Continental AG — Capital/Financing Update 2004

May 4, 2004

News Details

Ad-hoc | 4 May 2004 07:52

Ad-hoc: CONTINENTAL AG issues 7 year convertible bond

Ad-hoc-announcement transmitted by DGAP. The issuer is solely responsible for the content of this announcement. ——————————————————————————– Not for release in the United States, Canada, Italy or Japan Ad-hoc: CONTINENTAL AG issues 7 year convertible bond Hanover, 04 May 2004 The management board of Continental AG has decided, with the approval of the supervisory board, to issue through its Dutch subsidiary Conti Gummi Finance B.V. Euro 350 million senior convertible notes (with an up to Euro 50 million greenshoe option). The notes will be guaranteed by Continental AG and will be convertible, subject to adjustments, into approx. 8.5 million shares of Continental AG. The convertible notes have a maturity of seven years and cannot be called for the first five years of their term; thereafter, they will be callable subject to a 130 per cent provisional call. Pre-emptive rights of existing shareholders of Continental AG shall be excluded. The convertible notes will be marketed with a coupon range of 1.625 per cent to 2.125 per cent and a conversion premium range of 37 per cent to 42 per cent solely to institutional investors outside the United States, Canada, Italy and Japan in reliance on Regulation S under the U.S. Securities Act of 1933. The final terms will be determined via a bookbuilding process later today. Continental intends to list the convertible notes on the Luxembourg stock exchange. Morgan Stanley Bank AG and Citigroup are acting as joint bookrunners to the transaction and Morgan Stanley Bank AG and its agents will be Stabilisation Manager for the offering (Stabilisation/FSA and German law). Continental AG is issuing the convertible notes through its financing subsidiary to benefit from the attractive financing opportunity available in the current convertible market. The proceeds of the issue will be used to support the long- term strategy of Continental AG. end of ad-hoc-announcement (c)DGAP 04.05.2004 Issuer’s information/explanatory remarks concerning this ad-hoc-announcement: Disclaimer: This ad hoc publication is for information purposes only and is not an offer to sell, or the solicitation of an offer to buy, any securities. In connection with this transaction there has not been, nor will there be, any public offering of the convertible bonds of Conti Gummi Finance B.V. (“Bonds”). The distribution of this ad hoc publication and the offer and sale of the Bonds in certain jurisdictions may be restricted by law. Any persons reading this ad hoc publication should inform themselves of and observe any such restrictions. This ad hoc publication does not constitute an offer to sell or a solicitation of an offer to purchase any securities in the United States. The Bonds and the shares of Continental AG referred to in this ad hoc publication have not been and will not be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States or to or for the benefit of United States persons, except pursuant to an applicable exemption from registration. This ad hoc publication and the information contained herein should not be distributed or sent into the United States of America, Canada, Italy or Japan and should not be distributed to United States persons or publications with a general circulation in the United States. No offering of the Bonds is being made in the United States. No action has been or will be taken in the Federal Republic of Germany that would permit a public offering of the Bonds or the shares of Continental AG, or distribution of a prospectus or any other offering material relating to these securities. In particular, no sales prospectus (Verkaufsprospekt) within the meaning of the German Securities Selling Prospectus Act (Wertpapier- Verkaufsprospektgesetz) of September 9, 1998, as amended, (the “German Securities Selling Prospectus Act”) has been or will be published within the Federal Republic of Germany. Accordingly, any offer or sale of the Bonds within the Federal Republic of Germany may only be made based on an exemption from the prospectus publication requirement under the German Securities Selling Prospectus Act. This ad hoc publication is directed only at persons who (i) are outside the United Kingdom or (ii) are in the United Kingdom and either have professional experience in matters relating to investments or are high net worth companies, unincorporated associations etc for the purposes of Article 49 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2001 (all such persons together being referred to as “relevant persons”). This ad hoc publication must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this ad hoc publication relates is available only to relevant persons and will be engaged in only with relevant persons. In connection with the issue of the Bonds, Morgan Stanley Bank AG and its agents may over-allot Bonds. Furthermore, from the announcement of final terms of the issue of the Bonds, Morgan Stanley Bank AG and its agents may effect transactions with a view to supporting the market price of the Bonds and the shares of Continental AG at a level higher than that which might otherwise prevail for a limited period. If commenced, such stabilizing may lead to a market price of the Bonds or the shares of Continental AG, which may be higher than the level that would exist if no such stabilizing measures were taken and may indicate to the market a price stability, which might not otherwise prevail. However, there is no obligation on Morgan Stanley Bank AG and its agents to engage in such stabilization activities and such stabilization, if commenced (which may only occur after the final terms of the Bonds have been announced), may be discontinued at any time and will end two Frankfurt and London business days prior to the day of settlement. Stabilisation/FSA and German law ——————————————————————————– WKN: 543900; ISIN: DE0005439004; Index: DAX Listed: Amtlicher Markt in Berlin-Bremen, Düsseldorf, Frankfurt (Prime Standard), Hamburg, Hannover, München, Stuttgart; Wien und Swiss Exchange (Hauptsegment);Börse Luxembourg 040752 Mai 04