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Software AG GB 2013. englisch

GroupManagementReport In November 2012 Management Incentive Plan IV was ad- justed to reflect changed strategic targets, which required major investments in growth and a stronger focus on the cloud business. The Company therefore took the cloud com- puting megatrend into account in its calculations of relevant revenue. This means that the cloud revenue that is gener- ated on a pro rata subscription basis is recognized with a multiplying factor; IFRS revenue from new products must however be at least €450 million in fiscal year 2015. Instead of doubling net income, it was determined that the Soft- ware AG Group’s publicized non-IFRS EBIT margin must be at least 10 percent respectively by 2015, whereby under- performance of the non-IFRS EBIT margin may be balanced out by an appropriate outperformance of the revenue per- formance target. In accordance with the adjustment of long- term performance targets, only a lineal increase of new product revenue will be included in the medium-term per- formance target. Furthermore, participants of MIP IV can be paid an annual bonus on exercisable but unexercised options in the amount of the dividend approved at the respective Annual Shareholders’ Meeting. This must be reapproved every year. c) Management Incentive Plan IV 2011-2016 (MIP IV) After Software AG had met the secondary conditions of MIP III (2007-2011) in 2010, it was necessary to launch a new long-term success-based incentive plan. Accordingly, a share-based incentive plan for members of the Manage- ment Board and executive managers was launched in the second quarter of 2011. A total of 1,655,000 ownership rights were issued to members of the Management Board as of December 31, 2013. If performance targets are reached by fiscal year 2015, the holders of these ownership rights are entitled to a payment of the value by which the Soft- ware AG stock surpasses the base price. This entitlement is valid until June 30, 2021. The base price for ownership rights issued thus far is €41.34. The defined long-term perfor- mance target involves doubling Group revenue for new products and net income compared to fiscal year 2010 by no later than 2015. “New products” as defined for the rev- enue performance target are mainly all products outside of the Adabas, Natural and EntireX product portfolios. The plan includes a medium-term performance target that requires that the long-term doubling of new product revenue and net income must be achieved along a lineal progression of at least 15 percent per year. If annual growth in revenue from new products or net income is less than 10 percent during one year, the total ownership right award will be reduced on a pro rata basis by 0.5 percent for every per- centage point under 10 percent. The reduction can be re- covered with growth greater than 15 percent annually in the following years. But the original award cannot be in- creased. The rights can be exercised for the first time four years after they were allotted. An additional condition for exercising rights was defined whereby Software AG’s stock price must be at least €60 on one of the five trading days before rights are exercised. 111 Corporate Governance Report of the Supervisory Board Consolidated Financial Statements Notes Additional Information Group Management Report Business and General Conditions Economic Report Events after the Balance Sheet Date Risk and Opportunity Report Remuneration Report Forecast Takeover-Related Disclosures Statement on Corporate Governance