Appendix ANNEX I

Corporate governance: The Federal Government and Sparkasse KölnBonn undertake that Sparkasse KölnBonn will make the following amendments to its corporate governance:

1. (a)

   The number of external members of the Supervisory Board is to be increased from the current two members to four as of 1 January 2011. The total number of Supervisory Board members is to be restricted to 18.

2. (b)

   The Supervisory Board of Sparkasse KölnBonn is to appoint only the following committees in future and to reduce their members to the number stipulated no later than on 1 January 2011.

   • Accounting committee (seven members)

   • Risk committee (six members)

   • Main committee (three members)

3. (c)

   The Strategy committee and the Investment committee are to be abolished no later than on 31 December 2010 and 31 December 2011 respectively.

4. (d)

   All members of the Supervisory Board are to possess the abilities stipulated in the first sentence of §36(3) of the German Banking Act.

5. (e)

   With effect from 1 January 2011 the Management Board of Sparkasse KölnBonn is to tighten the guidelines for investment decisions as follows: The Management Board will be able to take investment decisions only if there is unanimity and — in the case of investments over a nominal value of EUR [2-5] million — following a due diligence check involving an auditor, if necessary.

Proprietary trading: Sparkasse KölnBonn is to cease trading for its own account. This means that Sparkasse KölnBonn is only to carry out transactions that either

1. (a)

   are necessary to receive, transmit and carry out its clients’ orders to buy and sell; or

2. (b)

   help the savings bank perform liquidity or risk management.

Under no circumstances is Sparkasse KölnBonn to create positions on its own account, unless they arise because Sparkasse KölnBonn, for example, does not carry out certain customer orders straight away. Positions of this kind and the liquidity/risk management positions are allowed only if they do not jeopardise the Bank’s viability and/or liquidity. Sparkasse KölnBonn is therefore to limit the market risk of its trading portfolio to EUR [3-5] million (Value at Risk at a confidence level of 99 %).

Lending to the economy: Through its lending and investment activities, conducted under normal market conditions that meet supervisory and banking industry requirements, Sparkasse KölnBonn is to meet the borrowing needs of the business sector, particularly of SMEs.

As part of its reorientation, Sparkasse KölnBonn is to gradually reduce its large credit exposures in the area of corporate banking in order to reduce the associated risks. The measures include, among other things, limiting the credit lines, requesting additional collateral or transferring risks to other credit institutions.

By the end of 2013 Sparkasse KölnBonn is to reduce its large credit exposures by EUR [900-1 100] million, of which EUR [400-550] million should already be achieved by the end of 2010. Cash credits granted to institutional clients, who are not connected to the Cologne-Bonn region, are to be reduced by EUR [800-900] million by the end of 2013.

Price leadership ban: Until 31 December 2014 Sparkasse KölnBonn is not, without the prior authorization of the Commission, to offer more favourable prices on the relevant markets for deposit-taking […] and for long-term mortgage loans […] than its best-priced competitor among the top 10 market players in terms of market share^f1 in the relevant market.

As soon as Sparkasse KölnBonn becomes aware that it is offering more favourable prices than its best-priced competitor, it will immediately adjust its prices accordingly.

Dividend and coupon ban: Germany undertakes, with regard to coupon payments and call options on capital instruments, that

1. (a)

   Sparkasse KölnBonn or any other of its entities is not to use the capital or reserves of Sparkasse KölnBonn to pay any coupons on capital instruments, unless (a) there is a legal obligation to do so, or (b) where the payment of the relevant coupon will be covered by the current profits of Sparkasse KölnBonn. In the case of doubts as to the existence of a legal obligation or sufficient current profit for the purpose of this commitment, Sparkasse KölnBonn is to submit the proposed coupon payment to the Commission for approval;

2. (b)

   No entity of Sparkasse KölnBonn is to exercise a call option in respect of these hybrid capital instruments if Sparkasse KölnBonn’s total regulatory capital would be reduced as a result.

During the implementation of the restructuring plan, until 31 December 2014 at the latest, Sparkasse KölnBonn is to pay coupon on and avoid loss absorption by the subordinated capital only if it is obliged to do so, and provided it does not require the release of reserves and of the special items pursuant to §340 f and g of the Commercial Code.

Acquisition ban: Upon the Decision coming into effect, Sparkasse KölnBonn is not to acquire more than 20 % of the shares in other financial institutions during a period of 3 years. Other participation transactions that are not related to Sparkasse KölnBonn’s original customer business in its business model may still be carried out, provided they do not jeopardise the Sparkasse’s viability and have been approved by the European Commission. In addition, Sparkasse KölnBonn is to refrain from acquiring participations that are not necessary for its core business, or that entail excessive risks.

No reference to state support in advertising: Sparkasse KölnBonn is not to use the European Commission’s authorisation of the measures, which the European Commission has assessed as constituting State aid, or other competitive advantages resulting therefrom, for advertising purposes.

Sparkasse KölnBonn is to sell the following participations (referred to together as the business to be divested), in so far as they have not already been sold, by no later than the dates indicated and at the best possible prices. This should enable the essential, valuable elements of the current business to be retained until they are put up for sale.

In order to avoid undue distortions of competition, Sparkasse KölnBonn undertakes to sell, or procure the sale of the above-mentioned businesses to be divested as going concerns under the terms of sale approved by the Commission in accordance with the procedure described in paragraph 26. Sparkasse KölnBonn undertakes to enter into a final, binding purchase agreement for the sale of the business to be divested within the first divestiture period^f4. If Sparkasse KölnBonn has not entered into such an agreement by the end of the first divestiture period,

1. (a)

   the deadline will be extended by a further […] if Sparkasse KölnBonn can prove that […]. Sparkasse KölnBonn undertakes to enter into a final, binding purchase agreement […] within the extended divestiture period for the sale of the business to be divested;

2. (b)

   if Sparkasse KölnBonn has not entered into such an agreement by the end of the extended divestiture period, it is to grant the divestiture trustee an exclusive mandate to sell the business to be divested within the trustee divestiture period^f5. The procedure for the nomination of the divestiture trustee, and his duties are set out in Annex III.

The commitment to divest will be considered fulfilled if Sparkasse KölnBonn enters into a final, binding purchase agreement by the end of the period under paragraph 10 or of the extended period under paragraph 11 with a buyer that fulfils the conditions in paragraphs 25 and 26, and if the transfer of the business to be divested is effected no later than 6 months after the conclusion of the purchase agreement.

Sparkasse KölnBonn is to sell the following participations by no later than 31 March 2011 to the city of Cologne, a company connected with the city of Cologne or a third party:

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The individual transactions with the city of Cologne are to be carried out under normal market conditions. For this purpose, the current market value of the sales object at the time of transfer is to be determined by an independent expert. The monitoring trustee is to monitor the individual transactions.

In the context of the transaction it is also permitted to transfer the assets and business activities of a company, instead of the company in question, if this serves the intended business purpose.

An auditing company is to verify the valuation of the assets and the contractually agreed general business data on behalf of the purchaser.

Before the transaction takes place, the monitoring trustee is to be informed of its details.

In order to maintain the structural effect of the commitments, Sparkasse KölnBonn may not, for a period of […] after they become effective, acquire direct or indirect influence over the whole or part of the business to be divested, unless the Commission has previously found that the structure of the market has changed to such an extent that protecting the business to be divested from such influence is no longer necessary in order to render the restructuring measures compatible with the internal market.

In the future Sparkasse KölnBonn is to grant no more than [30-60] % of the financing to its subsidiaries that are to be divested. An exception is made for existing loans until the due date under the loan agreement.

The profits from the sale of Sparkasse KölnBonn’s participations are to be used entirely to fund the restructuring plan.

From the date on which the commitments become effective until transfer, Sparkasse KölnBonn is to preserve, in accordance with good business practice, the economic viability, marketability and competitiveness of the business to be divested and is to minimise as far as possible any risk that may reduce its competitive potential. Sparkasse KölnBonn undertakes, in particular

1. (a)

   not to carry out any activity that might have an adverse impact on the value, management or competitiveness of the business to be divested, or that might alter the nature and scope of its activity, its industrial or commercial strategy or its investment policy;

2. (b)

   to make available sufficient resources for the development of the business to be divested, on the basis of and by implementing the existing business plans;

3. (c)

   to take all reasonable steps, including appropriate incentive schemes (based on industry practice), to encourage all key personnel to remain with the business to be divested.

Sparkasse KölnBonn undertakes, from the date on which the commitments become effective until transfer, to keep the business to be divested separate from the businesses it is retaining and to ensure that the managers of the subsidiaries who are operating the business to be divested have no involvement in the management of any business retained and vice versa.

Until the transfer, Sparkasse KölnBonn is to assist the monitoring trustee in ensuring that the business to be divested is managed as a distinct and saleable entity.

Sparkasse KölnBonn undertakes, subject to the customary limitations, not to solicit the key personnel transferred with the business to be divested for a period of 12 months after closure, and will ensure that the affiliated undertakings do not solicit them either.

In order to enable potential purchasers to carry out a reasonable due diligence check of the business to be divested, Sparkasse KölnBonn undertakes, subject to the customary confidentiality assurances and depending on the stage of the divestiture process, to:

1. (a)

   provide potential purchasers with sufficient information on the business to be divested;

2. (b)

   give potential purchasers sufficient information on and reasonable access to the personnel.

In order to ensure the immediate restoration of effective competition,

1. (a)

   the purchaser must be independent of and unconnected to Sparkasse KölnBonn. This does not apply, however, to the sale of […], […] and the participations listed in paragraph 13 to the responsible municipalities, their affiliated companies, and members of the Sparkassen financial group;

2. (b)

   the purchaser must have the financial resources, proven expertise and incentive to maintain and develop the business to be divested as a viable and active competitive force in competition with Sparkasse KölnBonn and other competitors;

3. (c)

   in the light of the information available to the Commission, the purchaser must not give rise to prima facie competition concerns, nor to a risk that the fulfilment of the commitments will be delayed, and can, in particular, reasonably be expected to obtain all necessary approvals from the relevant regulatory authorities for the acquisition of the business to be divested.

As soon as Sparkasse KölnBonn reaches an agreement with a purchaser, it is to submit a fully documented and reasoned proposal, including a copy of the final agreement, to the Commission and the monitoring trustee. Sparkasse KölnBonn must be able to demonstrate to the Commission that the purchaser meets the relevant requirements and that the business to be divested is being sold in a manner consistent with the commitments. The Commission is to verify that the purchaser meets the relevant requirements and that the business to be divested is being sold in a manner consistent with the commitments.

Early partial repayment and partial conversion of the certificates of participation: The Federal Government and Sparkasse KölnBonn hereby commit to the following successive and integrated measures for improving Sparkasse KölnBonn’s core capital ratio:

1. (a)

   Zweckverband Sparkasse KölnBonn (Sparkasse KölnBonn special-purpose association) will purchase by 31 December 2011, to be effective as of 1 January 2011, a first tranche of EUR 150 million in certificates of participation of the Rheinische Sparkassen-Förderungsgesellschaft and convert them into an instrument recognised as regulatory core capital (tier 1 capital).

2. (b)

   By 31 December 2011 Sparkasse KölnBonn will repurchase a second tranche of EUR 150 million in certificates of participation of the Rheinische Sparkassen-Förderungsgesellschaft, provided that this is compatible with Sparkasse KölnBonn’s risk-bearing capacity and has been approved by the Federal Financial Supervisory Agency.

Germany undertakes that the conditions of the partial conversion and partial repurchase of the certificates of participation will be formulated in such a way that further State aid is ruled out.

In addition to the measures already carried out to reduce the total assets, Sparkasse KölnBonn undertakes to reduce other assets (large-scale lending activities, short-term lending, investments) by EUR [2,5-4] billion by the end of 2014. On the other hand, however, Sparkasse KölnBonn is to develop its core business activities (in particular, regional retail and corporate lending) while ensuring that the net total assets do not exceed EUR [25-30] billion at the end of 2014. In line with this, the Sparkasse KölnBonn’s risk weighted assets are not to exceed EUR [16-19] billion at the end of 2014.

The complete and correct implementation of all the conditions contained in this document is to be fully monitored on an ongoing basis and checked in detail by an adequately qualified and independent monitoring trustee. The appointment and duties of the monitoring trustee are laid down in Annex II.

…

Duly authorised for and on behalf of

[Indicate the name of the MS]