” occurs if a Personor Persons acting in concert, respectively, acquires oracquire Control of the Guarantor.52

„Kontrolle“ bedeutet (i) direktes oder indirektes (im Sinnedes § 22 Wertpapierhandelsgesetz) rechtliches oder wirtschaftlichesEigentum von zusammen 50% oder mehr derStimmrechte der Garantin oder die Fähigkeit gemäß § 17Aktiengesetz, in anderer Weise die Angelegenheiten derGarantin zu bestimmen, oder (ii) im Falle eines Übernahmeangebotesfür Aktien der Garantin, Umstände, indenen (A) die Aktien, die sich bereits in der Kontrolle desBieters befinden, und die Aktien, für die bereits das Angebotangenommen wurde, zusammen 50% oder mehr derStimmrechte der Garantin gewähren und (B) zur gleichenZeit das Angebot unbedingt geworden ist, oder (iii) derVerkauf oder die Übertragung durch die Garantin alleroder im wesentlichen aller Vermögenswerte an bzw. aufeine andere Person oder Personen.Eine „Person“ bezeichnet jede natürliche Person, Gesellschaft,Vereinigung, Firma, Partnerschaft, Joint Venture,Unternehmung, Zusammenschluss, Organisation, Fonds,Staat oder staatliche Einheit, unabhängig davon, ob essich um eine selbstständige juristische Person handeltoder nicht, aber unter Ausschluss der unmittelbaren odermittelbaren Tochtergesellschaften der Anleiheschuldnerinoder der Garantin oder der Süddeutschen Zuckerrübenverwertungs-Genossenschaft.“Control” means (i) direct or indirect (within the meaningof § 22 of the German Securities Trading Act(Wertpapierhandelsgesetz)) legal or beneficial ownershipof, in the aggregate, more than 50% of the voting rights ofthe Guarantor or the ability to otherwise direct the affairsof the Guarantor within the meaning of § 17 of the StockCorporation Act, or (ii) in the event of a tender offer forshares of the Guarantor, circumstances where (A) theshares already in the control of the offeror and the shareswhich have already been tendered carry, in aggregate50% or more of the voting rights in the Guarantor and (B)at the same time the offer has become unconditional, or(iii) the disposition or transfer by the Guarantor of all orsubstantially all of its assets to another Person or otherPersons.A “Person” means an individual, company, corporation,firm, partnership, joint venture, undertaking, association,organization, trust, state or agency of a state, in each casewhether or not being a separate legal entity, but excludingdirect or indirect subsidiaries of the Issuer or theGuarantor or the Süddeutsche Zuckerrübenverwertungs-Genossenschaft.§17(Zahlstelle; Wandlungsstelle)(1) Zahlstelle. Die Anleiheschuldnerin hat Deutsche BankAG, Corporate Trust and Agent Services, Große Gallusstraße10–14, D-60272 Frankfurt am Main, zur Zahlstelle(die „Zahlstelle“) bestellt. Die Zahlstelle ist von denBeschränkungen des § 181 des Bürgerlichen Gesetzbuchsbefreit. Adressänderungen werden gemäß § 18 bekanntgemacht.(2) Wandlungsstelle. Die Garantin hat Deutsche Bank AG,Corporate Actions/Warrants, Wilhelm-Fay-Straße 31–37,D-65936 Frankfurt am Main, zur Wandlungsstelle (die„Wandlungsstelle“) bestellt. Die Wandlungsstelle ist vonden Beschränkungen des § 181 des Bürgerlichen Gesetzbuchsbefreit. Adressänderungen werden gemäß § 18bekanntgemacht.(3) Ersetzung. Die Anleiheschuldnerin und die Garantinkönnen jederzeit durch Bekanntmachung gemäß § 18 miteiner Frist von mindestens 30 Tagen eine andere Bank, dieihre Hauptniederlassung oder eine Zweigniederlassung inFrankfurt am Main unterhält, zur Zahlstelle oder Wandlungsstellebestellen. Die Zahlstelle und die Wandlungsstellekönnen jederzeit von ihrem jeweiligen Amt zurücktreten.Der Rücktritt wird jedoch nur wirksam mit derBestellung einer anderen Bank, die ihre Hauptniederlassungoder eine Zweigniederlassung in Frankfurt am Mainunterhält, zur neuen Zahlstelle bzw. Wandlungsstelledurch die Anleiheschuldnerin und die Garantin unterBekanntmachung dieser Bestellung gemäß § 18 mit einerFrist von mindestens 30 Tagen.(4) Erfüllungsgehilfen. Die Zahlstelle und die Wandlungsstellehandeln in ihrer jeweiligen Eigenschaft ausschließlichals Erfüllungsgehilfen der Anleiheschuldnerin und derGarantin und stehen in dieser Eigenschaft nicht in einemAuftrags- oder Treuhand- oder sonstigem Vertragsverhältniszu den Anleihegläubigern mit Ausnahme der in § 7(2)geregelten Durchführung der Wandlung der Schuldverschreibungen.§18(Bekanntmachungen)Alle Bekanntmachungen, welche die Schuldverschreibungenbetreffen, werden in einem überregionalen Pflichtblattder Frankfurter Wertpapierbörse veröffentlicht. Die§17(Paying Agent; Conversion Agent)(1) Paying Agent. The Issuer has appointed Deutsche BankAG, Corporate Trust and Agent Services, GrosseGallusstrasse 10–14, D-60272 Frankfurt am Main, to act aspaying agent (the “Paying Agent”). The Paying Agent isexempt from the restrictions of § 181 of the German CivilCode (Bürgerliches Gesetzbuch). Changes of address shallbe published in accordance with § 18.(2) Conversion Agent. The Guarantor has appointedDeutsche Bank AG, Corporate Actions/Warrants, Wilhelm-Fay-Strasse 31–37, D-65936 Frankfurt am Main, to act asconversion agent (the “Conversion Agent”). TheConversion Agent is exempt from the restrictions of § 181 ofthe German Civil Code (Bürgerliches Gesetzbuch). Changesof address shall be published in accordance with § 18.(3) Substitution. The Issuer and the Guarantor may at anytime, by giving not less than 30 days’ notice bypublication in accordance with § 18, appoint another bankmaintaining its head office or a branch in Frankfurt amMain as Paying Agent or Conversion Agent. The PayingAgent and the Conversion Agent may at any time resignfrom its respective office. Such resignation shall becomeeffective only upon the appointment by the Issuer and theGuarantor of a bank maintaining its head office or abranch in Frankfurt am Main as the new Paying Agentand/or Conversion Agent and the giving of not less than30 days’ notice of any such appointment by publication inaccordance with § 18.(4) Agents of the Issuer and the Guarantor. The PayingAgent and the Conversion Agent (except as provided forin § 7(2) with respect to the conversion of the Bonds) insuch capacities are acting exclusively as agents of theIssuer and the Guarantor and in such capacities do nothave any relationship of agency or trust or other contractwith the Bondholders.§18(Notices)All notices regarding the Bonds shall be published in amandatory supraregional newspaper designated by theFrankfurt Stock Exchange. It is expected that such notices53

Bekanntmachungen werden voraussichtlich in der Börsen-Zeitung erscheinen. Für das Datum und die Rechtswirksamkeitsämtlicher Bekanntmachung ist der Tag der Veröffentlichungmaßgebend (oder, falls mehrere Veröffentlichungenerfolgen, der Tag der ersten Veröffentlichung).will normally be published in the Börsen-Zeitung. Anynotice will be become effective for all purposes on thedate of publication (or, if published more than once, onthe day of the first such publication).§19(Begebung weiterer Schuldverschreibungen)Die Anleiheschuldnerin behält sich vor, von Zeit zu Zeitohne Zustimmung der Anleihegläubiger weitere Schuldverschreibungenmit gleicher Ausstattung in der Weise zubegeben, dass sie mit den Schuldverschreibungen zusammengefasstwerden, eine einheitliche Anleihe mit ihnenbilden und ihren Gesamtnennbetrag erhöhen. Der Begriff„Schuldverschreibungen“ umfasst im Falle einer solchenErhöhung auch solche zusätzlich begebenen Schuldverschreibungen.§ 10(1) findet Anwendung.§19(Issue of Additional Bonds)The Issuer reserves the right from time to time without theconsent of the Bondholders to issue additional bonds withidentical terms, so that the same shall be consolidated,form a single issue with and increase the aggregateprincipal amount of the Bonds. The term “Bonds” shall,in the event of such increase, also comprise suchadditionally issued bonds. § 10(1) shall apply.§20(Verschiedenes)(1) Anwendbares Recht. Form und Inhalt der Schuldverschreibungensowie sämtliche sich aus diesen Anleihebedingungenergebenden Rechte und Pflichten derAnleihegläubiger, der Anleiheschuldnerin, der Zahlstelleund der Wandlungsstelle bestimmen sich in jeder Hinsichtnach dem Recht der Bundesrepublik Deutschland.(2) Erfüllungsort. Erfüllungsort ist Frankfurt am Main,Deutschland.(3) Teilunwirksamkeit. Sollten einzelne Bestimmungendieser Anleihebedingungen unwirksam sein oder unwirksamwerden oder nicht durchgeführt werden können, sowird hierdurch der übrige Inhalt dieser Anleihebedingungennicht berührt. Anstelle der unwirksamen Bestimmungsoll, soweit rechtlich möglich, eine dem Sinn und Zweckdieser Anleihebedingungen zum Zeitpunkt der Begebungder Schuldverschreibungen entsprechende Regelung gelten.Unter Umständen, unter denen sich diese Anleihebedingungenals unvollständig erweisen, soll eine ergänzendeAuslegung, die dem Sinn und Zweck dieserAnleihebedingungen entspricht, unter angemessenerBerücksichtigung der berechtigten Interessen der beteiligtenParteien erfolgen.(4) Gerichtsstand. Nicht-ausschließlicher Gerichtsstand füralle Rechtsstreitigkeiten aus den in diesen Anleihebedingungengeregelten Angelegenheiten ist Frankfurt amMain. Die Anleihegläubiger können ihre Ansprüche auchvor den Gerichten der Niederlande sowie vor jedem anderenzuständigen Gericht geltend machen. Die Anleiheschuldnerinunterwirft sich hiermit der Gerichtsbarkeitaller Gerichte, die nach Maßgabe dieses Absatzes zuständigsind.(5) Zustellungsbevollmächtigte. Die Anleiheschuldnerinbestellt hiermit unwiderruflich die Südzucker AG Mannheim/Ochsenfurt,Maximilianstraße 10, D-68165 Mannheim,als Zustellungsbevollmächtigte für jegliche Rechtsstreitigkeitenund sämtliche andere Verfahren, die vordeutschen Gerichten eingeleitet werden.(6) Geltendmachung von Ansprüchen. Jeder Anleihegläubigerkann in Rechtsstreitigkeiten gegen die Anleiheschuldnerinoder die Garantin oder Rechtsstreitigkeiten,an denen der Anleihegläubiger und die Anleiheschuldnerinoder die Garantin beteiligt sind, im eigenen Namenseine Rechte aus den ihm zustehenden Schuldverschreibungengeltend machen unter Vorlage (a) einer Bescheinigungseiner Depotbank, die (i) den vollen Namen und dievolle Anschrift des Anleihegläubigers enthält, (ii) einenGesamtnennbetrag von Schuldverschreibungen angibt,§20(Miscellaneous)(1) Governing Law. The Bonds, with regard to both formand content, as well as all rights and obligations arisingfrom these Terms and Conditions for the Bondholders,the Issuer, the Paying Agent and the Conversion Agentshall in all respects be governed by German law.(2) Place of Performance. Place of performance shall beFrankfurt am Main, Germany.(3) Severability. Should any of the provisions of these Termsand Conditions be or become invalid or unenforceable inwhole or in part, the validity or the enforceability of theremaining provisions shall not in any way be affected orimpaired thereby. In this case the invalid provision shall bereplaced by a provision which, to the extent legally possible,provides for an interpretation in keeping with the meaningand the economic purposes of the Terms and Conditions atthe time of the issue of the Bonds. Under circumstances inwhich these Terms and Conditions prove to be incomplete,a supplementary interpretation in accordance with themeaning and the purposes of these Terms and Conditionsunder due considerations of the legitimate interest of theparties involved shall be applied.(4) Place of Jurisdiction. Non-exclusive place ofjurisdiction for all proceedings arising from mattersprovided for in these Terms and Conditions shall beFrankfurt am Main. The Bondholders are entitled to asserttheir claims also before courts in the Netherlands orbefore any other competent court. The Issuer herebysubmits to the jurisdiction of the courts which arecompetent pursuant to this subparagraph.(5) Agent for Service of Process. For any legal disputes orother proceedings before German courts, the Issuerhereby irrevocably appoints Südzucker AG Mannheim/Ochsenfurt, Maximilianstrasse 10, D-68165 Mannheim,Federal Republic of Germany, as authorized agent foraccepting services of process in relation to any legalproceedings initiated before a German court.(6) Enforcement. Any Bondholder may in any proceedingsagainst the Issuer or the Guarantor or to which theBondholder and the Issuer or the Guarantor are partiesprotect and enforce in its own name its rights arisingunder its Bonds by submitting the following documents:(a) a certificate issued by its Depository Bank (i) statingthe full name and address of the Bondholder, (ii)specifying an aggregate principal amount of Bondscredited on the date of such statement to suchBondholders’ securities deposit account maintained with54

die am Ausstellungstag dieser Bescheinigung dem beidieser Depotbank bestehenden Depot des Anleihegläubigersgutgeschrieben sind, und (iii) bestätigt, dass dieDepotbank Clearstream Frankfurt die Angaben gemäß (i)und (ii) schriftlich mitgeteilt hat und einen Bestätigungsvermerkvon Clearstream Frankfurt sowie des betreffendenKontoinhabers bei Clearstream Frankfurt trägt, sowie(b) einer von einem Vetretungsberechtigten von ClearstreamFrankfurt oder der Zahlstelle beglaubigten Ablichtungder Globalurkunde. Im Sinne der vorstehendenBestimmungen ist „Depotbank“ ein Bank- oder sonstigesFinanzinstitut (einschließlich Clearstream Frankfurt, ClearstreamLuxemburg und Euroclear) von allgemein anerkanntemAnsehen, das eine Genehmigung für das Wertpapier-Depotgeschäfthat und bei dem der AnleihegläubigerSchuldverschreibungen im Depot verwahren lässt.(6) Vorlegungsfrist. Die in § 801(1) Satz 1 BGB bestimmteVorlegungsfrist wird für die Schuldverschreibungen inbezug auf Kapital auf zehn Jahre verkürzt. Die Vorlegungsfristfür die Schuldverschreibungen in bezug auf Zinsenbeträgt vier Jahre und beginnt mit dem Datum, an demdie jeweilige Zinszahlung erstmals fällig und zahlbar wird.§21(Sprache)Der deutsche Wortlaut dieser Anleihebedingungen istallein rechtsverbindlich. Die englische Übersetzung istunverbindlich.such Depository Bank and (iii) confirming that theDepository Bank has given a written notice to ClearstreamFrankfurt containing the information pursuant to (i) and(ii) and bearing acknowledgement of ClearstreamFrankfurt and the relevant Clearstream Frankfurtaccountholderas well as (b) a copy of the GlobalCertificate certified by a duly authorized officer ofClearstream Frankfurt or the Paying Agent as being a truecopy. For purposes of the foregoing, “Depository Bank”means any bank or other financial institution ofrecognized standing authorized to engage in securitiesdeposit business with which the Bondholder maintains asecurities deposit account in respect of any Bonds, andincludes Clearstream Frankfurt, Clearstream Luxembourgand Euroclear.(7) Term for presentation. The term for presentation of theBonds with respect to the principal as set forth in § 801(1)sentence 1 of the German Civil Code (BürgerlichesGesetzbuch) shall be reduced to ten years. The term forpresentation of the Bonds with respect to interest shall befour years after the date on which payment thereof firstbecomes due and payable.§21(Language)The German text of these Terms and Conditions is theonly legally binding one. This English translaation is forconvenience only55

GARANTIESüdzucker AG Mannheim/OchsenfurtMannheim, Bundesrepublik DeutschlandAn die Deutsche Bank Aktiengesellschaft zugunsten derAnleihegläubiger derSüdzucker International Finance B.V.7 250.000.0003,00% Schuldverschreibungen von 2003/2008mit Wandlungsrecht in auf den Inhaber lautendeStammaktien ohne Nennbetrag derSüdzucker AG Mannheim/Ochsenfurtunbedingt und unwiderruflich garantiert durch dieSüdzucker AG Mannheim/Ochsenfurt(1) Die Südzucker AG Mannheim/Ochsenfurt (die „Garantin“),übernimmt hiermit gegenüber der Deutsche BankAktiengesellschaft, Frankfurt am Main („Deutsche Bank“),zugunsten der Anleihegläubiger die unbedingte undunwiderrufliche Garantie (die „Garantie“) für die ordnungsgemäßeund pünktliche Zahlung sämtlicher von derSüdzucker International Finance B.V., Oud-Beijerland, Niederlande(die „Anleiheschuldnerin“), gemäß den Bedingungender Schuldverschreibungen (die „Anleihebedingungen“)zahlbaren Beträge.(2) Sinn und Zweck dieser Garantie ist es, sicherzustellen,dass die Anleihegläubiger unter allen Umständen undungeachtet der tatsächlichen oder rechtlichen Umstände,Beweggründe oder Erwägungen, aus denen eine Zahlungdurch die Anleiheschuldnerin unterbleiben mag, diegemäß den Anleihebedingungen zahlbaren Beträge zuden Fälligkeitsterminen erhalten, die in den Anleihebedingungenfestgesetzt sind. Die Garantin wird demgemäßauf erstes Anfordern alle erforderlichen Zahlungen ohnejede Einschränkung und ungeachtet etwaiger Einreden,Einwendungen oder anderer Gründe, derentwegen dieAnleiheschuldnerin keine Zahlung leistet, an die Zahlstellezur Weiterleitung an die Anleihegläubiger leisten, falls dieAnleiheschuldnerin aus irgendeinem Grunde, einschließlichhöherer Gewalt, diese Beträge nicht zahlt. Die Garantinverpflichtet sich, alle Beträge, die zur Erfüllung der sichaufgrund dieser Garantie ergebenden Zahlungsverpflichtungender Garantin erforderlich sind, der Zahlstelle inEuro zur Verfügung zu stellen.(3) Diese Garantie ist ein Vertrag zugunsten der Anleihegläubigerals begünstigte Dritte im Sinne von § 328 Absatz1 des Bürgerlichen Gesetzbuchs, der jedem Anleihegläubigerdas Recht gewährt, die Erfüllung der hierinübernommenen Verpflichtungen unmittelbar von derGarantin zu verlangen und diese Verpflichtungen unmittelbargegen die Garantin durchzusetzen.(4) Sämtliche Zahlungen der Garantin auf die Garantiewerden ohne Abzug oder Einbehalt gegenwärtiger oderzukünftiger Steuern, Abgaben oder amtlicher Gebührengleich welcher Art gezahlt, die von oder in den Niederlandenoder der Bundesrepublik Deutschland oder für derenRechnung oder von oder für Rechnung einer dort zurSteuer-, Abgaben- oder Gebührenerhebung ermächtigtenKörperschaft oder Behörde auferlegt, erhoben oder eingezogenwerden, es sei denn, ein solcher Abzug oder Einbehaltist gesetzlich vorgeschrieben. Die Garantin ist zu einerdarüber hinaus gehenden Zahlung an die Anleihegläubigerim Hinblick auf einen solchen Abzug oder Einbehaltnicht verpflichtet.(5) Diese Garantie begründet unmittelbare, unbedingte,nicht dinglich besicherte und nicht nachrangige Verbind-GUARANTEESüdzucker AG Mannheim/OchsenfurtMannheim, Federal Republic of GermanyTo Deutsche Bank Aktiengesellschaft for the benefit of theBondholders ofSüdzucker International Finance B.V.7 250,000,0003.00% Bonds of 2003/2008Convertible into Ordinary Bearer Shareswith No Par Value ofSüdzucker AG Mannheim/Ochsenfurtunconditionally und irrevocably guaranteed bySüdzucker AG Mannheim/Ochsenfurt(1) Südzucker AG Mannheim/Ochsenfurt, Mannheim (the“Guarantor”), hereby unconditionally and irrevocablyguarantees towards Deutsche Bank Aktiengesellschaft,Frankfurt am Main (“Deutsche Bank”), for the benefit ofthe Bondholders the due and punctual payment, inaccordance with the terms and conditions of the Bonds(the “Conditions”), of any and all sums expressed to bepayable by Südzucker International Finance B. V., Oud-Beijerland, The Netherlands (the “Issuer”), under theBonds.(2) The intent and purpose of this Guarantee is to ensurethat the Bondholders under all circumstances, andregardless of the factual or legal circumstances, motivesor considerations by reason of which the Issuer may failto effect payment, shall receive the amounts payablepursuant to the Conditions on the due dates stipulated inthe Conditions. Accordingly, the Guarantor will effect allnecessary payments without any limitation andregardless of any defences or pleas or other reasonsbecause of which the Issuer fails to pay, to the PayingAgent for transfer to the Bondholders if the Issuer for anyreason, including force majeure, fails to pay suchamounts. The Guarantor undertakes to make available tothe Paying Agent in euro all amounts required for theperformance of the payment obligations of the Guarantorarising under this Guarantee.(3) This Guarantee shall constitute a contract for thebenefit of the Bondholders as third party beneficiariespursuant to § 328 subsection (1) of the German Civil Code(Bürgerliches Gesetzbuch) giving rise to the right of eachBondholder to require performance of the obligationsundertaken herein directly from the Guarantor and toenforce such obligations directly against the Guarantor.(4) All payments by the Guarantor on this Guarantee willbe made free and clear of and without deduction orwithholding for or on account of any present or futuretaxes, duties or governmental charges of any naturewhatsoever imposed, levied or collected by or in or onbehalf of The Netherlands or the Federal Republic ofGermany or by or on behalf of any political subdivision orauthority thereof or therein having power to tax, unlesssuch deduction or withholding is required by law. TheGuarantor shall not be required to make any additionalpayments to the Bondholders in respect of suchdeduction or withholding.(5) This Guarantee constitutes direct, unconditional,unsecured and unsubordinated obligations of the56

lichkeiten der Garantin und hat mindestens den gleichenRang wie alle anderen gegenwärtigen und zukünftigennicht dinglich besicherten und nicht nachrangigen Verbindlichkeitender Garantin, soweit nicht zwingendegesetzliche Bestimmungen etwas anderes vorschreiben.(6) Die Garantin verpflichtet sich, solange bis Kapital undZinsen, sowie alle weiteren auf die Schuldverschreibungen(einschließlich der gemäß § 19 der Anleihebedingungenbegebenen zusätzlichen Schuldverschreibungen)zahlbaren Beträge in vollem Umfang an die Zahlstellegezahlt worden sind, für andere Schuldverschreibungenoder ähnliche verbriefte Schuldtitel oder Schuldscheindarlehenoder für dafür übernommene Garantien und/oderGewährleistungen keine Sicherheiten durch Belastungihres Vermögens zu bestellen, ohne jeweils die Anleihegläubigerzur gleichen Zeit und im gleichen Rang an solchenSicherheiten oder an solchen anderen Sicherheiten,die von einem internationalen angesehenen unabhängigenWirtschaftsprüfer als gleichwertige Sicherheiten anerkanntwerden, teilnehmen zu lassen. Diese Verpflichtungbesteht jedoch nicht für eine Sicherheit, die (i) gesetzlichvorgeschrieben ist, oder (ii) im Zusammenhang mit staatlichenGenehmigungen verlangt wird.(7) Im Falle einer Ersetzung der Anleiheschuldnerin durcheine andere Gesellschaft als die Garantin gemäß § 15 derAnleihebedingungen erstreckt sich diese Garantie aufsämtliche von der Neuen Anleiheschuldnerin gemäß denAnleihebedingungen zahlbare Beträge. Dies gilt auchdann, wenn die Neue Anleiheschuldnerin die Verpflichtungenaus den Schuldverschreibungen unmittelbar von derGarantin übernommen hat.(8) Begriffe, die in dieser Garantie verwendet werden undin den Anleihebedingungen definiert sind, haben in dieserGarantie die gleiche Bedeutung wie in den Anleihebedingungen,soweit sie in dieser Garantie nicht anderweitigdefiniert sind.(9) Die Deutsche Bank verpflichtet sich, das Original dieserGarantie bis zur Erfüllung aller Verpflichtungen aus denSchuldverschreibungen und dieser Garantie für dieAnleihegläubiger in Verwahrung zu halten.(10) Die Rechte und Pflichten aus dieser Garantie bestimmensich nach dem Recht der Bundesrepublik Deutschland.Erfüllungsort und nicht-ausschließlicher Gerichtsstandist Frankfurt am Main, Bundesrepublik Deutschland.(11) Der deutsche Wortlaut dieser Garantie ist allein rechtsverbindlich.Die englische Übersetzung ist unverbindlich.Mannheim, den 8. Dezember 2003Südzucker AG Mannheim/OchsenfurtGuarantor and ranks at least pari passu with all otherpresent and future unsecured and unsubordinatedobligations of the Guarantor, except as otherwiseprovided by mandatory rules of law.(6) The Guarantor hereby undertakes, until such time asprincipal and interest as well as any other amountspayable on the Bonds (including additional Bonds issuedpursuant to § 19 of the Conditions) have been paid to thePaying Agent, not to provide any security, byencumbering any of its own assets, for other bonds,notes, debentures or similar debt instruments orcertificates of indebtedness (Schuldscheindarlehen) or forguarantees or indemnities in respect thereof without atthe same time having the Bondholders share equally andrateably in such security or such other security as shall beapproved by an independent accounting firm ofinternationally recognized standing as being equivalentsecurity. This undertaking shall not apply to security (i)which is mandatory according to applicable laws, or (ii)which is required as a prerequisite for governmentalapprovals.(7) In the event of a substitution of the Issuer by acompany other than the Guarantor pursuant to § 15 of theConditions, this Guarantee shall extend to any and allamounts expressed to be payable pursuant to theConditions by the Substitute Issuer. The foregoing shallalso apply if the Substitute Issuer shall have assumed theobligations arising from the Bonds directly from theGuarantor.(8) Unless otherwise defined herein, terms used hereinand defined in the Conditions shall in this Guarantee havethe meaning attributed to them in the Conditions.(9) Deutsche Bank undertakes to hold the original of thisGuarantee in custody for the Bondholders until allobligations under the Bonds and this Guarantee aredischarged.(10) The rights and obligations under this Guarantee shallbe governed by the laws of the Federal Republic ofGermany. Place of performance and non-exclusive placeof jurisdiction shall be Frankfurt am Main, FederalRepublic of Germany.(11) The German text of this Guarantee is the only legallybinding one. The English translation is for convenienceonly.Mannheim, December 8, 2003Südzucker AG Mannheim/OchsenfurtDurch:Name:Wir nehmen die obenstehenden Erklärungen zugunstender Anleihegläubiger an.Frankfurt am Main, den 8. Dezember 2003Deutsche Bank AktiengesellschaftBy:Name:We hereby accept all of the above declarations for thebenefit of the Bondholders.Frankfurt am Main, December 8, 2003Deutsche Bank AktiengesellschaftDurch:Name:By:Name:57

VERPFLICHTUNGSERKL¾RUNGZUR EINR¾UMUNGVON WANDLUNGSRECHTENSüdzucker AG Mannheim/OchsenfurtMannheim, Bundesrepublik DeutschlandAn die Deutsche Bank Aktiengesellschaft zugunsten derAnleihegläubiger derSüdzucker International Finance B.V.7 250.000.0003,00% Schuldverschreibungen von 2003/2008mit Wandlungsrecht in auf den Inhaber lautendeStammaktien ohne Nennbetrag derSüdzucker AG Mannheim/Ochsenfurtunbedingt und unwiderruflich garantiert durch dieSüdzucker AG Mannheim/Ochsenfurt(1) Die Südzucker International Finance B.V., Oud-Beijerland,Niederlande (die „Anleiheschuldnerin“), hat aufgrundeines zwischen ihr als Darlehensgeberin und derSüdzucker AG Mannheim/Ochsenfurt, Mannheim (die„Garantin“), als Darlehensnehmerin abgeschlossenenDarlehensvertrags mit Datum vom 8. Dezember 2003(der „Darlehensvertrag“) den Emissionserlös aus derBegebung der Schuldverschreibungen in Höhe von5 250.000.000 von der Deutsche Bank Aktiengesellschaft,Frankfurt am Main („Deutsche Bank“), unmittelbar an dieGarantin als Darlehen (das „Darlehen“) auszahlen lassen.Die Fälligkeiten von Kapital- und Zinszahlungen auf dasDarlehen entsprechen den Fälligkeiten von Kapital- undZinszahlungen auf die Schuldverschreibungen; bei vorzeitigerRückzahlung oder Kündigung von Schuldverschreibungenist das Darlehen in Höhe der den vorzeitig zurückgezahltenoder gekündigten SchuldverschreibungenZugehörigen Darlehensansprüche (§ 11(2)(a) der Bedingungender Schuldverschreibungen (die „Anleihebedingungen“))zur vorzeitigen Rückzahlung fällig; ferner ermäßigtsich der Betrag des Darlehens in Höhe der zusammenmit Schuldverschreibungen übertragenen ZugehörigenDarlehensansprüche bei Ausübung des Wandlungsrechtsdurch Übertragung von Schuldverschreibungen gemäߧ 7(2) der Anleihebedingungen.(2) Gemäß den Bestimmungen des Darlehensvertrags hatdie Anleiheschuldnerin ihre Ansprüche gegen die Garantinauf Zahlung von Kapital auf das Darlehen an die DeutscheBank für Rechnung der Anleihegläubiger zur Sicherheitfür die Ansprüche auf Zahlung von Kapital auf dieSchuldverschreibungen abgetreten. Dabei entfällt auf jedeSchuldverschreibung ein Teilbetrag des Darlehens, derdem Zugehörigen Darlehensanspruch entspricht. DieSicherungsabtretung ist auflösend bedingt durch die vollständigeRückzahlung der Schuldverschreibungen, fürwelche das Wandlungsrecht nicht ausgeübt wurde.(3) Der Zugehörige Darlehensanspruch ist mit der betreffendenSchuldverschreibung untrennbar verbunden. Überden Zugehörigen Darlehensanspruch kann nicht gesondertverfügt werden; insbesondere kann dieser Anspruchnicht gesondert abgetreten, verpfändet oder sonst belastetwerden. Bei Übertragung einer Schuldverschreibunggeht der Zugehörige Darlehensanspruch mit über, ohnedass es dafür einer ausdrücklichen rechtsgeschäftlichenErklärung bedarf. Im Falle der Ausübung des Wandlungsrechtsgehen bei Übertragung von Schuldverschreibungenauf die Garantin durch die Wandlungsstelle die ZugehörigenDarlehensansprüche mit auf die Garantin überund erlöschen damit.(4) Die Garantin gewährt hiermit unbedingt und unwiderruflichjedem Anleihegläubiger das Recht, gemäß denUNDERTAKINGFOR GRANTING CONVERSIONRIGHTSSüdzucker AG Mannheim/OchsenfurtMannheim, Federal Republic of GermanyTo Deutsche Bank Aktiengesellschaft for the benefitof the Bondholders ofSüdzucker International Finance B.V.5 250,000,0003.00% Bonds of 2003/2008Convertible into Ordinary Bearer Shares withNo Par Value ofSüdzucker AG Mannheim/Ochsenfurtunconditionally und irrevocably guaranteed bySüdzucker AG Mannheim/Ochsenfurt(1) Südzucker International Finance B. V., Oud-Beijerland,The Netherlands (the “Issuer”), pursuant to a loanagreement dated December 8, 2003 (the “LoanAgreement”) between the Issuer as lender and SüdzuckerAG Mannheim/Ochsenfurt, Mannheim (the “Guarantor”),as borrower, has caused Deutsche BankAktiengesellschaft, Frankfurt am Main (“Deutsche Bank”),to disburse the proceeds from the sale of the Bonds in anamount of 5 250,000,000 directly to the Guarantor to fundthe loan (the “Loan”). The due dates for payments ofprincipal and interest on the Loan correspond to the duedates for payments of principal and interest on the Bonds;in the event of an early redemption of Bonds, the Loan islikewise subject to early repayment in an amount equal tothe Appertaining Claim (§ 11(2)(a) of the terms andconditions of the Bonds (the “Conditions”)) of the Bondsearly redeemed; finally, the amount of the Loan will bereduced in an amount equal to the Appertaining Claimstransferred together with Bonds if the Conversion Right isexercised by delivering Bonds pursuant to § 7(2) of theConditions.(2) Pursuant to the provisions of the Loan Agreement, theIssuer has assigned the claims against the Guarantor forpayment of principal under the Loan Agreement toDeutsche Bank acting on account of the Bondholders forpurposes of securing the claims for payment of principalof the Bonds. Upon such transfer, a partial amount of theLoan equal to the Appertaining Claim will be attributableto each Bond. Such transfer for security purposes will besubject to the condition subsequent (auflösendeBedingung) of the redemption of the Bonds for which theConversion Right was not exercised.(3) The Appertaining Claim is undetachable from therelevant Bond. The Appertaining Claim cannot bedisposed of separately; in particular, the AppertainingClaim cannot be separately assigned, pledged orotherwise encumbered. Any transfer of a Bond results inthe transfer of the Appertaining Claim without any explicitdeclaration of transfer being required. In the event of theexercise of the Conversion Right, the Appertaining Claimsshall pass to the Guarantor together with the Bondstransferred to the Guarantor by the Conversion Agent andexpire therewith.(4) The Guarantor hereby unconditionally and irrevocablygrants to each Bondholder the right to convert, in58

Anleihebedingungen (insbesondere gemäß §§ 6, 7 und 8der Anleihebedingungen) jederzeit während des Ausübungszeitraumsseine Schuldverschreibung ganz, nichtjedoch teilweise, zu einem Wandlungspreis je Aktie von5 20,53 in Aktien zu wandeln (vorbehaltlich einer Anpassunggemäß § 10 und § 16(4) der Anleihebedingungen)und gegebenenfalls Barbeträge gemäß §§ 8(2) oder10(1)(b) der Anleihebedingungen zu erhalten.(5) Diese Verpflichtungserklärung begründet unmittelbare,unbedingte, nicht dinglich besicherte und nicht nachrangigeVerbindlichkeiten der Garantin und hat mindestensden gleichen Rang wie alle anderen gegenwärtigen undzukünftigen nicht dinglich besicherten und nicht nachrangigenVerbindlichkeiten der Garantin, soweit nicht zwingendegesetzliche Bestimmungen etwas anderes vorschreiben.(6) Diese Verpflichtungserklärung ist ein Vertrag zugunstender Anleihegläubiger als begünstigte Dritte im Sinnevon § 328 Absatz 1 des Bürgerlichen Gesetzbuchs, derjedem Anleihegläubiger das Recht gewährt, die Erfüllungder hierin übernommenen Verpflichtungen unmittelbarvon der Garantin zu verlangen und diese Verpflichtungenunmittelbar gegen die Garantin durchzusetzen.(7) Begriffe, die in dieser Verpflichtungserklärung verwendetwerden und in den Anleihebedingungen definiertsind, haben in dieser Verpflichtungserklärung die gleicheBedeutung wie in den Anleihebedingungen, soweit sie indieser Verpflichtungserklärung nicht anderweitig definiertsind.(8) Die Deutsche Bank verpflichtet sich, das Original dieserVerpflichtungserklärung bis zur Erfüllung aller Verpflichtungenaus den Schuldverschreibungen und dieser Verpflichtungserklärungfür die Anleihegläubiger in Verwahrungzu halten.(9) Die Rechte und Pflichten aus dieser Verpflichtungserklärungbestimmen sich nach dem Recht der BundesrepublikDeutschland. Erfüllungsort und nicht-ausschließlicherGerichtsstand ist Frankfurt am Main, BundesrepublikDeutschland.(10) Der deutsche Wortlaut dieser Verpflichtungserklärungist allein rechtsverbindlich. Die englische Übersetzung istunverbindlich.Mannheim, den 8. Dezember 2003Südzucker AG Mannheim/Ochsenfurtaccordance with the Conditions (in particular §§ 6, 7 and 8of the Conditions), at any time during the ConversionPeriod each Bond in whole, but not in part, into Shares ata Conversion Price of 5 20.53 per Share (subject to anadjustment of the Conversion Price pursuant to § 10 and§ 16(4) of the Conditions), and to receive additional cashamounts payable pursuant to §§ 8(2) or 10(1)(b) of theConditions, if any.(5) This Undertaking constitutes direct, unconditional,unsecured and unsubordinated obligations of theGuarantor and ranks at least pari passu with all otherpresent and future unsecured and unsubordinatedobligations of the Guarantor, except as otherwiseprovided by mandatory rules of law.(6) This Undertaking shall constitute a contract for thebenefit of the Bondholders as third party beneficiariespursuant to § 328 subsection (1) German Civil Code(Bürgerliches Gesetzbuch) giving rise to the right of eachBondholder to require performance of the obligationsundertaken herein directly from the Guarantor and toenforce such obligations directly against the Guarantor.(7) Unless otherwise defined herein, terms used hereinand defined in the Conditions of the Bonds shall in thisUndertaking have the meaning attributed to them in theConditions of the Bonds.(8) Deutsche Bank undertakes to hold this Undertaking incustody for the Bondholders until all obligations underthe Bonds and this Undertaking are discharged.(9) The rights and obligations under this Undertaking shallbe governed by the laws of the Federal Republic ofGermany. Place of performance and non-exclusive placeof jurisdiction shall be Frankfurt am Main, FederalRepublic of Germany.(10) The German text of this Undertaking is the onlylegally binding one. The English translation is forconvenience only.Mannheim, December 8, 2003Südzucker AG Mannheim/OchsenfurtDurch:Name:By:Name:Wir nehmen die obenstehenden Erklärungen zugunstender Anleihegläubiger an.Frankfurt am Main, den 8. Dezember 2003Deutsche Bank AktiengesellschaftWe hereby accept all of the above declarations for thebenefit of the Bondholders.Frankfurt am Main, December 8, 2003Deutsche Bank AktiengesellschaftDurch:Name:By:Name:59

DARLEHENSVERTRAG(dieser „Vertrag“)zwischenSüdzucker International Finance B.V.Oud-Beijerland, Niederlande(die „Anleiheschuldnerin“)undSüdzucker AG Mannheim/OchsenfurtMannheim, Bundesrepublik Deutschland(die „Garantin“)PR¾AMBEL:(A) Die Anleiheschuldnerin, die Garantin und die DeutscheBank Aktiengesellschaft, Frankfurt am Main („DeutscheBank“), Bayerische Hypo- und Vereinsbank AG und DZBANK AG Deutsche Zentral-Genossenschaftsbank (zusammenmit der Deutschen Bank, die „Manager“), haben am4. November 2003 einen Übernahmevertrag (der „Übernahmevertrag“)abgeschlossen, in dem sich die Anleiheschuldnerinverpflichtet hat, Schuldverschreibungen imGesamtnennbetrag von 5 250.000.000 zu begeben und andie Deutsche Bank zu verkaufen, die in auf den Inhaberlautende Stammaktien der Garantin ohne Nennbetragwandelbar sind (die „Schuldverschreibungen“). Der Übernahmevertragsieht vor, dass Begebung und Übernahmeder Schuldverschreibungen am 8. Dezember 2003 oder aneinem anderen Tag, auf den sich die Anleiheschuldnerin,die Garantin und die Manager geeinigt haben, (der „Valutierungstag“)vorgenommen werden.(B) Die Anleiheschuldnerin hat sich in dem Übernahmevertragverpflichtet, der Garantin den Emissionserlös ausden gemäß (A) begebenen Schuldverschreibungen inHöhe von 5 250.000.000 (der „Emissionserlös“) als Darlehen(das „Darlehen“) zu gewähren. Der Übernahmevertragbestimmt, dass der Emissionserlös von der DeutschenBank unmittelbar an die Garantin auszuzahlen ist.(C) Die Bedingungen der Schuldverschreibungen (die„Anleihebedingungen“) bestimmen, dass die Ansprücheder Anleihegläubiger auf Zahlung von Kapital auf dieSchuldverschreibungen durch die Ansprüche der Anleiheschuldneringegen die Garantin auf Zahlung von Kapitalauf das Darlehen besichert werden.(D) Die Anleihebedingungen sind diesem Vertrag alsAnlage 1 beigefügt.Dies vorausgeschickt, kommen die Parteien wie folgt überein:§1(Definitionen)In diesem Vertrag kommt Begriffen, die in den Anleihebedingungendefiniert sind, die gleiche Bedeutung zu,soweit nicht in diesem Darlehensvertrag anderweitig definiert.§2(Darlehen)(1) Die Anleiheschuldnerin gewährt der Garantin vorbehaltlichder Auszahlung des Emissionserlöses ein Darlehenin Höhe von5 250.000.000(in Worten: Euro zweihundertfünfzig Millionen).(2) Das Darlehen ist am Valutierungstag an die Garantinauszuzahlen.(3) Die Auszahlung des Darlehens erfolgt durch die Zahlungdes Emissionserlöses durch die Deutsche Bank aufein von der Garantin zu bestimmendes Konto der Garantin.LOAN AGREEMENT(this “Agreement”)betweenSüdzucker International Finance B.V.,Oud-Beijerland, The Netherlands(the “Issuer”)andSüdzucker AG Mannheim/OchsenfurtMannheim, Federal Republic of Germany(the “Guarantor”)WHEREAS:(A) The Issuer, the Guarantor, Deutsche BankAktiengesellschaft, Frankfurt am Main (“Deutsche Bank”),Bayerische Hypo- und Vereinsbank AG and DZ BANK AGDeutsche Zentral-Genossenschaftsbank (together withDeutsche Bank, the “Managers”), have entered into anunderwriting agreement (the “Underwriting Agreement”)dated November 4, 2003 pursuant to which the Issuer hasundertaken to issue and sell to the Deutsche Bank bonds,convertible into ordinary bearer shares with no par valueof the Guarantor (the “Bonds”), in the aggregate principalamount of 5 250,000,000. The Underwriting Agreementprovides that the issue and subscription of the Bondsshall be effected on December 8, 2003 or on such otherdate as the Issuer, the Guarantor and the Managers haveagreed (the “Closing Date”).(B) The Issuer has undertaken in the UnderwritingAgreement to pass on to the Guarantor the proceeds fromthe issue of the Bonds pursuant to (A) above in theamount of 5 250,000,000 (the “Proceeds”) by way of loan(the “Loan”). The Underwriting Agreement provides thatthe Proceeds shall be disbursed by Deutsche Bank directlyto the Guarantor.(C) The terms and conditions of the Bonds (the“Conditions”) provide that the claims of the Bondholdersfor payment of principal on the Bonds are to be securedby the claims of the Issuer against the Guarantor underthe Loan for payment of principal on the Loan.(D) The Conditions are set forth in Exhibit 1.It is agreed as follows:§1(Definitions)Terms defined in the Conditions shall have the samemeaning in this Agreement, unless otherwise defined inthis Agreement.§2(The Loan)(1) Subject to disbursement of the Proceeds, the Issuergrants to the Guarantor a loan in the principal amount of5 250,000,000(in words: two hundred and fifty million).(2) The Loan shall be disbursed to the Guarantor on theClosing Date.(3) Disbursement of the Loan shall be effected byDeutsche Bank’s payment of the Proceeds to an accountof the Guarantor specified by the Guarantor.60

§3(Sicherungsabtretung)(1) Die Anleiheschuldnerin wird am Valutierungstag ihreAnsprüche gegen die Garantin auf Zahlung von Kapitalaus diesem Vertrag gemäß dem diesem Vertrag alsAnlage 2 beigefügten Abtretungsvertrag an die DeutscheBank für Rechnung der Anleihegläubiger zur Sicherheitfür die Ansprüche auf Zahlung von Kapital auf die Schuldverschreibungenabtreten (die „Sicherungsabtretung“).Dabei entfällt auf jede Schuldverschreibung ein Teilbetragdes Darlehens, der dem Zugehörigen Darlehensanspruch(§ 11(2)(a) der Anleihebedingungen) entspricht.(2) Der Zugehörige Darlehensanspruch ist mit der betreffendenSchuldverschreibung untrennbar verbunden. Überden Zugehörigen Darlehensanspruch kann nicht gesondertverfügt werden; insbesondere kann dieser Anspruchnicht gesondert abgetreten, verpfändet oder sonst belastetwerden. Bei Übertragung einer Schuldverschreibunggeht der Zugehörige Darlehensanspruch mit über, ohnedass es dafür einer ausdrücklichen rechtsgeschäftlichenErklärung bedarf. Im Falle der Ausübung des Wandlungsrechtsgehen bei Übertragung von Schuldverschreibungenauf die Garantin durch die Wandlungsstelle diejeweils Zugehörigen Darlehensansprüche mit auf dieGarantin über und erlöschen damit. Eine etwaige Differenzzwischen dem Nennbetrag des zugehörigen Darlehensanspruchsund dem Wert der bei Wandlung der Schuldverschreibungenzu liefernden Aktien geht zu Lasten und fürRechnung der Garantin.§3(Security Assignment)(1) On the Closing Date the Issuer shall assign the claimsunder this Agreement for payment of principal on theLoan to Deutsche Bank for account of the Bondholders assecurity for the claims for payment of principal of theBonds in accordance with the assignment agreementattached hereto as Exhibit 2. A partial amount of the Loanequal to the Appertaining Claim (§ 11(2)(a) of theConditions) shall be attributable to each Bond.(2) The Appertaining Claim is undetachable from therelevant Bond. The Appertaining Claim cannot bedisposed of separately; in particular, the AppertainingClaim cannot be separately assigned, pledged orotherwise encumbered. Any transfer of a Bond results inthe transfer of the Appertaining Claim without any explicitdeclaration of transfer being required. In the event of theexercise of the Conversion Right, the Appertaining Claimsshall pass to the Guarantor together with the relevantBonds transferred to the Guarantor by the ConversionAgent and expire therewith. Any difference between theAppertaining Claim and the value of the Shares to bedelivered upon conversion of the Bonds will be solely forthe risk and account of the Guarantor.§4(Zinsen; Rückzahlungen; Konfusion)(1) Das Darlehen wird mit einem gesondert festzulegendenjährlichen Zinssatz verzinst. Die Fälligkeitstermineund Beträge für Kapital- und Zinszahlungen auf das Darlehenentsprechen den Fälligkeitsterminen und Beträgenfür Kapital- und Zinszahlungen auf die Schuldverschreibungen.Falls die Fälligkeit von Zahlungen auf die Schuldverschreibungengemäß § 4(4) der Anleihebedingungenhinausgeschoben ist, wird die Fälligkeit von Zahlungenauf das Darlehen in gleicher Weise hinausgeschoben.Sind Zinsen für einen Zeitraum von weniger als einemJahr zu berechnen, so werden sie auf der Grundlage dertatsächlich verstrichenen Tage, geteilt durch 365 (bei nichtin ein Schaltjahr fallenden Tagen) bzw. 366 (bei in einSchaltjahr fallenden Tagen) berechnet.(2) An dem Tag, an dem Kapital auf die Schuldverschreibungenfällig ist, ist das Darlehen in Höhe der den fälligenSchuldverschreibungen Zugehörigen Darlehensansprüchezuzüglich aufgelaufener Zinsen zur Rückzahlung fällig.(3) Falls Schuldverschreibungen gemäß § 16 der Anleihebedingungenvorzeitig fällig gestellt oder gemäß § 14 derAnleihebedingungen gekündigt worden sind oder dieAnleiheschuldnerin die Schuldverschreibungen gemäߧ 3(3) oder (4) der Anleihebedingungen gekündigt hat, istdas Darlehen in Höhe der den vorzeitig fällig gestelltenoder gekündigten Schuldverschreibungen ZugehörigenDarlehensansprüche zuzüglich aufgelaufener Zinsen zurRückzahlung fällig.(4) Falls bei Ausübung des Wandlungsrechts (§ 6(1) derAnleihebedingungen) Schuldverschreibungen zusammenmit Zugehörigen Darlehensansprüchen auf die Wandlungsstelleund durch diese auf die Garantin übertragenwerden, erlöschen insoweit die Ansprüche aus diesemVertrag in Höhe der auf die Garantin übertragenen ZugehörigenDarlehensansprüche.(5) Die Garantin wird die ihr gemäß § 7(2) der Anleihebedingungenübertragenen Schuldverschreibungen un-§4(Interest; Repayments; Discharge)(1) The Loan shall bear interest at a rate per annum to beseparately agreed. The due dates and amounts forpayments of principal and interest on the Loancorrespond to the due dates and amounts for paymentsof principal and interest on the Bonds. In case the duedate for payments on the Bonds has been extendedpursuant to § 4(4) of the Conditions, the due date ofpayments on the Loan shall be extended accordingly. Ifinterest is required to be calculated for a period of lessthan one year, it will be calculated on the basis of theactual number of days elapsed, divided by 365 (thosedays not falling in a leap year) or 366 (those days falling ina leap year), as the case may be.(2) On a date on which principal on the Bonds is due, theLoan shall be due for repayment in an amount equal to theAppertaining Claims of the Bonds that are due, plusinterest accrued thereon.(3) If the Bonds have been declared due prior to theoriginal due date pursuant to § 16 of the Conditions orterminated pursuant to § 14 of the Conditions, or if theIssuer has terminated the Bonds pursuant to § 3(3) or (4)of the Conditions, the Loan shall be likewise due for earlyrepayment in an amount equal to the Appertaining Claimsof the Bonds early redeemed, plus interest accruedthereon.(4) If Bonds together with Appertaining Claims aretransferred to the Conversion Agent and by it to theGuarantor in connection with the exercise of theConversion Right (§ 6(1) of the Conditions), all rights andclaims under this Agreement shall expire to the extent ofsuch transfer.(5) The Guarantor shall transfer the Bonds transferred to itpursuant to § 7(2) of the Conditions without undue delay61

verzüglich auf die Anleiheschuldnerin übertragen und diesergegenüber keinerlei Ansprüche aus den so übertragenenSchuldverschreibungen geltend machen. Die Anleiheschuldnerinwird diese Schuldverschreibungen entwerten.(6) Zahlungen auf das Darlehen erfolgen in Euro.to the Issuer and shall not raise any claims or rights undersuch Bonds. The Issuer will cancel such Bonds.(6) Payments under the Loan shall be made in euro.§5(Steuern)Sämtliche Zahlungen auf das Darlehen sind von derGarantin ohne Einbehalt oder Abzug von oder wegengegenwärtiger oder zukünftiger Steuern, Abgaben oderamtlicher Gebühren gleich welcher Art zu zahlen, die vonoder in den Niederlanden oder der BundesrepublikDeutschland oder von oder für Rechnung einer dort zurErhebung von Steuern, Abgaben oder Gebühren ermächtigtenKörperschaft oder Behörde auferlegt, erhoben, odereingezogen werden, es sei denn, ein solcher Abzug oderEinbehalt ist gesetzlich vorgeschrieben. Die Garantin istim Hinblick auf einen solchen Abzug oder Einbehalt nichtzu einer zusätzlichen Zahlung an die Anleiheschuldnerinverpflichtet.§6(¾nderung oder Aufhebung dieses Vertrags)Die Anleiheschuldnerin und die Garantin verpflichten sich,die Bestimmungen dieses Vertrags (vorbehaltlich desnachfolgenden Satzes) nicht zu ändern oder aufzuhebenund alles zu unterlassen, was die Rechte der Anleihegläubigeraus der Sicherungsabtretung beeinträchtigenkönnte. Eine ¾nderung oder Aufhebung dieses Vertragesdarf nur erfolgen, wenn die Rechte der Anleihegläubigerdadurch nicht beeinträchtigt werden.§5(Taxes)All payments on the Loan shall be made by the Guarantorwithout withholding or deduction of any present or futuretaxes, duties or governmental charges of whatever natureimposed, levied or withheld by or in The Netherlands orthe Federal Republic of Germany or by or on behalf of anypolitical subdivision or authority thereof or therein havingpower to tax, unless such deduction or withholding isrequired by law. The Guarantor shall not be required tomake any additional payments to the Issuer in respect ofsuch deduction or withholding.§6(Amendment or Termination of this Agreement)The Issuer and the Guarantor undertake not to amend orterminate any provisions of this Agreement and to refrainfrom anything that could impair the rights of theBondholders under the Security Assignment orotherwise. An amendment or termination of thisAgreement may only be effected if the rights of theBondholders are not impaired thereby.§7(Verzicht auf Gegenrechte)Die Garantin verzichtet hinsichtlich sämtlicher Ansprücheder Anleiheschuldnerin aus diesem Vertrag auf die Geltendmachungder Aufrechnung, von Zurückbehaltungsrechten,Pfandrechten oder Gegenrechten.§7(Waiver of Counter-Rights)With respect to all claims of the Issuer under thisAgreement, the Guarantor agrees not to assert any rightsof set-off, retention rights, liens or counter-claims.§8(Abtretbarkeit)Die Rechte und Ansprüche der Anleiheschuldnerin ausdiesem Vertrag auf Zahlung von Kapital und Zinsen aufdas Darlehen werden von der Anleiheschuldnerin nurzugunsten der Anleihegläubiger abgetreten werden.§8(Assignment)The rights and claims of the Issuer under this Agreementfor payment of principal of the Loan may only be assignedfor the benefit of the Bondholders.§9(Sonstiges)(1) Dieser Vertrag und sämtliche Rechte und Pflichten ausdiesem Vertrag bestimmen sich nach dem Recht der BundesrepublikDeutschland.(2) Erfüllungsort und nicht-ausschließlicher Gerichtsstandist Frankfurt am Main, Bundesrepublik Deutschland.(3) Sollte eine Bestimmung dieses Vertrages ganz oderteilweise unwirksam sein oder werden, so bleiben dieübrigen Bestimmungen dieses Vertrages wirksam.Anstelle der unwirksamen Bestimmung gilt eine wirksameBestimmung, die dem wirtschaftlichen Zweck der unwirksamenBestimmung soweit wie rechtlich möglich Rechnungträgt.(4) Der deutsche Wortlaut dieses Darlehensvertrages istallein rechtsverbindlich. Die englische Übersetzung istunverbindlich.§9(Miscellaneous)(1) This Agreement and all rights and obligations derivingtherefrom shall be governed by the laws of the FederalRepublic of Germany.(2) Place of performance and non-exclusive place ofjurisdiction shall be Frankfurt am Main, Federal Republicof Germany.(3) Should any provision of this Agreement be or becomevoid in whole or in part, the other provisions shall remainin force. The void provision shall be deemed substitutedby a valid provision which accomplishes as far as legallypossible the economic purpose of the void provision.(4) The German text of this Agreement is the only legallybinding one. The English translation is for convenienceonly.62

8. Dezember 2003Südzucker International Finance B.V.Dezember 8, 2003Südzucker International Finance B.V.Durch:Name:Südzucker AG Mannheim/OchsenfurtBy:Name:Südzucker AG Mannheim/OchsenfurtDurch:Name:By:Name:63

ABTRETUNGSVERTRAG(1) Die Südzucker International Finance B.V., Oud-Beijerland,Niederlande (die „Anleiheschuldnerin“), hat aufgrundeines zwischen ihr als Darlehensgeberin und derSüdzucker AG Mannheim/Ochsenfurt, Mannheim (die„Garantin“), als Darlehensnehmerin abgeschlossenenDarlehensvertrags mit Datum vom 8. Dezember 2003 (der„Darlehensvertrag“) den Emissionserlös aus der Begebungder Schuldverschreibungen in Höhe von5 250.000.000 von der Deutsche Bank Aktiengesellschaft,Frankfurt am Main („Deutsche Bank“), unmittelbar an dieGarantin als Darlehen (das „Darlehen“) auszahlen lassen.Die Fälligkeiten von Kapital- und Zinszahlungen auf dasDarlehen entsprechen den Fälligkeiten von Kapital- undZinszahlungen auf die Schuldverschreibungen; bei vorzeitigerRückzahlung der Schuldverschreibungen ist das Darlehenin Höhe der den vorzeitig zurückgezahlten SchuldverschreibungenZugehörigen Darlehensansprüche(Absatz (2)) zur vorzeitigen Rückzahlung fällig; fernerermäßigt sich der Betrag des Darlehens in Höhe der denübertragenen Schuldverschreibungen Zugehörigen Darlehensansprüchebei Ausübung des Wandlungsrechts durchÜbertragung von Schuldverschreibungen gemäß § 7(2)der Bedingungen der Schuldverschreibungen (die„Anleihebedingungen“).(2) Die Anleiheschuldnerin tritt hiermit ihre Ansprüchegegen die Garantin auf Zahlung von Kapital auf das Darlehenan die Deutsche Bank für Rechnung der Anleihegläubigerzur Sicherheit für die Ansprüche auf Zahlungvon Kapital auf die Schuldverschreibungen ab (die „Sicherungsabtretung“).Dabei entfällt auf jede Schuldverschreibungein Teilbetrag (der „Zugehörige Darlehensanspruch“)des Darlehens, der sich nach folgender Formelbestimmt:Zugehöriger Darlehensanspruch ¼Gesamtnennbetrag des DarlehensZahl der SchuldverschreibungenDie Sicherungsabtretung der Zugehörigen Darlehensansprücheerfolgt auflösend bedingt durch die vollständigeRückzahlung der Schuldverschreibungen, für welche dasWandlungsrecht nicht ausgeübt wurde. Die DeutscheBank ist ermächtigt, die Sicherungsabtretung für Rechnungder Anleihegläubiger anzunehmen. Die Erklärungder Sicherungsabtretung und die Annahme bedürfennicht der Bekanntmachung.(3) Die Deutsche Bank nimmt hiermit die Sicherungsabtretunggemäß Absatz (2) an.(4) Der Zugehörige Darlehensanspruch ist mit der betreffendenSchuldverschreibung untrennbar verbunden. Überden Zugehörigen Darlehensanspruch kann nicht gesondertverfügt werden; insbesondere kann dieser Anspruchnicht gesondert abgetreten, verpfändet oder sonst belastetwerden. Bei Übertragung einer Schuldverschreibunggeht der Zugehörige Darlehensanspruch mit über, ohnedass es dafür einer ausdrücklichen rechtsgeschäftlichenErklärung bedarf. Im Falle der Ausübung des Wandlungsrechtsgehen bei Übertragung von Schuldverschreibungenauf die Garantin durch die Wandlungsstelle diejeweils Zugehörigen Darlehensansprüche mit auf dieGarantin über und erlöschen damit.(5) Begriffe, die in diesem Abtretungsvertrag verwendetwerden und in dem Darlehensvertrag oder in den Anleihebedingungendefiniert sind, haben in diesem Abtretungsvertragdie gleiche Bedeutung wie in dem Darlehensvertragbzw. in den Anleihebedingungen, soweit sie indiesem Abtretungsvertrag nicht anderweitig definiertsind.(6) Die Deutsche Bank verpflichtet sich, das Original diesesVertrags bis zur Erfüllung aller Verpflichtungen aus denASSIGNMENT AGREEMENT(1) Südzucker International Finance B. V., Oud-Beijerland,The Netherlands (the “Issuer”), has caused DeutscheBank Aktiengesellschaft, Frankfurt am Main (“DeutscheBank”) pursuant to a loan agreement dated December 8,2003 (the “Loan Agreement”) between the Issuer, aslender, and Südzucker AG Mannheim/Ochsenfurt,Mannheim, (the “Guarantor”), as borrower, to disbursethe proceeds from the sale of the Bonds in the amount of5 250,000,000 directly to the Guarantor to fund the loan(the “Loan”). The due dates for payments of principal andinterest on the Loan correspond to the due dates forpayments of principal and interest on the Bonds; in theevent of an early redemption of Bonds the Loan islikewise subject to early repayment in an amount equal tothe Appertaining Claims (paragraph (2)) of the Bonds earlyredeemed; finally, the amount of the Loan will be reducedin an amount equal to the Appertaining Claims transferredtogether with Bonds if the Conversion Right is exercisedby delivering Bonds pursuant to § 7(2) of the terms andconditions of the Bonds (the “Conditions”).(2) The Issuer hereby assigns the claims against theGuarantor for payment of principal on the Loan toDeutsche Bank for the account of the Bondholders forpurposes of securing the claims for payment of principalof the Bonds (the “Security Assignment”). Upon suchSecurity Assignment, a partial amount of the Loan (the“Appertaining Claim”) will be attributable to each Bond,such partial amount being determined in accordance withthe following formula:Aggregate Principal Amount of the LoanAppertaining Claim ¼Number of BondsThe Security Assignment shall be subject to the conditionsubsequent (auflösende Bedingung) of the redemption ofthose Bonds for which the Conversion Right has not beenexercised. Deutsche Bank shall be authorized to accept theSecurity Assignment for the account of the Bondholders.The declarations of the Security Assignment and itsacceptance need not be published.(3) Deutsche Bank hereby accepts the SecurityAssignment pursuant to paragraph (2).(4) The Appertaining Claim is undetachable from therelevant Bond. The Appertaining Claim cannot bedisposed of separately; in particular, the AppertainingClaim cannot be separately assigned, pledged orotherwise encumbered. Any transfer of a Bond results inthe transfer of the Appertaining Claim without any explicitdeclaration of transfer being required. In the event of theexercise of the Conversion Right, the Appertaining Claimsshall pass to the Guarantor together with the relevantBonds transferred to the Guarantor by the ConversionAgent and expire therewith.(5) Unless otherwise defined herein, terms used hereinand defined in the Loan Agreement or the Conditions, asthe case may be, shall in this Assignment Agreementhave the meaning attributed to them in the LoanAgreement or the Conditions, as the case may be.(6) Deutsche Bank undertakes to hold the original of thisAssignment Agreement in custody for the Bondholders64

Schuldverschreibungen und aus diesem Vertrag für dieAnleihegläubiger in Verwahrung zu halten.(7) Auf diesen Abtretungsvertrag findet das Recht der BundesrepublikDeutschland Anwendung. Erfüllungsort undnicht-ausschließlicher Gerichtsstand ist Frankfurt amMain, Bundesrepublik Deutschland.(8) Der deutsche Wortlaut dieses Abtretungsvertrages istallein rechtsverbindlich. Die englische Übersetzung istunverbindlich.8. Dezember 2003Südzucker International Finance B.V.until all obligations under the Bonds and under thisAssignment Agreement are discharged.(7) The rights and obligations under this AssignmentAgreement shall be governed by the laws of the FederalRepublic of Germany. Place of performance and nonexclusiveplace of jurisdiction shall be Frankfurt am Main,Federal Republic of Germany.(8) The German text of this Assignment Agreement is theonly legally binding one. The English translation is forconvenience only.December 8, 2003Südzucker International Finance B.V.Durch:Name:Südzucker AG Mannheim/OchsenfurtBy:Name:Südzucker AG Mannheim/OchsenfurtDurch:Name:Deutsche Bank AktiengesellschaftBy:Name:Deutsche Bank AktiengesellschaftDurch:Name:By:Name:65

Description of the SharesShare CapitalThe issued share capital of Südzucker AG Mannheim/Ochsenfurt consists of 5 174,787,946 dividedinto 174,787,946 bearer non-par value shares with a notional value of 5 1.00 each. The issued sharecapital has been fully paid in. Each share carries one vote. There is only one class of shares.Conditional CapitalThe general assembly of Südzucker AG Mannheim/Ochsenfurt held on July 31, 2003 resolved:The ordinary share capital is to be increased by up to 5 13,000,000 through the issue of up to13,000,000 new shares with an imputed amount of the ordinary share capital of 5 1 each. Thecontingent capital increase will only be carried out to the extent that (a) holders or creditors ofconversion rights or option warrants which are attached to convertible or option bonds issued by thecompany or its directly or indirectly majority-held subsidiaries up to July 31, 2008 who exercise theirconversion or option rights, or (b) holders or creditors of convertible bonds issued by the company orits directly or indirectly majority-owned subsidiaries up to July 31, 2008 exercise their obligation toconvert. The new shares are entitled to a share in profits from the beginning of the year in which theyare issued by way of exercising convertible option rights or fulfilling conversion obligations.The conditional capital was registered with the commercial register on August 1, 2003.The shares to be delivered upon conversion of the Bonds (which are the subject of this ListingProspectus) will be issued from such conditional capital.Preemptive RightsUnder the German Stock Corporation Act, an existing shareholder in a stock corporation has apreferential right to subscribe for issues of new shares by that corporation in proportion to thenumber of shares he holds in the corporation’s existing share capital. These rights do not apply toshares issued out of conditional capital. Preemptive rights also apply to securities that may beconverted into shares, securities with warrants, profit-sharing certificates and securities withdividend rights. The German Stock Corporation Act only allows the exclusion of this preferentialright in limited circumstances. At least three-quarter of the share capital represented at the meetingmust vote for exclusion. In addition to approval by the shareholders, the exclusion of preemptiverights generally requires a justification. Preemptive rights related to the issuance of new shares,however, may be excluded without such justification if (i) the share capital of the Guarantor isincreased for cash contributions, and (ii) the amount of the increase does not exceed 10% of theissued share capital, and (iii) the shares are sold at a price not substantially lower than the currentquoted share price.Preemptive rights resulting from a capital increase generally may be transferred and may be tradedon any of the German stock exchanges upon which our shares are traded for a limited number of daysprior to the final date on which the preemptive rights may be exercised.Dividend RightsShareholders participate in profit distributions in proportion to the number of shares they hold.Südzucker AG Mannheim/Ochsenfurt declared and paid cash dividends to the shareholders of 5 1.34per ordinary share and 5 1.38 per preference share for the financial year 2000/01 (including an extradividend in the amount of 5 1.00 each), of 5 0.47 per share for the financial year 2001/02 and of 5 0.50per share for the financial year 2002/03.66

Disclosure RequirementThe German Securities Trading Act requires each person whose shareholding reaches, exceeds or,after exceeding, falls below a threshold of 5%, 10%, 25 %, 50% or 75% of the voting rights of a listedcorporation to notify the relevant issuer and the German Federal Supervisory Authority for SecuritiesTrading in writing within seven calendar days after they have reached, exceeded or fallen below sucha threshold. In their notification such shareholders must also state the number of shares they hold.Such shareholders cannot exercise any rights from those shares until they have satisfied thisdisclosure requirement. In addition, the German Securities Trading Act contains various rulesdesigned to ensure the attribution of shares to the person who has effective control over the exerciseof the voting rights attached to those shares.Repurchase of Own SharesSüdzucker AG Mannheim/Ochsenfurt may not acquire its own shares unless authorized by theshareholders at the general shareholders’ meeting or in other very limited circumstances set out inthe German Stock Corporation Act. Shareholders may not grant a share repurchase authorizationlasting for more than 18 months.The rules in the German Stock Corporation Act generally limit repurchases to 10% of our sharecapital and resales must be made either on a stock exchange, in a manner that treats all shareholdersequally or in accordance with the rules that apply to preemptive rights relating to a capital increase.Südzucker AG Mannheim/Ochsenfurt is currently not authorized to repurchase its own shares.Liquidation RightsUnder the German Stock Corporation Act, the assets of the company remaining after discharge of allliabilities in the case of a liquidation will be distributed among the shareholders in proportion to thenotional par value of shares.Share Price and Market InformationThe principal trading market for the shares is the Frankfurt Stock Exchange. The shares have tradedon the Frankfurt Stock Exchange since February 1, 1927. The tables below set forth, for the periodsindicated, the high and low closing sales prices for the shares on the Frankfurt Stock Exchange, asreported by the Frankfurt Stock Exchange Xetra trading system:High Low Average(Price per share (5))Financial year ended February 28, 2003Ordinary shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.40 13.40 16.07Financial year ended February 28, 2002Ordinary shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.98 11.20 15.43Preference shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.88 12.30 15.60Financial year ended February 28, 2001Ordinary shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.50 10.10 12.06Preference shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.30 10.15 12.3967

Sales price per share from March 1, 2003 to December 7, 2003 (in 5):Mar Date April Date May Date June Date July DateHigh . . . . . . 15.33 21.03. 15.18 30.04. 16.99 29.05. 16.20 02.06. 14.96 03.07.Low . . . . . . 13.25 11.03. 14.20 03.04. 14.51 08.05. 14.95 20.06. 14.18 23.07.Aug Date Sept Date Oct Date Nov DateHigh . . . . . . 14.40 01.08. 14.86 04.09. 14.74 27.10. 15.30 04.11.Low . . . . . . 13.89 06.08. 13.70 26.09. 13.80 01.10. 14.90 03.11.The closing sales price for the shares on the Frankfurt Stock Exchange on December 5, 2003, was5 15.25.Paying Agent regarding the SharesThe paying agent regarding the Shares is Deutsche Bank Aktiengesellschaft.68

TaxationThe following summary of certain Dutch and German taxation consequences is based on the lawsand practice in force as of the date of this Listing Prospectus and is subject to any changes in law andpractices (and the interpretation and application thereof) occurring after such date, which changescould be made on a retroactive basis. The following summary does not purport to be acomprehensive description of all the tax considerations that may be relevant to a decision to acquire,hold or dispose of the Bonds or to convert Bonds into shares, and does not purport to deal with thetax consequences applicable to all categories of investors, some of which (such as dealers insecurities) may be subject to special rules. This summary is of a general nature based on theunderstanding of the Issuer and the Guarantor of current law and practice. Save as otherwiseindicated, this summary only addresses the position of investors who do not have any connectionwith The Netherlands other than the holding of the Bonds. Investors should consult theirprofessional advisers on the possible tax consequences of their subscribing for, acquiring, holding,selling or redeeming Bonds or converting Bonds into Shares under the laws of their country ofcitizenship, residence, domicile or incorporation.The NetherlandsGeneralThis summary does not address the Netherlands tax consequences of residents of The Netherlands.Prospective investors should consult their professional advisers on the possible tax consequences oftheir subscribing for, acquiring, holding, selling or redeeming Bonds or converting Bonds into Sharesunder the laws of their country of citizenship, residence, domicile or incorporation.In addition, this summary does not address the Netherlands tax consequences of Bondholders, whohold a substantial interest (aanmerkelijk belang) within the meaning of section 4.3 of the Income TaxAct 2001 in the Issuer. In general a Bondholder, being a non-resident individual for purposes of theIncome Tax Act 2001 or non-resident tax payer for purposes of the Corporate Income Tax Act 1969, isconsidered to hold a substantial interest in the Issuer, if he, alone or together with his partner (asstatutory defined) or certain other related persons, directly or indirectly holds (1) an interest of atleast 5 percent of the total issued share capital of the Issuer or of at least 5 percent of the issuedshare capital of a certain class of shares of the Issuer, (ii) rights to obtain, directly or indirectly, suchinterest or (iii) certain profit sharing rights in the Issuer.Withholding taxAll payments of principal and/or interest or any other amounts payable under the Bonds can be madefree of Netherlands withholding tax.Corporate income tax and individual income taxA Bondholder that is not a resident of The Netherlands, nor deemed to be a resident, nor anindividual who has opted to be taxed as a resident of The Netherlands for Netherlands tax purposes,is not taxable in respect of income derived from the Bonds and capital gains realised upon thedisposal, transfer, alienation or redemption of the Bonds or the conversion of the Bonds into Sharesprovided that:(a) such Bondholder does not have an enterprise or an interest in an enterprise which, in whole or inpart, is carried on through a permanent establishment or a permanent representative in TheNetherlands and to which enterprise or part of an enterprise, as the case may be, the Bonds areattributable; and(b) the Bonds are not attributable to the assets of an enterprise that is effectively managed in TheNetherlands, with respect to which enterprise such Bondholder is entitled to a share in its profits,other than by way of securities or pursuant to the terms of an employment contract,69

(c) and in addition for individuals only, such Bondholder does not derive income and/or capital gainsin respect of the Bonds that, on that basis of the Income Tax Act 2001 of The Netherlands, areregarded as “taxable income from one or more activities performed in The Netherlands not beingactivities that generate taxable profit or taxable wages” (belastbaar resultaat uit overigewerkzaamheden in Nederland).Gift, estate and inheritance taxesNo gift, estate or inheritance taxes will arise in The Netherlands with respect to an acquisition ofBonds by way of a gift by, or on the death of, a Bondholder who is neither resident nor deemed to beresident in The Netherlands, unless:(a) such Bondholder at the time of the gift has or at the time of such Bondholder’s death had anenterprise or an interest in an enterprise that is or was, in whole or in part, carried on through apermanent establishment or through a permanent representative in The Netherlands, and towhich enterprise or part of an enterprise, as the case may be, the Bonds are or were attributable;(b) the Bonds are or were attributable to the assets of an enterprise that is or was effectively managedin The Netherlands, and the giver is at the time of the gift or the deceased was at the time of his/her death entitled to a share in the profits of that enterprise other than by way of securities orpursuant to the terms of an employment contract; or(c) in the case of a gift of Bonds by an individual who at the date of gift was neither resident nordeemed to be resident in The Netherlands, such individual dies within 180 days after the date ofthe gift, while being resident or deemed to be resident in The Netherlands.Other taxes and dutiesNo registration, stamp, transfer or turnover taxes or other similar duties or taxes are payable in TheNetherlands in respect of the offering and issue or any transfer of Bonds or the conversion of theBonds into Shares.ResidenceA Bondholder will not become resident, or deemed to be resident, of The Netherlands by reason onlyof the holding of a Bond or the execution, performance delivery and/or enforcement of the Bonds.Federal Republic of GermanyAlthough the Bonds qualify as convertible notes (Wandelanleihen) pursuant to section 221paragraph 1 German Stock Corporation Act for corporate law purposes, there is no clear guidancewhether the Bonds also qualify as convertible notes for German tax purposes. In light of the recentchange of section 20 paragraph 2 no. 4 of the German Income Tax Act, it can, therefore, not beexcluded that the German tax authorities will qualify the Bonds as financial innovations. TheGerman tax consequences in this case are included in the following description.Taxation of the Bonds (Bondholders resident in Germany)Interest PaymentsIndividual or corporate Bondholders who are resident in the Federal Republic of Germany(individuals or entities whose residence, customary place of abode, statutory seat, head office orplace of effective management or control is located in the Federal Republic of Germany) are subjectto German personal or corporate income tax and solidarity surcharge thereon with any interestpayment received on the Bonds. Such interest is also subject to trade tax if the Bonds are part of theassets of a German trade or business. As the Bonds are not issued by a German resident issuer theinterest payments should not be subject to German withholding tax on interest from convertible70

notes (Kapitalertragsteuer auf Zinsen aus Wandelanleihen). However, if the Bonds are kept oradministered in a domestic securities deposit account by a German financial or financial serviceinstitution (“Disbursing Agent”), which term includes a German branch of a foreign financial orfinancial service institution but excludes a foreign branch of a German financial or financial serviceinstitution, (“German Administered Bonds”) a 30% withholding tax on interest payments plus a5.5% solidarity surcharge thereon will be levied on interest payments, resulting in a totalwithholding tax charge of 31.65%. Such withholding tax and solidarity surcharge thereon arecredited against the German personal or corporate income tax and the respective solidaritysurcharge of the Bondholder and any excess amount refunded to the Bondholder.Sale or Redemption of the BondsIf the Bonds are sold or redeemed during a current interest period, the accrued interest received aspart of the purchase price will be subject to personal or corporate income tax and solidarity surchargethereon as well as to trade tax, where applicable. Accrued interest paid by a purchaser as part of thepurchase price for the Bonds can be deducted from the personal or corporate income tax base. Thecapital gains received on the sale or redemption of the Bonds are only taxable if:(i) the Bonds are disposed of within one year after their acquisition, except if the aggregate amountof gain earned during the calendar year from sales of privately-held assets having occurredwithin the applicable short-term holding period is less than 5 512, or(ii) the Bondholder (or, in the case of a transfer without consideration, his or her predecessor) at anytime during the five years preceding the sale or redemption held an interest (including, amongother things, shares and convertible bonds or convertible notes) of at least 1% in the issuedshare capital of Südzucker AG Mannheim/Ochsenfurt or(iii) the Bonds are held as business assets of a German trade or business of the Bondholder in whichcase the capital gains may also be subject to trade tax.However, after the amendment of the Income Tax Act by the Tax Amendment Act, it cannot beentirely excluded that the tax authorities will qualify the Bonds as financial innovations in which caseany positive difference between the purchase price paid by the Bondholder for the Bonds and theproceeds received by the Bondholder from the sale or redemption is subject to income tax plussolidarity surcharge thereon as well as trade tax, where applicable, as additional deemed interest.If the Bonds are German Administered Bonds the Disbursing Agent will be required to withhold tax(Zinsabschlagsteuer) on accrued interest included in the sale price at a rate of 30 % (plus solidaritysurcharge at a rate of 5.5% thereon), resulting in a total tax charge of 31.65%. If the accrued interestis separately invoiced, the tax base is the invoiced interest. If the accrued interest is not separatelyinvoiced and the Bonds were held in the same securities deposit account of the seller since the dateof their acquisition by the seller, the tax base is the difference between the sales or redemptionproceeds and the issue or purchase price of the Bonds. If the accrued interest is not separatelyinvoiced and theBonds are sold after a transfer from one securities deposit account to another securities depositaccount kept at a different bank, the basis for the withholding tax and the solidarity surcharge onaccrued interest will be the amount of 30% of the sales price.Exercise of Conversion RightAccording to administrative guidance the conversion of the Bonds into Shares in case of aconvertible note (Wandelanleihe) does not give rise to a taxable capital gain for purposes of personalor corporate income tax or trade tax. The purchase price for the Bonds is carried over as acquisitioncosts for the Shares.However, it cannot be excluded entirely that the German tax authorities will qualify the Bonds asfinancial innovations. In that case, the conversion may be treated as a disposal of the Bonds for taxpurposes and the difference between the purchase price paid by the Bondholder for the Bonds and, inprinciple, the fair market value of the Shares at the time of the exchange of the Shares is also subject71

to income tax plus solidarity surcharge thereon as well as trade tax, where applicable. The 30%withholding tax plus solidarity surcharge applies in this case if the Bonds are German AdministeredBonds. If the Shares are delivered to the Bondholder, the fair market value for the Shares at the timeof the exchange is considered to be the acquisition costs for the Shares.Provided the Bonds qualify as regular convertible bonds and further provided the Bonds are held by aprivate individual as private assets for more than one year, there are arguments that the AdditionalAmount may be regarded as tax-exempt capital gain; however, it cannot be excluded that theAdditional Amount may nevertheless be treated as taxable deemed interest by the fiscal authorities.Expenses related to the income from the Bonds; special tax exemption.The Bondholder may deduct expenses related to the income from the Bonds. Where no higherexpenses related to income from capital investment are shown, the Bondholder is entitled for astandard deduction (Werbungskosten-Pauschbetrag) of5 51 p.a. (5 102 p. a. in the case of marriedcouples filing joint returns), if the Bonds are not held as business assets. In addition, Bondholderswho do not hold the Bonds as business assets are entitled to an annual special tax exemption(Sparerfreibetrag) for all capital investment income of 5 1,550 p.a. (5 3,100 p.a. in the case of marriedcouples filing joint returns). Income from the Bonds is free of withholding tax up to these limitsif an exemption order (Freistellungsauftrag) has been filed with the deposit bank. The sameapplies if the shareholder provides the deposit bank with a non-assessment certificate(Nichtveranlagungsbescheinigung) issued by the relevant tax office. The standard deduction and thespecial exemption apply to all investment income from capital investments (net of related expenses)received during the year including dividend income.Taxation of the Bonds (Bondholders not resident in Germany)Individuals or corporate Bondholders, who are not tax resident in Germany are in general not subjectto German income tax with their interest income from the Bonds unless the Bonds are held asbusiness assets of a permanent establishment or a fixed base maintained in Germany in which casesimilar tax consequences as in case of Bondholders resident in Germany would apply. Capital gainsderived from a sale or redemption of the Bonds or from the exercise of the conversion right, in casethe Bonds are traded as financial innovations will in general be subject to German personal orcorporate income tax plus solidarity surcharge thereon if(i) the Bonds are held as business assets of a German permanent establishment or fixed base of theBondholder in which case also trade tax may apply, or(ii) if the Bondholder (or, in case of a transfer without consideration, his or her predecessor) at anytime during the five years preceding the disposition held an interest (including among otherthings, shares and convertible bonds or convertible notes) of 1% or more in the issued sharecapital of Südzucker AG Mannheim/Ochsenfurt.Most tax treaties to which Germany is a party provide for a complete exemption from Germantaxation in the case of (ii).Taxation of the Shares received in Conversion of the Bonds (Shareholders resident in Germany)Dividend taxationOnly half of the dividends received by a German-resident individual are subject to income tax (plussolidarity surcharge of 5.5% thereon) (so-called half income system). Accordingly, only one half ofthe expenses attributable to the shareholding are deductible. If an individual holds the Shares asassets of a German commercial business of such shareholder, the dividend is subject to trade tax,unless the shareholder holds 10% or more of the share capital of Südzucker AG Mannheim/Ochsenfurt since the beginning of the calendar year. For corporate shareholders such dividendincome is in general free of corporate income tax and, if the shareholder held 10% or more of theshare capital of Südzucker AG Mannheim/Ochsenfurt since the beginning of the calendar year, ingeneral also free of trade tax. In this case, however, expenses directly economically related to the72

shareholding will only be deductible to the extent they exceed the amount of dividends receivedduring the tax year. Dividends are also subject to 20% withholding tax plus 5.5% solidarity surcharge(in total 21.1 %), which will be credited or refunded to the shareholder.Taxation of Capital GainsHalf of the capital gains from the disposal of the Shares received in exchange for the Bonds by anindividual as shareholder are taxable, if(i) the Shares are held as business assets of a trade or business,(ii) the Shares are sold within one year after the exchange, except if the aggregate amount of gainearned during the calendar year from sales of privately-held assets having occurred within theapplicable short-term holding period is less than 5 512, or(iii) the Bondholder (or, in the case of a transfer without consideration, his or her predecessor) at anytime during the five years preceding the disposition held an interest (including, among otherthings, shares and convertible bonds or convertible notes) representing 1% or more of theissued share capital of Südzucker AG Mannheim/Ochsenfurt. For corporate shareholders capitalgains from the disposal of the Shares are in general tax-free.If and to the extent that capital gains would be tax-free, losses are also not deductible. Losses fromthe sale of the Shares held as personal (non-business) assets within the one-year period can only beset off against certain capital gains realized in the same year, the preceding year and the subsequentyears.Taxation of the Shares received in Conversion of the Bonds (Shareholders not resident in Germany)Dividend taxationDividend income received by a non-resident shareholder who does not hold the Shares as businessassets of a permanent establishment or a fixed base in Germany is subject to withholding tax (plussolidarity surcharge thereon) only. The rate is the same as applicable to resident shareholders, unlessa tax treaty reduces the withholding to a lower rate. The difference between the withholding taxincluding solidarity surcharge which was levied and the maximum rate of withholding tax permittedby an applicable tax treaty is refunded to the shareholder by the German Federal Tax Office uponapplication.Taxation of Capital GainsCapital gains from the disposition of the Shares are only subject to German tax as described aboveunder “Shareholders resident in Germany” if:(i) such shareholder (or, in the case of the transfer without consideration, his or her predecessor) atany time during the five years preceding the disposition, directly or indirectly, held an interest(including, among other things, shares and convertible bonds or convertible notes) of 1% ormore in the issued share capital of Südzucker AG Mannheim/Ochsenfurt or(ii) if the Shares were held as assets of a permanent establishment or fixed base in Germany.Most tax treaties to which Germany is a party provide for a complete exemption from Germantaxation in the case of (i).Inheritance and Gift TaxUnder German law, the transfer of the Bonds or of the Shares will be subject to German inheritanceor gift tax on a transfer by reason of death or as a gift if at the time of the transfer of the assets:73

(i)the donor or transferor or the heir, donee or other beneficiary is resident in Germany at the timeof the transfer, or, if a German citizen, was not continuously outside of Germany and withoutGerman residence for more than five years; or(ii) except as mentioned under (i) the Bonds or Shares belong to the business assets of a permanentestablishment maintained in Germany by the deceased or donor; or(iii) in case of the transfer of the Shares, the deceased or donor has held, alone or together withrelated persons, directly or indirectly, 10% or more of the registered share capital of SüdzuckerAG Mannheim/Ochsenfurt at the time of the transfer.The few presently existing German estate tax treaties usually provide that German inheritance or gifttax may only be imposed in cases (i) and (ii) above.Special rules may apply to certain German expatriates (German citizens or former German citizensliving abroad).Other TaxesNo stamp, issue, registration or similar taxes or duties will be payable in Germany in connection withthe issuance, delivery or execution of the Bonds. Currently, net assets tax is not levied in Germany.EU Savings DirectiveOn 3 June 2003 the EU Council of Economic and Finance Ministers adopted a new directive regardingthe taxation of savings income. The directive is scheduled to be applied by Member States from1 January 2005, provided that certain non-EU countries adopt similar measures from the same date.Under the directive each Member State will be required to provide to the tax authorities of anotherMember State details of payments of interest or other similar income paid by a person within itsjurisdiction to an individual resident in that other Member State; however, Austria, Belgium andLuxembourg may instead apply a withholding system for a transitional period in relation to suchpayments, deducting tax at rates rising over time to 35%. The transitional period is to commence onthe date from which the directive is to be applied by Member States and to terminate at the end of thefirst fiscal year following agreement by certain non-EU countries to the exchange of informationrelating to such payments.PROSPECTIVE PURCHASERS OF BONDS ARE ADVISED TO CONSULT THEIR OWN TAX ADVISORSAS TO THE TAX CONSEQUENCES OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF BONDS,INCLUDING THE EFFECT OF ANY STATE OR LOCAL TAXES, UNDER THE TAX LAWS IN GERMANYAND EACH COUNTRY OF WHICH THEYARE RESIDENTS.74

Index to Financial StatementsThe management report (Lagebericht) of Südzucker AG for the financial year 2002/03 included in thefinancial section of this Listing Prospectus pursuant to German Stock Exchange Regulationrequirements was prepared in May 2003 and contains a discussion of the financial result in 2002/03as well as certain forward looking information. In view of the time lapsed since then, such forwardlookingstatements do not necessarily reflect the current view of Südzucker AG, and such informationis superseded by the other information contained in this Listing Prospectus.Südzucker AG Mannheim/Ochsenfurt (Guarantor)Consolidated Statements of Income for the Financial Years Ended February 28, 2003, 2002,and2001....................................................................... F-2Consolidated Balance Sheets as of February 28, 2003, 2002 and 2001 . . . . . . . . . . . . . . . . . . . . F-3Consolidated Statements of Cash Flow for the Financial Years Ended February 28, 2003,2002,and2001 ................................................................. F-4Statements of Movements in Shareholders’ Equity for the Financial Years EndedFebruary 28, 2003, 2002, and 2001 Including Minority Interests . . . . . . . . . . . . . . . . . . . . . . . . F-5Statements of Movements in Non-current Assets for the Financial Years Ended February 28,2003,2002,and2001 ............................................................ F-6Notes to the Consolidated Financial Statements for the Financial Year Ended February 28,2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-12Management Report (Lagebericht) for the Financial Year Ended February 28, 2003 . . . . . . . . F-46Auditor’s Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-80Interim Report for the First Half of the Financial Year 2003/04 . . . . . . . . . . . . . . . . . . . . . . . . . . . F-81Südzucker International Finance B. V. (Issuer)Statements of Income for the Financial Years Ended February 28, 2003 and 2002 . . . . . . . . . . F-90Balance Sheets as of February 28, 2003 and 2002 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-91Notes to the Financial Statements for the Financial Year Ended February 28, 2003 . . . . . . . . . F-92Director’s Report for the Financial Year Ended February 28, 2003 . . . . . . . . . . . . . . . . . . . . . . . . F-97Auditor’s Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-98Interim Report for the First Half of the Financial Year 2003/04 . . . . . . . . . . . . . . . . . . . . . . . . . . . F-9975

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SÜDZUCKER AG MANNHEIM/OCHSENFURTCONSOLIDATED FINANCIAL STATEMENTSFOR THE FINANCIALYEARS ENDED FEBRUARY 28,2003, 2002 AND 2001F-1

SÜDZUCKER GROUPCONSOLIDATED STATEMENTS OF INCOME FOR THE FINANCIALYEARSENDED FEBRUARY 28, 2003, 2002, AND 20011.3.2002 –28.2.20031.3.2001 –28.2.2002(5 million)1.3.2000 –28.2.2001Sales .......................................... 4,383.8 4,776.1 4,664.0Change in work in process and finished goodsinventories and internal costs capitalized . . . . . . . . . 24.9 (74.5) 92.1Other operating income . . . . . . . . . . . . . . . . . . . . . . . . . 129.9 150.3 207.8Cost of materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,702.1) (2,595.3) (2,592.6)Personnel expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (526.0) (684.3) (728.0)Depreciation (excluding goodwill) . . . . . . . . . . . . . . . . . (189.2) (220.2) (243.2)Other operating expenses . . . . . . . . . . . . . . . . . . . . . . . . (601.1) (887.0) (1,008.5)Operating profit ................................ 520.3 465.1 391.6Restructuring costs and other items . . . . . . . . . . . . . . . (33.0) (3.1) (42.8)Amortisation of goodwill . . . . . . . . . . . . . . . . . . . . . . . . (72.5) (29.9) (30.9)Income from ordinary operating activities .......... 414.8 432.1 317.9Financial expense, net . . . . . . . . . . . . . . . . . . . . . . . . . . . (41.1) (44.2) (53.7)Earnings before income taxes .................... 373.7 387.9 264.2Taxes on income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (58.3) (106.8) (54.9)Net earnings for the year ......................... 315.4 281.1 209.3Minority interests’ share of net earnings . . . . . . . . . . . (56.0) (49.2) (21.4)Net earnings for the year after minority interests .... 259.4 231.9 187.95/shareEarnings per share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.52 1.45 1.30F-2

SÜDZUCKER GROUPCONSOLIDATED BALANCE SHEETSAS OF FEBRUARY 28, 2003, 2002, AND 200128.2.2003 28.2.2002 28.2.2001(5 million)ASSETSIntangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,271.4 1,294.4 347.1Tangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,607.4 1,588.2 1,718.8Financial assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 357.9 420.2 321.2Non-current assets .............................. 3,236.7 3,302.8 2,387.1Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,557.6 1,508.1 1,390.4Receivables and other assets . . . . . . . . . . . . . . . . . . . . . 592.4 596.1 571.2Securities and cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 427.5 428.9 574.6Current assets .................................. 2,577.6 2,533.1 2,536.2Deferred tax assets .............................. 11.4 7.4 24.0Total assets .................................... 5,825.7 5,843.3 4,947.3LIABILITIES AND SHAREHOLDERS’ EQUITYSubscribed capital of Südzucker AG . . . . . . . . . . . . . . . 174.8 174.8 143.0Capital reserves of Südzucker AG . . . . . . . . . . . . . . . . . 938.3 938.3 588.7Revenue reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 712.1 529.4 629.71,825.2 1,642.5 1,361.4Minority interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 395.8 367.4 341.6Shareholders’ equity ............................ 2,221.0 2,009.9 1,703.0Provisions for pensions . . . . . . . . . . . . . . . . . . . . . . . . . . 369.1 366.2 358.3Deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . 342.7 393.9 365.8Other provisions and accrued liabilities . . . . . . . . . . . . 607.0 675.9 456.1Total provisions and accrued liabilities ............. 1,318.8 1,436.0 1,180.2Financial liabilities .............................. 1,435.7 1,570.9 1,174.4Other liabilities ................................. 850.2 826.5 889.7Total liabilities and shareholders’ equity ........... 5,825.7 5,843.3 4,947.3F-3

SÜDZUCKER GROUPCONSOLIDATED STATEMENTS OF CASH FLOW FOR THE FINANCIALYEARS ENDEDFEBRUARY 28, 2003, 2002, AND 20012002/03 2001/02 2000/01(5 million)Group net earnings for the year . . . . . . . . . . . . . . . . . . . . . . . . . . . 315.4 281.1 209.3Depreciation of non-current assets . . . . . . . . . . . . . . . . . . . . . . . . . 264.6 463.2 287.0Write-ups of non-current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . (3.5) (5.4) (0.8)Decrease in medium-term and long-term provisions andaccruals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (7.6) (33.6) (12.8)Other expenses not using cash/gain on disposals of financialassets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.3 (154.3) 15.2Gross cashflow from operating activities ................... 580.2 551.0 497.9Gain on disposals of items included in non-current assets . . . . (54.5) (9.4) (7.1)Increase/Decrease(-) in short-term provisions and accruals . . . . (117.9) 134.6 (48.7)Increase in inventories, receivables and other assets . . . . . . . . . (6.2) (42.4) (156.6)Increase/Decrease in liabilities (excluding financial liabilities) . 6.9 (224.0) 54.9Net cash flow from operating activities .................... 408.5 409.8 340.4Cash received on disposals of items included in non-currentassets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 136.3 456.4 36.4Capital expendituresTangible and intangible non-current assets . . . . . . . . . . . . . . . (206.5) (218.8) (214.5)Financial assets, including acquisitions of consolidatedsubsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (45.8) (1,670.5) (37.0)Cash included in acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (44.3) (56.9) 3.5Net cash flow from investing activities ..................... (160.3) (1,489.8) (211.6)Net cash flow from operating activities and from investingactivities ............................................. 248.2 (1,080.0) 128.8Capital increases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.0 549.4 68.1Dividends paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (119.8) (233.1) (145.4)Treasury shares acquired and re-issued . . . . . . . . . . . . . . . . . . . . 19.4 (3.3) (9.3)Bonds issued . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.0 500.0 300.0Receipt/repayment of financial liabilities . . . . . . . . . . . . . . . . . . . . (147.5) 120.5 (129.9)Cash flow from financing activities ........................ (247.9) 933.5 83.5Change in cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . 0.3 (146.5) 212.3Effect of exchange rate changes on cash and cash equivalents (1.7) 0.8 0.6Cash and cash equivalents at the beginning of the year . . . . . . . 428.9 574.6 361.7Cash and cash equivalents at the end of the year ............ 427.5 428.9 574.6of which: cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 206.6 303.9 189.9of which: other securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 220.9 125.0 384.7F-4

STATEMENTS OF MOVEMENTS IN SHAREHOLDERS’ EQUITYFOR THE FINANCIALYEARS ENDED FEBRUARY 28, 2003, 2002, AND 2001INCLUDING MINORITY INTERESTSBalance at1.3.2002Netearningsfor theyearCapitalincreases(5 million)ExchangeratechangesOtherchangesBalance at28.2.2003Subscribed capital ofSüdzucker AG . . . . . . . . . . . . . . . . 174.8 174.8Capital reserve of Südzucker AG . . 938.3 938.3Revenue Reserves . . . . . . . . . . . . . . 529.4 259.4 (81.4) 0.0 11.7 712.1Revenue reserves ............. 534.0 259.4 (81.4) 18.4 730.4Fair value reserve ............. (1.3) (6.7) (8.0)Accumulated foreign currencytranslation differences ....... (3.3) (7.0) 0.0 (10.3)Minority interests . . . . . . . . . . . . . . . 367.4 56.0 (38.5) (4.7) 15.6 395.82,009.9 315.4 (119.9) 0.0 (11.7) 27.3 2,221.0Balance at1.3.2001Netearningsfor theyearCapitalincreases(5 million)ExchangeratechangesOtherchangesBalance at28.2.2002Subscribed capital ofSüdzucker AG . . . . . . . . . . . . . . . . 143.0 31.8 174.8Capital reserve of Südzucker AG . . 588.7 349.6 938.3Revenue Reserves . . . . . . . . . . . . . . 629.7 231.9 (191.2) 0.0 17.5 (158.5) 529.4Revenue reserves ............. 495.7 231.9 (191.2) (2.4) 534.0Fair value reserve ............. 154.8 (156.1) (1.3)Accumulated foreign currencytranslation differences ....... (20.8) 17.5 (3.3)Minority interests . . . . . . . . . . . . . . . 341.6 49.2 (41.9) 168.0 10.2 (159.7) 367.41,703.0 281.1 (233.1) 549.4 27.7 (318.2) 2,009.9Balance at1.3.2000Netearningsfor theyearDistributionsDistributionsDistributionsCapitalincreases(5 million)ExchangeratechangesOtherchangesBalance at28.2.2001Subscribed capital ofSüdzucker AG . . . . . . . . . . . . . . . . 136.2 6.8 143.0Capital reserve of Südzucker AG . . 527.4 61.3 588.7Revenue Reserves . . . . . . . . . . . . . . 550.3 187.9 (118.7) 0.0 0.7 9.5 629.7Revenue reserves ............. 462.6 187.9 (118.7) (36.1) 495.7Fair value reserve ............. 114.2 40.6 154.8Accumulated foreign currencytranslation differences ....... (26.5) 0.7 5.0 (20.8)Minority interests . . . . . . . . . . . . . . . 404.7 21.4 (26.7) (1.4) (56.4) 341.61,618.6 209.3 (145.4) 68.1 (0.7) (46.9) 1,703.0F-5

STATEMENTS OF MOVEMENTS IN NON-CURRENT ASSETS FOR THEBalance at1.3.2002Gross acquisition or production costChange incompaniesincl. in theconsolidation/Currencytranslation/Other changes Additions Transfers Disposals(5 million)Balance at28.2.2003Intangible assetsConcessions, industrial and similarrights . . . . . . . . . . . . . . . . . . . . . . . . . 87.0 0.0 1.6 0.1 4.1 84.6Goodwill . . . . . . . . . . . . . . . . . . . . . . . . 1,556.0 51.5 2.6 0.0 0.0 1,610.1On-account payments on intangibleassets . . . . . . . . . . . . . . . . . . . . . . . . . 0.1 0.0 0.1 (0.1) 0.0 0.1Total intangible assets ............ 1,643.1 51.5 4.3 0.0 4.1 1,694.8Tangible assetsLand, land rights and buildingsincluding buildings on leased land 1,112.3 32.6 28.4 1.9 18.2 1,157.0Technical equipment and machinery 3,142.3 18.1 133.5 20.1 136.0 3,178.0Other equipment, factory andoffice equipment . . . . . . . . . . . . . . . 224.2 1.4 17.2 0.2 18.9 224.1On-account payments and assetsunder construction . . . . . . . . . . . . . 30.3 0.0 23.2 (22.2) 6.1 25.2Total tangible assets .............. 4,509.1 52.1 202.3 0.0 179.2 4,584.3Financial assetsShares in affiliated companies . . . . . 5.6 2.5 0.2 0.0 4.7 3.6Loans to affiliated companies . . . . . . 6.2 0.0 0.0 0.0 3.3 2.9Investments in associatedcompanies . . . . . . . . . . . . . . . . . . . . 357.6 (61.9) 34.1 (10.1) 23.0 296.7Other investments . . . . . . . . . . . . . . . . 63.3 33.4 4.2 10.1 18.3 92.7Loans to participating interests . . . . . 3.7 0.0 0.6 0.0 0.1 4.2Securities in financial assets . . . . . . . 23.8 (0.7) 12.7 0.0 1.7 34.1Other loans . . . . . . . . . . . . . . . . . . . . . . 2.0 0.1 0.3 0.0 0.6 1.8Total financial assets ............. 462.2 (26.6) 52.1 0.0 51.7 436.0Total non-current assets ofSüdzucker Group ............... 6,614.4 77.0 258.7 0.0 235.0 6,715.1F-6

FINANCIALYEARS ENDED FEBRUARY 28, 2003, 2002, and 2001Balance at1.3.2002Change incompaniesincl. in theconsolidation/Currencytranslation/Other changesDepreciationDepreciationfor the year Transfers Disposals Write-upsBalance at28.2.2003Net book valueBalance at28.2.2003(5 million) (5 million)Balance at28.2.200270.5 0.0 5.4 0.0 3.9 0.0 72.0 12.6 16.5278.2 0.7 72.5 0.0 0.0 0.0 351.4 1,258.7 1,277.80.0 0.0 0.0 0.0 0.0 0.0 0.0 0.1 0.1348.7 0.7 77.9 0.0 3.9 0.0 423.4 1,271.4 1,294.4497.9 20.4 30.0 0.0 14.3 0.0 534.0 623.0 614.42,252.6 14.3 136.3 0.4 129.4 1.9 2,272.3 905.7 889.7169.4 1.3 17.3 0.0 17.7 0.1 170.2 53.9 54.81.0 0.0 0.1 (0.4) 0.3 0.0 0.4 24.8 29.32,920.9 36.0 183.7 0.0 161.7 2.0 2,976.9 1,607.4 1,588.23.9 0.0 0.0 0.0 1.4 0.0 2.5 1.1 1.70.0 0.0 0.0 0.0 0.0 0.0 0.0 2.9 6.214.6 41.3 2.0 (4.9) 0.0 0.0 53.0 243.7 343.018.4 0.0 0.5 4.9 5.2 1.5 17.1 75.6 44.93.6 0.0 0.0 0.0 0.0 0.0 3.6 0.6 0.11.5 0.0 0.4 0.0 0.1 0.0 1.8 32.3 22.30.0 0.0 0.1 0.0 0.0 0.0 0.1 1.7 2.042.0 41.3 3.0 0.0 6.7 1.5 78.1 357.9 420.23,311.6 78.0 264.6 0.0 172.3 3.5 3,478.4 3,236.7 3,302.8F-7

Balance at1.3.2001Gross acquisition or production costChange incompaniesincl. in theconsolidation/Currencytranslation/Other changes Additions Transfers Disposals(5 million)Balance at28.2.2002Intangible assetsConcessions, industrial and similarrights . . . . . . . . . . . . . . . . . . . . . . . . . 127.4 (48.1) 10.4 1.6 4.3 87.0Goodwill . . . . . . . . . . . . . . . . . . . . . . . . 404.2 1,142.6 9.7 0.0 0.5 1,556.0On-account payments on intangibleassets . . . . . . . . . . . . . . . . . . . . . . . . . 0.1 (0.6) 0.6 0.0 0.0 0.1Total intangible assets ............ 531.7 1,093.9 20.7 1.6 4.8 1,643.1Tangible assetsLand, land rights and buildingsincluding buildings on leased land 1,326.8 (210.3) 28.4 5.8 38.4 1,112.3Technical equipment and machinery 2,987.5 80.2 98.4 18.6 42.4 3,142.3Other equipment, factory andoffice equipment . . . . . . . . . . . . . . . 463.4 (209.5) 43.8 (1.0) 72.5 224.2On-account payments and assetsunder construction . . . . . . . . . . . . . 29.3 3.7 27.5 (25.0) 5.2 30.3Total tangible assets .............. 4,807.0 (335.9) 198.1 (1.6) 158.5 4,509.1Financial assetsShares in affiliated companies . . . . . 15.5 (10.1) 0.2 0.0 0.0 5.6Loans to affiliated companies . . . . . . 2.6 3.5 0.1 0.0 0.0 6.2Investments in associatedcompanies . . . . . . . . . . . . . . . . . . . . 71.8 273.7 14.9 0.0 2.8 357.6Other investments . . . . . . . . . . . . . . . . 245.4 (184.9) 3.1 0.0 0.3 63.3Loans to participating interests . . . . . 0.8 3.0 0.0 0.0 0.1 3.7Securities in financial assets . . . . . . . 30.1 (1.7) 3.3 0.0 7.9 23.8Other loans . . . . . . . . . . . . . . . . . . . . . . 2.2 0.4 0.1 0.0 0.7 2.0Total financial assets ............. 368.4 83.9 21.7 0.0 11.8 462.2Total non-current assets ofSüdzucker Group ............... 5,707.1 841.9 240.5 0.0 175.1 6,614.4F-8

Balance at1.3.2001Change incompaniesincl. in theconsolidation/Currencytranslation/Other changesDepreciationDepreciationfor the year Transfers Disposals Write-upsBalance at28.2.2002Net book valueBalance at28.2.2002(5 million) (5 million)Balance at28.2.200192.9 (28.5) 9.9 0.0 3.8 0.0 70.5 16.5 34.591.7 (50.4) 237.2 0.0 0.3 0.0 278.2 1,277.8 312.50.0 0.0 0.0 0.0 0.0 0.0 0.0 0.1 0.1184.6 (78.9) 247.1 0.0 4.1 0.0 348.7 1,294.4 347.1585.1 (94.0) 34.8 0.1 28.1 0.0 497.9 614.4 741.72,190.6 (32.0) 135.9 0.5 37.0 5.4 2,252.6 889.7 796.9312.1 (148.8) 42.2 (0.6) 35.5 0.0 169.4 54.8 151.30.4 0.1 0.5 0.0 0.0 0.0 1.0 29.3 28.93,088.2 (274.7) 213.4 0.0 100.6 5.4 2,920.9 1,588.2 1,718.85.9 (3.4) 1.4 0.0 0.0 0.0 3.9 1.7 9.62.1 (2.1) 0.0 0.0 0.0 0.0 0.0 6.2 0.514.6 0.0 0.0 0.0 0.0 0.0 14.6 343.0 57.223.1 (5.7) 1.1 0.0 0.1 0.0 18.4 44.9 222.30.2 3.4 0.0 0.0 0.0 0.0 3.6 0.1 0.61.2 0.1 0.2 0.0 0.0 0.0 1.5 22.3 28.90.1 (0.1) 0.0 0.0 0.0 0.0 0.0 2.0 2.147.2 (7.8) 2.7 0.0 0.1 0.0 42.0 420.2 321.23,320.0 (361.4) 463.2 0.0 104.8 5.4 3,311.6 3,302.8 2,387.1F-9

Balance at1.3.2000Gross acquisition or production costChange incompaniesincl. in theconsolidation/Currencytranslation/Other changes Additions Transfers Disposals(5 million)Balance at28.2.2001Intangible assetsConcessions, industrial and similarrights . . . . . . . . . . . . . . . . . . . . . . . . . 126.0 0.0 11.2 0.0 9.8 127.4Goodwill . . . . . . . . . . . . . . . . . . . . . . . . 382.7 21.5 0.0 0.0 0.0 404.2On-account payments on intangibleassets . . . . . . . . . . . . . . . . . . . . . . . . . 0.1 0.0 0.0 0.0 0.0 0.1Total intangible assets ............ 508.8 21.5 11.2 0.0 9.8 531.7Tangible assetsLand, land rights and buildingsincluding buildings on leased land 1,289.3 20.8 23.1 4.9 11.3 1,326.8Technical equipment and machinery 2,911.2 13.7 98.7 28.1 64.2 2,987.5Other equipment, factory andoffice equipment . . . . . . . . . . . . . . . 442.8 1.2 52.5 0.0 33.1 463.4On-account payments and assetsunder construction . . . . . . . . . . . . . 34.6 (0.3) 29.0 (33.0) 1.0 29.3Total tangible assets .............. 4,677.9 35.4 203.3 0.0 109.6 4,807.0Financial assetsShares in affiliated companies . . . . . 24.5 (4.0) 8.1 0.0 13.1 15.5Loans to affiliated companies . . . . . . 0.0 2.5 0.1 0.0 0.0 2.6Investments in associatedcompanies . . . . . . . . . . . . . . . . . . . . 59.4 7.1 7.8 0.0 2.5 71.8Other investments . . . . . . . . . . . . . . . . 273.8 (22.2) 0.1 0.0 6.3 245.4Loans to participating interests . . . . . 0.4 0.0 0.6 0.0 0.2 0.8Securities in financial assets . . . . . . . 25.1 4.0 1.2 0.0 0.2 30.1Other loans . . . . . . . . . . . . . . . . . . . . . . 3.8 (0.8) 0.4 0.0 1.2 2.2Total financial assets ............. 387.0 (13.4) 18.3 0.0 23.5 368.4Total non-current assets ofSüdzucker Group ............... 5,573.7 43.5 232.8 0.0 142.9 5,707.1F-10

Balance at1.3.2000Change incompaniesincl. in theconsolidation/Currencytranslation/Other changesDepreciationDepreciationfor the year Transfers Disposals Write-upsBalance at28.2.2001Net book valueBalance at28.2.2001(5 million) (5 million)Balance at28.2.200088.0 0.0 14.0 0.0 9.1 0.0 92.9 34.5 38.060.8 0.0 30.9 0.0 0.0 0.0 91.7 312.5 321.90.0 0.0 0.0 0.0 0.0 0.0 0.0 0.1 0.1148.8 0.0 44.9 0.0 9.1 0.0 184.6 347.1 360.0544.5 9.0 38.2 0.0 6.6 0.0 585.1 741.7 744.82,092.7 8.9 146.0 0.9 57.9 0.0 2,190.6 796.9 818.5287.6 0.3 53.8 (0.9) 28.7 0.0 312.1 151.3 155.20.4 0.0 0.0 0.0 0.0 0.0 0.4 28.9 34.22,925.2 18.2 238.0 0.0 93.2 0.0 3,088.2 1,718.8 1,752.710.8 0.4 1.4 0.0 6.4 0.3 5.9 9.6 13.70.0 1.4 0.7 0.0 0.0 0.0 2.1 0.5 0.07.2 8.8 0.0 0.0 0.9 0.5 14.6 57.2 52.229.2 (6.5) 1.9 0.0 1.5 0.0 23.1 222.3 244.60.2 0.0 0.0 0.0 0.0 0.0 0.2 0.6 0.21.1 0.0 0.1 0.0 0.0 0.0 1.2 28.9 24.01.7 (0.8) 0.0 0.0 0.8 0.0 0.1 2.1 2.150.2 3.3 4.1 0.0 9.6 0.8 47.2 321.2 336.73,124.2 21.5 287.0 0.0 111.9 0.8 3,320.0 2,387.1 2,449.4F-11

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSConsolidated financial statementsI. Principles of preparationThe consolidated financial statements for 2002/03 of Südzucker AG and its subsidiaries have been prepared inaccordance with those standards issued by the International Accounting Standards Board (IASB) and interpretationsissued by the Standing Interpretation Committee (SIC) in force at February 28, 2003. The conditions set out in§ 292a of the German Commercial Code for exemption from preparation of consolidated financial statementsprepared in accordance with the German Commercial Code have been met.The significant differences between German accounting principles for consolidated financial statements and IASare as follows:- No recognition of internal expense provisions (e.g. maintenance provisions) as set out in IAS 37.- Requirement to recognise unrealised foreign currency gains as set out in IAS 21.- Requirement to recognise deferred income taxes using the liability method as set out in IAS 12.- Requirement to recognise certain financial instruments at fair values as set out in IAS 39.The financial statements of all significant consolidated domestic and foreign subsidiaries, or those subject tostatutory audit in accordance with local laws, have been audited by independent auditors, who have issuedunqualified audit opinions on those financial statements. Independent auditors have also confirmed the correctnessof the adjustments from financial statements prepared in accordance with local accounting standards to IASfinancial statements prepared in accordance with group guidelines.II. Consolidation principles1. Companies included in consolidationIn addition to Südzucker AG, all domestic and foreign subsidiaries in which Südzucker AG has direct or indirectfinancial control and which are not immaterial are fully consolidated in the consolidated financial statements.117 companies (2001/02: 115) were included in the consolidated financial statements for the year endedFebruary 28, 2003. 6 companies have been included in the consolidated financial statements for the first time.3 companies were merged in 2002/03 and one company is no longer part of the group.F-12

The shareholdings in AGRANA Beteiligungs-AG, Vienna, held by Südzucker AG and by its Austrian group ofshareholders by way of Zuckerbeteiligungs-GmbH, Vienna, each of which hold 43.2 %, were transferred to thenewly-formed Z & S Zucker und Stärke Holding AG, Vienna.Following further purchases of shares in Cukrownia Ropczyce S.A., Poland, the holding exceeded 50 % and thiscompany was fully consolidated for the first time.Raffinerie Tirlemontoise S.A. sold Compagnie de Réassurance RT S.A., Luxembourg, an insurance company actingsolely for the group.The effects on the consolidated financial statements of the change in companies consolidated are as follows:2002/03First-time consolidated companiesDe-consolidated companiesD millionNon-current assets 26.8 –Current assets 59.0 51.7Total assets 85.8 51.7Shareholders’ equity 40.9 31.8Provisions and liabilities 44.9 19.9Total liabilities and equity 85.8 51.7Sales 62.1 –Earnings for the year 6.4 3.7The previous year’s consolidated financial statements included the results of operations of the Schöller Groupfor the nine months from January 1 through September 30, 2001 before its disposal, including sales ofD 1,096.1 million and an operating profit of D 44.4 million. SLS Group’s results of operations were included inthe previous year’s consolidated financial statements for the two months from January 1 through February 28,2002, with sales of D 129.0 million, compared with sales of D 903.1 million for the whole of 2002/03.F-13

Consolidated financial statementsProportionate consolidation was used to include HUNGRANA Kft., Szabadegyhaza, Hungary (in which AGRANAZucker und Stärke AG, Vienna has a 50 % holding) and AIH Agrar-Industrie-Holding GmbH, Mannheim (in whichSüdzucker AG, Mannheim/Ochsenfurt has a 50 % holding).The consolidated financial statements include non-current assets of D 19.4 million, current assets of D 28.8 million,shareholders' equity of D 29.0 million and provisions and liabilities of D 18.7 million from the proportionateconsolidation. The consolidated statement of income includes sales of D 69.2 million and profits for the year ofD 22.7 million from the proportionately consolidated companies.The equity method was used for 5 (8) companies. Due to their overall insignificance or the lack of significantinfluence to participate in the financial and operating policy decisions of the investees as set out in IAS 28,17 investments were not included at equity and were recognised in the consolidated financial statements at cost.2. Consolidation methodsThe equity consolidation has been made using the purchase method, under which acquisition cost is set off againstthe relevant share of the subsidiary company's equity at the time of acquisition. Any difference has been allocatedto assets insofar as their market values differed from book values at that time. Any remaining difference (goodwill)is initially included in intangible assets and is amortised straight-line over its probable useful life of 20 years as setout in IAS 22. Investments in non-consolidated affiliated companies are stated at acquisition cost. Investments inassociated companies are included in the consolidated financial statements using the equity method (purchasemethod) as from their date of their acquisition or initial consolidation.Intercompany sales, expenses and income and all receivables, liabilities and provisions between consolidated entitieshave been eliminated. Intercompany profits included in non-current assets and inventories and arising fromintercompany transfers are eliminated.During 2002/03 the financial year-ends of those companies located in eastern Europe and which were included inthe consolidated financial statements as set out in IAS 27 with financial year-ends (December 31) differing fromthe Südzucker AG financial year-end (February 28), were changed to February 28. They were included with financialstatements covering fourteen months (January 1, 2002 through February 28, 2003).F-14

III. Foreign currency translationAs set out in IAS 21, the financial statements of group companies are translated directly from local currency intothe reporting currency (D), as the foreign entities carry out their financial, operating and organisational activitiesautonomously (the functional currency concept). Hence, non-current assets, other assets and liabilities aretranslated using mid-market rates ruling at the end of the year (year-end rates). Income and expense items aretranslated at average rates for the year.Movements in exchange rates of the significant currencies used in preparing the consolidated financial statementswere as follows (conversion rates to D 1):Country Year-end rate Average rate28.02.2003 28.02.2002 2002/03 2001/02Local currencyGreat Britain GBP 0.6823 0.6105 0.6370 0.6186Moldova MDL 15.3159 11.5337 13.2743 11.4693Poland PLN 4.2287 3.5068 3.9003 3.6795Singapore SGD 1.8738 1.5875 1.7331 1.6035Slovakia SKK 41.8901 42.7600 42.5728 43.2739The Czech Republic CZK 31.7700 31.9900 30.9062 34.0429Hungary HUF 243.7550 245.9553 242.9284 256.7440USA USD 1.0798 0.8653 0.9771 0.8868Differences arising from translating assets and liabilities at year-end rates compared with rates ruling at the endof the previous year, together with differences between earnings for the year translated at average rates in theincome statement and at year-end rates in the balance sheet, are charged or credited directly to reserves. The effectin 2002/03 was to decrease non-current assets by D 9.8 million and shareholders’ equity by D 11.7 million.Foreign currency receivables and liabilities included in the financial statements of consolidated companies have beentranslated at year-end rates.F-15

Consolidated financial statementsIV. Accounting policiesWhere there are alternative accounting policies available in a specific IAS, Südzucker always uses the benchmarktreatment.Acquired goodwill is recognised and amortised straight line. As set out in IAS 22, a useful life of 20 years has beenassumed for the amortisation of goodwill. Other acquired intangible assets are included at acquisition cost lessscheduled, straight-line amortisation over their expected useful lives.Tangible non-current assets are stated at acquisition or production cost less straight-line scheduled and unscheduleddepreciation. State subsidies and grants are deducted from the acquisition cost. Production cost of internallyconstructedequipment includes the cost of production materials, production wages and an appropriate share ofoverheads; third-party borrowing costs relating to the production are not included. Maintenance expenses arerecorded in the income statement when they are incurred.Scheduled depreciation of non-current assets and of intangible assets, apart from goodwill, is charged based on thefollowing useful lives:Intangible assets, excluding goodwillBuildingsTechnical equipment and machineryOther equipment, factory and office equipment2 to 5 years15 to 50 years6 to 30 years3 to 15 yearsImpairment write-downs are charged as set out in IAS 36 when the value in use of an asset falls below its bookvalue. Value in use is determined as the higher of the asset’s net realisable value or the present value of expectedcash flows from use of the asset.Shares in non-consolidated affiliated companies are included at acquisition cost. Investments in associatedcompanies, unless insignificant, are included using the equity method.The valuation of other investments, securities and loans depends on their classification as held to maturity oravailable for sale. Financial assets which are held to maturity are stated at amortised acquisition cost. Assets whichare classified as available for sale are stated in the balance sheet at fair value, and any unrealised gains and lossesare credited or charged direct to the fair value reserve in shareholders’ equity, net of any deferred taxes.Inventories are stated at acquisition or production cost using average cost or the first-in, first-out method. As setout in IAS 2, the production cost of work in process and finished goods includes direct costs and a reasonableproportion of material and production overheads, including depreciation of production machinery assuming normallevels of production capacity, and a proportion of administrative expenses. Write-downs are made to net realisablevalue where necessary. Specific write-downs are charged against slow-moving items and against items for whichnet realisable value is lower than cost.F-16

Receivables in current assets are stated at nominal values, less adequate allowances for bad debts and other risks inreceivables.Securities in current assets include securities classified as available for sale and are stated at fair value. Untilrealised, any resulting unrealised gains and losses are credited or charged direct to the fair value reserve inshareholders’ equity, net of deferred taxes.Cash and cash equivalents are included at nominal value.Write-ups of items included in non-current assets and current assets are made when the reason for charging theoriginal impairment loss no longer exists.Provisions for pensions are included as set out in IAS 19. Actuarial reports have been prepared for this purpose.Actuarial gains and losses arising from unexpected changes in the amount of the defined benefit obligation andfrom changes in actuarial assumptions and which lie within a corridor of 10 % of the defined benefit obligation arenot recognised. Such actuarial gains and losses are only recognised over the expected average remaining workinglives of the pension plan beneficiaries to the extent they exceed this corridor.The other provisions cover all discernible risks and uncertain obligations and are stated at their probable amount.Deferred taxes are recognised on temporary differences between the values of assets and liabilities in the IASbalance sheet and the tax balance sheet, as well as on tax loss carry forwards. Deferred taxes assets and deferredtax liabilities are recognised separately on the face of the balance sheet. Deferred tax assets have been offsetagainst deferred tax liabilities to the extent the related taxes on income are imposed by the same tax authorities.Deferred taxes are measured as set out in IAS 12 based on the appropriate local corporate income tax rate. With theexception of goodwill arising on consolidation, deferred taxes are recognised on all temporary differences betweenthe IAS balance sheet and the tax balance sheet.All liabilities are stated at the amounts due for payment.We refer to notes 1.9 and 1.10 for details of the recognition and measurement of financial instruments.Appropriate provisions have been set up for risks arising from contingent liabilities.Lease agreements within the Südzucker Group are all deemed to be operating leases, so lease payments areexpensed when incurred. Südzucker Group is not a lessor in any lease contracts.Research and development expenses are charged to the income statement in the period in which they are incurred.Development costs for new products are not recognised as intangible assets, as future economic benefit can only beproven once the products have been brought to market.F-17

Consolidated financial statementsV. Notes to the financial statements1. Notes to the balance sheet1.1 Non-current assetsAdditions to intangible and tangible non-current assets amounted to D 206.5 million in the group (excludingadditions arising as a result of new companies included on consolidation). Goodwill and assets stated at fair valueas a result of using the purchase method for the acquisition of companies are shown in the column headed “changein companies included in consolidation” in the statement of movements in non-current assets.Individual captions making up tangible and intangible non-current assets are detailed in the consolidated statementof movements in non-current assets.Intangible assetsIntangible assets include in particular goodwill arising on first-time consolidation, recognised as set out in IAS 22.This item also includes acquired EDP software and industrial and similar rights. D 941.5 million of the goodwillrelates to the SLS Group.As set out in IAS 22.71, subsequent adjustments were made to the acquired assets and liabilities of SLS, as a resultof which the original goodwill attributed to the acquisition of SLS Group was increased by D 42.4 million.Tangible non-current assetsAdditions (investments) to tangible assets (including intangible assets) are as follows:2002/03 2001/02D millionSegmentSugar 134.6 102.3Special products 71.9 75.7Total 206.5 178.0The increase in capital expenditures in the sugar segment is primarily due to the first-time complete inclusionof the French SLS Group. The previous year’s capital expenditures for the special products segment have beenadjusted to eliminate the Schöller Group.F-18

Financial assetsA list of all shareholdings per § 313 para. 4 HGB has been filed with the commercial register of the district court ofMannheim.1.2 InventoriesFebruary 28 2003 2002D millionRaw materials and supplies 121.0 114.0Work in process 398.0 296.5Finished goods and merchandise 1,038.5 1,097.4On-account payments 0.1 0.21,557.6 1,508.1The book value of inventories measured at net realisable value is D 84.1 million (D 56.7 million).1.3 Receivables and other assetsFebruary 28 2003 2002D millionTrade receivables 369.1 359.5Receivables from affiliated companies 1.1 3.2Receivables from participating interests 7.6 8.8Other assets 214.7 224.6[of which for taxes] [72.9] [78.8][of which with a remaining term of more than one year] [4.5] [1.6]592.4 596.1Receivables from affiliated companies arise solely from current account transactions with unconsolidatedsubsidiaries.Other assets mainly include receivables from public institutions and other receivables.F-19

Consolidated financial statements1.4 Securities and cashFebruary 28 2003 2002D millionOther securities 220.9 125.0Cash 206.6 303.9427.5 428.9Other securities consist of short-term bonds and debentures, equities and fund certificates and are readilymarketable.Amongst others, the balance of liquid funds is available to settle the liabilities of beet farmers due in March andApril 2003.1.5 Shareholders' equityThe subscribed capital of Südzucker AG is divided into 174,787,946 shares, each share having an imputed proportionof the share capital of D 1.00. At February 28, 2003 there was an authorised capital of D 9,220,374.00. Hence, theexecutive board is entitled, with the approval of the supervisory board, to increase the share capital and reserves ofthe company by up to D 18,644,488 until June 30, 2006 in one or more tranches, through the issue of new bearershares of no par value for cash.AGRANA Beteiligungs-AG sold its portfolio of 1,526,457 Südzucker AG shares for a price of D 15 per share.On February 28, 2003 this company still held 2,922,400 Südzucker AG shares for its own account.The net decrease in fair value reserve of D 6.7 million relates to an increase of D 2.0 million in the fair values ofinvestments and securities, and a decrease of D 8.7 million in the fair values of cash flow hedges. A statement ofmovements in shareholders’ equity is set out on page 61.F-20

1.6 Provision for pensionsPension plans within the Südzucker Group consist mainly of direct benefit plans. Pension benefits are normallygranted based on years of service with the company and benefit-related remuneration.The provisions for pensions have been calculated actuarially using the projected unit credit method and estimatedfuture trends in accordance with IAS 19.A discount rate of 5.5 % was used for the pension plans of domestic companies (between 5.0 % and 5.75 % forforeign companies).An expected annual increase of between 2.5 % and 3.0 % in remuneration and an increase of 1.9 % to 2.0 % inpensions has been assumed for domestic and foreign companies.Pension expense is made up as follows:2002/03 2001/02D millionCurrent service cost 6.8 5.8Interest cost 21.0 19.427.8 25.2There were no expenses or income arising from changes in plan benefits or from actuarial gains or losses.Interest cost has been included in interest expense in the statement of income. Service cost is included underpersonnel expense.A reconciliation of the defined benefit obligation and the provision shown in the consolidated balance sheet isas follows:February 28 2003 2002D millionDefined benefit obligation for direct pension benefits 409.0 382.9Unamortized actuarial gains and losses (38.7) (16.7)Fair value of plan assets (1.2) –Provision for pensions 369.1 366.2F-21

Consolidated financial statementsMovements in the provision for direct benefit obligations were as follows:2002/03 2001/02D millionProvision at March 1 366.2 358.3Change in companies consolidated – 4.1Amounts charged to expense 27.8 25.2Contributions to fund assets (1.3) –Pension payments during the period (23.6) (21.4)Provision at February 28 369.1 366.2There are similar obligations, particularly relating to foreign group companies. They are calculated actuarially, including estimatesof future cost trends.1.7 Movements in provisions and accrued liabilitiesD million01.03.2002 Change 28.02.2003in companies Additions Use ReleaseconsolidatedProvision for pensions 366.2 0.0 26.5 23.6 0.0 369.1Deferred tax liabilities 393.9 (25.8) 24.2 42.6 7.0 342.7Other provisions and accrued liabilitiesTax liabilities 155.2 (12.7) 43.7 49.0 27.8 109.4EU levies for financing thesugar market ordinance 210.0 0.0 69.4 155.9 1.0 122.5Personnel expenses 122.1 1.3 54.3 53.1 3.4 121.2Other provisions 188.6 42.3 103.3 29.0 51.3 253.9Total other provisionsand accrued liabilities 675.9 30.9 270.7 287.0 83.5 607.0Total provisions and accrued liabilities 1,436.0 5.1 321.4 353.2 90.5 1,318.8D 207.1 million (D 133.8 million) of the other provisions and accrued liabilities are long term.The tax liabilities relate to the current year and those years not yet audited by the tax authorities.F-22

Provisions for other uncertain liabilities include amounts relating to participation in the Fresenius share price movement, the fairvalues of financial instruments, re-cultivation obligations, waste water charges and other environmental obligations. The totalchanges of fair values of financial liabilities recognised in the statement of income amounts to a loss of D 69.9 million.1.8 Due dates of financial liabilities and other liabilities28.02.2003 of which remaining term 28.02.2002 of which remaining termup to 1 to 5 over up to 1 to 5 over1 year years 5 years 1 year years 5 yearsD millionBonds 1,071.4 254.4 0.0 817.0 1,033.8 220.0 - 813.8[of which convertible] [17.0] [–] [–] [17.0] [13.7] [-] [-] [13.7]Liabilities to banks 363.9 292.6 67.4 3.9 536.9 323.4 203.0 10.5Bills payable 0.4 0.4 – – 0.2 0.2 - -Financial liabilities 1,435.7 547.3 67.4 820.9 1,570.9 543.6 203.0 824.3On-account paymentsreceived on orders 7.4 7.4 0.0 15.3 15.2 0.1 -Trade accounts payable 671.7 671.4 0.2 0.1 607.8 607.6 0.1 0.1Accounts payable toaffiliated companies 3.5 3.5 0.0 0.0 3.4 3.4 - -Accounts payableto participating interests 18.6 18.6 0.0 0.0 13.7 13.7 - -Other liabilities 149.0 143.3 3.9 1.7 186.3 179.3 4.9 2.1[of which for taxes] [17.2] [17.0] [0.2] [0.0] [18.8] [18.3] [0.4] (0.1)[of which for social security] [24.5] [24.5] [0.0] [0.0] [23.9] [23.8] [-] [0.1]Other liabilities 850.2 844.3 4.1 1.8 826.5 819.2 5.1 2.2Total liabilities 2,285.9 1,391.6 71.5 822.8 2,397.5 1,362.8 208.1 826.5Further disclosures on financial liabilities are included in note 1.9 on financial instruments.Liabilities to banks of D 37.6 million were secured by real estate mortgages and of D 37.4 million by other collateralpledges at February 28, 2003.Trade accounts payable include amounts due to beet farmers totalling D 445.2 million (D 414.9 million).F-23

Consolidated financial statementsBalance sheet structure (L million)February 28, 2003AssetsLiabilities andshareholders’ equityOther (17.7 %) 1,031currentassets1,792 (30.8 %) Third-party debt(short-term)Inventories (26.7 %) 1,5581,813 (31.1 %) Third-party debt(medium- andlong-term)Non-current (55.6 %) 3,237assets2,221 (38.1 %) Shareholders'equity5,826 5,8261.9 Lending and borrowing activities (financial instruments)Südzucker Group’s treasury management controls seasonal fluctuations in liquidity on a daily basis by placing fundsthrough market channels (normal market overnight money, term deposits and securities) and raising funds by drawingdown overnight and short-term funds, fixed-interest rate loans or issuing commercial paper (CP). The CP program hasa volume of D 500 million and enables Südzucker AG, either directly or for its own account via Südzucker InternationalFinance B.V., a Dutch group financing company, to issue short-term bonds and debentures as the need arises and whenmarket conditions are suitable.F-24

Financial instruments are normally subject to interest rate change risks, foreign currency risks and credit risks, as follows:Interest rate change riskFor fixed-interest rate deposits or loans there is a risk that a change in market interest rates will lead to a change inmarket price (interest-related fair value risk).On the other hand, variable-interest rate deposits or loans are not subject to price risk, as the interest rate is adjustedtimely to market interest rates. However, due to fluctuations in short-term interest rates there is a risk relating to futureinterest payments (interest-related cash flow risk).Currency riskForeign currency risk is the risk of changes in fair values of balance sheet items induced by changes in exchange rates.Credit riskCredit risk is the risk that a counterparty will be unable to pay. Credit risks arising from deposits, securities andreceivables from derivative hedge transactions are minimised by only doing business with counterparties with first-classcreditworthiness.Financial liabilitiesTerms Interest rates Average rates Book valueD millionBonds to 9 years 5.75 %, 6.25 % 5.9 % 816.9Commercial paper to 1 year 2.67 %–2.95 % 2.81 % 254.5Liabilities to banks to 18 years 2.86 %–7.12 % 4.54 % 363.9Bills payable to 1 year – – 0.4Total 5.01% 1,435.7Book values of financial liabilities are the same as their repayment amount.For commercial paper, liabilities to banks and bills payable, book values are the same as their fair values. The fairvalue of bonds is their market value at the end of the year, and amounts to D 893.8 million. All the bonds arefixed-interest, as well as D 62.0 million of the liabilities to banks.F-25

Consolidated financial statements1.10 Derivative instrumentsSüdzucker Group uses derivative instruments to a limited extent to hedge part of the risks arising from its operating activities andplanned funding needs for its capital expenditures. The Südzucker Group mainly hedges the following risks:Interest-rate change risk on money market interest rates mainly resulting from fluctuations in liquidity levels during the campaignseason, or existing or planned floating rate debt.Foreign currency change risk which can primarily arise from sales of sugar on the world market in US dollars and from paymentobligations in foreign currencies.Product price change risk which can arise from price fluctuations on the global sugar market as well as in the energy sector.Only normal market instruments are used for hedging purposes, such as interest-rate swaps, caps and futures, and foreign currencyfutures. These instruments are used within the framework of Südzucker’s risk management system as laid down in groupguidelines, which set limits based on underlying business volumes, define authorisation procedures, prohibit the use of derivativeinstruments for speculative purposes, minimise credit risks and determine the content of internal reporting and segregation ofduties. Reviews are carried out regularly to ensure compliance with these guidelines and the correct processing and valuation oftransactions, and adherence to segregation of duties.The nominal and fair values of derivative instruments and their credit risks within the Südzucker Group are as follows:D million Nominal volume Fair value Credit risk2002/03 2001/02 2002/03 2001/02 2002/03 2001/02Interest rate hedges 1,061.9 1,086.6 (90.6) (57.6) – 0.0Currency hedges 54.1 143.8 2.2 (0.8) 3.0 1.3Product price hedges 37.6 14.1 (4.1) (0.1) 0.3 0.2Total 1,153.6 1,244.5 (92.5) (58.5) 3.3 1.5Maturities of the currency derivatives and product derivatives are less than one year, and of the interest rate derivatives arebetween one and five years.The nominal volumes of a derivative hedge instrument are the imputed call amounts upon which the payments are calculated.The hedged transaction and risk is not the nominal value itself, but rather the related price or interest-rate change.F-26

Fair value is the amount that the Südzucker Group would have had to pay or would have received assuming thehedge transaction were realised at the end of the year. As the hedge transactions are only carried out using normalmarket tradable financial instruments, the fair values have been determined using quoted prices on exchangeswithout offsetting any possible value changes relating to the underlying transaction being hedged.Credit risks arise from the positive fair values of derivatives. These credit risks are minimised by only enteringinto financial derivative transactions with banks with first-class credit rankings.Changes in values of derivative transactions carried out to hedge future cash flows (cash flow hedges) are initiallyrecorded direct to a special reserve in shareholders’ equity and are only subsequently recorded in the incomestatement when the cash flow occurs. Their fair values at February 28, 2003 totalled a negative D 27.4 million.Changes in the fair values of interest rate derivatives originally used to hedge loans which have been repaid earlyare recorded direct to the statement of income.1.11 Contingent liabilities and other financial commitmentsFebruary 28 2003 2002D millionDiscounted bills 0.1 0.1Guarantees and letters of comfort 3.1 13.1Warranty commitments 1.6 2.5Total of lease payments up to 1 year 0.8 1.6Total of lease payments of 1 to 5 years 1.4 2.0Total of lease payments over 5 years 0.0 0.2Purchase order commitments for non-current assets 58.0 64.5F-27

Consolidated financial statements2. Notes to the statement of income2.1 SalesDetails of the sales of D 4,383.8 million (D 4,776.1 million) are set out under VII. segment reporting.2.2 Changes in work in process and finished goods inventories and internal costs capitalised2002/03 2001/02D millionChange in work in process and finished good inventories 21.0 (78.0)Internal costs capitalised 3.9 3.524.9 (74.5)2.3 Other operating income2002/03 2001/02D millionIncome from disposals of non-currentand current assets and from write-ups 16.1 15.7Income from storage cost credits 6.7 21.3Foreign exchange and currency translation gains 8.4 18.7Other income 98.7 94.6129.9 150.3Other income is mainly made up of income from the release of provisions and accrued liabilities, from costsre-charged, rental and lease income, and royalty income.F-28

2.4 Cost of materials2002/03 2001/02D millionCost of raw materials, consumables and suppliesand of purchased merchandise 2,523.2 2,451.9Cost of purchased services 178.9 143.42,702.1 2,595.32.5 Personnel expenses2002/03 2001/02D millionWages und salaries 407.3 542.5Social security, pension andwelfare expenses 118.7 141.8526.0 684.3Average number of employees during the year2002/03 2001/02Divided by groupWage earners 9,677 12,549Salaried staff 4,797 10,659Trainees 381 43014,855 23,638Divided by geographic areaGermany 4,058 9,503Other EU countries 5,180 5,845Eastern Europe 5,609 8,018Other foreign countries 8 27214,855 23,638The comparable number of employees for the previous year, adjusted to eliminate the Schöller Group, was 15,034.F-29

Consolidated financial statements2.6 Depreciation2002/03 2001/02D millionScheduled depreciationIntangible assets (excluding goodwill) 5.4 9.9Tangible assets 182.7 206.9188.1 216.8Impairment write-downsTangible assets 1.1 3.4189.2 220.2Of the total impairment write-downs of D 1.1 million, D 0.9 million relates to the sugar segment and D 0.2 million tothe special products segment.2.7 Other operating expenses2002/03 2001/02D millionProduction and supplementary levies 59.4 79.0Storage cost levy 0.0 24.9Losses on disposals of non-current assets and current assets 7.0 6.6Foreign currency and translation losses 10.7 17.3Rental and leasing expenses 25.6 60.3Other expenses 498.4 698.9601.1 887.0Other expenses are made up primarily of selling and administration costs. The decrease compared with the previousyear is primarily due to the lack of selling and administrative expenses for the Schöller Group, which were includedin the amounts for 2001/02.F-30

2.8 Restructuring costs and other itemsThe net expense from restructuring costs and exceptional items of D 33.0 million (D 3.1 million) is made up ofexpenses for a provision relating to the sale in 2001/02 of the shareholding in AW-Fresenius, needed as a resultof the fall in the Fresenius AG share price, and fair value changes in interest-rate derivatives. These expenses werepartly offset by gains on the disposal of shares in KWS Saat AG , Veurne and RT Réassurance.2.9 Amortisation of goodwillThe increase in regular amortisation of goodwill to D 72.5 million (D 29.9 million) was mainly due to the inclusion ofSLS Group, acquired in 2001/02, for the full year (two months in 2001/02).2.10 Financial expense, net2002/03 2001/02D millionIncome from other securities and loans included in financial assets 18.3 16.1[of which from affiliated companies] [0.0] [0.1]Other interest and similar income 17.4 40.1[of which from affiliated companies] [0.0] [0.6]Interest and similar expenses (105.9) (117.5)[of which to affiliated companies] [(1.9)] [(8.5)][of which interest expense in calculating pension provisions] [(21.0)] [(19.4)]Interest expense, net (70.2) (61.3)Income from investments 29.2 17.1[of which from affiliated companies] [1.6] [3.0][of which from associated companies] [27.8] [9.2]Income from investments 29.2 17.1Financial expense, net (41.1) (44.2)F-31

Consolidated financial statements2.11 Taxes on incomeIncome tax expense for 2002/03 decreased to D 58.3 million compared with D 106.8 million for the previousyear. Current income tax expense declined by D 12.9 million to D 89.3 million, and there was a net deferred taxcredit of D 31.0 million in 2002/03 (D 4.6 million deferred tax expense in 2001/02), partly due to a reduction inthe Belgian income tax rate from 40.2 % to 34.0 %.Deferred taxes are calculated on temporary differences between items in the group balance sheet and the balanceof the same items in the local tax balance sheet. Deferred tax liabilities of D 342.7 million relate primarily tomeasurement differences for items in non-current assets and inventories. Deferred taxes are calculated based onthe local tax rate (37.4 % for Germany). Deferred tax assets include D 6.2 million for tax loss carryforwards.A reconciliation of deferred taxes in the balance sheet and deferred taxes in the income statement is as follows:2002/03D millionChange in deferred tax assets in the balance sheet 4.0of which change in companies consolidated 0.0of which income 4.0Change in deferred tax liabilities in the balance sheet 51.2of which change in companies consolidated 18.0of which expense 33.2Change in deferred taxes charged or credited direct to equity (6.2)Deferred taxes per statement of income 31.0F-32

Reconciliation of earnings before income taxes to income tax expense:2002/03 2001/02D millionEarnings before taxes on income 373.7 387.9Theoretical tax rate 39.2 % 37.9 %Theoretical tax expense 146.5 147.0Change in theoretical tax rate as a result of:Different tax rate (17.5) (4.9)Tax reduction for tax-free income (71.7) (97.6)Tax increase for non-deductible expenses 31.2 95.0Deferred tax income due to change in Belgian tax rate (15.2) 0.0Other (15.0) (32.7)Taxes on income 58.3 106.8Effective tax rate 15.6 % 27.6 %The theoretical income tax rate of 39.2 % is calculated by using the corporation tax rate, increased from 25.0 % to26.5 % as a result of the flood victims solidarity surcharge, plus a solidarity surcharge of 5.5 % of the corporationtax charge, and municipal trade tax on income.2.12 Research and development expensesResearch and development expenses amounted to D 25.5 million (D 22.8 million).F-33

Consolidated financial statementsVI. Statement of cash flowsThe statement of cash flows, prepared in accordance with requirements set out in IAS 7, shows the change in cashand cash equivalents of the Südzucker Group from the three areas of operating, investing and financing activities.Gross cash flows from operating activities increased to D 580.2 million (D 551.0 million) and represents 13.2 %(11.5 %) of revenues. Cash outflows for tax payments totalled D 49.0 million (D 41.9 million), dividends received fromassociated companies included at equity and from other investments amounted to D 15.2 million (D 5.7 million).After considering changes in working capital, cash flow from operating activities amounted to D 408.5 million (D409.8 million).A total of D 160.3 million (D 1,489.8 million) was required to finance capital expenditures on non-current assets.Capital expenditures of D 206.5 million (D 218.8 million) for tangible and intangible non-current assets and of45.8 million (D 1,670.5 million, of which D 1,600.9 million for SLS) for financial assets, including the acquisition ofconsolidated subsidiaries, were partly offset by sales proceeds from disposals of D 136.3 million, most of whichrelated to sales of financial assets (D 112.2 million).Dividend distributions of D 119.8 million (D 233.1 million) mainly related to cash dividends paid to the shareholdersof Südzucker AG (2001/02: including a special dividend of D 143.0 million) and to minority interests in consolidatedsubsidiaries. Financial liabilities of D 147.5 million were repaid in 2002/03.F-34

VII. Segment reporting1. Business segments (primary segment reporting)The segment information has been presented in accordance with internal reporting within the Südzucker Group,with operations divided into the sugar and special products segments. In connection with the group’s strategicrestructuring, with the acquisition of the SLS Group and the disposal of the Schöller Group in 2001/02, the make-upof the segments was changed effective March 1, 2002, as follows: the sugar segment includes the core sugarbusiness in western and eastern Europe. The special products segment consists of the Palatinit, ORAFTI and starchdivisions, together with the activities of the Portion Pack, Surafti and Freiberger Groups.As set out in IAS 14.76, the previous year’s figures were reallocated to the new segments and the Schöller activities,included in the 2001/02 amounts, were eliminated to facilitate comparability.Segment results are measured by their operating profit, i.e. profits before restructuring costs and exceptional items,before amortisation of goodwill and interest and investment income and expense.Operating margin is calculated as the percentage of operating profit to sales. Transactions between segments(sales of D 66.6 million) are made at normal market conditions.Segment net assets consist of non-current assets less financial assets and working capital of the segment(inventories, trade receivables and other assets less trade account liabilities, other short-term liabilities andshort-term provisions and accrued liabilities). Segment liabilities consist of medium-term and long-term third-partyliabilities excluding financial debt. Capital expenditures and depreciation of tangible non-current assets includeadditions to and depreciation of tangible and intangible non-current assets (excluding goodwill). The investments infinancial assets also include acquisitions of consolidated subsidiaries.F-35

Consolidated financial statements2002/03 2001/02*Group Sugar Special Group Sugar SpecialproductsproductsD millionSales 4,383.8 3,359.2 1,024.6 3,680.0 2,758.2 921.8Operating profit 520.3 396.9 123.4 420.7 328.2 92.5Operating margin 11.9 % 11.8 % 12.0 % 11.4 % 11.9% 10.0%Segment assets 3,785.2 3,098.9 686.3 3,620.9 2,953.6 667.3Segment liabilities 924.8 868.4 56.4 901.2 847.3 53.9Expenditures on tangible assets 206.5 134.6 71.9 178.0 102.3 75.7Investments in financial assets 45.8 31.4 14.4 1,670.5 1,609.9 60.6Depreciation of tangible assets (189.2) (140.2) (49.0) (169.5) (125.0) (44.5)Employees 14,855 11,543 3,312 15,034 12,148 2,886* Excluding Schöller Holding.2. Geographic segments (secondary segment reporting)2002/03 2001/02*D millionSalesGermany 1,360.1 1,448.6Other EU countries 2,597.4 1,873.7Total EU countries 3,957.5 3,322.3Eastern Europe 402.9 339.1Other foreign countries 23.4 18.64,383.8 3,680.0Segment assetsTotal EU countries 3,478.6 3,361.8Eastern Europe 301.9 254.9Other foreign countries 4.7 4.23,785.2 3,620.9Expenditures on tangible assetsTotal EU countries 177.9 161.0Eastern Europe 28.6 17.0206.5 178.0* Excluding Schöller Holding.F-36

VIII. Other notes1. Related partiesA related party as defined in IAS 24 is Süddeutsche Zuckerrübenverwertungs-Genossenschaft eG, Stuttgart (SZVG),which holds a majority of the shares in Südzucker AG by means of its own holding of Südzucker shares and theshares held by it on trust for its co-operative members.Items recorded on the accounts held for SZVG in 2002/03 were mainly cash received from dividends and businesstransactions. There is an agreement to pay interest on the balances on these accounts at normal market rates.Assuming that the shareholders' annual general meeting approves the proposed dividend, the total remunerationof members of the executive board of Südzucker AG paid by the company and its subsidiaries amounted toD 4.9 million (of which variable D 1.3 million) and the total remuneration of the members of the supervisory boardamounted to D 1.0 million (variable). In addition, the members of the executive board and of the supervisory boardreceived further remuneration of D 0.4 million for carrying out management functions at various subsidiaries.A total of D 10.5 million has been provided in respect of pension obligations to former members of the executive boardand supervisory board and their dependent relatives. Payments made during the year amounted to D 1.1 million.There were no advances or loans to members of the executive board on February 28, 2003. D 30,700 were repaidduring 2002/03.2. Earnings per share2002/03 2001/02Earnings for the year (excluding minority interests) in D million 259.4 231.9Number of shares 170,339,088 160,182,610Earnings per share in I 1.52 1.45The calculation has been made in accordance with requirements set out in IAS 33.In 2002/03, the number of shares was reduced by the shares as set out in § 160 para. 1 Stock Corporation Law.F-37

Consolidated financial statements3. Supervisory board and executive boardSupervisory boardDr. Hans-Jörg GebhardChairmanEppingenChairman of the Association ofSüddeutsche Zuckerrübenanbauer e. V.Other memberships of domestic,statutory supervisory boards:Südzucker GmbH, Zeitz (chairman)VK Mühlen AG, HamburgMemberships of comparable domesticand foreign supervisory bodies:AGRANA Beteiligungs-AG, Vienna, AustriaSaint Louis Sucre S.A., Paris, FranceSZVG Süddeutsche Zuckerrübenverwertungs-Genossenschaft eG,Ochsenfurt (chairman)Franz-Josef Möllenberg*Deputy chairmanRellingenChairman of theFood and Catering UnionDr. Ulrich WeissDeputy chairmanKronberg, TaunusFormer member of the executive board of Deutsche Bank AGOther memberships of domestic,statutory supervisory boards:ABB Asea Brown Boveri AG, MannheimBEGO Medical AG, BremenContinental AG, HanoverHeidelberg Cement AG, HeidelbergO & K Orenstein & Koppel AG, Berlin (chairman)Memberships of comparable domesticand foreign supervisory bodies:BENETTON S.p.A., Ponzano, ItalyDUCATI S.p.A, Bologna, ItalyPiaggio S.p.A., Pontedera, ItalyHeinz Christian BärKarben – Burg GräfenrodeVice president of the Deutscher Bauernverband e.V.Memberships of comparable domesticand foreign supervisory bodies:Landwirtschaftliche Rentenbank, Frankfurt/MainLBH Steuerberatungsgesellschaft mbH, FriedrichsdorfVereinigte Hagelversicherung VVAG, GießenGerlinde Baumgartner*OsterhofenMember of the works council of the Plattling worksSüdzucker AG Mannheim/Ochsenfurtfrom August 22, 2002Robert Bausewein*OchsenfurtMember of the works council of the Ochsenfurt worksand head officeSüdzucker AG Mannheim/OchsenfurtMarch 19 through August 22, 2002Dr. Ulrich BrixnerDreieichChairman of the executive board of DZ BANK AGOther memberships of domestic,statutory supervisory boards:Karlsruher Lebensversicherung AG, KarlsruheMemberships of comparable domesticand foreign supervisory bodies:Banco Cooperativo Español, Madrid, SpainSZVG Süddeutsche Zuckerrübenverwertungs-Genossenschaft eG,OchsenfurtGroup company board memberships:Bausparkasse Schwäbisch Hall AG, Schwäbisch Hall(deputy chairman)DG HYP Deutsche Genossenschafts-Hypothekenbank AG,Hamburg (chairman)DZ BANK plc., Dublin, Ireland (chairman)R + V Versicherung AG, Wiesbaden* Employee representative.F-38

Rolf Bucher*OffenauMember of the works council of the Offenau worksSüdzucker AG Mannheim/OchsenfurtMarch 19 through August 22, 2002Helmut Drescher*WattenheimChairman of the works councilSüdzucker AG Mannheim/OchsenfurtLudwig EidmannGroß-UmstadtChairman of the Association of theHessen-Nassauischen Zuckerrübenanbauer e.V.from August 22, 2002Walter Erhard*RegensburgDeputy chairman of the works councilSüdzucker AG Mannheim/Ochsenfurtto August 22, 2002Manfred Fischer*FeldheimDeputy chairman of the works councilSüdzucker AG Mannheim/Ochsenfurtfrom August 22, 2002Paul FreitagOberickelsheim-RodheimChairman of the Association ofFränkische Zuckerrübenbauer e. V.Other memberships of domestic,statutory supervisory boards:Freiberger Lebensmittel GmbH & Co. Produktions- undVertriebs KG, BerlinMax Fröschl*AholmingChairman of the works council of the Plattling worksSüdzucker AG Mannheim/OchsenfurtMarch 19 through August 22, 2002Hans Hartl *ErgoldingState area chairman of theFood and Catering Union in BavariaOther memberships of domestic,statutory supervisory boards:Philip Morris GmbH, MunichSüdfleisch Holding AG, Munich (deputy chairman)Klaus Kohler*Bad FriedrichshallChairman of the works council of the Offenau worksSüdzucker AG Mannheim/Ochsenfurtfrom August 22, 2002Dr. Christian KonradViennaChairman of the supervisory board ofAGRANA Beteiligungs-AG, ViennaOther memberships of domestic,statutory supervisory boards:BayWa AG, MunichMemberships of comparable domesticand foreign supervisory bodies:Saint Louis Sucre S.A., Paris, FranceSiemens Österreich AG, Vienna, AustriaSZVG Süddeutsche Zuckerrübenverwertungs-Genossenschaft eG,OchsenfurtGroup company board memberships:AGRANA Beteiligungs-AG, Vienna, Austria (chairman)BIBAG AG, Vienna, AustriaDo & Co AG, Vienna, AustriaErste Niederösterreichische Brandschaden-Versicherungs AG,Vienna, AustriaKURIER Zeitungsverlag und Druckerei Gesellschaft m.b.H.,Vienna, Austria (chairman)Leipnik-Lundenburger Invest Beteiligungs AG, Vienna, Austria(chairman)Mediaprint GmbH & Co. KG, Vienna, Austria (chairman)Raiffeisen Holding Niederösterreich Wien reg. Gen.m.b.H., Vienna,Austria (chairman)Raiffeisen Landesbank Niederösterreich Wien AG, Vienna, Austria(chairman)Raiffeisen Ware Austria AG, Vienna, AustriaRaiffeisen Zentralbank Österreich AG, Vienna, Austria (chairman)RWA Raiffeisen Ware Austria Handel und Vermögensverwaltungregistrierte Genossenschaft mit beschränkter Haftung, Vienna,AustriaUniqa Versicherungen AG, Vienna, Austria (chairman)F-39

Consolidated financial statementsJörg Lindner*HamburgDivisional officer of the Food and Catering UnionOther memberships of domestic,statutory supervisory boards:Nestlé Deutschland AG, Frankfurt/MainNestlé Schöller GmbH & Co. KG, NurembergUlrich MüllerIllsitzChairman of the Association of theSächsisch-Thüringischer Zuckerrübenanbauer e. V.Other memberships of domestic,statutory supervisory boards:Südzucker GmbH, ZeitzMemberships of comparable domesticand foreign supervisory bodies:Raiffeisenwarengesellschaft mbH, GößnitzSZVG Süddeutsche Zuckerrübenverwertungs-Genossenschaft eG,Ochsenfurt (deputy chairman)Erich Muhlack*RegensburgManager of the Plattling, Rain and Regensburg worksSüdzucker AG Mannheim/OchsenfurtMemberships of comparable domesticand foreign supervisory bodies:BGD Bodengesundheitsdienst GmbH, MannheimREKO Erdenvertrieb GmbH, MannheimGunter Schneickert*OffsteinChairman of the works council of the Offstein worksSüdzucker AG Mannheim/OchsenfurtMarch 19 through August 22, 2002Klaus Viehöfer*GranaMember of the works council of the Zeitz worksSüdzucker GmbHfrom August 22, 2002Other memberships of domestic,statutory supervisory boards:Südzucker GmbH, ZeitzErnst WechslerWesthofenChairman of the Association ofHess.-Pfälzische Zuckerrübenanbauer e. V.Roland Werner*SaxdorfChairman of the works council of the Brottewitz worksSüdzucker GmbHfrom August 22, 2002Gerhard R. WolfWormsFormer member of the executive board of BASF AGto August 22, 2002Other memberships of domestic,statutory supervisory boards:Hornbach Holding AG, Bornheim (chairman)Hornbach Baumarkt AG, Bornheim (chairman)K + S AG, Kassel (chairman)K + S Kali GmbH, Kassel (chairman)STINNES Aktiengesellschaft, Mülheim/RuhrRichard SchwaigerAiterhofenChairman of the Association ofBayerische Zuckerrübenanbauer e. V.Memberships of comparable domesticand foreign supervisory bodies:AGRANA Beteiligungs-AG, Vienna, AustriaF-40

Executive boardDr. Theo Spettmann (Spokesman)Memberships of domestic,statutory supervisory boards:Berentzen-Gruppe AG, Haselünne (chairman)Fresenius Medical Care AG, Hof, SaaleGerling Industrie Service AG, CologneKarlsruher Versicherung AG, KarlsruheGroup company board memberships:AIH Agrar-Industrie-Holding GmbH, Mannheim (chairman)Freiberger Lebensmittel GmbH & Co. Produktions- undVertriebs KG, BerlinRaffinerie Tirlemontoise S.A., Brussels, BelgiumSaint Louis Sucre S.A., Paris, France (chairman)Südzucker Verkauf GmbH, OberurselSüdzucker International GmbH, OchsenfurtSüdzuckergroup Export Centre S.A., Brussels, Belgium(chairman)Albert DardenneGroup company board memberships:AGRANA Internationale Verwaltungs- und Asset-Management AG, Vienna, AustriaCandico N.V., Antwerp, BelgiumEnsemble Participations S.A.S., Paris, FranceFinancière Franklin Roosevelt S.A.S., Paris, FrancePortion Pack Europe Holding B.V., Oud-Beijerland,The NetherlandsRaffinerie Notre-Dame S.A., Oreye, BelgiumRemy Industries N.V., Wijgmaal-Leuven, BelgiumSaint Louis Sucre S.A., Paris, FranceDr. Christoph KirschGroup company board memberships:AGRANA Beteiligungs-AG, Vienna, AustriaBETA Beteiligungs GmbH, Mannheim (chairman)Financière Franklin Roosevelt S.A.S., Paris, FranceFreiberger Lebensmittel GmbH & Co. Produktions- undVertriebs KG, BerlinRaffinerie Tirlemontoise S.A., Brussels, Belgium (chairman)Südzucker International GmbH, OchsenfurtSüdzucker Verkauf GmbH, Oberursel (chairman)Südzucker Versicherungs-Vermittlungs-GmbH, Mannheim(chairman)Zuckerfabrik Ropczyce, Ropczyce, PolandDr. Klaus KornMemberships of comparable domesticand foreign supervisory bodies:Kerevitas A.S., Istanbul, TurkeyGroup company board memberships:Palatinit Asia Pacific Pte Ltd., SingaporeRaffinerie Tirlemontoise S.A., Brussels, BelgiumSaint Louis Sucre S.A., Paris, FranceSüdzucker GmbH, ZeitzSüdzucker International GmbH, OchsenfurtSüdzucker Versicherungs-Vermittlungs-GmbH, MannheimZuckerfabrik Ropczyce, Ropczyce, PolandJohann MarihartMemberships of comparable domesticand foreign supervisory bodies:BBG Bundesbeschaffungsges.m.b.H., Vienna, AustriaLeipnik-Lundenburger Invest Beteiligungs AG, Vienna, AustriaÖsterreichische Nationalbank, Vienna, AustriaOttakringer Brauerei AG, Vienna, Austriatop.equity Unternehmensbeteiligungs AG, Vienna, AustriaTÜV Österreich, Vienna, Austria (president)Group company board memberships:AGRANA Internationale Verwaltungs- und Asset-Management AG, Vienna, Austria (chairman)AGRANA Zucker und Stärke AG, Vienna, Austria (chairman)EHCF Kft., Acs, Hungary (chairman)Magyar Cukor Rt., Budapest, HungaryMoravskoslezské Cukrovary a.s., Hrusovany, the Czech Republic(chairman)Österreichische Rübensamenzucht GmbH, Tulln, Austria(chairman)Raffinerie Tirlemontoise S.A., Brussels, BelgiumSaint Louis Sucre S.A., Paris, FranceZuckerforschung Tulln GmbH, Tulln, Austria (chairman)Dr. Rudolf MüllerMemberships of domestic,statutory supervisory boards:VK Mühlen AG, HamburgGroup company board memberships:AGRANA Beteiligungs-AG, Vienna, Austria (deputy chairman)BGD Bodengesundheitsdienst GmbH, Mannheim (chairman)Raffinerie Tirlemontoise S.A., Brussels, BelgiumREKO Erdenvertrieb GmbH, Regensburg (chairman)Saint Louis Sucre S.A., Paris, FranceSüdzucker GmbH, ZeitzSüdzucker International GmbH, Ochsenfurt (chairman)Zuckerfabrik Ropczyce, Ropczyce, Poland (chairman)Frédéric RostandMemberships of comparable domesticand foreign supervisory bodies:Ebro Puleva S.A., Madrid, SpainGroup company board memberships:COFA (Compagnie Financière de l’Artois), Marconne Hesdin,FranceDistilleries Ryssen, Marconne Hesdin, FranceEastern Sugar BV, Deurne, HollandRaffinerie Tirlemontoise S.A., Brussels, BelgiumSociété Nouvelle des Sucreries de Chalon-sur-Sâone S.A.,Chalon-sur-Sâone, FranceF-41

Consolidated financial statements4. Significant investments of the Südzucker GroupThe significant investments are listed by sub-group.Südzucker AGSüdzucker IndirectLocation Country share holdingPalatinit GmbH 1) Mannheim 100.00Südzucker GmbH 1) Zeitz 100.00Südzucker International Finance B.V. Amsterdam The Netherlands 100.00Südzuckergroup Export Centre S. A. Brussels Belgium 51.00 49.00Zschortauer Feldfrucht GmbH Zschortau 51.00Wolteritzer Agrar GmbH Schkeuditz 74.80Cukrownia Lubna S. A. Kazimierza Wielka Poland 75.40Cukrownia Ropczyce S. A. Ropczyce Poland 51.63Cukrownia Wlostów S. A. Wlostów Poland 81.25Cukrownia Garbów S. A. Garbów Poland 92.03Cukrier Królewski Krakau Poland 100.00Cukrownia Strzyżów S. A. Strzyżów Poland 81.24Fabrica de Zahar Alexandreni S. A. 2) Alexandreni Moldova 36.00Südzucker Moldova S. A. Drochia Moldova 61.21BGD BodengesundheitsdienstGesellschaft mbH 1) Mannheim 100.00REKO Erdenvertrieb GmbH 1) Regensburg 100.00Mönnich GmbH & Co. KG Kassel 71.43 28.57AIH Agrar-Industrie-Holding GmbH Mannheim 50.00Beta Beteiligungs GmbH Mannheim 43.19Z & S Zucker und Stärke Holding AG Vienna Austria 50.00Raffinerie Tirlemontoise S. A. Belgium 85.41Sucres de Tirlemont S. A. Tienen Belgium 100.00Hottlett Sugar Trading S. A. Berchem Belgium 62.55Candico S. A. Merksem Belgium 75.50ORAFTI Oreye S. A. Oreye Belgium 99.89Remy Industries NV Wijgmaal Belgium 100.00Cocachoc NV Herentals Belgium 100.00Suikers G. Lebbe S. A. Oostkamp Belgium 99.88Portion Pack European Holding B.V. Oud Beijerland The Netherlands 33.00 67.00Atlanta Dethmers Beheer BV Groningen The Netherlands 100.00James Fleming & Co. Ltd. Newbridge Scotland 100.00Sugarfayre Limited Ashington England 100.00W. T. Mather Ltd. Ashton England 100.00Groupe Nougat Chabert & Guillot Montélimar France 100.00F-42%

Südzucker IndirectLocation Country share holdingSaint Louis Sucre S. A. France 85.19Saint Louis Sucre S.N.C. Paris France 100.00Sociétè Nouvelle des Sucreries de Chalon Chalon-sur-Sâone France 49.99Sucrerie et Distillerie de Souppes-Ouvré Fils S. A. Paris France 44.48Eastern Sugar BV Deurne Holland 50.00Ebro Puleva S. A. Madrid Spain 14.19%AGRANA Beteiligungs-Aktiengesellschaft 3) Austria 44.87AGRANA Zucker und Stärke AG Vienna Austria 100.00Magyar Cukorgyártó és Forgalmazó Kft. Budapest Hungary 88.04Moravskoslezské Cukrovary A.S. Hrusovany The Czech Republic 97.54S.C. Danubiana Roman S. A. Roman Romania 92.16S.C. Zaharul Romanesc S. A. Buzau Romania 86.51Slovenské Cukrovany a.s. Rimavská Sobota Slovakia 100.00HUNGRANA Keményitö- és Isocukorgyártóés Forgalmazó Kft. Szabadegyhaza Hungary 50.00AGFD Tandarei S.C. Tandarei Romania 99.97Freiberger GroupFreiberger Lebensmittel GmbH & Co. Prod.-/Vertr. KG Berlin 100.00PrimAS Tiefkühlprodukte GmbH Oberhofen Austria 100.001)Exemption from publishing financial statements per § 264 para. 3 HGB.2)Controlling influence per contractual agreement.3)Majority of voting share.5. Corporate governance codeThe declaration of compliance with the German corporate governance code, as set out in § 161 Stock CorporationLaw, was submitted by the executive board and supervisory board and is available to shareholders on our Internethomepage at http://www.suedzucker.de.F-43

Consolidated financial statementsIX. Proposed appropriation of earningsIt will be proposed to the annual general meeting that a dividend of D 0.50 per share (2001/02: D 0.47 per share)be distributed and hence that the retained earnings of Südzucker AG Mannheim/Ochsenfurt of D 87,437,861.19 beappropriated as follows:in DDistribution of a dividend of H 0.50 per share on 174,787,946 ordinary shares 87,393,973.00Earnings carried forward 43,888.19Unappropriated earnings 87,437,861.19The dividend will be paid on August 1, 2003.Mannheim, May 12, 2003THE EXECUTIVE BOARDDr. Spettmann Dardenne Dr. Kirsch Dr. Korn Marihart Dr. Müller RostandThe financial statements of Südzucker AG, prepared in accordance with German accounting principles and uponwhich KPMG Deutsche Treuhand-Gesellschaft Aktiengesellschaft Wirtschaftsprüfungsgesellschaft, Mannheim, hasissued an unqualified auditors’ report, will be published in the Federal Gazette and will be filed with the commercialregister of the district court of Mannheim. It can be received from the company on request.F-44

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MANAGEMENT REPORT (LAGEBERICHT) FOR THE FINANCIAL YEAR ENDED FEBRUARY 28, 2003Foreword by the executive boardDear shareholders,Südzucker is currently by far the largest European sugar enterprise and is market leaderboth in the European Union and in the countries of eastern Europe. Focussing on our corebusiness, sugar, and the dynamic growth of the special products segment give the groupthe energy to work successfully, even in difficult conditions. The rigorous and rapidimplementation of our business strategy has already yielded successful results in 2002/03.This was most clearly shown by an increase of 11.9 % in operating income to D 520 million(D 465 million) and of 12.2 % in net earnings to D 315 million (D 281 million). Südzuckerwas thus able to increase its operating margin to 11.9 % (9.7 %). We clearly demonstratedour cash-generating ability by increasing cash flow to D 580 million (D 551 million).Earnings per share of D 1.52 (D 1.45) also underlines the success of the group's newstructural direction.Following the strategic emphasis in 2001/02 on re-focussing our activities, the mainthrust in the past year was in taking measures to secure and improve the profitability ofthe sugar and special products segments. One important change was an extensivereorganization of the group structure, accompanied by a broadly-based, critical analysisof workflows and production processes. Overall, this review has led further integration ofour operations, increased efficiency and an improved market position.For example, we have established a powerful marketing organization with the ability tocare for our customers’ specific needs throughout the group. A substantial challenge layin offsetting the negative effects on our export business of conditions on the world sugarmarket. The group’s expanded and improved co-operation within the framework of ourexisting Südzucker Export Centre strengthened our market position. Our clear groupstructure enables new business activities to be incorporated smoothly and ensuresmaximum operating flexibility wherever our customers are located.In addition to marketing, we have also carefully reviewed group-wide other key processes,such as research and development and production, identified opportunities of optimisingthese processes and have introduced the changes needed to improve efficiency andF-46

profitability. Our research and development activities are networked throughout theEuropean Union, with a high degree of coordination and cooperation between our mainR&D centers. Our researchers’ ambitions and our long-term group strategy are thatSüdzucker should achieve a high rate of innovation, continuing to contribute to expandingour market share and maintaining our profitability in the future. We aim to establish aproduct portfolio for the sugar and special products segments covering functional,individual items as well as integrated systems solutions for our customers. We areoccupying further market niches with an expanded range of tailored products, partlydeveloped jointly with our customers.The restructuring program relating to the sugar segment’s production locations wascompleted in Germany with the closure of the Löbau works at the end of the 2002campaign, together with capital expenditures to raise capacity at other locations. It is notcurrently possible to predict whether additional restructuring programs will be neededdue to further export restrictions or deterioration in overall conditions.After a delay of several years, on March 26, 2003 the Polish state treasury ministry approvedthe sale of Slaska Spolka Cukrowa (SSC), the Silesian sugar group, to Saint Louis SucreGroup, part of the Südzucker Group. Thus, as planned, Südzucker has strengthened itsexisting position in Poland and has achieved its objectives of reaching a market share of25 %. After France and Germany, Poland is the third largest European sugar producer and,with some 40 million inhabitants, is the most important market of all the central Europeancountries. Thus, even before Poland joins the European Union in 2004, Südzucker hasbeen able to supplement the group’s six existing factories located in eastern Poland withfourteen Silesian sugar factories. In future, our newly-established group in Poland will bethat country’s second-largest sugar company, with an EU quota of 422,000 tonnes ofsugar and sales of some D 300 million. The new grouping will simplify a restructuring ofthe neighboring Silesian and eastern Polish sugar factories needed for EU membershipand will provide synergies in procurement, production, administration and marketing.As part of its concentration on its core business activities, Südzucker has sold all itsshares in VK Mühlen AG, Hamburg, held via AIH Agrar-Industrie-Holding, to Leipnik-Lundenburger Invest Beteiligungs AG, a subsidiary of Raiffeisen-Holding Niederösterreich-Wien, VK Mühlen AG has thus gained a further strong partner in the European flour market.F-47

Foreword by the executive boardSüdzucker has a call option on 15 % of KWS shares with Bayer CropScience. As, byantitrust law, Südzucker cannot currently increase its holding in KWS above 25 %, it hassold in advance the same number of KWS shares from its existing holding.The special products segment, which provides almost a quarter of group sales, alsoprogressed well. This segment’s success is based on a strong customer orientation, aworldwide presence with a global marketing network and a highly-qualified, applicationsbasedadvisory service. The segment’s products are met in many walks of life, mostly asadditives in high-quality foodstuffs, but also as frozen foods such as pizzas, as portionpackarticles in catering, or as non-food, starch-based products. Based on our high levelof innovation in this area we also expect double-digit growth in the medium term. Inorder to achieve this goal, we have combined Palatinit and ORAFTI organizationally toform a functional food products division. Hence, potential synergies from theiroverlapping customer base as well as in the research area can be better utilized. As wellas maintaining the body’s performance, functional food products also have a beneficialeffect on health and are increasingly seen as a way of improving the quality of life. Inorder to take advantage of this trend, Südzucker has developed a high level ofcompetence in evaluating the physiological requirements in food, particularly alsoregarding emotional views of foodstuffs. The key products for establishing a leadingmarket position in this segment are Isomalt, the sugar-free sweetener extracted from sugarbeet, and RAFTILINE® and RAFTILOSE®, obtained from chicory root.Constant innovation is also the key to our success in the starch division, where we areoccupying new and interesting market niches.This also applies to our Portion Pack Europe (PPE) activities, with portion-pack itemssupplied to the catering industry and wholesalers. Synergies have been extracted followingthe acquisition of Cocachoc, the Belgium company, and PPE became market leader inthe chocolate and biscuit portion-pack segment.When viewing the broad base of Südzucker group’s operations, it is clear that focussingon our core competencies was a step forward, freeing existing resources within thegroup to find their full potential.We are intensively examining the potential for producing bio-ethanol for use as a fuel,and this could develop into a new business activity. The raw materials would be sugarF-48

eet and grain, from which energy-saving bio-ethanol can be produced at a plant locatednext to a sugar factory. We already have the technology for this process and it is beingused successfully by our French company, Saint Louis Sucre. We understand theproduction side of the project, but there are sales-side risks due to limited tax-freeexemption for bio-ethanol expiring in 2008, competition from imports from othercountries and the development of demand.A major aspect in our considerations is the interest of our shareholders. We see quality,safety, health and the environment as fundamental building blocks for continuing growthand increasing the value of Südzucker Group. As part of our relentless pursuit ofsustained growth for the group, we have set up a group-wide system enabling us to takean integrated view, from agricultural production through to the end-product. As well as along-term group strategy, high standards of corporate governance are a major conditionfor maintaining the trust of our shareholders. Hence, in January 2003 Südzucker adaptedthe standing procedural rules for the supervisory board and executive board and thusmatch the recommendations of the German corporate governance code established bygovernment commission.In December 2002 Deutsche Bank placed 6.1 % of its Südzucker shares with existingshareholders. Our Austrian shareholders acquired 4.5 % via ZSG NL (Netherlands) B.V.and thus hold 10 % of Südzucker, and Süddeutsche Zuckerrübenverwertungs-Genossenschaft eG (SZVG) increased its shareholding by 1.6 % to 56 %.We have achieved an excellent position in key markets and major new product areasand look to the future with self-assurance and confidence, particularly in these turbulenttimes for the sugar and food industry. We have described the discussion on the futureformat of the sugar market regulation, which has been prolonged through mid-2006, asfrom page 33 of this report. We take up the challenges facing us, make those changesneeded and use all opportunities available to us, relying on our talented andentrepreneurial staff and the trust of our shareholders.Sincerely,SÜDZUCKER AG Mannheim/OchsenfurtThe executive boardF-49

Highlights from the group financial statementsGroup sales and profitsThe pattern of Südzucker Group sales were influencedby the disposal of the Schöller Group and theacquisition of Saint Louis Sucre (SLS). The decreaseof D 392 million in group revenues to D 4,384 million(D 4,776 million) was primarily due to the changein companies consolidated in the group. The declinein turnover of D 1,096 million (9 months 2001/02)due to the disposal of Schöller could not be fullyoffset by revenues of D 903 million (2 months2001/02: D 129 million) from Saint Louis Sucre, whichwas included for a full year for the first time. Afteradjusting for the acquisition of Saint Louis Sucre, thesugar segment suffered a decrease in sales, mainlydue to lower C-sugar turnover. Due to the short 2001campaign, there were lower quantities available forworld exports, and these had to be marketed in theteeth of declining world sugar prices. There werelower sugar revenues from quota sugar quantitiessold, due to the declassification of quota sugarquantities by the EU. The special products segmentagain achieved a satisfactory performance, witha jump in revenues of 11.2 % to D 1,025 million(D 922 million), mainly through internal growth.Group operating profits increased by 11.9 % toD 520 million (D 465 million). Thus, in a difficulteconomic environment, the Südzucker Group hasnot just held up well, but has achieved a sustainedimprovement to its earnings quality, with operatingmargin rising from 9.7 % to 11.9 %.Segment reporting was adjusted effective March 1,2002. The sugar segment includes the sugar activitiesin western and eastern Europe. The special productssegment includes the Palatinit, ORAFTI and starchdivisions as well as the Portion Pack, Surafti andFreiberger Group activities. The previous year’s figureshave been reclassified to the new segments and,to improve comparability, have been adjusted toChange in salesin D billion1987/88 0.71988/89 1.41989/901990/911.82.31991/92 2.51992/93 2.71993/94 2.71994/95 3.21995/96 3.81996/97 3.91997/98 4.21998/99 4.51999/20002000/014.54.72001/02 4.82002/034.4eliminate the Schöller activities, which were includedlast year.Operating profits for the sugar segment rose by21 % to D 397 million (D 328 million). This increasewas primarily due to the first-time full consolidationof SLS which, as expected, proved its earningscapabilities. Developments in the other EU countries(excluding SLS) were influenced by the poorer sugarexport business. Results of the eastern Europeansugar activities varied, with different countriesperforming unevenly. Whereas in some countriesoperating margins have already reached EU levels, inparticular the situation on the Polish domestic sugarmarket weighed on results prior to Poland’s entry tothe EU on May 1, 2004. Operating results of theF-50

Change in operating profitin D million1987/881988/891989/901990/911991/921992/931993/941994/951995/961996/971997/981998/991999/2000 3292000/012001/0235671111622352562212152422592793083924652002/03 520AGRANA subsidiaries in eastern Europe werepositively affected by changing the financial year toa uniform twelve months to February 28.return on capital employed (ROCE) of the special productssegment of 16.0 % comfortably exceeded 10.9% for the sugar segment.Expenses from restructuring and exceptional items ofD 33 million (D 3 million) mainly relate to provisionsin connection with the sale of AW-Fresenius sharesin 2001/02, required due to the decrease in theFresenius AG share price. The sale of part of theinvestment in KWS, reducing the holding fromalmost 25 % to nearly 10 %, helped to reduce thesecosts. Scheduled amortisation of goodwill increasedby D 43 million to D 73 million (D 30 million)following the first-time inclusion of SLS.Financial results improved by D 3 million to netexpense of D 41 million (D 44 million). Thedeterioration of D 9 million in net interest expenseto D 70 million (D 61 million) was more than offset bya sharp improvement of D 12 million in investmentincome to D 29 million (D 17 million), mainly fromSLS investments. The effective income tax rate couldbe reduced to 15.6 % (27.6 %), with a drop in theBelgian tax rate from 40.2 % to 34.0 % and tax-freegains arising from one-time effects being responsiblefor the decrease of D 49 million in income taxexpense to D 58 million (D 107 million).The special products segment achieved a growth of33.4 % in operating profits to D 123 million (in theprevious year excluding Schöller: D 93 million).This segment thus meanwhile contributes almost aquarter of group turnover and profits. The increasein profits was achieved both through targetedacquisitions, particularly with the purchase of RemyIndustries in the ORAFTI division, as well ascontinued internal growth in all divisions making upthe special products segment. The operating marginfor this segment overtook the sugar segment for thefirst time, at 12.0 % (sugar segment: 11.8 %). TheGroup net earnings after tax, which rose by 12.2 %,or D 34 million, from D 281 million to D 315 million,reflect the full integration of the SLS Group, whichwas completed in 2002/03.Earnings per share rose to D 1.52 (D 1.45); thisdemonstrated once again that there was no earningsdilution, despite the additional shares issued inconnection with the capital increase. On the contrary,Südzucker Group’s earnings power has actually risen.F-51

Highlights from the group financial statementsBalance sheetAt D 5,826 million, Südzucker Group’s total assets atFebruary 28, 2003 were slightly down on the previousyear’s D 5,843 million. Non-current assets decreasedby D 66 million to D 3,237 million (D 3,303 million),due to disposals, including the sale of 15 % of theKWS shareholding. Current assets rose by D 49 millionto D 2,589 million (D 2,540 million), mainly due toincreased sugar inventories at February 28, 2003following the high level of sugar production duringthe 2002 campaign. Group shareholders’ equityincreased by D 211 million to D 2,221 million (D 2,010million), which resulted in a higher ratio ofshareholders’ equity to total liabilities and shareholders’equity, up to 38.1 % (34.4 %). Net financial debtdecreased by D 134 million to D 1,008 million (D 1,142million), which represents 1.7 times cash flow ofD 580 million. With operating profits exceeding 7.4times net interest expense and shareholders’ equityand medium- and long-term liabilities covering noncurrentassets by 124.6 % (119.2 %), Südzucker Group’sbalance sheet has improved on its existing soundfinancial ratios even after the full integration of SLS.Change in cash flowin D million1987/88 731988/89 1391989/901990/912142621991/92 2991992/93 3041993/94 3091994/95 3711995/96 4101996/97 4371997/98 4801998/99 4641999/20002000/014724982001/02 5512002/03 580Statement of cash flowCash flow improved by D 29 million to D 580 million(D 551 million) in 2002/03, representing cash flowas a percentage of sales of 13.2 % (11.5 %). Capitalexpenditures on tangible and intangible non-currentassets were slightly lower than for the previous year,at D 207 million (D 219 million). In the sugar segment,the full integration of the SLS Group (2 months ofthe previous year) led to a rise in capital expendituresto D 135 million (D 102 million). In the special productssegment, capital expenditures were D 4 million belowthe previous year’s amount, at D 72 million (D 76million excluding Schöller). They were primarily forexpanding capacity, including of Isomalt productionat Offstein and of ORAFTI production at Oreye.Investments in financial assets, last year consistingmainly of D 1,601 million for the acquisition ofSaint Louis Sucre, France, amounted to D 46 millionfor 2002/03 and related primarily to the specialproducts segment. The profit distribution in 2002/03of D 120 million (D 233 million) includes the dividendof D 82 million paid out by Südzucker AG in August2002. In 2001/02 the distribution was affected bya dividend made in the form of a distribution andreinvestment program. With special distributions in2000 and 2001 totaling D 215 million, Südzucker fullypassed on the tax rebates from the old corporationtax credits to its shareholders. The worsenedconditions for these corporation tax credits arisingfrom the 2003 Tax Relief Reduction Law thus had nonegative effects for the Südzucker shareholder.F-52

Recommendation on appropriation of profitsThe executive board and supervisory board willrecommend an increase in the dividend from D 0.47per share to D 0.50 per share to the annual generalmeeting on July 31, 2003; this is in line withSüdzucker’s results-related dividend policy. Theamount to be distributed will thus rise by D 5.2million, from D 82.2 million to D 87.4 million. Thedividend will be paid on August 1, 2003 and hencesome three weeks earlier than last year.Outlook for 2003/04With low world-market prices, a weak dollar andunstable development of eastern European sugarmarkets before entry to the EU, the sugarenvironment for 2003/04 will be difficult. Weconsider that there will be a weaker operating profit,whereby we reckon with higher net earnings for theyear.F-53

Südzucker shareShare price movementInvestors in equities had to suffer considerable losseson all the large stock markets of the world for thethird year running since 2000. This was mainly dueto significant weakness in growth of the world'seconomy, strengthened by uncertainties andconsumer reticence, and not least to developments inthe Middle East. Further interest rate cuts by theAmerican and European central banks could notstop the DAX dropping by 50 % to 2,547 points inthe period from March 1, 2002 through February 28,2003, the MDAX decreasing by 35 % to 2,843 points.The Südzucker share performed relatively well incomparison, with the share price declining by 14 %to D 14.60. After considering the dividend distribution,the overall decline was 11 %.Price movement of the Südzucker share in comparison to DAX/MDAX(Indexed)Index110100908070605040SüdzuckerMDAXDAXMarch2002 2002 April2002 May2002 June2002 July2002Aug. Sept. Nov. Dec. Jan.2002 2002 2003 2003 Feb. March2002 2002Oct.2003 2003AprilLong-term increase in valueassuming re-investment of dividend(excluding tax credit) and rightsValue in D thousands70605040302010028.02.1989 28.02.1991 28.02.1993 28.02.1995 28.02.1997 28.02. 28.02. 28.02.1999 2001 2003Long-term increase in valueWith an average annual return of 12.3 % since March1,1988 (beginning of the financial year in which themerger with Zuckerfabrik Franken took place), theSüdzucker share again performed better than theDAX, with 5.9 % p. a. or the MDAX, at 6.8 % p. a.Excluding capital increases, a portfolio of Südzuckershares with an equivalent value of D 10,000 invested15 years ago, at the beginning of 1988/89, wouldhave risen to D 57,100 on February 28, 2003, due toan increase in the share price, reinvested dividendsand pre-emptive rights. Over the long-term, thisdemonstrates that the Südzucker shareholder canview Südzucker as a sound investment even indifficult times on the stock markets.Price movement of the Südzucker shareFrom March 2002 to April 2003in D19181716151413March2002 2002 April2002 May2002 June2002 July2002Aug.Nov. Dec. Jan.2002 2002 2003 2003 Feb. March20022003 2003AprilSept.2002 Oct.Investor relationsOur intensive dialog with investors and analysts isbeing continued in order to increase the transparencyof the group and our business strategy. Theacquisition of Saint Louis Sucre, the second largestF-54

French sugar producer, and the sale of SchöllerHolding marked a change in strategy in 2002. Thisled to a significant strengthening of our position asEurope’s largest sugar producer. Our businessstrategy has caused great interest at the manyroadshows and meetings with analysts held in Europeand the USA particularly as, in the uncertain marketconditions ruling for the past three years, investorsvalue companies with sound cash flows, growthopportunities and defensive characteristics.This was demonstrated at our annual generalmeeting in Würzburg on August 22, 2002, at whichsome 1,800 shareholders, representing 82 % of theordinary shares, passed the resolutions on the agendawith majorities of over 99.9 %. The dividend increaseto D 0.47 per ordinary share, following D 0.34 perordinary share and D 0.38 per preference share (witha special dividend of D 1 in the previous year) waspositively received.index calculation Südzucker was number 5 with amarket weighting of 3.5 % in the MDAX, reducedfrom 70 to 50 shares.The visibility of the Südzucker share was raised atEuropean level by admission to the Dow Jones STOXX600 index. Effective September 23, 2002, Südzuckeris the only German foodstuffs company whose shareshave been admitted to the food and beveragessegment. The Dow Jones STOXX 600 index aims toprovide a representative picture of the entireEuropean share market. Both indices in whichSüdzucker is represented are updated quarterly.Enhanced by the conversion of preference shares toordinary shares in 2001 and the capital increase in2001, the Südzucker share’s trading liquidity againimproved. The average daily share turnover duringthe year increased to 362,000 (322,000) (Clearstreambanking).Market capitalization/indicesSüdzucker AG's market capitalization was D 2.55billion (D 2.97 billion) on February 28, 2003. Despitethis decline and the change of index calculation tofree float in 2002, Südzucker could improve itsposition within the DAX100 and reached number 36(42) by February 28, 2003.Deutsche Börse's new index system was implementedon March 24, 2003. Only those companies meetingprime standard (such as quarterly reporting, accountingpolicies using IAS or US GAAP) are included in thenew DAX and MDAX. Südzucker achieved admissionto prime standard on January 1, 2003. For the firstSüdzucker share data2002/03 2001/02Dividend D 0.50 1) 0.47Dividend yield % 3.4 2.8Price at the end of the year 2) D 14.60 17.00Market capitalization at end of year D million 2,552 2,971Number of issued H 1 shares 174,787,946 174,787,946Key ratiosEarnings per share D 1.52 1.45Cash flow per share D 3.41 3.44Price earnings ratio 9.6 11.7Price cash flow ratio 4.3 4.9ROCE % 11.8 13.21)Proposed. 2) Closing price, Frankfurt stock exchange.F-55

Südzucker shareBy converting its 1,500,000 preference shares (13.6 %of share capital) to ordinary shares, AGRANABeteiligungs-AG became eligible for listing on theprime market of the Vienna stock exchange andhence raised AGRANA’s attraction for the capitalmarket. In connection with this conversion,Südzucker and the Austrian shareholders transferredtheir directly-held holdings in the ordinary shares,totaling 86.4 % of the share capital, to Zucker undStärke Holding Aktiengesellschaft, Vienna. Thisenabled AGRANA to have a single class of sharewhilst maintaining existing shareholder relationships.AGRANA shares are listed on the prime market of theVienna stock exchange under ISIN AT 000 060 370 9.Corporate governance*Corporate governance is a management feature ofincreasing interest to financial markets. Corporategovernance mainly concerns the development ofstandards of management, corporate control andtransparency in companies with the aim of achievinglong-term value added in the interest ofshareholders. In Germany, a governmentcommission was formed, resulting in theintroduction of a German corporate governance code.Südzucker has studied the code in depth andsubmitted the declaration as set out in § 161 StockCorporation Law in December 2002.* See also page 54 of the annual report andwww.suedzucker.de/investorrelations/de/governance.Shareholder structureWith the sale of 6.1 % of its shareholding, previouslyreported as totaling 11%, in December 2002, DeutscheBank reduced its shareholding in Südzucker to lessthan 5 %. The free float of Südzucker shares thusrose to 34 %. We were informed by SüddeutscheZuckerrübenverwertungs-Genossenschaft eG (SZVG)that their own shareholding and those shares heldShareholder structureby them on trust for their own shareholdersrepresented a majority holding of 56 %. Other majorowners are our Austrian shareholders, via ZSG NL(Netherlands) B.V., with 10 %.Dividend for 2002/03The satisfactory growth in profitability enables us,the executive board and supervisory board, torecommend an increased dividend to the annualshareholders' meeting on July 31, 2003, up byD 0.03 to D 0.50 (D 0.47) per share. The amountdistributed will thus increase by 6 % to D 87.4 million(D 82.2 million).Growth in dividendsin D million1993/94 35.11994/95 36.51995/96 36.51996/97 42.71997/98 46.21998/99 46.71999/20002000/0147.549.92001/02 82.22002/03 87.4 (Proposed)+72.2 special dividend56 %SZVG10 %ZSG34 %Free float+143.0 special dividendF-56

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Sugar segmentOverviewThe figures for the sugar segment relate to SüdzuckerAG, Südzucker GmbH and Südzucker International,Saint Louis Sucre, Raffinerie Tirlemontoise Group andAGRANA Group sugar activities. The segment alsoincludes the agricultural and feedstuffs divisions.Key figures for the sugar segment2002/03 2001/02Sales D million 3,359 2,758Operating profit D million 397 328Operating margin % 11.8 11.9ROCE % 10.9 13.3Capital expenditures D million 135 102Investments in financial assets D million 31 1,610There were a total of 42 (45) sugar factories in thesugar group in 2002/03, of which 2 were cane sugarrefineries. The number of works in the EuropeanUnion fell to 25 (28) following the closure of twofactories in Germany and the sale of one sugarfactory in Belgium. The group has 17 (17) factoriesin Eastern Europe. The 14 sugar factories in Polandacquired in April 2003 are not included in thesefigures.Sugar beet processed throughout the group rose bysome 19 % to 29.7 million tonnes (25.0 milliontonnes), with an increase in the European Union ofsome 17 % to 25.7 million tonnes (22.0 million tonnes)despite the sale of the Veurne factory, wherebygrowth was mainly due to higher beet crops inGermany and France. The increase in eastern Europeto 4.0 million tonnes (3.0 million tonnes) of beet isabove all due to acquisitions in Poland. The sugarcontent throughout the group was 17.23 % (16.77 %),whereby the rate in eastern Europe was some2 percentage points below the EU content. Sugarproduction throughout the group rose by 17 % to4.7 million tonnes (4.0 million tonnes), due to thegreater quantity of beet processed and higher sugarcontent. Due to measures taken to improve the worksstructure as well as the increased sugar beet harvest,it was possible to considerably prolong the campaignperiod. Sugar beet processing lasted an average of92 days (75 days) within the EU group and 71 days(63 days) in Eastern Europe.There were 12 (14) sugar factories in operation inGermany for the 2002/03 campaign. The Löbau worksis included in these figures, but was closed after the2002 campaign. A total of 9 (7) factories areallocated to Südzucker International in easternEurope, of which 6 (3) are located in Poland and 3 (4)in Moldova. The agricultural and feedstuffs divisions,Bodengesundheitsdienst (BGD) fertilizationconsultancy and REKO Erdenvertrieb GmbHcomposting works in Regensburg and Plattling arealso directly allocated to Südzucker AG.Following the sale of the Veurne sugar factory,Raffinerie Tirlemontoise, Belgium has 4 (5) sugarfactories located in Belgium. Saint Louis Sucre,France, which was acquired in 2001, has 5 sugarfactories and one cane sugar refinery operating inthe traditional sugar area in France. SLS also hasactivities in eastern Europe via its investment inEastern Sugar. AGRANA Group, Austria operates atotal of 11 (13) sugar factories, of which 3 (3) arelocated in Austria and 8 (10) in Romania, Slovakia,The Czech Republic and Hungary.Group sugar productionin million tonnes2000/01 3.52001/02 4.02002/03 4.7F-58

Global and EU marketdevelopments12.5 million tonnes on world markets. Brazil thusclaims almost one-third of the entire world-wideexport volume of some 40 million tonnes of sugar.Speculation affects sugar priceAs expected, world sugar production exceeded worldconsumption by 4.5 million tonnes and hence theworld stock of sugar rose to a new record of 67.5million tonnes, equivalent to half global annualconsumption. Despite awareness of this overcapacity,sugar prices rose briefly to US $ 240 pertonne. This was mainly attributable to funds which,due to a lack of alternatives, were invested incommodities such as sugar to an extent notpreviously known. Fund involvement in the sugarmarket briefly exceeded 5 million tonnes, which werewithheld speculatively from the market and hencegave rise to a speculatively induced shortage. Theunusual significance of this speculative elementcaused considerable uncertainty amongst producers,traders and buyers, particularly because these stockswill weigh on the market at a later date. This is alsoreflected by the unusually high volatility of the worldsugar price.Real export activity on global markets is mainlydetermined by Brazil which, with an estimated sugarproduction of 22 million tonnes, may export someGlobal market prices for sugarMarch 2000 to February 2003London, Ww. in US-$/tonne, nearest forward trading month350300250200150100500March2000Sept.2000March2001Sept.2001March2002Sept.2002Feb.2003World Trade Organisation negotiations still openAt the start of negotiations for a new round of WorldTrade Organisation negotiations in Doha the WTOmembers committed to agree by March 31, 2003 ona framework within which the various WTO memberswould submit recommendations by the end of 2003to reduce their subsidies. However, the individualrecommendations are so far apart that, as expected,it was not possible for agreement to be reached ontime.The suggestion made by Stuart Harbinson, the headof the WTO agricultural negotiations, would require adecrease of 60 % in customs duty for the Europeansugar sector. The recommendation of the EuropeanCommission to reduce customs duties by an averageGlobal sugar production and consumption1,000 t raw value2000/011Estimate.131,589131,4802001/02 138,124136,1572002/03 1 142,640139,421Global sugar production 2Global sugar consumption 2Beet sugar as apercentage of totalproduction 32000/01 28.146.82002/03 1 25.645.12001/02 24.245.5Inventories at August31 as a percentageof consumption 22F. O. Licht’s Europäisches Zuckerjournal No. 11 dated09.04.2003 “Second Estimate of Global Sugar Levels2002/03”.3F. O. Licht’s Europäisches Zuckerjournal No. 7 dated03.03.2003 “Second Estimate of Global Sugar Production2002/03“.F-59

Sugar segmentof 36 %, but at least by 15 % per product line, wouldalso be difficult for domestic beet farmers and sugarproducers.As it proved impossible to arrive at a compromiseby March 31, 2003, it can be assumed that thenegotiations will recommence in September 2003at the earliest.Future of the sugar market regulationThe sugar market regulation was prolonged toJune 30, 2006. Within this framework, the council ofministers required the commission to submit a reporton the sugar market regulation in early 2003,accompanied by recommendations for reform.In preparation for this report, the commissioninstructed a number of external institutions to carryout studies on the effects of various alternativereforms, competition in the European sugar sectorand the passing on to consumers of changes toagricultural raw material prices by the foodstuffsindustry. These studies are partly available in draftform and will be completed within the next few months.Preliminary results of the studies revealed to dateshow that any major change in the sugar marketregulation will have severe effects on the incomes ofsugar beet farmers and of the sugar industry in theEU. Furthermore, they would have a negative effecton the sugar industries of future central and easternEuropean EU member states. Additionally, the manydeveloping and ACP (Africa, Caribbean, Pacific)countries which currently profit from preferentialimports to the EU would suffer considerable negativeconsequences from reductions in the sugar marketregulation. This is also confirmed by a current studyissued by the Gesellschaft für TechnischeZusammenarbeit (GTZ), which has examined theeffects on these countries of liberalising the sugarmarket regulation.By encouraging sugar imports from the ACP countries,the sugar industry contributes considerably to theeconomic development of these countries. Greatersugar import volumes can be expected in the mediumterm as a result of a further support program forthe Least Developed Countries (LDC). Considerableproblems are already being experienced by Austria,Italy and Germany from the West Balkan Agreement.Development aid and reconstruction assistance areprojects to be supported, but individual businessesare increasingly attempting to misuse these newopportunities to increase their own profits. It is mostimportant to act informatively, so that assistancecan also be received by those most in need.DeclassificationContrary to expectations and the recommendationsof the European sugar industry, in 2001 the EUcommission made no use of the so-calleddeclassification, which permits flexible adjustmentsto be made to production quotas in order to trackchanges in consumption and exports and thuscomply with WTO commitments. In September 2002 asurprisingly high declassification coefficient of 5.7 %was set for production from the 2002/03 campaign.For German producers that meant a temporaryreduction to their quotas of 7.1 %. With theseunforeseen decisions, the commission contributed toconsiderable market uncertainty and made the linkbetween production and actual sales volumesconsiderably more difficult. The sugar industry thusrequested the commission in future to announce itsdecisions on declassification earlier than at presentand to make them more closely linked to marketrequirements.Production levyThe basic production levy for the 2001/02 sugaryear amounts to D 1.2638 per 100 kilos of whitesugar and the additional levy for B-sugar wasincreased by 81 % to D 23.6936 per 100 kilos. WithF-60

an overall production levy on B-sugar of D 24.9601per 100 kilos of white sugar, the maximum productionlevy of 39.5 % of the net intervention price wasreached. Furthermore, a supplementary levy of 8.3 %was agreed. For Germany, this ranges betweenD 0.55 and D 0.58 per 100 kilos of white sugar. Byoffsetting the positive balance from the storagecost offset fund, the part to be borne by the sugarindustry fell by D 0.22 per 100 kilos.EU member candidatesFollowing resolution of the dispute between Polandand the EU commission on interpretation of theagreements on agricultural subsidies in the membershiptreaty, the governments of all EU candidate countrieshave agreed the membership treaties. This means thatthe expansion of the EU by a further 10 countries onMay 1, 2004 can be completed as planned. Withrespect to sugar, the EU has made considerableconcessions to its negotiation terms on sugarproduction quotas for the applicant countries. Thisparticularly affects quotas for Latvia (+ 27 %) andLithuania (+ 7 %), as well as Hungary (+ 6 %). Thelargest quota holder is Poland, with a maximumquota of 1.674 million tonnes of sugar, followed bythe Czech Republic and Hungary with 0.454 milliontonnes and 0.402 million tonnes of sugar respectively.EU sugar production up by 11 %Sugar production in the EU reached 16.92 milliontonnes (14.94 million tonnes), back to almost thesame level as in 2000. The main reason for the growthin 2002 was a rise of 2.7 % in the area undercultivation for sugar beet in the EU, to 1.835 millionhectares (1.788 million hectares) and in sugarproduction to 9.06 tonnes per hectare (8.11 tonnesper hectare). Almost 400,000 tonnes (385,000 tonnes)of C-sugar was transferred to the 2003/04 sugar year.EU sugar market 2002CountriesGermanyFranceItalyThe NetherlandsBelgium/LuxembourgDenmarkIrelandGreat BritainGreeceSpainPortugalAustriaFinlandSwedenEU-15Area underbeet cultivationSugar yield 1) Basis quota 2) Sugar production 1) Sugar consumption 1)1,000 ha t/haWhite sugar value 1,000 t457 8.76 2,427 4,017 2,773399 3) 11.60 3) 2,778 4) 4,973 3) 2,096240 5.90 1,243 1,417 1,432109 9.38 640 1,023 66998 10.20 637 1,003 54555 9.55 303 525 25131 6.58 175 204 169148 8.78 998 1,300 6) 2,15941 7.23 278 300 314117 9.79 938 1,153 1,24110 7.70 70 5) 77 33145 9.71 295 458 29532 4.84 128 155 20853 7.83 323 415 3851,835 9.06 11,230 17,020 12,8681)Directorate-General for Agriculture, Brussels. 2) Ex-declassification quotas. 3) Excluding overseas departments.4)Including overseas departments. 5) Including the Azores. 6) Sugar beet, including approx. 1.5 million tonnes ofACP preferential sugar, overall production amounted to 2.8 million tonnes, or 130 % of consumption.F-61

Sugar segmentPerformance of theSüdzucker GroupBeet harvest and campaignThe area under beet cultivation for Südzucker Groupin 2002/03 rose to 472,400 hectares (465,100 hectares).The reduction in area under cultivation due to thedisposal of Veurne, the Belgium sugar factory, wasmore than offset by an expansion in Germanyand France. Within the EU, the area under cultivationrose to 373,400 hectares (370,500 hectares) and ineastern Europe to 99,000 hectares (94,700 hectares).Area of beet under cultivation for the Groupin 1,000 ha2000/01 3632001/022002/03465472Due to unusually good weather conditions for beetgrowth in Germany, beet and sugar yields were highin the areas covered by Südzucker AG and SüdzuckerGmbH. For Südzucker AG, yields were only just lowerthan for 2000, a record year, and for Südzucker GmbHthat year’s levels could even be exceeded. Thesignificant rainfall in the summer of 2002 wasextremely beneficial to beet growth and in someregions led to record flooding. In the area covered bySüdzucker GmbH some 1,200 hectares of beet on thebanks of the Elbe and Mulde were under water, ofwhich some 1,000 hectares could not be harvested.With an area under cultivation of 177,800 hectares(172,200 hectares), a total of 1.76 (1.53 milliontonnes) million tonnes of sugar were produced from11.8 million tonnes (10.1 million tonnes) of beetwith a sugar content of 17.2 % (17.4 %). Followingclosure of the Delitzsch and Zeil works, the averagecampaign period rose to 95 (73) days. 2002 wasthe last campaign for the Löbau works. We thankand acknowledge the hard work of its staff.F-62In Belgium, the 2002 agricultural year was markedby early sowing and good growing conditions. Thearea under cultivation decreased to 64,300 hectares(70,800 hectares) due to the sale of Veurne, the sugarfactory. The high beet yield of 66.1 tonnes per hectare(57.1 tonnes per hectare) nevertheless led to anincreased beet harvest of 4.2 million tonnes (4.0 milliontonnes). 681,000 tonnes (634,200 tonnes) of sugarwere produced in a campaign lasting 82 days (70 days).In France, optimal weather conditions in the areaunder cultivation for Saint Louis Sucre led to aconsiderably higher beet yield than for the previousyear and an exceptional sugar yield. 6.7 milliontonnes (5.1 million tonnes) of beet were harvestedfrom 86,800 hectares (82,800 hectares), fromwhich 995,000 tonnes (757,000 tonnes) of sugar wereproduced. The campaign lasted 100 days (82 days).Weather conditions in spring were also satisfactoryin Austria and adequate rainfall in summer led togood beet growth. The beet yield was 68.2 tonnesper hectare (62.0 tonnes per hectare) for AGRANA,considerably higher than for the previous year,whereby sugar content was somewhat lower, at16.5 % (16.8 %). 3.0 million tonnes (2.8 milliontonnes) of beet were yielded from 44,500 hectares(44,700 hectares) of land, from which 456,000 tonnes(423,400 tonnes) of sugar were processed. Beetprocessing lasted 83 days (77 days).The seven works belonging to AGRANA Internationallocated in the central and eastern European countriesprocessed 309,000 tonnes (280,000 tonnes) of sugarfrom 2.3 million tonnes (2.1 million tonnes) of beet,grown on 54,800 hectares (57,600 hectares) of land,in 82 days (67 days). Including raw sugar refining of144,000 tonnes (132,000 tonnes), sugar productionreached 453,000 tonnes (412,000 tonnes).Thanks to good weather conditions and progress inplanting technology, the beet harvest in the area

under cultivation in Poland for the 6 (3) factories ofSüdzucker International was some 20 % higher thanfor the previous year, at 44.3 tonnes per hectare(36.8 tonnes per hectare). As in the previous year, thesugar yield was relatively low, at 15.7 % (15.9 %), dueto the wet autumn weather. Following the acquisitionof the Przeworsk sugar factory and the change incompanies included in the consolidation, the areaunder cultivation increased to 27,100 hectares(8,100 hectares). 164,000 tonnes (41,500 tonnes) ofsugar were produced from 1.2 million tonnes(0.3 million tonnes) of beet and the averagecampaign lasted 61 days (46 days).In Moldova the beet harvest could be increased to28.4 tonnes per hectare (21.7 tonnes per hectare),due to sufficient rainfall in summer. Lack of technicalequipment and pesticides led to an unsatisfactorybeet quality. 0.5 million tonnes (0.6 million tonnes) ofbeet with a sugar content of 13.9 % (15.0 %) wereharvested from 17,900 hectares (29,000 hectares).51,000 tonnes (64,900 tonnes) of sugar wereprocessed in a campaign lasting 58 days (58 days).Group beet processingin million tonnes2000/012001/022002/0322.325.029.7Sugar sales volumesThe EU companies in the Südzucker Group reachedlast year's levels of sugar sales in the EU, at 2.6 milliontonnes. At 1.2 million tonnes (1.5 million tonnes) ofsugar, exports were down due to lower quantitiesavailable.At 1,605,700 tonnes (1,836,600 tonnes) of sugar, totalsales volumes of Südzucker AG and Südzucker GmbHin 2002/03 were lower than for the previous year,due to the considerable decline in volumes availablefor export as a result of the harvest.Sugar sales volumes for Südzucker AG and SüdzuckerGmbH in the EU increased by 2.4 % to 1,245,000tonnes (1,216,100 tonnes). Deliveries to the sugarprocessing industry continued to grow. However, inparallel with market trends, sales volumes to foodretailers were slightly down. Whereas sales volumesto discounters showed a slight plus, sales volumesto other trade customers decreased slightly. However,it was possible to almost reach previous year's levelsoverall. Exports to other countries declined to360,700 tonnes (620,500 tonnes) due to the lowervolumes available for export.General consumer reticence (trade associations speakof one of the worst years ever for the sector) furtherfanned the flames of price competition already ragingin the food retailing industry. The deep discountersclearly profited most, and took additional marketshare from traditional full-range retail shops. Withits range of branded articles, Südzucker is directlyaffected by this trend, but is also indirectly affectedvia sales volumes to its industrial customers. Volumedeclines at customers in the branded goods areaand higher sales volumes to customers producingown-name articles provide evidence of a changingmarket.This development was particularly noticeable in thedrinks industry, our largest sugar customer. In thepast, increased demand for drinks in cans and PETbottles had led to a high proportion of sales usingnon-returnable packaging. Due to a compulsorycharge for these items introduced at the beginningof 2003, this share was sharply down and returnablecontainers gained ground. Production of returnablecontainers was expanded as a result of this changein the law, whereby some producers of non-returnablepackaging had to introduce short-time work.Südzucker demonstrated its closeness to the marketby being prepared for these events timely, and thuscould expand its market share in this turbulent yearfor the industry.F-63

Sugar segmentSüdzucker has further developed its system forimproving services to customers. A flexible andreliable just-in-time supply chain reduces customerwarehousing. Food safety continued to be a majortopic and new concepts were developed in this areajointly with customers. Currently, a sealing systemhas been introduced for silo trains, which accuratelydocuments the opening of silo trains ontransportation to and from the customer.As market leader, it is important for Südzucker tooccupy niche markets. Thus, bio-sugar was againprocessed from local beet during the 2002 campaign.The expansion of the special products range for thefood retailing industry begun last year was rigorouslycontinued. New products in the special range helpincrease the attractiveness of sugar products in thefull range area. Südzucker launched a 500 g packageof bio-sugar made from raw cane sugar on themarket, which meet trade and consumer qualityrequirements with its bio-seal. A mixture of traditionallyproducedicing sugar and more moisture-resistantIsomalt from Palatinit results in a product withoutstanding sprinkling qualities which does notbecome lumpy. It is sold with a newly-introducedshaker. With the changeover to tray-based packagingfor all products, the retail food industry is offeredpackaging and palleting suitable for all types ofoutlets. The re-launch of the brand range hasstrengthened the Südzucker brand presence.Sugar sales volumes at Saint Louis Sucre were1,121,600 tonnes (1,144,000 tonnes) in 2002/03(beet and cane sugar); its position in the EU couldagain be defended. Whereas the French and Germanmarkets are supplied from northern France, SLS hasa refinery in Marseilles in a good geographic positionto supply Italy and Spain. The company’s marketposition in France could be extended, particularlyby strengthening the Saint Louis, Tutti Free and CarteBlanche brands.Sugar sales volumes for AGRANA could be maintainedat almost the same level as for the previous year, at436,000 tonnes (444,000 tonnes). In addition tooverall consumer reticence, in particular imports fromthe neighbouring Balkan region under the terms ofthe EU treaty led to a decline in domestic sales to309,000 tonnes (326,000 tonnes). Household sugarsales and sales to the Austrian food industry wereequally affected. The introduction of a compulsorypackaging charge in Germany further reducedexports by the Austrian drinks industry of products innon-returnable packaging and hence domestic salesvolumes in Austria.Including increased sales volumes of sugar bysubsidiaries in the central and eastern Europeancountries of 475,000 tonnes (398,000 tonnes), theAGRANA Group achieved an overall sugar salesvolume of 911,000 tonnes (849,000 tonnes).Total sales volumes at Raffinerie Tirlemontoise roseby 4 % due to higher sugar production in the2002/03 campaign. Sales volumes in the EU declinedslightly, whereby gains in the end-consumer marketcould not fully compensate for declines in theindustrial area. Ti´Light, the low-calorie product, salesof which are still growing rapidly, was supplementedby Ti´Flora and Ti´Calcium, both health-related products.Candico, a subsidiary, could further extend its marketposition in the retailing and industrial sectors.A total of 750,000 tonnes (970,000 tonnes) of sugarfrom Belgium, Germany and Austria were exported tothird countries during 2002/03 via SüdzuckergroupExport Centre (SEC). The reason for the sharpdecrease was a smaller harvest by the SüdzuckerGroup in 2001. Due to increased deliveries bycompetitors, above all from Brazil, we had to reduceour exports to Africa and the Middle East.F-64

Sales volumes for the six Polish factories rose to128,000 tonnes (118,000 tonnes) of sugar. The Polishsugar market is suffering from considerableover-capacity. Formation of a state Polish sugarcompany did not lead to market stabilisation, as theliquidity of many factories determines sales policy.Our market position in Moldova could further beextended. Cancellation of the trade agreementbetween Moldova and the Ukraine led to a halt forexports to the Ukraine.Reliable agricultureOperations of the Südzucker agriculture divisionagain delivered positive results due to the excellentsugar beet yield and quality in 2002/03.Agricultural research carried out in many areasled to new knowledge, underscoring the reliableperformance by agriculture. The main areas ofresearch continued to be soil processing and aselective area of cultivation approach to farming.The findings enable various regions of Europe toimplement optimal soil processing and an idealsupply of nutrients to sugar beet, resulting in highyields per hectare and good quality. Use of thisknow-how at farms in Moldova and Poland as wellas in other eastern European countries has beenparticularly satisfactory.Südzucker thus makes a significant contribution toa sustained agricultural sector, particularly in thesecountries, as it can be demonstrated that ecologicalconsiderations can indeed be satisfied alongside vitalfinancial objectives in agriculture, and can sometimeseven increase yields.FeedstuffsPellets and molasses, sugar processing by-products,could be marketed in line with budget at all groupcompanies. In Germany, sales volumes of molassesshavings and molasses shaving pellets fell slightlydue to lower quantities available, but morefinancially viable freight distances led to improvedyields. Molasses sales volumes continue to shifttowards the yeast industry, whose needs are met byhigh quality molasses. Raffinerie Tirlemontoise andSaint Louis Sucre have also fully achieved theirobjectives for sales of molasses. AGRANA can showgrowth in sales volumes of sugar by-products as well.Sales volumes of pellets and molasses were in linewith budget. The main customers for molasses fromeastern Europe were the yeast and alcohol industriesin Poland, Moldova, Romania, the Czech Republic,Slovakia and Hungary.Bodengesundheitsdienst with a new range of testsBGD Bodengesundheitsdienst GmbH, Mannheim, is awholly-owned Südzucker subsidiary and carries outservices for agriculture. Its services include soilexamination and fertilisation advice for all majorplant foodstuffs, examination of humus andanalyses of organic fertiliser. Furthermore, as part ofstatutory requirements, nutrient comparisons arecarried out as part of the fertilisation ordinance, andpotatoes are tested as required by the official potatoordinance.The main source of revenues is fertilisation advisoryservices. These are carried out using the EUF soilexamination method, which identifies all the majorplant nutrients (nitrogen, phosphate, potash, lime,calcium, magnesium, boron and sulphur) from a soilsample and hence determines crop- and site-relatedfertilisation recommendations.A study for threadworm based on a DNA test is anew service. This threadworm test was developedin co-operation with the Biological Federal Office,the State Office for Agriculture in Freising and BeetF-65

Segment ZuckerPlanters Associations. The threadworm test deliverscriteria for steps to be taken to reduce threadwormwhen planting in affected areas such as, for example,intercropping special crops or varieties.REKO again records rising revenuesREKO Erdenvertrieb GmbH produces high-qualitycompost and substrate soil at the Regensburg andPlattling works from vegetation and soil cling on beetdelivered to the factories. The favourable weatherconditions for growth in the year ended February 28,2003 led to a further increase in the quantities ofvegetation delivered and hence to higher revenuesfrom supplies of vegetation. Due to the partlyextreme levels of rainfall in the autumn, quantitiessold were slightly down on the previous year, as soilprocessing was hardly possible during this time.However, this decline in revenues was more thanmade up by the increase in revenues from receivingvegetation. Due to demand from new landscapegardens and care of domestic gardens it is expectedthat there will be an increase in demand for compostand substrate soil as the current year progresses.F-66

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Special products segmentOverviewDevelopment of divisionsThe special products segment is made up of thePalatinit, ORAFTI and starch divisions, together withactivities of the Portion Pack, Surafti and FreibergerGroups.Key figures for the special products segment2002/03 2001/02*Sales D million 1,025 922Operating profit D million 123 93Operating margin % 12.0 10.0ROCE % 16.0 12.7Capital expenditure D million 72 76Investments in financial assets D million 14 61*Without Schöller Holding.Palatinit shows progressPalatinit GmbH, Mannheim, the number one for rawmaterials for sugar-free confectionery with Isomalt,could extend its market position in 2002/03, althoughnegative currency influences and increasedcompetition caused difficult overall conditions.Volumes of sales to a stagnating confectioneryindustry could be increased, as the sensory andphysiological properties of Isomalt are precisely inline with the fashion for confectionery which notonly promises but also meets the promise of "fulltaste with no regrets". The high taste qualities ofIsomalt-based confectionery compared withtraditional products has been confirmed time andtime again in blind tests carried out by independentmarket research institutions world-wide. Manypublished international consumer studies confirmthat, more than ever, healthy teeth, calorie contentand diabetes are major topics for consumers andsolutions are being sought by consuming “the right”food.Sales volumes of sugar-free chewing gum pellets andcough drops and breath-freshening confectionery areat a high level, and growth is continuing. Demandis growing rapidly in the sugar-free confectionerysector for products such as caramel cream orstrawberry cream. International producers havedecided in favour of using Isomalt from Palatinit forthese products. There has been further satisfactorygrowth in sales of sugar-free functional foodproducts containing Isomalt in Asian markets, whichtend to be open to traditional, health-inducingingredients and which make successful use of amodern sugar-free sweetener "made in Germany".F-68

Customer care is applied by using a specific rangeof services for matters regarding regulatory approval,processing technology and marketing. With theIsomalt product range and an optimised use ofIsomalt variants, Palatinit GmbH has stand-aloneattributes differentiating it sharply from itscompetitors. With capital expenditures in researchand development together with a further expansionof product capacity, Palatinit GmbH will be able toretain its market leadership in this product segmentin future.ORAFTI strengthens market penetrationThe business segments of the ORAFTI Group havedeveloped strongly in 2002/03 and were able tostrengthen their market penetration with functionalfood, textured consumables and specific fluidsweeteners.The "active food ingredients" division (inulin andoligofructose for human and animal nutrients) wasagain marked by strong sales growth. More than300 new foodstuffs were introduced with ORAFTIproducts RAFTILINE® and RAFTILOSE®. Markets inAsia were particularly stimulated by stressing thebeneficial pre-biotic effect of products on health.In America and Europe the topics of fibre andimproved calcium intake were grounds for success.There is growing interest in using inulin as a fatsubstitute. This trend is supported by consumer fearsabout obesity and diabetes, to which producers havereacted by introducing lower-calorie products on themarket. A further growth driver is interest infoodstuffs with low carbohydrates, for which inulinand oligofructose are ideal ingredients. ORAFTI wassubject to aggressive price competition for inulinproducts on certain markets.BENEO®, the communication program, shows furthersuccess. Many new products were introduced on themarket with the BENEO® label in Belgium and inSwitzerland.Capital expenditures were incurred to increaseproduction capacity at the Oreye works in Belgium,and possible locations for a second production plantare being analysed.The "liquid sweeteners" division profited from higherdemand for specially-designed liquid sweeteners.Both sales and profits rose despite price pressuresfrom imported fructose.Remy Industries, a part of ORAFTI, could more thanmeet its budget with its rice-based food additives.Sales of special rice-based starch and rice-based flourproducts are made worldwide. Remy was able tomeet customers’ heightened hygiene and safetyrequirements. Synergies planned with the purchaseof Remy through co-operation with ORAFTI led toconsiderable cost reductions and market benefits.Co-operation in the research and development areaalso lived up to expectations.Starch grows through innovationSüdzucker Group’s starch activities are mainly carriedout by AGRANA.The starch division performed satisfactorily in 2002/03.Despite a market-related decline in prices, revenuesrose by 12 % to D 209.9 million (D 187.5 million),mainly due to entry into new markets and a successfulupgrading strategy. Operating profits also continuedto improve. In Austria, sales volumes of corn-starchbased products increased particularly satisfactorily,with a rise of 17 %. Sales volumes divided into foodand non-food applications show an increase in thenon-food/technical starch area, although at theexpense of lower prices, of almost 27 %, whereasturnover volumes in the food area only rose slightly.F-69

Special products segmentAGRANA has been involved in the biologically-basedstarch products business for more than 10 years andhas recorded double-digit growth rates for this productgroup over the past few years. Potatoes and maizefrom biological farms are processed to yield biologicalstarch, biological sweeteners and biological potatoproducts. Customers are drawn from the entire foodindustry and they use these products primarily forpreserving fruit, confectionery, baby food, bakeryproducts and delicatessen products. Already in thefifth year of operations, AGRANA produces foodadditives made from maize and waxy maize, certifiedas being free from genetic modification. Hence,AGRANA is one of the largest business-to-businesssuppliers on the European market in the biologicaland GM-free sectors.Portion Pack Europe (PPE) increases salesPortion Pack Europe Group’s turnover rose by morethan 30 % in 2002/03, to some D 125 million.7.5 % of this increase related to internal growth, withthe rest coming from the purchase of Portion PackLandgraf (Holland) and Cocachoc, Belgium. TheEuropean-wide group specialises in portion packs forthe catering and wholesaler sectors and isincreasingly entering niche markets for its variouscustomer groups. PPE expects to continue growing,despite the difficult economic environment.SuraftiThe Surafti Group delivers mainly sugar-based nicheproducts to the processing industry for bakeryproducts. Production is located at six medium-sizedoperations in four countries. Acquisitionsstrengthened the nougat activities in France in2002/03.Freiberger Group in pole position throughoutEuropeFreiberger Group, allocated to the special productssegment, has a leading position in the frozen pizzasand baguettes market throughout Europe. Topqualityproducts are produced using state-of-thearttechnology at production locations in Berlin,Muggensturm, Baden and Oberhofen, Austria. Theyare mainly offered as individual own-name productsdesigned specifically to meet customer requirements.Freiberger could profit from the continuing upwardtrend on the German frozen pizza market, particularlywith own-name products. Furthermore, entry intoother European markets continued to be successfuland this has led to satisfactory growth.As part of our policy of concentrating on our corebusiness activities, Südzucker sold its investmentin VK Mühlen AG, Hamburg, held via AIH Agrar-Industrie-Holding GmbH, Mannheim, to Leipnik-Lundenburger Invest Beteiligungs AG (LLI), Vienna.F-70

PersonnelNumber of employees declines due to disposalsDespite the acquisition of Saint Louis Sucre, thedisposal of Schöller Holding, with its large number ofstaff, led to a sharp decline in the number ofemployees in the group. On average there were14,855 persons employed in the group in 2002/03, ofwhich 11,543 were employed in the sugar segment.Mainly as a result of acquisitions, the number ofpersons in the special products segment rose to 3,312.Employees by segment43 %Sugar EU35 %Sugar eastern Europe22 %Special productsTop-quality training and developmentThe Südzucker Group believes its future depends onthe quality of its employees and in training youngpeople. Once again in 2002/03, the work of ourhuman resources department was concentrated ontraining and development. This can be demonstratedby the high number of apprenticeships which, forexample, was 7 % at AGRANA in Austria and 10 %at Südzucker in Germany. Südzucker has apprenticesfor 11 different professions within the group, andtheir good exam results speak for the high level oftraining quality at Südzucker. The introduction ofEnglish as the common corporate language wasaccompanied by language training and refreshercourses which were eagerly taken up by the staff.Business English has been offered as a supplementaryqualification in the white-collar apprenticeships formany years. Group-wide trainee programs smooththe way for young, talented people to transfer fromapprenticeship to practice and attract qualified newstaff to the group. For the same reason, internshipsare offered at all the group’s divisions.The international deployment of employees as part oftheir career planning and development has increasedsince last year. We have thus been able to give highlyqualifiedmanagement trainees an experience ofintercultural life and convey to them an understandingof the Südzucker Group’s strategic direction.Safety at work could again be improved within thegroup. Parallel to the measures taken in the SüdzuckerGroup, the implementation of an interactive worksafety training program and many internal andexternal training sessions and preventative measureto once again reduce accident numbers were carriedout as part of the social dialog between the Europeansugar industry and employee representatives. Theintegration of health safety in safety at work hasproved to be successful.Many of the employees affected by the restructuringprogram in Germany were able to take up jobs atother locations. A number of older employees tookadvantage of the early retirement program.We should like to thank all our staff for their interestand hard work over the year. Our special thanks goto the employees of the Löbau works which closed atthe end of the 2002 sugar beet campaign. Furthermore,we extend out thanks to members of the workscouncils for their co-operation and fairness.Average number of employees during the year 2002/03 2001/02Sugar11,543 12,148Sugar EU 6,335 6,494Südzucker AG and Südzucker GmbH 2,946 3,040Raffinerie Tirlemontoise (Sugar) 849 930Saint Louis Sucre 1,673 1,616 1)AGRANA 903 908Sugar eastern Europe 5,208 5,654Special products segment3,312 2,886Total14,855 15,034 2)1) 2)12 months. Excluding Schöller Group.F-71

Capital expendituresCapital expenditures for tangible and intangible noncurrentassets in the group amounted to D 207 million(D 178 million excluding Schöller) in 2002/03.Approximately two-thirds of the capital expendituresrelated to new products and to expansion andrationalisation measures. Capital expenditures forreplacements took up 31 % of the budget, and3 % were used for purely environmental measures.65 % of capital expenditures, totaling D 135 million(D 102 million), related to the sugar segmentand 35 %, or D 72 million (D 77 million excludingSchöller), to the special products segment.Sugar segmentIn the sugar segment, and in connection with theclosure of the Delitzsch and Zeil works, steps weretaken to stabilise processing capacity and improvewarehousing capacity at those Südzucker AG andSüdzucker GmbH works which took over the beetpreviously processed at the Delitzsch and Zeil factories.Warehouse capacity in Südzucker GmbH’s area ofoperations was increased by adding a new sugarwarehouse at Brottewitz for storing 3,500 tonnesof crystallized sugar and a 20,000 m 3 syrup tank atZeitz. Some of the plant at the Delitzsch works wastransferred to the Brottewitz, Zeitz and Plattlingfactories. At the Rain factory, a non-stop plant toimprove white sugar crystallization started operationsand sugar warehousing capacity was improved byextending the high-bay warehouse. Unloadingequipment for self-tipping beet vehicles was installedin the beet yards at Ochsenfurt, Wabern andRegensburg. The boiler house automation systemswere renewed at the Ochsenfurt, Groß-Gerau andWabern works and construction of a newconditioning and silo de-dusting plant wascompleted at the Offstein works.The largest single capital expenditure at RaffinerieTirlemontoise was the start of operations for a newsix-step steam station at the Wanze works. Plannedenergy savings and syrup quality improvements wereachieved. At the Tienen works the viewing stationwas expanded to meet customer demands relating tocrystal fractionation. Capital expenditures atBrugelette were aimed at improving extraction workand the processing control system was renewed atGenappe.Capital expenditures at Saint Louis Sucre weremainly made to meet new French safety regulations.Capital expenditures at AGRANA were primarilyinvested at its Tulln works in Austria. A betaneprocessing plant improved the molasses sugarextraction process. Beet yard performance wasincreased by a stone-separating drum, whereas theinstallation of a combi-packing machine for 500 gand 1 kg packages improved flexibility. Capitalexpenditures at the Hohenau and Leopoldsdorfworks were incurred in the sugar house, with newwhite sugar centrifuges, heating chambers forboiling plant and cool air ventilators for the sugardrying equipment.Capital expenditures in Poland and Moldova servedprimarily to reduce energy consumption and increaseproductivity.Special products segmentIn line with the broad range of business activitiesincluded in this segment, capital expenditures weredivided amongst many of these companies. Capitalexpenditures mainly served to expand Palatinit andORAFTI capacity in order to meet the needs of arapidly growing market. This also applies to capitalexpenditures in the starch division.F-72

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Research and developmentSüdzucker Group’s research and development work isconcentrated on new products or product variants,optimising production processes and supportingmarketing activities. The range of tasks stretchesfrom agricultural production to sugar, sugar-freesweeteners, starch, and inulin product divisions andtheir related products, through to applicationtechnology in the food and non-food areas. This workis carried out by some 200 employees at four grouplocations.Südzucker Group’s innovative powers are also clearlydemonstrated by the number of patents filed. Fifteennew patents were registered in 2002/03 to secure thegroup’s market success in the special productssegment. D 25.5 million (D 22.8 million) were spenton research and development in 2002/03.Sugar, specialities and special productsThe key points in the program were the developmentof new customer-tailored products for fondants,caramels and icing sugar. In addition to productcharacteristics, further research projects includedpotential to enhance health with existing productsand new functional carbohydrates.Use of sugar or other carbohydrates as renewableraw materials in non-food applications, such ashydraulic fluids, is being rigorously researched.Caramel sugar syrup also as a free-flowingpowderCaramel sugar syrup is produced in Offstein andOchsenfurt as a golden to deep-brown aromatic syrupfor a large number of applications in food products.Over the past few years the product range has beenexpanded to meet specific customer demand forsweet, aromatic, viscous or highly-coloured syrups.These syrups are used for producing Christmasbakeries, desserts, creams and fillings.Together with AGRANA, a powder-form, free-flowing,low-dust variety has been developed, which is offeredas instant caramel in two products.New icing sugarA niche for the Südzucker household range has beenfilled by a new icing sugar in sifters. The combinationof finely-ground sugar and Isomalt, a carbohydratebased on sugar used as an anti-caking additive,makes the product particularly easy to sprinkle andstable when stored. This newly-developed icing sugaris distinguished by its sugar-sensory properties andcharacteristics enhancing its use for specificapplications, thus setting it apart from competingproducts, most of which contain starch, phosphatesor fat.Improved production control throughnew analysis technologyProduction expansion in the special productssegment led to considerably higher demand foranalysis. The introduction of a completely newtesting procedure, near infra-red spectrometry(NIRS), permits analytical process controls to becost beneficial as well as all-encompassing. With thehelp of this technology it is possible to quickly andsimultaneously determine a number of differentanalysis parameters, based on which the appropriatecalibration is prepared by the central analysisF-74

department. Introduction of this technology inroutine analysis has improved production control, asit is possible to carry out more frequent tests withoutincurring additional costs.Positive scientific nutritional studies with IsomaltVarious studies have been carried out to determinethe physiological properties of Isomalt. In anAustralian study of state-of-the-art standard, it wasconfirmed that Isomalt does not cause an increaseof blood glucose and is metabolised almost insulinindependently.The results confirm the specialsuitability of Isomalt in foods for people withdiabetes and related blood glucose regulation disorders.A further study confirmed that even a highconsumption of Isomalt leads to no adversephysiological effects, in contrast to often-mentionedprejudices. On the contrary, it could be confirmed forthe first time that Isomalt has a positive effect ongut function. Other data on oral health demonstratedthat Isomalt supports the effects of fluoride inslowing demineralisation.New functional carbohydratesAs part of a project supported by the Federal Ministryof Education and Research (BMBF) aimed at developingnew functional carbohydrates for the food industry,many methods for modifications of carbohydrateswith different functional capabilities wereestablished under laboratory conditions. In order toexamine their health potential, the stomach andintestinal properties of these modified carbohydrateswere compared with products already on the market,using biological and microbiological test methods.The tests checked whether these carbohydrates werebroken down in the stomach and small intestine. Inan in-vitro test, stable substances were subjected tohuman intestinal flora in order to examine theirfermentation properties in the large intestine. Asa result, promising substances were identified forpotential new ingredients with positive health properties,due to their effects in various parts of theintestine and which, together with their positiveapplication properties, would be useful supplementsto existing functional ingredients. Further intensiveresearch and development work is needed beforesuch products can be launched on the market.Research was also carried out on carbohydrates whichcan reduce the infection potential of pathologicalmicroorganisms by interaction with cell surfaces.Südzucker co-operates with many German, Europeanand international research institutions in carryingout nutritional research. Following completion of theBMBF-subsidised project, new research agreementswere made with partner universities partly inconnection with a joint project on foods for a healthylife and disease prevention through nutrition.Sugar-based hydraulic fluidsA co-operation project was commenced with FuchsPetrolub AG, Mannheim to develop a bio-degradablehydraulic fluid. So-called sugar esters are producedfrom sugar and fatty acids, which can be used as abase oil in high-quality hydraulic fluids. Due to itschemical structure the product can be bio-degradedand is therefore an interesting product group forF-75

Research and developmenta number of applications, particularly in theconstruction, farming and forestry industries.Product development in the starch division forconstruction and ceramicsWe have succeeded in developing a product line formanufacturing modified starches for dispersioncolours. Normally, high-priced cellulose ether is usedfor dispersion colours. The market launch is foreseenwhen the new coating line starts operating at Gmünd.This is a new application for modified starches.Rice ingredients as a new field of developmentThe integration of Remy Industries, which producesrice-based ingredients such as rice flours, starch andproteins, has substantially strengthened developmentin the areas of bakeries, cheese and all-vegetablerecipes. Furthermore, combined products,incorporating rice starch and inulin, are also beingdeveloped for new applications.FructaneThe fructane research and development activities,including inulin and fructo-oligosaccharide, arelocated in Belgium. Application tests of two newproducts, RAFTILOSE®Synergy1 and RAFTILINE®HPX,show considerable technological advantages,including for fat and cheese spreads.Food additives developed especially for the endconsumermarket, covered under the overall title of“Innergy Food”, are initially sold in Belgium andinclude Optimal Inside (RAFTILOSE®Synergy1 insmall portion sticks), Take 2 (tablets withRAFTILOSE®Synergy1, calcium and orange fibre)and Active Fiber (powder from RAFTILOSE®Synergy1and orange fibre).In the nutritional research area, studies are beingcarried out on the effects of inulin and oligofructoseproducts on bone mineralisation and calciumreabsorption. Further objectives relate to possibleprotective effects from intestinal cancer, modulationof the immune system, lipid metabolism and overallwellness. As a further step, there have beenexaminations on the impact of RAFTILOSE®Synergy1on the overall health of elderly persons. Part of thesestudies was supported by the EU-subsidised SYNCANproject, co-ordinated by ORAFTI. The database ofpositive health effects of fructanes was furtherexpanded with these studies.Development of new fondant productsFondant comes from the French word "fondre"which means "melt" and thus demonstratesthe prime quality characteristic of the product:microscopic crystals for gentle melting.Snow-white fondant is produced from refinedsugar and glucose syrup, a sugar base makingwork considerably easier for the user, as it can beprocessed to form attractive glazes in little time.For production, a hot, supersaturated solution isstirred and intensively mixed under rapid cooling,so forming a large number of fine saccharinecrystals. This process is known as tabling, referringto the traditional method of making fondant witha spatula on a cooled marble slab. Today, tablingis carried out continuously on turntables underpre-defined conditions, guaranteeing constantgood quality.F-76

Fondants and glazes from Südzucker meet all therequirements for sweetening, decorating, filling andpreserving bakery products. Due to their finecrystallised structure, the confectionery industry alsooften uses them for fondant confectionery, chocolatebar fillings, soft caramels and chewing pellets.Various mixing techniques for different fondantadditives, such as cocoa, fat, aroma and colours, areused in production at Ochsenfurt, Oostkamp andEdinburgh. A number of new developments, usingindividual recipes and optimisation of productionprocesses, has expanded the product range overthe past years. Above all, for the constantly growingmarket for industrial ready-made bakery products,glazes with optimal processing and storage qualitiesand of high quality are developed to meet specificcustomer requirements.F-77

Corporate governanceGood corporate governance makes a majorcontribution to the success of a company. Südzuckerthus welcomes the recommendations set out in theGerman corporate governance code and has accordinglyresolved to follow its recommendations and implementthem where necessary. An appropriate declaration ofcompliance was made as at the end of 2002 inaccordance with § 161 Stock Corporation Law.An audit committee has been established in additionto the existing management, mediation, social andagricultural supervisory board committees.At Südzucker, co-operation between the supervisoryboard, executive board and shareholders hastraditionally been marked by transparency andresponsibility. The corporate objective followed by theexecutive board and supervisory board of achieving aresponsible and sustained value added is a significantpart of corporate governance and by means of whichwe hope to nurture the trust of our shareholders,financial markets and our business associates andemployees.In order to implement the German corporategovernance code the procedural rules for theexecutive board and supervisory board were adjustedto meet the code and, within the group, the internalrules and procedures for the executive board,supervisory board and annual general meeting werereviewed for transparency, for accounting policiesand annual audit. Any changes required to thecompany's by-laws will be put to the annual generalmeeting for resolution.In addition to statutory requirements, these changesare based on the code resolved by the governmentcommission itself. As we believe that the standardsset out herein represent good and responsiblecorporate management practice and are practical, wesee no reasons for preparing our own corporate rulesand regulations.F-78

Risks for future developmentsSüdzucker has developed and implemented anintegrated system for the timely identification andmonitoring of specific risks for the group. Theobjective is the timely identification andquantification of risks related to corporate activities.On this basis, strategic and operating opportunitiescan be extensively analysed and optimised.Risk management system of the Südzucker GroupSüdzucker's risk management system is based on riskcontrolling at operating level and on strategiccontrolling of investments, an internal control systemwhich is the responsibility of the group internal auditdepartment and an early warning system todetermine risks endangering the existence of thegroup as a going concern.Risk controlling at operating level andstrategic controlling of investmentsThe main thrust of strategic controlling ofinvestments is the strategic planning of segmentsand business divisions. Significant developmentsinfluencing the business are recorded and evaluated.Opportunities and risks are considered based onmarket and competitive analyses, and these form thebasis for management decisions.Investment controlling also supervises the setting ofbusiness objectives and monitors group companiesby using uniform key ratios. It evaluates theinvestment portfolio with the aim of optimising theinvestment structure and provides assistance withacquisitions.Operating risk controlling is implemented by theoperating controlling department. The executiveboard is continuously kept informed via an extensivereporting system and, if relevant, by ad hoc reports.Internal control system/internal auditThe group’s internal audit department carries out itscontrol functions at group companies and reportsdirectly to the executive board. It checks andevaluates the security, financial viability andcorrectness of business processes, together with theeffectiveness of the internal control system in thecorporate area.Early warning system to determine risksendangering the company as a going concernThe possible effects of international and nationaltrade agreements and market regulations are alreadyanalysed at an early stage and incorporated as partof the risk management system.Südzucker is subject to market risks arising fromchanges in foreign exchange rates, interest rates andequity prices. Treasury and foreign currencymanagement follow detailed guidelines. Foreigncurrency and interest rate derivatives are recordedtimely and completely at group level and are subjectto a continuous monthly valuation process.Standards have been developed to monitor risksarising from products produced and sold by theSüdzucker Group, which are constantly checked bymeans of continuous controls. These measures aremade mainly as part of the quality control program.The integration of quality management, safety atwork and environmental management establishesoptimal conditions for timely risk determination andfor implementing steps to minimise risk.Based on current reports by the internal riskmanagement working group and in its own estimation,the executive board has determined no matters whichcould endanger the group’s existence as a goingconcern.F-79

AUDITORS’ REPORTWe have audited the consolidated financial statementsprepared by Südzucker Aktiengesellschaft Mannheim/Ochsenfurt, Mannheim, consisting of the balancesheet, statement of income, statement of movementsin shareholders' equity, statement of cash flows andnotes, for the business year from March 1, 2002through February 28, 2003. The preparation andcontents of the consolidated financial statementsprepared in accordance with International FinancialReporting Standards (IFRS) are the responsibility ofthe company's executive board. Our responsibility isto express an opinion on the consolidated financialstatements based on the results of our audit.We conducted our audit of the consolidated financialstatements in accordance with German auditingstandards and generally accepted standards for auditsof financial statements promulgated by the Institutder Wirtschaftsprüfer (IDW), as well as in accordancewith International Standards on Auditing (ISA). Thosestandards require that we plan and perform the auditsuch that misstatements materially affecting theconsolidated financial statements are detected withreasonable assurance. Knowledge of the businessactivities and the economic and legal environment ofthe group and evaluations of possible misstatementsare taken into account in the determination of auditprocedures. The evidence supporting the disclosuresin the consolidated financial statements are examinedprimarily on a test basis within the framework of theaudit. The audit includes assessing the accountingprinciples used and significant estimates made bymanagement, as well as evaluating the overallpresentation of the consolidated financial statements.We believe that our audit provides a reasonable basisfor our opinion.position, results of operations and cash flows of thegroup for the year ended February 28, 2003 inaccordance with International Financial ReportingStandards.Our audit, which also included the group managementreport prepared by the executive board for the periodfrom March 1, 2002 through February 28, 2003, hasnot led to any reservations. In our opinion, on thewhole the group management report provides asuitable understanding of the position of the groupand suitably presents the risks for future development.We also confirm that the consolidated financialstatements and the group management report for thebusiness year from March 1, 2002 through February28, 2003 complies with the conditions for exemptionfrom preparing consolidated financial statements anda group management report in accordance withGerman law.Mannheim, May 15, 2003KPMG Deutsche Treuhand-GesellschaftAktiengesellschaftWirtschaftsprüfungsgesellschaftWalterHeubleinWirtschaftsprüfer WirtschaftsprüferIn our opinion, the consolidated financial statementspresent fairly the assets and liabilities, financialF-80

SÜDZUCKER AG MANNHEIM/OCHSENFURTINTERIM REPORT FOR THE FIRST HALFOF THE FINANCIALYEAR 2003/04F-81

Assets and liabilities, financial positions and results ofoperationsWe prepared the interim financial statements of the SüdzuckerGroup in line with the rules of interim reporting according toIAS 34. The accounting and valuation methods used in preparingthe Group financial statements as of 28 February 2003 are thesame as used in the interim financial statements. Income taxeswere calculated on the basis of the income tax rate applicablefor the whole year in the respective country for the individualcompanies. Sugar is produced primarily in the months Octoberto December. For this reason, the depreciation on the seasonallyused facilities occur primarily in the 3rd quarter, with depreciationin the first six months relating to equipment which is usedfor the whole year and which is not used in sugar production.The maintenance costs incurred in the first half year for thecompany’s 2003 season are deferred within the years and areposted under other assets.With the consolidation of the Silesian sugar factories, the scopeof consolidation has increased against the previous year by 16companies and with the Vallø Saft companies by two companies.F-82

GROUP BALANCE SHEETD million August 31, 2003 February 28, 2003AssetsIntangible assets 1,391.4 1,271.4Tangible assets 1,703.4 1,607.4Financial assets 359.3 357.9Non-current assets 3,454.1 3,236.7Inventories 617.5 1,557.6Receivables and other assets 871.7 603.8Securities and cash 396.5 427.5Current assets 1,885.7 2,588.9Total assets 5,339.8 5,825.7LiabilitiesSubscribed capitalof Südzucker AG 174.8 174.8Capital reservesof Südzucker AG 938.3 938.3Revenues reserves 739.2 712.11,852.3 1,825.2Minorities interests 382.9 395.8Shareholders' equity 2,235.2 2,221.0Provision for pensions 372.3 369.1Other accrued expenses 885.1 949.7Financial liabilities 1,223.0 1,435.7Other liabilities 624.2 850.2Total liabilities andshareholders' equity 5,339.8 5,825.7As of 31 August 2003, the balance sheet total of SüdzuckerGroup was D 485.9 million lower than on 28 February 2003. Thechief reason for this is the sale of the sugar inventory. The consolidationof the Silesian sugar factories and Vallø Saft and theaddition of the sugar quota acquired from Béghin Say resultedin a D 217.4 million increase in non-current assets. The equityratio increased to 41.9 % after 38.1 % on 28 February 2003. Asof 31 August 2003, net indebtedness of the Südzucker Groupwas D 826.5 million after D 1,008.2 million on 28 February 2003.F-83

GROUP STATEMENT OF INCOMED million 2nd quarter* 1st half year**2003/04 2002/03 2003/04 2002/03Sales 1,114.3 1,016.2 2,238.9 2,174.0Operating profit 118.4 121.3 232.4 235.0Restructuring costsand other items 13.9 (5.8) 9.8 (0.9)Amortisation of goodwill (17.6) (17.0) (35.0) (33.7)Income from ordinarybusiness activities 114.7 98.5 207.2 200.4Financial expense, net (8.2) (19.6) (29.6) (27.0)Earnings before income taxes 106.5 78.9 177.6 173.4Taxes on income (30.6) (11.6) (45.9) (36.7)Net Group earningsfor the period 75.9 67.3 131.7 136.7Minorities (16.0) (14.1) (28.0) (30.6)Net Group earnings forthe period after minorities 59.9 53.2 103.7 106.1Earnings per share (m) 0.35 0.32 0.60 0.63The positive result from restructuring and other items of D 9.8million in the first half year 2003/04 resulted from the Freseniusshare moving higher and changes in value of interest rate derivatives.The net financial result contains a participation result ofD 12.8 million, primarily from the participation at Ebro Pulevaincluded at equity and the interest result of (D 45.3 million).The earnings per share calculation (IAS 33) in the 2003/04 financialyear were based on 171,865,546 shares. In line with Article 160Par. 1 of the German Stock Corporation Act, the number of shareshas been reduced by 2,922,400.***1 June to 31 August1 March to 31 AugustF-84

STATEMENT OF CASH FLOWSD million1st half year**2003/04 2002/03Gross cash flow 213.2 233.9Change in netcurrent assets 359.2 456.8Net cash flow fromoperating activities 572.4 690.7Cash flow frominvesting activities (230.7) (116.3)Cash flow fromfinancing activities (372.7) (443.3)Change in cashand cash equivalents (31.0) 131.1Cash and cash equivalentsat the beginning of the period 427.5 428.9Cash and cash equivalentsat the end of the period 396.5 560.0The cash outflows from investment activities of D 230.7 millionrelate primarily to investments in tangible assets of D 168.3million (including the sugar quota of Béghin Say acquired by SLS)and investments in financial assets of D 97.4 million, predominantlythe acquisition of the Silesian sugar factories and ValløSaft.EQUITY SCHEDULEincluding minority interestsD million Group Minority TotalshareinterestsBalance at 1 March 2003 1,825.2 395.8 2,221.0Profit after tax 103.7 28.0 131.7Dividends (87.4) (14.5) (101.9)Other changes 10.8 (26.4) (15.6)Balance at 31 August 2003 1,852.3 382.9 2,235.2Balance at 1 March 2002 1,642.5 367.4 2,009.9Profit after tax 106.1 30.6 136.7Dividends (81.4) (11.1) (92.5)Other changes 3.6 (17.0) (13.4)Balance at 31 August 2002 1,670.8 369.9 2,040.7The dividend of D 0.50/share resolved at the Annual General Meetingon 31 July 2003 was paid out on 1 August 2003. This distributionresulted in shareholders’ equity declining by D 87.4 million.**1 March to 31 AugustF-85

SEGMENT REPORTINGD million 2nd quarter* 1st half year**2003/04 2002/03 2003/04 2002/03Sales 1,114.3 1,016.2 2,238.9 2,174.0Sugar 844.5 775.7 1,655.1 1,664.6Specialities 269.8 240.5 583.8 509.4Operating profit 118.4 121.3 232.4 235.0Sugar 92.2 97.1 167.5 182.3Specialities 26.2 24.2 64.9 52.7Operating margin 10.6 % 11.9 % 10.4 % 10.8 %Sugar 10.9 % 12.5 % 10.1 % 11.0 %Specialities 9.7 % 10.1 % 11.1 % 10.3 %Capital expenditure 67.5 53.9 168.3 92.4Sugar 39.9 35.7 129.2 59.7Specialities 27.6 18.2 39.1 32.7Average number of employees 16,250 12,968Sugar 12,770 9,795Specialities 3,480 3,173InvestmentsInvestments in tangible assets in the first half of 2003/04 totalledD 168.3 (PY: D 92.4 million). The increased investments in theSugar segment resulted largely from the SLS acquisition of BéghinSay’s sugar quota of 67,000 t.EmployeesIn the first half year 2003/04, the average number of employeesincreased year-on-year by 3,282 to 16,250. This is predominantlydue to the consolidation of the Silesian sugar factories and ValløSaft.***1 June to 31 August1 March to 31 AugustF-86

Changes in the Supervisory and Executive boardWith the end of the Annual General Meeting on 31 July 2003,Dr. Ulrich Weiss, Kronberg, retired from the Supervisory Board. Inhis place Mr Erwin Hameseder, Vienna, was elected to the SupervisoryBoard. Dr. Weiss had been a member of the SupervisoryBoard since October 1985. Until 1987 he was Chairman of theSupervisory Board, since then Vice Chairman of the SupervisoryBoard. Dr. Weiss was a member of the Presidential Committee ofthe Supervisory Board - and the Mediation Committee and wasChairman of the Social Committee. Mr Hameseder took a lawdegree at Vienna University. He is the chairman of Raiffeisen-Holding Niederösterreich-Wien.As of 1 September 2003, Prof. Markwart Kunz was appointed asa member of the Executive board. He succeeds Dr. Klaus Korn,who is retiring. On the Südzucker AG Mannheim/Ochsenfurt,Mannheim Executive board Prof. Kunz is responsible for Production/Engineering, Special products, R & D as well as purchasing forcapital goods and maintenance materials. He has been anemployee of the company since 1978, with responsibility forResearch/Development/Services since 1992. Since 1997 he hasalso been responsible for Sugar/Special Products.Important datesReport 3rd quarter 2003/0415 January 2004Accounting press conference and analysts’ conference2003/04 financial year26 May 2004Report 1st quarter 2004/0515 July 2004Annual General Meeting2003/04 financial year29 July 2004Report 2nd quarter 2004/0515 October 2004F-87

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Südzucker International Finance B.V.Financial Statements for the Financial YearsEnded February 28, 2003 and 2002F-89

STATEMENTS OF INCOME FOR THE FINANCIALYEARSENDED FEBRUARY 28, 2003 and 2002Financial Year2002/2003Financial Year2001/2002Notes(in 5) (in 5)Income from financing activitiesInterest income affiliated companies . . . . . . . 28,513,409 13,340,034Interest income swap . . . . . . . . . . . . . . . . . . . . 13 18,053,175 5,084,450Interest income bank account . . . . . . . . . . . . . 981,450 943,610Other income . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 2,653,556 1,411,73350,201,590 20,779,827Expenses from financing activitiesInterest expenses affiliated companies . . . . . 177,281 116,380Interest expenses Bonds . . . . . . . . . . . . . . . . . . 47,500,000 18,907,534Interest expenses third parties . . . . . . . . . . . . . 11,516 480,678Amortisation bond discount . . . . . . . . . . . . . . 854,500 547,690Other expenses . . . . . . . . . . . . . . . . . . . . . . . . . 15 811,276 406,25449,354,573 20,458,536Results from financing activities . . . . . . . . . . . 847,017 321,291Other expensesWages and salaries . . . . . . . . . . . . . . . . . . . . . . 16 43,884 42,684Social security and pension expenses . . . . . . 5,190 4,295Other operating expenses 17 41,992 44,62291,066 91,601Profit before taxation . . . . . . . . . . . . . . . . . . . . 755,951 229,690Taxation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (348,999) (139,572)Net profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 406,952 90,118F-90

BALANCE SHEETS AS OF FEBRUARY 28, 2003 AND 2002AssetsNotes 28 February 2003 28 February 2002(in 5) (in 5)Fixed assetsFinancial fixed assets . . . . . . . . . . . . . . 4 25,565 25,565Current assetsReceivables from affiliatedcompanies . . . . . . . . . . . . . . . . . . . . . 5 808,584,368 807,035,614Bonds discount . . . . . . . . . . . . . . . . . . . 6 6,747,488 7,601,988Other receivable/prepaid expenses . . 7 5,171 4,618815,337,027 814,642,220Cash at banks . . . . . . . . . . . . . . . . . . . . 8 101,461 130,843Total assets . . . . . . . . . . . . . . . . . . . . . . 815,464,053 814,798,628LiabilitiesShareholder’s equity 9Share capital . . . . . . . . . . . . . . . . . . . . . 453,780 453,780Retained earnings . . . . . . . . . . . . . . . . 416,492 326,374Profit financial year . . . . . . . . . . . . . . . 406,952 90,1181,277,224 870,272Long term liabilitiesBonds . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 800,000,000 800,000,000Current liabilitiesPayable to tax authorities . . . . . . . . . . 11 309,063 53,409Other payables . . . . . . . . . . . . . . . . . . . 12 13,877,766 13,874,94714,186,829 13,928,356Total equity and liabilities . . . . . . . . . . 815,464,053 814,798,628F-91

NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIALYEARENDED FEBRUARY 28, 2003General1 Group affiliation and principal activitySüdzucker International Finance B. V. was incorporated under Dutch law on 13 January 1994. Allshares were issued to Südzucker AG, Mannheim/Ochsenfurt.The principal activity of the company is that of a finance company.2 Basis of presentationThese financial statements have been prepared in accordance with the provisions of the NetherlandsCivil Code, Book 2, Part 9 and the accounting principles generally accepted in the Netherlands.3 Significant accounting policiesForeign currenciesIn the financial year 2002/2003 all transactions were concluded in Euro-related currencies. Therefore,no translation differences have occurred.Interest policyGenerally, interest risks are mitigated by the fact that conditions of intercompany loans handed out toaffiliated companies match the conditions of the funding received by SZIF B. V. regarding the timingand interest rates. In the case that the conditions of loans handed out and funding received do notmatch, the company uses interest swaps to mitigate the interest risk.Financial fixed assetsThe financial fixed assets are stated at cost.Assets and liabilitiesAssets and liabilities, other than those for which the basis of valuation is indicated on the balancesheet or notes thereon, are shown at face value.TaxationThe taxation charge for which the company is liable in the Netherlands complies with generalrequirements for financing companies in the Netherlands regarding a minimum net spread.Balance sheet4 Financial fixed assetsThe Sächsisch-Thüringische Zuckerfabriken Verwaltungsgesellschaft mbH (STZ) is a 100% subsidiaryof Südzucker International Finance B. V. with a subscribed capital of EUR 25,565 and has no activities.F-92

5 Receivables from affiliated companies28 February2003(in 5)28 February2002Loans to affiliated companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 775,000,000 795,920,000Interest receivable on loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 493,951 1,315,026Commitment fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . – 5,555Interest receivable swap (fixed part) . . . . . . . . . . . . . . . . . . . . . . . 37,176,750 10,881,833Interest payable swap (variable part) . . . . . . . . . . . . . . . . . . . . . . . (4,086,333) (1,086,800)808,584,368 807,035,614The loans to affiliated companies consist of:– EUR 570,500,000 which bears an interest percentage of 3.135% and expires on 13 March 2003;– EUR 44,500,000 which bears an interest percentage of 3.195% and expires on 13 March 2003;– EUR 60,000,000 which bears an interest percentage of 3.445 % and expires on 13 March 2003;– EUR 100,000,000 which bears an interest percentage of 2.995% and expires on 22 April 2003.The interest receivable and payable (swap) relate to two inter group swap agreements:– effective 21 July 2000 for a 10 year period. The group company pays a fixed interest rate of 5.99%per year on EUR 300 million, in exchange for a variable rate of interest of 3 Month EURIBOR onEUR 300 million paid by SZIF B. V.– effective 13 March 2002 for a 10 year period. The group company pays a fixed interest rate of5.43% per year on EUR 500 million, in exchange for a variable rate of interest of 3 MonthEURIBOR on EUR 500 million paid by SZIF B. V.Taking into account the interest swap long term and short-term interest effects of the basictransaction have been matched.6 Bonds discount28 February2003(in 5)Balance as at 1 March 2002:Bond discount at cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,545,000Cumulative amortisation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (943,012)Bond discount book value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,601,988Movements:Amortisation 2002/2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (854,500)Balance as at 28 February 2003:Bond discount at cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,545,000Cumulative amortisation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,797,512)Bond discount book value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,747,488The bond discounts will be amortised over a period of ten years and are related to the 6.25 % Bondissued 8 June 2000 and the 5.75% Bond issued 27 February 2002.F-93

7 Other receivables and prepaid expenses28 February2003(in 5)28 February2002Management fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,600 3,600Administration fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,240 –Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 331 1,0185,171 4,6188 Cash at banksCash at banks consists of a current account held with the Deutsche Bank AG, Amsterdam.9 Shareholders’ equitySharecapitalRetainedearningsProfitfinancialyearTotal(in 5)Shareholder’s equity as at 28 February/1 March 2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 453,780 169,452 156,922 780,154Appropriation of net result 2000/2001 . . . . . . . . . . . – 156,922 (156,922) –Net result for the year 2001/2002 . . . . . . . . . . . . . . . – – 90,118 90,118Shareholder’s equity as at 28 February/1 March 2002 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 453,780 326,374 90,118 870,272Appropriation of net result 2001/2002 . . . . . . . . . . . – 90,118 (90,118) –Net result for the year 2002/2003 . . . . . . . . . . . . . . . – – 406,952 406,952Shareholder’s equity as at 28 February 2003/1 March 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 453,780 416,492 406,952 1,277,224Referring to article 178c part 1 of the Netherlands Civil Code it should be noted that the authorisedshare capital of the company consists 50,000 common shares of EUR 45.378 each. According to thearticles of association the nominal value of the shares is NLG 100 per share. At 28 February 200310,000 shares were issued and fully paid in cash.The retained earnings represent the withheld profits of prior financial years.10 BondsAs per 8 June 2000 SZIF B. V. has issued a 6.25 % Bond with Deutsche Bank AG, Frankfurt am Main, foran amount of EUR 300 million for a 10-year period. This Bond has been issued against a rate of98.185% and cannot be redeemed before the expiry date. The Bond is guaranteed by Südzucker AG,Mannheim.As per 27 February 2002 SZIF B. V. has issued a 5.75% Bond with Deutsche Bank AG, Frankfurt amMain for an amount of EUR 500 million for a 10-year period. The Bond has been issued against a rateof 99.38% and cannot be redeemed before the expiry date. The Bond is guaranteed by Südzucker AG,Mannheim.F-94

11 Payable to tax authorities28 February2003(in 5)28 February2002Corporate tax for the financial year . . . . . . . . . . . . . . . . . . . . . . . . 348,999 139,572Prepaid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (87,986) (89,395)261,013 50,177Corporate tax relating to prior years . . . . . . . . . . . . . . . . . . . . . . . 47,478 3,232Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 572 –309,063 53,40912 Other payables28 February2003(in 5)28 February2002Accruals for holiday allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,281 1,099Accruals for holidays not taken . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,577 1,092Accrual for bonus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,013 10,013Advisory fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,059 13,228Auditor’s fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,900 13,127Commitment fee “Plazeuren” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,889 7,889Interest payable Bond . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,821,918 13,821,917Creditors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129 6,58213,877,766 13,874,947Profit- and loss account13 Interest income swapThe interest income swap can be specified as follows:2002/2003 2001/2002(in 5)Interest income swap (fixed part) . . . . . . . . . . . . . . . . . . . . . . . . . . 44,215,000 17,970,000Interest expenses swap (variable part) . . . . . . . . . . . . . . . . . . . . . . (6,161,825) (12,885,550)18,053,175 5,084,450There are two swap agreements:– effective 21 July 2000 for a 10 year period between a group company and SZIF, the groupcompany pays a fixed interest rate of 5.99% per year on EUR 300 million, in exchange for avariable rate of interest of 3 Month EURIBOR on EUR 300 million paid by SZIF B. V.– effective 13 March 2002 for a 10 year period between a group company and SZIF, the groupcompany pays a fixed interest rate of 5.43% per year on EUR 500 million, in exchange for avariable rate of interest of 3 Month EURIBOR on EUR 500 million paid by SZIF B. V.14 Other incomeThis item represents the commitment fees received from affiliated companies for their creditfacilities.F-95

15 Other expensesThis item mainly represents the commitment fee paid to Südzucker AG for their credit facility.16 Wages and salaries2002/2003 2001/2002(in 5)Wages (incl. management, holiday pay a. o.) . . . . . . . . . . . . . . . . 34,627 33,427Bonus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,257 9,25743,884 42,68417 Other operating expenses2002/2003 2001/2002(in 5)Administration fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,616 1,125Tax advisory fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,504 21,717Auditor’s fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,460 11,565Office expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,379 6,488Travelling expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 331 2,036Bank costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,313 1,323Other costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 389 36841,992 44,622The management fee is shown under wages and salaries.EmployeesFrom 1 March 2001 on, the company employed one employee (0.2 FTE).Remuneration directorsThe remuneration (incl. bonus) for the directors amounts to EUR 20,081 (financial year 2001/2002:EUR 20,057).Oud-Beijerland, 7 May 2003The Managing Directors:H. H. ScholtenG.P. NotaDeutsche International Trust Company N. V.F-96

DIRECTOR'S REPORT FOR THE FINANCIALYEARENDED FEBRUARY 28, 2003Südzucker International Finance B.V. (the company) was incorporated on 13 January 1994. Thecompany’s purpose is to finance affiliated companies through, among others, the issuance of publicloans.The company is contracted indefinitely.Activity during the financial year 2002/2003The company’s activities regarding the funding of companies of the Südzucker Group increasedsignificantly in the financial year 2002/2003, mainly caused by the EUR 500 million Bond issued at27 February 2002.To facilitate the loans to Südzucker Group companies, Südzucker International Finance B.V. has thefollowing facilities at its disposal:• the company is a party, by a deed of accession, in a Syndicated Credit Facility Agreement betweenDeutsche Bank Luxembourg S.A. and Südzucker AG, Mannheim. The total amount of this facility isDEM 500 million, it expires in 2003;• in May 1999 a Multi-Currency Commercial Paper Program was issued in co-operation withSüdzucker AG, Mannheim, with a maximum amount of EUR 500,000,000 with the DeutscheBank AG, Frankfurt, acting as agent.• On 8 June 2000 the company has issued a 6.25% Bond with the Deutsche Bank AG for an amountof EUR 300 million for a 10-year period.• On 27 February 2002 a 5.75% Bond has been issued with the Deutsche Bank AG for an amount ofEUR 500 million for a 10-year period.The above mentioned facilities have been guaranteed by Südzucker AG, Mannheim.There are no events occurred after 28 February 2003, which need to be recorded in these financialstatements.Oud-Beijerland, 7 May 2003The Managing Directors:H.H. ScholtenG.P. NotaDeutsche International Trust Company N.V.F-97

AUDITOR’S REPORTIntroductionWe have audited the financial statements of Südzucker International Finance B. V., Oud-Beijerland forthe year 1 March 2002 – 28 February 2003. These financial statements are the responsibility of theCompany´s management. Our responsibility is to express an opinion on these financial statementsbased on our audit.ScopeWe conducted our audit in accordance with auditing standards generally accepted in theNetherlands. Those standards require that we plan and perform the audit to obtain reasonableassurance about whether the financial statements are free of material misstatements. An auditincludes examining, on a test basis, evidence supporting the amounts and disclosures in thefinancial statements. An audit also includes assessing the accounting principles used and significantestimates made by management, as well as evaluating the overall presentation of the financialstatements. We believe that our audit provides a reasonable basis for our opinion.OpinionIn our opinion, the financial statements give a true and fair view of the financial position of thecompany as at 28 February 2003 and of the result for the year then ended in accordance withaccounting principles generally accepted in the Netherlands and comply with the financial reportingrequirements included in Part 9 of Book 2 of the Netherlands Civil Code.The Hague, 7 May 2003Ref.: E.P. MedemaF-98

SÜDZUCKER INTERNATIONAL FINANCE B.V.INTERIM REPORT FOR THE FIRST HALFOF THE FINANCIALYEAR 2003/04F-99

BALANCE SHEET AS OF AUGUST 31, 2003Notes 31 August 2003 28 February 2003(in 5) (in 5)AssetsFixed assetsFinancial fixed assets . . . . . . . . . . . . . . 25,565 25,565Current assetsReceivables from affiliatedcompanies . . . . . . . . . . . . . . . . . . . . . 4 815,224,413 808,584,368Bonds discount . . . . . . . . . . . . . . . . . . . 5 6,316,726 6,747,488Other receivable/prepaid expenses . . 4,287 5,171821,545,426 815,337,027Cash at banks 69,149 101,461Total assets . . . . . . . . . . . . . . . . . . . . . . 821,640,140 815,464,053LiabilitiesShareholder’s equityShare capital . . . . . . . . . . . . . . . . . . . . . 453,780 453,780Retained earnings . . . . . . . . . . . . . . . . 823,445 416,492Profit financial year . . . . . . . . . . . . . . . 370,973 406,9521,648,198 1,277,224Long term liabilitiesBonds . . . . . . . . . . . . . . . . . . . . . . . . . . . 800,000,000 800,000,000Current liabilitiesPayable to tax authorities . . . . . . . . . . 456,032 309,063Payable to affiliated companies . . . . . 408,889 –Other payables . . . . . . . . . . . . . . . . . . . 19,127,021 13,877,76619,991,942 14,186,829Total equity and liabilities . . . . . . . . . . 821,640,140 815,464,053F-100

PROFIT AND LOSS ACCOUNTFOR THE FIRST HALF OF THE FINANCIALYEAR 2003/041 March 2003 –31 August 20031 March 2002 –31 August 2002Notes(in 5) (in 5)Income from financing activitiesInterest income affiliated companies 11,331,921 15,210,207Interest income swap . . . . . . . . . . . . . . 12,580,306 8,306,517Interest income bank account . . . . . . 736 1,000Other income . . . . . . . . . . . . . . . . . . . . 1,512,889 1,159,77825,425,852 24,677,502Expenses from financing activitiesInterest expenses affiliatedcompanies . . . . . . . . . . . . . . . . . . . . . 0 5,781Interest expenses bonds . . . . . . . . . . . 23,945,205 23,945,205Interest expenses third parties . . . . . . 13,197 5,561Amortisation bond discount . . . . . . . . 430,762 430,762Other expenses . . . . . . . . . . . . . . . . . . . 409,163 5,72024,798,327 24,393,029Results from financing activities . . . . 627,525 284,473Other expensesWages and salaries . . . . . . . . . . . . . . . 24,018 22,188Social security and pensionexpenses . . . . . . . . . . . . . . . . . . . . . . 3,285 2,678Other operating expenses . . . . . . . . . . 18,670 18,37845,973 43,244Profit before taxation . . . . . . . . . . . . . . 581,552 241,229Taxation . . . . . . . . . . . . . . . . . . . . . . . . . – 210,579 – 173,360Net profit . . . . . . . . . . . . . . . . . . . . . . . . 370,973 67,869F-101

NOTES TO THE FINANCIAL STATEMENTSFOR THE FIRST HALF OF THE FINANCIALYEAR 2003/04General1 Group affiliation and principal activitySüdzucker International Finance B. V. was incorporated under Dutch law on 13 January 1994. Allshares were issued to Südzucker AG, Mannheim/Ochsenfurt.The principal activity of the company is that of a finance company.2 Basis of presentationThese financial statements have been prepared in accordance with the provisions of the NetherlandsCivil Code, Book 2, Part 9 and the accounting principles generally accepted in the Netherlands.3 Significant accounting policiesForeign currenciesIn the financial year 2002/2003 and 2003/2004 all transactions were concluded in Euro-relatedcurrencies. Therefore, no translation differences have occurred.Interest policyGenerally, interest risks are mitigated by the fact that conditions of intercompany loans handed out toaffiliated companies match the conditions of the funding received by SZIF B. V. regarding the timingand interest rates. In the case that the conditions of loans handed out and funding received do notmatch, the company uses interest swaps to mitigate the interest risk.Financial fixed assetsThe financial fixed assets are stated at cost.Assets and liabilitiesAssets and liabilities, other than those for which the basis of valuation is indicated on the balancesheet or notes thereon, are shown at face value.TaxationThe taxation charge for which the company is liable in the Netherlands complies with generalrequirements for financing companies in the Netherlands regarding a minimum net spread.F-102

Balance sheet4 Receivables from affiliated companies31 August2003(in 5)28 February2003Loans to affiliated companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 801,900,000 775,000,000Interest receivable on loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 331,024 493,951Commitment fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,431,111 –Interest receivable swap (fixed part) . . . . . . . . . . . . . . . . . . . . . . . 14,666,667 37,176,750Interest payable swap (variable part) . . . . . . . . . . . . . . . . . . . . . . . – 3,104,389 – 4,086,333815,224,413 808,584,368The loans to affiliated companies consist of:– EUR 556,900,000 which bears an interest percentage of 2.470% and expires on 15 September 2003;– EUR 109,000,000 which bears an interest percentage of 2.520 % and expires on 15 September 2003;– EUR 85,000,000 which bears an interest percentage of 2.470 % and expires on 15 September 2003;– EUR 51,000,000 which bears an interest percentage of 2.470 % and expires on 15 September 2003.The interest receivable and payable (swap) relate to two inter group swap agreements:– effective 21 July 2000 for a 10 year period. The group company pays a fixed interest rate of 5.99%per year on EUR 300 million, in exchange for a variable rate of interest of 3 Month EURIBOR onEUR 300 million paid by SZIF B. V.– effective 13 March 2002 for a 10 year period. The group company pays a fixed interest rate of5.43% per year on EUR 500 million, in exchange for a variable rate of interest of 3 MonthEURIBOR on EUR 500 million paid by SZIF B. V.Taking into account the interest swap long term and short-term interest effects of the basictransaction have been matched.5 Bonds discountBalance as at 1 March 2003:Bond discount at cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,545,000Cumulative amortisation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . – 1,797,512Bond discount book value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,747,488Movements:Amortisation 2003/2004 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . – 430,762Balance as at 31 August 2003:Bond discount at cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,545,000Cumulative amortisation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . – 2,228,274Bond discount book value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,316,726(in 5)The bond discounts will be amortised over a period of ten years and are related to the 6.25 % Bondissued 8 June 2000 and the 5.75% Bond issued 27 February 2002.F-103

Recent Developments and OutlookThe consolidated operating result for the 2003/04 financial year is likely to benefit from the highvolume of sugar produced in the past 2002 crop season and from the realisation of further synergyeffects deriving from the restructuring within the Südzucker Group. In addition, the acquisition of the67,000 tonnes maximum quota of BØghin Say is likely to yield positive results. Südzucker Group alsoexpects a continuation of the positive development in the specialties segment, both at Freiberger andin functional food. Due to this year’s long drought period in some regions, however, SüdzuckerGroup expects this year’s beet harvest and sugar production to be negatively affected. In thistransitional year for the Eastern European economies, Südzucker Group also expects lower earningsfrom its operations in these countries. The decline of the global sugar market price, compounded bythe weak US dollar, will also lead to a decline in earnings. Overall, Südzucker Group estimates thatthe positive developments will not fully offset these negative effects and consequently does notexpect to be able to match the operating result of the 2002/03 financial year.In respect of the net income for the year and earnings per share, Südzucker for 2003/04 anticipates anincrease compared to 2002/03, in view of an improved restructuring result and an expected reductionin goodwill amortizations ( 1 ), although the tax rate is set to normalise again because favourableeffects will not be recurring.Amsterdam and Mannheim, December 2003Südzucker International Finance B.V.Südzucker AG Mannheim/Ochsenfurt( 1 ) Based on the current official IASB schedule for introduction of Exposure Draft 3 (Business Combinations) as officialinternational accounting standard within the first quarter of 2004 and encouraging early application.G-1

Aufgrund des vorstehenden Prospekts sind die7 250.000.0003,00 % Wandelschuldverschreibungen von 2003/2008derSüdzucker International Finance B. V.Amsterdam, Niederlandemit Wandlungsrecht in auf den Inhaber lautendeStammaktien ohne Nennbetrag derSüdzucker AG Mannheim/OchsenfurtMannheimunbedingt und unwiderruflich garantiert durch dieSüdzucker AG Mannheim/Ochsenfurtan der Frankfurter Wertpapierböse zum amtlichen Markt zugelassen worden.ISIN: DE000A0AABH1Frankfurt am Main und München, im Dezember 2003Deutsche BankAktiengesellschaftBayerische Hypo- und Vereinsbank AGDZ BANK AGDeutsche Zentral-Genossenschaftsbank,Frankfurt am Main