Entsprechenserklärung 12/2006 (EN)

Declaration of conformity of Kontron AG to the German Corporate Governance Code as per § 161 of the Stock Corporation Act (AktG)

In accordance with § 161 of the Stock Corporation Act, the Management and Supervisory Boards of Kontron AG hereby issue the following declaration of conformity to the recommendations of the "Government Commission on the German Corporate Governance Code":

1. Kontron AG will conform to the recommendations of the German Corporate Governance Code in the version of June 12, 2006, with the following exceptions:

a. The Company has currently no agreement in place for the members of the Supervisory Board concerning a deductible for the D&O insurance (Code Figure 3.8 Paragraph 2).

While the Company has agreed an appropriate deductible with the members of the Management Board on the basis of individual agreements, a corresponding agreement is currently not in place for the members of the Supervisory Board.

The Management and Supervisory boards are of the view that the agreement of a deductible for the Supervisory Board is currently not justified due to the low level of the remuneration scheme at Kontron AG.

b. Although the remuneration of Management Board members comprises fixed and short-term variable components, it does not contain variable components with long-term incentive effects (Code Figure 4.2.3, Paragraph 2, Clause 2).

The Management and Supervisory boards are of the view that the members of the Management Board of Kontron AG do not require variable remuneration components with long-term incentive effects since they are already to a considerable extent stakeholders in Kontron AG as either shareholders or owners of options. This approach ensures their orientation towards the long-term success of Kontron AG. The incentive effect is also linked to the overall success of the Kontron Group and not solely to individual parameters for success that have relevance for remuneration. As co-shareholders, it is ensured that the interests of the management and other shareholders run in parallel, which is the aim of remuneration components with long-term incentive effect. No additional incentives are required.

c. The Code envisages that the presentation of the actual structure of an equity option plan or comparable structures for components with long-term incentive effects should report their values (Code Figure 4.2.5 Paragraph 2 Clause 1).

The Management and Supervisory boards are of the view that disclosure of the number of equity options issued is sufficient. They regard disclosure of the value of the options as unnecessary.

2. Since the last declaration of conformity issued in March 2006, Kontron AG has conformed in principle with the recommendations of the German Corporate Governance Code. From the Code as of June 12, 2006, the following recommendations have not been applied: from Figures 3.8 Paragraph 2, 4.2.3 Paragraph 2 Clause 2, 4.2.5 Paragraph 2 Clause 1, 5.5.3 Clause 2 and 5.4.7 Paragraph 3. From the recommendations of the Code as of June 2, 2005 the following recommendations have not been applied: from Figures 3.8 Paragraph 2, 4.2.3 Paragraph 1 Clause 2, 4.2.3 Paragraph 3 Clause 2, 5.5.3 Clause 2 and 5.4.7 Paragraph 3.

Eching, December 2006
The Management and Supervisory boards of Kontron AG

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