Remuneration of the Executive Board is made up of a basic remuneration plus variable components. At least two-thirds of the remuneration is performancerelated and is based on sales, earnings and other corporate targets. A portion of the variable remuneration is paid as a long-term component on the basis of a phantom share plan. Furthermore, Software AG offers a stock option plan to Executive Board members and officers.

Members of the Supervisory Board receive both fixed and performance-related remuneration. The variable components are linked to the success of the Company, measured by the ratio of earnings before taxes as a percentage of sales (EBT margin). On January 1, 2006, a long-term performance-related component was added to the remuneration of the Supervisory Board.

Details on remuneration for the Executive and Supervisory Boards are portrayed in the Corporate Governance Report and the Notes.