E_mg_GB_03_vorne-29_3_04

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Eligible executives had the right to convert the option rights into shares of mg technologies ag at a
ratio of 1 for 1. The purchase rights may only be exercised during a period of four weeks following
the Annual Shareholders’ Meeting in the third fiscal year after the option rights have been issued.
The aim of the program is to increase average pre-tax earnings per share (pre-tax EPS) during the
three-year period between subscription and exercise of such rights (EPS performance value) in relation
to average pre-tax EPS during the three years prior to subscription (base EPS value). This quotient
constitutes the profit increase factor. The options can only be exercised if the EPS performance value
exceeds the base EPS value, i.e. if the profit increase factor is at least 1 (program target).
The purchase price for one mg no par value share is determined by dividing the share’s market price
by the profit increase factor at the time of exercise. The applicable market price is the mean of the
closing prices for the share in Xetra trading on the Frankfurt Stock Exchange over the five trading
days following the Annual Shareholders’ Meeting of mg technologies ag in the year of the respective
exercise.
In June 2000, those eligible had the opportunity to decide whether to participate in the stock option
program. To this end, mg technologies ag issued 1,410,000 option rights (2000/2003) in July 2000
(tranche III). Eligible participants were able to exercise the option rights after the 2003 Annual Shareholders’
Meeting. All option rights remaining after employees had left the company in the meantime
were exercised, so that there were no option rights from the program outstanding at December 31, 2003.
In April 2001, those eligible again had the opportunity to decide whether to participate in the stock
option program. To this end, mg technologies ag issued 1,557,000 option rights (2001/2004) in July
2001 (tranche IV). Eligible participants can exercise the option rights after the Annual Shareholders’
Meeting in 2004 provided the program target is met. The number of option rights issued in this
tranche fell to 1,109,000 at December 31, 2003 owing to the fact that some eligible participants had
left the company. This was the first time that the program target was not achieved; the profit increase
factor was less than 1. The eligible participants were therefore unable to exercise their option rights,
and all 2001/2004 option rights thus expired.
In April 2002, those eligible had a further opportunity to participate in the stock option program.
To this end, mg technologies ag issued 1,633,000 option rights (2002/2005) in June 2002 (tranche V).
Eligible participants can exercise the option rights after the Annual Shareholders’ Meeting in 2005
provided the program target is met. The number of option rights issued in this tranche fell to
1,249,000 at December 31, 2003 owing to the fact that eligible participants had left the company.
In June 2003, those eligible had their final opportunity to participate in the stock option program.
To this end, mg technologies ag issued 1,464,000 option rights (2003/2006) in July 2003 (tranche VI).
Eligible participants can exercise the option rights after the Annual Shareholders’ Meeting in 2006
provided the program target is met. The number of option rights issued in this tranche fell to
1,396,000 at December 31, 2003 owing to the fact that eligible participants had left the company.
Despite the fact that mg has aligned its fiscal year with the calendar year, the outstanding tranches of
the stock option program will continue to be based on a 12-month period ending on September 30.
The 2003/2006 tranche was the last one to grant stock options based on the resolution adopted by
the Annual Shareholders’ Meeting on March 31, 2000.