Subscribed capital and voting rights

Software AG’s share capital totals €84,338,145 and is divided into 28,112,715 bearer shares. Each share represents €3.00 of the issued share capital and entitles the holder to one vote. Shareholders can exercise their rights at the Annual Shareholders’ Meeting, when they exercise their voting rights in accordance with legal stipulations and the Company’s Articles of Incorporation.

Authorized capital and share repurchase

Software AG has authorized capital of €41,804 thousand. The Executive Board is authorized, with the consent of the Supervisory Board, to increase the Company’s share capital on one or more occasions on or before May 12, 2011 by issuing up to 13,934,544 new bearer shares against cash contributions or contributions in kind.

In the event of a capital increase against contributions in kind that occurs in connection with an acquisition, the Executive Board has restricted any exclusion of subscription rights to a maximum of 5.6 million shares.

The Company is also authorized to acquire treasury shares having a share in the issued share capital not to exceed €8,411 thousand on or before November 11, 2007. However, the theoretical interest in the shares acquired under this authorization, together with any other company shares already acquired and still held by the Company, may at no time exceed 10 percent of share capital.

Please refer to the Notes for additional information on the authorized capital and the acquisition of treasury stock.

Significant shareholders

The Software AG foundation, with registered offices in Darmstadt, holds approximately 30 percent of the shares in Software AG.

Appointment/dismissal of Executive Board members and changes in the Articles of Incorporation

Executive Board members are appointed and dismissed in accordance with Section 84 et seqq. of the German Stock Corporation Act.

Any changes in the Articles of Incorporation are resolved by the Annual Shareholders’ Meeting by a majority of at least three-fourths of the share capital represented at the time of the resolution in accordance with Section 179 of the German Stock Corporation Act. Changes in the wording of the Articles of Incorporation in connection with the utilization of conditional and authorized capital were resolved by the Supervisory Board in accordance with resolutions of the Annual Shareholders’ Meetings of September 21, 1998 (Section 5, Paragraphs 1 and 2 of the Articles of Incorporation); April 27, 2001 (Section 5, Paragraphs 1 and 3 of the Articles of Incorporation); May 13, 2005 (Section 5, Paragraphs 1 and 4 of the Articles of Incorporation); and May 12, 2006 (Section 5, Paragraphs 1 and 5 of the Articles of Incorporation).