EUR 1000.00 For Business Accounts Only

Continental - AGM 14 July 2020

General: The AGM is to be held in the form of a virtual AGM in accordance with the German Law to Mitigate the Consequences of the COVID-19 Pandemic. The physical presence of shareholders or their authorised proxies is not possible. The voting rights may therefore be exercised solely by postal vote or by granting authority to the proxies designated by the Company.

Item 2: Management and Supervisory Board are proposing a dividend of EUR 3.00 per share (decreased by 36.84% from EUR 4.75). On 3 June 2020, the Management Board and the Supervisory Board resolved to adjust their initial proposal on the appropriation of net profits of the financial year 2019 in light of the COVID-19 pandemic. The initial proposal provided for the payment of a dividend of EUR 4.00 per share. On 1 April 2020, the Company had already withdrawn its outlook for financial year 2020 due to the uncertainty regarding the duration of restrictions caused by the pandemic and the related possible consequences for production, the supply chain and demand. In view of the recent events relating to COVID-19, ECGS is in favour of postponing decisions on the dividend, reductions or suspensions that would allow companies to avoid liquidity risks or not generate risk for their survival and therefore supports the payout of a significantly reduced dividend. We note that the dividend is covered by free cash flow but is not covered by earnings (EPS: EUR -6.13). Should this situation persist in the future (declining cash flow or increase in debt in the absence of any other developments) we may revisit our recommendation. In line with our guidelines we recommend support.

Item 4.24: We recommend to oppose the discharge of Supervisory Board member Prof. KR Ing. Siegfried Wolf due to his insufficient attendance at Supervisory Board meetings in financial year 2019.

Item 5: KPMG, Hanover, is proposed as auditor for the current financial year. We have no concerns over the ratio of non-audit/audit fees. However, we note that KPMG or its predecessor have audited the Company since at least the financial year 1975 (no earlier data available) which significantly exceeds our maximum acceptable term of office. We therefore recommend opposing the re-election of KPMG as auditor.

Item 6: We recommend to oppose the approval of the remuneration system for the Management Board members due to concerns over insufficient disclosure which fails to enable us to assess the remuneration structure under the new system.

Item 7: We recommend to oppose the approval of the remuneration of the Supervisory Board members and the related amendments to the Company's Articles of Association as we assess the absolute amount of remuneration as significantly exceeding market practice.