Share-based payment Performance Share Plan

Effective July 1, 2006, GEA Group Aktiengesellschaft launched a long-term remuneration program entitled “GEA Performance Share Plan” for all first- and second-level managers below the Executive Board. Third-level managers were also eligible to participate starting with the third tranche of the program as of July 1, 2008. The sixth tranche was issued on July 1, 2011. The goal of the GEA Performance Share Plan is to link managers’ remuneration with the long-term success of the Company and to align their interests with those of the shareholders.

Under the plan, participants are granted a defined number of Performance Shares at the beginning of the performance period. The number of Performance Shares allotted is determined by the participants’ length of service. The Performance Shares must then be held for three years (performance period). To participate in the plan, managers must invest 20 percent of the amount of the allotted Performance Shares in shares of GEA Group Aktiengesellschaft. The performance of GEA Group Aktiengesellschaft’s shares relative to all other MDAX companies over the three-year performance period is measured on the basis of their total shareholder return (TSR). TSR is a suitable indicator for investors to compare the performance and appeal of different companies. It measures the total percentage return that an investor earns from a share over a certain period. In addition to share price performance, dividends and adjustments such as share splits are included in the calculation of TSR. This method of comparison eliminates share price performance that is due to general market volatility and enables the effects of different profit retention strategies to be compared. The relative performance of GEA Group Aktiengesellschaft’s shares determines the number of Performance Shares finally paid out (between 0 percent and 300 percent).

The Performance Shares are paid out once the three-year performance period has expired. At that time, performance of GEA Group Aktiengesellschaft’s shares relative to the MDAX determines how many Performance Shares are paid out: If the performance of the Company’s shares equals the median in a TSR comparison, 50 percent of the Performance Shares are issued; if it reaches the third quartile, 100 percent of the Performance Shares are paid out. If GEA Group Aktiengesellschaft’s shares outperform all other MDAX companies, 300 percent of the Performance Shares are issued. Other performance figures are interpolated between these values. The total amount paid out corresponds to the number of Performance Shares allotted to a participant multiplied by the average share price over the last quarter of the three-year performance period. Once the performance period has expired, participants may freely dispose of their GEA Group Aktiengesellschaft shares.

The third tranche expired on June 30, 2011. Since the TSR over the three-year performance period was below the median at 5.96 percent, there was no payout for the third tranche. In the previous year, the TSR was 3.75 percent above the median, resulting in a payout ratio of 63.09 percent. The payout amounted to EUR 717 thousand.

The number of Performance Shares changed as follows in fiscal year 2011:

(Number of shares) 12/31/2010 Additions Expired Paid Out 12/31/2011

2008 tranche 159,500 – 159,500 – –

2009 tranche 333,450 – 12,150 – 321,300

2010 tranche 242,400 – 5,010 – 237,390

2011 tranche – 184,798 – – 184,798

Total 735,350 184,798 176,660 – 743,488

The total expense for fiscal year 2011 amounts to EUR 5,549 thousand (previous year: EUR 2,165 thousand), taking into account the fair value as of December 31, 2011, of EUR 21.21 (previous year: EUR 14.51) for the fourth tranche, EUR 20.65 (previous year: EUR 12.49) for the fifth tranche, EUR 17.08 for the sixth tranche, and EUR 0 (previous year: EUR 10.59) for the third tranche (previous year: second tranche) at the payment date.

Notes to the Consolidated Financial Statements

The fair value of the Performance Shares is determined using a multidimensional Monte Carlo simulation. The following valuation assumptions are applied:

2011 2010

Tranche 2009 2010 2011 2008 2009 2010

Share price (EUR) 22.59 22.20 21.85 22.93 22.00 21.63

Dividend yield (%) 1.615 1.615 1.615 1.726 1.726 1.726

Risk-free interest rate (%) 0.101 0.055 0.248 0.454 0.703 1.060

Volatility GEA shares (%) 44,38 44,38 44,38 35,43 35,43 35,43

As the payout ratio of GEA Group Aktiengesellschaft’s Performance Shares is linked to the MDAX, the volatilities of all MDAX shares and their correlations to GEA Group Aktiengesellschaft shares are also calculated.

The obligation under the plan amounted to EUR 8,687 thousand as of December 31, 2011 (previous year: EUR 3,027 thousand). The noncurrent portion is reported under provisions for other obligations to employees and the current portion under provisions for bonuses. Phantom shares

The bonus arrangements for Executive Board members were modified in fiscal year 2010 and a long-term incentive component was added. Half of the bonus calculated under the new arrangements is payable with the next regular salary payment following the date of the Company’s Supervisory Board meeting convened to adopt the financial statements for the preceding fiscal year. If the targets are exceeded, this part of the bonus is limited to an amount of 75 percent of the annual basic bonus. The other half of the bonus is converted into phantom shares of the Company. It is calculated as the arithmetic mean of the daily closing prices of GEA Group shares in Xetra trading operated by the Frankfurt Stock Exchange on the market days in the three-month period that ends one month before the date of the Supervisory Board meeting convened in the fiscal year to adopt the financial statements. The quantity of phantom shares to be granted for a fiscal year is thus only calculated in the following year.

The payout value of the phantom shares is calculated following the expiration of a lock-up period of three years following the conversion into phantom shares. The amount of the payout is calculated as the arithmetic mean of the daily closing prices of GEA Group Aktiengesellschaft shares in Xetra trading operated by the Frankfurt Stock Exchange on the market days in the three-month period that ends one month before the date of the relevant Supervisory Board meeting convened to adopt the financial statements in the fiscal year in which the lock-up period expires. The dividends payable per share during the lock-up period are added to the value calculated in this way. The amount to be paid out under these arrangements is limited to 300 percent of the annual basic bonus. In the event of termination of the Executive Board member’s contract of service, the three-year vesting period is reduced to one year as from the date of termination.

Because the exercise price is zero and the incentive program does not feature a vesting period, the fair value of the phantom shares corresponds to their intrinsic value and thus to the quoted market price of GEA Group Aktiengesellschaft shares at the reporting date. The fair value of the liability is calculated by multiplying the number of phantom shares by the relevant closing price, plus dividends paid during the lock-up period.

The number of phantom shares changed as follows in fiscal year 2011:

(Number of shares) 12/31/2010 Additions Expired Paid Out 12/31/2011

2010 tranche 57,887 – – – 57,887

2011 tranche – 81,534 – – 81,534

Total 57,887 81,534 – – 139,421

The relevant price for the phantom shares issued in 2010 is EUR 22.25 (previous year: 21.63), and EUR 21.85 for phantom shares issued in 2011. This results in a total liability of EUR 3,070 thousand (previous year: EUR 1,252 thousand). The amount of the liability is included in the noncurrent employee benefit obligations under bonuses.