Corporate Governance

Declaration of Conformity to the German Corporate Governance Code for the Financial Year 2007/2008

MAGIX AG Management Board and Supervisory Board attach great importance to the rules of legal Corporate Governance. Both institutions support the principle of proper and responsible company management as stated in the German Corporate Governance Code (short: the Code).

Since the last compliance statement from December 18, 2007, MAGIX AG has followed and continues to follow the recommendations of the "Governing Commission of the German Corporate Governance Code" in its version from June 14, 2007, or since its validity in the amended version from June 6, 2008 with the following exceptions:

• Consideration of the personal performance for the assessment of the variable remuneration of the members of the Management Board (Code, Section 4.2.2). The remuneration of the Board Members is dependent on their individual performance and tasks. A dependency on individual goals, however, is not intended for the evaluation of the variable remuneration. On the one hand the areas of responsibility of the members of the Management Board of MAGIX AG are interleaved to such extent that a definition of company goals for the corresponding areas of competence is not feasible. On the other hand the foundation for the success of the company is to be seen in the overall responsibility of the Management.

• Specification of a compensation cap when concluding Management Board agreements in the case of premature termination of management board activity (Code, Section 4.2.3, Sentence 4). The inclusion of a regulation concerning the payment of compensation in the event of premature termination of management board activity is not considered to be practical. It would be contradictory to the principle that agreements that have been entered into cannot be terminated prematurely. Further to this such a regulation is regarded to be unsuitable of meeting the individual circumstances. Finally, such a limitation could not be enforced on the side of the company alone.

• Age limit of the Management Board (Code, Section 5.1.2). Due to the age structure of the Management Board of MAGIX AG, such regulation is currently deemed unnecessary.

• Formation of Supervisory Board committees (Code, Sections 5.3.1, 5.3.2). The Supervisory Board of MAGIX AG currently consists of three board members, making it impossible to form committees.

• Definition of performance-related remuneration of the Supervisory Board (Code, Section 5.4.6). It is the opinion of the company that the Supervisory Board will fulfil its legal obligation as an independent supervisory body better without its remuneration being linked to the success of the company, as this serves to guarantee interest neutrality.

• Publication of the consolidated financial statement and interim reports within the limits set forth in the Code (Code, Section 7.1.2). The company will publish preliminary, unaudited quarterly and semi-annual results within the time limits set forth in the Code. With regard to the consolidated financial statement and interim reports, however, the company regards the requirements as sufficient for companies listed in the Prime Standard of the Frankfurt Stock Exchange.

On this page you will also find information on the Stock currently held by board members, the Transactions by members of the Management Board of MAGIX AG subject to notification, the salary of the Management Board and the Supervisory Board as well as information regarding the Stock Option Plan.

The current version of the German Corporate Governance Code can be found here.

Stock currently held by board members

At the time of the report's publication, the stock currently held by the members of the Management Board and the Supervisory Board was as follows:

* Jürgen Jaron and Dieter Rein each hold 50% of the limited partnership capital of Presto Capital Management GmbH & Co. KG. Accordingly, Jürgen Jaron and Dieter Rein collectively hold, either directly or indirectly, approximately 51.12 % of the voting rights in the Company.

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Transactions by Board members of the MAGIX AG subject to notification since September 30, 2007:

During the period of the report, the following transactions subject to notification have been conducted by Board members of MAGIX AG.

Remuneration of the Management Board

The members of the Management Board receive an annual remuneration that consists of success-related, success-independent as well as long-term success-dependent elements.

Members of the Management Board receive a fixed salary irrespective of the success of the company as well as fringe benefits. Such mainly include use of a company car, travel expenses and telephone costs. The bonus is determined by the Supervisory Board based on the revenue and revenue goals for the current fiscal year. In the event of extraordinary achievements, the Supervisory Board may also approve a special bonus. The long-term performance-related pay results from the appointed stock option rights corresponding to the stock option plan approved in the shareholders' meeting.

In the financial year 2007/2008 the remuneration of the members of the Management Board amounted to kEUR 885 in total. Success-independent components comprised kEUR 444 (fixed salaries: kEUR 421, fringe benefits: kEUR 23). Bonuses totaling kEUR 441 were paid. No stock options rights were allotted to the Management Board members during the period of the report. Loans or similar services were not given. In addition, Board members were not promised or granted benefits by third parties with regard to their activity as members of the Management Board.

The remunerations were apportioned as follows (in kEUR):

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Remuneration of the Supervisory Board

In accordance with Section 13, paragraph 1 of the MAGIX AG Articles of Association concluded at the shareholders' meeting, the Supervisory Board of the company is to receive a fixed remuneration per financial year. This is to be decided at the shareholders' meeting. Furthermore, the expenses of the Supervisory Board will be refunded. These also include the value added tax added to the remuneration insofar the member of the Supervisory Board is entitled to invoicing VAT separately. In addition, an appropriate liability insurance (D&O insurance) for the members of the Supervisory Board has been purchased at the expense of the company.

The following remuneration is paid to the members of the Supervisory Board (in kEUR):

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Stock option plan

No stock options were granted to employees of MAGIX AG in the 2007/2008 fiscal year.