Minutes of the General Meeting of Shareholders held on 30 March 2005

Minutes of the General Meeting of Shareholders of Sligro Food Group N.V., held at 11:00 on Wednesday, 30 March 2005, at the company's offices in Veghel.

Present:
Messrs. H.J. Hielkema, G.J. Beijer, T.J.M. van Hedel, J.H. Menkveld and F.K. de Moor of the Supervisory Board, Messrs. A.J.L. Slippens, H.L. van Rozendaal and K.M. Slippens of the Executive Board and Mr. A.J.M. Voets, who was to be appointed to the Executive Board at the meeting, the company's auditors represented by Mr. Heeren, the company's civil-law notary Mr. Van der Zanden, representatives of the press, representatives of Stichting Prioriteit Sligro-Groep and Stichting Preferente Aandelen Sligro-Groep, the Executive Committee of Stichting Administratiekantoor Slippens, shareholders and other invited guests.

Pursuant to Article 42, paragraph 1, of the Articles of Association, the Supervisory Board appointed its president, Mr. Hielkema, as chairman of this General Meeting of Shareholders.

The agenda comprised the following items.

The chairman called the meeting to order and welcomed those present. He asked Mr. Dijkstra to act as secretary and minute clerk for this meeting.

The chairman announced that item 12 of the agenda had been withdrawn. This item had related to extension of the period for which the Executive Board was authorised to issue ordinary shares and restrict or exclude pre-emptive rights.

The secretary confirmed that the meeting had been convened in accordance with Article 39 of the Articles of Association. Advertisements announcing the meeting had been placed on 9 March 2005 in the Euronext Official List, the Financieele Dagblad and the Brabants Dagblad, as evidenced by copies which were available for inspection.

A total of 93 shareholders were present in person or represented by the holder of a written proxy. Since they represented 12,588,725 shares or 60.9% of the issued share capital, valid resolutions could be adopted. The quorum required for amendment of the Articles of Association was also present.

He also confirmed that no depositary receipts had been issued with the cooperation of the company.

The minutes of the General Meeting of Shareholders of 17 March 2004 were adopted and signed by the chairman and the secretary in accordance with Article 43, paragraph 1, of the Articles of Association. No comments or remarks on the minutes had been received during the three months that the minutes had been posted on the company's website (www.sligrofoodgroup.nl) for consultation by shareholders. The following comments were made on the minutes at the meeting.

Mr. Burger noted that his name had been spelled 'Burgers' on page 3 of the minutes. This should be 'Burger' (no 's').

Mr. Dekker of the Dutch Investors' Association (Vereniging van Effectenbezitters/VEB) asked why appointment of the auditors had not been included in the agenda. Mr. Van Rozendaal replied that there was no need to appoint or reappoint the auditors. The responsible partner of the firm of auditors had to be replaced every seven years, but there was no rota for appointing the auditing firm. Because no change was necessary at present, the agenda did not include (re)appointment of the auditors.

The minutes were then approved.

Mr. A. Slippens welcomed those present before discussing the report of the Executive Board on the 2004 financial year.

Mr. Van Rozendaal then discussed the figures presented in the annual report. Turnover in 2004 amounted to €1,447 million and net profit was 22.6% higher at €55 million. He went on to analyse the result into the relative contributions made by food service and food retail, before discussing the cash flow statement and the balance sheet as at year-end 2004.

Mr. Van Rozendaal concluded his remarks with a discussion of the effect of IFRS (International Financial Reporting Standards) on the profit and loss account and balance sheet. Under IFRS, the net profit would have been €59 million and shareholders' equity would have been €227 million.

Mr. Voets reviewed the developments in food retailing in the Netherlands and Sligro Food Group's activities in this area. The price war had made 2004 a difficult year for the entire sector and was affecting both the Em-Té and Prisma formats, but the repositioning of Golff which had become necessary had proved a success.

Mr. K.M. Slippens reviewed the Dutch food service market. Thanks to organic growth and the acquisition of Ven, Sligro Food Group's turnover in this segment was 11.7 % higher. A start had been made on integrating Ven in 2004 and the process would be completed in 2006.

Mr. A.J.L. Slippens discussed the outlook for 2005, citing as one of the main features the expectation that the market would continue to tighten, thus maintaining the pressure on margins in both food retail and food service. In these circumstances, it was still essential to control costs and achieve synergy gains, while maintaining quality.

The Milo format would be disposed of and the participating interest in AAN would be sold. Ven's fresh produce business would be transferred to the regular 'Fresh Partners'.

The chairman then invited questions from the floor.

Mr. Beijers (Orange Fund) complimented the Executive Board on the results. In reply to his question how satisfied Sligro Food Group was with the results on fresh produce, the Executive Board said that this area of the business was receiving its full attention. Fresh produce was an area in which Sligro Food Group could distinguish itself from the competition, which was important. That was why Sligro food group had entered into its alliance with the 'Fresh Partners', which had generated significant growth in fresh produce volumes.

Mr. Beijers also asked about the share of private label business and any plans to increase it further. Mr. A.J.L. Slippens replied that private label business accounted for about 15% and efforts were being made to grow this share.

Mr. Beijers then enquired whether there were any plans for large-scale investments in IT systems. He was told that, apart from the Ven/Em-Té integration exercise, there were no particular plans in this area other than ensuring that the IT systems were up-to-date at all times.

Lastly, Mr. Beijers asked about developments relating to Deli XL and was told that there was nothing to report.

Mr. Van Beuningen (Darlin) complimented the Executive Board on the results and said he was curious as to the background to the termination of the contract with the Ministry of Defence. He was told that, as the result of a new European tendering procedure, the supply contracts had been awarded on price to a competitor for the next two years. The Ministry of Defence had made it clear, however, that it had been very satisfied with the relationship with Sligro Food Group/Van Hoeckel.

Mr. Van Beuningen observed that, in the food retail sector, the supermarket format which did not use franchisees (Em-Té), scored better than the format using franchisees (such as Golff). He asked whether, in view of this difference, Sligro Food Group intended to grow Em-Té at a faster rate through acquisition. He was told that, although the number of Golff outlets had decreased in 2004 as a consequence of the price war, it was Sligro Food Group's firm intention in the longer term to reverse this trend. In many cases, outlets traded more profitably under independent operators.

Mr. Ballemans noted that the auditors' fee had more than doubled in 2004 compared with 2003 and asked why this was the case. Mr. Van Rozendaal said that the increase in the auditors' fee mainly reflected additional work relating to the acquisition of Ven and the increased regulation. The matter would be kept under review.

Mr. Rienks asked how long the name 'Ven' would continue to be used and whether it had any value. He was told that there were no plans to convert the Ven outlets to Sligro outlets. To derive the maximum from the name 'Ven', it would be added to Sligro.

Mr. Rienks also asked why Sligro had acquired an outlet on Texel, when the market it served was too small for profitable operation. He was told that Sligro took the view that Type 1 outlets of this kind could be run profitably, given efficient logistics and the number of visitors to the island in the summer. A presence on Texel was attractive to major chains.

Mr. Rienks asked why Sligro Food Group continued to buy up small supermarkets when the competition was only too glad to be rid of them. He was told that, although these outlets could be difficult for the wholesale organisation to operate profitably, independent operators were often able to do so because they had a different cost structure. In some cases, small outlets had prospects of growing into large supermarkets.

Mr. Rienks observed that many of the matters referred to in the annual report were not on the agenda of the meeting, such as J. Smit Vishandel B.V. and the catering and hospitality formats (Big Snack, Food Planet, Entrée and Plaza). He was told that, due to pressure of time, it was not possible to discuss every aspect of Sligro Food Group, but the Executive Board was of course willing to answer any questions. It might be a good idea to give a presentation next year dealing with the catering and hospitality formats in greater depth.

Mr. Dekker (VEB) complimented the Executive Board on the results and asked which direction Sligro Food Group intended to develop in: food service or food retail? The answer was that growth could be organic or by acquisition. Organic growth was necessary in both food retail and food service. Growth by acquisition depended largely on the action of others and was thus more difficult to predict.

Mr. Dekker then asked for an indication of the synergy gains generated by the acquisition of Ven and was told that these had been estimated at €8–10 million.

The response to his questions regarding borrowing capacity and the terms and conditions on which it was available, Mr. Dekker was referred to the financial ratios given in the annual report. It was pointed out that Sligro Food Group applied more rigorous criteria than those generally applied by the banks.

Returning to an earlier question concerning investment in IT, Mr. Dekker asked for details of the projected expenditure in the period 2005–2010. Were further substantial investments expected during that period? He was told that Sligro Food Group estimated the cost of continuously updating the IT systems at several million euros per year, but this would not give rise to a significant peak in expenditure.

a) Approval of the 2004 annual accounts

In response to Mr. Rienks' observation that 30x profit was paid to acquire Ven, Mr. Van Rozendaal pointed out that Mr. Rienks' calculation also included Ven's debts. The price paid for the shares was around 15x net profit.

Replying to further questions by Mr. Rienks, Mr. Van Rozendaal gave a brief explanation of the dollar loan with an equivalent value of €106 million. Sligro Food Group had secured two loans on attractive terms via private placements in the United States. While not common in the Netherlands, such transactions were by no means unique.

There being no further questions, the chairman declared the annual accounts approved.

b) Adoption of the proposed profit appropriation as reflected in the annual accounts

The proposed profit appropriation included in the annual report represented a dividend of €1.00 per share. The priority shareholder had proposed that the shareholders be given the option of receiving the dividend in cash or in shares, at an exchange ratio which was yet to be determined. Shareholders would have until close of trading on the Euronext stock exchange in Amsterdam on Wednesday, 13 April 2005, to make their choice known. After close of trading on 13 April, the number of shares giving entitlement to one new Sligro Food Group N.V. share would be calculated on the basis of the average closing price of the share over the period 11 April–13 April. The dividend in shares would be approximately equal to the cash dividend. The dividend would be payable on 27 April.

This proposal was approved by the meeting without comment.

c) Ratification of the actions of the Executive Board in respect of its management

The meeting approved without comment the proposal to ratify the actions of the Executive Board in respect of its management in 2004.

d) Ratification of the actions of the Supervisory Board in respect of its supervision

The meeting approved without comment the proposal to ratify the actions of the Supervisory Board in respect of its supervision in 2004.

Sligro Food Group largely complies with the provisions of the Netherlands Corporate Governance Code, with four exceptions.

The first exception concerns the term of office of members of the Executive Board. According to best-practice provision II.1.1, Executive Board members should be appointed for a term of four years, which Sligro Food Group considers inappropriate for smaller quoted companies such as itself.

The second exception, which is related to the first, concerns best-practice provision II.2.7. This provision sets a maximum limit on the remuneration received by Executive Board members in the event of involuntary termination of service. Sligro Food Group considers such restrictions undesirable and is currently reviewing its policy on remuneration of non-performing Executive Board members.

Best-practice provision III.7.3 of the code requires periodic disclosure of changes in the shareholdings of Supervisory Board members. since this provision is very widely drawn, Sligro Food Group will confine this duty of disclosure to securities issued by companies with which the group has a material relationship.

Best-practice provision IV.3.1 of the code concerns the provision of information to shareholders and other parties on the financial markets. Instead of the procedure outlined in the code, Sligro Food Group has opted for a different approach to communication with the financial markets. The presentations given by the group in this regard are published on the website.

Mr. Van Beuningen confirmed that departures from the code were permitted in principle and agreed with the exceptions proposed by Sligro Food Group and the explanations given.

Mr. Dekker (VEB) complimented the Executive Board on Sligro Food Group's corporate governance structure, and in particular the dismantling of the anti-takeover defences. However, there were a number of areas where he felt there was still room for improvement. He questioned whether the age limit of 67 set by the Articles of Association for members of the Supervisory Board was justifiable. He also asked for a more detailed definition of the term 'budgetary profit target' as used in the bonus scheme for members of the Executive Board.

After a brief discussion of these points, the corporate governance policy was put to the vote. Mr. Boersma (BNP Paribas) entered 1,100 votes against the motion, Mr. Russ entered 12,131 votes against and 501 abstentions on behalf of three foreign shareholders and Northern Trust Company entered 1,857 votes against. The other votes being in favour, the resolution was carried.

There has been no change in the profit-retention and dividend policy. Sligro Food Group aims to distribute around 40% of the after-tax profit, excluding extraordinary results. Dividends are payable in cash or shares, at the shareholder's option.

Following a brief explanation given by the chairman, the profit-retention and dividend policy was approved by the meeting.

Remuneration policy was discussed with reference to the notes given in Annex 2 to the agenda. Mr. Dekker noted that Sligro Food Group had a good and transparent remuneration scheme, in which bonuses were related to the 'budgetary profit target'.

The remuneration policy was then approved.

The Supervisory Board proposed to reappoint Messrs. H.J. Hielkema and T.J.M. van Hedel for their second and last term of office.

Mr. Dekker noted that the Netherlands Corporate Governance Code required at least one member of the Supervisory Board to be a financial expert (III.3.2) and asked which of the incumbents was a financial expert within the meaning of the code. He was informed that Mr. Hielkema qualified as such.

Both reappointments were then approved.

The next item on the agenda was the appointment of Mr. A.J.M. Voets to the Executive Board of Sligro Food Group N.V. When the chairman put the resolution to the vote, Mr. Boersma (BNP) entered 1,100 votes against. The other votes being in favour, the resolution was carried. The chairman congratulated Mr. Voets on his appointment.

The proposed amendment of the Articles of Association was necessary to reflect changes in three areas: a) the legislation on the two-tier management structure (structuurregeling), b) the Netherlands Corporate Governance Code and c) the abolition of registered shares. The background to the changes in these three areas was explained, with particular reference to the winding-up of Stichting Prioriteit Sligro Groep and Stichting Preferente Aandelen Sligro Groep.

With regard to this item on the agenda, Mr. Rienks stated that he had initially been in favour of dismantling anti-takeover measures, but his support was now qualified by the realisation that, although greater shareholder influence was a good thing – for small shareholders as well as large – it must not lead to a situation in which only the views of the strongest prevail.

Mr. Dekker said that, contrary to the best-practice provisions of the Netherlands Corporate Governance Code, Sligro Food Group had not included the profit-retention and dividend policy and the dividend proposal as separate items on the agenda. The chairman argued that Sligro Food Group had complied with the code on this point: the dividend proposal was covered by item 4b and the profit-retention and dividend policy by item 6.

Mr. Dekker also noted that, under the new Articles of Association, a legal entity or natural person could not act as proxy for more than five shareholders with voting rights. Although the number has been increased from one to five, Mr. Dekker considered this an unnecessary restriction and would prefer the limit to be removed. His proposal was not accepted by the meeting.

The proposal to amend the Articles of Association was then put to the vote and was carried unanimously. The chairman thanked the members of the Executive Committees of both Stichting Prioriteit Sligro Groep and Stichting Preferente Aandelen Sligro for their work over the years, in particular Mr. J.J.A. Slippens, whom he described, in his capacity as member of the Executive Committee of Stichting Prioriteit, as 'Tabaksblat before his time'.

The meeting approved the proposal, with 1,857 votes against being entered by Northern Trust Company.

This item was withdrawn. The powers currently vested expired on 19 March 2006. This item would be included again in the agenda for the 2006 General Meeting of Shareholders.

Mrs. Aghina returned to the issue of representation of shareholders by proxies. The VEB was a good channel through which small shareholders could make their voices heard at general meetings and for that reason she supported the greater freedom to appoint proxies.

In response to a point raised by Mr. Burger, it was announced that the social report had been posted on the website and that copies were available for the shareholders at the exit.

Mr. Swinkels enquired about the status of the legal proceedings relating to the ABIM acquisition. It was stated that the proceedings had been dragging on for years and there had been no particular progress to report. The proceedings were of minor significance.

There being no other business, the chairman thanked those present for their contributions and adjourned the meeting.

Chairman, H.J. Hielkema
Minute clerk, A.P. Dijkstra