UNITED STATESSECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 20-F(Mark One)

‘ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR(g) OF THESECURITIES EXCHANGE ACT OF 1934

ORÈ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended June 30, 2012

OR‘ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934For the transition period from to

OR‘ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934Commission file number 333-179839

D.E MASTER BLENDERS 1753 N.V.(Exact name of Registrant as specified in its charter)

Not Applicable(Translation of Registrant’s name into English)

The Netherlands(Jurisdiction of incorporation or organization)

Oosterdoksstraat 801011 DK Amsterdam

The Netherlands+31 20-558-1753

(Address of principal executive offices)Robin Jansen

Vice President Investor RelationsOosterdoksstraat 801011 DK Amsterdam

The Netherlands+31 20-558-1753

Investor-relations@DEMB.com

Onno van KlinkenGeneral Counsel and Corporate Secretary

Oosterdoksstraat 801011 DK Amsterdam

The Netherlands+ 31 20-558-1753

corporate.secretary@DEMB.com(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act.Not applicable

Securities registered or to be registered pursuant to Section 12(g) of the Act.Not applicable(Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.Title of each class Name of each exchange on which registered

Ordinary shares, par value €0.12 per share NYSE Euronext Amsterdam(Title of Class)

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annualreport: 594,859,274 common shares

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act ‘ Yes No ÈIf this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934. ‘ Yes No È

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filingrequirement for the past 90 days. È Yes No ‘

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data Filerequired to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorterperiod that the registrant was required to submit and post such files). ‘ Yes No ‘

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer or a non-accelerated filer. See definition of “accelerated filerand large accelerated filer” in Rule 12b-2 of the Exchange Act

‘ Large accelerated filer ‘ Accelerated filer È Non-accelerated filerIndicate by checkmark which basis of accounting the registrant has used to prepare the financial statements included in this filing‘ U.S. GAAP È International Financial Reporting Standards as issued by the International Accounting Standards Board ‘ OtherIf “other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to

follow. ‘ Item 17 ‘ Item 18If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange

Act). ‘ Yes No È

TABLE OF CONTENTS

Page

Item 1 Identity of Directors, Senior Management and Advisors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1Item 2 Offer Statistics and Expected Timetable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1Item 3 Key Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1Item 4 Information on the Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28Item 4A Unresolved Staff Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49Item 5 Operating and Financial Review and Prospects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49Item 6 Directors, Senior Management and Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72Item 7 Major Shareholders and Related Party Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92Item 8 Financial Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98Item 9 The Offer and Listing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101Item 10 Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102Item 11 Quantitative and Qualitative Disclosure about Market Risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121Item 12 Description of Securities other than Equity Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121Item 13 Defaults, Dividend Arrearages and Delinquencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121Item 14 Material Modifications to the Rights of Security Holders and Use of Proceeds . . . . . . . . . . . . . 121Item 15 Controls and Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123Item 16A Audit Committee Financial Expert . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124Item 16B Code of Ethics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124Item 16C Principal Accountant Fees and Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 124Item 16D Exemptions from the Listing Standards for Audit Committees . . . . . . . . . . . . . . . . . . . . . . . . . 125Item 16E Purchases of Equity Securities by the Issuer and Affiliated Purchasers . . . . . . . . . . . . . . . . . . . 125Item 16F Change in Registrant’s Certifying Accountant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125Item 16G Corporate Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125Item 16H Mine Safety Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126Item 17 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126Item 18 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-1Item 19 Exhibits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-9

Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-11

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PRESENTATION OF CERTAIN INFORMATION

D.E MASTER BLENDERS 1753 N.V. is referred to in this Annual Report on Form 20-F as “D.E MASTERBLENDERS” and D.E MASTER BLENDERS together with its member companies are together referred to asthe “D.E MASTER BLENDERS Group” or the “Group”. For such purposes, “member companies” means, inrelation to D.E MASTER BLENDERS 1753 N.V., those companies that are required to be consolidated inaccordance with International Financial Reporting Standards (“IFRS”) as issued by the International AccountingStandards Board (“IASB”) and in conformity with IFRS as adopted by the European Union. References to the“NYSE Euronext Amsterdam” are to NYSE Euronext in Amsterdam. References to the “SEC” are to theSecurities and Exchange Commission.

In this Annual Report on Form 20-F, references to “EUR”, “euro” and “€” are to the lawful currency of themember states of the European Monetary Union that have adopted the single currency in accordance with theTreaty establishing the European Community, as amended by the Treaty on European Union. References to “$”,“USD”, “US$” and “US dollars” are to the lawful currency of the United States of America, references to“GBP”, “pound sterling” and the “UK pound” are to the lawful currency of the United Kingdom, references to“AUD”, “A$” and “Australian dollars” are to the lawful currency of Australia and references to “BRL”, “R$”and “Brazilian real” are to the lawful currency of the Federative Republic of Brazil.

Unless the context otherwise requires, all references herein to “we”, “our”, “us”, “the Company” and referto D.E MASTER BLENDERS (i) after the conversion of D.E MASTER BLENDERS B.V. from a private limitedliability company (besloten vennootschap met beperkte aansprakelijkheid) to a public company with limitedliability (naamloze vennootschap) and following the separation, and (ii) prior to the separation of D.E MASTERBLENDERS on June 28, 2012 from the Sara Lee Corporation, they refer to Sara Lee Corporation’s internationalcoffee and tea businesses. All references herein to “Hillshire Brands Company”, “Hillshire”, “Sara LeeCorporation” and “Sara Lee” refer to Hillshire Brands Company, which was formerly known as Sara LeeCorporation. All references herein to the distribution refer to the distribution to the shareholders of Hillshire ofall of the shares of common stock of DE US, Inc. All references herein to the merger refer to the merger of awholly owned subsidiary of D.E MASTER BLENDERS with and into DE US, Inc. pursuant to which eachoutstanding share of DE US, Inc. common stock was exchanged for one ordinary share of D.E MASTERBLENDERS and DE US, Inc. became a subsidiary of D.E MASTER BLENDERS. All references herein to thespin-off or separation refer to the merger, distribution and other transactions contemplated thereby, collectively.

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FORWARD LOOKING STATEMENTS

This Annual Report includes forward-looking statements. All statements other than statements of historical factincluded in this Annual Report regarding our business, financial condition, results of operations and certain of ourplans, objectives, assumptions, projections, expectations or beliefs with respect to these items and statements regardingother future events or prospects, are forward-looking statements. These statements include, without limitation, thoseconcerning: the expected benefits of the separation from Sara Lee Corporation; our access to credit markets; and thefunding of pension plans. These statements may be preceded by terms such as “expects,” “anticipates,” “projects” or“believes.” In addition, this Annual Report includes forward-looking statements relating to our potential exposure tovarious types of market risks, such as commodity price risks, foreign exchange rate risks, interest rate risks and otherrisks related to financial assets and liabilities. We have based these forward-looking statements on our management’scurrent view with respect to future events and financial performance. These forward-looking statements are based oncurrently available competitive, financial and economic data, as well as management’s views and assumptionsregarding future events, and are inherently uncertain. Although we believe that the estimates reflected in the forward-looking statements are reasonable, such estimates may prove to be incorrect. By their nature, forward-lookingstatements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in thefuture. There are a number of factors that could cause actual results and developments to differ materially from thoseexpressed or implied by these forward-looking statements. These factors include, among other things, the Company’sability to transition successfully to a stand-alone operation, ongoing trends in the marketplace that affect the price anddemand for the Company’s products, the cost and availability of raw materials, the outcome of the Company’s internalinvestigation relating to its operations in Brazil and the impact of the restatement of the historical financial statementsas well as those listed in the section entitled “Risk Factors” in Item 3D.

We urge you to read the sections of this Annual Report entitled “Risk Factors,” “Operating and FinancialReview and Prospects,” “Industry Overview” and “Business Overview” for a discussion of the factors that couldaffect our future performance and the industry in which we operate. Additionally, new risk factors can emergefrom time to time, and it is not possible for us to predict all such risk factors. Given these risks and uncertainties,you should not place undue reliance on forward-looking statements as a prediction of actual results.

All forward-looking statements included in this Annual Report are based on information available to us on thedate of this Annual Report. We undertake no obligation to update publicly or revise any forward-looking statement,whether as a result of new information, future events or otherwise, except as may be required by applicable law. Allsubsequent written and oral forward-looking statements attributable to us or persons acting on our behalf areexpressly qualified in their entirety by the cautionary statements contained throughout this Annual Report.

MARKET, ECONOMIC AND INDUSTRY DATA

In this Annual Report, we make certain statements regarding our competitive and market position. Webelieve these statements to be true based on market data, industry statistics and publicly available information.Information regarding markets, market size, market share, market position, growth rates and other industry datapertaining to our business contained in this Annual Report consists of estimates based on data and reportscompiled by professional organizations and analysts, on data from other external sources, and on our knowledgeof our sales and markets. The information in this Annual Report that has been sourced from independent sourceshas been accurately reproduced and, as far as we are aware and able to ascertain from the information publishedby that independent source, no facts have been omitted that would render the reproduced information inaccurateor misleading. We have not independently verified these data or determined the reasonableness of theassumptions used by their compilers, nor have data from independent sources been audited in any manner. Inmany cases, including with respect to information regarding our competitive position in the Out of Home market,there is no readily available external information (whether from trade associations, government bodies or otherorganizations) to validate market-related analyses and estimates, requiring us to rely on internally developedestimates, which have not been verified by any independent sources. All of the assumptions, estimates andexpectations underlying our statements have been based on careful analysis and are our reasonable beliefs.

iii

PART I

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS

Not applicable

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE

Not applicable

ITEM 3. KEY INFORMATION

3A Selected financial data

A summary of historical financial data as of June 30, 2012, July 2, 2011 and July 3, 2010 and for the yearsthen ended have been derived from our audited financial statements included elsewhere herein. The selectedfinancial data as of June 27, 2009 and for the year then ended have been derived from our historical financialstatements after adjusting the financial statements for the impact of the restatement impacts as discussed below.Our financial statements have been prepared in accordance with IFRS as adopted by the International AccountingStandards Board and adopted by the European Union.

Our financial statements for the periods prior to June 28, 2012 represent combined financial statements, asthe Sara Lee international coffee and tea business was not held by a single parent company prior to theseparation. The combined financial statements were prepared on a “carve-out” basis for purposes of presentingour financial position, results of our operations and cash flows. Prior to June 28, 2012, the Group did not operateas a stand-alone entity and accordingly the selected financial data presented herein are not necessarily indicativeof our future performance and do not reflect what our financial performance would have been had we operated asan independent publicly traded company during the periods presented.

In connection with the Groups’ first year-end financial closing process as an independent company, theGroup identified accounting irregularities and certain other errors related to its previously reported historicalfinancial carve-out financial statements for fiscal years 2009 through 2011. Outside legal counsel andindependent forensic accountants conducted a comprehensive investigation into the irregularities, confirming thatthe irregularities in Brazil began prior to 2009 and continued until identified in July 2012. The historical financialstatements have been restated to include the effects of the accounting irregularities and certain other errors.

You should read the selected financial data in conjunction with our historical financial statements andrelated notes and “Operating and Financial Review and Prospects” included in Item 5. Our historical results donot necessarily indicate our expected results for any future periods.

1

Fiscal Year Ended

June 30, 2012July 2, 2011

RestatedJuly 3, 2010(1)

RestatedJune 27, 2009

Restated

(amounts in millions of euro, except percentages and per shareamounts)

Income Statement DataSales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,795.0 2,593.3 2,313.4 2,218.3Cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,787.1 1,611.6 1,347.7 1,333.1

Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,007.9 981.7 965.7 885.2Selling, general and administrative expenses . . . . . . . . . . . 898.2 656.4 623.8 554.3

Operating profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109.7 325.3 341.9 330.9Finance income, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132.2 91.8 55.3 128.1Finance costs, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.4 (45.4) 14.7 (12.1)Share of profit from associates . . . . . . . . . . . . . . . . . . . . . . 0.2 2.2 2.7 3.4

Profit before income taxes . . . . . . . . . . . . . . . . . . . . . . . . . 259.5 373.9 414.6 450.3Income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127.3 110.7 174.9 127.3

Profit for the period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132.2 263.2 239.7 323.0

Earnings per Ordinary Share-Basic and Diluted(2) . . . . . . . 0.22 0.44 0.40 0.54

Weighted Average Shares Outstanding-Basic and Diluted(in millions of shares) . . . . . . . . . . . . . . . . . . . . . . . . . . . 595 595 595 595

Balance Sheet DataCash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . 220.3 1,342.6 663.8 506.4Trade receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 282.3 250.0 228.7 226.8Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 404.9 437.5 308.8 275.7Trade payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 282.1 264.7 198.3 185.5Property, plant and equipment . . . . . . . . . . . . . . . . . . . . . . 377.4 369.9 365.6 372.6Total borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 557.4 363.1 330.8 308.0Total parent’s net investment(3) . . . . . . . . . . . . . . . . . . . . . . — 3,271.1 2,518.9 2,808.1Total shareholders’ equity(3) . . . . . . . . . . . . . . . . . . . . . . . . 317.6 — — —

Cash Flow DataCash generated from (used in) operating activities(4) . . . . . 102.5 281.7 364.8 194.0Cash generated from (used in) investing activities(5) . . . . . 456.7 70.8 353.8 (70.6)Cash generated from (used in) financing activities(5) . . . . . (1,685.9) 340.2 (564.1) (346.3)

Other Financial DataSales growth . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.8% 12.1% 4.3% n/aLike for like sales growth(6) . . . . . . . . . . . . . . . . . . . . . . . . . 7.5% 9.2% 0.5% n/aEBIT(7) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109.9 327.5 344.6 334.3EBIT margin(8) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.9% 12.6% 14.9% 15.1%Adjusted EBIT(7) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 321.8 357.2 366.1 339.6Adjusted EBIT margin(8) . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.5% 13.8% 15.8% 15.3%Working capital(9) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63.6 2,200.6 2,361.4 2,577.7Operating working capital(9) . . . . . . . . . . . . . . . . . . . . . . . . 405.1 422.8 339.2 317.0Operating working capital as a percentage of sales(9) . . . . . 14.5% 16.3% 14.7% 14.3%Free cash flow(10) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2 204.2 299.1 76.5Net cash(11) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 979.5 333.0 198.4Net debt(11) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 337.1 — — —Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97.3 77.5 65.7 117.5

2

(1) Our fiscal year ends on the Saturday closest to June 30. Fiscal years 2012, 2011 and 2009 were 52-week and2010 was a 53-week year.

(2) Earnings per share is computed by dividing profit for the period by the weighted average number ofcommon shares outstanding for the period. The earnings per share for the periods prior to the separationwere computed as if the shares issued at separation, which equal the shares outstanding at June 30, 2012,were outstanding for all periods presented.

(3) As the entities within Sara Lee’s international coffee and tea operations were not held by a single legalentity prior to the separation we presented parent’s net investment instead of shareholders’ equity. Upon theinternational coffee and tea operations becoming owned by the Company, the parent’s net investment wasconverted into shareholders’ equity.

(4) For the periods prior to separation, we have assumed all taxes were settled by Hillshire, and as a result thereare no cash taxes reflected in our operating cash flows. As a consequence, our future operating cash flowswill be reduced by tax payments that are currently reflected as distributions to Hillshire in financingactivities in the statement of cash flow.

(5) For the periods prior to separation, our investing cash flows reflect cash inflows of €685.2 million,€156.9 million and €402.6 million in the fiscal years 2012, 2011 and 2010, respectively, and cash outflowsof €30.3 million in fiscal year 2009 related to loans provided by us to Hillshire and the associated interestincome. These loans were settled in connection with the spin-off.

For the periods prior to separation, our financing cash flows reflect distributions to Hillshire of€566.8 million in fiscal 2010 and contributions from Hillshire of €80.4 million in fiscal 2012 and €342.6million in fiscal 2011 and €335.9 million to Hillshire in 2009.

(6) We define like for like sales as sales calculated at a constant exchange rate and adjusted to eliminate the53rd week and acquisitions during the period. We have included like for like sales to provide the investor amore clear understanding of our sales growth on a comparable basis. Like for like sales is not a measure inaccordance with IFRS and accordingly should not be considered as an alternative to sales. The followingtable provides reconciliation from sales to like for like sales:

Fiscal Year Ended

June 30, 2012July 2, 2011

RestatedJuly 3, 2010

RestatedJune 27, 2009

Restated

(amounts in millions of euro, except percentages)

Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,795.0 2,593.3 2,313.4 2,218.3Adjustments

Foreign Exchange(a) . . . . . . . . . . . . 2.7 (16.0) 73.9 117.753rd week . . . . . . . . . . . . . . . . . . . n/a n/a (34.6) n/aCafé Moka acquisition . . . . . . . . . . (19.7) (24.6) (36.1) (31.7)Café Damasco acquisition . . . . . . . (45.6) (24.0) n/a n/aCoffee Company acquisition . . . . . (5.7) n/a n/a n/aTea Forté acquisition . . . . . . . . . . . (5.2) n/a n/a n/aHouse of Coffee acquisition . . . . . . (2.3) n/a n/a n/aExpresso.Coffee acquisition . . . . . (0.8) n/a n/a n/a

Like for like sales . . . . . . . . . . . . . . . . . . . . . 2,718.4 2,528.7 2,316.6 2,304.3

Like for like sales growth . . . . . . . . . . . . . . . 7.5% 9.2% 0.5% n/a

(a) The foreign exchange adjustments are calculated at the budgeted exchange rate for fiscal 2012. Theserates may differ from the average exchange rate for the period. The currencies with the most significantimpact are the Australian dollar and the Brazilian Real. The budgeted exchange rates were 1.36 and1.64 for the Australian Dollar and 2.38 and 2.74 for the Brazilian Real for fiscal 2012 and 2011,respectively.

3

(7) EBIT is defined as profit for the period before finance income, finance costs and income taxes. We defineadjusted EBIT as EBIT before share of profit from associates and adjusted to exclude items managementbelieves are unrelated to its underlying business and that are excluded from our segment profitability,including restructuring charges, impairment charges, costs associated with businesses no longer owned byus and others. We have included adjusted EBIT as it is a key performance metric used by managementacross our business. In addition, we believe these are useful measures for investors in understanding theperformance of our underlying operations. These profit measures are not financial measures calculated inaccordance with IFRS and may not be comparable to similar measures presented by other companies.Accordingly, they should not be considered as an alternative to operating profit or profit for the period. Thefollowing tables provide reconciliation from profit for the period to these non-IFRS measures:

Fiscal Year Ended

June 30, 2012July 2, 2011

RestatedJuly 3, 2010

RestatedJune 27, 2009

Restated

(amounts in millions of euro)

Profit for the period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132.2 263.2 239.7 323.0Finance income, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . (132.2) (91.8) (55.3) (128.1)Finance costs, net(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . (17.4) 45.4 (14.7) 12.1Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127.3 110.7 174.9 127.3

EBIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109.9 327.5 344.6 334.3Share of profit from associates . . . . . . . . . . . . . . . . . . . (0.2) (2.2) (2.7) (3.4)Adjustments

Restructuring charges . . . . . . . . . . . . . . . . . . . . . . 57.7 25.2 5.4 36.2Restructuring related . . . . . . . . . . . . . . . . . . . . . . . 63.0 7.8 9.1 6.8Termination of prior Senseo agreement . . . . . . . . 55.3 — — —Curtailment and past service costs . . . . . . . . . . . . — (13.1) — (23.8)Impairment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21.3 5.6 — —Gain on sale of assets . . . . . . . . . . . . . . . . . . . . . . . — — — (17.2)Branded apparel costs(b) . . . . . . . . . . . . . . . . . . . . . 7.9 3.5 7.9 6.7Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.9 2.9 1.8 —

Total adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . 212.1 31.9 24.2 8.7

Adjusted EBIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 321.8 357.2 366.1 339.6

(a) The foreign exchange adjustments are calculated at the budgeted exchange rate for fiscal 2012. Theserates may differ from the average exchange rate for the period. The currencies with the most significantimpact are the Australian dollar and the Brazilian Real. The budgeted exchange rates were 1.36 and1.64 for the Australian Dollar and 2.38 and 2.74 for the Brazilian Real for fiscal 2012 and 2011,respectively.

(b) We are legally responsible for and managed certain liabilities associated with the branded apparelbusiness Sara Lee sold prior to fiscal 2009. The liabilities, which include pensions, medical claims andenvironmental liabilities are reflected in our financial statements. We exclude the impact of these itemsin assessing our profitability as they are unrelated to our ongoing business.

(8) EBIT margin and adjusted EBIT margin represent EBIT and adjusted EBIT as defined above divided bysales.

(9) Working capital is defined as current assets less current liabilities. We define operating working capital asinventory and trade receivables less trade payables. We have included operating working capital as thecomponents of this measure are controlled by management and we use this measure to set managementtargets.

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The components of operating working capital are derived from our financial statements; however, this is nota measure calculated in accordance with IFRS and may not be comparable to similar measures presented byother companies. Accordingly, operating working capital should not be considered as an alternative tooperating cash flow.

(10) We define free cash flow as cash flows from operations less capital expenditures. We have included freecash flow as we believe it is a useful measure for investors. Free cash flow for the fiscal years 2011, 2010and 2009 is derived from our audited financial statements; however, this is not a measure calculated inaccordance with IFRS and may not be comparable to similar measures presented by other companies.Accordingly, free cash flow should not be considered as an alternative to operating cash flow. The followingprovides reconciliation from operating cash flow to this non-IFRS measure:

Fiscal Year Ended

June 30, 2012July 2, 2011

RestatedJuly 3, 2010

RestatedJune 27, 2009

Restated

(amounts in millions of euro, except percentages)

Operating Cash Flow . . . . . . . . . . . . . . . . . . 102.5 281.7 364.8 194.0Less: capital expenditures . . . . . . . . . . . (97.3) (77.5) (65.7) (117.5)

Free Cash Flow . . . . . . . . . . . . . . . . . . . . . . 5.2 204.2 299.1 76.5

(11) Net cash is defined as total cash and cash equivalents minus total borrowings (the sum of current borrowingsand non-current borrowings). Net debt is defined as total borrowings less cash and cash equivalents. For theperiods prior to separation we had net cash. Since separation we have net debt as a consequence of varioustransactions with Hillshire in connection with the separation, our borrowings increased and our cash andcash equivalents decreased. We have included net cash/debt as we believe it is a useful measure forinvestors.

Exchange Rate

We present our financial statements in euro. We make no representation that any euro or U.S. dollar amountcould have been, or could be, converted into U.S. dollars or euro, as the case may be, at the rates stated below orat all.

The following table sets forth information concerning exchange rates between the euro and the U.S. dollarfor the periods indicated.

Low High

(U.S.$ per €1.00)

Month ended:January 31, 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2682 1.3192February 29, 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3087 1.3463March 31, 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3025 1.3336April 30, 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3064 1.3337May 31, 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2364 1.3226June 30, 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2420 1.2703

Average forPeriod(1)

Year ended on the Saturday closest to June 30,:2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.31432008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.48372009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.36462010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.38642011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.37482012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3385

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Source: Federal Reserve (https://www.federalreserve.gov)Note:

(1) Annual averages are calculated from month-end rates.

On June 29, 2012, the noon buying rate in The City of New York for cable transfers of euro as certified forcustoms purposes by the Federal Reserve was €1.00 to U.S. $1.2668.

3B Capitalization and indebtedness

Not applicable

3C Reasons for the offer and use of proceeds

Not applicable

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3D Risk factors

Risks Related to our Business

The following discusses some of the key risk factors that could affect D.E MASTER BLENDERS’ businessand operations, as well as other risk factors that are particularly relevant to us in the current period of significanteconomic and market disruption. Additional risks to which we are subject include, but are not limited to, thefactors mentioned under “Forward-Looking Statements” above and the risks of our businesses describedelsewhere in this Annual Report. Other factors besides those discussed below or elsewhere in this Annual Reportalso could adversely affect our business and operations, and the following risk factors should not be considered acomplete list of potential risks that may affect D.E MASTER BLENDERS and the Group.

Increases in the cost of green coffee, tea or other commodities could reduce our gross margin and profit.

Our primary raw material is green coffee, an agricultural commodity. Green coffee is subject to volatileprice fluctuations. Speculation in the commodities markets, weather, seasonal fluctuations, real or perceivedshortages, pest or other crop damage, land usage, the political climate in the producing nations, competitivepressures, labor actions, currency fluctuations, armed conflict and government actions, including treaties andtrade controls by or between coffee producing nations, can affect the price of green coffee. Certain types ofpremium or sustainable coffees sell at higher prices than other green coffees due, among other things, to theinability of producers to increase supply in the short run to meet rising demand. As a result of the continuedincrease in demand for premium coffees, the price spread between premium coffee and non-premium coffee islikely to widen. We experienced significant increases in the price of green coffee in fiscal 2012. Additionally,although less material to our operations than green coffee, other commodities including tea leaves, packagingmaterials, other coffee drink inputs and energy, are important to our operations.

Green coffee and other commodity price increases impact our business by increasing the costs of rawmaterials used to make our products and the costs to manufacture, package and ship our products. Decreases incommodity prices impact our business by creating pressure to decrease our sales prices. We use commodityfinancial derivative instruments and forward purchase contracts to hedge some of our commodity price exposure,consistent with our overall risk management program. Over time, if commodity costs increase, our operatingcosts will increase despite our commodity hedging program. The time period of the forward purchase contractsdo not necessarily match the time period of the agreements we enter into with customers to sell our products, soour hedging strategies may not effectively reduce our exposure to commodity price increases. If we are not ableto increase our product sales prices to sufficiently offset increased raw material costs, as a result of consumersensitivity to pricing or otherwise, or if unit volume sales are significantly reduced due to price increases, it couldhave an adverse effect on our profitability.

Current economic conditions may negatively impact demand for our products, which could adverselyimpact our sales and operating profit.

Economic and market conditions have deteriorated significantly in many countries in which we operate, andthese conditions have deteriorated further as a result of the current crisis in Europe, which has created uncertaintywith respect to the ability of certain countries in the European Union, which we refer to as the EU, to continue toservice their sovereign debt obligations. Since our sales are concentrated in Western Europe, these conditionshave had, and are likely to continue to have, a negative impact on our business and on global economic activityand financial markets. If these conditions persist, our business, results of operations and financial position couldbe materially adversely affected.

We believe that economic uncertainty may create a shift in consumer preference toward private labelproducts. This may result in increased pressure to reduce prices of our products and/or limit our ability toincrease or maintain prices. Purchases of discretionary items by consumers, including some of our products,could decline during times of economic uncertainty. In addition, at the same time that we have been experiencing

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pressure from customers and consumers to reduce our prices, we have seen sharp increases in our operating costsas a result of changing commodity prices. If these unfavorable economic conditions continue, our sales andprofitability could be adversely affected.

Our pension costs could substantially increase as a result of volatility in the equity markets or interest rates.

The difference between plan obligations and assets, or the funded status of the plans, is a significant factorin determining the net periodic benefit costs of our pension plans. Changes in interest rates and the market valueof plan assets can impact the funded status of these plans and cause volatility in the net periodic benefit cost.Cash funding requirements are set by different rules but are also subject to volatility due to changes in interestrates and the market value of plan assets. The exact amount of cash contributions made to pension plans in anyyear is dependent upon a number of factors, including minimum funding requirements in the jurisdictions inwhich we operate, the tax deductibility of amounts funded and arrangements made with the trustees of certainpension plans. In some jurisdictions cash funding requirements are partly the result of determinations by separateboards which act independently of the Company. Our Dutch pension plan currently operates under a recoveryplan as required by the Dutch Central Bank when a pension fund has a coverage ratio below its required solvencylevel. For more information on the recovery plan, see “Management and Employees—Pension Schemes—Pension plans in the Netherlands” in Item 6. A significant increase in our pension funding requirements couldhave a negative impact on our results of operations or cash flow.

Our profitability may suffer as a result of competition in our markets.

The coffee and tea industries are intensely competitive. To maintain and increase our market positions, wemay need to increase expenditures on media, advertising, promotions and trade spend, and introduce newproducts and line extensions, which may require new production methods and new machinery. Due to inherentrisks in the marketplace associated with advertising and new product introductions, including uncertainties abouttrade and consumer acceptance, increased expenditures may not prove successful in maintaining or increasingour market share and could result in lower sales and profits.

Our consumer products also are subject to significant price competition. From time to time, we may need toreduce the prices for some of our products to respond to competitive and customer pressures and to maintainmarket share. Additionally, our retail customers may reduce the prices of our products in order to increaseconsumer traffic into their stores or may not increase prices to consumers as costs to produce our productsincrease. Such pressures may restrict our ability to increase prices in response to raw material and other costincreases. Any reduction in prices as a result of competitive pressures, or any failure to increase prices when rawmaterial costs increase, would harm profit margins and, if our sales volumes fail to grow sufficiently to offset anyreduction in margins, our results of operations will suffer. This occurred in fiscal 2011 and the first half of fiscal2012 when the price of green coffee increased significantly and we were unable to increase our prices in certainmarkets quickly enough to compensate for the increased cost of green coffee. Additionally, the delay between thetime commodity costs increase and the time we are able to increase our prices entails the risk that, before suchprice increases are passed on to our customers, the commodity prices may fall again, in which case we would beunlikely to recover losses caused by such temporary increases in commodity costs.

Changes in our relationships with our major customers, or in the trade terms required by such customers,may reduce sales and profits.

Because of the competitive environment, many of our retail customers have increasingly sought to improvetheir profitability through pricing concessions and increased promotional programs, more favorable trade termsand increased emphasis on private label products. This trend has become more pronounced with the increasedpurchasing power of buying groups and the rise of hard discounters in Europe. Our three largest customers inWestern Europe represented an aggregate of approximately 16% of our total sales in fiscal 2012. As thesecustomers gain leverage through consolidation, it has become more difficult to pass on increases in commodity

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prices to these customers. For example, in France, we have occasionally been forced to stop trading for limitedperiods with certain retail customers because of our disagreements on price. Additionally, our Out of Homecustomers are increasingly focused on price and we could lose contracts with those customers if our competitorsoffer lower prices. To the extent we provide concessions or trade terms that are favorable to our retail and Out ofHome customers, our margins will be reduced. Further, if we are unable to continue to offer terms that areacceptable to our customers, or our customers determine that they need less inventory, they could reducepurchases of our products or may increase purchases from our competitors, which would harm our sales andprofitability.

Sales of certain of our branded products are significant to our financial performance. Declining sales ofthese products would adversely affect our results of operations.

A significant percentage of our total revenue has been attributable to sales of our Douwe Egberts and Pilãobranded products and our Senseo single-serve pads. Sales of Douwe Egberts products (excluding productsco-branded Douwe Egberts), Senseo products (and related accessories) and Pilão products represented 23%, 16%and 10%, respectively, of our total sales in 2012. Our financial performance may be significantly affected bychanges in consumer perceptions of these brands. We experienced declining sales volumes of the Senseo coffeepads in fiscal 2012 and may be unable to compensate for the loss of these sales volumes through our plannedinnovations. Additionally, the Senseo single-cup brewing system is an “open” system, which allows competitorsto produce single-serve pads that compete with our Senseo single-serve pads. If we cannot convince customersand/or consumers that our Senseo coffee pads are superior to the single-serve pads produced by our competitorsfor the Senseo system, we may lose customers and/or consumers to our competitors. Any significant decline inthe sales volumes of our Senseo single-serve pads, and any significant decline in the sales of Douwe Egberts orPilão, would materially adversely affect our results of operations.

We may not achieve our product development goals, which could adversely impact our sales, operatingprofit and the price of our ordinary shares.

We have announced that we intend to renew our product line within the next 24 months and to launch a newSenseo machine annually. Our ability to achieve these goals is, and must necessarily be, based on a variety ofassumptions. We may not be able to achieve these goals, or to achieve them within our announced timeframe, insome cases for reasons beyond our control. Our failure to achieve these or any other product development goalscould adversely impact our sales, operating profit and the price of our ordinary shares.

We are reliant on certain key manufacturers for the production of our brewing machines and certainpackaging materials.

A significant portion of the Cafitesse liquid roast brewing machines for the Out of Home market is suppliedby one manufacturer. The Senseo single-cup brewing machines marketed under our prior development agreementwith Philips are, and the brewing machines using the Senseo trademark that are manufactured under the terms ofour existing agreement or any future development agreements with Philips are anticipated to be, manufactured byPhilips. We rely on these manufacturers to produce high-quality brewing machines in adequate quantities to meetcustomer demands. Any decline in quality, disruption in production or inability of the manufacturers to producethe machines in sufficient quantities, whether as a result of a natural disaster or other causes, could materiallyadversely affect our sales of liquid roast coffee and Senseo single-serve coffee pads. Since sales of liquid roastcoffee and Senseo single-serve pads are material to our operating results, such a disruption could result in amaterial adverse effect on our business, results of operations and financial position. In addition, certain of ourpackaging materials are sourced from a limited number of suppliers. If those suppliers discontinue or suspendoperations because of bankruptcy or other financial difficulties we may not be able to identify alternate sourcesin a timely fashion which would likely result in increased expenses and operational delays.

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Certain of our products are sourced from single manufacturing sites.

We have consolidated our production capacity for certain of our product lines into single manufacturingsites. We could experience an interruption in or a loss of operations at these or any of our manufacturing sitesresulting in a reduction or elimination of the availability of some of our products. For example, ourmanufacturing facility in Nava Nakorn, Thailand was damaged by flooding in October 2011. This facility wasfully operational at the start of fiscal 2013. If upon an interruption of a loss of operations we are not able toobtain alternate production capability in a timely manner, we could experience a material adverse effect on ourbusiness, results of operations and financial position.

Our efforts to secure an adequate supply of quality or sustainable coffees may be unsuccessful.

We depend on the availability of an adequate supply of green coffee beans at the required quality levels orwith the required sustainability certifications from our coffee brokers, exporters, cooperatives and growers. If anyof our relationships with coffee brokers, exporters, cooperatives or growers deteriorate, we may be unable toprocure a sufficient quantity of coffee beans at prices acceptable to us. In the case of a shortage of supply orunacceptable quality levels or prices, we may not be able to fulfill the demand of our existing customers orsupply new customers with quality product at acceptable prices. A raw material shortage could force us to usealternative coffee beans or discontinue certain blends, could impair our ability to expand our business and couldadversely affect our results of operations.

Maintaining a steady supply of green coffee is essential to keep inventory levels low and secure sufficientstock to meet customer needs. To help ensure future supplies, we purchase coffee on forward contracts fordelivery in the future. Non-performance by suppliers could expose us to credit and supply risk. Additionally,entering into such future commitments exposes us to purchase price risk. Because we are not always able to passprice changes through to our customers due to competitive pressures and we are not always able to adequatelyhedge against changes in commodity prices, unpredictable price changes can have an immediate effect onoperating results that cannot be corrected in the short run.

Additionally, we expect to purchase certified sustainable coffee representing 20% of our annual coffeevolume by 2015, which would significantly increase our sustainable green coffee purchases. Certain of ourcompetitors have announced similar plans to purchase a significant amount of sustainable coffee. Because thesupply of coffee certifiable as sustainable is limited, the cost of acquiring such coffee may increase significantly,which would have an adverse effect on our results of operations. If we are unable to achieve our planned level ofsustainable coffee purchases, that could negatively impact consumer perception of our brands, which would havean adverse effect on our business.

If we are unable to improve our inventory management and forecasting systems to make our supply chainmore efficient, our business, results of operations and financial position may be adversely affected.

We are implementing improvements to our inventory management systems in order to provide betterforecasts and to enhance the efficiency of our supply chain. Improved forecasts will assist our ability to meet ourinternal targets for operating working capital. Accurate forecasts of demand for our coffee and tea products arenecessary to avoid losing potential sales of popular products or producing excess inventory of products that wewould be unable to sell without a price discount. We are also working to improve the alignment between ourforecasts of demand for coffee and tea volume and our forecasts of future sales prices for our products, whichwould also improve our ability to achieve our internal targets for sales growth and adjusted EBIT margin. If wedo not successfully implement our plans to improve our inventory management and forecasting systems, ourbusiness, results of operations and financial position may be adversely affected.

Our internal control over financial reporting may not be effective

In connection with our first year-end financial closing process as a separate company, our managementidentified accounting irregularities and certain other errors related to its previously reported historical financial

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statements. The errors caused by accounting irregularities involved our Brazilian operations and required us torecord provisions, including additional tax provisions, and restate our historical financial statements. Theseaccounting irregularities included the overstatement of accounts receivable due to the failure to write offuncollectible customer discounts, improper recognition of sales revenues prior to shipments to customers, theunderstatement of provisions for various litigation issues, unsupported expense reversals and postponements,moving inventory out of warehouses that were about to be verified by internal and external auditors, the failure towrite-off certain obsolete inventory and other inventory valuation issues.

The material weakness with respect to our Brazilian operations relates to an ineffective control environmentover financial reporting maintained by management in Brazil which began prior to 2009 through 2012 thatpermitted to go undetected during that period, intentional overrides of certain internal controls, as well as cross-functional collusion by management in Brazil and communication and actions by senior management in Brazilthat contributed to a lack of adherence to existing internal control procedures and IFRS. The errors reducedparent’s net investment by €22 million for the fiscal year 2011 and the impact to the first half of fiscal year 2012is insignificant. See Note 1 of our financial statements for more detail on the impact of these adjustments. Whilewe have put in place redesigned processes intended to enhance our internal control over financial reporting, untilwe have been able to test the operating effectiveness of these remediated internal controls, there can be noassurance that we will not discover additional deficiencies and weaknesses in our internal control over financialreporting any of which could have a material and adverse effect on our results of operations and financialcondition and our ability to comply with applicable financial reporting requirements.

We are subject to foreign currency exchange rate fluctuations.

Operating in international markets involves exposure to movements in currency exchange rates, which arevolatile at times. Movements in foreign exchange rates can affect our supply costs because a significant portionof our revenues are in euros, but we source green coffee, tea and other commodities in currencies other than theeuro. The impact on us of currency fluctuations may be substantial because we purchase coffee on forwardcontracts for delivery in the future, and such contracts are not generally adjusted for fluctuations in currency priorto the delivery date. Further, our currency hedges may not successfully reduce our exposure to currencyexchange rate fluctuations. Accordingly, a depreciation of non-euro currencies relative to the euro, or changes inthe relative value of any two currencies that we use for transactions, could have a material adverse effect on ourfinancial condition and results of operations.

We depend on sales from the Netherlands for a substantial portion of our sales in any fiscal period. Sales inthis country have recently declined and may continue to decline.

Our financial performance is highly dependent on sales in the Netherlands, which comprised approximately26% of our sales in fiscal 2012. Additionally, we rely on a small number of customers in the Netherlands for allof our sales in that country. Our financial performance may be affected by changes in the regulatory andeconomic environment in the Netherlands and in Western Europe generally or by financial difficultiesexperienced by key customers in the Netherlands or elsewhere. We have occasionally experienced decreases insales in this country, which has adversely affected our operating results. For example, our sales in theNetherlands decreased from fiscal 2009 to fiscal 2012. This was due in part to low spending on advertising andpromotion in the Netherlands during those years and our decision to introduce innovations, such as L’OREspressO, outside the Netherlands before we introduced such innovations in the Netherlands. If sales in theNetherlands continue to decline, our business and financial results will be adversely affected.

An impairment in the carrying value of goodwill or other acquired intangible assets could negatively affectour results of operations and shareholders’ equity.

The carrying value of goodwill represents the fair value of acquired businesses in excess of identifiableassets and liabilities as of the acquisition date. The carrying value of other intangible assets represents the fairvalue of trademarks, trade names and other acquired intangible assets as of the acquisition date. Goodwill and

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other acquired intangible assets expected to contribute indefinitely to our cash flows are not amortized, but areevaluated for impairment by our management at least annually. If the carrying value exceeds the recoverableamount as determined based on the higher of the discounted future cash flows of the related businesses and thefair value less costs to sell, the goodwill or other intangible asset is considered impaired and is reduced to therecoverable amount via a non-cash charge to earnings. Events and conditions that could result in impairmentcharges include further economic instability, further significant commodity price fluctuations, increasedcompetition, or other factors leading to reduction in sales or profitability. In addition, in January 2012, theBrazilian government revised the tax laws related to the export of green coffee. This may negatively impact theability of our Brazilian business to achieve targeted profit levels, which could trigger an impairment to the€32.2 million of goodwill that was allocated to this cash generating unit at the end of fiscal 2011. Wesubsequently made a decision to reduce our green coffee export business significantly. If the value of goodwill orother acquired intangible assets is impaired, our results of operations and shareholders’ equity could be adverselyaffected.

The success of our business depends substantially on consumer perceptions of our brands.

We believe that maintaining and continually enhancing the value of our brands is critical to the success ofour business. Brand value is based in large part on consumer perceptions. Success in promoting and enhancingbrand value depends in large part on our ability to provide high quality products and continued innovation. Brandvalue could diminish significantly as a result of a number of factors, such as if we fail to preserve the quality ofour products, if we are perceived to act in an irresponsible manner, if we or our brands otherwise receive negativepublicity, if the brands fail to deliver a consistently positive consumer experience or if the products becomeunavailable to consumers. If our brand values are diminished, our revenues and operating results could bematerially adversely affected.

Our financial results and achievement of our growth strategy is dependent on our ability to maintain thestrong brand image of our existing products, our ability to successfully develop and launch new productsand product extensions and on marketing of existing products.

Achievement of our growth strategy is dependent, among other things, on our ability to maintain the strongbrand image of our existing products, our ability to successfully develop and launch new products and productextensions and on marketing of existing products. Although we devote significant focus to the development ofnew products, we may not be successful in developing innovative new products or our new products may not becommercially successful. Our financial results and our ability to maintain or improve our competitive positionwill depend on our ability to effectively gauge the direction of our key markets and successfully identify,develop, manufacture, market and sell new or improved products in these changing markets.

The future growth of our business may be adversely affected if we are unable to effectively expand ininternational and emerging markets.

Our growth strategy includes the expansion of our sales in our existing markets and new internationalmarkets, including emerging markets. Expansion in emerging markets, including expansion of our sales andoperations in Brazil, involves significant business and legal risks. These risks include, but are not limited to:changes in economic, political or regulatory conditions; difficulties in managing geographically diverseoperations; changes in business regulation; effects of foreign currency movements; difficulties in enforcingcontracts and cultural and language barriers. If we fail to address one or more of these challenges, our businessand financial performance may be materially adversely affected.

We are subject to intellectual property infringement risk that could adversely affect our business.

Our existing products or our introduction of new products or product extensions may generate litigation orother legal proceedings against us by competitors claiming infringement or other violation of their intellectualproperty rights, which could negatively impact our results of operations. For example, Nestlé has filed suit

12

against several of our subsidiaries claiming patent and trademark infringement in connection with our sales ofL’OR EspressO and L’aRôme EspressO. Because sales of the L’OR EspressO and L’aRôme EspressO single-serve capsules have served as a significant source of our sales growth in recent periods, our results of operationsmay be adversely affected by a negative outcome in this litigation. For more information on the Nestlé litigation,see the section of this Annual Report entitled “Legal Proceedings” in Item 8. Intellectual property litigation canbe complex and expensive, and outcomes are difficult to predict. An adverse result in an intellectual propertylitigation could subject us to liabilities and/or require us to seek licenses from third parties, which may not beavailable on satisfactory terms. As a result, intellectual property challenges against us could have an adverseeffect on our business, operating results and financial condition.

Failure to maximize or to successfully assert our intellectual property rights could impact ourcompetitiveness.

We rely on trademark, trade secret, patent and copyright laws to protect our intellectual property rights. Wecannot be sure that these intellectual property rights will be maximized or that they can be successfullymaintained or asserted. There is a risk that we will not be able to obtain, maintain and perfect our own or, whereappropriate, license intellectual property rights necessary to support our current products and new productintroductions. Accordingly, our products, product development efforts and new product introductions may not beprotected or protectable pursuant to intellectual property rights. In addition, we cannot be sure that these rightswill not be invalidated, circumvented or challenged. Further, even if such rights are obtained in the United States,the EU, or individual European countries, the laws of some of the countries in which our products are or may besold may not protect our intellectual property rights to the same extent as the laws of the United States, the EU orindividual European countries.

Additionally, in certain jurisdictions rights in trademarks are derived from registration of such trademarks insuch jurisdiction. Trademark registrations for the Aroma Lady logo, which appears on our Douwe Egbertsbranded products, and the Cafitesse brand in certain countries in the Middle East are held on our behalf byanother party with whom we are currently in a dispute and, accordingly, our ability to sell products under thesebrands into such Middle Eastern countries may be materially adversely affected by this dispute. For moreinformation on these disputes, see the section of this Annual Report entitled “Legal Proceedings” in Item 8. Ourfailure to perfect or successfully assert our intellectual property rights could make us less competitive and couldhave an adverse effect on our business, operating results and financial condition.

Many of our production processes are not proprietary, so competitors may be able to duplicate them, whichcould harm our competitive position.

We consider the production methods for many of our products essential to the quality, flavor and richness ofour coffees and, therefore, essential to our brands. Because these methods are not patented, we would be unableto prevent competitors from copying these methods if such methods became known. If our competitors copy ourmethods, the value of our brands may be diminished, and we may lose customers to our competitors. In addition,competitors may be able to develop production methods that are more advanced than our production methods,which may also harm our competitive position.

Our business operations could be disrupted if our information technology systems fail to performadequately.

We rely on our information technology systems to effectively manage and operate many of our key businessfunctions, including our supply management, product manufacturing and distribution, order processing and otherbusiness processes. The failure of our information technology systems to perform could disrupt our business andresult in supply management errors, production inefficiencies and the loss of sales and customers, causing ourbusiness and results of operations to suffer. In addition, our information technology systems may be vulnerable to

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damage or interruption from circumstances beyond our control, including fire, natural disasters, system failures,security breaches and viruses. Any such damage or interruption could have a material adverse effect on ourbusiness.

Our operating results may have significant fluctuations from period to period which could have a negativeeffect on our stock price.

Our operating results may fluctuate from period to period or within certain periods as a result of a number offactors, including fluctuations in the price and supply of green coffee and tea, fluctuations in the selling prices ofour products, currency fluctuations, the success of our green coffee and currency hedging strategies, competitionfrom existing or new competitors in our industry, changes in consumer preferences, and our ability to manageinventory and fulfillment operations and maintain gross margins. Fluctuations in our operating results as a resultof these factors or for any other reason could cause our stock price to decline. Accordingly, we believe thatperiod-to-period comparisons of our operating results are not necessarily meaningful, and such comparisonsshould not be relied upon as indicators of future performance.

Adverse public or medical opinions about caffeine or reports of incidents involving food-borne illness andtampering may harm our business.

Coffee and tea contain caffeine and other active compounds, the health effects of some of which are notfully understood. A number of research studies conclude or suggest that excessive consumption of caffeine maylead to increased adverse health effects. Caffeine levels vary between blends and we may be restricted in theproduction of certain blends due to the level of caffeine in the blends. Additional unfavorable reports on thehealth effects of caffeine or other compounds present in coffee or tea could significantly reduce the demand forcoffee or tea, which could harm our business and reduce our sales.

If our products become contaminated or mislabeled, we might need to recall those items and mayexperience product liability claims if consumers are injured.

We may need to recall some of our products if they spoil, become contaminated, are tampered with or aremislabeled. A widespread product recall could result in adverse publicity, an inability to maintain sufficientstocks of our products, damage to our reputation and a loss of consumer confidence in our products, which couldhave a material adverse effect on our business results and the value of our brands. We also may be subject toliability if our products or operations violate applicable laws or regulations, or in the event our products causeinjury, illness or death. In addition, we could be the target of claims that our advertising is false or deceptiveunder the laws of the jurisdictions in which we operate, including consumer protection laws. Even if a productliability or consumer fraud claim is unsuccessful or is without merit, the negative publicity surrounding suchassertions regarding our products could adversely affect our reputation and brand images.

Changes in consumer preferences could adversely affect our business.

Our continued success depends, in part, upon the demand for coffee and tea. Competition from otherbeverages may dilute the demand for coffee and tea. Consumers who choose soft drinks, juices, bottled water andother beverages may reduce spending on coffee and tea. Because we are highly dependent on consumer demandfor coffee and tea, a shift in consumer preferences away from coffee and tea would harm our business more thanif we had more diversified product offerings.

Our success depends largely on the continued availability of certain personnel.

Much of our future success depends on the continued availability of skilled personnel and other keyemployees with historical knowledge of our Company, our industry and coffee purchasing and blending. If weare unable to attract and retain such talented, highly qualified skilled personnel and other key employees, ourbusiness may be adversely affected.

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Severe weather patterns may increase commodity costs, damage our facilities and impact or disrupt ourproduction capabilities and supply chain.

There is increasing concern that a gradual increase in global average temperatures has caused and willcontinue to cause significant changes in weather patterns around the globe and an increase in the frequency andseverity of extreme weather events. Major weather phenomena have dramatically affected and may continue toaffect coffee growing countries. The wet and dry seasons are becoming unpredictable in timing and duration,causing improper development of the coffee berries. Changing weather patterns may affect the quality, limitavailability or increase the cost of key agricultural commodities, such as green coffee and tea, which are the keyraw materials for our products. Increased frequency or duration of extreme weather conditions could also damageour facilities, impair production capabilities or disrupt our supply chain. As a result, the effects of climate changecould have a long-term adverse impact on our business and results of operations.

In addition, increased government regulations or demands from key retailers to limit carbon dioxide andother greenhouse gas emissions as a result of concern over climate change may result in increased compliancecosts, capital expenditures and other financial obligations for us. We use natural gas, diesel fuel, and electricity inthe manufacturing and distribution of our products. Legislation or regulation affecting these inputs couldmaterially adversely affect our profitability. In addition, climate change could affect our ability to procure neededcommodities at costs and in quantities currently available to us and may require us to make additional unplannedcapital expenditures.

Changes in regulations or failure to comply with existing regulations could affect our product sales,financial condition and results of operations.

As a manufacturer of products intended for human consumption, we are subject to extensive legislation andregulation in the EU and in each of the countries in which we do business with respect to: product composition,manufacturing, storage, handling, packaging, labeling, advertising and the safety of our products; the health,safety and working conditions of our employees; our pensions; and our competitive and marketplace conduct.We perform laboratory analyses on incoming ingredient shipments for the purpose of assuring that they meet ourquality standards as well as those of the EU and each of the countries in which we do business. Our operationsand properties, past and present, are also subject to a wide variety of EU and local laws and regulationsgoverning: air emissions, waste water discharge, noise levels, energy efficiency; the presence, use, storage,handling, generation, treatment, emission, release, discharge and disposal of hazardous materials, substances andwastes; and the remediation of contamination to the environment. Existing legislation and modification toexisting legislation and/or regulation and the introduction of new legislative and regulatory initiatives may affectour operations and the conduct of our businesses, and the cost of complying with such legislation or modifiedand/or new legislation or regulation or the effects of such legislation or modified and/or new legislation orregulation may have an adverse effect on our product sales, financial condition and results of operations.Additionally, our selling practices are regulated by competition authorities in the jurisdictions in which weoperate. A finding that we are in violation of, or out of compliance with, applicable laws or regulations couldsubject us to civil remedies, including fines, damages, injunctions or product recalls, or criminal sanctions, any ofwhich could adversely affect our business.

We are dependent upon access to external sources of capital to grow our business.

Our business strategy contemplates future access to debt and equity financing to fund the expansion of ourbusiness. Recent events in the financial markets have had an adverse impact on the credit markets and equitysecurities which have exhibited a high degree of volatility. The inability to obtain sufficient capital to fund theexpansion of our business or to refinance debt as it comes due could have a material adverse effect on us. Inaddition, a downgrade in our credit rating could make it difficult or prohibitively expensive to borrow, whichcould have a material adverse effect on us.

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If we pursue strategic acquisitions or divestitures, we may not be able to successfully consummate favorabletransactions or successfully integrate acquired businesses.

We may consider acquisitions, joint ventures and divestitures as a means of enhancing shareholder valueand furthering our strategic objectives. Acquisitions and joint ventures involve financial and operational risks anduncertainties, including difficulty identifying suitable candidates or consummating a transaction on terms that arefavorable to us; inability to achieve expected returns that justify the investments made; potential impairmentresulting from overpayment for an acquisition; difficulties integrating acquired companies and operating jointventures, retaining the acquired businesses’ customers and brands, and achieving the expected financial resultsand benefits of the transaction, such as cost savings and revenue growth from geographic expansion or productextensions; inability to implement and maintain consistent standards, controls, procedures and informationsystems; and diversion of management’s attention from our core businesses.

The global nature of our business and the resolution of tax disputes will create volatility in our effective taxrate.

As a global business, our tax rate from period to period will be affected by many factors, including changesin tax legislation and the manner in which such legislation is interpreted or enforced, our global mix of earnings,the tax characteristics of our income, the timing and recognition of goodwill impairments, acquisitions anddispositions, adjustments to our reserves related to uncertain tax positions, changes in valuation allowances andthe portion of the income of non-U.S. subsidiaries that we expect to remit to DE US, Inc. and that will be taxable.Although we are targeting an effective tax rate of approximately 25% in fiscal years 2014 and 2015, noassurances can be made in this regard. A higher than anticipated effective tax rate could have an adverse impacton our financial condition and results of operations.

In addition, significant judgment will be required in determining our effective tax rate and in evaluating ourtax positions. We will establish a reserve for certain tax contingencies when, despite the belief that our tax returnpositions are fully supported, we believe that certain positions will be challenged and may not be fully sustained.The tax reserve will be adjusted in light of changing facts and circumstances, such as the progress of tax audits,case law and emerging legislation. Our effective tax rate will include the impact of tax reserve and changes to thereserve, including related interest and penalties, as considered appropriate by management. When particularmatters arise, a number of years may elapse before such matters are audited and finally resolved. Unfavorableresolution of any particular issue could increase the effective tax rate and may require the use of cash in the yearof resolution. We are currently disputing notices received from tax authorities in jurisdictions, including Brazil,alleging underpayment of certain taxes. Although we believe that our positions with respect to these matters arecorrect, there can be no assurance that we will prevail or that any such amounts if ultimately determined to bepayable by us will not have a material and adverse effect on our results of operations or cash flows.

Risks Related to the Separation

As of the end of our fiscal year 2012, we had no operating history as an independent, publicly tradedcompany and our historical financial information is not necessarily indicative of our future financial condition,future results of operations or future cash flows nor does it reflect what our financial condition, results ofoperations or cash flows would have been as an independent public company during the periods presented.

Our business separated from the other businesses of Sara Lee on June 28, 2012. The historical financialinformation set forth herein for the fiscal years ended June 30, 2012, July 2, 2011 and July 3, 2010 does notreflect what our financial condition, results of operations or cash flows would have been as an independent publiccompany during those periods and is not necessarily indicative of our future financial condition, future results ofoperations or future cash flows. This is primarily a result of the following factors:

• our historical financial results reflect allocations of expenses for services historically provided by SaraLee, and those allocations may be significantly higher or lower than the comparable expenses wewould have incurred as an independent company;

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• we have historically participated in Sara Lee’s corporate-wide cash management programs, and ourcost of debt and other capital may be significantly different from that reflected in our historicalfinancial statements; and

• the historical financial information may not fully reflect the increased costs associated with being anindependent public company, including significant changes that will occur in our cost structure,management, financing arrangements and business operations as a result of our separation from SaraLee, including costs associated with our internal restructuring and all the costs related to being anindependent public company.

We may be unable to achieve some or all of the benefits that we expect to achieve as an independent,publicly traded company.

By separating from Sara Lee there is a risk that we may be more susceptible to market fluctuations and otheradverse events than we would have otherwise been were we still a part of Sara Lee. In addition, we incurredsignificant costs in connection with our separation from Sara Lee, which may ultimately exceed our estimates.As part of Sara Lee, we were able to enjoy certain benefits from Sara Lee’s operating diversity and purchasingleverage, as well as its economies of scope and scale in costs, employees, vendor relationships and customerrelationships. If we are unable to achieve these benefits, that would have an adverse effect on our results ofoperations.

Potential indemnification liabilities to Hillshire and liabilities related to divestures assumed pursuant to theseparation agreements could materially and adversely affect our business, financial condition, results ofoperations and liquidity.

In connection with the separation, we entered into a master separation agreement with Hillshire thatprovided for, among other things, the principal corporate transactions required to effect the separation, certainconditions to the separation and provisions governing the relationship between the Company and Hillshire withrespect to and resulting from the separation. For a description of the master separation agreement, see “RelatedParty Transactions—Agreements with Sara Lee Corporation—Master Separation Agreement” located inItem 7B. Among other things, the master separation agreement provides for indemnification obligations andobligations to assume liabilities towards third parties designed to make us financially responsible forsubstantially all liabilities that may exist relating to our downstream business activities, whether incurred prior toor after the separation, as well as those obligations of Hillshire assumed by us pursuant to the master separationagreement, including certain liabilities related to divestitures made by Hillshire prior to the separation, includingthe divestitures of its former household and body care and international bakery businesses. In connection with theseparation, we have also entered into other agreements with Hillshire that impose indemnification and otherobligations on us. If we are required to indemnify Hillshire or third parties, we may be subject to substantialliabilities, which may have a material adverse effect on our business, financial condition, results of operationsand liquidity.

In connection with our separation from Hillshire, Hillshire will indemnify us for certain liabilities.However, there can be no assurance that the indemnity will be sufficient to insure us against the fullamount of such liabilities, or that Hillshire’s ability to satisfy its indemnification obligation will not beimpaired in the future.

Pursuant to the master separation agreement, Hillshire has agreed to indemnify us for certain liabilities.However, third parties could seek to hold us responsible for any of the liabilities that Hillshire has agreed toretain, and there can be no assurance that the indemnity from Hillshire will be sufficient to protect us against thefull amount, or any, of such liabilities, or that Hillshire will be able to satisfy its indemnification obligations.Moreover, even if we ultimately succeed in recovering from Hillshire any amounts for which we are held liable,we may be temporarily required to bear these losses ourselves. Hillshire’s insurers may deny coverage to us for

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liabilities associated with occurrences prior to the separation. Even if we ultimately succeed in recovering fromsuch insurance providers, we may be required to temporarily bear such loss of coverage. If Hillshire is unable tosatisfy its indemnification obligations or if insurers deny coverage, the underlying liabilities could have amaterial adverse effect on our business, financial condition, results of operations and liquidity.

We may be unable to make, on a timely or cost-effective basis, the changes necessary to operate as anindependent, publicly owned company subject to the reporting requirements of the SEC and Dutch law.

Our business has historically relied on Hillshire for various financial, treasury, tax and other corporateservices and information technology systems to support our operations. Since the separation, Hillshire continuesto supply us certain of these services and systems, generally on a short-term transitional basis. However, we arerequired to establish the necessary infrastructure and systems to supply these services and systems on an ongoingbasis. We may not be able to replace these services and systems provided by Hillshire in a timely or cost-effective manner or on terms and conditions as favorable as those we receive from Hillshire.

In addition, as a public entity, we are subject to the reporting requirements of the SEC. In addition to theannual and current reports that we are required to file with the SEC, Dutch law requires that we file annual, semi-annual and interim reports with respect to our business and financial condition. We implemented additionalprocedures and processes for the purpose of addressing the standards and requirements applicable to Dutchpublic companies listed on NYSE Euronext Amsterdam and companies subject to SEC reporting requirements.These activities may divert management’s attention from other business concerns, which could have a materialadverse effect on our business, financial position, results of operations or cash flows.

We may have been able to receive better terms from unaffiliated third parties than the terms we receive inour agreements with Hillshire.

The agreements related to the separation were negotiated in the context of our separation from Hillshirewhile we were still part of Hillshire. Accordingly, these agreements may not reflect terms that would haveresulted from arm’s-length negotiations among unaffiliated third parties. The terms of the agreements negotiatedin the context of our separation were related to, among other things, allocations of assets, liabilities, rights,indemnifications and other obligations among Hillshire and us. We may have received better terms from thirdparties because third parties may have competed with each other to win our business. see “Related PartyTransactions—Agreements with Sara Lee Corporation” located in Item 7B.

Under the U.S. federal bankruptcy law and similar provisions of state fraudulent transfer laws, a courtcould deem the separation or certain related internal restructuring transactions as fraudulent transfers.

Under the U.S. federal bankruptcy law and similar provisions of state fraudulent transfer laws, a court coulddeem the separation or certain related internal restructuring transactions as fraudulent transfers, if the court heldthat such transactions:

• were consummated with the intent to hinder, delay or defraud Hillshire’s existing or future creditors; or

• Hillshire received less than reasonably equivalent value or did not receive fair consideration for thetransactions and Hillshire:

• was insolvent or rendered insolvent at the time of the transfers;

• was engaged in a business or transaction for which Sara Lee’s remaining assets constitutedunreasonably small capital; or

• Sara Lee intended to incur, or believed that it would incur, debts beyond its ability to pay suchdebts generally as they mature.

A court likely would find that Hillshire did not receive reasonably equivalent value or fair consideration forthe transfers related to the separation. The issue, therefore, will be whether at the time of the transfers Sara Lee

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was insolvent or rendered insolvent, was left with unreasonably small capital or was unable to pay its debts whenthey become due. The measures of insolvency for purposes of these fraudulent transfer laws will vary dependingupon the law applied in any proceeding to determine whether a fraudulent transfer has occurred. Generally,however, a party would be considered insolvent if:

• the sum of its debts, including contingent liabilities, was greater than the sum of its property, at a fairvaluation;

• the present fair saleable value of its assets was less than the amount that would be required to pay itsprobable liability on its existing debts, including contingent liabilities, as they become absolute andmature; or

• it could not pay its debts as they become due.

We cannot be sure what standard a court would apply in making these determinations. The remedy for afraudulent transfer is to void the transfer and return the property to the transferor.

Certain of our directors and officers may have actual or potential conflicts of interest because of theirequity ownership in Sara Lee.

Because of their current or former positions with Hillshire or Sara Lee, certain of our directors andexecutive officers own shares of Hillshire common stock or hold other equity interests or options to acquireshares of Hillshire. These officers and directors may continue to own shares of Hillshire Brands common stock orother Hillshire equity interests and the individual holdings may be significant for some of these individualscompared to their total assets. This ownership may create, or may create the appearance of, conflicts of interestwhen these directors and officers are faced with decisions that could have different implications for Sara Lee andthe Company.

For example, potential conflicts of interest could arise in connection with the resolution of any dispute thatmay arise between us and Sara Lee regarding the terms of the agreements governing the separation and therelationship thereafter between the companies. Potential conflicts of interest could also arise if we and Sara Leeenter into additional commercial arrangements with each other in the future.

Concerns about our prospects as a stand-alone company could affect our ability to retain employees.

The separation represented a substantial organizational and operational change and our employees mighthave concerns about our prospects as a stand-alone company, including our ability to successfully operate thenew entity and our ability to maintain our independence. If we are not successful in assuring our employees ofour prospects as an independent company, our employees might seek other employment, which could materiallyadversely affect our business.

If the distribution does not qualify as tax-free for U.S. federal income tax purposes, tax could be imposed onSara Lee and Sara Lee shareholders; DE US, Inc. may be required to indemnify Sara Lee for the tax, andDE US, Inc.’s potential indemnification liabilities to Sara Lee could materially and adversely affect D.EMASTER BLENDERS’ business, financial condition, results of operations and liquidity.

Sara Lee received from the U.S. Internal Revenue Service (the “IRS”) a private letter ruling (the “IRSRuling”) to the effect that the distribution and certain related transactions, including the debt exchange, qualifiedas tax-free to Sara Lee, DE US, Inc., which became a wholly-owned subsidiary of the Company as part of theseparation-and Sara Lee shareholders for U.S. federal income tax purposes under Sections 355, 368(a) (1)(D) and361 of the U.S. Internal Revenue Code of 1986 (the “Code”). Sara Lee also received an opinion of counsel thatthe distribution and certain related transactions should qualify as tax-free to Sara Lee, DE US, Inc. and Sara Leeshareholders under Sections 355, 368(a)(1)(D) and 361 of the Code. However, if the factual representations or

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assumptions made in connection with the IRS Ruling or opinion of counsel are untrue or incomplete in anymaterial respect, or any material forward-looking covenants or undertakings are not complied with, or if theapplicable law on which the IRS Ruling and opinion of counsel are based is changed with retroactive effect, thenSara Lee would not be able to rely on the IRS Ruling or the opinion of counsel. If the distribution failed toqualify as tax-free under the aforementioned Code provisions, then Sara Lee would recognize a substantial gainfor U.S. federal income tax purposes and Sara Lee shareholders would recognize substantial taxable income.

As described above, the distribution was also conditioned upon the receipt by Sara Lee of an opinion ofcounsel to the effect that the distribution and certain related transactions, including the debt exchange, wouldqualify as tax-free to Sara Lee, DE US, Inc. and Sara Lee shareholders under Sections 355, 368(a)(1)(D), and 361and related provisions of the Code. Sara Lee received such opinion, along with the opinions addressing Sections367, 368 and 7874 of the Code, at the effective time of the distribution. The opinions relied on the IRS Ruling asto matters covered by the IRS Ruling. The tax opinions also are based on, among other things, assumptions andrepresentations that have been received from Sara Lee, DE US, Inc. and the company, including thoserepresentations contained in certificates of officers of Sara Lee, DE US, Inc. and the company, as requested bycounsel. If any of those factual representations or assumptions were to be untrue or incomplete in any materialrespect, any undertaking was not complied with, or the facts upon which the opinions are and will be based wereto be materially different from the facts at the time of the distribution, the distribution may not qualify underSections 355, 368(a)(1)(D) and 361 of the Code.

The conclusions in the tax opinion from counsel are based on then-existing legal authority. With respect tocertain conclusions as to which there is no authority directly on point, such conclusions are based upon areasoned analysis and interpretation of relevant analogous authorities. The opinion is not binding on the IRS orthe courts, and there can be no assurance that the IRS or the courts would not challenge the conclusions stated inthe opinion or that any such challenge would not prevail. Thus, notwithstanding the receipt by Sara Lee of theIRS Ruling and an opinion of counsel, the IRS could assert that the distribution should be treated as a taxabletransaction in whole or in part, if, among other things, it determines that any of the representations, assumptionsor undertakings that were included in the request for the IRS Ruling is untrue or has not been complied with or ifit disagrees with the conclusions in the opinion that are not covered by the IRS Ruling. If the IRS were to prevailin such challenge, the tax consequences to Sara Lee or the Sara Lee shareholders could be material. DE US, Inc.is not aware of any facts or circumstances that would cause any such factual statements or representations in theIRS Ruling or the tax opinion to be incomplete or untrue or cause the facts on which the IRS Ruling is based, orthe tax opinion is be based, to be materially different from the facts at the time of the distribution.

Even if the distribution were otherwise to qualify as tax-free under Sections 355, 368(a)(1)(D) and 361 ofthe Code, it may be taxable to Sara Lee (but not to Sara Lee’s shareholders) under Section 355(e) of the Code, ifthe distribution were later deemed to be part of a plan (or series of related transactions) pursuant to which one ormore persons acquire, directly or indirectly, stock representing a 50% or greater interest in Sara Lee or DE US,Inc.. For this purpose, any acquisitions of Sara Lee stock, DE US, Inc. common stock, or D.E MASTERBLENDERS common stock within the period beginning two years before the distribution and ending two yearsafter the distribution are presumed to be part of such a plan, although DE US, Inc. or Sara Lee may be able torebut that presumption. For this purpose, the acquisitions of DE US, Inc. common stock by D.E MASTERBLENDERS and of D.E MASTER BLENDERS common stock by Sara Lee’s shareholders, in the merger shouldnot be treated as acquisitions.

Although any taxes resulting from the distribution not qualifying under Sections 355, 368(a)(1)(D) and 361of the Code generally would be imposed on Sara Lee shareholders and Sara Lee, under the tax sharingagreement, DE US, Inc. would be required to indemnify Sara Lee and its affiliates against all tax-relatedliabilities caused by the failure of the distribution to so qualify (including as a result of Section 355(e) of theCode) to the extent these liabilities arise as a result of any action (or failure to act) of DE US, Inc. or of itsaffiliates, including D.E MASTER BLENDERS, following the distribution or otherwise result from any breachof certain representations, covenants or obligations of DE US, Inc. or any of its affiliates, including D.E

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MASTER BLENDERS, concerning a party’s plan or intention with respect to actions or operations after thedistribution date. Further, under the tax sharing agreement, DE US, Inc. would be required to indemnify Sara Leeand its affiliates against 50% of all tax-related liabilities caused by the failure of the distribution to qualify underSections 355, 368(a)(1)(D) and 361 of the Code to the extent these liabilities (1) do not arise as a result of anyaction (or failure to act) of Sara Lee, DE US, Inc. or any of their respective affiliates, following the distributionand do not otherwise result from any breach of any representation, covenant or obligation of Sara Lee, DE US,Inc. or any of their respective affiliates, or (2) arise due to an action (or failure to act), misrepresentation oromission of Sara Lee, DE US, Inc. or their respective affiliates prior to the date of the distribution not concerninga party’s plan or intention with respect to actions or operations after the distribution date. See “Related PartyTransactions—Agreements with Sara Lee Corporation—Tax Sharing Agreement” located in Item 7B. DE US,Inc.’s indemnification obligations to Sara Lee and its affiliates are not limited in amount or subject to any cap. Itis expected that any amount of such taxes to Sara Lee would be substantial. If the above-mentioned tax-relatedrisks materialize this could have a material adverse effect on our liquidity and financial position.

D.E MASTER BLENDERS and DE US, Inc. are subject to certain restrictions as a result of the separationin order to preserve the tax-free treatment of the distribution, which may reduce D.E MASTERBLENDERS’ strategic and operating flexibility.

The covenants in, and DE US, Inc.’s indemnity obligations under, the tax sharing agreement may limit theability of D.E MASTER BLENDERS and DE US, Inc. to pursue strategic transactions or engage in new businessor other transactions that may maximize the value of its business. The covenants in, and DE US, Inc.’s indemnityobligations under, the tax sharing agreement will also limit its ability to modify the terms of, prepay, or otherwiseacquire any of the DE US, Inc. debt securities.

D.E MASTER BLENDERS and DE US, Inc. agreed not to enter into any transaction that could reasonablybe expected to cause any portion of the distribution to be taxable to Sara Lee, including under Section 355(e) ofthe Code as mentioned above. DE US, Inc. also agreed to indemnify Sara Lee for any tax liabilities resultingfrom any such transactions. The amount of any such indemnification could be substantial. Further, as it relates toSection 355(e) of the Code specifically, these covenants and indemnity obligations might discourage, delay orprevent a change of control that D.E MASTER BLENDERS shareholders may consider favorable. For additionaldetail, see “Related Party Transactions—Agreements with Sara Lee Corporation—Tax Sharing Agreement”located in Item 7B.

Our ability to repurchase our shares is limited as a result of the separation.

In connection with both the IRS Ruling and the tax opinion of counsel, we represented that we had no plan orintention to redeem, repurchase or otherwise acquire more than 20% of our outstanding stock. The covenants in, andDE US, Inc.’s indemnity obligations under, the tax sharing agreement limits our ability to redeem, repurchase orotherwise acquire more than 20% of our outstanding stock as part of a plan that includes the distribution.

DE US, Inc. is subject to continuing contingent liabilities of Sara Lee.

There are several significant areas where the liabilities of Sara Lee may become DE US, Inc.’s obligations.For example, under the Code and the related rules and applicable Treasury Regulations, each corporation thatwas a member of the Sara Lee consolidated tax reporting group during any taxable period or portion of anytaxable period ending on or before the effective time of the distribution is severally liable for the U.S. federalincome tax liability of the entire Sara Lee consolidated tax reporting group for that taxable period. In connectionwith the separation, DE US, Inc. entered into a tax sharing agreement with Sara Lee that allocates theresponsibility for prior period taxes of the Sara Lee consolidated tax reporting group between DE US, Inc. andSara Lee. See “Related Party Transactions—Agreements with Sara Lee Corporation—Tax Sharing Agreement”located in Item 7B. If Sara Lee is unable to pay any prior period taxes for which it is responsible, DE US, Inc.

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could be required to pay the entire amount of such taxes. Other provisions of federal law establish similarliability for other matters, including laws governing tax-qualified pension plans as well as other contingentliabilities. If DE US, Inc. is subject to any such liabilities, that may have a material adverse effect on theCompany’s business, financial condition, results of operations and liquidity.

D.E MASTER BLENDERS may be treated as a U.S. corporation for U.S. federal income tax purposesfollowing the merger of its subsidiary with DE US, Inc.

For U.S. federal income tax purposes, a corporation generally is considered tax resident in the place of itsincorporation. Because D.E MASTER BLENDERS is incorporated under Dutch law, it should be deemed aDutch corporation under this general rule. However, Section 7874 of the Code generally provides that acorporation incorporated outside the United States that acquires substantially all of the assets of a corporationincorporated in the United States will be treated as a U.S. corporation (and, therefore, a U.S. tax resident) forU.S. federal income tax purposes if shareholders of the acquired U.S. corporation own at least 80 percent (ofeither the voting power or the value) of the stock of the acquiring foreign corporation group after the acquisitionand the acquiring foreign corporation’s “expanded affiliated group” does not have “substantial businessactivities” in the country in which the acquiring foreign corporation is organized. Pursuant to the merger, D.EMASTER BLENDERS acquired all of DE US, Inc.’s assets, and DE US, Inc. shareholders hold 100 percent ofD.E MASTER BLENDERS by virtue of their stock ownership of DE US, Inc. As a result, D.E MASTERBLENDERS should be treated as a foreign corporation for U.S. federal income tax purposes under Section 7874of the Code provided that the D.E MASTER BLENDERS group has substantial business activities in theNetherlands. Under the rules applicable to D.E MASTER BLENDERS, at the time of the merger, there was nospecific guidance as to what constitutes “substantial business activities”. Based on the historical conduct of thecoffee and tea business in the Netherlands, the relative amount of assets, employees and sales located in theNetherlands, the substantial managerial activities by officers and employees in the Netherlands, and the Dutchbusiness activities that are material to the Group’s overall business activities, in each case at the time of themerger, D.E MASTER BLENDERS believes that its expanded affiliated group should have substantial businessactivities in the Netherlands. As a result, D.E MASTER BLENDERS should not be treated as a U.S. corporationfor U.S. federal income tax purposes under Section 7874 of the Code following the merger, and the Companyobtained an opinion of counsel to that effect. Nevertheless, it is possible that the IRS would interpretSection 7874 of the Code to treat D.E MASTER BLENDERS as a U.S. corporation after the merger. Moreover,the U.S. Congress or the IRS and Treasury Department may enact new statutory or regulatory provisions thatcould adversely affect D.E MASTER BLENDERS’ status as a foreign corporation. Retroactive statutory orregulatory actions have occurred in the past, and there can be no assurance that any such provisions, if enacted orpromulgated, would not have retroactive application to D.E MASTER BLENDERS.

If it were determined that D.E MASTER BLENDERS is properly treated as a U.S. corporation for U.S.federal income tax purposes, D.E MASTER BLENDERS could be liable for substantial additional U.S. federalincome tax. For Dutch corporate income tax and dividend withholding tax purposes, D.E MASTER BLENDERSwill, regardless of any application of Section 7874 of the Code, be treated as a Dutch resident company since D.EMASTER BLENDERS is incorporated under Dutch law. The Tax Convention concluded between theNetherlands and the United States will not fully limit the ability of the Netherlands to levy such taxes.Consequently, the Company might be liable for both Dutch and U.S. taxes, which would have a material adverseeffect on our financial condition and results of operations.

Additionally, D.E MASTER BLENDERS shareholders could face certain adverse tax consequences if itwere determined that the Company were properly treated as a U.S. corporation for U.S. federal income taxpurposes. With respect to U.S. Holders, the U.S. consequences of owning and disposing of shares of D.EMASTER BLENDERS generally would be the same as those of owning and disposing of shares of a foreigncorporation, as described in “Taxation—Taxation in the United States” in Item 10E. However, U.S. Holdersgenerally would not be able to claim a U.S. foreign tax credit with respect to any Dutch taxes withheld by theCompany on distributions unless the U.S. Holder had other foreign source income. With respect to shareholders

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that are not U.S. Holders, because the Company would continue to be treated as a Dutch corporation for Dutchwithholding tax purposes, such shareholders could be subject to dividend withholding under both U.S. and Dutchlaw absent an applicable exemption.

Our ability to utilize certain non-U.S. tax attributes is uncertain.

We could lose certain non-U.S. tax attributes, or our ability to utilize such attributes may be limited, if theseparation is viewed as a “change of control” under the laws of certain of the jurisdictions in which we havenon-U.S. tax attributes. Any such limitations or loss of attributes could have an adverse impact on our financialcondition or results of operations.

We may be subject to U.S. and non-U.S. tax risks as a result of post-separation restructuring.

D.E MASTER BLENDERS and DE US, Inc. undertook certain internal restructuring and financingtransactions after the separation, which could result in the imposition of U.S. and non-U.S. taxes. Sara Leereceived an opinion of counsel to the effect that these transactions should not result in material U.S. federalincome tax. The opinion is not binding on the IRS or the courts. If the IRS were to successfully challenge theconclusions stated in the opinion, DE US, Inc. could be subject to a material U.S. federal income tax liability, andDE US, Inc. may be subject to a higher effective tax rate on a going forward basis. Furthermore Sara Leeobtained advance clearance on certain elements of the post-separation restructuring from non-U.S. local taxauthorities. Nevertheless, such local tax authorities could successfully challenge at least part of the restructuring,since not all countries and/or elements are covered by these advance agreements.

Risks Related to Our Ordinary Shares

Because the public market for our ordinary shares is relatively new, the market price and trading volume ofour ordinary shares may be volatile.

Trading of our ordinary shares on NYSE Euronext Amsterdam began on an as-if-and-when-issued basis andhave transitioned to regular way trading on July 9, 2012. The market price of our ordinary shares could fluctuatesignificantly due to a number of factors, many of which are beyond our control, including:

• fluctuations in our financial results or those of other companies in our industry;

• failures of our financial results to meet the estimates of securities analysts or the expectations of ourshareholders or changes by securities analysts in their estimates of our future earnings;

• announcements by us or our customers, suppliers or competitors;

• changes in laws or regulations which adversely affect our industry or us;

• changes in accounting standards, policies, guidance, interpretations or principles;

• general economic, industry and stock market conditions;

• the fact that our ordinary shares will not be listed on a U.S. stock exchange;

• the failure of our ordinary shares to be maintained in the AEX Index, the main index for securitieslisted on NYSE Euronext Amsterdam, or another similar index;

• future sales of our ordinary shares; and

• the other factors described in these “Risk Factors” and other parts of this Annual Report.

Our ordinary shares will only be transferable on NYSE Euronext Amsterdam if held in a securities accountthrough Euroclear Nederland.

D.E MASTER BLENDERS ordinary shares are listed only on NYSE Euronext Amsterdam. D.E MASTERBLENDERS ordinary shares will be ineligible for sale on NYSE Euronext Amsterdam unless they are held in a

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securities account through Euroclear Nederland. To facilitate the transfer of their D.E MASTER BLENDERSordinary shares into such a Euroclear Nederland-eligible account, shareholders who hold shares directly in theregister maintained by the exchange agent must have their D.E MASTER BLENDERS ordinary shares creditedto such a securities account by delivering or arranging for delivery of an instruction form to the exchange agent.Shareholders for whom a broker, bank or nominee has been registered as the owner of D.E MASTERBLENDERS ordinary shares on the register maintained by the exchange agent must have this broker, bank orother nominee deliver an instruction form duly executed by the broker, bank or other nominee.

Your percentage ownership in the Company may be diluted in the future.

As with any publicly traded company, your percentage ownership in the Company may be diluted if weissue ordinary shares in connection with acquisitions or other strategic transactions. Your percentage ownershipmay also be diluted by equity awards that we expect will be granted to our directors, officers and employees. Fora description of our stock incentive plan arrangements and the adjustments being made to outstanding Sara Leeequity awards held by individuals who became our directors, officers or employees, see “Treatment of Equity-Based Compensation in Separation” in Item 4.

We cannot assure you that we will pay dividends on our ordinary shares, and our indebtedness or ourfinancial condition could limit our ability to pay dividends on our ordinary shares.

Our general dividend policy is determined by our board of directors and will be discussed with ourshareholders at our annual general meeting of shareholders. Within the general dividend policy, our board ofdirectors will determine to what extent profits will be retained by way of a reserve. In making this determination,the board will consider our ability to declare and pay dividends in light of our future operations and earnings,capital expenditure requirements, general financial conditions, legal and contractual restrictions and other factorsthat it may deem relevant. There can be no assurance that we will pay a dividend in the future or continue to payany dividend if we do commence the payment of dividends. There can also be no assurance that the combinedannual dividends on Sara Lee common stock, if any, and our ordinary shares, if any, will be equal to the annualdividends on Sara Lee common stock prior to the separation. In addition, under Dutch law, we may only paydividends if our equity exceeds the sum of paid-in and called-up share capital plus the reserves as required to bemaintained by Dutch law or by our articles of association, which we refer to as our Articles.

Additionally, indebtedness that we incurred in connection with the debt exchange could have importantconsequences for holders of our ordinary shares. If we cannot generate sufficient cash flow from operations tomeet our debt payment obligations, then our ability to pay dividends, if so determined by the board of directors,will be impaired and we may be required to attempt to restructure or refinance our debt, raise additional capital ortake other actions such as selling assets or reducing or delaying capital expenditures. There can be no assurance,however, that any such actions could be effected on satisfactory terms, if at all, or would be permitted by theterms of our new debt or our other credit and contractual arrangements, including the tax sharing agreement.

Any dividend payments on our ordinary shares would be declared in euro, and any shareholder whoseprincipal currency is not the euro would be subject to exchange rate fluctuations.

The ordinary shares are, and any dividends or distributions from the dividend reserve allocated to theordinary shares to be declared in respect of them, if any, will be, denominated in euro. Shareholders whoseprincipal currency is not the euro will be exposed to foreign currency exchange rate risk. Any depreciation of theeuro in relation to such foreign currency will reduce the value of such shareholders’ ordinary shares and anyappreciation of the euro will increase the value in foreign currency terms. In addition, we will not offer ourshareholders the option to elect to receive dividends, if any, in U.S. dollars. Consequently, our shareholders maybe required to arrange their own foreign currency exchange, either through a brokerage house or otherwise,which could incur additional commissions or expenses.

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We are subject to Dutch law and the rights of our ordinary shareholders may be different from those rightsassociated with companies governed by other laws.

As a result of being organized under the laws of the Netherlands, our corporate structure as well as the rightsand obligations of our ordinary shareholders may be different from the rights and obligations of shareholders incompanies incorporated in other jurisdictions. Resolutions of the general meeting of shareholders may be takenwith majorities different from the majorities required for adoption of equivalent resolutions in, for example,Maryland corporations.

Although shareholders will have the right to approve legal mergers or demergers, Dutch law does not grantappraisal rights to a company’s shareholders who wish to challenge the consideration to be paid upon a legalmerger or demerger of a company. In addition, if a third-party is liable to a Dutch company, under Dutch lawshareholders generally do not have the right to bring an action on behalf of the company or to bring an action ontheir own behalf to recover damages sustained as a result of a decrease in value, or loss of an increase in value, oftheir ordinary shares. Only in the event that the cause of liability of such third-party to the company alsoconstitutes a tortious act directly against such shareholder and the damages sustained are permanent, may thatshareholder have an individual right of action against such third-party on its own behalf to recover damages. TheDutch Civil Code provides for the possibility to initiate such actions collectively. A foundation or an associationwhose objective, as stated in its articles of association, is to protect the rights of persons having similar interestsmay institute a collective action. The collective action cannot result in an order for payment of monetarydamages but may result in a declaratory judgment (verklaring voor recht), for example declaring that a party hasacted wrongfully or has breached a fiduciary duty. The foundation or association and the defendant are permittedto reach (often on the basis of such declaratory judgment) a settlement which provides for monetarycompensation for damages. A designated Dutch court may declare the settlement agreement binding upon all theinjured parties with an opt-out choice for an individual injured party. An individual injured party, within theperiod set by the court, may also individually institute a civil claim for damages if such injured party is not boundby a collective agreement.

The provisions of Dutch corporate law have the effect of concentrating control over certain corporatedecisions and transactions in the hands of our board of directors. As a result, holders of our shares may havemore difficulty in protecting their interests in the face of actions by members of the board of directors than if wewere incorporated in the United States.

In the performance of its duties, our board of directors is required by Dutch law to consider the interests ofthe Company, our shareholders, our employees and other stakeholders in all cases with reasonableness andfairness. It is possible that some of these parties will have interests that are different from, or in addition to,interests of our shareholders.

In addition, Dutch law provides certain obligations on companies that are domiciled in the Netherlands andwhose shares are admitted to trading on a “regulated market,” as well as on certain shareholders of suchcompanies. NYSE Euronext Amsterdam qualifies as a regulated market and these laws will apply to us andcertain of our shareholders. Among other things, these laws may require shareholders to notify the AFM of theirholding of ordinary shares and changes to their holding if they increase or decrease their shareholding over orbelow 5% (a legislative proposal is expected to be adopted, which would introduce an initial threshold of 3%),10%, 15%, 20%, 25%, 30%, 40%, 50%, 60%, 75% and 95% of our ordinary shares and may require certainshareholders that acquire 30% or more of the voting rights attached to our ordinary shares, subject to certainexceptions, acting alone or in concert with others, to make a public offer for all of our ordinary shares. See“Articles of Association and Dutch Law” in Item 10B.

As a foreign private issuer listed solely on NYSE Euronext Amsterdam, we will rely on certain Dutchcorporate governance and disclosure practices rather than corresponding U.S. practices.

We are a foreign private issuer and are listed solely on NYSE Euronext Amsterdam. As a company based inthe Netherlands, we rely on Dutch corporate governance requirements rather than the corresponding

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requirements of U.S. exchanges for domestic issuers. We comply with each of the requirements of the DutchCorporate Governance Code (except for the best practice provision limiting remuneration in the case of dismissalto no more than one year’s salary and the best practice provision prescribing that the board of directors states thatthe internal risk management and control systems provide a reasonable assurance that the financial reporting doesnot contain any errors of material importance and that the risk management and control systems worked properlyin the year under review). Set forth below are the material Dutch corporate governance practices that we followand that differ from practices common among U.S.-listed issuers.

• Our Articles do not provide quorum requirements applicable to resolutions proposed to the generalmeeting of shareholders by the board of directors.

• Our general meeting of shareholders must adopt a general policy in respect of the remuneration of theboard of directors. In accordance with our Articles, the remuneration of our executive directors isdetermined by the board of directors upon the recommendation of our remuneration committee, withdue observance of the remuneration policy adopted by the general meeting of shareholders. Inaccordance with our Articles, the remuneration of our non-executive directors is determined by ourgeneral meeting of shareholders, with due observance of the remuneration policy.

• Under Dutch law, there is no regulatory regime for the solicitation of proxies and the solicitation ofproxies is not a generally accepted business practice in the Netherlands. We therefore do not intend tocomply with the rules and regulations under the Securities Exchange Act of 1934, as amended, whichwe refer to as the Exchange Act, related to the furnishing and content of proxy statements.

Accordingly, you may not have the same protections afforded to shareholders of companies that are notforeign private issuers.

You may be unable to enforce judgments obtained against us in U.S. courts.

We are incorporated under the laws of the Netherlands, and all or a substantial portion of our assets arelocated outside of the United States and certain of our directors and officers and certain other persons named inthis Report are, and will continue to be, non-residents of the United States. As a result, although we haveappointed an agent for service of process in the United States, it may be difficult or impossible for United Statesinvestors to effect service of process within the United States upon us or our non-U.S. resident directors andofficers or certain other persons named in this Annual Report or to enforce in the United States any judgmentagainst us or them including for civil liabilities under the United States securities laws. A judgment obtained inthe United States federal or state court against us or them may need to be enforced in the courts of theNetherlands, or such other foreign country as may have jurisdiction against us or them (or our/their assets). In thecase of the Netherlands, because there is no treaty on the reciprocal recognition and enforcement of judgments incivil and commercial matters between the United States and the Netherlands, courts in the Netherlands will notnecessarily recognize and enforce a final judgment rendered by a United States federal or state court, and in anycase will not automatically do so. For a United States judgment to be recognized and enforceable in theNetherlands, a judgment creditor must bring proceedings before a Dutch court of competent jurisdiction and seeka Dutch judgment recognizing and enforcing the liability of the relevant defendant/judgment debtor.Nevertheless, based on the current practice of the Dutch courts, it appears that a final money judgment renderedby a United States federal or state court after a substantive review of the merits (i.e., not by mere “defaultjudgment”) will be entitled to recognition by a Dutch court upon a showing that: (A) the final judgment resultedfrom legal proceedings compatible with Dutch notions of due process, (B) the final judgment did not contraveneany public policy of the Netherlands and (C) the United States federal or state court exercised personaljurisdiction over the relevant defendant/judgment debtor based on grounds that were internationally acceptable.Investors should not assume, however, that the courts of the Netherlands, or any other foreign jurisdiction, wouldenforce judgments of United States courts obtained against us or our directors and officers (or other personsnamed in this Annual Report) predicated solely upon the civil liability provisions of the United States securitieslaws or that such foreign courts would enforce, in original actions, liabilities against us or them predicated solelyupon such laws.

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Subject to the foregoing and service of process in accordance with applicable treaties, investors may be ableto enforce in the Netherlands judgments in civil and commercial matters obtained from U.S. federal or statecourts. We believe that U.S. investors may originate actions in a Dutch court. However, in such original actions,investors should not assume that a Dutch court would enforce liabilities predicated solely upon U.S. securitieslaws.

We have appointed Law Debenture Corporate Services Inc., located at 400 Madison Avenue 4 Floor NewYork, New York 10017, United States, as our agent to receive service of process with respect to any actionbrought against us in the United States District Court for the Southern District of New York under the federalsecurities laws of the United States or of any State of the United States or any action brought against us in theSupreme Court of the State of New York in the County of New York under the securities laws of the State ofNew York.

Failure to remain included in the AEX index may increase volatility in our share price, may reduce liquidityand may negatively impact our share price.

D.E MASTER BLENDERS has been included in Euronext Amsterdam’s main stock index, the AEX index,as of September 24, 2012. The AEX index is composed of the 25 most actively traded stocks on EuronextAmsterdam. Inclusion in the AEX index strengthens a company’s investment profile and increases its visibility inthe financial markets. Certain investors, such as some index-tracking investment funds, track the performance ofthe AEX index by directly or indirectly investing in all stocks of which it is constituted.

If we were no longer to be included in the index, this could increase the volatility of our shares. It could alsoreduce the liquidity of our shares on Euronext Amsterdam. As a result our removal from the index could have anegative effect on the price of our shares.

As of 2011, AEX index composition is reviewed four times a year—with a full “annual” review occurring inMarch and interim “quarterly” reviews occurring in June, September and December. Changes made to the AEXindex as a result of the reviews take effect on the third Friday of the month.

Association of Securities holders (Vereniging van Effectenbezitters) might undertake legal action.

The Association of Securities holders (Vereniging van Effectenbezitters, or VEB), a Dutch associationrepresenting interests of investors, has written to the Company in connection with the accounting irregularities inBrazil. In its letter, the VEB expresses the view that these accounting irregularities should have been disclosed inthe prospectus that was published at the time of the separation from Sara Lee. The VEB alleges that thenon-disclosure in the prospectus has harmed certain unnamed shareholders of the Company. The VEB states thatit does not exclude initiating litigation if it cannot reach an amicable arrangement with us on this issue. The VEBhas not specified the amount of damages that it is seeking from us. We disagree with the VEB. We believe theprospectus was prepared in accordance with the required standards of care and that we are not liable for anydamages caused. Interested parties other than the VEB, including regulatory authorities, may also decide toinitiate proceedings against us in connection with the accounting irregularities in Brazil. If proceedings arebrought against us, this may distract our management from running our business operations. If we were to lose acase brought against us, we could be made to indemnify shareholders for damages they incurred which mighthave a negative effect on the price of our stock.

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ITEM 4. INFORMATION ON THE COMPANY

4A History and development of D.E MASTER BLENDERS

General

D.E MASTER BLENDERS 1753 N.V. is a public limited liability company (naamloze vennootschap)incorporated in the Netherlands, with its corporate seat in Joure (Skasterlân), the Netherlands and with itsbusiness address at Oosterdoksstraat 80, 1011 DK Amsterdam, the Netherlands.

In January 2011, Sara Lee announced that its board of directors had agreed in principle to the separation ofSara Lee into two publicly traded companies. In connection with the separation, we became an independent,publicly traded company that holds, through our subsidiaries, the assets and liabilities associated with Sara Lee’sinternational coffee and tea businesses, which are headquartered in the Netherlands.

D.E MASTER BLENDERS B.V. was incorporated on February 27, 2012 as a private company with limitedliability (besloten vennootschap met beperkte aansprakelijkheid) by Sara Lee International B.V., a privatecompany with limited liability (besloten vennootschap met beperkte aansprakelijkheid). On April 4, 2012, wechanged our name to D.E MASTER BLENDERS 1753 B.V. and moved our corporate seat to Joure (Skasterlân),the Netherlands. On June 21, 2012, Sara Lee International B.V. changed our name to D.E MASTER BLENDERS1753 N.V., converted us into a public company with limited liability (naamloze vennootschap) incorporatedunder the laws of the Netherlands and amended our articles of association. Our shares are listed on NYSEEuronext in Amsterdam, which we refer to as NYSE Euronext Amsterdam, under the symbol “DE,” with theISIN Code NL0010157558 and the common code 078049103.

The separation from Sara Lee was comprised of the distribution and the merger, and certain relatedtransactions. These related transactions are described in the section of this Annual Report entitled“Separation-Related Financing” in Item 4A and include the issuance of the new Sara Lee notes, exchanges ofSara Lee debt (including the new Sara Lee notes) for DE US, Inc. debt securities, the entry into bridge financingby DE US, Inc. and DEMB International B.V., as well as the payment by DE US, Inc. of the DE US, Inc. SpecialDividend after the distribution and prior to the merger. These transactions were designed to facilitate theseparation in a manner that was efficient and that focuses on the long-term success of both the Company and SaraLee after the separation. We believe, and Sara Lee has informed us that it believes, that the separation-relatedfinancing transactions provide both the Company and Sara Lee with flexible capital structures, in terms of theirrespective operational and financial needs and risk profiles. Specifically, DE US, Inc.’s and DEMB InternationalB.V.’s entry into bridge financing and D.E MASTER BLENDERS’ entry into the revolving credit facility,together with the exchange of DE US, Inc. debt securities for certain Sara Lee debt, including the new Sara Leenotes, in the debt exchange are expected to provide us with a flexible capital structure comprised of short-termand long-term debt with which we will be more capable of responding to market conditions on a going forwardbasis.

The separation occurred through Sara Lee’s distribution to Sara Lee’s shareholders of all of the outstandingshares of DE US, Inc. common stock and the subsequent exchange in the merger of such shares for 100% of D.EMASTER BLENDERS’ ordinary shares outstanding immediately prior to the merger. In addition, DE US, Inc.declared a special cash dividend of $3.00 per share to each holder of record of DE US, Inc. common stockimmediately following the distribution that was paid after the distribution and prior to the merger. We referherein to this dividend as the DE US, Inc. Special Dividend. Each of the holders of Sara Lee common stock, whoare also the beneficial owners of DE US, Inc. common stock following the distribution, received one ordinaryshare of D.E MASTER BLENDERS in respect of each share of Sara Lee common stock held at the close ofbusiness on June 14, 2012, the record date for the distribution.

Our agent for service in the U.S. is Law Debenture Corporate Services Inc., 400 Madison Avenue, 4 Floor,New York, New York 10017.

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Our headquarters are located at:Oosterdoksstraat 801011 DK AmsterdamThe NetherlandsTelephone number: +31 20-558-1753Internet site: www.demasterblenders1753.com

Industry Overview

In the past decade, the coffee industry has seen growth from both the value and premium sectors as coffeeconsumption increased globally. Recently in developed countries, however, the primary growth in the coffeeindustry has come from the premium coffee category, including demand for single-serve coffee. We believe thatthis growth has been driven by the wider availability of high-quality coffee, the emergence of upscale coffeeshops throughout the world and the general level of consumer knowledge of, and appreciation for, coffee qualityand variety. According to J.P. Morgan Cazenove, single-serve coffee now accounts for approximately 25% of theroast and ground coffee market in Western Europe. In emerging market and coffee producing countries, coffeeconsumption has steadily increased over the past decade. P&A Marketing International, which we refer to asP&A, has predicted that by 2020, emerging market and coffee producing countries will account for more than50% of all coffee consumed globally. Of these countries, Brazil is currently the largest coffee consumer. Coffeeconsumption in Brazil has increased by approximately 45% in the past decade and the country now accounts forapproximately 60% of the Latin American coffee market, according to the Brazilian Coffee Industry Associationand J.P. Morgan Cazenove. P&A believes that approximately 85% of the coffee consumption increase betweennow and 2020 will come from Brazil and other coffee producing countries and emerging markets. Given thesetrends, we believe that, in order to successfully compete in the global coffee industry in the future, we must beable to capitalize on the growth in both the premium coffee market and in emerging market countries.

The global tea industry has also increased significantly in value over the past decade, but much of thegrowth has not come from new or developing tea markets. Rather, traditional tea drinking countries like Russiaand China continue to drive most of the growth in the tea industry, according to Euromonitor International Ltd.,which we refer to as Euromonitor. In Europe, we believe that growth in the tea industry will come frompremium, healthy teas. In order to continue to compete in the global tea industry, we must be able to offer highquality, premium tea in traditional flavors, as well as in newer concepts, formats and varieties that appeal toconsumers.

The most significant cost item in the production of coffee products is the price of green coffee beans, whichare purchased from tradehouses, cooperatives and farmers in various countries. Most coffee companies purchaseboth Arabica coffee beans and Robusta coffee beans for use in the blending and roasting processes to createdifferent types of coffee products. Brazil is the largest global producer of Arabica coffee, while Vietnam is theworld leader in Robusta production.

Purchasing green coffee is a complex undertaking that involves market research, maintaining close contactwith existing suppliers, identifying and selecting potential suppliers and coffee types required to produce blends,as well as negotiating and agreeing on purchase terms with suppliers. The price of green coffee is subject tofluctuations based upon speculation in the commodities markets, weather, seasonal fluctuations, real or perceivedshortages, pest or other crop damage, land usage, the political climate in the producing nations, competitivepressures, labor actions, currency fluctuations, armed conflict and government actions, including treaties andtrade controls by or between coffee producing nations. In addition, certain types of premium or sustainablecoffees sell at a premium to other green coffees due to the inability of producers to increase supply in the shortrun to meet rising demand. As consumers and certain customers become increasingly interested in purchasingsustainable or fair trade coffee, more coffee companies are seeking to purchase larger quantities of certifiedsustainable or fair trade green coffee. Because the supply of coffee certifiable as sustainable or fair trade islimited, the cost of acquiring such coffee may increase significantly in the future and coffee producers couldexperience difficulty producing adequate quantities to meet the increased demand.

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Fiscal 2011 saw a significant increase in the price of green coffee. In fiscal 2011, the price of green coffeeincreased by more than 50% over the prior year, reaching its highest level since 1997. After a downwardscorrection in fiscal 2012, we expect our average level of commodity costs to decline in fiscal 2013 compared tofiscal 2012, and prices are expected to remain volatile for the foreseeable future. To combat the substantial priceincreases in fiscal 2011, and the volatility in the green coffee commodities market generally, many coffeecompanies, including us, have employed certain hedging mechanisms, such as futures or options, to lock inprices for future deliveries of green coffee. In addition, we, along with many of our competitors, occasionallyraise prices to our retail customers to offset increases in our cost of goods. If commodity costs decline, we mayface pressure from our customers to decrease our prices.

In connection with the rising commodity prices over the past several years, our retail and Out of Homecustomers have exhibited price sensitivity. In our retail segments, where we sell our products to retail outlets, webelieve this has been a response to weakened consumer confidence as global economic conditions haveworsened. Consumer confidence levels remained weak in fiscal year 2012 and consumers are expected to remainprice-conscious in fiscal 2013. In the Out of Home segment, where the customer is typically a business, hospitalor hotel, we believe customer price sensitivity has been a result of efforts to reduce overhead costs. In somemarkets, price sensitivity has made it difficult to increase prices to cover increased green coffee costs.

Recent developments and capital expenditures and divestments

Please see the section of this Annual Report entitled “Separation from Sara Lee” under Item 5 for a detaileddescription of the steps comprising D.E MASTER BLENDERS spin-off from Sara Lee. Please see Notes 6, 7, 8and 13 of our financial statements for further information on capital expenditures and divestments.

Separation-Related Financing

On May 15, 2012, Sara Lee issued approximately $650 million principal amount of notes, which we refer toas the new Sara Lee notes, in a private placement. In connection with the contribution of Sara Lee’s internationalcoffee and tea businesses to DE US, Inc., Sara Lee received approximately $2.1 billion principal amount of DEUS, Inc. debt securities, which are guaranteed by D.E MASTER BLENDERS. In connection with the distributionand in accordance with the terms of the new Sara Lee notes, Sara Lee satisfied its obligations under the new SaraLee notes by transferring a portion of such DE US, Inc. debt securities to the holders of the new Sara Lee notes.Such DE US, Inc. debt securities were issued by DE US, Inc. and guaranteed by D.E MASTER BLENDERSpursuant to a note purchase and guarantee deed. Sara Lee transferred the remaining DE US, Inc. debt securities tocertain subsidiaries of DE US, Inc. in satisfaction of Sara Lee’s debt obligations to such subsidiaries of DE US,Inc. For more information regarding D.E MASTER BLENDERS guarantee of the DE US, Inc. debt securities,see the section of this Annual Report entitled “Description of Certain Indebtedness—Note Purchase andGuarantee Deed” under Item 10B.

On May 29, 2012, each of DE US, Inc. and our subsidiary, DEMB International B.V., entered into anagreement with third party lenders for approximately $1.8 billion of bridge financing, consisting of an initialbridge loan and a second bridge loan, each of approximately $1.8 billion. The initial bridge loan was repaidshortly after the distribution of the DE US, Inc. Special Cash Dividend with the proceeds of the second bridgeloan. The second bridge loan was repaid shortly after the separation with cash on hand at the time of theseparation. For further information regarding the bridge loans, see the section of this Annual Report entitled“Description of Certain Indebtedness—Bridge Financing” under Item 10B.

In connection with the separation, on May 22, 2012, D.E MASTER BLENDERS and DE US, Inc. enteredinto a revolving credit facility to provide available financing to D.E MASTER BLENDERS in future periods. Forfurther information regarding the revolving credit facility, see the section of this Annual Report entitled“Description of Certain Indebtedness—Revolving Credit Facility Agreement” under Item 10B.

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As a consequence of various transactions, including those described above, between us and Sara Lee inconnection with the separation, our borrowings have increased to approximately €557 million and our cash andcash equivalents have decreased to approximately €220 million.

Treatment of Equity-Based Compensation in Separation

Prior to the separation, Sara Lee, D.E MASTER BLENDERS and D.E US Inc. entered into an employeematters agreement (the “Employee Matters Agreement”) describing the treatment of Sara Lee equity awards heldby employees who are now employed by D.E US Inc. and by the Company, or who are former employees of theD.E US Inc. business but who held equity awards at the time of the distribution, which we collectively refer to asD.E MASTER BLENDERS Employees, and by non-employee directors who serve on the board of directors ofthe Company. For purposes of this discussion, “Sara Lee RSUs” refers to Sara Lee restricted stock units and“Sara Lee PSUs” refers to Sara Lee performance share units. Below we describe the treatment of Sara Lee stockthat is converted into D.E MASTER BLENDERS stock.

For the actual number of D.E MASTER BLENDERS stock held by directors and senior management afterconversion, reference is made to “Item 6—Directors, Senior Management and Employees”.

Adjustment of Sara Lee Equity Awards

Sara Lee RSUs and Sara Lee PSUs outstanding immediately prior to June 28, 2012 the distribution datewere adjusted to account for the distribution and the CoffeeCo (i.e. DE US Inc.) Special Dividend.

Sara Lee RSUs

With respect to Sara Lee RSUs granted on January 26, 2012 to our Non-Executive Chairman in his role asExecutive Chairman of the board of directors of Sara Lee, which we refer to as the Chairman 2012 RSUs,one-half of such Chairman 2012 RSUs vested on the distribution date. The remaining one-half of the Chairman2012 RSUs were cancelled. The Chairman 2012 RSUs that vested, settled for a number of D.E MASTERBLENDERS ordinary shares determined by multiplying the number of shares of Sara Lee common stock subjectto such vested Chairman 2012 RSUs by the D.E MASTER BLENDERS Ratio, and rounding down to the nearestwhole share. “D.E MASTER BLENDERS Ratio” is a fraction, the numerator of which is the volume weightedaverage price of shares of Sara Lee common stock trading the regular way on the New York Stock Exchange onJune 27 and 28, 2012 and the denominator of which is the volume weighted average price of the D.E MASTERBLENDERS ordinary shares trading in the as-if-and-when issued market on NYSE Euronext Amsterdam onJune 29, 2012 and July 2, 2012 (as converted into U.S. dollars in accordance with the currency exchange ratepublished by the Federal Reserve Bank of New York for the distribution date).

Sara Lee RSUs granted on January 26, 2012 to our Chief Executive Officer in his role as Executive VicePresident and Chief Executive Officer of Sara Lee’s Coffee and Tea (formerly International Beverage) segmentvested in full on the distribution date and were settled for a number of D.E MASTER BLENDERS ordinaryshares determined by multiplying the number of shares of Sara Lee common stock subject to RSUs by the D.EMASTER BLENDERS Ratio, and rounding down to the nearest whole share.

Sara Lee PSUs

With respect to Sara Lee PSUs granted on or following November 4, 2011 (other than the Chairman 2012PSUs, as described below), and held immediately prior to the distribution by employees who became D.EMASTER BLENDERS Employees on the consummation of the merger, such Sara Lee PSUs were earned asfollows, which we refer to as the “Earned PSUs”: the achievement of the performance goals were determined asof the distribution date based on actual performance through the distribution date with respect to the portion ofthe fiscal year 2012 that had occurred prior to the distribution date and based on target-level performance withrespect to the portion of the fiscal year that had not yet occurred as of the distribution date.

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Upon consummation of the merger, the Earned PSUs were assumed by D.E MASTER BLENDERS andconverted into a number of PSUs denominated in ordinary shares of the Company, the number of which wasdetermined by multiplying the number of shares of Sara Lee common stock subject to the Sara Lee PSUimmediately prior to the distribution by the D.E MASTER BLENDERS Ratio.

Sara Lee PSUs granted on January 26, 2012 to our Non-Executive Chairman in his role as ExecutiveChairman of the board of directors of Sara Lee, which we refer to as the Chairman 2012 PSUs, were earned asfollows: the achievement of the performance goals were determined as of the distribution date based on actualperformance through the distribution date with respect to the portion of Sara Lee’s fiscal year 2012 that hadoccurred prior to the distribution date and based on target-level performance with respect to the portion of SaraLee’s fiscal year 2012 that had not yet occurred as of the distribution date. One-half of the Chairman 2012 PSUsthat were earned pursuant to the previous sentence vested on the distribution date. The remaining one-half of theChairman 2012 PSUs were cancelled. The Chairman 2012 PSUs that vested pursuant to the foregoing settled fora number of D.E MASTER BLENDERS ordinary shares determined by multiplying the number of shares of SaraLee common stock subject to such vested Chairman 2012 PSUs by the D.E MASTER BLENDERS Ratio, androunding down to the nearest whole share.

RSUs Held by Non-Employee Directors

Each non-employee director of Sara Lee who serves as a non-employee director of D.E MASTERBLENDERS and who held a Sara Lee RSU immediately prior to the distribution, continues to hold such Sara LeeRSU and was also granted a new RSU award denominated in ordinary shares of the Company, which we refer toas a D.E MASTER BLENDERS RSU, with the number of D.E MASTER BLENDERS shares subject to suchD.E MASTER BLENDERS RSU determined by multiplying the number of Sara Lee shares subject to the SaraLee RSU immediately prior to the distribution by a fraction, the numerator of which is the difference between thevolume weighted average price of the Sara Lee shares trading the regular way on the New York Stock Exchangeover June 27 and 28, 2012 and the volume weighted average price of shares of Sara Lee common stock on theNew York Stock Exchange over June 29, 2012 and July 2, 2012 and the denominator of which is the volumeweighted average price of the D.E MASTER BLENDERS ordinary shares trading in the as-if-and-when issuedmarket on NYSE Euronext Amsterdam over June 29, 2012 and July 2, 2012 (as converted into U.S. dollars inaccordance with the currency exchange rate published by the Federal Reserve Bank of New York for thedistribution date).

Each Sara Lee RSU and D.E MASTER BLENDERS RSU held by a non-employee director who serves onthe D.E MASTER BLENDERS board of directors after the distribution and consummation of the merger settledfor shares of Sara Lee and the Company, respectively, on the date that is six months following the distributiondate.

Material U.S. Federal Income Tax Consequences Relating to Section 7874 of the Code

For U.S. federal income tax purposes, a corporation generally is considered tax resident in the place of itsincorporation. Because D.E MASTER BLENDERS is incorporated under Dutch law, it should be deemed aDutch corporation under this general rule. However, Section 7874 of the Code generally provides that acorporation incorporated outside the United States that acquires substantially all of the assets of a corporationincorporated in the United States will be treated as a U.S. corporation (and, therefore, a U.S. tax resident) forU.S. federal income tax purposes if shareholders of the acquired U.S. corporation own at least 80 percent (ofeither the voting power or the value) of the stock of the acquiring foreign corporation group after the acquisitionand the acquiring foreign corporation’s “expanded affiliated group” does not have “substantial businessactivities” in the country in which the acquiring foreign corporation is organized. Pursuant to the merger, D.EMASTER BLENDERS acquired all of DE US, Inc.’s assets, and DE US, Inc. shareholders hold 100 percent ofD.E MASTER BLENDERS by virtue of their stock ownership of DE US, Inc. D.E MASTER BLENDERSshould be treated as a foreign corporation for U.S. federal income tax purposes under Section 7874 of the Code

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provided that the D.E MASTER BLENDERS group has substantial business activities in the Netherlands. Underthe rules applicable to D.E MASTER BLENDERS, at the time of the merger, there was no specific guidance asto what constitutes “substantial business activities.” Based on the historical conduct of the coffee and teabusiness in the Netherlands, the relative amount of assets, employees and sales located in the Netherlands, thesubstantial managerial activities by officers and employees in the Netherlands, and the Dutch business activitiesthat are material to the Group’s overall business activities, in each case at the time of the merger, D.E MASTERBLENDERS believes that its expanded affiliated group should have substantial business activities in theNetherlands. As a result, D.E MASTER BLENDERS should not be treated as a U.S. corporation for U.S. federalincome tax purposes under Section 7874 of the Code following the merger, and the Company obtained anopinion of counsel to that effect. Nevertheless, it is possible that the IRS would interpret Section 7874 of theCode to treat D.E MASTER BLENDERS as a U.S. corporation after the merger. Moreover, the U.S. Congress orthe IRS and Treasury Department may enact new statutory or regulatory provisions that could adversely affectD.E MASTER BLENDERS’ status as a foreign corporation. Retroactive statutory or regulatory actions haveoccurred in the past, and there can be no assurance that any such provisions, if enacted or promulgated, wouldnot have retroactive application to D.E MASTER BLENDERS.

If it were determined that D.E MASTER BLENDERS is properly treated as a U.S. corporation forU.S. federal income tax purposes, D.E MASTER BLENDERS could be liable for substantial additional U.S.federal income tax. For Dutch corporate income tax and dividend withholding tax purposes, D.E MASTERBLENDERS will, regardless of any application of Section 7874 of the Code, be treated as a Dutch residentcompany since D.E MASTER BLENDERS is incorporated under Dutch law. The Tax Convention concludedbetween the Netherlands and the United States will not fully limit the ability of the Netherlands to levy suchtaxes. Consequently, the Company might be liable for both Dutch and U.S. taxes, which would have a materialadverse effect on our financial condition and results of operations.

Additionally, D.E MASTER BLENDERS shareholders could face certain adverse tax consequences if itwere determined that the Company were properly treated as a U.S. corporation for U.S. federal income tax. Withrespect to U.S. Holders, the U.S. consequences of owning and disposing of shares of D.E MASTER BLENDERSgenerally would be the same as those of owning and disposing of shares of a foreign corporation as described in“Taxation—Taxation in the United States” in Item 10E. However, U.S. Holders generally would not be able toclaim a U.S. foreign tax credit with respect to any Dutch taxes withheld by the Company on distributions, unlessthe U.S. Holder had other foreign source income. With respect to shareholders that are not U.S. Holders, becausethe Company would continue to be treated as a Dutch corporation for Dutch withholding tax purposes, suchshareholders could be subject to dividend withholding under both U.S. and Dutch law absent an applicableexemption.

Please see the section of this Annual Report entitled “Selected Financial Data” for the amount of D.EMASTER BLENDERS capital expenditures and divestitures for the last three fiscal years.

Property, plant and equipment

The total capital expenditures in property, plant and equipment amount to €97 million, €78 million and€66 million for fiscal years 2012, 2011 and 2010, respectively, and relate mainly to investments in machineryand equipment of €43 million, €37 million and €31 million in fiscal years 2012, 2011 and 2010, respectively, andconstruction in progress of €52 million, €39 million and €32 million in fiscal years 2012, 2011 and 2010,respectively.

Total disposals, including impairment, amount to €18 million, €15 million and €16 million in fiscal years2012, 2011 and 2010, respectively.

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Intangible fixed assets

The total capital expenditures in intangible assets amount to €135 million, €8 million and €4 million infiscal years 2012, 2011 and 2010, respectively. In March 2012 the Group entered into agreements to pay €115million to Philips Electronics, which we refer to as Philips, to acquire its ownership interest in the Senseo coffeetrademark. This acquisition provided the Group with full ownership of the Senseo trademark, which waspreviously co-owned with Philips.

Total disposals, including impairment, are €13 million, €2 million and €1 million in fiscal years 2012, 2011and 2010, respectively.

Acquisitions during the fiscal year 2012

In December 2011, the Group acquired CoffeeCompany, a leading Dutch café store operator in theNetherlands; Tea Forte, a producer of ultra premium teas that are principally sold in the United States andCanada, and the Denmark operations of House of Coffee, a leading out of home provider of coffee and teaproducts in Norway and Denmark. In April 2012 the Group acquired Expresso Coffee Automacao de BebidasQuentes Ltda, an out of home provider that offers its customers a full service concept (machines, coffee andservice) mainly in the Sao Paulo area. The total consideration for these acquisitions was €23.4 million, includinga perfomance-based contingent purchase price payment of €1 million, which was recognised as a liability. As ofJune 2012, the Group has estimated the contingent payment to be €1 million. As a result of the transactions,goodwill and other intangible assets of €25 million were recognised.

Divestments during the fiscal year 2012

There have been no divestments during the fiscal year 2012.

As of the date of this Annual Report, there has been no indication of any public takeover offer by any thirdparty in respect of our ordinary shares, or by us in respect of other companies’ shares.

4B Business overview

General

We are a leading, focused pure-play coffee and tea company that offers an extensive range of high-quality,innovative coffee and tea products that are well-known in retail and out of home markets across Europe, Brazil,Australia and Thailand. According to Euromonitor, the global coffee and tea industry had aggregate revenues ofapproximately €78.3 billion in calendar year 2011. We are one of the largest companies (based on revenues)operating purely in the coffee and tea industry.

Our History

The roots of our Company go back to 1753 in Joure, the Netherlands, when the Douwe Egberts brand wasfounded as a grocery business and grew to specialize in coffee and tea. In 1948, Douwe Egberts expanded itsbusiness and began exporting its products to other European countries. Sara Lee acquired the Douwe Egbertsbusiness through a series of investments beginning in 1978. As part of Sara Lee, the Company expanded itsgeographic reach and increased its focus on innovation. In 1998, the Company entered the Brazilian coffeemarket through a series of acquisitions, most recently Café Moka in 2008 and Café Damasco in 2010. We startedto aggressively grow the Cafitesse proprietary liquid coffee systems for the foodservice industry in the 1990s andintroduced the Senseo single-serve coffee system in partnership with Philips in 2001. In 2010, the Companylaunched the L’OR EspressO capsules compatible with the Nespresso® single-serve system.

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Our Brands

We have a portfolio of leading coffee and tea brands that address the needs of both our retail and out ofhome customers in our markets. According to AC Nielsen, as of December 31, 2011, we held the top marketposition in the Netherlands, Brazil, Belgium, Denmark and Hungary, the number two position in France,Australia and Spain, based on the total retail coffee market, including multi-serve, single-serve and instant. Infiscal 2012, approximately 72% of our total sales were derived from markets where we held the number one ortwo market position. Each of our brands has a particular consumer or regional positioning that distinguishes itfrom its competitors and guides advertising and new product development.

Douwe Egberts is our largest and most established brand in the multi-serve category. With more than 250years of experience in the coffee and tea industry, Douwe Egberts is the best-selling coffee brand in theNetherlands and Belgium and also has solid market positions in the United Kingdom and Hungary. In addition toDouwe Egberts, our multi-serve coffee is sold under the following brands: L’OR and Maison du Café in France,Marcilla in Spain, Merrild in Denmark, Harris in Australia, Kanis & Gunnink in the Netherlands, Jacqmotte inBelgium, Prima in Poland, and Pilão, Caboclo, Damasco and Moka in Brazil. Our single-serve coffee is soldunder the brand name Senseo which is generally co-branded, such as Douwe Egberts Senseo and L’OR Senseo, inthe Netherlands, Belgium, France, Germany, Spain and select other countries. In April 2010, we launched theL’OR EspressO capsules brand in France, and L’OR EspressO has subsequently been successfully launched inthe Netherlands and Belgium. In May 2011, we successfully launched our capsules brand in Spain as L’aRômeEspressO. Our instant coffee is primarily sold under the Moccona brand in Australia and Thailand, under theDouwe Egberts brand in the United Kingdom and under local brands in certain of our markets. Our tea is soldunder the brand names Pickwick in the Netherlands, Belgium, the Czech Republic, Hungary and Denmark andHornimans in Spain. Our Out of Home segment primarily operates under the Cafitesse umbrella brand, which isprincipally co-branded Douwe Egberts Cafitesse, for our liquid roast coffee products and machines and under ourPiazza D’Oro brand for premium espresso products and machines.

Our Competitive Strengths

Pure-Play Coffee and Tea Company. We are one of the largest companies (based on revenues) operatingpurely in the coffee and tea industry. We believe that our focus on the coffee and tea business enables us tointroduce innovative new products and concepts tailored to the preferences of our consumers and customers. Webelieve that our scale and diversity of operations in key markets provides us with greater marketing resources,production efficiencies and purchasing expertise, broader research and development capabilities and deeperconsumer knowledge and understanding than our smaller regional and local competitors. Further, we expect thatour streamlined organization will optimize time-to-market of new product innovations.

Strong Brands with Leading Market Positions. Our brands have a strong heritage in the coffee and teaindustry, and we possess a portfolio of well-known and trusted brands with leading positions in key markets.According to AC Nielsen, our coffee brands occupy the number one retail market position in the Netherlands,Brazil, Belgium, Hungary and Denmark, the number two position in France and Australia and the number threeposition in Spain, based on total retail coffee market revenues, including multi-serve, single-serve and instant.Our Douwe Egberts brand is the number one coffee brand in the Netherlands and Belgium. Pilão enjoys thenumber one position in Brazil and Merrild is the leading coffee brand in Denmark. The Senseo brand ofsingle-serve coffee pads and our L’OR EspressO and L’aRôme EspressO single-serve capsules are recognized byconsumers for quality, and we continue to expand our single-serve offerings into new markets. In the teacategory, Pickwick is a well-known brand in the Netherlands, the Czech Republic, Hungary and Denmark andHornimans currently enjoys a strong market position in Spain. Further, in our Out of Home segment, we believebased on our internal estimates and analysis that we hold the number one or two market position in six countries.The strength of our brands in these markets allows us to test and introduce new products quickly, furtherimproving our ability to adapt to industry trends and changing consumer preferences.

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Knowledge and Innovation. Our business model is centered around our deep consumer knowledge andunderstanding, our technology and our strong innovation capabilities. Based on the unique consumer andcustomer insights we have gained over numerous decades, we have a deep understanding of the coffee and teacategory and the preferences of its consumers and customers. This, coupled with our strong research anddevelopment capabilities, has positioned us well to launch new products and concepts that reflect the preferencesof our consumers and customers. In 2001, for instance, we introduced the Senseo single-serve coffee system inpartnership with Philips. Our launch in April 2010 of L’OR EspressO capsules compatible with the Nespresso®

single-serve system marked our entry into the single-serve espresso category. We intend to increase our presencewith further innovations in this category in the coming years. In the Out of Home segment, we have built superiorknowledge, expertise and capabilities in the liquid roast category, creating an easy-to-use premium coffeeexperience with our Cafitesse liquid roast products and systems.

Strong Management Team. Our company has a centuries-long rich tradition in the coffee and tea industry andover the course of our long history, our organization has developed superior coffee expertise. We believe this givesus a competitive advantage throughout the entire coffee value chain and in particular in coffee blending, coffee andtea sourcing and developing technological innovations that will enhance the coffee experience for our consumers. Inconnection with our separation from Sara Lee, we have hired new management with experience outside the coffeeand tea industry who have extensive experience expanding businesses in existing consumer markets and into newconsumer markets. These individuals bring a strong track record of managerial and marketing capabilities to theCompany. We believe that the combination of our coffee and tea industry experience and employee expertise withour growth driven management will be a powerful combination for the Company.

Key Business Strategies

Our aspiration is to be a leading, international coffee and tea company by enhancing the coffee and teaexperience of our consumers through innovative products, concepts and systems that are based on our in-depthconsumer knowledge and technology expertise, with a focus on the premium coffee and tea sectors. We intend toleverage our category and consumer expertise and knowledge across borders while tailoring our high-qualityproduct offering to local preferences.

Enhance our Marketing Efforts. Our marketing strategy is to create added value by translating customerand consumer insights into effective innovations and brand visions. We are implementing a new innovationstrategy designed to address consumer needs identified through preference mapping and other research. Weintend to combine these insights with our rich heritage and expertise in the coffee and tea industry to creatememorable coffee and tea experiences for our consumers and to strengthen our relationships with our customers.We plan to use the strength and consumer awareness of our key brands to allow us to introduce our innovationsinto the market quickly.

Our Out of Home segment plays an important role in building brand presence. To date, this has been animportant but secondary role of the segment. Going forward, we expect that our Out of Home segment will playan increasing role in brand building by targeting select customers with broad consumer visibility, for example atcafés, gas stations and airports.

We also plan to increase our focus on digital and new media, which we believe will allow us to interactmore effectively with our consumers in each of our markets. For example, the launch of the L’OR EspressOproduct line involved a mix of traditional print and television advertising campaigns, as well as digital mediaadvertising, and our L’OR EspressO sales increased in the fiscal quarter in which these campaigns launched. Wealso seek to increase brand and product awareness by placing our products in as many customer channels aspossible. Additionally, we currently have a successful loyalty building program in the Netherlands, which we arein the process of modernizing. We plan to build on that success to continue to improve our connection with ourconsumers in all of our markets.

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Revitalize Product Lines to Enhance the Coffee and Tea Experience. We intend to renew our product linein 24 months, with the majority of such innovations expected to come to market in the second half of fiscal 2013,as described below:

Re-Invent Multi-Serve. We see multi-serve as an opportunity to refresh a category that has been stable for along period of time. We intend to engage new and existing consumers with a differentiated product line presentedin a contemporary fashion. We expect that this will include a broader product range, new premium offerings andnew packaging concepts that address diverse consumer preferences.

Revitalize Pads. Philips and Sara Lee were pioneers in expanding the single-serve category. With over33 million Senseo machines sold as of February 1, 2012, the market position of our coffee pads provides us witha solid foundation in this category. Our retail sales of coffee pads increased by 20% between fiscal 2008 andfiscal 2012, and we had €434 million in sales of coffee pads in fiscal 2012, with approximately 95% of such salesfrom the Netherlands, Belgium, France and Germany. Going forward, we intend to pursue geographic expansionand machine and coffee pad innovations and we intend to address a broader range of consumer segments, withmore varied and contemporary product offerings. To this end, on March 30, 2012 we entered into a partnershipagreement and a trademark transfer agreement with Philips to strengthen our relationship with Philips andacquire the full rights to the Senseo trademark. In the future, we intend to use Senseo as our new master brand forany future high-tech product offerings and we expect to launch a new Senseo machine annually.

Differentiate Capsules. Our L’OR EspressO and L’aRôme EspressO capsules have experienced significantsuccess and sales growth since the launch of L’OR EspressO in France in April 2010, with revenues from suchsales exceeding €110 million in fiscal 2012. We intend to expand our capsule sales by establishing moredifferentiated brand positioning and extending our range to better address varied consumer preferences.

Build on Leading Position in Out of Home and Focus on Synergies with Retail. Through our proprietaryliquid roast coffee technology and our Cafitesse brand, we lead the liquid roast category for out of homeconsumption (based on internal estimates and analysis). We intend to expand our liquid roast coffee businessand, to further this goal, we are developing new, premium liquid roast products. We also intend to broaden ourbusiness base to include many of the more visible customer segments where roast and ground and espressoproducts are key to success. To this end, we recently acquired CoffeeCompany, a dynamic café operator targetingyoung urban consumers in the Netherlands. Our intent is to gain inspiration and consumer connectionexperiences with the goal of expanding the visibility of, and becoming more effective in showcasing, our retailbrands. We also intend to use the cafés as a test market to test new products and concepts before a full-scalelaunch. However, we do not intend to become a global café operator.

Expand our Presence in Instants into Existing Markets. We have a strong market position in premiumfreeze-dried instant coffee in Australia with the Moccona brand and have been gaining instant coffee marketshare in the United Kingdom with the Douwe Egberts brand. We plan to build on our instant coffee expertisethrough further innovations and increased marketing in countries where we already have strong multi-servefootholds.

Reinvigorate Tea. We believe that we have a strong platform from which to expand in the tea category withour Pickwick brand, which is well-known in the Netherlands, Hungary, Denmark and the Czech Republic, ourHornimans brand, which is a leader in Spain, and our recently acquired Tea Forte brand, a premium tea brandprincipally sold in the United States and Canada. We intend to expand our presence in the tea market throughinnovative new concepts and a sustained marketing effort designed to create more premium positioning for ourtea activities.

Expand Geographically. As a part of Sara Lee, we historically derived a large percentage of our sales andprofits from Western Europe. As an independent company, we intend to pursue growth in our Western Europeanmarkets, including the Netherlands, France, Spain, Belgium and Denmark, through effective marketing,

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innovation and increased penetration of our products in these markets. We also intend to pursue growth in theemerging markets in which we currently operate, including Brazil, Eastern Europe and Thailand, and expansioninto new markets through extensions of our own product innovations and through selective acquisitions, whereappropriate and with a high level of discipline. Additionally, we believe that our Senseo single-serve coffeesystem and our L’OR EspressO capsules, already well-known in their existing markets, can contribute to ourexpansion into new markets. We are in the process of developing new products for both Senseo and L’OREspressO to further increase consumer interest and bring our products into more households in both our existingand new markets.

Our Segments

Our business is currently organized into three operating segments, Retail—Western Europe, Retail—Rest ofWorld and Out of Home. The following table sets forth our total sales and the percentage of our sales attributableto each of our operating segments for fiscal years 2012, 2011 and 2010:

2012 2011 2010

Total Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €2.8 billion €2.6 billion €2.3 billionRetail—Western Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45% 43% 46%Retail—Rest of World . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27% 25% 25%Out of Home . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23% 24% 27%Unallocated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5% 8% 2%

Within our Retail—Western Europe and our Retail—Rest of World segments, our principal products aremulti-serve coffee, single-serve coffee pads and capsules, instant coffee and tea. We sell these productspredominantly to supermarkets, hypermarkets and through international buying groups. In our Out of Homesegment, we offer a full range of hot beverage products but focus on our liquid roast products and related coffeemachines. Our products and the related machines in the Out of Home segment are sold either directly tobusinesses, hotels, hospitals and restaurants or to foodservice distributors for distribution to the customer.

Retail—Western Europe

In our Retail—Western Europe segment, we have been active in four categories: multi-serve, single-serve,instant and tea, for the past three fiscal years. In addition, the cafés we operate in the Netherlands following ouracquisition of CoffeeCompany report through our Retail—Western Europe segment. Our multi-serve coffee isprincipally sold under the following brands: Douwe Egberts in the Netherlands, Belgium and the UnitedKingdom, L’OR and Maison du Café in France, Marcilla in Spain, Merrild in Denmark, Kanis & Gunnink in theNetherlands and Jacqmotte in Belgium. Our single-serve coffee is principally sold under the brand names Senseowhich is generally co-branded, such as Douwe Egberts Senseo and Maison du Café Senseo, in the Netherlands,Belgium, France, Germany, Spain and select other countries, L’OR EspressO in France, the Netherlands andBelgium and L’aRôme EspressO in Spain. Our instant coffee is sold under the Douwe Egberts brand in UnitedKingdom and under local brands in certain of our Western European markets. Our tea is sold under the brandnames Pickwick in the Netherlands, Belgium and Denmark and Hornimans in Spain. Retail—Western Europecovers the following countries: the Netherlands, Belgium, France, Denmark, Greece, Germany, the UnitedKingdom and Spain.

Retail—Rest of World

In our Retail—Rest of World segment, we have also been active in four categories: multi-serve, single-serve, instant and tea, for the past three fiscal years. Our multi-serve coffee is principally sold under thefollowing brands: Pilão, Caboclo, Damasco and Moka in Brazil, Harris in Australia and Prima in Poland. Oursingle-serve coffee is sold in Brazil under the Senseo brand name, co-branded as Pilão Senseo. Our instant coffeeis primarily sold under the Moccona brand in Australia and Thailand. Our tea is sold under the brand name

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Pickwick in the Czech Republic and Hungary. Retail—Rest of World covers the following countries: Brazil,Hungary, the Czech Republic, Poland, Australia, Thailand and Russia.

Out of Home

For the past three fiscal years, our Out of Home segment has been concentrated in the Netherlands and hasprovided liquid roast coffee products and the machines that dispense these products, as well as multi-servecoffee, instant coffee and tea and related products, to businesses, hospitals, hotels and restaurants worldwide.Approximately half of our Out of Home sales are made directly to such customers, while we also work withdistributors who distribute our products to the customer in certain markets. Through our Cafitesse umbrellabrand, we offer a line of products to be used in the liquid roast machines that we sell, lease or provide free ofcharge to our customers. Additionally, through our Piazza D’Oro brand we offer premium espresso coffeeproducts and machines. We develop the proprietary coffee machines in house and employ suppliers to producethe machines. We also employ service technicians in most of our major markets who we train to service ourmachines in the field. According to Euromonitor, in 2011, we were the largest supplier by volume of coffee forthe out of home market in the Netherlands, Denmark and Belgium. Based on internal estimates and analysis, weestimate that we serve approximately 80% of the worldwide liquid roast market, based on number of cupsconsumed. As of June 30, 2012 we operated over 248,000 machines in businesses, hospitals, hotels andrestaurants in our markets of which more than 60% are Cafitesse liquid roast machines. On October 24, 2011,Sara Lee entered into an asset purchase agreement with the J.M. Smucker Company, which we refer to asSmucker’s, in connection with its sale to Smucker’s of its liquid coffee business in the United States, Canada,Mexico, and most of the Caribbean. Under the terms of this agreement, we agreed not to engage in the businessof manufacturing, marketing, selling or distributing liquid coffee concentrate products in the out of home channelin such territories for ten years.

Research and Product Development

Our research and development teams are responsible for the technical development of our coffee and teaproducts, packaging systems and new equipment and manufacturing methods. The research and developmentdepartment works with the legal team to protect our innovations through patents and trademarks, where possible,and to ensure compliance with applicable regulations. Our teams adapt technological innovations to existingproduct lines and new product introductions. We strive for innovation across all product categories and devotesignificant resources to each segment.

In our Out of Home segment, we are the leader in liquid roast technology. We develop and produce ourproprietary liquid roast coffee products and the technology for our proprietary liquid roast coffee machinesin-house. We are constantly innovating in this category and previously announced that we have developedambient liquid roast coffee that will allow our customers to store this coffee prior to use at room temperature,eliminating the need for frozen storage. This new product was released in the Netherlands and Germany in fiscal2012. We are also working to upgrade our liquid roast quality to match the taste of espresso.

Our research and development product teams also work closely with our marketing, supply chain andprocurement teams in identifying trends, developing new products and modifying existing products for all of ourproduct lines, enabling us to quickly and efficiently respond to changing consumer needs. The research anddevelopment department is also integral to the launch of new products where they work with marketing to ensurea smooth product launch. An example of this collaboration was the development and launch of the L’OREspressO product line in France in April 2010, which consists of proprietary L’OR EspressO capsulescompatible with the Nespresso® single-serve system. Our multidisciplinary development approach has led toproprietary capsule technology which, together with innovative manufacturing technology, is the basis for ourhigh quality L’OR EspressO and L’aRôme EspressO products. Less than two years after its inception, the L’OREspressO and L’aRôme EspressO product line now consists of more than fifteen different product variants, withaggregate revenues from sales of these products exceeding €110 million in fiscal 2012 in France, the

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Netherlands, Belgium and Spain. Further research and development has also resulted in the addition of variousEspresso and Lungo ranges to our capsule product lines.

Additionally, we conduct research and development with partners in certain ventures. Our most significantdevelopment partner is Philips. We continue to collaborate with Philips on innovations to the Senseo single-servecoffee system product line, including the ongoing development of new Senseo machine designs to appeal to arange of customer tastes. On March 30, 2012, we entered into a new partnership agreement with Philips pursuantto which Philips will be our exclusive partner for the commercialization of coffee systems in the consumer field,including those to be developed under the Senseo trademark. We also collaborate on a limited basis with certainnational and international coffee trade associations in an effort to promote the beneficial effects of coffeeconsumption and support external research by universities to study these effects.

At the core of our research and development capabilities is a team of approximately 125 people. Ourresearch and development facilities are located in Utrecht, the Netherlands.

Spending on research and development for fiscal 2012, 2011 and 2010 was approximately €25 million,€21 million and €18 million, respectively. On average, approximately one-third of our research and developmentbudget is devoted to single-serve product development, one-third to liquid roast and approximately one-third isdevoted to all other categories. In addition to our investments in traditional research and development activitiesand in developing new manufacturing processes, we actively invest in our manufacturing facilities.

Marketing

Our global marketing team is organized around six categories: multi-serve, single-serve pads, portionedespresso capsules, instant, liquid roast coffee and tea. In our retail segments, our national marketing teams workclosely with our global team and our research and development team to ensure that we present a consistentmessage for each brand that effectively conveys the attributes of our brands. The national marketing personnelthen work closely with their key retail channel entities on product plans, placement and initiatives, marketingprograms and other product sales support. In the tea category, our marketing team both works directly with ourretail customers to design and implement in-store promotional activities and uses television commercials andprint and internet advertisements to target specific audiences. In our Out of Home segment, our goal is tounderstand the customers’ needs and build a tailored proposition specifically for each customer. For example, fora hotel customer we could offer a liquid coffee system for their high volume conference needs, as well as instant,multi-serve or single-serve coffee for their in-room needs. Our goal is to synergize our marketing and salesdepartments in both retail and Out of Home to create a clear message in each of our categories and to emphasizeour premium products and brands.

Customers

In fiscal 2012, approximately 65% of our sales were derived from Western Europe, 21% from SouthAmerica, 6% from Central and Eastern Europe and 8% from Asia/Pacific. In fiscal 2012, approximately 45% ofour sales came from our Retail—Western Europe segment, approximately 27% of our sales came from ourRetail—Rest of World segment and approximately 23% of our sales came from our Out of Home segment. In ourretail segments we sell directly to food and beverage retailers as well as to wholesalers. In our Out of Homesegment we sell directly to businesses, hospitals, hotels and restaurants as well as to third party distributors whodistribute our products to customers in certain markets. In fiscal 2012, approximately, 46% of our sales werederived from multi-serve coffee products, 20% from sales of single-serve coffee products, 7% from sales ofliquid roast coffee products, 9% from sales of instant coffee, 5% from sales of tea and 13% from sales of othercoffee and tea related products.

In our retail segments, our largest customers are large supermarket retailers and international buying groups,which are composed of regional supermarket retailers that join together to increase their purchasing leverage. In

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our Retail—Western Europe segment, our three largest customers are Carrefour, Coopernic (an internationalbuying group) and EMD (an international buying group), which represented an aggregate of approximately 16%of the Company’s sales in fiscal 2012. In our Retail—Rest of World segment, our three largest customersaccounted for an aggregate of approximately 5% of our sales in fiscal 2012. With certain of our largeinternational supermarket customers and with our buying group customers, we sign overarching internationalcontracts with an average length of two years, as well as annual contracts on the national or individual level.

In the Out of Home segment, we sell our liquid roast products and equipment directly to businesses,hospitals, hotels and restaurants as well as to third party distributors who then distribute our products tocustomers. No single customer has accounted for more than 5% of our Out of Home sales in any of the past threeyears. Our Out of Home customer contracts are generally for terms of three or more years with pricing terms thatare reviewed at least annually, and we have long-term relationships with many of our customers. We have long-term contracts with our third party distributors with pricing terms that are reviewed annually.

Operations and Supply Chain

Our operations group manages our integrated supply chain for our European operations from theNetherlands, the Netherlands in close collaboration with Decotrade GmbH in Zug, Switzerland and Decotrade doBrasil in Santos, Brazil, the green coffee and tea procurement arms of our business. Our operations in Brazil,Australia and Thailand are managed autonomously by our operations groups in those countries in collaborationwith Decotrade do Brasil, using principles and processes similar to those described below. Our instant coffee soldin Australia is supplied from our European operations.

Raw materials

Our primary commodity is green coffee. We buy both Arabica and Robusta coffee beans for use in differentregional markets and blends across our product lines. Decotrade GmbH buys coffee from multiple coffee-producing regions around the world both on the coffee markets and on a negotiated basis. Decotrade do Brasilbuys coffee in Brazil through direct relationships with cooperatives, cooperative groups, farms and estates tomeet our domestic coffee needs in the large and growing Brazilian market. Additionally, in recent years,Decotrade do Brasil has bought and sorted green coffee to sell to Decotrade GmbH as well as to third parties,including competitor coffee companies and coffee traders. In future periods, we intend to significantly reduce theamount of green coffee that we buy for sorting and resale to third parties.

The supply and price of green coffee are subject to fluctuations. Supply and price of all coffee grades areaffected by multiple factors, such as speculation in the commodities markets, weather, seasonal fluctuations, realor perceived shortages, pest or other crop damage, land usage, the political climate in the producing nations,competitive pressures, labor actions, currency fluctuations, armed conflict and government actions, includingtreaties and trade controls by or between coffee producing nations. Cyclical swings in commodity markets arecommon and the most recent years have been especially volatile for both the “C” price of coffee (the price forArabica coffee quoted by the Intercontinental Exchange in New York) and the “Liffe” price of coffee (the pricefor Robusta coffee quoted by the Exchange in London).

Both Arabica and Robusta prices increased by approximately 20% between 2011 and 2012. After a downwardscorrection in fiscal 2012, we expect our commodity costs to decline in fiscal 2013 versus fiscal 2012, although weexpect that coffee prices will remain volatile for the foreseeable future. We buy Arabica and Robusta coffees whichare traded at a premium or discount to the New York “ICE” and London “Liffe” price quotations, reflecting theirintrinsic quality value and availability. Premiums and discounts are subject to significant variations.

Green coffee price increases impact our business by increasing our costs to make our coffee products andwe are often not able to increase our prices to our customers concurrently with increases in green coffee prices.Decreases in the price of green coffee impact our business by creating pressure to decrease our sales prices.

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Because of the volatility in the price of green coffee, we employ hedging mechanisms to lock in prices for futuregreen coffee deliveries, consistent with our overall risk management program. While we typically enter intoforward contracts for shorter periods, certain of these contracts may be made up to 12 months in advance ofdelivery. Since coffee trades are made on a U.S. dollar basis and we make our sales principally in euros, we alsoemploy currency hedges to manage our currency risks. Our hedging strategies are principally focused onobtaining price stability and mitigating market risk.

Customers and consumers have become increasingly interested in purchasing certified sustainable coffee.To meet that demand, we expect to purchase certified sustainable coffee representing 20% of our annual coffeevolume by 2015, which would significantly increase our sustainable green coffee purchases. Certain of ourcompetitors have announced similar plans to purchase a significant amount of sustainable coffee. Because thesupply of coffee certifiable as sustainable is limited, the cost of acquiring such coffee may increase significantly.

We purchase our tea requirements (black and green teas) directly from numerous importers and growers inAsia and Africa. Unlike in the coffee market, no regulated futures markets exist for the tea market. This meansthat we do not employ derivative tools for tea price risk mitigation. Unlike our recent experience in the greencoffee market, the tea market has not been subject to significant volatility in recent years. The average annualprice volatility range over the past several years has been approximately 20% and varies from region to regionand from quality segment to quality segment. As the international tea business also trades on a U.S. dollar basis,the Company faces the same currency exposure as for green coffee and we employ a similar currency hedgingstrategy.

Manufacturing

Our manufacturing units are responsible for the production of our coffee and tea products and packaging.The manufacturing units receive forecasts from our marketing and sales teams and use these forecasts to makeoptimal production plans to manufacture the required end-products and send them to the appropriate countrywarehouse for ultimate distribution to the customer. We own manufacturing facilities in the Netherlands,Belgium, France, Hungary, Spain, Greece, Poland, Thailand and Brazil, and we lease manufacturing facilities inAustralia and Spain. Because of the significant variation in the packaging of our diverse product lines, ourmanufacturing facilities are typically designed to handle a specific type of packaging, as well as production ofcertain coffee products. For example, our Senseo coffee pads are produced in our Grimbergen, Belgium andUtrecht, the Netherlands facilities, while we manufacture all of our L’OR EspressO capsules in Andrézieux,France. Our tea products are produced in Joure, the Netherlands and Budapest, Hungary. Historically, our liquidroast and instant coffee products were produced at facilities in Joure, the Netherlands, Nava Nakorn, Thailandand Virginia, United States. The facility in Virginia was sold as part of Sara Lee’s sale of its North Americanfoodservice business to Smucker’s, and these products are now produced at a single site in Joure. In fiscal 2010and 2011, we made significant investments in certain of our manufacturing facilities to improve our blending andproduction capabilities for a total amount of €36 million. Many of our manufacturing facilities meet the standardsof the International Organization for Standardization, an international industrial and commercial standard-settingbody.

Inventory

Our integrated supply chain, combined with our enterprise resource planning software capabilities, andsteered by our standardized sales and operation planning (S&OP) process, enables us to have available sufficientquantities of desired finished products while minimizing our inventory stocks throughout the supply chain.

The supply chain is triggered by the demand for products from each of the countries in which we operate.The monthly S&OP consensus forecast is submitted by the marketing and sales units in each country directly tothe factories, and the aggregate of these forecasts is used as the basis for our production planning. Because thereis full stock transparency in our supply chain, factories can optimize their production planning, while ensuring

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service levels. The current flexibility in the factories makes it possible to produce the required amount of finishedproduct for the high demand SKUs representing approximately 75% of our total sales volume on a weekly basis.

Decotrade translates these forecasts, together with its mid-term and long-term forecasts, into purchasingorders for the different types and qualities of green coffee and tea needed. To assist Decotrade in this process, weemploy a proprietary algorithm that works with our flex-blending system to systematically adjust recipes andblending requirements according to customer and manufacturing unit needs and the current prices andavailability of various types of green coffee.

Before purchase and before shipment, green coffee and tea samples are taken in the source country and sentto Decotrade for testing to ensure that the coffee or tea is of the expected type and quality. Typically, we thentake possession of green coffee and tea meeting our requirements at the point of shipment. The raw materials areshipped to us via either our central hub in Antwerp, Belgium or our hub in Hamburg, Germany. Our third partyhub managers process the shipments of green coffee and tea and coordinate delivery of the raw materialshipments to the appropriate factories for further processing. Finished products are sent directly to warehouses ineach country in which we sell our products. These warehouses are leased and managed for us by third partywarehousing service providers. We sign three year contracts with these service providers, with whom wetypically have long-term relationships.

Country Supply Chain Organizations

Our country supply chain organizations support our marketing and sales units with a goal of achievingmaximum product availability while minimizing our inventory stock. Our country supply chain organizationsalso take care of the full “order to cash” cycle, including the delivery of the products to our customers.Additionally, our country supply chain manages our relationship with our logistics service providers, to which wehave outsourced storage and transport of finished products and raw materials.

Distribution

We principally distribute our multi-serve, single-serve, instant and tea products in our Retail—WesternEurope segment directly to our retail customers through supply contracts that we sign with individual retailcustomers or with buying groups that are generally composed of regional retailers. We also employ wholesalerson a limited basis to distribute our products in certain areas where our retail customers are less geographicallyconcentrated. In the Retail—Rest of World segment, we distribute our products both directly to the majorsupermarket retailers, as well as to wholesalers and distributors who assist us in getting our products into smaller,independent retailers. Our retail contracts with individual retail customers are typically for one year, while ourcontracts with buying groups are generally for one or two years. We have long-term contracts with our wholesalecustomers with pricing terms that are reviewed annually.

In our Out of Home segment, we sell our Cafitesse liquid roast products, multi-serve and instant coffeesdirectly to businesses, hospitals, hotels and restaurants. Approximately half of our sales are made via direct saleto the customer. We provide free of charge, sell or lease our Cafitesse machines to customers and then providethe customers with their liquid coffee requirements for use in the machines. We also sell service contracts for thecoffee machines, which provide timely customer service via our own service engineers or third party serviceengineers in certain geographic markets. Additionally, we contract with distributors to sell our products tocustomers. We have long-term contracts with our third party distributors with pricing terms that are reviewedannually.

Competition

The coffee and tea industry in which we operate is highly competitive, with an emphasis on product qualityand taste, price, reputation, brand differentiation, variety of product offerings, advertising, product packaging and

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package design, supermarket and grocery shelf space and alternative distribution channels. We compete withother large international and national coffee and tea companies as well as smaller regional and specialty coffeeand tea companies, private label coffee and tea brands and hard discounters. Consumer preferences as to theblend or flavor and convenience of purchases continue to change, with differing preferences around the world.

We are the third largest global coffee company by coffee volume but we aspire to become the number twocoffee and tea company in the world. Our largest competitors are Nestlé S.A., Kraft Foods, Inc. and private labelproducers. We also compete against Tchibo GmbH, Strauss Group Ltd. and a range of other local competitors inmost countries where we have a presence. Our largest tea competitor in our markets is Unilever. Our majorglobal competitors in our Out of Home segment are Kraft Foods, Inc. and Nestlé S.A. In the Netherlands, our Outof Home brands compete against Autobar Group and Maas International, and in each of our Out of Homemarkets we compete against many small competitors.

We expect competition in coffee and tea to remain intense, both within our existing customer base and as weexpand into new countries and regions in the future. In the coffee and tea industry, we compete primarily byproviding high-quality, premium coffee and tea, including a full range of coffee products across all subcategoriesof the coffee industry, easy access to our products through retail and out of home outlets and superior consumerinsight. We also believe that the strength of our brands and our diverse product offering sets us apart from ourcompetitors because we offer a wide array of coffee and tea products from well-known and trusted brands withimpressive market penetration. While we believe we currently compete favorably with respect to all of thesefactors, there can be no assurance that we will be able to compete successfully in the future.

Seasonality

Historically, we have not experienced significant seasonal variations in our total sales.

Intellectual Property

We market our products under hundreds of trademarks, service marks and trade names in Europe and inother countries in our markets, the most widely-recognized being Douwe Egberts, Senseo, Maison du Café,Marcilla, Merrild, L’OR, Pickwick, Pilão, Hornimans, Moccona and Cafitesse. We also benefit from ourportfolio of patents, registered designs, copyrights, know-how and domain names. Specifically, we have patentpositions protecting our products and technologies for key product categories in single-serve, portioned espresso,and out of home coffee, including liquid coffee. We also license certain intellectual property from third-partiesand to third parties. Our business is not dependent on any one patent, although the loss of certain trademarkscould have a material adverse effect on our business. We use all appropriate efforts to protect our brands,trademarks, and technologies.

Though laws vary by jurisdiction, trademarks generally remain valid as long as they are in use and/or theirregistrations are properly maintained and have not been found to have become generic or otherwise aresuccessfully challenged by third parties. Most of the trademarks in our portfolio, including all of our core brands,are covered by trademark registrations in the countries of the world in which we do business. Trademarkregistrations generally can be renewed indefinitely as long as the trademarks are in use. We actively register,renew, protect and maintain our core trademarks. However, trademark registrations for the Douwe Egberts brandin certain countries in the Middle East are held on our behalf by another party with whom we are currently in adispute. We plan to continue to use all of our core trademarks and plan to renew the registrations for suchtrademarks for as long as we continue to use them.

For more than a decade, we have worked together with Philips on an exclusive basis on the development,manufacturing, sale and distribution of the Senseo coffee pad system. On March 30, 2012, we terminated theagreement that had governed our relationship with Philips against payment of a termination fee. Concurrentlywith terminating the prior agreement, we and Philips entered into a new partnership agreement and a trademark

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transfer agreement, which redefined our relationship in several significant respects. Philips transferred to us allits rights, title and interest in the Senseo trademark against payment of a one-time trademark transfer fee, and weentered into a new partnership agreement with Philips, pursuant to which Philips will be our exclusive partner forthe commercialization of coffee systems in the consumer field, including those to be developed under thetrademark Senseo and commercialized by both parties under our license of the Senseo trademark to Philips andPhilips’ license of the Philips trademark to us. The termination and trademark transfer fees totaled €170 million.The new partnership agreement and trademark transfer agreement became effective as of January 1, 2012 and thepartnership agreement expires (unless renewed) on December 31, 2020. Under the partnership agreement, eachparty is anticipated to be responsible for its own profits and losses, and we are not obliged to pay to Philips anyroyalty payments.

On January 3, 2012, Sara Lee entered into a license and services agreement with JMS Foodservice, LLC, anaffiliate of Smucker’s, which we refer to as JMS, in connection with the sale of our liquid coffee products toJMS. Under the terms of this agreement and the related sale of assets, we assumed the rights and obligations ofSara Lee pursuant to the license and services agreement. The licenses granted under such agreement apply to theUnited States, Canada, Mexico, and most of the Caribbean, and relate to JMS commercializing our liquid coffeeproducts and technology in such territory. Under the agreement, we granted to JMS non-exclusive licenses to ourexisting technology used in the manufacturing, dispensing, or packaging of our coffee business, exclusivelicenses to our future technology used in the manufacturing, dispensing or packaging of our coffee business andexclusive, royalty-free licenses in and to certain of our trademarks, including the Douwe Egberts, Pickwick andCafitesse trademarks, in each case for use in the foodservice trade channel in such territory. The license to theDouwe Egberts and Pickwick trademarks lasts until January 3, 2019. The license to the Cafitesse trademark lastsuntil January 3, 2022 and thereafter converts into a perpetual, non-exclusive license.

Government and Trade Regulation

We are subject to legislation and regulation in the EU and in each of the countries in which we do businesswith respect to: product composition, manufacturing, storage, handling, packaging, labeling, advertising and thesafety of our products; the health, safety and working conditions of our employees; our pensions; and ourcompetitive and marketplace conduct. On November 22, 2011, the EU enacted a new Food InformationRegulation, which will require us to change the labels on certain of our products prior to December 13, 2014 toprovide additional nutrition and ingredient information. With respect to environmental regulation, our operationsand properties, past and present, are subject to a wide variety of EU regulations and directives and local laws andregulations in the jurisdictions in which we do business. The legislative framework in the EU, as well as in otherjurisdictions in which we operate, which we refer to as ESH laws, covers topics such as air emissions, wastewater discharge, noise levels, energy efficiency; the presence, use, storage, handling, generation, treatment,emission, release, discharge and disposal of hazardous materials, substances and wastes; the remediation ofcontamination, and occupational safety and health. The following ESH laws are among the most significant toour business: the EU integrated pollution control and prevention directive, the EU packaging waste directive, theEU waste directive, the EU waste of electrical and electronic equipment directive, the EU regulations on the useof certain hazardous substances and the EU greenhouse gas emission allowance trading scheme. EU-levellegislation, including the ESH laws and the Food Information Regulation, is also implemented in nationallegislation in the EU member states and we are therefore subject to regulation by both the EU and a large numberof national and local regulatory bodies.

Our operations are also subject to various international trade agreements and regulations. Our competitiveand marketplace conduct is principally regulated by rules of competition as set forth in articles 101 and 102 ofthe Treaty on the functioning of the European Union, the regulations and directives issued by the EuropeanCommission, decisions of the European Court of First Instance, the European Court of Justice and the EuropeanCommission and notices issued by the European Commission, as well as the translations and/or implementationsthereof in the respective laws and regulations of the different member states. We rely on legal and operational

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compliance programs, as well as local in-house and external counsel, to guide our businesses in complying withthe applicable laws and regulations of the jurisdictions in which we operate.

Financial Targets

We have established the financial targets set forth below to measure our operational and managerialperformance on a company-wide level. The financial targets set forth below are our internal targets for salesgrowth, adjusted EBIT margin, operating working capital and capital expenditures for future periods. Certain ofthese financial targets are presented as “mid-term” targets. We have not defined, and do not intend to define,“mid-term,” and the mid-term financial targets set forth below should not be read as indicating that we aretargeting such metrics for any particular fiscal year. Our ability to achieve these financial targets is inherentlysubject to significant business, economic and competitive uncertainties and contingencies, many of which arebeyond the control of the Company, and upon assumptions with respect to future business decisions that aresubject to change. As a result, our actual results will vary from the financial targets set forth below, and thosevariations may be material. Many of these business, economic and competitive uncertainties and contingenciesare described in the section of this Annual Report entitled “Risk Factors”. We do not intend to publish revisedfinancial targets to reflect events or circumstances existing or arising after the date of this Annual Report or toreflect the occurrence of unanticipated events. The financial targets should not be regarded as a representation bythe Company or any other person that we will achieve these targets in the time period indicated (in the case ofoperating working capital or capital expenditures) or in any time period. Readers are cautioned not to placeundue reliance on the financial targets.

Subject to the foregoing, we are targeting the following for purposes of measuring operational andmanagerial performance on a company-wide level:

• Sales growth of approximately 5% to 7% in the mid-term

• Adjusted EBIT margin of approximately 15% to 17% in the mid-term

• Capital expenditures, as a percentage of total sales, of approximately 4% to 5% in fiscal 2013 andfiscal 2014

• Capital expenditures, as a percentage of total sales, of approximately 3% to 4% in fiscal 2015

• Operating working capital, as a percentage of total sales, of approximately 10% in fiscal 2015, with atarget of reaching 5% in the future

Adjusted EBIT margin and operating working capital are defined in “Selected Financial Data.” AdjustedEBIT and operating working capital are not measures calculated in accordance with IFRS and may not becomparable to similarly named measures used by other companies. Adjusted EBIT should not be considered asan alternative to operating profit or profit for the period, and operating working capital should not be consideredas an alternative to operating cash flow.

The PricewaterhouseCoopers Accountants N.V. report included in this Annual Report relates solely to theCompany’s historical financial statements. It does not extend to the financial targets and should not be read to doso. As the financial targets were prepared to measure the Company’s operational and managerial performance,they were not prepared with a view toward compliance with published guidelines of the SEC or the guidelinesestablished by the American Institute of Certified Public Accountants for preparation and presentation ofprospective financial information.

4C Organizational Structure

D.E MASTER BLENDERS’ business is carried out through a number of operating subsidiaries around theworld. A list of the Company’s principal operating subsidiaries, all of which are 100% owned, directly orindirectly, is attached hereto as Exhibit 21.1. In addition, D.E MASTER BLENDERS has a 45% non-controllinginterest in Kaffehuset Friele A/S, which is treated as an associate.

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4D Property, Plants and Equipment

We own most of our manufacturing plants and lease our warehouses. Additionally, we have servicecontracts with the hub managers at our central distribution hubs in Antwerp, Belgium and Hamburg, Germany.Our leased warehouse facilities are generally subject to lease terms of three years. Management believes that ourfacilities are maintained in good condition and are generally suitable and of sufficient capacity to support ourcurrent business operations. We intend to spend approximately €150 million on tangible fixed assets for theperiod through June 30, 2013.

Our manufacturing facility in Nava Nakorn, Thailand was damaged by the flooding in Thailand in October,2011. As of the start of fiscal 2013, the facility is fully operational again. Our expenses related to the flooding ofour facility in Thailand, including lost business income, are covered by our insurance policies.

The table below sets forth the location, principal use and size of our material facilities. Each of thesefacilities is in use and owned directly or indirectly by D.E MASTER BLENDERS. D.E MASTER BLENDERS’property in the Netherlands has been pledged with a lien of €23.8 million in favor of Stichting VUDE, afoundation which guarantees the payment of early retirement allowances and payments according to social plansin the Netherlands.

Owned Facilities

Location Principal Use

Fiscal 2012 ProductionVolume

(in thousands of tons)Size (in thousands of

square feet)

Joure, The Netherlands Manufacturing 27 752.6Jundiai, Brazil Manufacturing 135 432.4Utrecht, The Netherlands Manufacturing 55 346.9Grimbergen, Belgium Manufacturing 40 177.5Budapest, Hungary Manufacturing 13 144.0Andrézieux, France Manufacturing 20 121.9Sulaszewo, Poland Manufacturing 20 80.2Salvador, Brazil Manufacturing 15 49.5Athens/Aigaleo, Greece* Manufacturing <5 47.2Nava Nakorn, Thailand Manufacturing 10 55.9Oinofyta, Greece* Manufacturing <5 7.6Mollet, Spain Manufacturing 10** 36.3Budapest, Hungary Warehouse 104.4Piumhi, Brazil Warehouse/Processing 76.1Utrecht, The Netherlands Office 364.1Grimbergen, Belgium Office 124.2Joure, The Netherlands Office 91.8Utrecht, The Netherlands Office 56.6

* Production to be consolidated into Oinofyta facility in 2013.** Production split across owned and leased portions of the facility.

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Leased Facilities

Location Principal Use Lease Term

Fiscal 2012 ProductionVolume

(in thousands of tons)Size (in thousands

of square feet)

Kingsgove, Australia Manufacturing June 30, 2017 <5 45.1Mollet, Spain Manufacturing December 31, 2020 10(1) 137.3Grimbergen, Belgium Office 240 Months 124.2Barcelona, Spain Office July 1, 2014 86.5Barueri, Brazil Office March 23, 2013 52.6Villepinte, France Office September 30, 2012(2) 88.6Paris, France Office September 30, 2024 53.8Middelfart, Denmark Office September 30, 2017 61.7Amsterdam, The

NetherlandsOffice June 30, 2022 56.45

(1) Production split across owned and leased portions of the facility.(2) After June 30, 2012, the lease contract for the Villepinte office was not extended. Instead, another facility of

54,400 square feet is leased in Paris, France with a lease term until August 31, 2014.

We also lease our approximately 56,450 square-foot headquarters located in Amsterdam, the Netherlands.Our headquarters houses our various sales, marketing, operational and corporate business functions.

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ITEM 4A. UNRESOLVED STAFF COMMENTS

Not applicable

ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS

OPERATING AND FINANCIAL REVIEW

The following information should be read in conjunction with the historical financial statements and withthe financial information presented in the section entitled “Selected Financial Data” included elsewhere in thisAnnual Report. Our financial statements are prepared in accordance with IFRS as issued by the InternationalAccounting Standards Board and adopted by the European Union. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Such statements are based upon currentexpectations that involve risks and uncertainties. Any statements contained herein that are not statements ofhistorical fact may be deemed to be forward-looking statements. For example, the words “believes”,“anticipates”, “plans”, “expects”, “intends” and similar expressions are intended to identify forward-lookingstatements. Our actual results could differ materially from those discussed in these forward-looking statements.Factors that might cause such a discrepancy include, but are not limited to, those discussed in “Liquidity andCapital Resources” below and “Risk Factors” above. All forward-looking statements in this Annual Report arebased on information available to us as of the date of this Annual Report and we assume no obligation to updateany such forward-looking statements. See “Forward Looking Statements”.

As discussed in Note 1 of our audited financial statements included in this Annual Report, our historicalfinancial statements were restated for accounting irregularities and certain other errors involving previousfinancial results for our Brazilian operations. The accounting irregularities identified in the Brazil operationsincluded the overstatement of accounts receivable due to the failure to write-off uncollectible customer discounts,improper recognition of sales revenues prior to shipments to customers, the understatement of provisions forvarious litigation issues, unsupported expenses reversals and postponements, moving inventory out ofwarehouses that were about to be verified by internal and external auditors, the failure to write-off obsoleteinventory and other inventory valuation issues. The financial information for the fiscal years 2010 and 2011included in this operating and financial review section is based on these restated financial statements.

Overview

We are a leading, focused pure-play coffee and tea company that offers an extensive range of high-quality,innovative coffee and tea products that are well-known in retail and out of home markets across Europe, Brazil,Australia and Thailand. Our business is currently organized into three operating segments, Retail—WesternEurope, Retail—Rest of World and Out of Home.

Within our Retail—Western Europe and our Retail—Rest of World segments, our principal products areroast and ground multi-serve coffee, roast and ground single-serve coffee pads and capsules, instant coffee andtea. We sell these products predominantly to supermarkets, hypermarkets and through international buyinggroups. In our Out of Home segment, we offer a full range of hot beverage products but focus on our liquid roastproducts and related coffee machines. Our products and the related machines in the Out of Home segment aresold either directly to businesses, hotels, hospitals and restaurants or to foodservice distributors for distribution tothe customer.

In our Retail—Western Europe segment, our multi-serve coffee is principally sold under the followingbrands: Douwe Egberts in the Netherlands, Belgium and the United Kingdom, L’OR and Maison du Café inFrance, Marcilla in Spain, Merrild in Denmark, Kanis & Gunnink in the Netherlands and Jacqmotte in Belgium.Our single-serve coffee is principally sold under the brand name Senseo, which is generally co-branded, such asDouwe Egberts Senseo and L’OR Senseo, in the Netherlands, Belgium, France, Germany and Spain and selectother countries, L’OR EspressO in France, the Netherlands and Belgium and L’aRôme EspressO in Spain. Our

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instant coffee is sold under the Douwe Egberts brand in the United Kingdom and under local brands in certain ofour Western European markets. Our tea is sold under the brand names Pickwick in the Netherlands, Belgium andDenmark and Hornimans in Spain. Retail—Western Europe covers the following countries: the Netherlands,Belgium, France, Spain, Denmark, Greece, Germany and the United Kingdom.

In our Retail—Rest of World segment, our multi-serve coffee is principally sold under the following brands:Pilão, Caboclo, Damasco and Moka in Brazil, Harris in Australia and Prima in Poland. Our single-serve coffeeis sold in Brazil under the Senseo brand name, co-branded as Pilão Senseo. Our instant coffee is primarily soldunder the Moccona brand in Australia and Thailand. Our tea is sold under the brand name Pickwick in the CzechRepublic and Hungary. Retail—Rest of World covers the following countries: Brazil, Hungary, the CzechRepublic, Poland, Australia, Thailand and Russia.

Our Out of Home segment is concentrated in the Netherlands. Approximately half of our Out of Home salesare made directly to businesses, hospitals, hotels and restaurants, while we also work with distributors whodistribute our product to the customer in certain markets. Through our Cafitesse umbrella brand, we offer a lineof products to be used in the liquid roast machines that we sell, lease or provide free of charge to our customers.Additionally, through our Piazza D’Oro brand we offer premium espresso coffee products and machines. Wedevelop the proprietary coffee machines in-house and employ suppliers to produce the machines. We alsoemploy service technicians in most of our major markets who we train to service our machines in the field.

Our senior management reviews the performance of each segment individually, based on segment sales andadjusted EBIT. Segment adjusted EBIT represents segment operating profit excluding the impact of restructuringcharges and restructuring-related costs, costs associated with Sara Lee’s branded apparel business disposed priorto fiscal 2009, impairment, gains and losses on the sale of assets, curtailment and past service costs and othercosts management believes are unrelated to our underlying business. In addition, we do not allocate certain salesand costs to the segments. These unallocated items include the sale of green coffee beans to third parties,corporate overhead costs and unrealized mark-to-market gains and losses on commodity derivative financialinstruments.

Key performance indicators

We monitor the performance of our operations against strategic objectives on a regular basis. We assess ourperformance against the strategy, budget and forecasts using various financial measures including the following:

Fiscal Year Ended

June 30, 2012 July 2, 2011 July 3, 2010

restated restated(all amounts in millions of euro, except

percentages)

Like for like sales growth(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.4% 10.5% n/aEBIT(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €109.9 €327.5 €344.6EBIT margin(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.9% 12.6% 14.9%Adjusted EBIT(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €321.8 €357.2 €366.1Adjusted EBIT margin(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.5% 13.8% 15.8%

(a) These amounts are not measures determined in accordance with IFRS. See “Selected Financial Data” for adefinition of the measure, a reconciliation of the measure to IFRS and a discussion regarding the limitationof the use of such measures.

Key factors affecting results of operations

Our results of operations are driven by a combination of factors affecting our industry as a whole andvarious operating factors specific to us. The following is an overview of the key factors affecting our resultsduring the years presented.

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Separation from Sara Lee. On June 28, 2012, the international coffee and tea business of then Sara LeeCorporation was spun off and through a series of transactions became owned by D.E Master Blenders 1753 N.V.,a separate publicly traded company. Prior to the separation we operated as a part of a larger group of companiescontrolled by Sara Lee.

Our financial statements prior to separation have been prepared on a “carve-out” basis from the Sara Leeconsolidated financial statements using the historical results of operations, assets and liabilities attributable to theinternational coffee and tea operations of Sara Lee, and certain other assets and liabilities that we retained inconnection with the separation as described further in Note 1 to our historical financial statements.

As we have not previously operated independently, as described above, the income statements discussedherein are not necessarily indicative of our future performance and do not necessarily reflect what our financialperformance would have been had we been an independent, publicly traded company during the periodspresented.

There are limitations inherent in the preparation of all carve-out financial statements due to the fact that ourbusiness was previously part of a larger group. The basis of preparation included in our financial statementsprovides a detailed description of the treatment of historical transactions. Our profits have been most notablyimpacted by the following consequences of carve-out accounting:

• Our income statement includes within total selling, general and administrative expenses an allocationto us from Sara Lee for the services provided by various Sara Lee functions including, but not limitedto, executive oversight, legal, finance, human resources, internal audit, financial reporting, tax planningand investor relations. Upon our separation we became directly responsible for these functions.Accordingly, the amounts of costs reflected in our income statements are not necessarily indicative ofour future costs. The total amount allocated to us by Sara Lee was €23.7 million, €25.4 million and€23.7 million in fiscal 2012, 2011 and 2010, respectively.

In addition, we incurred additional direct corporate overhead costs during the periods presented. Basedon current financial plans our management estimates that our total corporate overhead costs will beapproximately €45 - €50 million on an annual basis after separation. Assuming total corporateoverhead costs of €45 - €50 million, this would result in an increase of approximately €5 million fromthe amounts reflected in our fiscal 2012 income statement. This estimate is based on assumptionsmanagement believes are reasonable, however the actual amount may vary from this estimate.

• Our income tax expense for periods prior to separation is computed on a separate company basis, as ifwe operated as a stand-alone entity or a separate consolidated group in each material jurisdiction inwhich we operate. In jurisdictions which permitted fiscal unity, our operations were typically includedwith other Sara Lee operations in a consolidated group tax filing. As a result of this, the impact of thenew business model discussed below and potential future tax planning, our income tax expense maynot be indicative of our future expected tax rate. Although we are targeting an effective tax rate ofapproximately 30% in fiscal year 2013 and approximately 25% in fiscal years 2014 and 2015, noassurances can be made in this regard. A higher than anticipated effective tax rate could have anadverse impact on our financial condition and results of operations. In addition, for purposes of ourfinancial statements, we have assumed all taxes were settled by Sara Lee, and as result there are nocash taxes reflected in our operating cash flows. Consequently, our future operating cash flows will bereduced by tax payments which are reflected as distributions to Sara Lee in financing activities in thecombined statement of cash flow.

• We historically provided financing to Sara Lee. Our financial statements prior to the separationreflected loans receivable and the associated interest income. In connection with the separation, theseloans were settled with Sara Lee.

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As a consequence of various transactions between us and Sara Lee in connection with the separation,including the payment of a special dividend, our cash and cash equivalents were significantly reducedfrom the balance at the end of fiscal 2011. In addition, our outstanding indebtedness increased upon theseparation. These changes were offset by a corresponding decrease on our combined statement offinancial position in parent’s net investment. The additional indebtedness, along with any additionalborrowings entered into in the future, will increase interest expense in future periods as describedbelow in “Operating and Financial Review—Liquidity and Capital Resources” beginning on page 65.

• The entities within Sara Lee’s international coffee and tea business have certain legal liabilities relatedto Sara Lee’s branded apparel business that was sold prior to fiscal 2009. These liabilities, whileunrelated to our business, will be retained following the separation. The most significant of these relateto pensions and medical claims related to injuries caused to prior employees as a result of noiseinduced hearing loss and asbestos exposure, which may result in payments to those individuals for theirrelated medical expenses. These liabilities are reflected in our combined balance sheets and theassociated costs are reflected in our combined income statements.

In addition, as part of the separation, the Group assumed € 241.6 million of certain liabilities related tobusinesses previously disposed of by Sara Lee. The liabilities primarily relate to Sara Lee’s household and bodycare business and its international bakery business. These liabilities include certain legal claims and restructuringobligations, tax indemnifications, and retirement benefit obligations, which are unrelated to the Group’soperations. Additionally, we entered into various arrangements in connection with the spin-off, including, but notlimited to, certain indemnification agreements that subject us to contingent liabilities.

Lastly, as part of the separation we will implement a new business model that will modify the way wemanage our product through our value chain. This modification will not impact our pre-tax profit; however wemay experience a shift in profitability between operating segments. Management is also still in the process ofmodeling the organizational structure, which could also result in a change in our segment structure. As part ofimplementing our new business model, we incurred costs of €29.3 million in fiscal 2012 and expect to spendapproximately €24.9 million over fiscal 2013 primarily related to changes in our information technologyplatform and other implementation costs. A portion of those costs will be capitalized (€8.1 million in fiscal 2012and €6.4 million in fiscal 2013) on our statement of financial position with the remainder expensed primarily asrestructuring related costs in the period incurred.

Based on the impacts of the separation discussed above, our operating expenses and cash outflows willincrease in future periods. We intend to implement various restructuring actions to offset these increases and tooptimize our structure. The amounts discussed represent our best estimates; however, the actual amounts mayvary from these estimates.

Commodity prices. The most significant cost item in the production of coffee products is the price of greencoffee beans, which are purchased from farmers and coffee bean vendors in various countries around the world.Green coffee is subject to volatile price fluctuations. The price of green coffee fluctuates based upon variousfactors including, but not limited to, weather, real or perceived shortages, the political climate in the producingnations, competitive pressures, currency fluctuations and speculation in the commodities markets. The price ofgreen coffee beans increased significantly in fiscal 2011 compared to fiscal 2010. During fiscal 2012, the marketcommodity prices decreased from the level at the end of fiscal 2011. We expect to see continued volatility in thecommodity market prices in future periods. Excluding the impact of the change in foreign currency translation,our total commodity costs increased by €237.5 million from fiscal 2011 to fiscal 2012. The commodity increaseof €237.5 million between fiscal 2011 and 2012 includes a €2.6 million benefit related to commodity derivatives.

We manage the risk associated with commodity price fluctuations through the use of commodity optionsand futures. Through these derivative options and futures, we are able to fix a portion of our price for anticipatedfuture deliveries of green coffee for a specified period of time. Given the price increases during fiscal 2011 wehave modified our risk management strategy to increase the length of this period for Arabica green coffee while

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continuing to use short term derivatives for our other green coffee purchases. On average we fix prices fordeliveries to our European operations for an advanced period of up to six to nine months. This period is six toeight weeks in case of deliveries to our Brazilian operation. As a result of our risk management strategy, there isa lag between a change in the commodity market prices and the impact on our results and consequently we didnot fully benefit during fiscal 2012 from the decline in commodity prices.

During the second half of fiscal 2011, we successfully raised sales prices to offset a portion of the increasein the price of green coffee beans. These sales price increases were partially offset by an increase in tradepromotions in response to competitor actions on pricing and as a result of agreements with resellers. Due to theintense competition in our industry, including the impact of private label products, and the timing lag betweencommodity cost increases and sales price increases, these sales price increases did not fully offset the significantincrease in the price of green coffee beans that occurred in fiscal 2011. As a result, the higher commodity costsresulted in a decrease to our gross profit of €19.6 million in fiscal 2011 and €0.7 million in fiscal 2012. Due tothe commodity costs decline, we may face pressure in the future from our customers to decrease our prices.

Impact of disposals by Sara Lee. We historically shared Sara Lee’s European corporate headquarters andvarious shared service centers with other Sara Lee businesses. These headquarters provided various corporateservices such as treasury, legal, information technology and certain tax services to the international businesses ofSara Lee. The shared service centers, located in various countries, provided such services as payroll processing,receivables and payables processing and various other accounting functions. With the disposals of Sara Lee’sother international businesses, which were completed by February 2012, we were the only remaininginternational business of Sara Lee. In connection with the terms of our separation, we now bear the full cost of allstranded international corporate overhead and shared service costs after separation. Our best estimate of thesestranded costs is that they are approximately €30 million on an annualized basis.

The disposal by Sara Lee of its other international businesses primarily occurred during fiscal 2011 and thefirst half of fiscal 2012. In addition, Sara Lee entered into transition services agreements in connection withcertain of the disposals, under which the shared service centers provided services. As such, the timing of theimpact of these stranded costs on our results is generally linked to the timing of the disposals by Sara Lee and thelength of any transition services agreements. As a consequence, we began absorbing a portion of these strandedcosts in fiscal 2011. The amount of stranded costs we have absorbed continued to increase through fiscal 2012due to (a) the finalization of additional dispositions and (b) the lost income from the expiration of certaintransition services agreements without the ability to reduce our costs within the same time frame.

In connection with the business disposals by Sara Lee, we began taking certain actions to reduce thesestranded costs including, but not limited to, renegotiation of our information technology contracts and reductionof corporate staff. Due to the time necessary to implement such cost reductions stranded costs increased ouroperating expenses in the second half of fiscal 2012 and we expect stranded costs will increase our operatingexpenses through part of fiscal 2013 in comparison to fiscal 2011. We believe these actions and the actionsdescribed below regarding restructuring charges will allow us to reduce the impact of stranded costs, to the extentpossible.

The actual timing of the full absorption of these costs, and any cost reductions resulting from the actionsdescribed above, will vary.

Foreign exchange movements. Our results are exposed to transaction and translation risk associated withforeign currency movements.

Transaction risk—We operate internationally and as a result are exposed to foreign exchange risk arisingfrom various currency exposures, primarily with respect to the U.S. dollar, Brazilian real, British pound, Danishkrone, Hungarian forint, Polish zloty, Thai baht, Russian ruble and Australian dollar against the European euro.

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Foreign exchange risk arises primarily from commercial transactions such as the purchase of commodities,recognized monetary assets and liabilities. As a consequence of the global economic downturn, currency rateshave become more volatile, increasing our exposure to this risk specifically in Eastern European markets.

We use forward exchange and option contracts to reduce the effect of fluctuating foreign currencies onknown foreign currency exposures. Gains and losses on these derivative instruments are intended to offset gainsand losses on the related transactions in an effort to reduce the earnings volatility resulting from fluctuatingforeign currency exchange rates. We have not designated any of our foreign exchange derivatives as hedges foraccounting purposes and, as a result, the change in fair value is recognized directly through profit.

We had foreign currency gains of €42.5 million and €40.2 million during fiscal 2012 and 2010, respectively,and foreign currency losses of €40.9 million during fiscal 2011. These were offset by a loss on foreign currencyderivatives of €5.6 million and €9.8 million in fiscal 2012 and 2010, respectively, and a gain on foreign currencyderivatives of €15.5 million in fiscal 2011. These gains and losses are included in finance costs in our combinedincome statement, excluding those related to commodities that are included in cost of sales, and do not impactour segment profitability.

Translation risk—The functional currency of a number of our subsidiaries is a currency other than the euroand as a result the income statement and statement of financial position of each of those subsidiaries must betranslated for purposes of preparing our financial statements. Each period the financial statements of ournon-euro functional subsidiaries are translated to the euro by applying the closing rate to the statement offinancial position and an average rate to the income statement. As a consequence, our combined results areimpacted by these currency movements. This resulted in foreign currency translation gains of €47.5 million and€111.9 million in fiscal 2012 and 2010, respectively, and a foreign currency translation loss of €2.2 million infiscal 2011. These foreign currency translation gains and losses are reflected in total equity/parent’s netinvestment in our statement of financial position.

Launch of new products and rationalization of existing SKUs. Based on the unique consumer and customerinsights we have gained over numerous decades, we have a deep understanding of the coffee and tea categoryand the preferences of its consumers and customers. This, coupled with our strong research and developmentcapabilities, has positioned us well to launch new products and concepts that reflect the preferences of ourconsumers and customers.

During fiscal 2012, 2011 and 2010, we launched various new products. The most significant productlaunched during this time was L’OR EspressO single-serve capsules in France in April 2010. These capsules,which are compatible with the Nespresso® single-serve system, marked our entry into the single-serve espressomarket. We have subsequently introduced these capsules in the Netherlands and Belgium, and in Spain, wherethe product is sold as L’aRôme EspressO.

The launch of new products results in focused advertising and promotion costs in the period for thoseproducts and markets in which they are sold. We believe these costs are recovered in future periods through theincreased sales resulting from the new products.

In addition, we incur upfront costs in anticipation of new products and when considering entering newmarkets. There are certain instances where after further research we may make a decision not to continue withthe product introduction or expansion into that market. For example, during fiscal 2011 we made a decision notto continue a planned expansion of our operations in the Russian market and as a result we impaired assets of€4.6 million. In fiscal 2012, we began using a distributor business model in Russia.

We expect to accelerate the development of new products and the introduction of new products in futureperiods, including Senseo Sarista. Therefore, we may experience an increase in our research and developmentcosts, capital expenditures related to supporting the research and development and increased advertising costsrelated to new product introductions.

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As we continue to monitor our portfolio of brands, we expect to eliminate certain SKUs in future periods.

Restructuring. During the periods presented, we have taken a number of actions to maximize the efficiencyof our operations. These actions included:

• Outsourcing of certain elements of our shared service function related to procurement, accounting andinformation technology;

• Reducing our overall cost structure to align our corporate overhead to our current organizationalstructure and business strategy;

• Headcount reductions to align with new management’s expectations of staffing needs as a stand-alonecompany;

• Renegotiating global IT contracts to align with our organizational structure; and

• Optimizing our manufacturing capacity. In connection with this, we rationalized our manufacturingfootprint through the closure of our Denmark manufacturing facility and the transfer of this productionto the Netherlands.

In connection with these actions, and in order to achieve the savings associated with these actions, weplanned to eliminate the positions of approximately 1,136 employees. Of these employees, contracts of 1,039employees were terminated as of June 30, 2012.

In connection with these actions, we recorded restructuring charges of €57.7 million, €25.2 million and€5.4 million in fiscal 2012, 2011 and 2010, respectively. The majority of the outstanding provision of€41.2 million at June 30, 2012 is expected to be paid out within the next 12 months with certain paymentsextending out five years.

Our restructuring charge for fiscal 2012 includes €25.8 million for contractual termination fees related tocertain IT contracts that were renegotiated to align with our organizational structure.

As a result of IT restructuring actions and certain other actions taken in fiscal 2012, along with theadditional capital expenditures, we estimate the annual cost savings of €55 - €75 million by the end of fiscal2015.

Sale of green coffee beans to third parties. During fiscal 2012, 2011 and 2010, we sold green coffee beansto third parties in Brazil. These sales were ancillary to our business and as a consequence not included in oursegment results. In fiscal 2012, 2011 and 2010, our green coffee bean sales were €134.4 million, €186.5 millionand €78.3 million, respectively, or €126.0 million, €170.5 million and €55.8 million, respectively, excluding theimpact of changes in foreign currency exchange rates, and had margins that were significantly lower than ournormal sales. Our green coffee bean sales to third parties decreased in fiscal 2012. During fiscal 2011, we tookadvantage of a system of taxes and rebates payable on trades of green coffee from Brazil that caused sales toincrease. The increase was driven by the increase in overall green coffee market prices and an increased volumeof sales. In January 2012, the Brazilian government ended this favorable tax treatment and as a result, we made astrategic decision to reduce our green coffee export sales in fiscal 2012. We expect that our green coffee exportsales will continue to decrease in future periods and will be approximately €45 - €50 million going forward.

Business combinations. We have made strategic acquisitions to strengthen our presence in several markets.In fiscal 2012, we acquired CoffeeCompany, a leading Dutch café store operator in the Netherlands; Tea Forté, aproducer of ultra-premium teas that are principally sold in the United States and Canada; the Denmark operationsof House of Coffee, a leading out of home provider of coffee and tea products in Norway and Denmark; andExpresso Coffee Automacao de Bebidas Quentes Ltda an out of home provider in Brazil. In fiscal 2011, weacquired Café Damasco, which provides us with a stronger presence in southern Brazil, where Café Damasco hasa strong market position. Our focus over the next twelve months will be implementing actions to strengthen theCompany organically, but we will continue to evaluate acquisition opportunities.

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Impact of 53rd week. Our fiscal year ends on the Saturday closest to June 30. Fiscal years 2012 and 2011were 52-week years and 2010 was a 53-week year. Excluding the 53rd week in fiscal 2010, we would have had€34.6 million less in sales and €16.0 million of lower gross profit.

Results of Operations

Throughout the results of operations we discuss the effect of the change in foreign currency exchange rateson our results and exclude this effect from the discussion of the change between periods. We have determined theimpact of the change in foreign currency rates by applying our budgeted fiscal 2012 euro conversion rate to allannual periods. The currencies with the most significant impact on our income statements are the Brazilian realand the Australian dollar. The budgeted exchange rates were 2.38 for the Brazilian real and 1.36 for theAustralian dollar for fiscal 2012, respectively.

Description of key line items

Sales—Sales comprises the fair value of the consideration received or receivable for the sale of goods andservices in the ordinary course of our activities. We recognize sales when the amount of sales can be reliablymeasured, it is probable that future economic benefits will flow to the entity and when specific criteria have beenmet for each of our activities as described below. We base our estimates on historical results, taking intoconsideration the type of customer, the type of transaction and the specifics of each arrangement.

We primarily generate sales from the sale of product. Sales of product are generally recognized when titleand risk of loss of the products pass to distributors, resellers or end customers. In particular, title usually transfersupon receipt of the product at the customers’ locations, or upon shipment, as determined by the specific salesterms of the transactions.

We also recognize lease revenue from the leasing of our coffee machines and maintenance fees associatedwith maintaining the coffee machines.

We provide a variety of sales incentives to resellers and consumers of our products such as discounts,rebates and cooperative advertising. These sales incentives are recorded as a reduction of sales.

Cost of sales—Cost of sales consists of costs incurred from the time raw materials are purchased to whenthe finished goods are delivered to their location immediately prior to external sale. Cost of sales also includessales incentives offered in the form of free product. Gains and losses arising from changes in the fair value ofinventory-related derivative financial instruments included in the fair value through profit or loss category arealso recorded in cost of sales.

Selling, general and administrative expenses—Selling, general and administrative expenses consist ofadvertising and promotion, distribution costs, selling and marketing expenses, research and development andother administrative functions. These costs include amounts associated with our restructuring actions and certainother items that management believes are unrelated to our ongoing operations.

Finance income, net—Finance income primarily represents income that we receive on our cash equivalentsand loans to Sara Lee and finance income generated from our defined benefit pension plans.

Finance costs, net—Finance costs are generally comprised of interest expense on borrowings andoverdrafts and the interest consequence of unwinding discounted provisions, foreign exchange gains and losses,excluding those related to commodities, and the change in fair value of our foreign currency and interest ratederivative financial instruments.

Share of profit from associates—This represents the share of profit from our investment in associates,which consists primarily of a 45% investment in Friele, a Norwegian company that produces coffee fordistribution to out of home and retail customers.

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Income tax expense—Income tax expense is comprised of current and deferred tax expenses. For furtherinformation see our accounting policies in Note 2 to financial statements.

Fiscal Year Ended Change

June 30, 2012July 2, 2011

restatedJuly 3, 2010

restated

2012 vs. 20112011 vs. 2010

restated

Actual % Actual %

(amounts in millions of euro, except percentages)

Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . €2,795.0 €2,593.3 €2,313.4 € 201.7 7.8 €279.9 12.1Cost of sales . . . . . . . . . . . . . . . . . . . . . . 1,787.1 1,611.6 1,347.7 175.5 10.9 263.9 19.6

Gross profit . . . . . . . . . . . . . . . . . . . . . . 1,007.9 981.7 965.7 26.2 2.7 16.0 1.7Selling, general and administrative

expenses . . . . . . . . . . . . . . . . . . . . . . . 898.2 656.4 623.8 241.8 36.8 32.7 5.2

Operating profit . . . . . . . . . . . . . . . . . . . 109.7 325.3 341.9 (215.6) (66.3) (16.6) (4.9)Finance income, net . . . . . . . . . . . . . . . . 132.2 91.8 55.3 40.4 44.0 36.5 66.0Finance expenses, net . . . . . . . . . . . . . . 17.4 (45.4) 14.7 62.8 (138.4) (60.1) (408.8)Share of profit (loss) from associate . . . 0.2 2.2 2.7 (2.0) (90.9) (0.5) (18.5)

Profit before income taxes . . . . . . . . . . . 259.5 373.9 414.6 (114.4) (30.6) (40.7) (9.8)Income tax expense . . . . . . . . . . . . . . . . 127.3 110.7 174.9 16.6 15.0 (64.2) (36.7)

Profit for the year . . . . . . . . . . . . . . . . . . € 132.2 € 263.2 € 239.7 (131.0) (49.8) € 23.5 9.8

Fiscal 2012 Compared Fiscal 2011

Sales

Sales for fiscal 2012 decreased by €21.1 million due to changes in foreign currency exchange rates,primarily driven by the Brazilian real and Australian dollar. In addition, our sales for fiscal 2012 decreased by€39.9 million related to the Company’s strategic decision to gradually phase out its green coffee export activities.These decreases were offset by a €35.7 million increase resulting from a full year Café Damasco’s operations ascompared to the seven months in the fiscal 2011 and the impact from the fiscal 2012 acquisitions.

After excluding the items listed above, our sales increased by €227.0 million. This increase waspredominantly a result of higher net sales prices that increased sales by €248.1 million. Our higher net salesprices primarily resulted from the full year effect of price increases implemented in the second half of fiscal 2011that were directly related to passing on a substantial portion of our commodity cost increases to customers.

In addition to sales prices, sales also increased by the continued growth of our single-serve capsules in ourRetail—Western Europe segment which was offset by an unfavorable change in mix and lower volumes of otherproducts in certain markets. These lower volumes included a decline that resulted from damage to ourmanufacturing facility in Thailand, which was caused by flooding in October 2011 resulting in a volume decreaseof €14.8 million, and from the discontinuation of our private label multi-serve business in France in fiscal 2011,which reduced sales by €13.3 million.

Gross profit

Gross profit increased by €26.2 million and our gross margin percentage declined from 37.9% in fiscal 2011to 36.1% in fiscal 2012.

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Our gross profit was favorably impacted by €12.8 million of gross profit from the full year of CaféDamasco’s operations as compared to the seven months in the fiscal 2011 and gross profit from the fiscal 2012acquisitions. Our gross profit was also favorably impacted by foreign currency movement of €7.7 million. Theseincreases were partially offset by a lower gross profit on green coffee sales.

Excluding these items, the increase in gross profit was €7.7 million. The increase in gross profit primarilyresulted from an increase in sales of our higher margin single-serve capsules. This was partially offset by salesvolume decreases, including an impact of €4.6 million related to the Thailand flood, and a general increase in ourcost of sales not related to commodities. During fiscal 2012 we increased our net sales prices by €248.1 millionhowever this was fully offset by an increase in commodity costs.

Selling, general and administrative expenses

Our total selling, general and administrative expenses, which we refer to as SG&A, increased by€241.8 million in fiscal 2012. We have presented SG&A as adjusted to exclude certain expenses we believe areunrelated to our underlying business and that are excluded from our segment profitability measure. Excludingthese adjustments, our SG&A increased €61.7 million. The table below presents SG&A and SG&A excludingadjustments:

Fiscal Year Ended

June 30, 2012July 2, 2011

restated

Change

Actual %

(amounts in millions of euro, except percentages)

SG&A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €898.2 €656.5 €241.8 36.8Adjustments:Restructuring charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57.7 25.2 32.5 129.0Restructuring related . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63.0 7.8 55.2 707.7Termination prior Senseo agreement . . . . . . . . . . . . . . . . . . . . . 55.3 — 55.3 100.0Curtailment and past service costs . . . . . . . . . . . . . . . . . . . . . . . — (13.1) (13.1) (100.0)Impairment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21.3 5.6 15.7 280.4Branded apparel costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.9 3.5 4.4 125.7Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.9 3.0 3.9 130.0

Total adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 212.1 32.0 180.1 562.8

SG&A excluding adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €686.1 €624.4 € 61.7 9.9

The increase in our SG&A excluding adjustments of €61.7 million includes approximately €2.3 millionrelated to favorable foreign exchange impacts. Excluding the impact of foreign exchange rates, the increase was€63.9 million. This increase is primarily due to the impact of absorbing stranded costs and additional costs as aresult of being a stand-alone company. In addition, during the period we increased our advertising and promotioncosts and selling and marketing costs by €17.7 million. The increase in our advertising and promotion costsprimarily related to continued promotion of our single-serve capsules in France and Spain and costs associatedwith launching the single-serve capsules in new markets. The increase in our selling and marketing costs isprimarily related to expanding our selling and marketing function as part of being a stand-alone company.

In fiscal 2011, we had restructuring charges of €25.2 million that primarily related to the alignment ofshared service centers to our current structure, which was partially in response to the divestment of businesses bySara Lee. During fiscal 2012, we had restructuring charges of €57.7 million. The restructuring charge in fiscal2012 includes €25.8 million associated with contractual termination fees for IT contracts that were renegotiatedin connection with the planned separation and the establishment of additional redundancy provisions primarilyrelated to the separation and becoming a stand-alone company.

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The restructuring related expense recorded during fiscal 2012 relates primarily to consulting costsassociated with the planned implementation of our new business model and other incremental costs resultingfrom actions being taken in connection with the separation.

During fiscal 2012, we incurred a €55.3 million contract termination fee to terminate the prior Senseo globalpartnership agreement with Philips and to reimburse Philips for other project costs.

In fiscal 2012, we recognized an impairment charge of €21.3 million which primarily related to the write-offof certain IT software licenses for €13.8 million in connection with IT contract termination. The impairmentcharge also included €5.6 million for machines related to the discontinuation of certain production lines and€1.9 million for our former corporate offices in Utrecht. During fiscal 2011, we elected to abandon certain assetsupon our decision not to expand our operations in Russia, which resulted in an impairment of €5.6 million.

Finance income, net

Finance income increased primarily due to an €11.3 million penalty received from Sara Lee as the result ofan early repayment of a loan receivable, increased pension finance income for the period, and interest earned onloans to Sara Lee.

Finance costs, net

The change in finance costs is primarily due to a shift in our foreign exchange gain/loss from a foreignexchange loss of €40.9 million in fiscal 2011 to a foreign exchange gain of €44.7 million in fiscal 2012. Theforeign exchange gains and losses are primarily related to intercompany loans and cash held in non-eurocurrencies. This was partially offset by a corresponding movement in our foreign currency derivatives from again of €15.5 million in fiscal 2011 to a loss of €5.6 million in fiscal 2012.

Share of profit from associate

Share of profit from associate decreased due to a decrease in Friele’s profits, which was primarily due tolower sales volumes, increased commodity costs, and increased product costs.

Income tax expense

Our effective tax rate increased to 49.1% in fiscal 2012 compared to 29.6% in fiscal 2011. The increase inour effective tax rate was primarily due to higher income tax expense associated with income we intend torepatriate in future periods and an associated increase in our tax liabilities.

Fiscal 2011 Compared Fiscal 2010

Sales

Sales in fiscal 2011 benefited from changes in foreign currency exchange rates, which increased sales by€67.6 million, primarily driven by the Brazilian real and Australian dollar, and from the acquisition of CaféDamasco in fiscal 2011, which increased sales by €23.8 million. These increases were offset by a decline in salesof €34.6 million due to one less week of sales in fiscal 2011.

After excluding the items listed above, our sales increased by €223.1 million. This increase waspredominantly a result of price increases of €201.0 million. These price increases, which took place in allsegments, were directly related to passing on commodity cost increases to customers. The price increases werepartially offset by an increase in trade promotions of €44.5 million, primarily in the retail segments, in responseto increased competition and market pressures. Our sales were also positively impacted by the sales of our L’OREspressO single-serve capsule in our Retail—Western Europe segment, which increased sales by €42.0 million

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in fiscal 2011. These increases were offset by a decrease that was primarily due to lower volume in our multi-serve product that was linked to the continued shift towards premiumization in a significant number of ourmarkets.

In addition, our sales were increased by an additional €109.6 million of green coffee beans sold compared tofiscal 2010 as we took advantage of a system of taxes and rebates payable on trades of green coffee from Brazil.This increase was driven by the increase in overall green coffee market prices and an increased volume of saleswhich we planned for in determining our purchasing volumes. The Brazilian government ended this favorable taxtreatment in January 2012, and we expect that our green coffee export sales will decrease considerably in futureperiods.

Gross profit

Gross profit increased by €16.0 million and our gross margin percentage declined from 41.7% in fiscal 2010to 37.9% in fiscal 2011.

Our gross profit was favorably impacted by foreign currency movements of €28.9 million as well as€6.7 million of gross profit from the Café Damasco acquisition. These increases were partially offset by one lessweek of sales in fiscal 2011, which decreased gross profit by €16.0 million.

Excluding these items, gross profit remained consistent with fiscal 2010, with a decrease of €3.6 million.Our gross profit declined due to commodity price increases of €176.1 million, offset by net sales price increasesof €156.5 million and a further reduction in gross profit due to volume declines. These declines were partiallyoffset by a favorable change in our product mix, primarily related to the launch of our higher margin L’OREspressO capsules and the gross profit of €11.6 million from the increase in our green coffee bean sales.

While our fiscal 2011 gross profit is consistent with fiscal 2010, our gross margin has decreased, primarilyas a result of the green coffee bean sales to third parties which have a lower margin than our normal productsales.

Selling, general and administrative expenses

Our SG&A increased by €32.7 million in fiscal 2011. We have presented SG&A as adjusted to excludecertain expenses we believe are unrelated to our underlying business and that are excluded from our segmentprofitability measure. Excluding these adjustments, our SG&A increased €24.8 million. The table below presentsSG&A and SG&A excluding adjustments:

Fiscal Year Ended

July 2, 2011restated

July 3, 2010restated

Change

Actual %

(amounts in millions of euro, except percentages)

SG&A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €656.4 €623.8 €32.7 5.2

Adjustments:Restructuring charges . . . . . . . . . . . . . . . 25.2 5.4 19.8 366.7Restructuring related . . . . . . . . . . . . . . . . 7.8 9.1 (1.3) (14.3)Curtailment and past service costs . . . . . (13.1) — (13.1) (100.0)Impairment . . . . . . . . . . . . . . . . . . . . . . . 5.6 — 5.6 100.0Branded apparel costs . . . . . . . . . . . . . . . 3.5 7.9 (4.4) (55.7)Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.9 1.8 1.2 66.7

Total adjustments . . . . . . . . . . . . . . . . . . 31.9 24.2 7.8 32.2

SG&A excluding adjustments . . . . . . . . . €624.5 €599.6 €24.8 4.1

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The increase in our SG&A excluding adjustments of €24.8 million includes approximately €12.2 millionrelated to unfavorable foreign exchange impacts. The remaining increase in our SG&A excluding adjustments, of€12.6 million was due to an increase in our distribution costs of €6.0 million. The increase in our distributioncosts is primarily attributable to the increased proportion of our sales from single-serve products, which have ahigher distribution cost per kilogram than multi-serve products, and the impact of our expanded geographicalpresence in Brazil. In addition, we increased our selling, marketing and advertising costs expenditures by€4.4 million to drive sales of our new products and expansion of existing products in certain markets, which waspartially offset by one less week of costs in fiscal 2011.

The increase in our restructuring expenses and costs directly associated with those restructuring chargesduring fiscal 2011 primarily related to redundancy payments made in connection with the alignment of corporateoverhead to our current structure, which was partially in response to the divestment of businesses by Sara Lee.We also elected to abandon certain assets upon our decision not to expand our operations in Russia, whichresulted in an impairment of €4.6 million.

The increase in curtailment and past service cost is primarily due to a change in the grant of post-employment benefits to employees in the Netherlands.

Finance income, net

Finance income increased due to an increase in pension finance income of €19.3 million, which resultedfrom a favorable downward movement in our interest costs due to improved return on assets, as well as anincrease in interest income from loans to Sara Lee.

Finance costs, net

The change in finance costs is primarily due to a shift in our foreign exchange gain/loss from a foreignexchange gain of €40.2 million in fiscal 2010 to a foreign exchange loss of €40.9 million in fiscal 2011. Theforeign exchange gains and losses are primarily related to intercompany loans and cash held in non-eurocurrencies. This was partially offset by a corresponding movement in our foreign currency derivatives from aloss of €9.8 million in fiscal 2010 to a gain of €15.5 million in fiscal 2011. Additionally, we had an increase ininterest expense resulting from additional Brazilian real denominated borrowings associated with the acquisitionof Café Damasco in fiscal 2011.

Share of profit from associate

Share of profit from associate decreased due to a decrease in Friele’s profits. Friele’s operations wereimpacted by the market increase in commodity prices that also impacted our business, which resulted in a declinein gross profit. In addition, they increased marketing and advertising expenditure in an increasingly competitivemarket.

Income tax expense

Our effective tax rate decreased to 29.6% in fiscal 2011 compared to 42.2% in fiscal 2010. The decrease inour rate was due to the recognition of additional tax expense in fiscal 2010 related to specific tax events with nosuch items in fiscal 2011. In fiscal 2010, we recognized €50.8 million of additional tax expense as a result of ourdecision to repatriate certain income that will result in recapture taxes and an increase in our tax reserves of€31.7 million for a tax claim in Belgium. In addition, we recorded additional tax expense associated with achange in tax reserves recorded in prior years of €30.7 million. These increases in fiscal 2010 were partiallyoffset by a reduction in our effective tax rate due to the recognition of deferred tax assets previously notrecognized.

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Segment Results

Retail—Western Europe

Fiscal Year Ended Change

June 30, 2012July 2, 2011

restatedJuly 3, 2010

restated 2012 vs. 20112011 vs. 2010

restated

(amounts in millions of euro, except percentages)

Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €1,264.2 €1,125.3 €1,053.4 €138.9 €71.9Sales growth . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.3% 6.8% n/aAdjusted EBIT . . . . . . . . . . . . . . . . . . . . . . . . . €209.7 €218.1 €253.3 €(8.4) €(35.2)Adjusted EBIT Margin . . . . . . . . . . . . . . . . . . . 16.6% 19.4% 24.0%

Fiscal 2012 Compared Fiscal 2011

Sales

Sales in our Retail—Western Europe segment increased €138.9 million from fiscal 2011 to fiscal 2012. Theincrease was achieved primarily through higher net prices and an increase in our single-serve capsules.

The higher sales prices relate primarily to the full year impact of sales price increases implemented in thesecond half of fiscal 2011 in response to rising commodity costs. In many of our markets, sales price increasesresulted in increased trade promotion activity to respond to the competitive pressure and maintain sales volume.

The increase attributable to single-serve capsules was primarily related to the continued growth in volumeof our single-serve capsules in the Netherlands, France, Spain and Belgium.

These increases were offset by a decrease in sales that was primarily due to a decrease in sales volumes ofmulti-serve products. The volume declines resulted from the discontinuation of our private label multi-servebusiness in France in fiscal 2011 and a continuing shift in sales from multi-serve to single-serve products. Thisshift, combined with sales price increases from rising commodity costs and increased competition, contributed tothe decrease in volumes for multi-serve products during the year.

Adjusted EBIT

Adjusted EBIT decreased €8.4 million from fiscal 2011 to fiscal 2012, which represented an increase in ourgross profit offset by an increase in SG&A. The increase in our gross profit was due to higher net sales prices anda favorable shift in our product mix. This gross profit increase was partially offset by commodity price increasesand by volume declines.

The increase in our SG&A includes an increase in our advertising and promotion costs, which primarilyrelated to the continued promotion of our single serve capsules in the Netherlands and Spain, and an increase inour selling and marketing costs which was primarily related to expanding our outreach as a result of theacquisition of CoffeeCompany. In addition, we experienced an increase in administrative costs resultingprimarily from the impact of absorbing a higher amount of stranded costs, and the impact of being a stand-alonecompany.

Fiscal 2011 Compared to Fiscal 2010

Sales

The increase in sales of €71.9 million was achieved primarily through net price increases and an increase of€42.0 million from a full year impact of our L’OR EspressO single-serve capsules which were launched inFrance in April 2010. These increases were partially offset by one less week of sales in fiscal 2011, whichreduced sales by €18.3 million. The remaining decrease was primarily due to a decrease in sales volumes ofmulti-serve products.

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The increase in sales related to pricing is due to multiple sales price increases that we implementedthroughout fiscal 2011 in response to rising commodity costs. In many of our markets, sales price increasesresulted in increased trade promotion activity to maintain volume.

Throughout the segment, we have also seen a continuing shift in sales from multi-serve to single-serveproducts. This shift, combined with sales price increases from rising commodity costs and increased competition,contributed to the decrease in volumes for multi-serve products during the year. The continued success of L’OREspressO single-serve capsules in France highlights a shift towards premiumization.

Adjusted EBIT

Adjusted EBIT decreased €35.2 million from fiscal 2010 to fiscal 2011. During fiscal 2011, adjusted EBITdeclined due to a decrease in segment gross profit attributable to a one less week in fiscal 2011 of €8.4 million, adecline in multi-serve volume, and commodity price increases that were partially offset by sales price increases.In addition, our adjusted EBIT was negatively impacted by an increase in our production costs. This decline inadjusted EBIT was partially offset by increased sales of our higher margin single-serve capsules.

Retail—Rest of World

Fiscal Year Ended Change

June 30, 2012July 2, 2011

restatedJuly 3, 2010

restated 2012 vs. 20112011 vs. 2010

restated

(amounts in millions of euro, except percentages)

Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €759.6 €647.0 €567.8 €112.6 79.2Sales growth . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.4% 13.5% n/aAdjusted EBIT . . . . . . . . . . . . . . . . . . . . . . . . . . 49.6 45.0 36.3 €4.6 8.7Adjusted EBIT Margin . . . . . . . . . . . . . . . . . . . 6.5% 7.0% 6.4%

Fiscal 2012 Compared Fiscal 2011

Sales

Sales in our Retail—Rest of World segment increased €112.6 million from fiscal 2011 to fiscal 2012. Oursales in fiscal 2012 include €6.0 million of sales from the fiscal 2012 acquisitions and €21.6 million from a fullperiod of results for Café Damasco, which was acquired on November 30, 2010. This increase was partiallyoffset by unfavorable exchange rate impacts of €17.7 million. Excluding the impact of these items, salesincreased by €102.1 million.

Our sales reflect the impact of higher net sales price increases that were primarily implemented in thesecond half of fiscal 2011, which were partly offset by trade promotions. The sales price increases were inresponse to rising commodity costs.

The increase in sales also reflects an increase in volumes in certain markets that was almost fully offset by adecline in volume that resulted from damage to our manufacturing facility in Thailand caused by flooding inOctober 2011. The higher net sales prices were also offset by a slightly unfavorable shift in our product mix.

Adjusted EBIT

Adjusted EBIT increased €4.6 million from fiscal 2011 to fiscal 2012. The change in adjusted EBITincludes an increase of €3.6 million related to the businesses acquired in fiscal 2012 and €5.1 million related to afull year of Café Damasco operations.

Excluding these impacts, adjusted EBIT decreased €4.1 million, which represents an increase in our SG&A,partially offset by an increase in our gross profit. Our gross profit increased due to higher net sales prices offsetby increased commodity costs.

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Our SG&A increased due to an increase in our distribution costs and an increase in selling and marketingcosts as a result of expanding our geographic reach due to our acquisitions. In addition, our administrative costshave increased due to the absorption of a higher amount of stranded costs and general inflationary increases.

Fiscal 2011 Compared to Fiscal 2010

Sales

Sales in our Retail—Rest of World segment increased €79.2 million from fiscal 2010 to fiscal 2011. Oursales in fiscal 2011 benefited from favorable exchange rate impacts of €48.9 million and the acquisition of CaféDamasco, which increased sales €23.8 million. These increases were offset by one less week of sales of €5.6million. Excluding the impact of these items, sales increased by €12.2 million.

This increase of €12.2 million was the result of net sales price increases that were implemented throughoutfiscal 2011 in response to rising commodity costs, which were partially offset by increased trade promotionactivity.

These net sales price increases were offset by various factors including a decrease in volumes in all marketsexcept Thailand and Australia. The volume decreases were most significant in Brazil where the increase in salesprices impacted our volumes more significantly due to competitive pressures. In addition, our sales decreaseddue to our shift in our business model in Russia and an unfavorable shift in our product mix.

Adjusted EBIT

Adjusted EBIT increased €8.7 million from fiscal 2010 to fiscal 2011. The change in adjusted EBITincludes €16.0 million in favorable foreign currency impacts. Excluding the foreign currency impact, adjustedEBIT decreased by €7.3 million due to various offsetting factors.

Our adjusted EBIT increased due to price increases resulting from passing on commodity price increases toour customers. In addition, our adjusted EBIT increased due to a favorable change in our product mix to single-serve capsules and various other factors.

This was offset by increased commodity costs, which were primarily the result of the market increases inprices, a decrease in volumes, and an increase in marketing and advertising costs. The marketing and advertisingincrease is primarily attributable to Brazil where we have increased our spending in response to strongcompetition.

Out of Home

Fiscal Year Ended Change

June 30, 2012July 2, 2011

restatedJuly 3, 2010

restated 2012 vs. 20112011 vs. 2010

restated

(amounts in millions of euro, except percentages)

Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €636.9 €634.4 €613.8 €2.5 €20.6Sales growth . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.4% 3.4% n/aAdjusted EBIT . . . . . . . . . . . . . . . . . . . . . . . . . € 99.8 €109.8 €108.9 €(10.0) € 0.9Adjusted EBIT Margin . . . . . . . . . . . . . . . . . . . 15.7% 17.3% 17.7%

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Fiscal 2012 Compared Fiscal 2011

Sales

Sales in our Out of Home segment increased by €2.5 million from fiscal 2011 to fiscal 2012. The sales,excluding the favorable impact of foreign currency exchange rates of €3.3 million and the impact of the fiscal2012 acquisitions of €3.1 million, decreased by €3.9 million. This decrease in sales of €3.9 million is due to thesales price increases that resulted from passing on higher commodity costs to customers, which were offset by adecline in both our multi-serve and liquid roast coffee products as well as lower machine and operating relatedrevenue.

Adjusted EBIT

Adjusted EBIT decreased €10.0 million in fiscal 2012, primarily due to a decline in our gross profit. Thisdecline in gross profit represents the sales price increases, offset by the commodity price increases and the lowergross profit attributable to our machines and operating business.

Fiscal 2011 Compared to Fiscal 2010

Sales

Sales in our Out of Home segment increased €20.6 million from fiscal 2010 to fiscal 2011 including thefavorable impact of foreign currency exchange rates of €7.8 million. This was offset by one less week of salescompared to fiscal 2010, which resulted in a decrease in sales of €10.7 million.

The increase in sales, excluding the items listed above, was €23.5 million. This increase was predominantlydue to sales price increases that resulted from passing on higher commodity costs to customers, which waspartially offset by a decline in our multi-serve and liquid roast coffee product. The decrease in multi-serve andliquid roast coffee was due in part to the overall weakness in the European economy, which resulted in lowersales of these products to businesses.

Adjusted EBIT

Adjusted EBIT increased €0.9 million in fiscal 2011, which was the result of various offsetting factors.

Our adjusted EBIT increased during the period due to sales price increases along with a decrease in our costof sales and administrative costs. These improvements were almost fully offset by an increase in our commodityprices and a decline in volume of our multi-serve and liquid roast products.

Liquidity and Capital Resources

Our primary source of funds for our short-term and long-term liquidity needs will be the cash flowsgenerated from operations along with borrowings under our 2012 revolving credit facility.

Prior to the separation, we financed our operations through cash flows generated by our operations. We alsoused available cash to provide financing to Sara Lee. We have not historically received any significant financingfrom Sara Lee nor have we participated in any joint borrowings or benefited from borrowings held by Sara Lee.

In connection with the separation, we issued $2.1 billion of debt securities to Sara Lee. Additionally, weentered into a debt exchange with Sara Lee, whereby approximately $1.5 billion of these debt securities weresettled and a corresponding amount of the loans receivable from Sara Lee were settled. Sara Lee transferred theremaining debt securities to a third party in settlement of its own debt obligations.

Furthermore, as part of the separation, we paid a special cash dividend of $3.00 per share to each of ourshareholders of record, as of June 28, 2012. This resulted in a cash payment of approximately $1.8 billion(approximately €1.4 billion).

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In addition, we entered into a €750 million revolving credit facility on May 22, 2012 to provide availableborrowing to fund any short-term working capital requirements. As of the end of fiscal 2012 there are noamounts outstanding under this agreement.

As a consequence of these separation transactions, as of June 30, 2012, our borrowings increased to€557.4 million, our cash and cash equivalents decreased to €220.3 million, our net debt was €337.1 million, andour total current assets was €1.1 billion.

We monitor our liquidity in various ways, including reviewing available cash balances on a daily basis and,on a weekly basis, reviewing short-term cash forecasts obtained from our operating entities. Additionally, wemonitor liquidity using the following cash flow metrics:

Fiscal Year Ended

June 30,2012

July 2, 2011restated

July 3, 2010restated

(amounts in millions of euro, exceptpercentages)

Cash generated from operating activities(a) . . . . . . . . . . . . . . . . . € 102.5 € 281.7 € 364.8Working Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63.6 2,200.6 2,361.4Operating Working Capital(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 405.1 422.8 339.2Operating Working Capital as a percentage of sales(b) . . . . . . . . . 14.5% 16.3% 14.7%Free Cash Flow(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 5.2 € 204.2 € 299.1Net (Debt)/Cash(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (337.1) 979.5 333.0Capital Expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97.3 77.5 65.7

(a) For purposes of periods prior to the spin-off, we have assumed all taxes were settled by Sara Lee, and as aresult there are no cash taxes reflected in our cash generated from operating activities. As a consequence,our future operating cash flows will be reduced by tax payments which are reflected as distributions to SaraLee in financing activities in the statement of cash flows.

(b) These amounts are not measures determined in accordance with IFRS. See “Selected Financial Data” for adefinition of the measure, a reconciliation of the measure to IFRS and a discussion regarding the limitationof the use of such measures.

We expect to finance our obligations through cash on hand, cash flow from operations and borrowingsunder our credit facility. Our principal uses of cash in the future will be to fund our operations, capitalexpenditures, purchase commitments and repayment of borrowings.

Based on our current cash and cash equivalents position, cash flows from operations, and the availability ofborrowings under a €750 million revolving credit facility, we believe that our source of funds will providesufficient liquidity to fund current obligations, expected working capital requirements and capital spending for aperiod that includes the next twelve months.

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Cash Flows

The following table summarizes the changes to cash flows from operating, investing and financingactivities.

Fiscal Year Ended

June 30, 2012July 2, 2011

restatedJuly 3, 2010

restated

(amounts in millions of euro)

Cash provided by (used in):Operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 102.5 €281.7 € 364.8Investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 456.7 70.8 353.8Financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,685.9) 340.2 (564.1)

Effects of exchange rate changes . . . . . . . . . . . . . . . . . . . . . . 2.9 (11.7) 0.4

Net increase (decrease) in cash and cash equivalents . . . . . . €(1,123.8) €681.0 € 154.9

Fiscal 2012 Compared Fiscal 2011

Operating activities

We generated cash flows from operations of €102.5 million in fiscal 2012 compared to €281.7 million infiscal 2011. Cash generated from operations before changes in operating assets and liabilities was €313.3 millionin fiscal 2012 and €466.2 million in fiscal 2011. Cash used to finance working capital increased to €210.9 millionin fiscal 2012 from €184.5 million in fiscal 2011.

Cash used to finance working capital in fiscal 2012 resulted from the increase in trade and other receivables,a decrease in cash from derivative instruments, and the use of cash for payments for pensions and provisions.This was slightly offset by cash inflows resulting from an increase in trade and other payables and a decrease inour inventories. The decrease in our inventories was due to a planned effort to reduce raw materials as a result ofbeing a stand-alone company. The pension payments include one-time payments related to a change in pensionplan terms and the provision payments related to redundancies.

Investing activities

Net cash generated from investing activities increased from €70.8 million in fiscal 2011 to €456.7 million infiscal 2012. This change is primarily due to the net cash inflows related to repayments of loans made to Sara Lee.These net cash inflows were partially offset by the purchase of the Senseo brand from Philips.

Financing activities

Our cash used in financing activities was €1.7 billion in fiscal 2012 compared to cash generated fromfinancing activities of €340.2 million in fiscal 2011. This increase in cash spent on financing activities fromfiscal 2011 to fiscal 2012 primarily relates to various transactions pertaining to our separation from Sara Lee,including the issuance of debt securities for the international coffee and tea business and the payment of the$3.00 per share special cash dividend.

Fiscal 2011 Compared to Fiscal 2010

Operating activities

We generated cash flows from operations of €281.7 million in fiscal 2011 compared to €364.8 million infiscal 2010. Cash generated from operations before changes in operating assets and liabilities was €466.2 millionin fiscal 2011 and €465.9 million in fiscal 2010. Cash used to finance working capital increased to €184.5 million

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in fiscal 2011 from €101.1 million in fiscal 2010. This was primarily due to a significant increase in inventoriesand trade and other receivables, which was partially offset by an increase in trade and other payables and cashgenerated from derivative financial instruments.

These changes in working capital are all directly linked to the higher commodity costs in fiscal 2011 and aproactive extension of payments terms.

Investing activities

Net cash generated from investing activities decreased from €353.8 million in fiscal 2010 to €70.8 million infiscal 2011. This change is primarily due to a higher net increase in loans provided to Sara Lee in fiscal 2010compared to fiscal 2011, offset by cash used to finance the acquisition of Café Damasco in fiscal 2011.

Financing activities

We generated cash from financing activities of €340.2 million in fiscal 2011 compared to cash used infinancing activities of €564.1 million in fiscal 2010. This change is almost entirely a result of a change fromdistributions to Sara Lee in fiscal 2010 of €566.8 million to cash transfers to us from Sara Lee of €342.6 millionin fiscal 2011.

Contractual obligations

The following table summarizes our future contractual obligations as of July 2, 2011. These amounts havenot been adjusted to reflect the impacts of the separation, including any additional borrowings resulting from theseparation.

Total < 1 Year 1 - 3 Years 3 - 5 Years > 5 Years

(amounts in millions of euro)

Borrowings:Senior notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 691.8 € 20.0 € 40.0 € 40.0 €591.8Other borrowings(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . € 204.6 € 28.5 € 5.9 € 1.2 €169.0

Operating lease commitments . . . . . . . . . . . . . . . . . . . . . . . 77.4 18.1 27.7 8.0 23.6Purchase commitments(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 144.2 144.2 — — —UK Pension obligation(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . 260.5 44.4 97.5 61.8 56.8

Total(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,378.5 255.2 171.1 111.0 841.2

(a) The borrowings include future interest payments. The senior notes and a portion of the other borrowings aredenominated in a currency other than the euro. As a result actual payments may differ from these amountsdue to changes in foreign currency rates.

(b) Purchase commitments predominantly consist of commitments related to the purchases of green coffee.

(c) Our defined benefit liability recorded on our balance sheet includes obligations related to pension plans inthe United Kingdom. During fiscal 2006, we entered into an agreement with the plan trustee to fully fundcertain of these United Kingdom pension obligations by 2015. This amount represents the minimumpayments required under these agreements. The final payment will vary based on changes in the actualpension experience. The amounts are payable in British pounds and the actual amounts paid may vary due toexchange rate fluctuations.

(d) This table does not contain normal purchase obligations made in the ordinary course of business. Inaddition, deferred taxes, other non-current liabilities and remaining pension obligations (excluding theminimum United Kingdom pension obligation disclosed above) have been excluded as the timing of thepayments, other than the minimum United Kingdom pension funding, are not fixed. Guarantees are also not

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included as these obligations typically arise as a result of contracts under which we agree to indemnify athird-party against losses arising from a breach of representation and covenants related to matters such astitle to assets sold, collectability of receivables, specified environmental matters, lease obligations assumedand certain tax matters. In each of these matters, payment is conditioned on the other party making a claimpursuant to the procedures specified in the contract and it is therefore not possible to predict the maximumpotential amount of future payments under these agreements.

Quantitative and qualitative disclosures about market risk

Our activities expose us to market risk associated with foreign exchange movements, commodity prices andinterest rate fluctuations. All of these risks arise in the normal course of business. Our overall risk managementprogram focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects onour performance. To mitigate the risk from interest rate, foreign currency exchange rate and commodity pricefluctuations, we use various derivative financial instruments. We do not use financial instruments for tradingpurposes and are not a party to any leveraged derivatives.

Commodity price risk—Commodity price risk arises primarily from transactions on the world commoditymarkets for securing the supply of green coffee beans. Our objective is to minimize the impact of commodityprice fluctuations. The commodity price risk exposure of anticipated future purchases is managed primarily usingderivative futures and options. As a result of our short product business cycle, the majority of the anticipatedfuture raw material transactions outstanding at the balance sheets date are expected to occur in the next year.

We generally enter into commodity futures and options contracts that are traded on established, well-recognized exchanges that offer high liquidity, transparent pricing, daily cash settlement and collateralizationthrough margin requirements.

Foreign exchange risk—We operate internationally and are exposed to foreign exchange risk arising fromvarious currency exposures, primarily with respect to the U.S. dollar, Brazilian real, British pound, Danishkroner, Hungarian forint and Australian dollar against the euro. Foreign exchange risk arises primarily fromcommercial transactions such as the purchase of commodities, recognized monetary assets and liabilities, netinvestments in foreign operations and from foreign currency borrowings.

We use forward exchange and option contracts to reduce the effect of fluctuating foreign currencies onshort-term foreign-currency-denominated intergroup transactions, third-party product-sourcing transactions,foreign-denominated investments (including subsidiary net assets), foreign currency denominated debt and otherknown foreign currency exposures. Gains and losses on the derivative instruments are intended to offset gainsand losses on the associated transaction in an effort to reduce the earnings volatility resulting from fluctuatingforeign currency exchange rates. Forward currency exchange contracts mature at the anticipated cashrequirement date of the associated transaction, generally within 12 to 18 months. As of fiscal 2012, 2011 and2010, we have not designated any of our foreign exchange derivatives as hedges for accounting purposes and, asa result, the change in fair value is recognized directly to the income statements.

Using the exchange rates as of the reporting dates, the net euro equivalent of commitments to purchase andsell foreign currencies is €1.7 billion and €1.7 billion, respectively, as of fiscal year 2012, €1.2 billion and €1.2billion, respectively, as of fiscal year 2011 and €1.1 billion and €1.0 billion, respectively as of fiscal year 2010.We enter into derivative financial instruments to manage the exposure for virtually all foreign exchange riskderived from recorded transactions and firm commitments and anticipated transactions where the exposure ispotentially significant.

Interest rate risk—We are exposed to interest price risk that results from borrowings at fixed rates and theinterest cash flow risk that results from borrowings at variable rates. Prior to our separation from Hillshire, theinterest rate price risk was managed by entering into interest rate swaps to effectively convert its fixed-rated debt

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instruments into floating-rate debt instruments. We have now established a policy under which we assess thecurrent market environment and our leverage ratio in determining the need for interest swaps or hedginginstruments to manage our risk. At end of fiscal 2012 we had primarily fixed rate debt and based on these criteriamade a decision not to enter into any interest rate swaps associated with these borrowings. Subsequent to the endof fiscal 2012, we entered into fixed-to-fixed rate cross currency swaps to effectively convert its fixed rate USDdebt in to fixed rate EUR debt.

Risk management—We maintain risk management control systems to monitor the foreign exchange, interestrate and commodity price risk and our offsetting hedge positions. We utilize a sensitivity analysis technique toevaluate the effect of any changes in interest rate, commodity prices and foreign currencies and the associatedrisk derivatives.

• Commodities—As of fiscal years 2012, 2011 and 2010, if fair value of our commodity derivativeinstruments changed by 10% our profit would have changed by €7.5 million, €4.3 million and€6.1 million, respectively.

• Interest rate swaps—We have minimal exposure to interest rate movements due to the amount ofoutstanding borrowings during the periods presented. We had minimal exposure to interest ratemovements due to the amount of outstanding borrowings throughout fiscal 2012, 2011 and 2010 andthe majority of the outstanding borrowings were at fixed rates during these periods. As noted above, inprior periods we converted our fixed rate third party borrowing into variable rate debt through the useof derivative financial instruments. A 10 basis point change in the fair value of the interest ratederivatives in place during fiscal years 2011 and 2010 would have changed profit by €0.4 million and€0.7 million, respectively.

• Foreign currency—As noted above, we have a foreign currency transaction exposure. We manage thisrisk through the use of derivative financial instruments. During fiscal years 2012, 2011 and 2010, if thefair value of the foreign currency derivatives changed by 10%, our profit for the period would havechanged by €47.1 million, €52.8 million and €23.6 million, respectively. In addition, during fiscal year2011 we had foreign currency options, which if the fair value changed by 10% would have changedprofit by €1.0 million.

Credit risk

Credit risk arises because a counterparty may fail to perform its obligations. We are exposed to credit riskon financial instruments such as cash, derivative assets and trade receivables. We avoid the concentration ofcredit risk on our liquid assets by spreading them over several institutions and sectors.

In relation to derivative financial instruments, we enter into financial instrument agreements only withcounterparties meeting very stringent credit standards (a credit rating of A/A2 or better), limiting the amount ofagreements or contracts it enters into with any one party and, where legally available, executing master nettingagreements. These positions are continually monitored. While we may be exposed to credit losses in the event ofnon-performance by individual counterparties or the entire group of counterparties, we have not recognized anylosses with these counterparties in the past and do not anticipate material losses in the future.

Our derivative instruments are governed by International Swaps and Derivatives Association masteragreements

Our trade receivables are subject to credit limits, controls and approval procedures. Due to the largegeographic base and number of customers, we are not exposed to material concentrations of credit risk on ourtrade receivables. Nevertheless, commercial counterparties are constantly monitored.

The maximum exposure to credit risk resulting from financial activities, without considering nettingagreements and without taking into account any collateral held or other credit enhancements, is equal to thecarrying amount of our financial assets.

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Liquidity risk

Liquidity risk arises when a company encounters difficulties to meet commitments associated with liabilitiesand other payment obligations. Such risk may result from inadequate market depth or disruption or refinancingproblems. Our treasurer has established the liquidity risk management framework for the management of short-,medium- and long-term funding and liquidity management requirements. Liquidity risk is managed bymaintaining adequate reserves and banking facilities and by closely monitoring forecasted and actual cash flowsand, where possible, matching the maturity profiles of financial assets and liabilities. In order to maintainadequate banking facilities, we entered into a revolving credit facility, which will provide available financing tous in future periods.

See Note 3 of our financial statements for further information.

Off-balance sheet transactions

We use customary off-balance sheet arrangements, such as operating leases, guarantees and letters of credit,to finance our business. None of these arrangements has had or is likely to have a material effect on our results ofoperations, financial condition or liquidity.

Research and Development

Our research and development teams are responsible for the technical development of coffee and teabeverage products, packaging systems and new equipment and manufacturing methods. At the core of ourresearch and development capabilities is a team of approximately 125 professionals. Our research anddevelopment facilities are located in Utrecht, the Netherlands.

Our research and development expense for fiscal 2012, 2011 and 2010 was approximately €25 million,€21 million and €18 million, respectively. On average, approximately one-third of our research and developmentbudget is devoted to single-serve product development, one-third to liquid roast and approximately one-third isdevoted to all other categories. In addition to our investments in traditional research and development activitiesand in developing new manufacturing processes, we actively invest in our manufacturing facilities.

Critical accounting policies

Reference is made to Note 4 of the financial statements.

Recent accounting pronouncements

Reference is made to pages F-24 through F-26 of the financial statements.

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ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

The following description sets forth certain information about our management and management-relatedmatters.

Introduction

We have a single-tier board of directors, consisting of executive and non-executive directors. The number ofexecutive and non-executive directors is determined by the board of directors. Our single-tier board structureconsists of one executive director and six non-executive directors, as described below. We intend to nominatetwo additional individuals for election to the board of directors at the next general meeting of shareholders,which would bring the total number of directors to nine. Our sole executive director, Mr. Herkemij, wasappointed as Chief Executive Officer on February 27, 2012.

In the view of the board of directors, all its six non-executive directors are independent within the meaningof best practice provision III.2.2 of the Dutch Corporate Governance Code.

Board of directors

The following table lists the names, positions and ages of the members of our board of directors. Each of ourdirectors have been elected.

Name Position Age

Jan Bennink Non-Executive Chairman 56Michiel J. Herkemij Chief Executive Officer, Executive Director 48Maria Mercedes M. Corrales Non-Executive Director 63Andrea Illy Non-Executive Director 48Cornelis J.A. van Lede Non-Executive Director 69Norman R. Sorensen Non-Executive Director 67Sandra E. Taylor Non-Executive Director 62

The business address of our directors is at our registered offices located at Oosterdoksstraat 80, 1011 DKAmsterdam, the Netherlands.

Senior management

The following table lists the names, positions and ages of the members of our senior management.

Name Position Age

Michel M.G. Cup Chief Financial Officer 43Harm-Jan van Pelt Chief Operating Officer, Retail—Rest of

World 50Nick J. Snow* Chief Operating Officer, Out of Home 48Eugenio Minvielle Chief Operating Officer, Retail—Western

Europe 48

* On September 11, 2012 Nick J. Snow left D.E MASTER BLENDERS.

The business address of all members of our senior management is at our registered offices located atOosterdoksstraat 80, 1011 DK Amsterdam, the Netherlands.

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The principal functions and experience of each of our directors and the members of our senior managementare set out below:

Board of directors

Michiel J. Herkemij

Michiel J. Herkemij, our Chief Executive Officer and chairman of our executive committee, has been ourexecutive director since February 27, 2012. Mr. Herkemij joined the Company as Executive Vice President andChief Executive Officer of the Coffee and Tea (formerly International Beverage) segment on December 1, 2011.Mr. Herkemij joined Sara Lee from Heineken N.V., where he served as President and Chief Executive Officer ofCuauhtémoc Moctezuma in Mexico. Previously, he was Chief Executive Officer of Heineken’s Nigeriansubsidiary, a publicly-listed company. Prior to Heineken, Mr. Herkemij held multiple managerial positions withRoyal Friesland Campina N.V., where he worked in the Benelux region, Greater China and Nigeria. He began hisbusiness career with British American Tobacco in the United Kingdom and Iberia (Spain & Portugal) and ABNAMRO Bank N.V. and previously served as a lieutenant in the Dutch Royal Navy.

Jan Bennink

Jan Bennink has been a non-executive director and our Chairman since February 27, 2012. Mr. Benninkjoined the Company as Executive Chairman of the board of directors of Sara Lee Corporation in January 2011.From 2002 to 2007, Mr. Bennink served as Chief Executive Officer of Royal Numico N.V. (baby food andclinical nutrition). From 1995 to 2002, Mr. Bennink was employed by Groupe Danone (a global producer ofcultured dairy products and bottled water) and served as Senior Vice President and then President of the DairyDivision and member of the Executive Committee. Mr. Bennink has also held management positions withBenckiser GmbH (manufacturer of cleaning supplies and cosmetics) from 1989 to 1995 and with The Procter &Gamble Company (branded consumer goods) from 1982 to 1988. Mr. Bennink currently serves on the board ofdirectors of Coca-Cola Enterprises, Inc. He previously served on the advisory board of ABN AMRO Bank N.V.,as well as on the boards of directors of Boots Company plc, Dalli-Werke GmbH & Co KG, and Kraft Foods, Inc.

Maria Mercedes M. Corrales

Maria Mercedes M. Corrales serves on our board of directors as a non-executive director. Mrs. Corrales servedas Senior Vice President, Starbucks Corporation and President of Starbucks Coffee Asia Pacific Ltd. from 2009 to2010. From 2006 to 2009, Mrs. Corrales was the Representative Director, Chief Executive Officer/Chief OperatingOfficer of Starbucks Coffee Japan. Mrs. Corrales also held a number of management positions with Levi Straussand Co. in her 32-year career with the Company, including Representative Director and President of Levi StraussJapan, Regional Vice President for North Asia and Regional General Manager for South America. Mrs. Corrales iscurrently a non-executive director of Fraser and Neave, Limited, Huhtamaki OYJ and serves on the board and asmember of the executive committee of Times Publishing United. Additionally, Mrs. Corrales has served on theboard of directors of Coffee Concepts Hongkong, Starbucks Coffee South Korea and Starbucks Coffee Malaysia.

Andrea Illy

Andrea Illy serves on our board of directors as a non-executive director. Mr. Illy is Chairman and ChiefExecutive Officer of illycaffè SpA and serves on the board of directors of Gruppo Illy SpA. Mr. Illy has heldthese positions since 2007. Mr. Illy has also held management positions with Ilko Coffee International(Chairman) and Fondazione Altagamma (Vice Chairman). Additionally, Mr. Illy has served on the board ofdirectors of the Association Scientifique Internationale pour le Cafè, Illycaffè Shanghai Co. Ltd., and illy caffèNorth America, Inc.

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Cornelis J.A. van Lede

Cornelis J.A. van Lede serves on our board of directors as a non-executive director and Vice Chairman.Mr. Van Lede is the retired Chairman of the Board of Management and Chief Executive Officer of Akzo NobelN.V. He held these positions from May 1994 to 2003. Mr. Van Lede also held the following managementpositions: Akzo Nobel (member of the Board of Management, Vice Chairman of the Board of Management),Union of Industrial and Employers’ Confederations of Europe (Vice President) and the Federation of NetherlandsIndustry (Chairman). Mr. Van Lede served on the board of directors of Sara Lee since October 2002 and resignedfrom the board of directors of Sara Lee when the separation was completed. He also serves as Chairman of theSupervisory Board of Heineken N.V. and as a member of the Supervisory Board of Royal Philips Electronics. Heis a non-executive director of Air France-KLM Holding and Air Liquide. Mr. Van Lede previously served as anon-executive director of Elsevier Group plc and as a member of the Supervisory Board of Akzo Nobel N.V. andStork B.V.

Norman R. Sorensen

Norman R. Sorensen serves on our board of directors as a non-executive director. Mr. Sorensen served asChairman of Principal International from March 2011 to February 2012 and President, International AssetManagement and Accumulation, of the Principal Financial Group from February 2010 to February 2012, and hecurrently serves as Chairman of the International Advisory Council, as a non-executive director of EncoreCapital Group of the US, and as chairman of the International Insurance Society. He also served as ExecutiveVice President of Principal Financial Group, Inc. and Executive Vice President of Principal Life InsuranceCompany from 2007 to 2012 and as President and Chief Executive Officer of Principal International, Inc. from2001 to 2011. Mr. Sorensen has also held the following management positions: Principal Financial Group, Inc.(Senior Vice President), Principal Life Insurance Company (Senior Vice President) and American InternationalGroup, Inc. (senior executive). He has served on the board of directors of Sara Lee since 2007 from which heresigned upon consummation of the separation.

Sandra E. Taylor

Sandra E. Taylor serves on our board of directors as a non-executive director. Mrs. Taylor is President andChief Executive Officer of Sustainable Business International LLC, a consulting firm specializing in socialresponsibility for global business, which she founded in February 2008. From 2003 to January 2008, Mrs. Taylorserved as Senior Vice President, Corporate Social Responsibility of Starbucks Corporation. Mrs. Taylor has alsoheld management positions with Eastman Kodak Company (Vice President, International Public Affairs), ICIAmericas (Vice President, Public Affairs and Director, Government Relations), and the European CommunityChamber of Commerce, US (Executive Director). From 2006 to 2011, Mrs. Taylor served on the board ofdirectors and the Governance Committee and Compensation Committee of Capella Education Company, Inc.

Senior management

Michel M.G. Cup

Michel M.G. Cup joined Sara Lee as Chief Financial Officer of the Coffee and Tea (formerly InternationalBeverage) segment on December 1, 2011. He continues as the Chief Financial Officer of the Company and as amember of our executive committee. Mr. Cup joined Sara Lee from Dutch-based Provimi, where he was ChiefFinancial Officer and a board member of the Company. Previously, he was Finance Director of Decorative PaintContinental Europe for AkzoNobel NV. Prior to AkzoNobel, he held multiple finance managerial positions,including as Regional Vice President of Finance—Asia/Pacific, with Royal Numico N.V. He began his businesscareer with Deloitte Accountants in the Netherlands.

Harm-Jan van Pelt

Harm-Jan van Pelt joined Sara Lee in 1998, beginning as Marketing Director for Douwe EgbertsNetherlands and working up to his current position as our Chief Operating Officer—Retail—Rest of World.

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Mr. Van Pelt served as a member of the executive committee of Sara Lee’s Coffee and Tea (formerlyInternational Beverage) segment. Mr. Van Pelt joined Sara Lee from Henkel KGaA, where he held variousmarketing and sales positions in Germany and Benelux.

Nick J. Snow

Nick J. Snow serves as Chief Operating Officer—Out of Home and as a member of the executivecommittee. Mr. Snow joined Sara Lee as Senior Vice President of its International Foodservice Segmenteffective January 2006. Mr. Snow joined Sara Lee from JohnsonDiversey, where he was commercial ManagingDirector. Previously, he was commercial Managing Director Australia/Asia for Unilever (Diversey/Lever). OnSeptember 11, 2012 Mr. Snow left D.E MASTER BLENDERS.

Eugenio Minvielle

Eugenio Minvielle currently serves as Chief Operating Officer—Retail—Western Europe and as a memberof the executive committee, both positions he also held at Sara Lee’s Coffee and Tea (formerly InternationalBeverage) segment. Mr. Minvielle joined Sara Lee on June 5, 2012 from Unilever where he served, beginning inApril 2010, as Chief Executive Officer—North America, overseeing Unilever’s operations in the USA, Canadaand the Caribbean. Previously, he was President and Chief Executive Officer of Nestlé France, Mexico andVenezuela. Prior to Nestlé, Mr. Minvielle held a variety of management positions and worked for Procter &Gamble in Spain and Canon in Japan.

During the last five years, none of the members of our board of directors and/or our senior management(1) have been convicted of fraudulent offenses, (2) have served as a director or officer of any entity subject tobankruptcy proceedings, receivership or liquidation or (3) have been subject to any official public incriminationand/or sanctions by statutory or regulatory authorities (including designated professional bodies), ordisqualification by a court from acting as a member of the administrative, management or supervisory body of anissuer or from acting in the management or conduct of the affairs of any issuer.

Board Powers and Function

Under Dutch law, the board of directors is collectively responsible for the general affairs of the company.Pursuant to our Articles, our board of directors may divide its duties among the directors, with the day-to-daymanagement of the Company entrusted to the executive directors. The non-executive directors have the task ofsupervising the executive directors and providing them with advice. In addition, both executive andnon-executive directors must perform such duties as are assigned to them pursuant to our Articles. Each directorhas a duty towards the Company to properly perform the duties assigned to him or her. Furthermore, eachdirector has a duty to act in the corporate interest of the Company. Under Dutch law, the corporate interestextends to the interests of all corporate stakeholders, such as shareholders, creditors, employees and otherstakeholders. The duty to act in the corporate interest also applies in the event of a proposed sale or break-up ofD.E MASTER BLENDERS, whereby the circumstances generally dictate how such duty is to be applied.

Mr. Van Lede, one of the non-executive directors, was appointed as Vice Chairman of the board ofdirectors.

Mr. Sorensen, one of the non-executive directors, was appointed as Senior Independent Director. The dutiesof the Senior Independent Director include acting as the contact for our shareholders with concerns that have notbeen resolved or are not appropriate to be resolved through the normal channels of the Chairman, the ChiefExecutive Officer or the Chief Financial Officer and supervising the evaluation of the performance of theChairman.

Pursuant to Dutch law, an executive director may not be allocated the tasks of (A) serving as chairman ofthe board, (B) fixing the remuneration of the directors or (C) nominating directors for appointment. Nor may anexecutive director participate in the adoption of resolutions (including any deliberations in respect of such

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resolutions) related to the remuneration of executive directors. Tasks that have not been specifically allocated fallwithin the power of the board as a whole. These principles are reflected in our Articles and board rules. Alldirectors remain collectively responsible for proper management regardless of the allocation of tasks.

Board Meetings and Decisions

Pursuant to our board rules, in principle, the board of directors can only adopt resolutions if at least amajority of the directors are present. If possible, resolutions are adopted unanimously. If a unanimous vote is notpossible, a resolution will be adopted by majority vote. In the event of a tie vote, the chairman will cast thedeciding vote.

Pursuant to our board rules, resolutions can also be adopted without holding a meeting, provided that suchresolutions are adopted in writing and all voting directors are in favor of the proposal concerned.

In accordance with Dutch law, our Articles stipulate that the general meeting of shareholders has the right toapprove resolutions of the board of directors with regard to a significant change in our identity or business. Thisincludes: (A) the transfer of all or substantially all of our business to a third party; (B) the entry into ortermination of a long-term cooperation with another legal entity, company or partnership by us or any of oursubsidiaries, or as a fully-liable partner in a limited or general partnership, if such cooperation or termination isof material importance to us; or (C) the acquisition or disposal by us or one of our subsidiaries of a participatinginterest in the capital of a company with a value greater than or equal to one-third of our assets as shown on thebalance sheet included in our most recently adopted annual accounts.

Appointment of directors

Pursuant to our Articles, directors will be appointed at our general meeting of shareholders upon a bindingnomination by the board of directors. A resolution to appoint a director nominated by the board of directors maybe adopted by a simple majority of votes cast. Under our Articles, the board of directors must make a list ofcandidates for each vacancy consisting of at least the number of persons for each vacancy to be filled asprescribed by law (currently two). Pursuant to newly adopted Dutch legislation will enter into effect onJanuary 1, 2013, the requirement that a binding nomination for the appointment of a member of the managementboard or supervisory board of an N.V. or a B.V. consist of at least two persons for each vacancy will beabolished. Our Articles stipulate that the general meeting of shareholders may at all times overrule the bindingnature of such a nomination by a resolution adopted by a simple majority of the votes cast, provided that themajority represents more than one-third of our issued share capital. The board of directors may then make a newbinding nomination, for at least the number of persons required by law, which will be subject to the proceduredescribed above. If a nomination has not been made or has not been made in time, this must be stated in thenotice and the general meeting of shareholders will be free to appoint a director at its discretion. The latterresolution of the general meeting of shareholders must also be adopted by at least a simple majority of the votescast, provided that the majority represents more than one-third of our issued share capital. Additionally, ourboard of directors has the power to make non-binding nominations for directors. Resolutions to appoint a directorby a non-binding nomination of the board are adopted by a simple majority.

Pursuant to newly adopted Dutch legislation will enter into effect on January 1, 2013, the general meeting ofshareholders will also decide whether a director is appointed as an executive or as a non-executive director. Thisprovision has already been implemented in our Articles. In addition, the legal relationship between a director andthe company will not be considered an employment agreement. In the absence of an employment agreement withus, the director will not have certain employee rights under Dutch labor law.

Director Terms

Pursuant to our Articles, the members of our board of directors will serve for a term of one year fromappointment, except that the initial term of our first directors will end on the day of our annual general meeting in2014. The term of office for each director will end when his or her successor is elected and qualified, unless the

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number of directors has been reduced so there is no vacancy on the board of directors, or until his or her earlierdeath, resignation or removal. A director is not available for reappointment if he has been in office for ten years.

Removal of Directors

In accordance with Dutch law, our Articles stipulate that our general meeting of shareholders has theauthority to suspend or remove members of the board of directors at any time, with or without cause, by means ofa resolution for suspension or removal passed by a simple majority of the votes cast, with such votes castrepresenting at least one-third of our issued share capital. Currently, Dutch law does not allow executive directorsto be suspended by the board of directors. Newly adopted Dutch legislation taking effect on January 1, 2013 willallow for executive directors to be suspended by the board of directors. Pursuant to our Articles, our executivedirector can be suspended by the board of directors if permitted by Dutch law.

Director Qualifications

The board of directors seeks to ensure that the board is composed of members whose particular experience,qualifications, attributes and skills, when taken together, will allow the board to satisfy its oversightresponsibilities effectively. More specifically, in identifying candidates for membership of the board, thenomination committee takes into account (1) threshold individual qualifications, such as strength of character,mature judgment and industry knowledge or experience and (2) all other factors it considers appropriate,including alignment with our shareholders. In addition, the board will maintain a formal diversity policygoverning the nomination of its members, as described below.

Under Dutch law and our Articles, executive directors may not serve as the chairman of the board. Inaddition, pursuant to newly adopted Dutch legislation will enter into effect on January 1, 2013, restrictions willapply as to the overall number of board positions that an executive director may hold. Under the new legislation,a person may not be a member of the board if (A) he or she holds more than two supervisory positions with“large companies” as defined under Dutch law, or (B) if he or she acts as chairman of the supervisory board or, inthe case of a one-tier board, serves as chairman of the board of a “large company” as defined under Dutch law.The term “supervisory position” refers to the position of supervisory director, non-executive director or memberof a supervisory body established by the articles of association. Under Dutch law, a “large company” is acompany that meets two of the following criteria, based on its consolidated annual accounts during twosubsequent years: (1) the value of the company’s assets according to its balance sheet is, on the basis of thepurchase price or manufacturing costs, more than €17.5 million; (2) the net turnover is more than €35.0 million;and (3) the average number of employees is 250 or more.

Diversity Policy

We recognize the importance of a diverse composition of our board. The appointment of Mrs. GéraldinePicaud and Mr. Rob Zwartendijk as non-executive members of the board is an agenda item for the generalmeeting in November 2012. After appointment of Mrs. Picaud and Mr. Zwartendijk, the board will consist ofnine members, of which three are women and thus 33.33% of the seats on our board will be held by women.Consequently, D.E MASTER BLENDERS will be fully compliant with the rules described below.

Newly adopted Dutch legislation will enter into effect on January 1, 2013 which will require us to pursue apolicy of having at least 30% of the seats on our board of directors be held by men and at least 30% of the seatson the board of directors be held by women. We will be required to take this allocation of seats into account inconnection with the following actions: (1) the appointment, or nomination for the appointment, of executive andnon-executive directors; (2) drafting the criteria for the size and composition of the board, as well as thedesignation, the appointment, the recommendation and the nomination for appointment of non-executivedirectors; and (3) drafting the criteria for the non-executive directors. Pursuant to the new legislation, should wenot comply with the gender diversity rules, we need to explain in our annual report (1) why the seats are not

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allocated in a well-balanced manner, (2) how we have attempted to achieve a well-balanced allocation and(3) how we aim to achieve a well-balanced allocation in the future. This rule will cease to have effect onJanuary 1, 2016.

Our board regulations include a policy that the board shall aim, to the extent practicable and appropriateunder the circumstances, for a diverse composition of directors in line with the global nature and identity of theCompany and its business, in terms of such factors as nationality, background, gender and age.

We also expect to include a diversity policy in the charter for our nomination committee requiring thecommittee to consider age, gender, nationality, ethnic and racial background in nominating directors. Thecommittee will also be required to review and make recommendations it deems appropriate regarding thecomposition and size of the board of directors to ensure that the board has the requisite expertise and that itsmembership consists of persons with sufficiently diverse and independent backgrounds.

The implementation of these diversity policies will rest primarily with the nomination committee as thebody responsible for identifying individuals believed to be qualified as candidates to serve on the board ofdirectors and recommending that the board nominate the candidates for all directorships to be filled byshareholders at their general meetings.

As board seats become available, the nomination committee, and the board of directors as a whole, will havethe opportunity to assess the effectiveness of the diversity policy and how, if at all, our implementation of thepolicy or the policy itself, should be changed.

Directors’ Insurance and Indemnification

In order to attract and retain qualified and talented persons to serve as members of our board of directors orour senior management, we currently do and expect to continue to provide such persons with protection througha directors’ and officers’ insurance policy. Under this policy, any of our past, present or future directors andmembers of our senior management will be insured against any claim made against any one of them for anywrongful act in their respective capacities.

Unless specifically prohibited by law in a particular circumstance, our Articles require us to reimburse themembers of our board of directors for damages and various costs and expenses related to claims brought againstthem in connection with the exercise of their duties. However, there will be no entitlement to reimbursement ifand to the extent that (1) a Dutch court has established in a final and conclusive decision that the act or the failureto act of the person concerned may be characterized as willful (opzettelijk), intentionally reckless (bewustroekeloos) or seriously culpable (ernstig verwijtbaar) conduct, unless Dutch law provides otherwise or thiswould, in view of the circumstances of the case, be unacceptable according to the standards of reasonablenessand fairness, or (2) the costs or financial loss of the person concerned are covered by insurance and the insurerhas paid out the costs or financial loss.

Executive Committee

Our executive committee was appointed by our Chief Executive Officer and consists of our executivedirector and senior management, as well as our General Counsel, Chief Marketing Officer, Senior VicePresident—Supply Chain Operations and our Senior Vice President—Human Resources.

Powers and function

Our executive committee is entrusted with our day-to-day management. The responsibilities of the executivecommittee include driving our management agenda, managing the performance of our group, assessing andmanaging risks connected with our business activities, realization of our operational and financial objectives,structure and management of our systems of internal controls, maintaining and preparing the financial reportingprocess, compliance with applicable laws and regulations, compliance with and maintaining the corporate

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governance structure of the Company, publication of any information required by applicable laws andregulations, considering the corporate social responsibility issues that are relevant to the Company, and renderingadvice in connection with the nomination of the external accountant of the Company.

The following subjects remain the responsibility of the board of directors, and consequently, resolutions inrespect of such subjects require the approval of the non-executive directors: (1) general policy and strategy;(2) preparation of the annual accounts, the annual budget and significant capital expenditures; (3) issuance ofshares in the Company as well as granting rights to subscribe for shares, to limit or exclude pre-emptive rightswith respect to an issue of shares, to acquire shares by the Company in its own share capital, as well as to disposeof such shares (if and to the extent that the board of directors has been designated by our general meeting ofshareholders as authorized to resolve upon the issue of shares and to limit or exclude pre-emptive rights);(4) issuance of bonds or other debt instruments as well as authorization to enter into medium- and long-termindebtedness; (5) application for quotation or withdrawal of the quotation of the securities in the price list of anystock exchange; (6) transfer of all or substantially all of the enterprise to a third party; (7) the conclusion orcancellation of any long-lasting cooperation by the Company or a subsidiary with any other legal person orCompany or as a fully-liable general partner of a limited partnership or a general partnership, if such cooperationor the cancellation thereof is of essential importance to the Company; (8) acquisition or disposal of aparticipating interest in the capital of a Company with a value of at least one third of the sum of the assetsaccording to the consolidated balance sheet with explanatory notes thereto according to the last adopted annualaccounts of the Company, by the Company or a subsidiary; (9) filing a request for bankruptcy (faillissement) or arequest for suspension of payment of debts (surséance van betaling); and (10) extending guarantees orindemnities to third parties other than those relating to the obligations of subsidiaries of the Company.

Our board of directors also retains the authority to adopt resolutions within the scope of authority of theexecutive committee without the participation of the members of the executive committee who are not alsomembers of the board of directors.

Meetings and Decisions

The executive committee can only adopt resolutions in a meeting of the executive committee where at leastone third of our executive directors is present or represented. Resolutions of the executive committee require amajority vote comprised of the votes of the majority of the executive directors present or represented, includingthe vote of our Chief Executive Officer. If there is a tie, the Chief Executive Officer shall have the deciding vote.Currently, the Chief Executive Officer is our sole executive director.

Appointment and removal of members of our executive committee

The members of our executive committee (with the exception of our Chief Executive Officer) are appointed,suspended and dismissed by the Chief Executive Officer, subject to the approval by the nomination committee.The nomination committee is also required to appoint one of the members of our executive committee as theChief Financial Officer. The members of our executive committee can also be suspended by the board ofdirectors.

Board Committees

While retaining overall responsibilities, our board of directors assigned certain of its responsibilities topermanent committees consisting of directors, and—in relation to the sustainability committee—seniormanagement, appointed by our Chief Executive Officer. Our board of directors has established an auditcommittee, a remuneration committee, a nomination committee and a sustainability committee, each of whichhas the responsibilities and composition described below.

Audit committee

Our audit committee consists of three non-executive, independent members of the board of directorsappointed by the board. They are Mr. Van Lede, Mrs. Corrales and one vacancy. After appointment of

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Mrs. Picaud and Mr. Zwartendijk as non-executive directors by the general meeting of shareholders they will beappointed as members of the audit committee. Upon their appointment, Mrs. Corrales will step down as amember of the audit committee and there will no longer be a vacancy.

Our audit committee supervises and monitors our financial reporting, risk management program andcompliance with relevant legislation and regulations. It oversees the preparation of our financial statements, ourfinancial reporting process, our system of internal business controls and risk management, our internal andexternal audit process and our internal and external auditor’s qualifications, independence and performance. Ouraudit committee also reviews our annual and interim financial statements and other public disclosures, prior topublication. Our audit committee appoints our external auditors, subject to shareholder vote, and oversee thework of the external and internal audit functions, providing compliance oversight, preapproval of all auditengagement fees and terms, preapproval of audit and permitted non-audit services to be provided by the externalauditor, establishing internal auditing policies, discussing the results of the annual audit, critical accountingpolicies, significant financial reporting issues and judgments made in connection with the preparation of thefinancial statements and related matters with the external auditor and reviewing earnings press releases andfinancial information provided to analysts and ratings agencies.

Remuneration committee

Our remuneration committee consists of three non-executive, independent members of the board of directorsappointed by the board. They are Mr. Sorensen, Mrs. Corrales and Mrs. Taylor.

Our remuneration committee is responsible for setting, reviewing and evaluating the remuneration, andrelated performance and objectives, of our executive officers. It is also responsible for recommending to theboard of directors the remuneration package for our Chief Executive Officer, with due observance of theremuneration policy adopted by the general meeting of shareholders. It reviews management services contractsentered into with our Chief Executive Officer and employment agreements with members of our executivecommittee, make recommendations to our board of directors with respect to major employment-related policiesand oversee compliance with our employment and compensation-related disclosure obligations under applicablelaws.

Nomination committee

Our nomination committee consists of three non-executive, independent members of the board of directorsappointed by the board. They are Messrs. Bennink, Van Lede and Sorensen.

Our nomination committee determines selection criteria for members of our board of directors, periodicallyassess the scope and composition of our board of directors and evaluate the performance of our directors.Furthermore, the nomination committee is responsible for approving the appointment, suspension and dismissalof our executive officers by the Chief Executive Officer and is required to appoint one of the executive officersas the Chief Financial Officer.

Sustainability committee

Our sustainability committee consists of our Chief Executive Officer, General Counsel and twonon-executive directors, independent members of the board of directors, Mr. Illy and Mrs. Taylor.

Our sustainability committee evaluates our policies with respect to health, safety, security, environment andsocial responsibility and supervises our policies with respect to health, safety, security, environment and socialresponsibility.

Conflict-of-Interest Transactions

Our Articles provide that a director may not participate in any vote on a subject or transaction if he or shehas a conflict of interest under Dutch law with us or any of our subsidiaries. Our Articles provide that in the

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event that we have a conflict of interest with one or more directors, the Company may still be represented by ourboard of directors. However, under Dutch law, our general meeting of shareholders may resolve at any time todesignate one or more other persons to represent us in the event of a conflict of interest. The rules governing theboard’s principles and best practices contain a similar rule related to executive officers.

Newly adopted Dutch legislation on conflicts of interests taking effect on January 1, 2013 no longercontains restrictions on the powers of directors to represent the Company in case of a conflict, but provides that amember of the board of directors may not participate in the adoption of resolutions (including deliberations inrespect of these) if he or she has a direct or indirect personal conflict of interest with us and our relatedenterprise. If all members of the board of directors have a conflict of interest, the resolution concerned will beadopted by the general meeting of shareholders, unless the articles of association provide otherwise. If anexecutive director or a non-executive director does not comply with the provisions on conflicts of interest, theresolution concerned is subject to nullification (vernietigbaar) and the director concerned may be held liabletowards us.

Except for the duties of members of our board of directors to other entities with which they are affiliatedand which are described in their biographies, and in particular the duties of Mr. Illy to illycaffè SpA and GruppoIlly SpA, which could be considered our competitors, we are not aware of any potential conflicts between anyduties of members of our board of directors and/or our senior management to the Company and their privateinterests and/or other duties. In his agreement for services, Mr. Illy confirmed that he will report any conflict ofinterest as from the date of his appointment to our chairman, with a copy to the corporate secretary. In addition,Mr. Illy will not (i) be involved in or informed of any discussions on possible expansions into Italy and (ii) shareany strategic or commercial information on the Illy Group with us and (iii) share any of D.E MASTERBLENDERS’ confidential information with employees of Illy Group.

Remuneration

Under Dutch law, the general meeting of shareholders must adopt a remuneration policy for the board ofdirectors that addresses the following topics: the fixed and variable components of the remuneration (if any),remuneration in the form of shares and severance payments. On June 28, 2012 our remuneration committeeadopted the remuneration policy for our Chief Executive Officer (being the sole executive director) as developedand approved by the Compensation and Employee Benefits Committee of Sara Lee. The remuneration of ourexecutive directors is determined by our board of directors observing the provisions of our remuneration policy.Executive directors do not vote upon or participate in the discussions of our board of directors on their ownremuneration. The remuneration of non-executive directors is approved by our general meeting of shareholders.Any proposed share or option-based compensation for directors (including the basis for determining anyperformance conditions relating to such compensation) must be submitted by our board of directors to the generalmeeting of shareholders for its approval, detailing the number of shares or options over shares that may beawarded to the directors and the criteria that apply to such award or modification thereof.

Executive director

The table below sets forth the annualized remuneration of our executive director, Mr. Herkemij, for fiscalyear 2012 in gross euro amounts. The terms and conditions of certain of the payments and benefits set forth inthe table and accompanying footnotes below are described in greater detail in the summary of Mr. Herkemij’smanagement services agreement that follows the table.

Name Fixed Fee

VariableCompensation

at 100%1PSUs grant

value2

Pension orsimilarbenefits

Hiringpayment3

PhantomRSU

grant4 Other5

Michiel J. Herkemij . . . . €900,000 €900,000 €1,500,000 €176,004 €600,000 €500,000 €118,745

1. The information in this document is the information available as per June 30, 2012. After June 30, 2012 theactual bonus pay-out over fiscal year 2012 was determined to be 98.42% of the target bonus of €900,000,where the maximum payout was set at 150%, pro-rated from December 1, 2011 up to June 30, 2012.

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2. This grant of performance share units, which we refer to as PSUs, was made in two instalments. One-thirdof the value of the PSU grant, or €500,000, was made by Sara Lee on January 26, 2012. The percentage ofthis first PSU instalment to vest, which has a maximum pay-out of 150% of the granted number of PSUs, isbased on Sara Lee’s actual operating income for fiscal year 2012 and was determined at 80.06% afterJune 30, 2012. The remaining two-third was approved by the Compensation and Employee BenefitsCommittee of Sara Lee and was granted after June 30, 2012. The maximum vesting percentage of thesecond PSU instalment of the award is 200%. Both instalments of the PSU grant for fiscal year 2012 willvest in full in August 2014 if, and to the extent, predetermined performance goals, as described under the2012 Long-Term Incentive Share Plan and as applicable for the second instalment, are achieved.

3. This amount was negotiated and agreed upon by Sara Lee and paid to Mr. Herkemij in connection with hisinitial hiring before the incorporation of D.E MASTER BLENDERS.

4. This grant of RSUs was denominated in Sara Lee common stock and was converted to D.E MASTERBLENDERS ordinary shares following the merger. This grant was a one-time grant negotiated by Sara Leemade to Mr. Herkemij in connection with his initial hiring.

5. The category ‘other’ includes annual fringe benefits (including employer taxes) related to health insurance(€3,073), disability insurance (€29,010), a company car scheme (€39,600), unemployment insurance(€2,331), a representation allowance (€4,080), relocation costs (€22,569) and a relocation allowance(€18,082).

Over fiscal year 2012 no costs were incurred by D.E MASTER BLENDERS on a stand-alone basis. Theannualized remuneration paid to our executive director in fiscal year 2012 is also mentioned in our remunerationreport that will be published on our website.

Management Services Agreement with Michiel J. Herkemij

Mr. Herkemij entered into a management services agreement with Sara Lee pursuant to which Mr. Herkemijserved as Executive Vice President of Sara Lee and Chief Executive Officer of Sara Lee’s Coffee and Tea(formerly International Beverage) segment, and pursuant to which Mr. Herkemij now serves as the ChiefExecutive Officer of D.E MASTER BLENDERS as a result of the assumption of his management servicesagreement; therefore, references to the “Company” in this summary of Mr. Herkemij’s management servicesagreement generally refer to Sara Lee prior to the separation and to D.E MASTER BLENDERS following theseparation. The term of the agreement commenced December 1, 2011, which we refer to as the AgreementCommencement Date and ends November 30, 2015, which we refer to as the Agreement End Date, unless earlierterminated by either party, generally upon six months written notice from the Company and three months writtennotice from Mr. Herkemij, provided that the Company and Mr. Herkemij agree to inform the other no later thansix months prior to the Agreement End Date of their intention to continue the agreement for a definite orindefinite period beyond the Agreement End Date.

Certain terms of Mr. Herkemij’s agreement are set forth in the chart above. Under the agreement, ifMr. Herkemij voluntarily resigns from his employment or if he is terminated for cause, in either case prior to thefirst anniversary of Agreement Commencement Date, he will be required to repay either the net equivalent of thehiring payment or, in the event that the Company cannot recoup certain withholding taxes but Mr. Herkemijcould recoup such taxes, the gross amount of the hiring payment.

As set forth in the chart above, for the Company’s fiscal year 2012, Mr. Herkemij is eligible to participate inthe Annual Incentive Plan for Fiscal Year 2012, which we refer to as the AIP, pro-rated for the portion of theyear Mr. Herkemij is employed by Sara Lee, with a target of 100% of base fee and a maximum of 150% of basefee, based on the operating income, net sales and working capital of the International Beverage business. Anyshort-term incentive plans applicable to Mr. Herkemij are determined by the board of directors of the Company.Furthermore, during each year of his employment until the Agreement End Date, Mr. Herkemij will be entitledannually to a long-term incentive award with a gross value of €1.5 million. Each long-term incentive award will

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be linked to a three-year period and will vest upon the expiration of the three-year period. The grant for the firstperformance period (fiscal years 2012-2014) is detailed in the chart above. If Mr. Herkemij’s employment isterminated by reason other than urgent cause prior to the Agreement End Date, Mr. Herkemij will be entitled toimmediate vesting of his unvested PSUs on a pro rata basis.

If, following a “change in control” (as defined in the addendum to the management services agreement),Mr. Herkemij terminates his management services agreement within three months, or if the Company givesnotice of termination of the management services agreement, provided that such notice is not solely orprincipally due to the acts or omissions of Mr. Herkemij, Mr. Herkemij will be eligible for a severance paymentconsisting of two-and-a-half (2.5) times the base, bonus and pension compensation (as defined in addendum tothe management services agreement). This is in line with the provisions of the Sara Lee Change in Control Planapplicable to Mr. Herkemij when he joined Sara Lee.

Upon expiration of the term of the management services agreement, Mr. Herkemij will be entitled topayment of his base fee for 18 months. If, prior to the expiration of the management services agreement, theCompany terminates Mr. Herkemij’s management services agreement other than for urgent cause orMr. Herkemij terminates the agreement as a result of an urgent cause on the part of the Company, Mr. Herkemijwill be entitled to payment of his base fee for 12 months. However, if Mr. Herkemij terminates his managementservices agreement for any other reason, he is not entitled to any base fee payments.

In addition, for the first 12 months of any permanent and continuous disability of Mr. Herkemij andpotentially for an additional six months of any such disability, the agreement will remain in effect andMr. Herkemij will continue to be entitled to all of the benefits under the agreement. If any such disabilitycontinues for longer than 12 months (unless the period is extended by six months because Mr. Herkemij isexpected to be able to return to performing his tasks without limitation within such six-month period), then theagreement will terminate and Mr. Herkemij will receive continued payment of his base fee for 12 months.Mr. Herkemij also will be entitled to insurance coverage to cover permanent loss of income in an amount equalto his base fee after the second year of permanent and continuous disability. In addition, if Mr. Herkemij dieswhile the agreement is still in effect, his spouse or dependent children will be entitled to continued payment ofhis base fee for the month of his death and for 12 months thereafter, as well as pro rata payments ofMr. Herkemij’s annual and long-term incentive awards and standard maximum payments under the voluntarylife-risk insurance (Overlijdensrisicoverzekering), for which the premiums are paid by Mr. Herkemij.

Mr. Herkemij is subject to certain covenants restricting him from competing in the coffee and tea business,interfering with the business relationships of the Company and from inducing employees to terminate theiremployment with the Company, in each case during and for one year following the termination of hismanagement services agreement.

Non-executive directors

D.E MASTER BLENDERS Remuneration

The non-executive directors who do not chair a committee of the board each receive an annual retainer of€90,000 for their services and non-executive directors who chair a committee receive €110,000 in each case plusa €3,500 travel allowance per meeting for directors who travel transcontinentally to attend the meeting. In eachcase, 25% of each non-executive director’s annual retainer (after taxes) is expected to be invested in shares of theCompany. The chairman of the board receives an annual retainer of €300,000 for his services, 25% (after taxes)of which is expected to be invested in shares of the Company.

Over fiscal year 2012 no costs were incurred by D.E MASTER BLENDERS on a stand-alone basis. Theannualised remuneration paid to our non-executive directors in fiscal year 2012, is also mentioned in ourremuneration report that will be published on our website.

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Sara Lee Compensation

On February 27, 2012, the Corporate Governance, Nominating and Policy Committee of Sara Lee agreed tomake a one-time grant of PSUs to the chairman in his role as Executive Chairman of Sara Lee, which grant wasdocumented at the completion of the spin-off, in shares of the Company and has a target award value of€1.75 million as of the date of grant. This one-time grant was made to help ensure a seamless transition for theCompany and successful implementation of the Company’s strategy as it moved from being a division of SaraLee to being an independent, public company. The number of earned PSUs under the one-time award can varyfrom 0% to 200% and earned PSUs will vest on August 31, 2015. Although this one-time award grant was madeby Sara Lee, the applicable terms are similar to the terms of the 2012 Long-Term Incentive Share Plan, describedbelow.

Senior management

The annualized aggregate remuneration of our senior management for fiscal year 2012 is approximately€5,147,961 (including incentives and benefits), not including any remuneration of our Chief Executive Officer.

Pension, retirement or similar benefits

The annualized total amount set aside or accrued for fiscal year 2012 with respect to pension, retirement orsimilar benefits for our Chief Executive Officer and our other members of senior management is €417,868.

Pension Schemes

We sponsor a number of pension plans around the world to provide retirement benefits. We sponsor definedcontribution plans and defined benefits plans. In addition to contributing to pension plans for our continuingoperations, we have also agreed to retain certain pension liabilities after certain business dispositions werecompleted. The exact amount of cash contributions made to pension plans in any year in any country isdependent upon a number of factors, including minimum funding requirements in the jurisdictions in which weoperate, the tax deductibility of amounts funded and arrangements made with the trustees of certain foreignplans.

Expected contributions to post-employment benefit plans for fiscal year 2013 are approximately€82.1 million for pension benefits. This amount includes approximately €33.4 million related to requiredadditional funding of the Dutch pension plan and normal annual contributions. In addition, we have expectedcontributions of €1.2 million and €0.2 million for the post-employment medical plan and jubilee plan,respectively.

Pension plans in the Netherlands

We currently maintain one pension fund (ondernemingspensioenfonds) in the Netherlands the StichtingDouwe Egberts Pensioenfonds, formerly named Stichting Sara Lee Pensioenfonds Nederland, with plan assets asof July 1, 2012 of approximately €1.4 billion, which we refer to as the Plan. This Plan covers approximately 70%of our employees in the Netherlands. The Plan provides defined benefits based on an average pay system(middelloonregeling) capped at an annual salary of €70,000 per participant and provides defined contributionsabove such amount. As of June 30, 2012, the Plan had a total of approximately 1,507 active participants, 4,111deferred pensioners and 3,917 pensioners. As of July 1, 2012, the defined benefit obligations for the activeparticipants amounted to approximately €318 million, the defined benefit obligations for the deferred pensionersamounted to approximately €427 million and the defined benefit obligations for the pensioners amounted toapproximately €563 million.

A recovery plan is required by the Dutch Central Bank if a plan’s funded status is below its requiredsolvency level of approximately 114% under local funding rules. The recovery plan has a maximum duration of15 years and will end when the coverage ratio of a pension plan is in excess of this required solvency level for 3

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consecutive quarters. The recovery plan has a short term component if a plan’s funded status is below theminimum required solvency level of approximately 104% under local funding rules. This is currently the case forthe Plan. Under the short term part of the recovery plan, additional contributions by the Company equal to thelesser of one third of the deficit or the amount of one year’s regular premium contribution are required. In thiscontext, we made an additional contribution of €25.7 million in fiscal 2012 under the current recovery plan. Theend date of the short term part of the existing recovery plan is December 31, 2013.

In 2011, Sara Lee concluded an amended agreement with the Plan pursuant to which the annualcontributions to the Plan until 2016 will be based on 26% of each participant’s pensionable salary, which iscapped at €70,000 annually per participant. For pensionable salaries in excess of €70,000, a defined contributionplan with age-dependent rates is applicable. As part of this amended agreement, the Company’s contributions aresubject to an overall cap of €75 million per new recovery plan entered into after January 1, 2012.

We also sponsor a defined contribution plan at Delta Lloyd N.V. for certain employees working infoodservices and we participate in an industry-wide pension fund that provides defined contributions for certainemployees employed by us after the acquisition of CoffeeCompany.

Pension plans in the United Kingdom

We sponsor a defined benefit plan in the United Kingdom. The plan consists of five separate benefitsections, each with plan assets that are ring-fenced to fund each section. During 2006, Sara Lee entered into anagreement with the plan trustee that is aimed at fully funding according to the 2005 rules of the PensionProtection Fund (PFF) two of these sections by March 2016. Under the terms of this agreement, Sara Lee hasagreed to make annual pension contributions of 32 million British pounds to these plan sections throughMarch 2016. Subsequent to March 2016, Sara Lee has agreed to keep these sections fully funded in accordancewith local funding standards.

In addition, in 2011 Sara Lee entered into an agreement with the plan trustee to buy-out a section of the planby calendar year 2024. The terms of the agreement require Sara Lee to make annual contributions of 1.6 millionBritish pounds, certain additional contributions in calendar 2014 and 2019, and a final contribution as necessaryto effect a buy-out of the section’s liability in 2024.

The other two sections of the plan are funded in accordance with local funding rules.

As of July 1, 2012, the total assets of the United Kingdom plan were 1,045 million British pounds. The planhad a total of 60 active participants, 7,247 deferred pensioners and 8,873 pensioners. As of July 1, 2012, theaccumulated benefit obligations were 6 million British pounds for active participants, 402 million British poundsfor deferred pensioners and 545 million British pounds for pensioners.

2012 Long-Term Incentive Share Plan

We adopted the 2012 Long-Term Incentive Share Plan. Our Chief Executive Officer, the members of ourexecutive committee, highly compensated executives and, potentially, other key employees designated by theremuneration committee are eligible to participate in the 2012 Long-Term Incentive Share Plan. A performanceshare unit, which we refer to as a PSU, awarded under the 2012 Long-Term Incentive Share Plan is theparticipant’s right to receive a number of shares for no consideration subject to (1) the participant’s continuedservice with the Company or its affiliates and (2) a predetermined performance condition based on our relativetotal shareholder return, which we refer to as “TSR” (as defined in the 2012 Long-Term Incentive Share Plan).

Under the 2012 Long-Term Incentive Share Plan, PSUs will be earned only if the Company achieves certainspecified levels of TSR relative to a comparator group generally over a three-year period commencing on thedate of the award. Reflecting the transitional nature of the fiscal year 2012 award, the performance period willend on August 31, 2014. For PSU grants by D.E MASTER BLENDERS to our executive director an additional

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retention period applies until at least five years after the award date or, if earlier, until termination of theiremployment. The companies in the comparator group are set forth below.

Anheuser-Busch Inbev N.V. Chocoladefabriken Lindt & Sprungli AGHeineken N.V. Nestlé S.A.SABMiller plc Unilever plcDiageo plc Henkel AG & Co. KGaAPernod-Ricard S.A. Procter & GambleRémy Cointreau Reckitt Benckiser plcAssociated British Foods plc Beiersdorf AGGroupe Danone S.A. L’Oreal S.A.H.J. Heinz Company The Coca Cola CompanyKellogg Company PepsiCo Inc.

Depending on the ranking of the Company’s TSR against the TSR of the members of the comparator group,the number of earned PSUs can vary from 0% up to 200% of the number of PSUs granted. The TSR chart setsforth how the number of earned PSUs will be calculated based on the Company’s TSR against the TSRs ofmember companies in the comparator group. For any PSUs to be earned, the performance condition of theCompany’s relative TSR over the performance period must be at least at the median of the TSRs of the membersof the comparator group.

Rank of the Company’s TSR against theTSR of the members of the Comparator

GroupNumber of Earned PSUs expressed as a percentage of

the number of Awarded PSUs

Top 10% or above 200%

Between top 35% and top 10% On a straight-line basis between 100% and 200% based onrankings plus interpolation between intermediate rankings

At top 35% 100%

Between median and top 35% On a straight-line basis between 50% and 100% based onrankings plus interpolation between intermediate rankings

At median 50%

Below median 0%

In the event that a participant ceases active employment with the Company or an affiliate before the vestingdate as specified in respect of any award in the relevant grant notice, some or all of the participant’s PSUs maybe forfeited and the participant’s award(s) may or may not be settled (in shares or cash) as of the date oftermination of employment, depending upon the reason for termination of employment.

Our board of directors may amend the 2012 Long-Term Incentive Share Plan at any time as it deemsnecessary and appropriate. If and to the extent that such amendment adversely affects the rights of anyparticipants with awards outstanding at the time of such amendment, the amendment must be approved by atleast 75% of the relevant participants. This does not limit or preclude in any way the right of the remunerationcommittee to amend the performance conditions if an event has occurred which causes the remunerationcommittee, acting fairly and reasonably, to consider that it would be appropriate to amend the performanceconditions. In making any such amendment, the remuneration committee is required to use reasonable efforts toensure that the amendment does not have a material adverse effect on the awards outstanding at the time of suchamendment.

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The Compensation and Employee Benefits Committee of Sara Lee approved, and the remunerationcommittee of our board of directors has approved on June 28, 2012, an initial grant of PSUs under the 2012Long-Term Incentive Share Plan to members of our senior management, which grants have the following valuesas of the date of grant: Messrs. Herkemij (€1.0 million), Cup (€500,000), Van Pelt (€333,334) and Snow(€280,667). These initial grants were made shortly after completion of the separation.

Annual Incentive Plan

Our executive director, the members of our executive committee and other key employees are eligible forannual bonuses under the AIP. Participants’ awards under the AIP are expressed as a percentage of their basesalary and are based on the achievement of target performance measures. The performance measures under theAIP are based on the Company’s financial and operational targets that are measured over a one-year performanceperiod.

The breakdown of performance measures under the AIP for fiscal year 2012 were:

• Operating Income—40% of target bonus opportunity;

• Net Sales—40% of target bonus opportunity;

• Average Working Capital—20% of target bonus opportunity.

Specific financial goals within each of the performance measures were set by the Compensation andEmployee Benefits Committee of Sara Lee prior to the separation. For fiscal year 2012, the maximum payoutopportunity was 150% of a participant’s target bonus opportunity and threshold payout opportunity is 25% oftarget bonus opportunity. Payout percentages for performance between these performance levels is determined ona straight-line basis. The information in this document is the information available as per June 30, 2012. AfterJune 30, 2012 the actual bonus pay-out over FY12 results was determined to be 98.42% of the target bonus.

Dutch Corporate Governance Code

The Dutch Corporate Governance Code, as revised, became effective on January 1, 2009, and applies to allDutch companies listed on a government-recognized stock exchange, whether in the Netherlands or elsewhere.The Dutch Corporate Governance Code is based on a “comply or explain” principle. Accordingly, companies arerequired to disclose in their annual reports filed in the Netherlands whether or not they are complying with thevarious rules of the Dutch corporate governance code that are addressed to the board of directors and if they donot apply those provisions, to give the reasons for such non-application. The Dutch Corporate Governance Codecontains principles and best practice provisions for the board of directors (executives and non-executives),shareholders and general meetings of shareholders, financial reporting, auditors, disclosure, compliance andenforcement standards.

We acknowledge the importance of good corporate governance. We have reviewed the Dutch CorporateGovernance Code and support the best practice provisions thereof. Therefore, except as noted below or in thecase of any future deviation, subject to explanation at such time, we comply with the applicable best practiceprovisions of the Dutch Corporate Governance Code.

Best practice provision II.1.5 prescribes that the board of directors declares regarding the financial reportingrisks in the annual report that the internal risk management and control systems provide a reasonable assurancethat the financial reporting does not contain any errors of material importance and that the risk management andcontrol systems worked properly in the year under review. In connection with the accounting irregularities andcertain other errors in Brazil, the board of directors cannot give such statement unconditionally.

Best practice provision II.2.8 states that remuneration in the event of dismissal may not exceed one year’ssalary (the “fixed” remuneration component). It is our policy to set the level of severance pay for our directors atno more than one year’s salary, unless the board of directors, at the proposal of the remuneration committee,

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finds this manifestly unreasonable given the circumstances or unless dictated otherwise by applicable law.Considering our Chief Executive Officer’s severance entitlements prior to his engagement with our Company, weagreed to grant him a severance payment of 18 months under certain circumstances, including if his managementservice agreement is terminated due to D.E MASTER BLENDERS not being a listed separate company byDecember 31, 2012, or upon expiration of the term of his management service agreement. In addition, our ChiefExecutive Officer will be entitled to 2.5 times his base, bonus and pension compensation if his managementservices agreement terminates for certain reasons following a change in control and following a regular noticeperiod. This is laid down in the addendum to Mr. Herkemij’s management services agreement and in line withthe provisions of the Sara Lee Change in Control Plan that applied to Mr. Herkemij prior to the separation. Weconsider it manifestly unreasonable to take these entitlements away from him. It has been agreed with our ChiefExecutive Officer that if his management services agreement is renewed after four years his entitlement toseverance in the event of a change in control will be reduced to one year base salary.

The full text of the Dutch Corporate Governance Code can be found onhttps://www.commissiecorporategovernance.nl.

Employees

Our total headcount (measured on the basis of full-time equivalent (“fte”)) was 7,788 as of July 3, 2010,7,508 as of July 2, 2011 and 7,619 as of June 30, 2012. As of June 30, 2012, we had 2,685 employees in salesand marketing, 3,850 in operations and support and 1,084 in general and administration, and 979 in the Retail—Western Europe segment, 2,547 in the Retail—Rest of World segment, 1,930 in the Out of Home segment and2,163 in Other.

Works Council

Koninklijke Douwe Egberts B.V., one of D.E MASTER BLENDERS’ subsidiaries has a works council. Inaddition, we have a European works council. A works council is a body consisting of employee representativeswho have been elected by the employees.

Under Dutch law, a works council has a right to render its advice or, in certain areas, approval onresolutions concerning important matters within the scope of its authority such as intended acquisitions ordivestitures, seeking credit facilities or making capital investments. Failure by us to follow-up the advice opensthe possibility for a works council to appeal to the Enterprise Chamber within one month of written notificationof our decision. During this one month period we must suspend the implementation of the decision.

Shareholdings by directors and senior management

The following tables set forth information with respect to the ownership of D.E MASTER BLENDERS’equity as of June 30, 2012 and as of October 10, 2012 for each of our directors and members of our seniormanagement, and our directors and senior management collectively. See also “Item 4—Information on theCompany—Treatment of Equity-Based Compensation at Separation”.

Beneficial ownership is determined in accordance with rules of the SEC and generally includes any sharesover which a person exercises sole or shared voting and/or investment power. Ordinary shares subject to optionsand warrants currently exercisable or exercisable within 60 days or that vest in connection with the separation aredeemed outstanding for computing the percentage ownership of the person holding the options but are notdeemed outstanding for computing the percentage ownership of any other person. Except as otherwise indicated,we believe the beneficial owners of the ordinary shares listed below, based on information furnished by them,have sole voting and investment power with respect to the number of shares listed opposite their names. None ofthe directors or members of senior management that hold our ordinary shares has any different voting rights thanthe other holders of our ordinary shares.

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Board of directors as per June 30, 2012

Name Directors1Number of Shares

OwnedPerformance Stock

Units2 3Restricted

Stock Units4

ApproximatePercentage of

Class

Jan Bennink5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 235,650 0 0 *Michiel J. Herkemij . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 *Maria Mercedes M. Corrales . . . . . . . . . . . . . . . . 0 0 0 *Andrea Illy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 *Cornelis J.A. van Lede . . . . . . . . . . . . . . . . . . . . . 0 0 0 *Norman R. Sorensen . . . . . . . . . . . . . . . . . . . . . . . 20,562 0 0 *Sandra E. Taylor . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 *

* Less than 1% of the outstanding ordinary shares

1. The address of each of our directors is c/o D.E MASTER BLENDERS, Oosterdoksstraat 80, 1011 DKAmsterdam, the Netherlands.

2. On January 26, 2012, Sara Lee performance stock units (“PSUs”) were granted under Sara Lee’s Plans toMessrs. Bennink (136,933 Sara Lee PSUs) and Herkemij (35,204 Sara Lee PSUs). The number of PSUs wasoriginally in Sara Lee stock and the PSUs have been converted into shares of D.E MASTER BLENDERS.The conversion ratio was based on the Sara Lee stock price on June 27 and 28, 2012 and the D.E MASTERBLENDERS stock price on June 29, 2012 and July 2, 2012. The number of Sara Lee PSUs that will vest canvary from 25% to 150%. Conversion took place after the end of fiscal 2012. The PSUs granted toMr. Herkemij will vest on August 31, 2014 if, and to the extent, predetermined performance goals are met.Of the Sara Lee PSUs granted to Mr. Bennink, one-half vested upon completion of the separation (based onthe agreed conversion ratio (see also “Item 4—Treatment of Equity-Based Compensation in Separation”)and was calculated after the end of fiscal 2012) and vesting was subject to achievement of predeterminedperformance goals. After June 30, 2012, it was determined that the performance goal was achieved for80.06%. In addition, the Compensation and Employee Benefits Committee of Sara Lee approved, and ourremuneration committee approved an initial fiscal year 2012 grant of PSUs under the 2012 Long-TermIncentive Share Plan to Mr. Herkemij (€1,000,000). The number of PSUs to vest pursuant to this initialgrant can vary from 0% to 200% and PSUs will vest on August 31, 2014 if, and to the extent, predeterminedperformance goals, as described under 2012 Long-Term Incentive Share Plan, are achieved. Finally, theCorporate Governance, Nominating and Policy Committee of Sara Lee approved, and our remunerationcommittee approved a one-time grant of PSUs to Mr. Bennink (€1,750,000). The number of PSUs to vestpursuant to this one-time grant can vary from 0% to 200% and PSUs will vest on August 31, 2015.Although this one-time award grant was made by Sara Lee, the applicable terms are similar to the terms ofthe 2012 Long-Term Incentive Share Plan, described above.

3. After June 30, 2012, the remuneration committee granted Mr. Herkemij his annual PSU award (€1,500,000).The number of PSUs to vest pursuant to these grants can vary from 0% to 200% and will vest on August 31,2015 if, and to the extent, predetermined performance goals, as described under 2012 Long-Term IncentiveShare Plan, are achieved.

4. Under Sara Lee’s 1998 Long-Term Incentive Stock Plan, the 2002 Long-Term Incentive Stock Plan and theEmployee Matters Agreement 2012 restricted stock units (“RSUs”) were granted to Messrs. Bennink(136,933 RSUs) and Herkemij (35,204 RSUs). The number of RSUs is in Sara Lee stock and the RSUs hasbeen converted in shares of D.E MASTER BLENDERS. The conversion ratio was based on the Sara Leestock price on June 27 and 28, 2012 and the D.E MASTER BLENDERS stock price on June 29, 2012 andJuly 2, 2012. Conversion took place after the end of fiscal 2012. All of the RSUs granted to Mr. Herkemijand one-half of the RSUs granted to Mr. Bennink, vested upon completion of the separation. See also “Item4—Treatment of Equity-Based Compensation in Separation”. In addition, under Sara Lee’s 1998 Long-Term Incentive Stock Plan, the 2002 Long-Term Incentive Stock Plan and the Employee Matters Agreement2012 RSUs were granted to Messrs. Van Lede (60,441 Sara Lee RSUs) and Sorensen (45,918 Sara Lee

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RSUs). To compensate them for the decrease in value as a result of the Separation, an additional RSU grantwas made by D.E MASTER BLENDERS upon the Separation. The conversion ratio was based on the SaraLee stock price on June 27 and 28, 2012 and the D.E MASTER BLENDERS stock price on June 29, 2012and July 2, 2012. This additional grant was made after the end of fiscal 2012. The RSUs will vest sixmonths after termination of their memberships of the Sara Lee board.

5. Does not include 1,700 shares of common stock held by Mr. Bennink for the benefit of his minor children.

Senior management as per June 30, 2012

Name directors and senior managers6Number of Shares

Owned

PerformanceStock

Units7,8Restricted

Stock Units

ApproximatePercentage of

Class

Michel M.G. Cup . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 *Eugenio Minvielle . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 0 0 *Harm-Jan van Pelt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,666 0 0 *Nick J. Snow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,247 0 0 *

Board of directors and senior management collectively as per June 30, 2012

Directors and senior management as a group(11 people) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 296,125 0 0 *

6. The address of each of the members of senior management is c/o D.E MASTER BLENDERS,Oosterdoksstraat 80, 1011 DK Amsterdam, the Netherlands.

7. On November 4, 2011, Sara Lee performance stock units (PSUs) were granted under Sara Lee’s Plans toMessrs. Van Pelt (12,412 Sara Lee PSUs) and Snow (10,451 Sara Lee PSUs—after June 30, 2012 this grantwas adjusted downwards, see table below). On January 26, 2012, Sara Lee PSUs were granted under SaraLee’s Plans to Mr. Cup (17,602 Sara Lee PSUs). The number of PSUs was originally in Sara Lee stock andthe PSUs have been converted into shares of D.E MASTER BLENDERS. The conversion ratio was basedon the Sara Lee stock price on June 27 and June 28, 2012 and the D.E MASTER BLENDERS stock price onJune 29, 2012 and July 2, 2012. The number of Sara Lee PSUs that will vest can vary from 25% to 150%.Conversion took place after the end of fiscal 2012. All PSUs will vest on August 31, 2014 if, and to theextent, the predetermined performance goals are met. After June 30, 2012, the performance goal wasachieved for 80.06%. In addition, the Compensation and Employee Benefits Committee of Sara Leeapproved, and our remuneration committee approved an initial grant of PSUs under the 2012 Long-TermIncentive Share Plan to Messrs. Cup (€500,000), Van Pelt (€333,334) and Snow (€280,667; after June 30,2012 this grant was cancelled due to the termination of his employment). The number of PSUs to vestpursuant to these initial grants can vary from 0% to 200% and PSUs will vest on August 31, 2014 if, and tothe extent, predetermined performance goals, as described under 2012 Long-Term Incentive Share Plan, areachieved.

8. After June 30, 2012, the remuneration committee has granted their annual PSU award to Messrs. Cup(€1,000,000), Van Pelt (€500,000) and Minvielle (€500,000 plus a one-time sign-on grant of €500,000). Thenumber of PSUs to vest pursuant to these grants can vary from 0% to 200% and will vest on August 31,2015.

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Board of directors as per October 10, 2012

This table shows the numbers of D.E MASTER BLENDERS equity held by the members of the board ofdirectors as filed with the AFM register at the date of this Annual Report.

Name Directors

Number of SharesOwned as a resultof the separation

Number of Sharespurchased until

October 10, 2012

PerformanceStock

Units granted bySara Lee

PerformanceStock

Units granted byD.E MASTERBLENDERS

RestrictedStock Units9

Jan Bennink . . . . . . . . . . . . . . 357,14310 262,956 377,65011 0 0Michiel J. Herkemij . . . . . . . . 37,68512 0 259,597 323,70013 0Maria Mercedes M.

Corrales . . . . . . . . . . . . . . . 0 0 0 0 0Andrea Illy . . . . . . . . . . . . . . . 0 0 0 0 0Cornelis J.A. van Lede . . . . . . 0 0 0 0 70,258Norman R. Sorensen . . . . . . . 20,56214 4,000 0 0 53,376Sandra E. Taylor . . . . . . . . . . 0 0 0 0

9. Reference is made to footnote 4 above.

10. Includes the 235,650 ordinary shares held at June 30, 2012 and the Sara Lee PSUs and RSUs (after taxes)that vested as a result of the separation (121,493). Reference is made to footnote 2 above.

11. The number in the table is the maximum number of PSUs (200%) following the one-time grant by theCorporate Governance, Nominating and Policy Committee of Sara Lee which was documented at thecompletion of the spin-off. The terms of the 2012 Long-Term Incentive Share Plan apply to this award.Reference is made to footnote 2 above.

12. Sara Lee RSUs (after taxes) that vested as a result of the separation. Reference is made to footnote 4 above.

13. The number in the table is the maximum number of PSUs (200%) of the annual D.E MASTER BLENDERSPSU award relating to the September 2012 grant. The terms of the 2012 Long-Term Incentive Share Planapply to this award. Reference is made to footnote 3 above.

14. Ordinary shares held at June 30, 2012.

Senior management as per October 10, 2012

This table shows the numbers of D.E MASTER BLENDERS equity held by senior management as filedwith the AFM register at the date of this Annual Report.

Name Directors

Number of SharesOwned as a resultof the separation

Number of Sharespurchased until

October 10, 2012

Performance StockUnits granted by

Sara Lee15

Performance StockUnits granted byD.E MASTERBLENDERS

RestrictedStock Units

Michel M.G. Cup . . . . . . . 0 10,000 106,078 215,80016 0Eugenio Minvielle . . . . . . 0 0 0 215,80016,17 0Harm-Jan van Pelt . . . . . . 38,666 0 70,718 107,90016 0Nick J. Snow . . . . . . . . . . 1,247 0 0 0 0

15. Not including the Sara Lee PSU grant to Messrs. Cup, Van Pelt, and Snow (see footnote 7 above). Afterconversion of the Sara Lee PSUs into D.E MASTER BLENDERS PSUs and adjustment for the achievementof performance conditions the following numbers of PSUs are held: Cup (23,719), Van Pelt (16,725) andSnow (5,798—this represents the downward adjustment made after June 30, 2012).

16. The numbers in the table are the maximum number of PSUs (200%) achievable under the annual D.EMASTER BLENDERS PSU award relating to the September 2012 grant. The terms of the 2012 Long-TermIncentive Share Plan apply to these awards.

17. Including a one-time sign-on grant.

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ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

7A Major shareholders

The following table sets forth the total number of ordinary shares owned by each shareholder whoseownership of ordinary shares exceeds 5 percent of the ordinary shares issued and outstanding as of July 9,2012. July 9, 2012 was the first day of official trading in our ordinary shares on Euronext Amsterdam.Accordingly, to identify major shareholders for our first Annual Report, we have used this date rather than thedate of the end of the reporting period. The information set out below is solely based on public filings with theNetherlands Authority for the Financial Markets (Stichting Autoriteit Financiële Markten, the “AFM”) as ofJuly 9, 2012.

Greater than 5% Shareholders Date of notification Number of Shares Owned Approximate Percentage

Parentes Holding SE . . . . . . . . . . . . . . . . . . . .Rooseveltplatz 4-5 / Top 10,A-1090 Vienna, Austria

June 29, 20121 0 12.19%*

Donata Holding SE . . . . . . . . . . . . . . . . . . . . .Rooseveltplatz 4-5 / Top 10,A-1090 Vienna, Austria

June 29, 20122 72,515,572* 12.19%

Morgan Stanley Investment . . . . . . . . . . . . . . .Management Inc.

July 4, 2012 31,290,384 5.26%

* Voting interest based on a voting rights agreement.

1. Notification was made for an indirect actual ownership of 12.19% of the voting rights in D.E MASTERBLENDERS.

2. Notification was made for an indirect actual ownership of 72,515,572 D.E MASTER BLENDERS’ ordinaryshares.

From February 27, 2012, the date of our incorporation, until June 28, 2012, the date of the separation, SaraLee held 100% of our issued and outstanding ordinary shares.

Our major shareholders do not have voting rights different from other shareholders.

On October 5, 2012, our shareholders’ register contained 53,725 holders of record resident in the UnitedStates, representing approximately 5.00% of our outstanding shares. Due to the nature of the Dutch centralsecurities depository system through which our shares are settled in the Netherlands, we are unable to verify theresidence of the holders of our outstanding shares, except for the shares held by Donata Holding SE and MorganStanley Investment Management Inc. which have notified their holdings to the AFM.

We are not aware of any arrangement that may, at a subsequent date, result in a change of control.

7B Related party transactions

Agreements with Sara Lee Corporation

As part of the separation, we entered into a master separation agreement and several other agreements toeffect the separation and provide a framework for our relationship with Sara Lee going forward. Theseagreements provide for the allocation between us and Sara Lee of the assets, liabilities and obligations of SaraLee and its subsidiaries, and govern the relationship between us and Sara Lee since the separation.

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In addition to the master separation agreement, the other principal agreements we entered into with Sara Leeinclude:

• a merger agreement;

• a transition services agreement;

• a tax sharing agreement;

• an employee matters agreement; and

• an intellectual property separation agreement.

In the discussion that follows, we have described the material provisions of these agreements with Sara Lee.The summaries of these agreements are qualified in their entirety by reference to the full text of the applicableagreements, which are included as exhibits to this Annual Report. We encourage you to read the full text of thoseagreements. We entered into these agreements prior to the completion of the separation in the context of ourcurrent relationship with Sara Lee. Some of the terms of those agreements may not be the same as those we couldobtain in arm’s-length negotiations with unaffiliated third parties.

Master Separation Agreement

The master separation agreement contains the key provisions relating to the separation, including provisionsrelating to the principal intercompany transactions required to effect the separation, the conditions to theseparation and provisions governing the relationships between Sara Lee and us going forward.

Transfer of Assets and Assumption of Liabilities. The master separation agreement identifies assets andrights to be transferred, liabilities to be assumed and contracts to be assigned between us and Sara Lee as part ofthe separation.

The Distribution. The master separation agreement governs the rights and obligations of the partiesregarding the distribution. Prior to the distribution, the number of shares of DE US, Inc. common stock held bySara Lee was increased to the number of our ordinary shares distributable pursuant to the merger of DE US, Inc.with one of our wholly owned U.S. subsidiaries. Sara Lee then caused its agents to distribute all of the issued andoutstanding shares of DE US, Inc. common stock to the exchange agent who held the shares on behalf of the SaraLee shareholders who hold Sara Lee shares as of the record date.

Releases, Allocation of Liabilities and Indemnification. The master separation agreement provides for a fulland complete release and discharge of all liabilities existing or arising from or based on facts existing prior to theseparation, between or among us, DE US, Inc. or any of our affiliates, and Sara Lee or any of its affiliates (otherthan DE US, Inc.), except as set forth in the master separation agreement.

We are liable for and have agreed to perform all liabilities with respect to our business, which we refer to asthe DE US, Inc. liabilities. Those liabilities include, with certain exceptions, (1) all liabilities of DE US, Inc. andD.E MASTER BLENDERS to the extent based upon or arising out of the DE US, Inc. business and its assets,(2) all liabilities of Sara Lee to the extent based upon or arising out of the DE US, Inc. business and its assets,(3) all liabilities based upon or arising out of financial instruments of DE US, Inc., (4) all outstanding liabilitiesincluded on the DE US, Inc. balance sheet or in the notes thereto and all other liabilities that are of a nature ortype that would have resulted in such liabilities being included as liabilities on a combined balance sheet of DEUS, Inc., or the notes thereto, as of the distribution date (were such balance sheet and notes to be prepared) on abasis consistent with the determination of the nature and type of liabilities included on the DE US, Inc. balancesheet and (5) certain other designated liabilities.

Sara Lee is liable for and agreed to perform all liabilities other than DE US, Inc. liabilities, which we referto as the Sara Lee liabilities.

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In addition, the master separation agreement provides for cross-indemnities principally designed to placefinancial responsibility for the obligations and liabilities of our business and geographic focus with us andfinancial responsibility for the obligations and liabilities of the Sara Lee retained businesses and its geographicfocus with Sara Lee. Specifically, subject to certain exceptions set forth in the master separation agreement, weassumed liability for, and to indemnify and hold harmless Sara Lee, its affiliates (other than DE US, Inc.) and itsdirectors, officers and employees against, certain liabilities relating to our business and the separation, includingall liabilities relating to, arising out of or resulting from:

• the failure by D.E MASTER BLENDERS, DE US, Inc. and its subsidiaries or any other person to pay,perform or otherwise promptly discharge any DE US, Inc. liability;

• any DE US, Inc. liability;

• the performance or breach of any DE US, Inc. contracts or certain designated DE US, Inc. agreements;

• the current or former business and operations of D.E MASTER BLENDERS and DE US, Inc. and itssubsidiaries;

• except for certain Sara Lee-provided information, any claim that the information included in ourregistration statement on Form F-1, this Annual Report or our European Union Listing Prospectus, is orwas false or misleading with respect to any material fact or omits or omitted to state any material factrequired to be stated therein or necessary in order to make the statements therein, in light of thecircumstances under which they were made, not misleading; and

• the breach by us or DE US, Inc. and its subsidiaries of any covenant or agreement set forth in anyagreement entered into in connection with the separation.

Sara Lee agreed to indemnify and hold harmless us, our affiliates and our directors, officers and employeesfrom and against all liabilities relating to, arising out of or resulting from:

• the failure by Sara Lee and its subsidiaries or any other person to pay, perform or otherwise promptlydischarge any Sara Lee liability;

• any Sara Lee liability;

• the performance or breach of certain designated Sara Lee agreements;

• the current or former business or operations of Sara Lee and its subsidiaries;

• solely with respect to certain information supplied by or the responsibility of Sara Lee, any claim thatthe information included in our registration statement on Form F-1, this Annual Report or ourEuropean Union Listing Prospectus, is or was false or misleading with respect to any material fact oromits or omitted to state any material fact required to be stated therein or necessary in order to makethe statements therein, in light of the circumstances under which they were made, not misleading; and

• the breach by Sara Lee or its subsidiaries of any covenant or agreement set forth in any agreemententered into in connection with the separation.

The master separation agreement also establishes procedures with respect to claims subject toindemnification and related matters. Indemnification with respect to taxes and tax matters is governed by the taxsharing agreement and, to a limited extent, the transition services agreement.

Access to Information. The master separation agreement provides that the parties will exchange certaininformation reasonably required to comply with requirements imposed on the requesting party by a governmentauthority, for use in any proceeding or to satisfy audit, accounting or similar requirements, for use incompensation, benefit or welfare plan administration or other bona fide business purposes, or to comply with itsobligations under the master separation agreement or any ancillary agreement. In addition, the parties will use

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commercially reasonable efforts to make available to each other past and present directors, officers, otheremployees and agents as witnesses in any legal, administrative or other proceeding in which the other party maybecome involved.

Expenses. Except as expressly set forth in the master separation agreement or in any related transactionagreement, all third party fees, costs and expenses of Sara Lee, DE US, Inc. or D.E MASTER BLENDERS inconnection with the separation were allocated between Sara Lee, DE US, Inc. and D.E MASTER BLENDERS bySara Lee, in its sole discretion. Each of Sara Lee and D.E MASTER BLENDERS will generally pay its own costsand expenses incurred after the distribution date.

Merger Agreement

The merger agreement governed the merger of DE US, Inc. with and into a wholly owned U.S. subsidiary ofD.E MASTER BLENDERS.

Transition Services Agreement

We entered into a transition services agreement with Sara Lee, which provides for the provision of certaintransitional services principally by Sara Lee to us. The services include the provision of certain applicationmaintenance, application development and infrastructure maintenance services. For these services, the transitionservices agreement generally provides for a term of up to six months, which term may be extended for up to anadditional six months. The transition services agreement also provides for the provision of certain tax supportservices over the course of up to four years, which may be extended with the parties’ consent.

Tax Sharing Agreement

Before the separation, DE US, Inc. entered into a tax sharing agreement with Sara Lee. In general, under thetax sharing agreement, DE US, Inc. is responsible for and must indemnify Sara Lee against (1) allnon-U.S. income taxes attributable to a member of the DE US, Inc. group for all taxable periods, (2) all taxes ofthe DE US, Inc. business following the distribution and (3) tax liability or contractual liability for indemnityobligations relating to taxes in respect of certain dispositions identified in the tax sharing agreement. In general,Sara Lee is responsible for and must indemnify DE US, Inc. against (1) all U.S. federal income taxes relating toSara Lee and its affiliates (including members of the DE US, Inc. group) prior to the distribution, (2) allnon-U.S. income taxes attributable to a member of the Sara Lee group (as determined following the distribution)for all taxable periods, (3) all state and local income taxes relating to Sara Lee and its affiliates (includingmembers of the DE US, Inc. group) prior to the distribution, (4) all taxes of the Sara Lee group (as determinedfollowing the distribution) following the distribution and (5) tax liability or contractual liability for indemnityobligations relating to taxes in respect of certain dispositions identified in the tax sharing agreement.

The tax sharing agreement also separately allocates among the parties any tax liability arising as a result ofany failure of the separation to qualify as a tax-free transaction to Sara Lee and DE US, Inc.. Under the taxsharing agreement, DE US, Inc. is required to indemnify Sara Lee and its affiliates against all tax-relatedliabilities caused by the failure of the distribution to qualify as tax-free (including as a result of Section 355(e) ofthe Code) to the extent these liabilities arise as a result of any action (or failure to act) of DE US, Inc. or any ofits affiliates, including the Company, following the distribution or otherwise result from any breach of certainrepresentations, covenants or obligations of DE US, Inc. or any of its affiliates, including the Company,concerning a party’s plan or intention with respect to actions or operations after the distribution date. In addition,DE US, Inc. is responsible for 50% of any taxes resulting from the failure of the distribution and certain relatedtransactions, including the debt exchange, to qualify as tax-free, which failure is (1) not due to the actions,misrepresentations or omission of Sara Lee or DE US, Inc. or their respective affiliates or (2) due to an action (orfailure to act), misrepresentation or omission of Sara Lee, DE US, Inc. or their respective affiliates prior to thedate of the distribution not concerning a party’s plan or intention with respect to actions or operations after thedistribution date.

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Employee Matters Agreement

We entered into an employee matters agreement with Sara Lee providing for our respective obligations toemployees and former employees who are or were associated with DE US, Inc. and its subsidiaries (includingthose employees who transfer employment from Sara Lee to DE US, Inc. and its subsidiaries in connection withthe separation) and for other employment and employee benefits matters.

The treatment of outstanding Sara Lee equity awards in connection with the distribution is set forth in theemployee matters agreement and is described above in “Treatment of Equity-Based Compensation” under Item 4.

In addition, the employee matters agreement sets forth the following:

• Following the distribution, DE US, Inc. Employees are generally only eligible to participate in DEUS, Inc. benefit plans and DE US, Inc. has no liability under any Sara Lee benefit plan. DE US, Inc.and Sara Lee will take all actions necessary or appropriate to ensure that DE US, Inc. will not have anyliability under any Sara Lee benefit plan. DE US, Inc. will assume, pay, perform and fulfill allliabilities relating to past, current or future employment with the DE US, Inc. business.

• Following the distribution, Remaining Employees are generally only eligible to participate in Sara Leebenefit plans and Sara Lee has no liability under any DE US, Inc. benefit plan. DE US, Inc. and SaraLee will take all actions necessary or appropriate to ensure that Sara Lee will not have any liabilityunder any Sara Lee benefit plan. Sara Lee will assume, pay, perform and fulfill all liabilities relating topast, current or future employment with the Sara Lee business.

Intellectual Property Separation Agreement

We entered into an intellectual property separation agreement with Sara Lee providing for the division ofcertain intellectual property between us and Sara Lee.

Trademark and Corporate Name Licenses. Sara Lee granted to us a limited, non-exclusive license to usecertain of its trademarks for a term commencing on the distribution date and ending on January 1, 2014. Thistrademark license will automatically terminate with respect to our rights to use such licensed trademarks, uponour failure to cure any material breach of the terms of the trademark license within 30 days after the receipt ofwritten notice of such material breach from Sara Lee. Sara Lee also granted to us a non-exclusive license tocontinue to use certain Sara Lee trademarks as part of our and our subsidiaries’ corporate names for a termbeginning on the distribution date and ending no earlier than January 1, 2014. With respect to product packagingthat includes such corporate names, we may continue to use such product packaging until July 31, 2015, and,with respect to any of our entities undergoing liquidation prior to January 1, 2014 and which include licensedcorporate names, we may continue to use such corporate names while pursuing completion of such liquidation.Sara Lee will remain the sole and exclusive owner of all right, title and interest in and to its trademarks.

Debt Exchange

On May 15, 2012, Sara Lee entered into a note purchase agreement by and among Sara Lee and a group ofinstitutional investors as described in further detail in “Description of Certain Indebtedness—Note Purchase andGuarantee Deed.” The note purchase agreement relates to the private placement of $650 million aggregateprincipal amount of indebtedness by Sara Lee through a series of notes, which we refer to as the new Sara Leenotes. In connection with the contribution of Sara Lee’s international coffee and tea businesses to DE US, Inc.,Sara Lee received approximately $2.1 billion principal amount of DE US, Inc. debt securities, which areguaranteed by the Company. In connection with the distribution and in accordance with the terms of the new SaraLee notes, Sara Lee satisfied its obligations under the new Sara Lee notes by transferring a portion of such DEUS, Inc. debt securities to the holders of the new Sara Lee notes. Such DE US, Inc. securities were issuedpursuant to the note purchase and guarantee deed described in “Description of Certain Indebtedness—NotePurchase and Guarantee Deed.” The new Sara Lee notes have subsequently been cancelled. Sara Lee transferred

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the remaining DE US, Inc. debt securities to certain subsidiaries of DE US, Inc. in satisfaction of Sara Lee’s debtobligations to such subsidiaries of DE US, Inc.. The 3.18% DE US, Inc. debt securities that Sara Lee transferredto certain subsidiaries of DE US, Inc. are due June 15, 2019 but otherwise have substantially the same terms asthe DE US, Inc. notes issued pursuant to the note purchase and guarantee deed and that our guarantee obligationsin respect of such DE US, Inc. debt securities are substantially identical. For a description of the note purchaseand guarantee deed, see the section of this Annual Report entitled “Description of Certain Indebtedness—NotePurchase and Guarantee Deed” under Item 10B.

Agreements with members of our senior management

See “Management and Employees—Compensation—Management Services Agreement with Michiel J.Herkemij” under Item 6.

We did not grant any personal loans, guarantees or the like to members of our Board nor to seniormanagement.

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ITEM 8. FINANCIAL INFORMATION

8A Consolidated Statements and Other Financial Information

This Annual Report contains the audited consolidated financial statements of D.E MASTER BLENDERSfor the fiscal year ended June 30, 2012. The consolidated financial statements in Item 18 of this Annual Reportcontain a Report of Independent Registered Public Accounting Firm dated October 11, 2012, balance sheets as atJune 30, 2012, July 2, 2011 and July 3, 2010, consolidated income statements for the three years ended June 30,2012, July 2, 2011 and July 3, 2010, respectively, consolidated statement of changes in equity for the three yearsended June 30, 2012, July 2, 2011 and July 3, 2010, respectively, consolidated cash flow statements for the threeyears ended June 30, 2012, July 2, 2011 and July 3, 2010, respectively, and notes to the financial statements.

Legal Proceedings

The following potential liabilities of D.E MASTER BLENDERS include liabilities assumed in connectionwith the separation.

Sara Lee is involved in several legal proceedings relating to its manufacture and sale of L’OR EspressO/L’aRôme EspressO capsules. In June 2010, Nestec/Nespresso, which we refer to as Nestlé, filed a suit againstSara Lee Coffee and Tea France alleging patent infringement related to Sara Lee’s sale and distribution ofespresso capsules. On January 19, 2011, Nestlé filed a similar suit against Sara Lee Coffee and Tea in theNetherlands after Sara Lee began selling espresso capsules in that country. In June 2011, Nestlé filed a similarsuit against Sara Lee Coffee and Tea Belgium. Prior to this suit, on May 11, 2011, Sara Lee Coffee and TeaBelgium served a writ of summons on Nestlé seeking a declaration of non-infringement in connection with SaraLee’s sale and distribution of espresso capsules in Belgium. In October of 2011, Nestlé requested preliminaryinjunctions against Sara Lee Coffee and Tea Belgium, seeking prohibition of Sara Lee’s sale and distribution ofespresso capsules in Belgium, and the request for preliminary injunctions was denied without prejudice toNestlé’s claims. In February 2012, Nestlé appealed the decision to reject the preliminary injunctions. In February2012, Nestlé filed a similar claim against Sara Lee Coffee and Tea in Spain. All of these proceedings relate to thealleged infringement of two or three European patents granted to Nestlé. In addition, in Spain, Nestlé sued fortrademark infringement and unfair competition. In the lawsuit filed in France, Nestlé claims damages in theamount of €50 million for each claimant. If we are held to infringe any of the invoked patents, the court maydetermine a reasonable provisional damages amount and deposit by Sara Lee. Any damages would be establishedin separate damage assessment proceedings. Management believes that the patents and trademarks granted toNestlé are not being infringed and further believes that the patents are invalid and that the Company has notengaged in unfair competitive practices. We are vigorously contesting Nestlé’s allegations.

In October 2009, the Spanish tax administration upheld a challenge made by its local field examinationagainst tax positions taken by our Spanish subsidiaries. In November 2009, we filed an appeal against this claimwith the Spanish Tax Court. In April 2010, the Spanish Chief Inspector upheld a portion of the claim raised bythe Spanish tax authorities. We appealed to the Tribunal Economico Administrativo Central, which we refer to asthe TEAC. At the end of March 2012, the TEAC ruled in favor of the Tax Administration with respect to theaudit for fiscal years 2003-2005. We continue to dispute the challenge and will continue to have furtherproceedings with the Spanish tax authorities regarding the issue. At fiscal 2012 year end, the matter is now at thelevel of the National Appellate Court (Audiencia Nacional).

In June 2011, the Spanish tax administration’s local field office examination made similar challengesagainst tax positions for the years ending July 1, 2006 to June 27, 2009 taken by our Spanish subsidiaries. Wefiled an appeal against this claim with the Spanish Tax Court (TEAC).

In August 2011, the Italian Provincial Tax Commission upheld a challenge made by its local fieldexamination against a loss claimed in the fiscal year 2004 tax return of our Italian subsidiaries. Subsequentlyfiscal years 2003 and 2005 have also been partially reassessed on Net Operating Losses as a consequence of the

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challenge with regard to fiscal year 2004. The Company has filed the corresponding appeals for all thosefinancial years with the litigation being now conducted at the level of the Italian Regional Tax Commission(2nd Grade tax court). We continue to dispute the challenge and we expect to prevail in further proceedings withthe Italian tax authorities regarding the issue.

In connection with the sale of its household and body care business, Sara Lee agreed to arrange for thetransfer of certain trademark registrations in the Middle East from a third party licensee to the buyers of thehousehold and body care business. Until year end fiscal 2012, the third party licensee has refused to cooperatewith these transfers despite contractual commitments to do so as a result of which we are in default under thedivestment agreement. We are preparing legal action in order to effectuate the transfer of these rights to thebuyers. In the meantime, on August 28, 2012, one of the buyers of the household and bodycare business broughton a claim against D.E MASTER BLENDERS before the High Court in London requesting specific performanceunder the divestment agreement. On September 27, 2012, we submitted our response to this claim.

In the fiscal year 2012 Sara Lee Cafés do Brasil Ltda initiated court proceedings in Brazil to contest a taxassessment raised with regard to fiscal year 2006. Part of the adjustments relate to the disallowance of goodwilldepreciation which Sara Lee Cafés do Brasil Ltda successfully litigated in prior years (unanimous decision by theCourt in favor of Sara Lee Cafés do Brasil Ltda. The appeal on this decision by the Brazilian tax authorities inearly 2010, to date, has not been accepted by the Court). In addition to this matter, the Brazilian tax authoritiesalso assessed Sara Lee Cafés do Brasil Ltda on allegedly incorrect documented returned sales.

On August 31, 2012 our Brazilian unit received a notification from the Federal Tax Authorities in Brazilregarding an investigation by these authorities into green coffee trading activities in the Brazilian market. Thisinvestigation focuses on the legitimacy of the tax credit facilities applied on green coffee trading activities over aperiod from 2006-2009. We are currently reviewing the notification and carrying out our own investigation. Evenif the facts support our position, there can be no assurance that we will prevail if the federal tax authorities ofBrazil elect to challenge our position in court.

The Association of Securities holders (Vereniging van Effectenbezitters or VEB), a Dutch associationrepresenting interests of investors, has written to us in connection with the accounting irregularities in Brazil. Inits letter, the VEB expresses the view that these irregularities should have been disclosed in the prospectus thatwas published at the time of the separation from Sara Lee. The VEB alleges that the non-disclosure in theprospectus has harmed certain unnamed shareholders of the Company. The VEB states that it does not excludeinitiating litigation if it cannot reach an amicable arrangement with us on this issue. The VEB has not specifiedthe amount of damages that it is seeking from us. We disagree with the VEB. We believe the prospectus wasprepared in accordance with the required standards of care and that we are not liable for any damages caused.

Competition authorities in various European countries and the European Commission have initiatedinvestigations into the conduct of consumer product companies, including the former household and body carebusiness of Sara Lee, the liabilities of which we assumed as part of the separation. These investigations usuallycontinue for several years and, if violations are found, may result in substantial fines. Other than as indicatedhereafter with respect to the Belgian Competition Authorities, no formal charges have been brought against SaraLee or us to date concerning the substantive conduct that is the subject of these investigations. On October 1,2012, we received a statement of objections from the Belgian Competition Authorities regarding allegedanti-competitive behavior by the former household and body care business of Sara Lee. We are currentlyreviewing the statement of objections and will respond to the statement of objections as requested by the BelgianCompetition Authorities. Our practice is to comply with all laws and regulations applicable to its business,including the antitrust laws, and to cooperate with relevant regulatory authorities.

Dividend policy

Our general dividend policy is determined by our board of directors and will be discussed with ourshareholders at our annual general meeting of shareholders. Within the general dividend policy, our board of

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directors will determine to what extent profits will be retained by way of a reserve. In making this determination,the board will consider our ability to declare and pay dividends in light of our future operations and earnings,capital expenditure requirements, general financial conditions, legal and contractual restrictions and other factorsthat it may deem relevant. In addition, the terms of our outstanding indebtedness may limit our ability to paydividends and we may in the future become subject to debt instruments or other agreements that further limit ourability to pay dividends. Any profits unallocated to the reserves by the board of directors will be at the disposalof our general meeting of shareholders for distribution as a dividend or to be added to the reserves or for suchother purposes as our general meeting of shareholders decides. By 2015, we intend (subject to shareholderapproval and any contractual restrictions on our payment of dividends) to have a dividend payout ratio of around30%. We define dividend payout ratio as the percentage of our underlying profit paid to shareholders individends. To the extent we pay dividends in euro, the amount of U.S. dollars realized by shareholders will varydepending on the rate of exchange between U.S. dollars and euro. Shareholders will bear any costs related to theconversion of euro into U.S. dollars. We are a holding company incorporated in the Netherlands. Under Dutchlaw, we may only pay dividends if our equity exceeds the sum of the paid-in and called-up share capital plus thereserves as required to be maintained by Dutch law or by our Articles. See “Dividends and Distributions” inItem 10B. We rely on dividends paid to us by our subsidiaries to fund the payment of dividends, if any, to ourshareholders.

8B Significant Changes

In connection with our first year-end closing process as an independent company, we identified accountingirregularities and certain other errors related to the previously reported historical financial statements. The errors,which all involve our Brazilian operations, were caused by accounting irregularities and certain other errors thathave caused our Company to take certain provisions, including tax provisions, and restate our historical financialstatements. The accounting irregularities were the subject of an independent investigation into the Brazilianoperations performed by outside legal counsel and independent forensic accountants. The accountingirregularities identified included the overstatement of accounts receivable due to the failure to write-offuncollectible customer discounts, improper recognition of sales revenues prior to shipments to customers, theunderstatement of provisions for various litigation issues, unsupported expense reversals and postponements,moving inventory out of warehouses that were about to be verified by internal and external auditors, the failure towrite-off obsolete inventory, and other inventory valuation issues. These accounting irregularities resulted froman ineffective control environment over financial reporting maintained by management in Brazil which beganprior to 2009 through 2012 that permitted to go undetected intentional overrides of internal controls as well ascross-functional collusion by management in Brazil and communication and actions by senior management inBrazil that contributed to a lack of adherence to existing internal control procedures and IFRS. The investigationdid not find evidence that these practices spread to operations outside of Brazil.

Based on the results of the investigation, we have taken appropriate action to reinforce and enhance theinternal control over financial reporting and governance procedures in our Brazilian operations. These remedialactions included making appropriate changes in the Brazilian management and finance teams, includingreplacing the chief executive officer, the chief financial officer and the local controller who are no longeremployed by us, adopting enhanced internal audit procedures with respect to the Brazilian operations reviewingreporting lines, strengthening the Global Business Practices function in Brazil, and providing additionalcompliance and business ethics training to relevant departments and employees.

The accountant irregularities and certain other errors reduced parent’s net investment by €22 million for thefiscal year 2011 and the impact to the first half of fiscal year 2012 is insignificant. See Note 1 of our financialstatements for more detail on the impact of these adjustments. These adjustments are not expected to affect theCompany’s financial performance in fiscal year 2013.

For events occurred after June 30, 2012, reference is made to pages F-73 through F-74 of our financialstatements.

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ITEM 9. THE OFFER AND LISTING

9A Offer and listing details

The principal market for our ordinary shares is Euronext Amsterdam.

Because we were previously a private limited liability company (besloten vennootschap met beperkteaansprakelijkheid) without a public market for our ordinary shares before the separation, there is no historicaltrading data for our ordinary shares, which began officially trading on NYSE Euronext Amsterdam on July 9,2012, and since June 12, 2012 on an “as-if-and-when-issued/delivered” basis. The table below sets forth, for thecalendar periods indicated, the high and low sales prices of our ordinary shares on Euronext Amsterdam asreported by NYSE Euronext and is based on closing prices.

Euronext Amsterdam*

(euro)

High Low

2012June 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 9.24 €7.75July 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €10.78 €8.68August 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 9.85 €8.73September 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 9.67 €9.21October 2012 (through October 5, 2012) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 9.60 €9.26

* The “As If When Issued” trading period runs from June 12, 2012 through July 6, 2012. The official listingstarted as of July 9, 2012.

9B Plan of distribution

Not applicable

9C Markets

Please see Items 4 and 9A above

9D Selling shareholders

Not applicable

9E Dilution

Not applicable

9F Expenses of the issue

Not applicable

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ITEM 10. ADDITIONAL INFORMATION

10A Share capital

Not applicable

10B Memorandum and articles of incorporation

The following summary of the material terms of our share capital is qualified in all respects by reference toour Articles, which have been filed as an exhibit to the F-1. The information set forth under the followingheadings of D.E MASTER BLENDERS’ F-1, as amended, filed with the SEC is incorporated by reference:

• “Conflict-of-Interest Transactions” under “Management and Employees”

• Exhibit 3.2

The following is a description of the material terms of our Articles and board regulations as each isanticipated to be in effect upon our conversion.

Incorporation and Registered Office

We were incorporated on February 27, 2012 as a private company with limited liability (beslotenvennootschap met beperkte aansprakelijkheid), by Sara Lee International B.V., a private company with limitedliability (besloten vennootschap met beperkte aansprakelijkheid) having its corporate seat in Joure (Skasterlân),the Netherlands and its business address at Vleutensevaart 100, 3532 AD Utrecht, the Netherlands. Prior to thecompletion of the separation, we converted into a Dutch public company with limited liability (naamlozevennootschap) incorporated under the laws of the Netherlands and amended our articles of association onJune 21, 2012, to change our name to D.E MASTER BLENDERS 1753 N.V.

Our corporate seat is now in Joure (Skasterlân) the Netherlands. We are registered with the Trade Registerof the Chamber of Commerce in Amsterdam under number 54760968. Our executive offices are located atOosterdoksstraat 80, 1011 DK Amsterdam, the Netherlands. Our telephone number is +31 20-558-1753.

Share Capital

At the date of this Annual Report, our authorized share capital amounts to €356,915,564.14 and is dividedinto 2,974,296,370 ordinary shares, each with a nominal value of €0.12. Our issued share capital at the date ofthis Annual Report amounts to €71,383,112.88. All of the issued ordinary shares have been created under Dutchlaw and were fully paid up by a contribution in kind of all the shares in DE US, Inc. after the merger of DE US,Inc. with a wholly owned U.S. subsidiary of D.E MASTER BLENDERS. Each share confers the right to cast onevote. Under Dutch law, our authorized share capital is the maximum capital that we may issue without amendingour Articles. An amendment of our Articles would require shareholder approval upon proposal by the board ofdirectors.

Articles of Association and Dutch Law

Set forth below is a summary of relevant information concerning our share capital and material provisionsof our Articles and applicable Dutch law. This summary does not constitute legal advice regarding those mattersand should not be regarded as such.

Corporate Purpose

Pursuant to Article 2 of our Articles, our corporate purpose is: the sale, purchase, manufacturing, packagingand trading of coffee, tea, beverages and other related products, including but not limited to the processing of

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coffee beans into coffee and related products, as well as to participate in, to take an interest in any other way in,to conduct the management of other business enterprises of whatever nature, to provide services to other businessenterprises of whatever nature, to finance third parties, in any way to provide security or undertake theobligations of third parties and finally all activities which are incidental to or which may be conducive to any ofthe foregoing.

Issue of Ordinary Shares

Our board of directors has been designated in our Articles as the corporate body competent to issue ordinaryshares and to grant rights to subscribe for ordinary shares, limited to the amount of our authorized share capitalfrom time to time. Our board of directors is authorized to issue ordinary shares and grant rights to acquireordinary shares until July 1, 2014. A designation as referred to above will only be valid for a specific period of nomore than five years and may from time to time be extended for a period of no more than five years.

If not otherwise stated in the resolution approving the designation, such designation is irrevocable. Theresolution designating our board of directors must specify the number of shares which may be issued and, ifapplicable, any conditions to the issuance.

If the power to resolve to issue shares has not been designated to our board of directors, our Articles providethat we may issue ordinary shares, or grant rights to subscribe for ordinary shares, pursuant to a resolution of ourgeneral meeting of shareholders upon a proposal of our board of directors.

Ordinary shares may not be issued at less than their nominal value and must be fully paid up upon issue.

No resolution of our general meeting of shareholders or our board of directors is required for an issue ofordinary shares pursuant to the exercise of a previously granted right to subscribe for ordinary shares.

Pre-emptive Rights

Pursuant to our Articles, existing holders of our ordinary shares will have pre-emptive rights in respect offuture issuances of our ordinary shares in proportion to the number of ordinary shares held by them, unlesslimited or excluded as described below. Pre-emptive rights do not apply with respect to shares issued againstcontributions other than in cash or shares issued to our employees or to employees of one of our subsidiaries.

Pursuant to our Articles, our board of directors has been empowered until July 1, 2014 to limit or excludeany pre-emptive rights to which shareholders may be entitled in connection with the issuance of shares. Theauthority of the board of directors to limit or exclude pre-emptive rights can only be exercised if at that time theauthority to issue shares is in full force and effect. The authority to limit or exclude pre-emptive rights may beextended in the same manner as the authority to issue shares. If there is no designation of the board of directors tolimit or exclude pre-emptive rights in force, the general meeting of shareholders shall have the authority to limitor exclude such pre-emptive rights.

According to Dutch law, resolutions of the general meeting of shareholders (1) to limit or excludepre-emptive rights or (2) to designate the board of directors as the corporate body that has authority to limit orexclude pre-emptive rights, require at least a two-thirds majority of the votes cast in a meeting of shareholders, ifless than 50% of the issued share capital is present or represented. For these purposes, issuances of sharesincludes the granting of rights to subscribe for shares, such as options and warrants, but not the issue of sharesupon exercise of such rights.

Form, Transfer and Pledges

Our ordinary shares will be issued in registered form only. These ordinary shares must be fully paid uponissue and shall only be available without issue of a share certificate in the form of an entry in the share register.

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The register of shareholders will be maintained by us at our corporate headquarters in Amsterdam, theNetherlands. ABN AMRO and the exchange agent will provide certain record keeping and administrativeservices to us for our shareholder register. If an investor holds our ordinary shares in a securities account throughEuroclear Nederland, transfers and pledges can be made through Euroclear Nederland via a book-entry transferor pledge. If an investor does not hold our ordinary shares through a Euroclear Nederland-eligible securitiesaccount, then the transfer of our ordinary shares and the creation of restricted rights related thereto, such as aright of pledge, require a written instrument acknowledged by the Company. Acknowledgment by the Companyis not required in the event that we are a party to the written instrument.

Reduction of Share Capital

Subject to Dutch law and our Articles, the general meeting of shareholders may resolve to reduce theoutstanding share capital by canceling shares or by reducing the nominal value of shares. This will requireamendment to our Articles upon proposal of our board of directors.

A resolution of our general meeting of shareholders to reduce the issued share capital must designate theordinary shares to which the resolution applies and must make provisions for the implementation of suchresolution. A resolution to cancel shares may only be adopted in relation to shares or depositary receipts for suchshares we hold ourselves. A partial repayment or exemption from the obligation to pay up shares must be madepro rata, unless all of our shareholders agree otherwise. A resolution at our general meeting of shareholders toreduce our issued share capital requires a majority of at least two-third of the votes validly cast at a meeting atwhich less than half of our issued and outstanding share capital is present or represented. A simple majority issufficient if more than half of our issued and outstanding share capital is present or represented.

Acquisition of Ordinary Shares

Under Dutch law, a public company with limited liability may acquire its own ordinary shares, subject tocertain provisions of Dutch law (including market abuse rules) and our Articles, if (1) the Company’sshareholders’ equity less the payment required to make the acquisition does not fall below the sum of paid-upand called-up capital and any reserves required by Dutch law or our Articles and (2) the Company and itssubsidiaries would not thereafter hold shares or hold a pledge over shares with an aggregate par value exceeding50% of its current issued share capital. Such company may only acquire its own shares if its general meeting ofshareholders has granted the board of directors the authority to effect such acquisitions. Our shareholder hasauthorized our board of directors to acquire our own shares up to the maximum number allowed under Dutchlaw. These shares may be used to deliver shares under our equity-based compensation plans.

An acquisition of ordinary shares for a consideration must be authorized by our general meeting ofshareholders. Such authorization may be granted for a maximum period of 18 months and must specify thenumber of ordinary shares that may be acquired, the manner in which ordinary shares may be acquired and theprice limits within which ordinary shares may be acquired. Authorization is not required for the acquisition ofordinary shares in order to transfer them to our employees. The actual acquisition may only be effected by aresolution of our board of directors.

If we would decide to repurchase any of our shares, no votes could be cast at a general meeting ofshareholders on the shares held by us or our subsidiaries or on shares for which we or our subsidiaries holddepositary receipts. Nonetheless, the holders of a right of usufruct and the holders of a right of pledge in respectof shares held by us or our subsidiaries in our share capital are not excluded from the right to vote on such shares,if the right of usufruct or the right of pledge was granted prior to the time such shares were acquired by us or anyof our subsidiaries. Neither we nor any of our subsidiaries may cast votes in respect of a share on which we orsuch subsidiary holds a right of usufruct or a right of pledge.

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Exchange Controls and Other Provisions Relating to Non-Dutch Shareholders

Under Dutch law, there are no exchange control restrictions on investments in, or payments on, the ordinaryshares. There are no special restrictions in our Articles or Dutch law that limit the right of shareholders who arenot citizens or residents of the Netherlands to hold or vote the ordinary shares.

Dividends and Distributions

We may only make distributions to our shareholders in so far as our equity exceeds the sum of our paid-inand called-up share capital plus the reserves we are required to maintain by Dutch law or our Articles. Under ourArticles, our board of directors may determine that a portion of the profits of the current financial year shall beadded to our reserves. The remaining profits are at the disposal of our general meeting of shareholders.

We may only make distributions of dividends to our shareholders after the adoption of our statutory annualaccounts from which it appears that such distributions are legally permitted. Our Articles allow our board ofdirectors to resolve to pay interim dividends on account of the profits of the current financial year if the equityrequirement set out above is met, as evidenced by an interim statement of assets and liabilities relating to thecondition of such assets and liabilities on a date no earlier than the first day of the third month preceding themonth in which the resolution to distribute interim dividends is made public. Our shareholders do not havecumulative dividend rights. If our shareholders are not paid a distribution in or related to a particular financialyear, they are not entitled to be made whole for missed dividends at the next payment period.

Insofar as the profits have not been distributed or allocated to the reserves, they are at the free disposal ofthe general meeting of shareholders. The general meeting of shareholders may resolve, on the proposal of ourboard of directors, to distribute dividends or reserves, wholly or partially, in the form of ordinary shares.

Distributions in cash that have not been collected within five years and one day after they have become dueand payable will revert to us.

Dutch law, by providing that the declaration of dividends out of freely disposable profits is the right of thegeneral meeting of shareholders, is different from the corporate law of most jurisdictions in the United States,which permit a corporation’s board of directors to declare dividends.

General Meetings of Shareholders and Voting Rights

General meetings of shareholders will be held in Amsterdam, the Netherlands, in the municipality in whichthe Company has its statutory seat or in Amsterdam, Haarlemmermeer (Schiphol), Rotterdam or The Hague. Ageneral meeting of shareholders shall be held at least once a year within the period required by Dutch law, whichis currently no later than six months after the end of our financial year, unless our Articles provide for a shorterperiod.

Extraordinary general meetings of shareholders shall be held as frequently as deemed necessary by theboard of directors. Shareholders representing at least the percentage of the issued and outstanding share capitalrequired by law, which is currently 10%, may request that a general meeting of shareholders be convened,specifying the items for discussion.

Our board of directors must give public notice of a general meeting of shareholders or an extraordinarygeneral meeting of shareholders, by at least such number of days prior to the day of the meeting as required byDutch law, which is currently forty-two days.

The agenda for a meeting of shareholders must contain such items as the board of directors or the person orpersons convening the meeting determine. The agenda shall also include any matter, the consideration of whichhas been requested by one or more shareholders, representing alone or jointly with others at least such percentage

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of the issued capital stock as determined by Dutch law, which is currently set at one percent for listed companiesshares representing a value of €50 million. The request to consider such matter should have been received by usno later than on the 60th day prior to the day of the meeting accompanied by a statement containing the reasonsfor the request.

The agenda for the general meeting of shareholders is required to contain, among other items, items placedon the agenda in accordance with Dutch law and our Articles, the consideration of the annual report, thediscussion and adoption of our annual accounts, our policy regarding dividends and reserves and the proposal topay a dividend (if applicable), proposals relating to the composition of the board of directors, including the fillingof any vacancies on the board of directors, the proposals placed on the agenda by the board of directors,including but not limited to a proposal to grant discharge to the members of the board of directors for theirmanagement during the financial year, together with the items proposed by shareholders in accordance withprovisions of Dutch law and our Articles.

All shareholders will be entitled to attend our general meeting of shareholders, to address the generalmeeting of shareholders and to vote, either in person or represented by a person holding a written proxy. Therequirement that a proxy must be in written form is also fulfilled when it is recorded electronically.

The holder of a right of usufruct or a pledgee with voting rights is entitled to request an item to be placed onthe agenda of the general meeting of shareholders, to attend the general meeting of shareholders, to address thegeneral meeting of shareholders and to vote.

Under Dutch law, shareholders’ resolutions may be adopted in writing without holding a meeting ofshareholders, provided that (1) all shareholders agree on this practice for decision making and (2) allshareholders are in favor of the resolution to be adopted. Our Articles, however, do not provide for shareholderaction by written consent as it is not practicable for a listed company.

Members of the board of directors are authorized to attend general meetings of shareholders. They have anadvisory vote. The general meeting of shareholders is presided over by the chairman. In the absence of thechairman, one of the other non-executive directors presides over the meeting.

Under Dutch law, each ordinary share confers the right to cast one vote at the general meeting ofshareholders. Each shareholder may cast as many votes as it holds shares. Each ordinary share will confer theright to cast at least one vote. Resolutions proposed to the general meeting of shareholders by the board ofdirectors must be adopted by a simple majority of votes cast, unless another majority of votes and/or a quorum isrequired by virtue of Dutch law or our Articles. Other resolutions may be adopted by a simple majority of votescast representing at least one-third of the issued and outstanding capital, unless another majority of votes and/or aquorum is required by virtue of Dutch law or our Articles.

The only persons entitled to attend and to vote at the general meeting are persons who at the record date,which is the 28th day prior to the day of the general meeting, have such rights and are recorded in a register soappointed by the board of directors. There is no specific provision in Dutch law relating to adjournment of thegeneral meeting of shareholders.

Under Dutch law, the approval of our general meeting of shareholders is required for any significant changein our identity or our business.

Amendment of our Articles of Association

Our general meeting of shareholders may only resolve to amend our Articles upon a proposal made by ourboard of directors. A proposal to amend the Articles must be included in the agenda for the relevant generalmeeting of shareholders. A copy of the proposal containing the proposed amendment must be lodged with theCompany and must be available for inspection by every shareholder until the end of the general meeting ofshareholders. Each material amendment will be put to a vote of the shareholders separately.

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Dissolution and Liquidation

Under our Articles, we may be dissolved by a resolution of our general meeting of shareholders upon aproposal of our board of directors.

In the event of dissolution, our business will be liquidated in accordance with Dutch law and our Articlesand the liquidation shall be effected by our board of directors. During liquidation, the provisions of our Articleswill remain in force to the extent possible. Any assets remaining upon completion of the dissolution will bedistributed to the holders of ordinary shares in proportion to the aggregate nominal amount of their ordinaryshares.

Financial Reports and Rules on Ongoing Disclosure and Filing Requirements

Our first financial year lapsed on June 30, 2012. As from July 1, 2012 our financial year will coincide withthe calendar year through a change of the fiscal year end to December 31, with the first such fiscal year endingon December 31, 2013. Each year, within four months after the end of the financial year, our board of directorsmust authorize financial statements which it must make available for inspection by our shareholders at ourexecutive offices. The annual accounts must be accompanied by an auditor’s statement, an annual report andother documentation required by Dutch law. The financial statements must be adopted by our general meeting ofshareholders.

We are required to prepare consolidated financial statements and consolidated interim semi-annual financialstatements in conformity with IFRS as issued by the International Accounting Standards Board and in conformitywith IFRS as adopted by the European Union. The consolidated financial statements will be authorized by ourboard of directors and are audited by an independent accounting firm.

Pursuant to the Financial Markets Supervision Act (Wet op het financieel toezicht), as amended, which werefer to as FMSA, we are required to make the following periodic financial information generally available:

• our financial statements, within four months after the end of each financial year;

• our interim semi-annual financial statements, within two months after the end of the first six months ofeach financial year; and

• interim management reports during the first and the second half of each financial year between tenweeks after the beginning and six weeks before the end of the relevant six-month period.

We may publish this periodic financial information by means of a press release that refers to our websitewhere the information is available in full.

We intend to provide, as long as we are required to do so, our shareholders with annual reports on Form20-F containing financial statements audited by our independent auditors. We are required to file periodic reportsand other information with the SEC pursuant to the Exchange Act.

Rules Governing Obligations of Shareholders to Make a Public Offer

European Directive 2004/25/EC of April 21, 2004, relating to public takeover bids, which we refer to as theTakeover Directive, has been implemented in the FMSA.

A shareholder who (individually or acting in concert with others) directly or indirectly obtains control of aDutch listed company such as ours, is required to make a public offer for all shares. Such control is deemedpresent if a (legal) person is able to exercise, alone or acting in concert, at least 30% of the voting rights in thegeneral meeting of shareholders of a listed company.

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Furthermore, in general, it is prohibited to launch a public offer for shares of a listed company unless anoffer memorandum has been approved by, in our case, the AFM. A public offer is launched by way ofpublication of the approved offer memorandum. The public offer rules are intended to ensure that in the event ofa public offer, among other things, sufficient information will be made available to the holders of the shares, thatthe holders of the shares will be treated equally, that there will be no abuse of inside information and that therewill be a proper and timely offer period.

Squeeze Out Procedures

Pursuant to article 2:92a of the Dutch Civil Code, a shareholder who for his own account contributes at least95% of our issued share capital may initiate proceedings against our minority shareholders jointly for the transferof their shares to the claimant. The proceedings are held before the Enterprise Chamber and can be instituted bymeans of a writ of summons served upon each of the minority shareholders in accordance with the provisions ofthe Dutch Code of Civil Procedure (Wetboek van Burgerlijke Rechtsvordering). The Enterprise Chamber maygrant the claim for squeeze out in relation to all minority shareholders and will determine the price to be paid forthe shares, if necessary after appointment of one or three experts who will offer an opinion to the EnterpriseChamber on the value to be paid for the shares of the minority shareholders. Once the order to transfer becomesfinal before the Enterprise Chamber, the person acquiring the shares shall give written notice of the date andplace of payment and the price to the holders of the shares to be acquired whose addresses are known to him.Unless the addresses of all of them are known to the acquiring person, such person is required to publish thesame in a daily newspaper with a national circulation.

The offeror under a public offer is also entitled to start a squeeze out procedure if, following the publicoffer, the offeror holds at least 95% of the share capital and represents at least 95% of the total voting rights. Theclaim of a takeover squeeze out must be filed with the Enterprise Chamber within three months following theexpiry of the acceptance period of the offer. The Enterprise Chamber may grant the claim for a takeover squeezeout in relation to all minority shareholders and will determine the price to be paid for the shares, if necessaryafter appointment of one or three experts who will offer an opinion to the Enterprise Chamber on the value to bepaid for the shares of the minority shareholders. In principle, the offer price is considered reasonable as long as90% or more of the shares have been acquired.

The Dutch Civil Code also entitles those minority shareholders that have not previously tendered theirshares under an offer to transfer their shares to the offeror, provided that the offeror has acquired at least 95% ofthe share capital and represents at least 95% of the total voting rights. In regard to price, the same procedure asfor takeover squeeze out proceedings initiated by an offeror applies. This claim must also be filed with theEnterprise Chamber within three months following the expiry of the acceptance period of the offer.

Obligation to Disclose Holdings and Transactions

Shareholders may be subject to notification obligations under the FMSA. Shareholders are advised to seekprofessional advice on these obligations.

Shareholders

Pursuant to the FMSA, any person who, directly or indirectly, acquires or disposes of an interest in our sharecapital or voting rights must immediately notify the AFM by means of a standard form, if, as a result of suchacquisition or disposal, the percentage of capital interest or voting rights held by such person in us reaches,exceeds or falls below any of the following thresholds: 5% (a legislative proposal is expected to be adopted,which would introduce an initial threshold of 3%), 10%, 15%, 20%, 25%, 30%, 40%, 50%, 60%, 75% and 95%of the voting rights or capital interests in our issued share capital.

A notification requirement also applies if a person’s capital interest or voting rights reaches, exceeds or fallsbelow the abovementioned thresholds as a result of a change in our total share capital or voting rights. This

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notification has to be made no later than the fourth trading day after the AFM has published our notification asdescribed below. We will be required to notify the AFM immediately of the changes to our total share capital orvoting rights if our share capital or voting rights changes by 1% or more since our previous notification. We willin addition be required every quarter to notify the AFM within eight days after the relevant quarter, in the eventour share capital or voting rights changed by less than 1% in that relevant quarter since our previous notification.

Furthermore, every holder of 5% or more of our share capital or voting rights whose interest at midnightCentral European Time on each December 31 differs from a previous notification to the AFM, as a result ofcertain acts (including but not limited to the exchange of shares for depository receipts and the exercise of a rightto acquire shares) must notify the AFM within four weeks after such December 31.

For the purpose of calculating the percentage of capital interest or voting rights, among other metrics, thefollowing interests must be taken into account: (1) shares or voting rights directly held (or acquired or disposedof) by a person, (2) shares or voting rights held (or acquired or disposed of) by such person’s subsidiaries or by athird party for such person’s account or by a third party with whom such person has concluded an oral or writtenvoting agreement (including a discretionary power of attorney), and (3) shares which such person, or anysubsidiary or third party referred to above, may acquire pursuant to any option or other right held by such person(or acquired or disposed of, including, but not limited to, on the basis of convertible bonds).

As of January 1, 2012, certain cash settled derivatives are also taken into account when calculating thecapital interest. Disclosure of cash settled derivatives may be required under the rules if the instrument held fallswithin any of the following three categories: (a) financial instruments of which the price increase is at leastpartially dependent on a price increase of shares or distributions, and which do not entitle the holder to physicalsettlement, (b) short positions in put options and (c) other contracts of similar economic effect to holding shares.

Subsidiaries, within the meaning of the relevant regulation under the FMSA, do not have notificationobligations under the FMSA, as their direct and indirect interests are attributed to their (ultimate) parent. Anyperson may qualify as a parent for purposes of the FMSA, including an individual. A person who holds 5% ormore of our share capital or voting rights and who ceases to be a subsidiary for these purposes must immediatelynotify the AFM. As of that moment, all notification obligations under the FMSA will become applicable to theformer subsidiary.

Special rules apply with respect to the attribution of shares or voting rights which are part of the property ofa partnership or other community of property. A holder of a pledge or right of usufruct (vruchtgebruik) in respectof shares can also be subject to the notification obligations of the FMSA, if such person has, or can acquire, theright to vote on the shares or, in the case of depository receipts, the underlying shares. The acquisition ofconditional voting rights by a pledgee or usufructuary may also trigger the notification obligations as if thepledgee or usufructuary were the legal holder of such shares or voting rights.

The FMSA and the rules promulgated pursuant thereto contain detailed rules that set out how itsrequirements apply to certain categories of holders, including but not limited to investment funds, investmentmanagers, custodians, market makers, clearing and settlement institutions, brokers and credit institutions.

Management

Pursuant to the FMSA, any member of our board of directors and any other person who has managerial orco-managerial responsibilities in respect of us or who has the authority to make decisions affecting our futuredevelopments and business prospects and who may have regularly access to inside information relating, directlyor indirectly, to us, must give written notice to the AFM by means of a standard form of any transactionsconducted for his own account relating to our shares or in financial instruments the value of which is also basedon the value of our shares.

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Furthermore, in accordance with the FMSA and the regulations promulgated thereunder, certain personswho are closely associated with members of our board of directors or any of the other persons as describedabove, are required to notify the AFM of any transactions conducted for their own account relating to our sharesor in financial instruments the value of which is also based on the value of our shares. The FMSA and theregulations promulgated thereunder cover the following categories of persons: (1) the spouse or any partnerconsidered by national law as equivalent to the spouse, (2) dependent children, (3) other relatives who haveshared the same household for at least one year at the relevant transaction date, and (4) any legal person, trust orpartnership whose, among other things, managerial responsibilities are discharged by a person referred to under(1), (2) or (3) above or by the relevant member of our board of directors or other person with any authority inrespect of us as described above.

The AFM must be notified no later than the fifth business day following the relevant transaction date.Under certain circumstances, notification may be postponed until the date the value of the transactions performedfor that person’s own account, together with transactions carried out by the persons closely associated with thatperson, amounts to €5,000 or more in the calendar year in question.

Non-Compliance

Non-compliance with the notification obligations under the FMSA could lead to criminal fines,administrative fines, imprisonment or other sanctions. In addition, non-compliance with some of the notificationobligations under the FMSA may lead to civil sanctions, including suspension of the voting rights relating to ourshares held by the offender for a period of not more than three years and a prohibition to own shares or votingrights on our shares for a period of not more than five years.

Public Registry

The AFM does not issue separate public announcements of notifications received by it. It does, however,keep a public register of all notifications under the FMSA on its website, http://www.afm.nl. Third parties canrequest to be notified automatically by e-mail of changes to the public register in relation to a particularcompany’s shares or a particular notifying party.

Market Abuse Regime

The FMSA contains rules intended to prevent market abuse, such as insider trading, tipping and marketmanipulation.

Pursuant to the rules intended to prevent market abuse, we have adopted an internal code on insideinformation in respect of the holding of and carrying out of transactions in our shares or in financial instrumentsthe value of which is determined by the value of our shares by members of our board of directors and employees.Furthermore, we have drawn up a list of those persons working for us who could have access to insideinformation on a regular or incidental basis and have informed the persons concerned of the rules on insidertrading and market manipulation, including the sanctions which can be imposed in the event of a violation ofthose rules.

DESCRIPTION OF CERTAIN INDEBTEDNESS

Revolving Credit Facility Agreement

In connection with the separation, D.E MASTER BLENDERS and DE US, Inc. entered into a seniorunsecured five-year revolving credit facility agreement on May 22, 2012, which we refer to as the FacilityAgreement. The Facility Agreement provides for a single facility with a borrowing capacity of €750 million,which we refer to as the Facility. The Facility Agreement is governed by English law. This summary does notpurport to be complete and is qualified in its entirety by the provisions of the Facility Agreement, a copy ofwhich is filed as an exhibit to this Annual Report.

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The proceeds from the Facility are being used for general corporate purposes, but may not be used forbackstopping any financial markets issuing program. Loans may be drawn between the date of the FacilityAgreement and three months prior to the fifth anniversary of the Facility Agreement, provided certain conditionsprecedent are met. The term for each loan is three or six months or any other period agreed by the Company andall the lenders party to the Facility Agreement.

Interest on each loan under the Facility is equal to the sum of (1) a margin ranging from 0.60 percent perannum to 1.05 percent per annum depending first on whether the Company has a credit rating and, upon theCompany receiving a credit rating, the level of the Company’s credit rating, which we refer to as the Margin,(2) EURIBOR, and (3) certain mandatory costs calculated in accordance with the terms of the FacilityAgreement. The Facility is subject to a commitment fee equal to 35 percent of the Margin on undrawncommitments, and to a utilization fee on outstanding loans, ranging from 0.125 percent per annum to0.50 percent per annum depending on the amount of the Facility outstanding on each day. Interest must be paid atthe end of the term of each loan, unless the loan is for more than six months, in which case interest must be paidat six month intervals after the first day of that term.

The Facility Agreement is unsecured and ranks, and will continue to rank, equally with any of our othersenior unsecured indebtedness. DE US, Inc. is currently the only guarantor under the Facility Agreement. Subjectto certain conditions, other wholly owned subsidiaries of the Company can become guarantors either at therequest of the Company, or as required to maintain the ranking of the debt under the Facility. Each guarantorguarantees the punctual performance of all of the Company obligations under the Facility Agreement and otherfinance documents.

Voluntary prepayments of loans and voluntary cancellation of undrawn commitments are permitted in wholeor in part, at any time and without penalty, subject to certain conditions. Prepayment and cancellation aremandatory if it becomes unlawful for a lender to perform its obligations under the Facility Agreement or anyother finance document and that lender so requests, or if there is a change of control of the Company and a lenderso requests.

The Facility Agreement contains affirmative and negative covenants in relation to the following: financialreporting; informational reporting; maintenance of authorizations; compliance with laws and regulations;maintenance of pari passu ranking; insurance; maintaining a maximum debt to adjusted EBITDA ratio;limitations on liens; limitations on subsidiary indebtedness; limitations on disposals of assets; limitations onchanging of business lines; and limitations on corporate changes.

The Facility Agreement contains representations and warranties on the following matters: status; power andauthority; validity of finance documents; no conflict; no default; authorizations; accuracy of financial statements;no material adverse change; no litigation; accuracy of information package; taxes; stamp duty; immunity; centerof main interests; pari passu ranking; submission to jurisdiction; ERISA; and certain U.S. investment legislation.

The Facility Agreement contains the following events of default: non-payment; breach of financialcovenant; breach of other obligations; misrepresentation; cross-default; insolvency (proceedings); creditors’process; unlawfulness; repudiation of finance document; ceasing to carry on business; invalidity of financedocument; a guarantor ceasing to be a subsidiary of the Company; and material adverse change.

Bridge Financing

In connection with the separation, on May 29, 2012, two of our subsidiaries entered into two seniorunsecured interim loan agreements with substantially identical terms. Specifically, DE US, Inc. entered into a$1.8 billion interim loan agreement with Bank of America, N.A., Goldman Sachs Lending Partners LLC, andJPMorgan Chase Bank, N.A., as lenders, among others, which we refer to as Bridge Loan 1, and DEMBInternational B.V. entered into a $1.8 billion interim loan agreement with the same lenders and other parties,

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which we refer to as Bridge Loan 2. Together we refer to Bridge Loan 1 and Bridge Loan 2 as the Bridge Loans.Bridge Loan 1 was funded on June 28, 2012 and repaid on June 29, 2012 with the proceeds of Bridge Loan 2.Bridge Loan 2 was funded and subsequently repaid with cash on hand on June 29, 2012. No further amounts canbe drawn under these loan agreements.

Note Purchase and Guarantee Deed

DE US, Inc. issued $650 million aggregate principal amount of DE US, Inc. debt securities to Sara Leepursuant to a note purchase and guarantee deed executed on May 15, 2012 by and among us, DE US, Inc. andSara Lee. The indebtedness is comprised of $232 million of 3.60% Series A Senior Notes due May 15, 2019,$120 million of 3.81% Series B Senior Notes due May 15, 2020, $124 million of 4.03% Series C Senior Notesdue May 15, 2021 and $174 million of 4.20% Series D Senior Notes due May 15, 2022, which we refer tocollectively as the DE US, Inc. debt securities. At the time of the separation, Sara Lee mandatorily exchangedthese DE US, Inc. debt securities for debt securities that were issued by Sara Lee to institutional investors andwhich had substantially the same terms. Consequently, these DE US, Inc. debt securities currently are held bythose institutional investors. The corresponding Sara Lee debt securities have subsequently been cancelled.

Pursuant to the note purchase and guarantee deed, D.E MASTER BLENDERS unconditionally guaranteesthe payment of all principal and interest, plus a make-whole amount equal to the excess of the discounted valueof the remaining scheduled payments of the principal to be prepaid, and other additional payments to the holdersof the DE US, Inc. debt securities.

The DE US, Inc. debt securities are payable semi-annually with interest (computed on the basis of a 360-dayyear of twelve 30-day months). DE US, Inc. may prepay the debt securities at any time on or after May 15, 2017,in an amount not less than $1,000,000, at a price equal to 100% of the principal amount being prepaid, plus amake-whole amount equal to the excess of the discounted value of the remaining scheduled payments of theprincipal to be prepaid. Additionally, DE US, Inc. must offer to prepay all the debt securities upon the occurrenceof a change of control at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interestto the date of prepayment. The debt securities are unsecured senior obligations of D.E MASTER BLENDERSand DE US, Inc., ranking equal in right of payment with all other senior unsecured indebtedness of D.EMASTER BLENDERS and DE US, Inc.

The note purchase and guarantee deed contains covenants that limit the ability of us and certain of oursubsidiaries to, among other things: enter into transactions with affiliates, incur or create liens, sell assets, issuepriority indebtedness and change lines of business. In addition, the note purchase and guarantee deed contains acovenant that limits the ability of D.E MASTER BLENDERS and DE US, Inc. to consolidate with or merge withany other entity or convey, transfer or lease substantially all of its assets. D.E MASTER BLENDERS and DEUS, Inc. must also maintain a maximum debt to adjusted EBITDA ratio. The note purchase and guarantee deedcontains customary default provisions, including cross-default provisions. Upon default, the DE US, Inc. debtsecurities either become automatically due and payable or may be declared by the holders of the securities to beimmediately due and payable at a price equal to 100% of the outstanding principal amount thereof, plus accruedand unpaid interest to the date of prepayment and the make-whole amount.

10C Material contracts

We use various types of agreements in the course of our business. Some of these agreements are based onmodel agreements which we use for certain sales to customers. Other agreements are negotiated individually andhave terms specific to the particular transaction and the wishes of our counterparty and ourselves. Occasionally,transactions are based solely on general terms and conditions. The following is a list of the material contracts wehave entered into over the past two years:

• Our contract with Philips, described above under “Item 4B-Business Overview—Intellectual Property.”

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• Our management services agreement with our Chief Executive Officer, described above in“Item 6–Directors, Senior Management And Employees—Management Services Agreement withMichiel Herkemij.”

• Our separation agreements with Sara Lee, described below under “Item 7B Related PartyTransactions—Agreements with Sara Lee Corporation.”

• Our lease for our manufacturing facility in Mollet, Spain.

• Our note purchase deed and guarantee with Sara Lee and DE US, Inc., described above in“Item 10B—Description of Certain Indebtedness.”

• Our revolving credit facility agreement, described above in “Item 10B—Description of CertainIndebtedness.”

• Our bridge loan agreements, described above in “Item 10B—Description of Certain Indebtedness.”

• Agreement for services entered into with Mr. Illy on June 28, 2012.

• License and services agreement with JMS Foodservice, LLC dated January 3, 2012.

10D Exchange controls

Under Dutch law, there are no exchange control restrictions on investments in, or payments on, the ordinaryshares. There are no special restrictions in our Articles or Dutch law that limit the right of shareholders who arenot citizens or residents of the Netherlands to hold or vote the ordinary shares.

10E Taxation

Taxation in the Netherlands

The following is intended as general information only and it does not seek to present any comprehensive orcomplete description of all aspects of Dutch tax law which could be of relevance to a current or prospectiveholder of D.E MASTER BLENDERS ordinary shares, which, for purposes of this discussion we refer to as ashareholder. For Dutch tax purposes, a shareholder may include an individual or entity who does not have thelegal title of D.E MASTER BLENDERS ordinary shares but to whom nevertheless D.E MASTER BLENDERSordinary shares are attributed based either on such individual or entity holding a beneficial interest in D.EMASTER BLENDERS ordinary shares or based on specific statutory provisions, including statutory provisionspursuant to which D.E MASTER BLENDERS ordinary shares are attributed to an individual who is, or who hasdirectly or indirectly inherited from a person who was, the settlor, grantor or similar originator of a trust,foundation or similar entity that holds D.E MASTER BLENDERS ordinary shares.

Shareholders and prospective shareholders should therefore consult their tax adviser regarding the taxconsequences of any purchase, ownership or disposal of D.E MASTER BLENDERS ordinary shares.

The following summary is based on the Dutch tax law as applied and interpreted by Dutch tax courts and aspublished and in effect on the date hereof, without prejudice to any amendments introduced at a later date andimplemented with or without retroactive effect.

For the purpose of this discussion, Dutch Taxes shall mean taxes of whatever nature levied by or on behalfof the Netherlands or any of its subdivisions or taxing authorities. The Netherlands means the part of theKingdom of the Netherlands located in Europe.

Any reference hereafter made to a treaty for the avoidance of double taxation concluded by the Netherlands,includes the Tax Regulation for the Kingdom of the Netherlands (Belastingregeling voor het Koninkrijk) and theTax Regulation for the country of the Netherlands (Belastingregeling voor het land Nederland).

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Withholding tax

A shareholder is generally subject to Dutch dividend withholding tax at a rate of 15% on dividendsdistributed by the Company. Generally, the Company is responsible for the withholding of such dividendwithholding tax at source; the dividend withholding tax is for the account of the shareholder. Dividendsdistributed by the Company include, but are not limited to:

(1) distributions of profits in cash or in kind, whatever they be named or in whatever form;

(2) proceeds from the liquidation of the Company, or proceeds from the repurchase of D.E MASTERBLENDERS ordinary shares by the Company, in excess of the average paid-in capital recognized forDutch dividend withholding tax purposes;

(3) the nominal value of D.E MASTER BLENDERS ordinary shares issued to a shareholder or an increasein the nominal value of D.E MASTER BLENDERS ordinary shares, to the extent that no relatedcontribution, recognized for Dutch dividend withholding tax purposes, has been made or will be made;and

(4) partial repayment of paid-in capital, that is:

a. not recognized for Dutch dividend withholding tax purposes, or

b. recognized for Dutch dividend withholding tax purposes, to the extent that the Company has netprofits (zuivere winst), unless:

• the general meeting has resolved in advance to make such repayment, and

• the nominal value of D.E MASTER BLENDERS ordinary shares concerned has beenreduced with an equal amount by way of an amendment to the Articles.

With regard to (2) above, the Company’s average paid-in capital recognized for Dutch dividend withholdingtax purposes is the fair market value of the DE US, Inc. shares. Furthermore, no withholding is required in theevent of a repurchase of D.E MASTER BLENDERS ordinary shares, if certain conditions are fulfilled.

Subject to certain exceptions under Dutch domestic law, D.E MASTER BLENDERS may not be required totransfer to the Dutch tax authorities the full amount of Dutch dividend withholding tax withheld in respect ofdividends distributed by D.E MASTER BLENDERS, if the Company has received a profit distribution from aqualifying foreign subsidiary, which distribution is exempt from Dutch corporate income tax and has beensubject to a foreign withholding tax at a rate of at least 5%. The amount that does not have to be transferred to theDutch tax authorities can generally not exceed the lesser of (1) 3% of the dividends distributed by the Companyand (2) 3% of the profit distributions the Company received from qualifying foreign subsidiaries in the calendaryear in which the Company distributes the dividends (up to the moment of such dividend distribution) and thetwo previous calendar years; further limitations and conditions apply.

If a shareholder is resident or deemed to be resident in the Netherlands or, in case of an individual, has optedto be treated as if resident in the Netherlands, such shareholder may be entitled to an exemption or a full creditfor any Dutch dividend withholding tax against his Dutch (corporate) income tax liability and to a refund of anyresidual Dutch dividend withholding tax.

If a shareholder is resident in a country other than the Netherlands, under the provisions of a treaty for theavoidance of double taxation between the Netherlands and such country such shareholder may, depending on theterms of such treaty, be entitled to an exemption from, reduction in or refund of, Dutch dividend withholding taxon dividends distributed by the Company.

If a shareholder:

• is an entity which is resident for Dutch tax purposes in a member state of the European Union or inIceland, Liechtenstein or Norway or a qualifying shareholder resident elsewhere (see below);

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• is not subject to a profit tax levied by that state; and, in case the shareholder is not resident in theNetherlands,

• would not have been subject to Dutch corporate income tax had the shareholder been resident in theNetherlands for Dutch tax purposes;

generally, such shareholder will be eligible for a full refund of Dutch dividend withholding tax on dividendsdistributed by the Company, unless such shareholder carries out duties or activities comparable to an investmentinstitution (beleggingsinstelling) as defined in articles 6a and 28 of the Dutch Corporate Income Tax Act 1969,which we refer to as the CITA, respectively.

For purposes of the above, a qualifying shareholder is an entity that (1) is resident for Dutch tax purposes ina jurisdiction which has an arrangement for the exchange of tax information with the Netherlands and (2) holdsits D.E MASTER BLENDERS ordinary shares as portfolio investment, i.e. such shares are not held with a viewto establishment or maintenance of lasting and direct economic links between the shareholder and D.E MASTERBLENDERS and the shares do not allow the shareholder to participate effectively in the management or controlof D.E MASTER BLENDERS.

A shareholder who satisfies the conditions of the 1992 Double Taxation Treaty between the U.S. and theNetherlands for the avoidance of double taxation, as amended most recently by the Protocol signed March 8,2004, which we refer to as the Treaty, may be entitled to a reduction in the Dutch withholding tax by way of anexemption, reduction or refund. The main conditions are: being a resident of the United States for the purposes ofthe Treaty, being the beneficial owner of the distributed dividend and being qualified under article 26 of theTreaty (the limitation on benefits article). Such shareholder will effectively be subject to Dutch dividendwithholding tax as follows:

• if the U.S. shareholder is an exempt pension trust as described in article 35 of the Treaty, or an exemptorganization as described in article 36 of the Treaty, the U.S. shareholder will be exempt from Dutchdividend withholding tax;

• if the U.S. shareholder is a company which holds directly at least 10% but less than 80% of the votingpower in D.E MASTER BLENDERS, the U.S. shareholder will be subject to Dutch withholding tax ata rate not exceeding 5%;

• if the U.S. shareholder is a company which holds directly at least 80% of the voting power in D.EMASTER BLENDERS and certain other conditions are met, the U.S. shareholder will be exempt fromDutch dividend withholding tax; and

• in all other cases, the U.S. shareholder will be subject to Dutch dividend withholding tax at a rate notexceeding 15%.

U.S. shareholders qualifying for a reduction in the Dutch withholding tax may generally claim (1) anexemption or reduction at source, or (2) a refund, by filing, through the withholding agent as mentioned in article9 of the Dutch Dividend Withholding Tax Act 1965, a completed and signed copy of one of the following formswithin three years after the end of the calendar year in which the withholding tax was levied:

• if the U.S. shareholder is an exempt pension trust as described in article 35 of the Treaty: Form IB 96USA; or

• if the U.S. shareholder is an exempt organization as described in article 36 of the Treaty: Form IB 95USA.

According to Dutch domestic anti-dividend stripping rules, no credit against Dutch (corporate) income tax,exemption from, reduction in or refund of, Dutch dividend withholding tax will be granted if the recipient of thedividend paid by D.E MASTER BLENDERS is not considered to be the beneficial owner (uiteindelijkgerechtigde) of such dividends as meant in these rules.

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Taxes on income and capital gains

This section does not purport to describe the possible Dutch tax considerations or consequences that may berelevant to a shareholder:

(1) who receives, or has received, D.E MASTER BLENDERS ordinary shares or benefits from D.EMASTER BLENDERS ordinary shares as income from employment or deemed employment orotherwise as compensation;

(2) who has a (fictitious) substantial interest;

(3) that is an entity that is not subject to Dutch corporate income tax or is in full or in part exempt fromDutch corporate income tax (such as pension funds);

(4) that is an investment institution as defined in articles 6a and 28 CITA; or

(5) that is entitled to the participation exemption (deelnemingsvrijstelling) with respect to the D.EMASTER BLENDERS ordinary shares (as defined in article 13 CITA).

Generally, a shareholder has a substantial interest (aanmerkelijk belang) in D.E MASTER BLENDERS ifsuch shareholder, alone or together with his partner, directly or indirectly:

(1) owns, or holds certain rights on, D.E MASTER BLENDERS ordinary shares representing 5% or moreof the total issued and outstanding capital of D.E MASTER BLENDERS, or of the issued andoutstanding capital of any class of shares of D.E MASTER BLENDERS;

(2) holds rights to, directly or indirectly, acquire D.E MASTER BLENDERS ordinary shares, whether ornot already issued, representing 5% or more of the total issued and outstanding capital of the Company,or of the issued and outstanding capital of any class of shares of the Company; or

(3) owns, or holds certain rights on, profit participating certificates that relate to 5% or more of the annualprofit of the Company or to 5% or more of the liquidation proceeds of the Company.

A shareholder will also have a substantial interest if his partner or one of certain relatives of the shareholderor of his partner has a (fictitious) substantial interest.

Generally, a shareholder has a fictitious substantial interest (fictief aanmerkelijk belang) in the Company if,without having an actual substantial interest in D.E MASTER BLENDERS:

(1) D.E MASTER BLENDERS ordinary shares have been obtained under inheritance law or matrimoniallaw, on a non-recognition basis, while the disposing shareholder had a substantial interest in theCompany;

(2) D.E MASTER BLENDERS ordinary shares have been acquired pursuant to a share merger, legalmerger or legal demerger, on an elective non-recognition basis, while the shareholder prior to thistransaction had a substantial interest in an entity that was party thereto; or

(3) the D.E MASTER BLENDERS ordinary shares held by the shareholder, prior to dilution, qualified as asubstantial interest and, by election, no gain was recognized upon disqualification of these shares.

Residents in the Netherlands

The description of certain Dutch tax consequences in this paragraph is only intended for the followingshareholders:

(1) individuals who are resident or deemed to be resident in the Netherlands for purposes of Dutch incometax;

(2) individuals who opt to be treated as if resident in the Netherlands for purposes of Dutch income tax (werefer to (1) and (2) jointly as Dutch Individuals); and

(3) entities that are resident or deemed to be resident in the Netherlands for purposes of the CITA, whichwe refer to as Dutch Corporate Entities.

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Dutch Individuals engaged or deemed to be engaged in an enterprise or in miscellaneous activities

Dutch Individuals are generally subject to income tax at statutory progressive rates with a maximum of 52%with respect to any benefits derived or deemed to be derived from Dutch Enterprise Shares (as defined below),including any capital gains realized on the disposal thereof.

Dutch Enterprise Shares are D.E MASTER BLENDERS ordinary shares or any right to derive benefitstherefrom:

(1) which are attributable to an enterprise from which a Dutch Individual derives profits, whether as anentrepreneur (ondernemer) or pursuant to a co-entitlement to the net worth of such enterprise (otherthan as an entrepreneur or a shareholder); or

(2) of which the benefits are taxable in the hands of a Dutch Individual as benefits from miscellaneousactivities (resultaat uit overige werkzaamheden) including, without limitation, activities which arebeyond the scope of active portfolio investment activities.

Dutch Individuals not engaged or deemed to be engaged in an enterprise or in miscellaneous activities

Generally, a Dutch Individual who holds D.E MASTER BLENDERS ordinary shares, excluding DutchEnterprise Shares, will be subject annually to an income tax imposed on a fictitious yield on such D.E MASTERBLENDERS ordinary shares under the regime for savings and investments (inkomen uit sparen en beleggen).Irrespective of the actual income or capital gains realized, the annual taxable benefit of all the assets andliabilities of a Dutch Individual that are taxed under this regime, including the D.E MASTER BLENDERSordinary shares, is set at a fixed amount. The fixed amount equals 4% of the fair market value of the assetsreduced by the liabilities measured, in general, at the beginning of every calendar year. The tax rate under theregime for savings and investments is a flat rate of 30%.

Dutch Corporate Entities

Dutch Corporate Entities are generally subject to corporate income tax at statutory rates up to 25% withrespect to any benefits derived or deemed to be derived, including any capital gains realized on the disposal, ofD.E MASTER BLENDERS ordinary shares.

Non-residents in the Netherlands

A shareholder that is not resident or deemed to be resident in the Netherlands or, in case of an individual,has not opted to be treated as if resident in the Netherlands, will not be subject to Dutch Taxes on income orcapital gains with respect to the ownership and disposal of D.E MASTER BLENDERS ordinary shares, otherthan dividend withholding tax as described above, except if:

(1) such shareholder derives profits from an enterprise, whether as entrepreneur or pursuant to aco-entitlement to the net worth of such enterprise other than as an entrepreneur or shareholder, whichenterprise is, in whole or in part, carried on through a permanent establishment (vaste inrichting) or apermanent representative (vaste vertegenwoordiger) in the Netherlands, to which D.E MASTERBLENDERS ordinary shares are attributable;

(2) such shareholder is an individual and derives benefits from miscellaneous activities (resultaat uitoverige werkzaamheden) carried out in the Netherlands in respect of D.E MASTER BLENDERSordinary shares, including, without limitation, activities which are beyond the scope of active portfolioinvestment activities;

(3) such shareholder is not an individual and is entitled, other than by way of the holding of securities, to ashare in the profits of an enterprise or a co-entitlement to the net worth of an enterprise, that iseffectively managed in the Netherlands and to which enterprise the D.E MASTER BLENDERSordinary shares are attributable; or

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(4) such shareholder is an individual and is entitled, other than by way of the holding of securities, to ashare in the profits of an enterprise, that is effectively managed in the Netherlands and to whichenterprise the D.E MASTER BLENDERS ordinary shares are attributable.

Gift tax and inheritance tax

No Dutch gift or inheritance tax is due in respect of any gift of D.E MASTER BLENDERS ordinary sharesby, or inheritance of D.E MASTER BLENDERS ordinary shares on the death of, a shareholder except if:

(1) at the time of the gift or death of the shareholder, the shareholder is resident, or is deemed to beresident, in the Netherlands;

(2) the shareholder passes away within 180 days after the date of the gift of the D.E MASTERBLENDERS ordinary shares and is not, or not deemed to be, at the time of the gift, but is, or deemed tobe, at the time of his death, resident in the Netherlands; or

(3) the gift of D.E MASTER BLENDERS ordinary shares is made under a condition precedent and theshareholder is resident, or is deemed to be resident, in the Netherlands at the time the condition isfulfilled.

Other taxes and duties

No other Dutch Taxes, including turnover tax and taxes of a documentary nature, such as capital tax, stampor registration tax or duty, are payable by or on behalf of a shareholder by reason only of the purchase, ownershipand disposal of D.E MASTER BLENDERS ordinary shares.

Residency

Subject to the exceptions mentioned above, a shareholder will not become resident, or deemed resident, inthe Netherlands for tax purposes, or become subject to Dutch Taxes, by reason only of the Company’sperformance, or the shareholder’s acquisition (by way of issue or transfer to it), ownership or disposal of D.EMASTER BLENDERS ordinary shares.

Taxation in the United States

This summary is based upon the Code, existing and proposed Treasury regulations promulgated thereunderand current administrative rulings and court decisions, all as in effect as of the date of this Annual Report, and allof which are subject to change, possibly with retroactive effect. This discussion is limited to D.E MASTERBLENDERS shareholders that are U.S. Holders, as defined below, that hold their ordinary shares of D.EMASTER BLENDERS as a capital asset (generally, for investment purposes). Further, this discussion does notaddress all U.S. federal income tax considerations that may be relevant to particular shareholders in light of theirparticular circumstances, such as tax-exempt entities, partnerships (including entities treated as partnerships forU.S. federal income tax purposes), holders who acquired their ordinary shares of D.E MASTER BLENDERSpursuant to the exercise of employee common stock options or otherwise as compensation, holders who holddifferent blocks of D.E MASTER BLENDERS ordinary shares (generally shares of D.E MASTER BLENDERSordinary shares purchased or acquired on different dates or at different prices), financial institutions, insurancecompanies, dealers or traders in securities, persons that actually or constructively hold 10% or more of theordinary shares of D.E MASTER BLENDERS, and holders who hold their ordinary shares of D.E MASTERBLENDERS as part of a straddle, hedge, conversion, constructive sale, synthetic security, integrated investmentor other risk-reduction transaction for U.S. federal income tax purposes. In addition, the following discussiondoes not address the alternative minimum tax consequences of holding the ordinary shares of D.E MASTERBLENDERS or any tax consequences arising under U.S. state or local or non-U.S. tax laws. Accordingly, D.EMASTER BLENDERS shareholders are encouraged to consult their tax advisors concerning the U.S. federal,state and local and non-U.S. tax consequences to them of the ownership and disposition of ordinary shares of D.EMASTER BLENDERS.

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For purposes of this discussion, a U.S. Holder is a beneficial owner of D.E MASTER BLENDERS ordinaryshares that is, for U.S. federal income tax purposes:

• an individual who is a citizen or a resident of the United States;

• a corporation created or organized under the laws of the United States or any state or politicalsubdivision thereof;

• an estate, the income of which is subject to U.S. federal income taxation regardless of its source; or

• a trust, if (a) a court within the United States is able to exercise primary jurisdiction over itsadministration and one or more United States persons have the authority to control all of its substantialdecisions, or (b) in the case of a trust that was treated as a domestic trust under the law in effect before1997, a valid election is in place under applicable Treasury regulations.

If a partnership (including any entity treated as a partnership for U.S. federal income tax purposes) holdsD.E MASTER BLENDERS ordinary shares, the tax treatment of a partner in such partnership generally willdepend upon the status of the partner and the activities of the partnership. A partner of a partnership holding D.EMASTER BLENDERS ordinary shares should consult its tax advisor regarding the tax consequences of thedistribution and the merger.

Distributions or dividends with respect to D.E MASTER BLENDERS ordinary shares (which for thesepurposes will include the amount of any Dutch taxes withheld therefrom) should generally be includible in thegross income of a U.S. Holder as foreign source dividend income to the extent that such distributions are paid outof the Company’s current or accumulated earnings and profits as determined under U.S. federal income taxprinciples. These dividends generally should be treated as qualified dividends subject to tax at long term capitalgains rates if the shares are held for the specified holding period.

To the extent the Company pays dividends in euros, the amount of any dividend paid to U.S. Holders will beincludible in income in a U.S. dollar amount calculated by reference to the exchange rate in effect on the date ofreceipt, regardless of whether the amount of such dividend is in fact converted into U.S. dollars. If the dividend isconverted into U.S. dollars on the date of receipt, a U.S. Holder should not be required to recognize foreigncurrency exchange gain or loss in respect of the dividend income. A U.S. Holder may have foreign currencyexchange gain or loss if the dividend is converted into U.S. dollars after the date of receipt. In general, foreigncurrency exchange gain or loss will be treated as U.S.-source ordinary gain or loss for foreign tax credit purposes.

Subject to certain limitations, Dutch taxes withheld from or paid on dividend distributions generally will beeligible for credit against the U.S. Holder’s U.S. federal income taxes. The limitation on foreign taxes eligible forcredit is calculated separately with respect to specific classes of income. The foreign tax credit rules are complex,and U.S. Holders are urged to consult their tax advisors regarding the availability of foreign tax credits in theirparticular circumstances. A U.S. Holder will generally recognize a capital gain or loss for U.S. federal incometax purposes on the sale or disposition of D.E MASTER BLENDERS ordinary shares in the same manner as onthe sale or disposition of any other shares held as capital assets and such capital gain or loss will be long-termcapital gain or loss if the U.S. Holder’s holding period for such D.E MASTER BLENDERS ordinary sharesexceeds one year as of the date of sale or disposition. Gain, if any, will generally be U.S. source gain.

Based on the present nature of its activities and the present composition of its assets and sources of income,D.E MASTER BLENDERS does not expect to become for the current year or for any future taxable year apassive foreign investment company (a “PFIC”) for U.S. federal income tax purposes. There can be noassurances, however, that the Company will not be considered to be a PFIC for any particular year because PFICstatus is factual in nature, generally cannot be determined until the close of the taxable year in question, and isdetermined annually. If the Company is classified as a PFIC in any year that a U.S. Holder is a shareholder, theCompany generally will continue to be treated as a PFIC for that U.S. Holder in all succeeding years, regardlessof whether the Company continues to meet the income or asset test described above. If D.E MASTER

119

BLENDERS were a PFIC during any taxable year with respect to a U.S. Holder, additional U.S. federal incometax provisions would be applicable and such U.S. Holder would be required to pay an interest charge togetherwith tax calculated at maximum rates on certain “excess distributions,” defined as including gain on the sale ofcommon stock, or otherwise be subject to certain adverse U.S. federal income tax consequences or, in certaincircumstances, to include in their taxable income certain undistributed amounts of D.E MASTER BLENDERS’income. U.S. Holders are urged to consult their tax advisors with respect to the U.S. federal income taxconsequences to them under the PFIC rules.

Information Reporting with Respect to Foreign Financial Assets. Certain U.S. Holders are required to reportinformation relating to an interest in D.E MASTER BLENDERS ordinary shares, subject to exceptions(including an exception for ordinary shares held in accounts maintained by certain financial institutions), byattaching a completed IRS Form 8938, Statement of Specified Foreign Financial Assets, with their tax return foreach year in which they hold an interest in D.E MASTER BLENDERS ordinary shares. U.S. Holders are urgedto consult their own tax advisors regarding information reporting requirements relating to their ownership of D.EMASTER BLENDERS ordinary shares.

Certain State, Local and Non-U.S. Tax Matters. Holders may be subject to various state, local and non-U.S.taxes and tax filing requirements. Holders are urged to consult their tax advisors with respect to the state, localand non-U.S. tax consequences of acquiring, holding and disposing of the D.E MASTER BLENDERS ordinaryshares.

10F Dividends and Paying Agents

Not applicable

10G Statements by Experts

Not applicable

10H Documents on Display

As long as we are subject to the reporting requirements of the Securities Exchange Act of 1934, we will berequired to file an annual report on Form 20-F within four months of the end of each fiscal year. In addition, weintend to publish our sales performance for the first and third quarters of each year, and our results of operationsfor the first six months of each year and for each full year, as press releases. Press releases relating to financialresults and material events will also be furnished to the SEC on Form 6-K. However, the information we arerequired to file with or furnish to the SEC may be less extensive and less timely compared to that required to befiled with the SEC by U.S. issuers.

The SEC allows us “incorporate by reference” information into this Annual Report on Form 20-F, whichmeans that:

• Incorporated documents are considered part of this Annual Report on Form 20-F; and

• D.E MASTER BLENDERS can disclose important information to you by referring you to thosedocuments.

For further information about us and our ordinary shares, you may inspect a copy of the registrationstatement, of the exhibits and schedules to the registration statement or of any reports, statements or otherinformation we have filed with the SEC without charge at the offices of the SEC at 100 F Street, N.E.,Washington, D.C. 20549, United States. You may obtain copies of all or any part of this Annual Report or our

120

other filings from the Public Reference Section of the SEC, 100 F Street, N.E., Washington, D.C. 20549, UnitedStates, upon the payment of the prescribed fees. You may obtain information on the operation of the PublicReference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains a website at www.sec.gov thatcontains reports and information statements and other information regarding registrants like us that fileelectronically with the SEC. You can also inspect our registration statement on this website. Our filings with theSEC are available through the electronic data gathering, analysis and retrieval (EDGAR) system of the SEC.

You may obtain copies of those documents in the manner described above. You may also request a copy ofthose documents (excluding exhibits) at no cost by contacting us at:

Investor RelationsD.E MASTER BLENDERS 1753 N.V.

Oosterdoksstraat 801011 DK Amsterdam

The NetherlandsTel: +31 20-558-1753

E-mail: investor-relations@DEMB.com

10I Subsidiary Information

Not applicable

ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

Reference is made to pages F-27 through F-28 of the financial statements.

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

Not applicable

PART II

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

None

ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OFPROCEEDS

14A

Not Applicable

14B

Not applicable

14C

Not applicable

121

14D

Not applicable

14E Use of Proceeds

The effective date of the Securities Act registration statement on Form F-1 is June 1, 2012. The ordinaryshares registered pursuant to the F-1 were exchanged for shares of DE US, Inc. on June 28, 2012 in connectionwith the separation that was completed on the same day. We did not receive any proceeds in connection with theseparation.

The amount of expenses incurred in connection with the separation from June 1, 2012 to June 30, 2012 forthe Company’s account in connection with the issuance and distribution of the registered securities wasinsignificant.

122

ITEM 15. CONTROLS AND PROCEDURES

A Disclosure Controls and Procedures

As of the end of the period covered by this Annual Report, our management carried out an evaluation, underthe supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of theeffectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e)and 15d-15(e) under the Securities Exchange Act of 1934). Based on this evaluation, our Chief Executive Officerand Chief Financial Officer have concluded that, as of such date, our disclosure controls and procedures were noteffective in providing reasonable assurance regarding the reliability of financial reporting.

As disclosed elsewhere in this report, amongst other elements, we were required to adjust the historicalfinancial statements contained in this report as a result of improper actions taken by members of our managementin Brazil. At the direction and under the supervision of our audit committee, we conducted an investigation ofthese actions led by independent forensic accountants as well as outside legal counsel. The accountingirregularities identified during the course of the investigation included the overstatement of accounts receivabledue to the failure to write off uncollectible customer discounts, improper recognition of sales revenues prior toshipments to customers, the understatement of provisions for various litigation issues, unsupported expensereversals and postponements, moving inventory out of warehouses that were about to be verified by internal andexternal auditors, the failure to write-off certain obsolete inventory and other inventory valuation issues. Thematerial weakness with respect to our Brazilian operations relates to an ineffective control environment overfinancial reporting maintained by senior management in Brazil which began prior to 2009 through 2012 thatpermitted to go undetected during that period intentional overrides of certain internal controls as well as cross-functional collusion by management in Brazil and communication and actions by senior management in Brazilthat contributed to a lack of adherence to existing internal control procedures and IFRS. The investigation did notfind evidence that these practices spread to operations outside of Brazil. Based on the results of the investigation,we have taken appropriate action to reinforce and enhance the internal control over financial reporting andgovernance and disclosure controls and procedures in our Brazilian operations and we have taken other remedialand disciplinary actions. These remedial actions included making appropriate changes in the Brazilianmanagement and finance teams, including replacing the chief executive officer, the chief financial officer and thelocal controller who are no longer employed by us, adopting enhanced internal audit procedures with respect tothe Brazilian operations, reviewing reporting lines, strengthening the Global Business Practices function inBrazil, and providing additional compliance and business ethics training to relevant departments and employees.

B Management’s annual report on internal control over financial reporting

This Annual Report does not include a report of management’s assessment regarding internal control overfinancial reporting or an attestation report of the Company’s registered public accounting firm due to a transitionperiod established by rules of the SEC for newly public companies.

C Attestation report of the independent registered public accounting firm

Report of Independent Registered Public Accounting Firm

Not applicable

D Changes in internal control over financial reporting

There have been no changes in our internal control over finance reporting during the period covered by thisAnnual Report that have materially affected, or are reasonably likely to affect, our internal control over financialreporting other than in connection with our internal investigation of our internal control over financial reportingwith respect to our Brazilian operations. As disclosed elsewhere in this report, we were required to adjust the

123

historical financial statements contained in this report, amongst other elements, as a result of improper actionstaken by members of our management in Brazil. At the direction and under the supervision of our auditcommittee, we conducted an investigation of these actions led by outside legal counsel and independent forensicaccountants. The accounting irregularities identified during the course of the investigation included theoverstatement of accounts receivable due to the failure to write off uncollectible customer discounts, improperrecognition of sales revenues prior to shipments to customers, the understatement of provisions for variouslitigation issues, unsupported expense reversals and postponements, moving inventory out of warehouses thatwere about to be verified by internal and external auditors, the failure to write-off certain obsolete inventory andother inventory valuation issues. The material weakness with respect to our Brazilian operations relates to anineffective control environment over financial reporting maintained by senior management in Brazil which beganprior to 2009 through 2012 that permitted to go undetected during that period intentional overrides of certaininternal controls as well as cross-functional collusion by management in Brazil and communication and actionsby senior management in Brazil that contributed to a lack of adherence to existing internal control proceduresand IFRS. The investigation did not find evidence that these practices spread to operations outside of Brazil.Based on the results of the investigation, we have taken appropriate action to reinforce and enhance the internalcontrol over financial reporting and governance and disclosure controls and procedures in our Brazilianoperations and we have taken other remedial and disciplinary actions. These remedial actions included makingappropriate changes in the Brazilian management and finance teams, including replacing the chief executiveofficer, the chief financial officer and the local controller who are no longer employed by us, adopting enhancedinternal audit procedures with respect to the Brazilian operations, reviewing reporting lines, strengthening theGlobal Business Practices function in Brazil, and providing additional compliance and business ethics training torelevant departments and employees.

ITEM 16A AUDIT COMMITTEE FINANCIAL EXPERT

The Board has determined that Mr. Van Lede qualifies as an audit committee financial expert as defined bythe SEC and is independent within the meaning of the Dutch Corporate Governance Code.

ITEM 16B CODE OF ETHICS

On June 28, 2012, D.E MASTER BLENDERS adopted a Code of Conduct, which contains D.E MASTERBLENDERS’ ethical principles in relation to various subjects. The Code of Conduct is posted on our website—www.demasterblenders1753.com.

The Code of Conduct applies to D.E MASTER BLENDERS employees worldwide, including D.EMASTER BLENDERS’ principal executive officer, principal financial officer, principal accounting officer orcontroller and persons performing similar functions.

In fiscal 2012, no amendments were made to, and no waivers were granted in respect of the Code ofConduct.

ITEM 16C PRINCIPAL ACCOUNTANT FEES AND SERVICES

PricewaterhouseCoopers Accountants N.V. has served as D.E MASTER BLENDERS’ independent publicaccountant for the period ended June 30, 2012, for which audited financial statements appear in this AnnualReport.

124

The following table presents the aggregate fees for professional services and other services rendered byPricewaterhouseCoopers Accountants N.V. to Sara Lee on behalf of the business that became D.E MASTERBLENDERS in 2012.

Fees PricewaterhouseCoopers Accountants N.V.

Amounts in thousands of euro 2012

Audit of the financial statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 4,226Audit related engagements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 8,535

Tax advisory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 9,407Other non-audit related services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 5,550

Total audit fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €27,718Which relate to:PricewaterhouseCoopers Accountants N.V. . . . . . . . . . . . . . . . . . . . . . . €10,648Network of PricewaterhouseCoopers Accountants N.V . . . . . . . . . . . . . €17,070

Audit committee Pre-approval Policies and Procedures

The audit committee is required to pre-approve (either generally or specifically) all audit related, tax andother services proposed by the external auditor in order to assure that the services do not impair the externalauditor’s independence from D.E MASTER BLENDERS.

In connection with both types of pre-approval, the audit committee must consider whether such services areconsistent with all applicable regulations and stock exchange rules on auditor independence.

When pre-approval is received from the audit committee, the external auditor may be engaged for theservice. However, it does not replace management’s responsibility to approve the service in line with D.EMASTER BLENDERS’ policies on cost and procurement of services. All engagements of the external auditormust be pre-approved before final approval by the relevant line manager.

Non-recurring assignments with a fee above a certain amount require specific pre-approval from thechairman of the audit committee.

ITEM 16D EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

Not applicable

ITEM 16E PURCHASE OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATEDPURCHASERS

Not applicable

ITEM 16F CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT

Not applicable

ITEM 16G CORPORATE GOVERNANCE

Not applicable

125

ITEM 16H MINE SAFETY DISCLOSURE

Not applicable

PART III

ITEM 17. FINANCIAL STATEMENTS

See Item 18.

126

ITEM 18. FINANCIAL STATEMENTS

TABLE OF CONTENTS

Page

CONSOLIDATED FINANCIAL STATEMENTS FOR THE FISCAL YEARS ENDED 30 JUNE 2012,2 JULY 2011 AND 3 JULY 2010

Report of Independent Registered Public Accounting Firm . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-2Consolidated Income Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-3Consolidated Statements of Comprehensive Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-4Consolidated Statements of Financial Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-5Consolidated Statements of Changes in Equity/Parent’s Net Investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-6Consolidated Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-7Notes to the Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-8COMPANY FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED 30 JUNE 2012Company Income Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-77Company Statement of Financial Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-78Notes to the Company Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-79Other Information

F-1

Report of Independent Registered Public Accounting Firm

To: the Board of Directors and Stockholders of D.E MASTER BLENDERS 1753 N.V:

In our opinion, the accompanying consolidated statements of financial position and the related consolidatedincome statements, consolidated statements of comprehensive income, of changes in equity / parent’s netinvestment and of cash flows, as set out on pages F-3 through F-76, present fairly, in all material respects, thefinancial position of D.E MASTER BLENDERS 1753 N.V. and its subsidiaries at 30 June 2012, 2 July 2011 and3 July 2010 and the results of their operations and their cash flows for each of the three years in the period ended30 June, 2012 in conformity with International Financial Reporting Standards as issued by the InternationalAccounting Standards Board and in conformity with International Financial Reporting Standards as adopted bythe European Union. These financial statements are the responsibility of the Company’s management. Ourresponsibility is to express an opinion on these financial statements based on our audits. We conducted our auditsof these statements in accordance with the standards of the Public Company Accounting Oversight Board (UnitedStates). Those standards require that we plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free of material misstatement. An audit includes examining, on a test basis, evidencesupporting the amounts and disclosures in the financial statements, assessing the accounting principles used andsignificant estimates made by management, and evaluating the overall financial statement presentation. Webelieve that our audits provide a reasonable basis for our opinion.

As discussed in Note 1, D.E MASTER BLENDERS 1753 N.V. did not operate as an entity separate from SaraLee Corporation through 28 June, 2012. Therefore, these financial statements may not necessarily be indicativeof results that would have occurred had D.E MASTER BLENDERS 1753 N.V. been a separate stand-alone entityin that period.

As discussed in Note 1 to the consolidated financial statements, the Company restated its 2011 and 2010consolidated financial statements to correct for errors.

PricewaterhouseCoopers Accountants N.V.Amsterdam, The Netherlands11 October 2012

/s/ Huub C. Wüst RA

F-2

D.E MASTER BLENDERS 1753 N.V.

CONSOLIDATED INCOME STATEMENTSFOR THE FISCAL YEARS ENDED 30 JUNE 2012, 2 JULY 2011 AND 3 JULY 2010(All amounts in thousands of Euro, except per share data)

Note 20122011

Restated*2010

Restated*

SALES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 € 2,795,018 € 2,593,314 € 2,313,363COST OF SALES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 (1,787,088) (1,611,567) (1,347,634)

GROSS PROFIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,007,930 981,747 965,729SELLING, GENERAL AND ADMINISTRATIVE

EXPENSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 (898,219) (656,488) (623,796)

OPERATING PROFIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109,711 325,259 341,933

FINANCE INCOME, NET . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 132,194 91,844 55,299FINANCE COSTS, NET . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 17,442 (45,430) 14,668SHARE OF PROFIT FROM ASSOCIATE . . . . . . . . . . . . . . . . 9 191 2,233 2,702

PROFIT BEFORE INCOME TAXES . . . . . . . . . . . . . . . . . . . . 259,538 373,906 414,602INCOME TAX EXPENSE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 (127,347) (110,663) (174,859)

PROFIT FOR THE YEAR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 132,191 € 263,243 € 239,743

EARNINGS PER SHARE-BASIC AND DILUTED . . . . . . . . . 17 0.22 0.44 0.40

* see Note 1

The accompanying notes to the consolidated financial statements are an integral part of these statements.

F-3

D.E MASTER BLENDERS 1753 N.V.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOMEFOR THE FISCAL YEARS ENDED 30 JUNE 2012, 2 JULY 2011 AND 3 JULY 2010(All amounts in thousands of Euro)

Note 20122011

Restated*2010

Restated*

PROFIT FOR THE YEAR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €132,191 €263,243 239,743

OTHER COMPREHENSIVE INCOME:Retirement benefit obligation related items—net of tax of

€30,883, €11,913 and €10,662 . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 (23,084) 182 (90,162)Foreign currency translation—net of tax of nil . . . . . . . . . . . . . . . . . 47,499 (2,225) 111,886

Total other comprehensive income (loss)—net of tax . . . . . . . . . . . 24,415 (2,043) 21,724

TOTAL COMPREHENSIVE INCOME FOR THE YEAR . . . . . . . . . . . 156,606 261,200 261,467

* see Note 1

The accompanying notes to the consolidated financial statements are an integral part of these statements.

F-4

D.E MASTER BLENDERS 1753 N.V.

CONSOLIDATED STATEMENTS OF FINANCIAL POSITIONAS OF 30 JUNE 2012, 2 JULY 2011 AND OPENING FINANCIAL POSITION AS OF 3 JULY 2010(All amounts in thousands of Euro)

Note 20122011

Restated*

OpeningStatement of

FinancialPosition

Restated*

ASSETSNONCURRENT ASSETS:

Property, plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 € 377,437 € 369,861 € 365,644Goodwill and other intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 386,817 268,239 243,618Investments in associate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 12,567 15,675 15,161Deferred income tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 91,418 59,497 65,648Derivative financial instruments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 — 153 691Other noncurrent financial assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 46,855 21,322 21,375Retirement benefit asset . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 150,193 12,796 632Receivables from Sara Lee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 — 494,826 —

1,065,287 1,242,369 712,769

CURRENT ASSETS:Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 404,863 437,545 308,839Receivables from Sara Lee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 — 1,221,531 1,849,259Trade and other receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 421,593 335,043 295,594Income tax receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,634 2,187 1,802Derivative financial instruments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 22,268 6,824 21,930Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 220,343 1,342,594 663,762

1,098,701 3,345,724 3,141,186

TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €2,163,988 €4,588,093 €3,853,955

EQUITY/PARENT’S NET INVESTMENT AND LIABILITIESEQUITY:

Share capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71,383 — —Additional paid in capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 417,363 — —Other reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (171,148) (195,563) (193,520)Parent’s net investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 3,466,630 2,712,457

16 € 317,598 €3,271,067 €2,518,937

NONCURRENT LIABILITIES:Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 528,958 17,316 321,763Retirement benefit obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 109,461 32,256 106,015Deferred income tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 47,263 35,780 38,432Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 52,077 33,905 34,183Other noncurrent liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 73,516 52,630 54,872

811,275 171,887 555,265

CURRENT LIABILITIES:Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 28,456 345,819 9,020Payables to Sara Lee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 — 1,120 3,225Trade and other payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 630,543 563,260 478,060Income taxes payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 294,615 186,014 236,680Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 66,005 39,879 32,483Derivative financial instruments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 15,496 9,047 20,285

1,035,115 1,145,139 779,753

TOTAL EQUITY/PARENT’S NET INVESTMENT ANDLIABILITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €2,163,988 €4,588,093 €3,853,955

* see Note 1

The accompanying notes to the consolidated financial statements are an integral part of these statements.

F-5

D.E MASTER BLENDERS 1753 N.V.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY/PARENT’S NET INVESTMENTFOR THE FISCAL YEARS ENDED 30 JUNE 2012, 2 JULY 2011 AND OPENING STATEMENT OFFINANCIAL POSITION AS OF 3 JULY 2010(All amounts in thousands of Euro)

Parent’s NetInvestment

Other Reserves

TotalParent’s NetInvestment/

EquitySharecapital

Additionalpaid incapital

RetirementBenefit

ObligationRelated Items

CurrencyTranslation

Reserve

TotalOther

reserves

BALANCE—As of fiscal year 2009as reported . . . . . . . . . . . . . . . . . . . — — 3,050,725 (105,606) (108,328) (213,934) 2,836,791

Restatement adjustments* . . . . . — — (27,342) — (1,310) (1,310) (28,652)

BALANCE—As of fiscal year 2009as restated . . . . . . . . . . . . . . . . . . . — — 3,023,383 (105,606) (109,638) (215,244) 2,808,139

Profit for the year as restated . . . — — 239,743 — — — 239,743Retirement benefit obligation

related items . . . . . . . . . . . . . . — — — (90,162) — (90,162) (90,162)Foreign currency translation as

restated . . . . . . . . . . . . . . . . . . — — — — 111,886 111,886 111,886Contributions from

(distributions to) Sara Lee . . . — — (550,669) — — — (550,669)

BALANCE—As of fiscal year 2010as restated . . . . . . . . . . . . . . . . . . . — — 2,712,457 (195,768) 2,248 (193,520) 2,518,937

Profit for the year as restated . . . — — 263,243 — — — 263,243Retirement benefit obligation

related items . . . . . . . . . . . . . . — — — 182 — 182 182Foreign currency translation as

restated . . . . . . . . . . . . . . . . . . — — — — (2,225) (2,225) (2,225)Contributions from

(distributions to) Sara Lee . . . — — 490,930 — — — 490,930

BALANCE—As of fiscal year 2011as restated . . . . . . . . . . . . . . . . . . . — — 3,466,630 (195,586) 23 (195,563) 3,271,067

Profit for the year . . . . . . . . . . . . — — 132,191 — — — 132,191Retirement benefit obligation

related items . . . . . . . . . . . . . . — — — (23,084) (23,084) (23,084)Foreign currency translation . . . — — — — 47,499 47,499 47,499Contributions from

(distributions to) Sara Lee . . . — — 71,897 — — — 71,897Special dividend paid by DE

US, Inc.* . . . . . . . . . . . . . . . . — — (1,419,150) (1,419,150)Impact of Separation from Sara

Lee . . . . . . . . . . . . . . . . . . . . . — — (1,762,822) — — — (1,762,822)Issuance of Company common

stock and formation ofGroup . . . . . . . . . . . . . . . . . . . 71,383 417,363 (488,746) — — — —

BALANCE—As of fiscal year2012 . . . . . . . . . . . . . . . . . . . . . . . . 71,383 417,363 — (218,670) 47,522 (171,148) 317,598

* see Note 1

The accompanying notes to the consolidated financial statements are an integral part of these statements.

F-6

D.E MASTER BLENDERS 1753 N.V.

CONSOLIDATED STATEMENTS OF CASH FLOWSFOR THE FISCAL YEARS ENDED 30 JUNE 2012, 2 JULY 2011 AND 3 JULY 2010(All amounts in thousands of Euro)

Note 20122011

Restated*2010

Restated*

NET CASH PROVIDED BY OPERATING ACTIVITIES . . . . 30 € 102,453 € 281,685 € 364,846

CASH FLOWS FROM INVESTING ACTIVITIES:Purchases of property, plant and equipment . . . . . . . . . . . . 6 (97,311) (77,477) (65,708)Proceeds from the sale of property, plant and equipment . . 6 4,277 1,096 1,787Purchases of intangibles . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 (134,974) (8,126) (4,070)Dividends received from associates . . . . . . . . . . . . . . . . . . . 9 588 2,299 3,001Acquisition of businesses, net of cash acquired . . . . . . . . . . 8 (23,367) (24,084) —Interest received . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 22,346 20,244 15,711Interest received from Sara Lee . . . . . . . . . . . . . . . . . . . . . . 29 80,605 28,511 36,199Loans made to Sara Lee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 (4,692,710) (3,406,941) (786,545)Repayments of loans made to Sara Lee . . . . . . . . . . . . . . . . 29 5,297,286 3,535,365 1,152,957Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (23) 420

Net cash provided by/(used in) investing activities . . . . . . . . . . . 456,740 70,864 353,752

CASH FLOWS FROM FINANCING ACTIVITIES:Repayments of short-term borrowings . . . . . . . . . . . . . . . . . 19 (1,433) (55,384) (5,124)Proceeds from short-term borrowings . . . . . . . . . . . . . . . . . 19 4 54,965 992Repayments of bridge loans . . . . . . . . . . . . . . . . . . . . . . . . . 19 (2,895,753) — —Proceeds from bridge loans . . . . . . . . . . . . . . . . . . . . . . . . . 19 2,895,753 — —Repayments of long-term debt . . . . . . . . . . . . . . . . . . . . . . . 19 (474,252) (175,836) (329,420)Proceeds from long-term debt issuance . . . . . . . . . . . . . . . . 19 150,005 189,247 346,262Repayment of financing leases . . . . . . . . . . . . . . . . . . . . . . . — (650) (853)Interest paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (21,478) (14,788) (9,084)Special dividend paid by DE US, Inc.* . . . . . . . . . . . . . . . . (1,419,150) — —Transfers (to)/from Parent, net . . . . . . . . . . . . . . . . . . . . . . . 80,398 342,632 (566,826)

Net cash provided by/(used in) financing activities . . . . . . . . . . . (1,685,906) 340,186 (564,053)

EFFECT OF EXCHANGE RATE CHANGES ON CASH . . . . . 2,946 (11,740) 401

NET INCREASE/(DECREASE) IN CASH AND CASHEQUIVALENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,123,767) 680,995 154,946

CASH AND CASH EQUIVALENTS—Beginning of fiscalyear . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 1,339,049 658,054 503,108

CASH AND CASH EQUIVALENTS—End of fiscal year . . . . . 15 € 215,282 € 1,339,049 € 658,054

* see Note 1

The accompanying notes to the consolidated financial statements are an integral part of these statements.

F-7

D.E MASTER BLENDERS 1753 N.V.NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. DESCRIPTION OF BUSINESS AND BASIS OF PREPARATION

On 28 June 2012, the international coffee and tea business of then Sara Lee Corporation (“Sara Lee” or“Parent”) was spun-off (the “Separation”) into D.E MASTER BLENDERS 1753 N.V. (“D.E MASTERBLENDERS” or the “Company”). D.E MASTER BLENDERS, previously D.E MASTER BLENDERS 1753B.V., was formed on 27 February 2012 for the purpose of becoming the parent company of the internationalcoffee and tea business of Sara Lee. D.E MASTER BLENDERS is a separate publicly traded companyincorporated under the laws of the Netherlands.

To effectuate the Separation a number of transactions were entered into to separate the international coffeeand tea business of Sara Lee and for D.E MASTER BLENDERS to become the parent company of the business.These transactions included the distribution by Sara Lee of all of the outstanding shares of common stock of awholly owned subsidiary, DE US, Inc. to Sara Lee’s shareholders. Subsequent to the distribution, DE US, Inc.merged with a wholly owned subsidiary of D.E MASTER BLENDERS, with DE US, Inc. surviving the mergeras a subsidiary of D.E MASTER BLENDERS. To accomplish the merger, 594,859,274 D.E MASTERBLENDERS ordinary shares were exchanged for the previously distributed shares of DE US, Inc. common stock.Each of the holders of Sara Lee common stock, who were also the beneficial owners of DE US, Inc., receivedone ordinary share of D.E MASTER BLENDERS in respect of each share of Sara Lee common stock.

The references to the Group throughout these financial statements are to the combined international coffeeand tea business of Sara Lee for the periods prior to Separation and to D.E MASTER BLENDERS and itsconsolidated subsidiaries for the periods after the Separation. The financial results for the periods prior toSeparation represent the combined results of the Group and were prepared based on the principles describedbelow.

These financial statements were authorised for issuance on 11 October 2012 by the board of directors ofD.E MASTER BLENDERS.

Nature of Business—The Group consists of global operations with headquarters in the Netherlands. Itoffers innovative coffee and tea products that are well-known in retail and out of home markets across Europe,Brazil, Australia and Thailand. The Group is currently organised into three operating segments: Retail—WesternEurope, Retail—Rest of World and Out of Home.

Within the Retail—Western Europe and Retail—Rest of World segments, the Group’s principal productsare roast and ground multi-serve coffee, roast and ground single-serve coffee pads and capsules, instant coffeeand tea. D.E MASTER BLENDERS sells its products predominantly to supermarkets, hypermarkets and throughinternational buying groups.

In the Out of Home segment, the Group offers a full range of hot beverage products but focuses on its liquidroast products and related coffee machines. The Group’s products are sold either directly to businesses, hotels,hospitals and restaurants or to foodservice distributors for distribution to the customer. The Out of Homesegment strives to offer a total coffee solution, depending on its customers’ needs.

The Group’s fiscal year ends on the Saturday closest to 30 June. Fiscal years 2012 and 2011 were 52-weekyears and 2010 was a 53-week year. References throughout these financial statements to fiscal year 2012represent the period as of 30 June 2012 and for the fiscal year then ended; references to fiscal year 2011 representthe period as of 2 July 2011 and for the fiscal year then ended; and references to fiscal year 2010 represent theperiod as of 3 July 2010 and for the fiscal year then ended.

F-8

Impact of the Separation—There were a number of transactions between Sara Lee and the Group prior tothe formation of D.E MASTER BLENDERS in connection with the Separation. The transactions include but arenot limited to, the following:

• Debt exchange: On 15 May, 2012, DE US, Inc. issued $2.1 billion of senior notes to Sara Lee inexchange for the contribution of the international coffee and tea business, to the Group. In connectionwith the Separation of the international coffee and tea business Sara Lee transferred $650 million ofthese notes to third parties in satisfaction of its obligations. This resulted in a portion of the Group’sobligations under the DE US, Inc. debt securities transferring from Sara Lee to the third party noteholders. Sara Lee also transferred the remaining DE US, Inc. debt securities to certain subsidiaries ofthe Group in a non-cash settlement of amounts due to the same subsidiaries of the Group. This resultedin a non-cash reduction in the receivables from Sara Lee and a non-cash issuance of debt, which,accordingly, are not reflected in the consolidated statement of cash flows.

• Settlement of amounts due from/to Sara Lee: The Group settled substantially all remaining amountsoutstanding with Sara Lee in connection with the Separation.

• Bridge Financing: DE US, Inc. and D.E MASTER BLENDERS each entered into separate bridgefinancing arrangements that were each individually for $1.8 billion. The proceeds from the bridgefinancing by DE US, Inc. was used to fund the payment of a special cash dividend issued toshareholders at the time of the Separation. The bridge financing by D.E MASTER BLENDERS wasused to repay DE US, Inc.’s bridge loan and was fully repaid by D.E MASTER BLENDERS prior toyear-end with cash on hand.

• Special dividend: On 28 June 2012 DE US, Inc. declared a special cash dividend of $3.00 per share toeach shareholder of DE US, Inc. on record as of 14 June 2012, which resulted in a cash payment of$1.8 billion (approximately €1.4 billion).

• Working capital contributed from Sara Lee: As part of the Separation agreement, the Group receivedall remaining working capital of the household and bodycare and international bakery businesses thatwere previously disposed of by Sara Lee. The total contribution was €6.0 million.

• Net liabilities assumed from Sara Lee: As part of the Separation, apart from contingent liabilities, theGroup assumed € 241.6 million of certain liabilities related to businesses previously disposed of bySara Lee. These liabilities primarily relate to Sara Lee’s household and body care business and itsinternational bakery business. These liabilities include certain legal claims, uncertain tax liabilities,restructuring obligations, indemnifications, and retirement benefit obligations including relateddeferred taxes, which are unrelated to the Group’s operations. The amount of the assets and liabilitiesassumed and net assets contributed at the date of Separation were as follows (all amounts in millions ofeuro):

Deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 2.8Income taxes payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119.0Net pension obligation (see Note 22) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55.0Provisions (see Note 23) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34.8Other noncurrent liabilities—indemnification (see Note 24) . . . . . . . . . . . . . . . . . . 30.0

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €241.6

• The Group has also adjusted its income tax payables to reflect the actual tax payables of the legalentities within the Group as of 30 June 2012. The Group also adjusted its deferred tax balances andincome taxes payable to reflect the impact of its actual net operating losses (see Note 21). Theseadjustments are a result of the income tax balances prior to the Separation being prepared on a separatecompany basis as opposed to consolidated post Separation.

F-9

As a result of the items described above, there was a net decrease of €3.1 billion in equity for fiscal year2012. See Note 16 for further details.

Basis of Preparation

The Group has prepared these consolidated financial statements in accordance with International FinancialReporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and inconformity with IFRS as adopted by the European Union.

Combined Group—Prior to Separation

The financial information with respect to the international coffee and tea business prior to Separation isreflected in the individual legal entities that comprise the Group. These combined financial statements have beenprepared from the accounting records of Sara Lee and reflect the cash flows, revenues, expenses, assets, andliabilities of these individual legal entities. Because the separate legal entities that comprise the Group were notheld by a single legal entity prior to Separation, Parent’s net investment is shown in lieu of shareholders’ equityin these combined financial statements. Parent’s net investment represents the cumulative net investment by SaraLee in the Group through that date. The impact of transactions between the Group and Sara Lee that were nothistorically settled in cash are also included in Parent’s net investment.

The Group includes legal entities that are responsible for and have managed certain liabilities associatedwith a branded apparel business (“Branded Apparel”) that was disposed of by Sara Lee prior to fiscal year 2009.These liabilities, which include pension, medical claims and environmental obligations, are therefore reflected inthe combined financial statements of the Group along with any related expenses incurred during the financialstatement periods presented herein.

During the periods presented, the Group functioned as part of the larger group of companies controlled bySara Lee, and accordingly, Sara Lee performed certain corporate overhead functions for the Group. Thesefunctions include, but are not limited to, executive oversight, legal, finance, human resources, internal audit,financial reporting, tax planning and investor relations. The costs of such services have been allocated to theGroup based on the most relevant allocation method to the service provided, primarily based on relativepercentage of revenue or headcount. Management believes such allocations are reasonable; however, they maynot be indicative of the actual expense that would have been incurred had the Group been operating as a separateentity apart from Sara Lee. The cost allocated for these functions is included in selling, general andadministrative expenses in the combined income statements for the historical periods presented. A completediscussion of the Group’s relationship with Sara Lee, together with the cost allocations, is included in Note 29 tothe combined financial statements.

As the Group did not operate as a stand-alone entity in the past, these combined financial statements maynot be indicative of the Group’s future performance and do not necessarily reflect what its combined results ofoperations, financial position and cash flows would have been had the Group operated as a separate entity apartfrom Sara Lee during the periods presented.

Consolidated Group—Separation

The contribution of Sara Lee’s international coffee and tea business into the Company has been accountedfor based on the Group’s accounting policy for common control transactions. Accordingly, the assets, liabilitiesand results of operations of the international coffee and tea business are presented for all periods based on thecarrying values recognised in the combined financial statements of the Group immediately prior to theSeparation. The Parent’s Net Investment has been converted into share capital and additional paid in capital andretained earnings as described in Note 16.

F-10

The financial statements for all periods have been prepared under the historical cost convention as modifiedby the revaluation of certain financial assets and liabilities. Other than transactions which were part of theformation of the Group or the Separation from Sara Lee, the results of subsidiaries and associates acquired duringthe period are included in the income statement from the effective date of acquisition or up to the effective dateof disposal, as appropriate.

The preparation of financial statements in conformity with IFRS requires the use of certain criticalaccounting estimates. It also requires management to exercise its judgment in the process of applying theGroup’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas whereassumptions and estimates are significant to the consolidated financial statements are disclosed in Note 4.

RESTATEMENT OF PRIOR FINANCIAL STATEMENTS

On 1 August 2012, the Group announced it had identified accounting irregularities and certain other errorsinvolving previously issued financial results for its Brazilian operations, which would require the restatement oftheir historical financial statements. An investigation was conducted led by independent forensic accountants aswell as outside legal counsel. The accounting irregularities and certain other errors identified during the course ofthe investigation included the overstatement of accounts receivable due to the failure to write-off uncollectiblecustomer discounts, improper recognition of sales revenues prior to shipments to customers, the understatementof provisions for various litigation issues unsupported expense reversals and postponements, moving inventoryout of warehouses that were about to be verified by internal and external auditors, the failure to write-off certainobsolete inventory and other inventory valuation issues. The investigation revealed that these accountingirregularities occurred in the context of an ineffective control environment on financial reporting maintained bysenior management in Brazil which began prior to 2009 through 2012 that permitted to go undetected during thatperiod intentional overrides of certain internal controls as well as cross-functional collusion by management inBrazil and communication and actions by senior management that contributed to a lack of adherence to existinginternal control procedures and IFRS.

F-11

The Group has restated its comparative financial information in its current financial statements for fiscal years2010 and 2011 to reflect the correction of the following accounting errors. The impact of the restatement is as follows(amounts in thousands of euro):

Fiscal year 2011Opening statementof financial position Comparative Period(a)

Previouslyreported Adjustments Restated

Previouslyreported Adjustments Restated

Previouslyreported Adjustments Restated

STATEMENT OF FINANCIAL POSITIONNoncurrent assets:

Deferred income taxassets . . . . . . . . . . . . . 53,074 6,423 59,497 60,928 4,720 65,648 56,187 166 56,353

Other noncurrentassets . . . . . . . . . . . . . 1,182,873 (1) 1,182,872 647,121 — 647,121 654,013 — 654,013

Total noncurrentassets . . . . . . . . . . . . . 1,235,947 6,422 1,242,369 708,049 4,720 712,769 710,200 166 710,366

Current assets:Inventories . . . . . . . . . . 414,416 23,129 437,545 288,260 20,579 308,839 255,437 20,297 275,734Trade and other

receivables . . . . . . . . 411,027 (75,984) 335,043 362,897 (67,303) 295,594 344,717 (54,236) 290,481Other current assets . . . 2,573,135 1 2,573,136 2,536,753 — 2,536,753 2,728,106 — 2,728,106

Total current assets . . . . 3,398,578 (52,854) 3,345,724 3,187,910 (46,724) 3,141,186 3,328,260 (33,939) 3,294,321

Total assets . . . . . . . . . . . . . 4,634,525 (46,432) 4,588,093 3,895,959 (42,004) 3,853,955 4,038,460 (33,773) 4,004,687

Parent’s net investment:Parent’s net

investment . . . . . . . . 3,503,852 (37,222) 3,466,630 2,743,790 (31,332) 2,712,457 3,050,725 (27,342) 3,023,383Other comprehensive

income (loss) . . . . . . (192,091) (3,472) (195,563) (188,548) (4,973) (193,520) (213,934) (1,310) (215,244)

Total parent’s netinvestment . . . . . . . . 3,311,761 (40,694) 3,271,067 2,555,242 (36,305) 2,518,937 2,836,791 (28,652) 2,808,139

Noncurrent liabilities: . . . . 171,887 — 171,887 555,265 — 555,265 479,893 — 479,893

Current liabilities:Trade and other

payables . . . . . . . . . . 570,159 (6,899) 563,260 484,801 (6,741) 478,060 448,225 (6,130) 442,095Income taxes

payable . . . . . . . . . . . 186,014 — 186,014 236,678 2 236,680 206,096 (1) 206,095Provisions . . . . . . . . . . . 38,718 1,161 39,879 31,443 1,040 32,483 35,781 1,010 36,791Other current

liabilities . . . . . . . . . . 355,986 — 355,986 32,530 — 32,530 31,674 — 31,674

Total currentliabilities . . . . . . . . . . 1,150,877 (5,738) 1,145,139 785,452 (5,699) 779,753 721,776 (5,121) 716,655

Total parent’s netinvestment andliabilities . . . . . . . . . . . . . 4,634,525 (46,432) 4,588,093 3,895,959 (42,004) 3,853,955 4,038,460 (33,773) 4,004,687

(a) The comparative period represents the statement of financial position as of 27 June 2009 (the end of fiscal year2009). This additional period is presented as these amounts represent the adjustment made to the opening balancesfor the fiscal year 2010 (i.e. the earliest period presented).

F-12

Fiscal year 2011 Fiscal year 2010

Previouslyreported Adjustment Restated

Previouslyreported Adjustment Restated

INCOME STATEMENTSales . . . . . . . . . . . . . . . . . . . . . . . 2,601,556 (8,242) 2,593,314 2,315,493 (2,130) 2,313,363Cost of sales . . . . . . . . . . . . . . . . . (1,616,594) 5,027 (1,611,567) (1,346,117) (1,517) (1,347,634)

Gross Profit . . . . . . . . . . . . . . . . . 984,962 (3,215) 981,747 969,376 (3,647) 965,729Selling, general and

administrative expenses . . . . . . (653,623) (2,865) (656,488) (622,677) (1,119) (623,796)

Operating profit . . . . . . . . . . . . . . 331,339 (6,080) 325,259 346,699 (4,766) 341,933Finance income, net . . . . . . . . . . . 91,844 — 91,844 55,299 — 55,299Finance costs, net . . . . . . . . . . . . . (45,430) — (45,430) 14,668 — 14,668Share of profit from associate . . . 2,233 — 2,233 2,702 — 2,702

Profit before income taxes . . . . . . 379,986 (6,080) 373,906 419,368 (4,766) 414,602Income tax expense . . . . . . . . . . . (104,029) (6,634) (110,663) (179,406) 4,547 (174,859)

Profit for the year . . . . . . . . . . . . . 275,957 (12,714) 263,243 239,962 (219) 239,743

Earnings per share—basic anddiluted . . . . . . . . . . . . . . . . . . . . € 0.46 (0.02) € 0.44 € 0.40 — € 0.40

Fiscal year 2011 Fiscal year 2010

Previouslyreported Adjustment Restated

Previouslyreported Adjustment Restated

STATEMENT OF COMPREHENSIVE INCOMEProfit for the year . . . . . . . . . . . . . . . . . . . . . . . . 275,957 (12,714) 263,243 239,962 (219) 239,743Other comprehensive income:

Retirement benefit obligation relateditems—net of tax of €30,883 and€11,913 . . . . . . . . . . . . . . . . . . . . . . . . . . 182 — 182 (90,162) — (90,162)

Foreign currency translation—net of tax ofnil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,725) 1,500 (2,225) 115,548 (3,662) 111,886

Total other comprehensive income(loss)—net of tax . . . . . . . . . . . . . . . . . . (3,543) 1,500 (2,043) 25,386 (3,662) 21,724

Total comprehensive income for the year . . . . . 272,414 (11,214) 261,200 265,348 (3,881) 261,467

The statements of cash flows for the fiscal years 2010 and 2011 were restated for the decrease in the profitfor the year for €0.2 million and €12.7 million, respectively. This decrease was offset by movements in otheritems within net cash provided by operating activities.

Substantially all adjustments relate to the Retail–Rest of World segment.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these financial statements are set out below.These policies have been consistently applied to all the years presented, unless otherwise stated.

Accounting Convention—The financial statements are prepared on a historical cost basis except forfinancial instruments recorded at fair value or stated otherwise.

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Use of Estimates—IFRS requires the use of certain critical accounting estimates. It also requiresmanagement to exercise its judgement in the process of applying the Group’s accounting policies. The areasinvolving a higher degree of judgement or complexity, or areas where assumptions and estimates are significantto the financial statements are disclosed in Note 4.

Basis of Consolidation—The financial statements include the accounts of all subsidiaries in which entitiesin the Group have a controlling financial interest.

Subsidiaries—Subsidiaries are all entities where the Group has the power to govern the financial andoperating policies so as to obtain benefits from their activities. Generally, control is presumed to exist when theGroup holds more than half of the voting rights in an entity. The entities are consolidated from the date on whichcontrol is transferred to the Group until the date control ceases. During the years presented, the Group has notconsolidated any entities where it owned less than 50% of the equity of such entities.

Intergroup transactions, balances and unrealised gains and losses on transactions between companies withinthe Group are eliminated upon consolidation unless they provide evidence of impairment.

Transactions with non-controlling interests that do not result in loss of control are accounted for as equitytransactions—that is, as transactions with the owners in their capacity as owners. The difference between fairvalue of any consideration paid and the relevant share acquired of the carrying value of net assets of thesubsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded inequity.

Associates—Associates are entities over which the Group has the ability to exercise significant influence,but does not control. Generally, significant influence is presumed to exist when the Group holds 20% to 50% ofthe voting rights in an entity. Investments in associates are accounted for using the equity method of accountingand are initially recognised at cost. The Group’s investment in associates includes goodwill identified onacquisition, net of any accumulated impairment loss.

The financial statements include the Group’s share of the total recognised gains and losses of associatesfrom the date that significant influence commences until the date significant influence ceases, adjusted for anyimpairment loss. The cumulative post-acquisition gains or losses are adjusted against the carrying amount of theinvestment. When the Group’s share of losses in an associate equals or exceeds its interest in the associate,including any other unsecured receivables, the Group does not recognise further losses, unless it has incurredobligations or made payments on behalf of the associate. Unrealised gains on transactions between the Group andits associates are eliminated to the extent of the Group’s interest in the associates. Unrealised losses are alsoeliminated unless the transaction provides evidence of an impairment of the asset transferred.

Business Combinations—The Group uses the acquisition method to account for business combinations.The consideration transferred for the acquisition of a subsidiary is the fair value of the assets transferred, theliabilities incurred and the equity interests issued by the Group and includes the fair value of any asset or liabilityresulting from a contingent consideration arrangement. Acquisition-related costs are expensed as incurred.Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination aremeasured initially at their fair values at the acquisition date. On an acquisition-by-acquisition basis, the Grouprecognises any non-controlling interest in the acquiree either at fair value or at the non-controlling interest’sproportionate share of the acquiree’s net assets.

The excess of the consideration transferred over the fair value of the Group’s share of the identifiable netassets acquired is recorded as goodwill. To the extent applicable, any non-controlling interest in the acquiree andthe acquisition-date fair value of any previous equity interest in the acquiree are added to considerationtransferred for purposes of calculating goodwill. If this is less than the fair value of the net assets of thesubsidiary acquired in the case of a bargain purchase, the difference is recognised directly in the incomestatements.

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Common Control Transactions—The assets (including goodwill, if any) and liabilities acquired fromentities under common control are recorded at the carrying value recognised by the transfer. The difference, ifany, between the carrying value of the net assets acquired and the consideration paid by the Group is accountedfor as an adjustment to Equity.

Segment Reporting—Segments are reported in a manner consistent with how the coffee and tea business isoperated and reviewed by the chief operating decision maker. The chief operating decision maker is responsiblefor allocating resources and assessing performance of the operating segments. In conjunction with the Separation,the chief operating decision maker of the Group is the Chief Executive Officer. In December 2011, the Groupbegan operating under a new segment structure based on three operating segments: Retail—Western Europe,Retail—Rest of World and Out of Home. The Chief Executive Officer of the Group began managing the Groupbased on the new operating segments at that time. These financial statements present segment information inaccordance with this structure.

Foreign Currency Translation

Functional currency—The individual financial statements of the entities included in the financial statementsare measured in the currency of the primary economic environment in which the entity operates (its functionalcurrency).

Presentation currency—For the purpose of these financial statements, the results and financial position ofthe Group are measured in Euro, the Group’s presentation currency.

Foreign currency transactions and balances—Foreign currency transactions are translated into thefunctional currency using the exchange rates prevailing at the date of the transactions. Monetary assets andliabilities in foreign currencies are translated to the functional currency using period-end exchange rates.

Foreign currency exchange gains and losses resulting from the settlement of foreign currency transactionsand balances, and from the translation at period-end exchange rates of monetary assets and liabilitiesdenominated in foreign currencies, are recognised in the income statements.

Foreign exchange gains and losses are presented in the income statements within finance costs, except forthe foreign currency gains and losses on commodities that are included in cost of sales.

Foreign operations—The results and financial position of all entities included in the financial statementsthat have a functional currency different from the presentation currency (Euro) are translated into thepresentation currency as follows:

• Income and expenses are translated at average monthly exchange rates; and

• Statements of financial position are translated at the closing exchange rate at the reporting date.

The resulting exchange differences are recognised as foreign currency translation in other comprehensiveincome. When an operation with a functional currency other than the Euro is sold, such exchange differences arerecognised in the income statements as part of the gain or loss on the sale.

Goodwill and fair value adjustments arising from the acquisition of a foreign entity are treated as assets andliabilities of the foreign entity and are translated at the closing date exchange rate.

Subsidiary—If the ownership interest in a subsidiary is reduced but control is retained, only a proportionateshare of the amounts previously recognised in other comprehensive income is reclassified to profit or loss whereappropriate.

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Associate—If the ownership interest in an associate is reduced but significant influence is retained, only aproportionate share of the amounts previously recognised in other comprehensive income is reclassified to profitor loss where appropriate.

Property, Plant and Equipment—Property, plant and equipment is carried at historical cost, lessaccumulated depreciation and any impairment loss. The cost of purchased property, plant and equipment is thevalue of the consideration given to acquire the assets and the value of other directly attributable costs including,for qualifying assets, capitalised borrowing costs and asset retirement obligations. Leasehold improvements andother property additions and improvements are included in the asset’s carrying amount or recognised as aseparate asset, as appropriate, only when it is probable that future economic benefits associated with the item willflow to the Group and the cost of the item can be measured reliably. The carrying amount of any replaced part isderecognised at the time it is disposed and charged to expense. All repairs and maintenance costs are charged toexpense as incurred.

Property, plant and equipment is depreciated on a straight-line basis over the estimated useful lives of theassets, except land and construction in process assets which are not depreciated. The Group believes that the wearand tear on each category of assets is spread evenly over the useful life. The estimated useful lives, which arereviewed annually and adjusted if appropriate, used by the Group in all reporting periods presented are asfollows:

Buildings and improvements up to 40 yearsLeasehold improvements shorter of economic useful life or remaining lease termMachinery and equipment 3 to 25 years

The assets’ residual values are reviewed annually and adjusted, if appropriate, at the end of each reportingperiod. Gains and losses on disposals are determined by comparing the proceeds with the carrying amount of theassets and are recognised in the income statements within selling, general and administrative expenses. Anasset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount isgreater than its estimated recoverable amount.

Goodwill and Other Intangible Assets

Goodwill—Goodwill represents the excess of the cost of an acquisition over the fair value of the Group’sshare of the net identifiable assets of the acquired subsidiary at the date of acquisition. Goodwill on acquisitionsof subsidiaries is included in goodwill and other intangible assets on the statements of financial position.

Goodwill is not amortised but is tested annually for impairment, or more frequently when events areidentified which require an impairment test, and carried at cost less accumulated impairment losses. The Grouptests goodwill on the first day of the fourth quarter of its fiscal year and whenever a significant event occurs orcircumstances change that might reduce the recoverable amount of the goodwill. Impairment losses on goodwillare not reversed. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating tothe entity sold.

Goodwill is allocated to each of the cash-generating units (“CGU’s”) or groups of CGU’s for the purpose ofimpairment testing. The allocation is made to those CGU’s or groups of CGU’s that are expected to benefit fromthe business combination in which the goodwill arose, identified consistent with the operating segment beforeany aggregation.

Trademarks and other identifiable intangible assets—The primary identifiable intangible assets of theGroup are trademarks and customer relationships acquired in business combinations. Trademarks and customerrelationships are recognised at fair value at acquisition date. Trademarks and customer relationships that have afinite useful life are carried at cost less accumulated amortisation. Amortisation is calculated using the straight-line method to allocate the cost of trademarks and customer relationships over their estimated useful lives of 10

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to 30 years and 7 to 10 years, respectively. The trademarks with an indefinite life are not amortised, but insteadare tested for impairment on an annual basis and whenever a significant event occurs or circumstances changethat might reduce the fair value of these assets.

Internally generated intangible assets—An internally generated intangible asset arising from the Group’sproduct or software development is recognised only if all of the following conditions are met:

• An asset is created that can be identified (such as software and new processes);

• It is probable that the asset will generate future economic benefits; and

• The development costs can be reliably measured.

Internally generated intangible assets are amortised on a straight-line basis over their useful lives, generally4 years. Other development expenditures that do not meet these criteria, along with all expenditures on researchactivities, are recognised as an expense as incurred. Development costs previously recognised as an expense arenot recognised as an asset in a subsequent period.

Impairment of Non-Financial Assets—Assets that are subject to amortisation are reviewed for impairmentwhenever events or circumstances indicate that the carrying amount may not be recoverable. Assets that have anindefinite useful life are not subject to amortisation and are tested at least annually for impairment on the firstday of the fourth quarter of the Group’s fiscal year. An impairment loss is recognised for the amount by whichthe asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’sfair value less costs to sell or value in use. For purposes of assessing impairment, assets are grouped at the lowestlevels for which there are separately identifiable cash flows. Non-financial assets, other than goodwill that wereimpaired are reviewed for possible reversal of the impairment at each reporting date. Where an impairment losssubsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverableamount, limited to the carrying amount that would have been determined had no impairment loss beenrecognised for the asset in prior fiscal years.

Financial Assets—The Group classifies its financial assets into the following categories: fair value throughprofit or loss, and loans and receivables. The classification depends on the purpose for which the financial assetswere acquired. Management determines the classification of its financial assets at their initial recognition. TheGroup’s financial assets are classified as follows:

• Financial assets at fair value through profit or loss—A financial asset is classified in this category if itis acquired principally for the purpose of selling in the short term. Derivatives included in this categoryare also categorised as held for trading unless they are designated as hedges. Assets in this category areclassified as current assets if expected to be settled within 12 months; otherwise, they are classified asnoncurrent.

• Loans and receivables—Loans and receivables are non-derivative financial assets with fixed ordeterminable payments that are not quoted in an active market. They are included in current assets iftheir maturities are within 12 months after the end of the reporting period; otherwise they are classifiedas noncurrent assets. The Group’s loans and receivables are recorded as trade and other receivables andreceivables from Sara Lee in the statements of financial position.

The regular purchases and sales of financial assets are recognised on the trade-date, which is the date onwhich the Group commits to purchase or sell the asset. Financial assets carried at fair value through profit or lossare initially recognised at fair value, and any related transaction costs are recorded as expense in the incomestatements. Financial assets at fair value through profit or loss are also subsequently carried at fair value. Loansand receivables are initially recognised at fair value plus transaction costs and then are subsequently amortisedusing the effective interest method. Financial assets are derecognised when the rights to receive cash flows fromthe investments have expired or have been transferred and the Group has transferred substantially all risks andrewards of ownership.

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Gains or losses arising from changes in the fair value of the financial assets included in the fair valuethrough profit or loss category are recorded in the income statements in finance costs except for the change infair value of commodity derivative financial instruments that are included in cost of sales.

Financial assets and liabilities are offset and the net amount is reported in the statements of financialposition when there is a legally enforceable right to offset the recognised amounts and there is an intention tosettle on a net basis or realise the asset and settle the liability simultaneously.

Impairment of Financial Assets—The Group assesses at the end of each reporting period whether there isobjective evidence that a financial asset or group of financial assets is impaired. A financial asset or a group offinancial assets is impaired and impairment losses are incurred only if there is objective evidence of impairmentas a result of one or more events that occurred after the initial recognition of the asset (“loss event”) and that theloss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financialassets that can be reliably estimated. The criteria that the Group uses to determine if there is objective evidenceof an impairment loss include:

• Significant financial difficulty of the issuer or obligor;

• A breach of contract, such as a default or delinquency in interest or principal payments;

• The Group, for economic or legal reasons relating to the borrower’s financial difficulty, granting to theborrower a concession that the lender would not otherwise consider;

• It becomes probable that the borrower will enter bankruptcy or other financial reorganisation;

• The disappearance of an active market for that financial asset because of financial difficulties; or

• Observable data indicating that there is a measurable decrease in the estimated future cash flows from aportfolio of financial assets since the initial recognition of those assets, although the decrease cannotyet be identified within the individual financial assets in the portfolio, including:

• Adverse changes in the payment status of borrowers in the portfolio; and

• National or local economic conditions that correlate with defaults on the assets in the portfolio.

For loans and receivables, the amount of the loss is measured as the difference between the asset’s carryingamount and the present value of estimated future cash flows (excluding future credit losses that have not beenincurred) discounted at the financial asset’s original effective interest rate. The carrying amount of the asset isreduced and the amount of the loss is recognised in the income statements within selling, general andadministrative expenses. If, in a subsequent period, the amount of the impairment loss decreases and the decreasecan be related objectively to an event occurring after the impairment was recognised (such as an improvement inthe debtor’s credit rating), the reversal of the previously recognised impairment loss is recognised in the incomestatements within selling, general and administrative expenses.

Derivative Financial Instruments and Hedging Activities—Derivatives are initially recognised at fairvalue on the date a derivative contract is entered into and are subsequently remeasured at fair value. The methodof recognising the resulting gain or loss from the measurement depends on whether the derivative is designatedas a hedging instrument and, if so, the nature of the item being hedged. The Group designates certain derivativesas hedges of the fair value of recognised assets or liabilities or a firm commitment (“fair value hedge”). As offiscal years 2012, 2011 and 2010, the Group did not apply hedge accounting except for its interest rate swapsdescribed below.

The Group documents at the inception of the transaction the relationship between hedging instruments andhedged items, as well as its risk management objectives and strategy for undertaking various hedgingtransactions. The Group also documents its assessment, both at hedge inception and on an ongoing basis, ofwhether the derivatives that are used in hedging transactions are highly effective in offsetting changes in fairvalue of the hedged items.

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The fair values of the Group’s derivative instruments are disclosed in Note 11. The Group classifiesderivatives that have a settlement date within one year from the period end as current and all other derivatives asnoncurrent in the statements of financial position. The Group records the change in fair value of commodityderivatives within cost of sales and the movement of all other derivatives within finance costs in the incomestatements.

Fair value hedge—The changes in the fair value of derivatives that are designated and qualify as fair valuehedges are recorded in the income statements, together with any changes in the fair value of the hedged asset orliability that are attributable to the hedged risk. The Group only applies fair value hedge accounting for hedgingfixed interest rate risk on its Eurobonds. The gain or loss relating to both the effective and ineffective portion ofinterest rate swaps hedging the fixed-rate borrowings is recognised in the income statements within finance costs.Changes in the fair value of the hedged fixed-rate borrowings attributable to interest rate risk are also recognisedin the income statements within finance costs.

If the hedge no longer meets the criteria for hedge accounting, the adjustment to the carrying amount of ahedged item for which the effective interest method is used is amortised to income over the period to maturity.

Inventories—Inventories are stated at the lower of cost or net realisable value. Cost is determined by thefirst-in, first-out (“FIFO”) method and includes the impact of rebates, discounts and other cash considerationreceived from a vendor related to inventory purchases. The cost of finished goods and work in progresscomprises design costs, raw materials, direct labour, and other direct costs, including transportation costsincurred in bringing inventories to their location immediately prior to external sale, and condition and relatedproduction overheads based on normal operating capacity. Net realisable value is the estimated selling price inthe ordinary course of business, less applicable variable selling expenses. In addition, as discussed in the leasingpolicy, inventories include Out of Home machines that have not yet been leased.

Trade and Other Receivables—Trade receivables are amounts due from customers for merchandise soldor services performed in the ordinary course of business. If collection is expected in 12 months or less, they areclassified as current. If not, then they are presented as noncurrent assets. Trade receivables are recognisedinitially at their fair value and subsequently measured at amortised cost using the effective interest method, less aprovision for impairment.

Cash and Cash Equivalents—In the statements of financial position, cash and cash equivalents includecash on hand and other short-term highly liquid investments with original maturities of three months or less. Anybank overdrafts are included in trade and other payables. In the statements of cash flows, any bank overdrafts areincluded as an offset to cash and cash equivalents.

Borrowings—Borrowings are recognised initially at fair value, net of transaction costs incurred.Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net oftransaction costs) and the redemption value is recognised in the income statements over the period of theborrowings using the effective interest method.

Any fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to theextent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred untilthe draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will bedrawn down, the fee is capitalised as a pre-payment for liquidity services and amortised over the period of thefacility to which it relates.

Retirement Benefit Obligations—The Group contributes to defined contribution retirement benefit plansthat are recognised as expense when employees have rendered service entitling them to the contributions.

For defined benefit plans, the cost of providing benefits is determined using the Projected Unit CreditMethod, with actuarial valuations being carried out at the end of each fiscal year. Actuarial gains and lossesarising from experience adjustments and changes in actuarial assumptions are charged or credited to other

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comprehensive income in the period in which they arise. Past service cost is recognised immediately to the extentthat the benefits are already vested, and otherwise is amortised on a straight-line basis over the average perioduntil the benefits vest. For defined benefit plans, the operating and finance costs are recognised separately in theincome statements. The amount recognised as operating cost in the income statements is the cost of accruingpension benefits promised to employees over the year, plus the costs of individual events such as past servicebenefit enhancements, settlements and curtailments (such events are recognised immediately in the incomestatements). The amount recognised as finance income includes a credit equivalent to the Group’s expectedreturn on the pension plans’ assets over the year, offset by a charge equal to the expected increase in the plans’liabilities over the year as a result of the time value of money.

The retirement benefit obligations recognised in the statement of financial position represent the presentvalue of the defined benefit obligation, as adjusted for unrecognised past service cost, and as reduced by the fairvalue of plan assets. Any asset resulting from this calculation is limited to unrecognised past service cost, plusthe present value of available refunds and reductions in future contributions to the plan.

Termination Benefits—Termination benefits are payable when employment is terminated by the Groupbefore the normal retirement date or whenever an employee accepts voluntary redundancy in exchange for thesebenefits. The Group recognises termination benefits when it is demonstrably committed to a termination andwhen the entity has a detailed formal plan to terminate the employment of current employees without possibilityof withdrawal. In the case of an offer made to encourage voluntary redundancy, the termination benefits aremeasured based on the number of employees expected to accept the offer. Benefits falling due more than 12months after the end of the reporting period are discounted to their present value. The estimated costs associatedwith these benefits are reflected in the restructuring provisions discussed in Note 23.

Share-Based Payment— The Company established a long-term incentive plan (“2012 Long-TermIncentive Share Plan”) in fiscal year 2012, under which the Company can award performance share units(“PSUs”) to the chief executive officer, the members of the executive committee, highly compensated executivesand, potentially, other key employees designated by the remuneration committee. As these PSUs are to be settledin the Company’s shares, the Company accounts for the awards as equity-settled share-based paymenttransactions. Equity-settled share-based payment is measured at fair value (including the effect of market-basedvesting conditions) at the grant date. The fair value determined at the grant date of the equity-settled share-basedpayment is expensed on a straight-line basis over the vesting period, based on the Group’s estimate of thenumber of shares that will eventually vest. The Group recognises compensation expense on a straight-line basisfrom the beginning of the service period, even when the grant date is subsequent to the service commencementdate. During the period between service commencement date and grant date, the compensation expenserecognised is based on an estimated grant date fair value of the award.

Prior to implementing the 2012 Long-Term Incentive Share Plan, certain employees of the Groupparticipated in Sara Lee share-based payment plans. Awards under the plans included PSUs, stock options andrestricted stock units (“RSUs”). The awards were granted by Sara Lee and for all plans settlement is theresponsibility of Hillshire Brands, except for certain awards as disclosed below in Note 18. To the extent theGroup has no responsibility to settle any element of the awards granted by Sara Lee, they are accounted for asequity-settled awards.

The share-based payment plans reflected in the income statements for fiscal years 2011 and 2010 relate toPSUs, stock options and RSUs granted by Sara Lee to the Group’s employees. The expense for share-basedpayment has been recognised based on grant-date fair value of those awards. All equity instruments granted bySara Lee do not vest until certain conditions are met, as described in the relevant plan rules. Any differencebetween the amount of share-based compensation expense recorded and any reimbursement to Sara Lee wasrecorded as a component of the Parent’s net investment.

Provisions—Provisions, which are primarily for restructuring costs, legal claims, medical claims andenvironmental obligations are recognised when the Group has a present legal or constructive obligation as a

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result of past events; it is probable that an outflow of resources will be required to settle the obligation; and theamount can be reliably estimated. Restructuring provisions primarily comprise employee termination payments.Provisions are not recognised for future operating losses.

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlementis determined by considering the class of obligations as a whole. A provision is recognised even if the likelihoodof an outflow with respect to any one item included in the same class of obligations may be small.

Provisions are measured at the present value of the expenditures expected to be required to settle theobligation using a pre-tax discount rate that reflects current market assessments of the time value of money andthe risks specific to the obligation. The increase in the provision due to passage of time is recognised as interestexpense.

Trade and Other Payables—Trade payables are obligations to pay for goods or services that have beenacquired in the ordinary course of business. Trade and other payables are classified as current liabilities ifpayment is due within one year or less. If not, they are presented as noncurrent liabilities. Trade and otherpayables are recognised initially at fair value and subsequently measured at amortised cost using the effectiveinterest method.

Income Taxes—The Group operates in multiple tax jurisdictions around the world, and as such, the Grouppays taxes as required by local country tax law. In jurisdictions which permit fiscal unity, the Group’s operationswere typically included with other Sara Lee operations in a consolidated group tax filing for periods prior to theSeparation.

For the purposes of these financial statements, income taxes are presented on a separate company basis as ifthe Group operated as a stand-alone entity or a separate consolidated group in each material jurisdiction in whichit operates for all the pre-Separation periods. Tax balances reported in post-Separation periods reflect the currentand deferred tax position of D.E MASTER BLENDERS. As described in Note 1, the Separation resulted incertain adjustments to previously recorded tax amounts, and these adjustments have been recorded throughparent’s net investment.

Current income taxes were assumed to be settled with Sara Lee for all pre-Separation periods, generally inthe period after the related income taxes are recorded, through equity. The assumed settlement of current incometaxes with Sara Lee, as well as other tax related payments, have been recorded through transfers (to)/from Parentin the statements of cash flows for these periods. The effects of being included in Sara Lee’s consolidated taxreturns, including the utilisation of any historical net operating losses, have been included in parent’s netinvestment.

The tax expense for the fiscal year is comprised of current and deferred income tax. Tax expense isrecognised in the income statements, except to the extent that it relates to items recognised in othercomprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensiveincome or directly in equity.

Current income tax—The current income tax expense is calculated on the basis of the tax laws enacted orsubstantively enacted at the reporting date in the countries where the Group operates and generates taxableincome.

The Group recognises liabilities for uncertain tax positions when it is more likely than not that an outflowwill occur to settle the position. The liabilities are measured based upon management’s estimation of theexpected settlement of the matter. These liabilities are presented within income taxes payable on the statementsof financial position. These amounts, along with estimates of interest and penalties on tax liabilities are alsorecorded in income taxes payable, and are included in current tax expense.

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Deferred income tax—Deferred income tax is recognised, using the liability method, on temporarydifferences arising between the tax basis of assets and liabilities and their carrying amounts in the financialstatements. However, deferred income tax liabilities are not recognised if they arise from the initial recognitionof goodwill. Deferred income tax is not accounted for if it arises from initial recognition of an asset or liability ina transaction, other than a business combination, that at the time of the transaction affects neither accounting nortaxable profit or loss. Deferred income tax is determined using tax rates that have been enacted or substantivelyenacted at the reporting date and are expected to apply when the related deferred income tax asset is realised orthe deferred income tax liability is settled.

Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit willbe available against which the temporary differences or tax losses can be utilised.

Deferred income tax is provided on temporary differences arising from investments in subsidiaries andassociates, except for deferred income tax liability where the timing of the reversal of the temporary difference iscontrolled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future.

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset currenttax assets against current tax liabilities and when the deferred income tax assets and liabilities relate to incometaxes levied by the same taxation authority on either the same taxable entity or different taxable entities wherethere is an intention to settle the balances on a net basis.

Government Grants—Grants from the government are recognised at their fair value where there isreasonable assurance that the grant will be received and the Group will comply with all required conditions.Government grants to cover costs are deferred and recognised in the income statements over the period necessaryto match them with the costs that they are intended to compensate. Government grants relating to property, plantand equipment are recorded as an offset against property, plant and equipment.

Revenue Recognition—Sales comprises the fair value of the consideration received or receivable for thesale of goods and services in the ordinary course of the Group’s activities. The Group recognises sales when theamount of revenue can be reliably measured, it is probable that future economic benefits will flow to the Groupand when specific criteria have been met for each of the Group’s activities as described below. The Group basesits estimates on historical results, taking into consideration the type of customer, the type of transaction and thespecifics of each arrangement.

Contracts with Out of Home customers—The Group’s contracts with Out of Home customers may includemultiple elements including the delivery of products and the lease or sale of coffee equipment. In some instances,the coffee equipment is provided for free, but the customer agrees to purchase and use the Group’s products.Such contracts may be inclusive of free maintenance of the coffee equipment for a specific period. In suchsituations, the Group separates the sales transaction into the identifiable components in order to reflect thesubstance of the transaction whenever such identifiable components have stand-alone value and the fair value canbe measured reliably. The Group assesses the fair values available for individual components and accounts foreach component as a separate transaction in accordance with IAS 18 Revenue. The total consideration payable bythe customer is allocated to the individual components by reference to their fair values.

Customer loyalty programmes—The Group has a customer loyalty programme in the Netherlands wherebyconsumers collect points (“award credits”) towards merchandise. The customer loyalty programme is considereda multiple-element arrangement whereby the consumer is purchasing the products as well as the award credit.The revenue associated with the award credit, which is estimated based on the fair value of the award credits, isdeferred and recognised separately as a liability at the time of the initial sale. The estimation of the fair value ofthe award credits includes consideration of the proportion of the awards expected to be redeemed. The deferredrevenue, which is included in other noncurrent liabilities (to the extent that redemption after 12 months isexpected) and trade and other payables (current portion) in the statements of financial position, is recognisedwhen fulfilled.

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The Group’s sales consist of the following:

• Product sales and sale of green coffee beans to third parties—The conditions above are generally metwhen title and risk of loss of the products pass to distributors, resellers or end customers. In particular,title usually transfers upon receipt of the product at the customers’ locations, or upon shipment, asdetermined by the specific sales terms of the transactions.

• Lease revenue and maintenance fees—The Group leases coffee machines to certain of its Out of Homecustomers. The Group recognises income from these leases in the income statements based on thepolicy for leases described below. In addition, the Group receives maintenance fees related to its Out ofHome machines, which are recognised on an accrual basis in accordance with the substance of therelevant agreements. Revenue from fixed-price contracts is generally recognised in the period that themaintenance services are rendered, using a straight-line basis over the term of the contract.

Revenues described above are recognised at the fair value of the consideration received or receivable afterdeducting estimated amounts for sales incentives, trade allowances and product returns. The Group estimatestrade allowances and product returns based on historical results taking into consideration the customer,transaction and specifics of each arrangement. The Group provides a variety of sales incentives to resellers andconsumers of its products, and the policies regarding the recognition and presentation of these incentives withinthe income statements are as follows:

Included in Sales:

• Discounts, coupons and rebates—The cost of these non-volume-based incentives is recognised at thelater of the date at which the related sale is recognised or the date at which the incentive is offered. Thecost of these incentives is estimated using a number of factors, including historical utilisation andredemption rates. These incentives are settled in cash and are included in the determination of sales.

• Listing fees—Certain retailers require the payment of listing fees in order to provide space for theGroup’s products on the retailer’s store shelves. The cost of these fees is recognised at the earlier of thedate cash is paid or a liability to the retailer is created. These amounts are included in the determinationof sales.

• Volume-based incentives—These incentives typically involve rebates or refunds of a specified amountof cash if the reseller reaches a specified level of sales. Under incentive programmes of this nature, theGroup estimates the incentive and allocates a portion of the incentive to reduce each underlying salestransaction with the customer.

• Cooperative advertising—Under these arrangements, the Group agrees to reimburse the reseller for aportion of the costs incurred by the reseller to advertise and promote certain of the Group’s products.The Group recognises the cost of cooperative advertising programmes in the period in which theadvertising and promotional activity first takes place. These costs are recorded as an offset to sales.

• Fixtures and racks—Store fixtures and racks are given to retailers to display certain of the Group’sproducts. The costs of these fixtures and racks are recorded as a reduction in sales in the period inwhich they are delivered to the retailer.

Included in Cost of Sales:

• Discounts, coupons and rebates—These non-volume-based incentives are offered in the form of freeproduct and are included in the determination of cost of sales. The cost of these incentives isrecognised at the later of the date at which the related sale is recognised or the date at which theincentive is offered. The cost of these incentives is estimated using a number of factors, includinghistorical utilisation and redemption rates.

Finance Income—The Group receives finance income primarily representing interest on cash and cashequivalents and loans to Sara Lee. The interest is recognised using the effective interest method.

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Leases—Leases are classified as finance leases whenever the terms of the lease transfer substantially all therisks and rewards of ownership to the lessee. All other leases are classified as operating leases.

Group as lessor

• Finance leases—The Group recognises assets it expects to lease to customers under finance leases asinventory on its statements of financial position. The Group derecognises the inventory when a financelease is entered into and records a receivable at an amount equal to the net investment in the lease. TheGroup subsequently recognises finance income based on a pattern reflecting a constant periodic rate ofreturn on that net investment.

• Operating leases—Lease income from assets on operating lease to customers is recognised in theincome statements on a straight-line basis over the lease term. Initial direct costs and installation costsincurred by the Group in negotiating the leases are added to the carrying amount of the leased asset,which is included in property, plant and equipment, and recognised as depreciation expense over thelease term on the same basis as the lease income. The depreciation policy for depreciable leased assetsis consistent with the Group’s normal depreciation policy for similar assets.

Group as lessee

• Finance leases—Assets held under finance leases are initially recognised as assets of the Group at theirfair value at the inception of the lease or, if lower, at the present value of the minimum lease payments.The corresponding liability to the lessor is included in the statements of financial position withinborrowings.

• Operating leases—Payments made under operating leases are charged to expense on a straight-linebasis over the period of the lease. When an operating lease is terminated before the lease period hasexpired, any penalty payment required to be made to the lessor is recognised as an expense in theperiod in which the termination takes place.

Borrowing Costs—Borrowing costs directly attributable to the acquisition, construction or production ofqualifying assets, which are assets that take a substantial period of time to get ready for their intended use or sale,are added to the cost of those assets, until such time as the assets are substantially ready for their intended use orare sold. All other borrowing costs are recognised as expense in the period in which they are incurred.

Advertising Expense—Advertising costs, which include the development and production of advertisingmaterials and the communication of this material through various forms of media, are expensed in the period inwhich title to the advertising campaign is received. Advertising expense is recognised in selling, general andadministrative expenses in the income statements.

New Standards, Amendments and Interpretations Adopted during the fiscal year ended 30 June 2012

The Group has applied the following accounting standards, amendments and interpretations during fiscalyear 2012. There were no significant changes to the Group’s financial statements upon adoption of theseaccounting standards, amendments and interpretations.

IAS 24, Related Party Disclosures—The revisions simplify the disclosure requirements for government-related entities and clarify the definition of a related party.

IFRS Interpretations Committee (“IFRIC”) 13, Customer Loyalty Programmes, updated what is consideredwhen measuring the fair value of an award.

IAS 1, Presentation of Financial Statements, was amended in June 2011 for annual reporting periodsbeginning on or after 1 July 2012. The amendments preserve the presentation of other comprehensive income asa single continuous statement or as separate statements of profit or loss and a statement of comprehensive

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income. The amendment also requires entities to group items of other comprehensive income and the related taxeffects based on whether they are potentially reclassifiable to profit and loss or not. The Group applies therevised standard from June 2011. It has no impact on the consolidated financial statements.

New Standards, Amendments and Interpretations Issued, but not Effective for the Fiscal Year Ended30 June 2012 and not Early Adopted

The following are descriptions of new standards, amendments and interpretations of IFRS that have beenissued but are not yet effective for the Group. The Group is in the process of assessing whether there will be anysignificant changes to its financial statements upon adoption of these standards.

IFRS 10, Consolidated Financial Statements (“IFRS 10”), issued in May 2011, supersedes IAS 27 (Revised2008), Consolidated and Separate Financial Statements and Standing Interpretations Committee (“SIC”) 12,Consolidation—Entities. The standard defines the principle of control, establishes control as the basis fordetermining which entities are consolidated in the financial statements and identifies the following three elementsof control:

• Power over the investee;

• Exposure, or rights, to variable returns from involvement with the investee; and

• The ability to use power over the investee to affect the amount of the investor’s returns.

This standard is effective for annual periods beginning on or after 1 January 2013.

The Group is in the process of assessing the potential impact of IFRS 10 and intends to adopt IFRS 10 on1 January 2014.

IAS 27 (Revised 2011), Separate Financial Statements, issued in May 2011, supersedes IAS 27,Consolidated and Separate Financial Statements in conjunction with IFRS 10. The standard prescribes theaccounting and disclosure requirements for investments in subsidiaries, joint ventures and associates whenseparate financial statements are prepared. This standard is effective for annual periods beginning on or after1 January 2013.

The Group is in the process of assessing the potential impact of IAS 27 and whether to adopt this standard.

IFRS 11, Joint Arrangements (“IFRS 11”), issued in May 2011, supersedes IAS 31, Interests in JointVentures and SIC-13, Jointly Controlled Entities—Non-Monetary Contributions by Venturers. The standardestablishes principles for financial reporting by entities that have interests in joint arrangements. A jointarrangement is defined as an arrangement where two or more parties have joint control and, based on the rightsand obligations of the parties to the arrangement, is classified as either of the following:

• Joint operation—parties have rights to the assets and obligations for the liabilities of the arrangement;and

• Joint venture—parties have rights to net assets of the arrangement.

This standard is effective for annual periods beginning on or after 1 January 2013.

The Group is in the process of assessing the potential impact of IFRS 11 and intends to adopt IFRS 11 on1 January 2014.

IAS 28 (Revised 2011), Investments in Associates and Joint Ventures, issued May 2011, supersedes IAS 28,Investments in Associates (as revised in 2003 and amended in 2010). The standard prescribes the accounting forinvestments in associates and establishes the requirements for applying the equity method when accounting forinvestments in associates and joint ventures.

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This standard is effective for annual periods beginning on or after 1 January 2013.

The Group is in the process of assessing the potential impact of IAS 28 and intends to adopt IAS 28 on1 January 2014.

IFRS 12, Disclosure of Interests in Other Entities, (“IFRS 12”) issued in May 2011 establishes disclosureobjectives according to which entities disclose information about the significant judgements and assumptionsused in determining:

• Whether it has control, joint control or significant influence; and

• The type of joint arrangement.

This standard is effective for annual periods beginning on or after 1 January 2013.

The Group is in the process of assessing the potential impact of IFRS 12 and intends to adopt IFRS 12 on1 January 2014.

IFRS 13, Fair Value Measurement, issued in May 2011, establishes common requirements for measuringfair value and for disclosing information about fair value measurements. The standard defines fair value, sets outa single IFRS for measuring fair value and provides required fair value disclosures. This standard is effective forannual periods beginning on or after 1 January 2013, with earlier adoption permitted.

The Group is in the process of assessing the potential impact of IFRS 13 and intends to adopt IFRS 13 on1 January 2014.

IAS 19, Employee Benefits, was amended in June 2011 for annual reporting periods beginning on or after1 January 2013, with early adoption permitted. The amendments require the calculation of finance costs on a netfunding basis and replacement of the expected return on plan assets by discount rate.

The Group has performed an initial calculation of the impact of adopting the amendment to IAS 19. TheGroup estimates that if the amendment had been applied during fiscal 2012, the impact would have reducedfinance income by approximately €37 million. The Group intends to adopt IAS 19 on 1 January 2014.

IAS 32, Financial Instruments: Presentation, was amended in December 2011 for annual periods beginningon or after 1 January 2014. The amendments clarified the meaning of ‘legally enforceable right of set-off’, theapplication of simultaneous realisation and settlement and the unit of account for applying the offsettingrequirements. The Group does not expect the adoption to have a material impact on its consolidated financialstatements.

The future accounting standards for IFRS 10, IFRS 11, IFRS 12, IFRS 13, as amended, are not yet endorsedby the European Union.

3. FINANCIAL RISKS

Financial Risk Factors

The Group’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk,commodity price risk and interest rate risk), credit risk and liquidity risk. All of these risks arise in the normalcourse of business. The Group’s overall risk management programme focuses on the unpredictability of financialmarkets and seeks to minimise potential adverse effects on the Group’s financial performance. To mitigate therisk from interest rate, foreign currency exchange rate and commodity price fluctuations, the Group uses variousderivative financial instruments that have been authorised pursuant to the Group’s policies and procedures. The

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Group’s derivatives are accounted for at fair value through profit and loss during the periods presented except theinterest rate derivatives associated with certain borrowings that were repaid during fiscal 2012. The Group doesnot use financial instruments for trading purposes and is not a party to any leveraged derivatives.

Market risk

• Commodity price risk—Commodity price risk arises primarily from transactions on the worldcommodity markets for securing the supply of green coffee beans. The Group’s objective is tominimise the impact of commodity price fluctuations. This exposure is hedged based on the Group’spolicies. The commodity risk is managed at two regional locations in Switzerland and Brazil. Thecommodity price risk exposure of anticipated future purchases is managed primarily using derivativefutures and options. As a result of the short product business cycle of the Group, the majority of theanticipated future raw material transactions outstanding at the reporting date are expected to occur inthe next year.

The Group generally enters into futures and options contracts that are traded on established, well-recognised exchanges that offer high liquidity, transparent pricing, daily cash settlement andcollateralisation through margin requirements.

• Foreign exchange risk—The Group operates internationally and is exposed to foreign exchange riskarising from various currency exposures, primarily with respect to the U.S. dollar, Brazilian real,British pound, Danish kroner, Hungarian forint and Australian dollar against the Euro. Foreignexchange risk arises primarily from commercial transactions such as the purchase of commodities,recognised monetary assets and liabilities, net investments in foreign operations and from borrowingsin currencies other than the functional currency of the entity that entered into the borrowings.

The Group uses forward exchange and option contracts and cross currency swaps to reduce the effectof fluctuating foreign currencies on short-term foreign-currency-denominated intergroup transactions,third-party product-sourcing transactions, foreign-denominated investments (including subsidiary netassets), foreign currency denominated debt and other known foreign currency exposures. Gains andlosses on the derivative instruments are intended to offset gains and losses on the associated transactionin an effort to reduce the earnings volatility resulting from fluctuating foreign currency exchange rates.Forward currency exchange contracts mature at the anticipated cash requirement date of the associatedtransaction, generally within 12 to 18 months. The Group did not designate any of its foreign exchangederivatives as hedges for accounting purposes during the periods presented and as a result, the changein fair value is recognised directly to the income statement. Subsequent to fiscal year 2012 end theGroup entered into cross currency swaps to manage the risk associated with its US dollar borrowings.

Using the exchange rates as of the reporting dates, the Euro equivalent of commitments to purchase andsell foreign currencies is €1.7 billion and €1.7 billion, respectively, as of fiscal year 2012, €1.2 billionand €1.2 billion, respectively, as of fiscal year 2011 and €1.1 billion and €1.0 billion, respectively as offiscal year 2010. The Group enters into derivative financial instruments to manage the exposure forvirtually all foreign exchange risk derived from recorded transactions and firm commitments andanticipated transactions where the exposure is potentially significant.

• Interest rate risk—Interest rate risk comprises the interest price risk that results from borrowings atfixed rates and the interest cash flow risk that results from borrowings at variable rates.

Prior to the Separation, the Group managed its interest rate price risk associated with third partyborrowings by entering into interest rate swaps to effectively convert its fixed-rate debt instrumentsinto floating-rate debt instruments. Interest rate swap agreements that were effective at hedging the fairvalue of the fixed-rate debt agreements were designated and accounted for as fair value hedges.

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Upon Separation, the Group established its own policy to manage interest rate risk based on theGroup’s current leverage ratio and the current market interest rates. The Group regularly assesses thecurrent market environment and the Group’s leverage ratio in determining the need for interest rateswaps or hedging instruments to manage its risk. At end of fiscal 2012 the Group has primarily fixedrate debt and based on these criteria made a decision not to enter into any interest rate swaps associatedwith these borrowings. Subsequent to the end of fiscal 2012, the Group entered into fixed-to-fixed ratecross currency swaps to effectively convert its fixed rate USD debt in to fixed rate EUR debt.

• Risk management—The Group maintains risk management control systems to monitor the foreignexchange, interest rate and commodity price risk and the Group’s offsetting hedge positions. TheGroup utilises a sensitivity analysis technique to evaluate the effect of any changes in interest rate,commodity prices and foreign currencies and the associated risk derivatives.

• Commodities—As of fiscal years 2012, 2011 and 2010, if commodity prices changed by 10% thethe Group’s profit would have been impacted by €7.5 million, €4.3 million and €6.1 million,respectively.

• Interest rate swaps— During the periods presented, Group had minimal exposure to interest ratemovements due to the amount of outstanding borrowings throughout those periods. The majorityof the outstanding borrowings were at fixed rates during these periods. As noted above, prior toSeparation the Group converted its fixed rate third party borrowing into variable rate debt throughthe use of derivative financial instruments. A 10% change in the fair value of the interest ratederivatives in place during fiscal years 2011 and 2010, would have changed profit by €0.4 millionand €0.7 million, respectively.

• Foreign currency—As noted above, the Group has a foreign transaction exposure. The Groupmanaged this risk through the use of derivative financial instruments. In connection with theSeparation, the Group entered into fixed rate USD denominated senior notes which, as describedabove, exposed the Group to foreign currency risk. The Group initially managed this risk throughforward contracts. The forward contracts were replaced with cross currency swaps subsequent tothe end of fiscal 2012. During fiscal years 2012, 2011 and 2010, if the foreign currency rateschanged by 10%, the impact on the Group’s profit for the period would be €47.1 million,€52.8 million and €23.6 million, respectively (primarily driven by US dollar). In addition, duringfiscal year 2011 the Group had foreign currency options, which if the fair value changed by 10%would have changed profit by €1.0 million.

Credit risk

Credit risk arises because a counterparty may fail to perform its obligations. The Group is exposed tocredit risk on financial instruments such as cash, derivative assets and trade receivables. The Groupavoids the concentration of credit risk on its liquid assets by spreading them over several financialinstitutions with a minimum credit rating threshold.

In relation to derivative financial instruments, the Group enters into financial instrument agreementsonly with counterparties meeting very stringent credit standards (a credit rating of A-/A2 or better),limiting the amount of agreements or contracts it enters into with any one party and, where legallyavailable, executing master netting agreements. These positions are continually monitored. While theGroup may be exposed to credit losses in the event of non-performance by individual counterparties ofthe entire group of counterparties, it has not recognised any losses with these counterparties in the pastand does not anticipate material losses in the future.

All of the Group’s derivative instruments are governed by International Swaps and DerivativesAssociation master agreements.

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The Group’s trade receivables are subject to credit limits, controls and approval procedures. Due to itslarge geographic base and number of customers, the Group is not exposed to material concentrations ofcredit risk on its trade receivables. Nevertheless, commercial counterparties are constantly monitored.

The maximum exposure to credit risk resulting from financial activities, without considering nettingagreements and without taking into account any collateral held or other credit enhancements, is equalto the carrying amount of the Group’s financial assets.

Liquidity risk

Liquidity risk arises when a company encounters difficulties to meet commitments associated with liabilitiesand other payment obligations. Such risk may result from inadequate market depth or disruption or refinancingproblems. The treasurer has established the liquidity risk management framework for the management of short-,medium- and long-term funding and liquidity management requirements. Liquidity risk is managed bymaintaining adequate reserves and banking facilities and by closely monitoring forecasted and actual cash flowsand, where possible, matching the maturity profiles of financial assets and liabilities. In connection with theSeparation, the Group entered into a €750 million revolving credit facility with a syndicate of banks. This facilitywill provide financing to the Group for future periods.

The following disclosure details the Group’s remaining contractual maturities for its non-derivativefinancial liabilities with agreed repayment periods. The disclosures have been prepared based on theundiscounted cash flows of financial liabilities based on the earliest date on which the Group can be required topay. The disclosures include both interest and principal cash flows. To the extent that interest flows are floatingrate, the undiscounted amount is based on the interest rate at the end of the period (all amounts in thousands ofEuro).

Less than3 months

Between3 months

and 1 year

Between1 year

and 5 yearsOver 5Years Total

As of fiscal year 2012Borrowings:

Senior notes . . . . . . . . . . . . . . . . . . . . . . . € — € 20,001 € 80,002 €591,826 € 691,829Other borrowing . . . . . . . . . . . . . . . . . . . . — 28,456 7,159 — 35,615

Trade payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 282,060 — — — 282,060

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €282,060 € 48,457 € 87,161 €591,826 €1,009,504

As of fiscal year 2011Borrowings:

Eurobonds . . . . . . . . . . . . . . . . . . . . . . . . . € — €306,750 € — € — € 306,750Other borrowing . . . . . . . . . . . . . . . . . . . . 19,770 29,943 17,551 8,903 76,167

Trade payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 264,711 — — — 264,711Payables to Sara Lee . . . . . . . . . . . . . . . . . . . . . . . . . 1,120 — — — 1,120

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €285,601 €336,693 € 17,551 € 8,903 € 648,748

As of fiscal year 2010Borrowings:

Eurobonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € — € — €313,500 € — € 313,500Other borrowing . . . . . . . . . . . . . . . . . . . . . . . . 9,020 — 25,794 — 34,814

Trade payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 198,301 — — — 198,301Payables to Sara Lee . . . . . . . . . . . . . . . . . . . . . . . . . 3,225 — — — 3,225

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €210,546 € — €339,294 € — € 549,840

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Capital Risk Management

The Group considers the following components of its balance sheet to be capital: non-current borrowings,current borrowings and equity. Prior to the Separation, Sara Lee controlled the capital risk management policy ofthe Group. The objectives of such policy was to safeguard the ability to continue as a going concern in order toprovide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structureto reduce the cost of capital. Following the Separation, the Group continues to manage its capital with the sameobjectives. The capital structure of the Group consists of debt, which includes the borrowings discussed in Note19, cash and cash equivalents, and equity directly attributable to equity holders of the Company, comprisingshare capital, additional paid in capital and other reserves. Management reviews the Group’s capital structure onan ongoing basis and would consider a long term Net Debt to EBITDA leverage ratio of up to a maximum of 2.5times as acceptable. EBITDA is defined as profit for the year before income taxes, finance income, finance costs,depreciation and amortisation.

Fair Value Estimation

For financial instruments that are carried at fair value the categories used are as follows:

• Quoted prices (unadjusted) in active markets for identical assets or liabilities (“Level 1”).

• Inputs other than quoted prices included within Level 1 that are observable for the asset or liability,either directly (that is, as prices) or indirectly (that is, derived from prices) (“Level 2”).

• Inputs for the asset or liability that are not based on observable market data (that is, unobservableinputs) (“Level 3”).

Substantially all of our derivative assets and liabilities are valued using Level 2 valuation methods.

The fair value of financial instruments that are not traded in an active market (for example, over-the-counterderivatives) is determined by using valuation techniques. These valuation techniques maximise the use ofobservable market data where it is available and rely as little as possible on entity-specific estimates. If allsignificant inputs required to fair value an instrument are observable, the instrument is included in Level 2.

There have not been any significant transfers between the different levels of financial instruments.

Management believes that the carrying amount of all other financial assets and financial liabilitiesrecognised in the statements of financial position approximates its fair value due to:

• the short-term nature of the instruments for all current financial assets and liabilities; and

• the fact management believes the rates associated with the senior notes are consistent with rates forcomparable borrowings at the reporting date.

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

In the application of the Group’s accounting policies, which are described in Note 2, management isrequired to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities thatare not readily apparent from other sources. The estimates and associated assumptions are based on historicalexperience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accountingestimates are recognised in the period in which the estimate is revised if the revision affects only that period or inthe period of the revision and future periods if the revision affects both current and future periods.

Critical Accounting Estimates and Assumptions—The following are the key assumptions concerning thefuture, and other key sources of estimation uncertainty at the end of the reporting period, that have a significantrisk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financialyear.

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Corporate allocations (Note 1)—The financial statements include allocations for certain expenseshistorically maintained by Sara Lee, but not recorded in the accounts of the Group. Such items have beenallocated to the Group and included in the financial statements based on the most relevant allocation method,primarily relative percentage of revenue or headcount. Management believes that this basis for allocation ofexpenses is reasonable.

Impairment of goodwill (Note 7)—The Group performs impairment reviews by comparing the carryingvalue of the cash-generating unit concerned to that cash generating unit’s recoverable amount, being the higherof the value in use and fair value less costs to sell. Value in use is a valuation derived from the discounted futurecash flows of the cash-generating units. The most important estimates in determining the present value of cashflows are growth rates used to calculate revenue growth and suitable discount rates in order to determine presentvalue.

Growth rates are based on past performance, external market growth assumptions, and forecast tradingconditions by the Group’s management using a combination of Group business plans and growth assumptionsinto perpetuity reflecting expected long-term growth in the market. The Group determines discounts rates for itsrespective analyses of recoverability that are appropriate for the type, size and specific countries related to eachcash-generating unit.

The Group reviews these estimates at least annually as of the date of each impairment test and believes themto be appropriate. However, changes in these estimates could change the outcomes of the impairment reviewsand therefore affect future financial results, the effects of which would be recognised in the income statements,through operating profit. See Note 7 for sensitivity to these assumptions.

The carrying amount of goodwill as of fiscal years 2012, 2011 and 2010 was €187.1 million, €182.8 millionand €163.4 million, respectively.

Impairment of non-financial assets other than goodwill (Note 6 and Note 7)—The Group performsimpairment reviews on the carrying amounts of its non-financial assets other than goodwill compared to itsrecoverable amount to determine whether there is any indication that those assets are impaired. The recoverableamount is the higher of the asset’s fair value less costs to sell or value in use.

Value in use is a valuation derived from the discounted future cash flows of the cash-generating units. Themost important estimates in determining the present value of cash flows are growth rates used to calculaterevenue growth and suitable discount rates in order to determine present value.

During fiscal year 2012, the amount recognised for the impairment of property plant and equipment andother intangible assets other than goodwill was €7.8 million and €13.5 million, respectively. In fiscal year 2011,the amount recognised for the impairment of property, plant and equipment was €5.6 million. Any significantchange in management estimates could potentially have a material impact on sales and profits in the future.

Sales recognition and incentives (Note 25)—Sales are recognised when title and risk of loss pass to thecustomer. As described in Note 2, the Group has a variety of sales incentives, including customer loyaltyprogrammes, that are offered to resellers and / or consumers of its products. Measuring the fair value of theseincentives requires, in many cases, estimating future customer utilisation, redemption rates and relative fairvalue. These incentives include coupons that have prescribed value, but where estimating customer utilisationand redemption rates is required. Historical data for similar transactions is used in estimating the fair value ofincentive programmes. These estimates are reviewed each period and adjusted based upon actual experience andother available information. Additionally, the Group has a significant number of trade incentive programmes andother factors outside of its control that impact the ultimate cost of these incentives. Any significant change inthese estimates could potentially have a material impact on sales and profits.

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Defined benefit plans and other post-employment benefits (Note 22)—The Group sponsors defined benefitplans and provides other post-employment benefits. Assumptions are an important element in the actuarialmethods that are used to measure the expense and obligations relative to employee benefits. The assumptionsused include discount rate, inflation and indexation, expected return on assets, mortality, payroll increase andhealth-care trends. Any change in these assumptions could potentially result in a significant change to thepension assets, pension liabilities, commitments and pension costs in future periods.

Sensitivity to changes in individual parameters used in fiscal 2012 can be estimated as follows:

• A 50 basis point decrease in the discount rate of interest would increase the defined benefit obligationby approximately €193 million;

• A 50 basis point increase in inflation assumption would increase the defined benefit obligation byapproximately €134 million;

• A 50 basis point increase in the salary growth rate would increase the defined benefit obligation byapproximately €9 million.

Income taxes (Note 21)—Due to the inherent complexities arising from the nature of the Group’s business,and from conducting business and being taxed in a substantial number of jurisdictions, significant judgementsand estimates are required to be made for income taxes. The Group computes income tax expense for each of thejurisdictions in which it operates. However, actual amounts of income tax due only become final upon filing andacceptance of the tax return by relevant authorities, which may not occur for several years subsequent to issuanceof these financial statements.

The estimation of income taxes also includes evaluating the recoverability of deferred income tax assetsbased on an assessment of the ability to use the underlying future tax deductions against future taxable incomebefore they expire. This assessment is based upon existing tax laws and estimates of future taxable income. Tothe extent estimates differ from the final tax return, earnings may be affected in a subsequent period.

Restructuring provisions (Note 23)—The Group records a provision for restructuring costs when a detailedformal plan for the restructuring has been determined and the plan has been communicated to the parties that maybe affected by it. The provision is based on a number of assumptions including the timing of the payments andthe number of employees that will ultimately receive the termination benefits. A change in these assumptionsmay result in a significant change in the liability in future periods. Adjustments to previously recorded chargesresulting from a change in estimate are recognised in the period in which the change is identified. Changes inestimates for fiscal years 2012, 2011 and 2010 decreased the provision by €2.0 million, €9.8 million, and€8.4 million, respectively. These changes primarily resulted from the completion of termination actions foramounts more favorable than originally estimated and from the forfeiture of termination benefits by certainemployees who elected to voluntarily end their employment.

Legal provision (Note 23)—The Group is involved in certain litigation and other legal proceedings. Theseclaims involve highly complex issues, actual damages and other matters. These issues are subject to substantialuncertainties and, therefore, the probability of loss and an estimation of damages are difficult to ascertain.

These assessments can involve a series of complex judgements about future events and can rely heavily onestimates and assumptions. The Group’s assessments are based on estimates and assumptions that have beendeemed reasonable by management. The Group recognises a liability for contingencies when it is more likelythan not that the Group will sustain a loss and the amount can be estimated. A change in these estimates couldresult in a significant impact on the Group’s future results.

Critical Judgements in Applying the Group’s Accounting Policies—The following are the criticaljudgements, apart from those involving estimations discussed above, that management made in the process ofapplying the Group’s accounting policies and that have the most significant effect on the amounts recognised inthe financial statements.

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Impairment of non-financial assets other than goodwill (Note 6 and Note 7)—The Group reviews thecarrying amounts of its non-financial assets other than goodwill to determine whether there is any indication thatthose assets are impaired. In making the assessment for potential indicators of impairment, management isrequired to make certain judgments when determining whether events or circumstances exist that indicate thecarrying amount may not be recoverable.

5. SEGMENT INFORMATION

Management has determined the operating segments, which are consistent with the reportable segments,based on the reports reviewed by the chief operating decision maker and used to make strategic decisions. Thechief operating decision maker considers the business from both a geographic and customer perspective. Theperformance of the business is monitored in three segments which derive their revenue primarily from the sale ofcoffee and tea products. The three segments include the following:

• Retail—Western Europe, which includes product sales in four categories: multi-serve, single-serve,instant coffee and tea, conducts its retail operations in the Netherlands, Belgium, France, Denmark,Greece, Germany, the United Kingdom and Spain. In addition, the cafés the Group operates in theNetherlands report through this segment.

• Retail—Rest of World, which includes product sales in four categories: multi-serve, single-serve,instant coffee and tea, conducts its retail operations in Brazil, Hungary, the Czech Republic, Poland,Australia, Thailand and Russia.

• Out of Home provides liquid roast coffee products and the machines that dispense these products, aswell as multi-serve coffee, instant coffee, tea and related products to businesses, hospitals, hotels,restaurants and distributors worldwide. These operations are primarily concentrated in the Netherlands,with sales predominantly in Western Europe.

The Group does not allocate certain revenue and costs to the segments. These unallocated items includeprimarily corporate overhead costs and unrealised mark to market gains and losses on commodity derivativefinancial instruments. They also include the sale of green coffee beans to third parties, which are ancillary to thebusiness and are not directly monitored by the chief operating decision maker. These items are presented as“unallocated” in the segment information that is presented below.

The chief operating decision maker uses Adjusted EBIT to assess the performance of the reportablesegments. Adjusted EBIT represents operating profit excluding the impact of any restructuring charges,impairment charges, gains and losses on the sale of assets, curtailments and past service cost, costs related toBranded Apparel and costs related to the termination of the prior Senseo agreement with Philips.

The accounting policies of the operating segments are the same as the Group’s accounting policies describedin Note 2.

F-33

The segment information for fiscal year 2012 is as follows (all amounts in thousands of Euro):

Retail—WesternEurope

Retail—Rest ofWorld Out of Home Unallocated Total

Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €1,264,163 €759,572 €636,916 €134,367 €2,795,018

Adjusted EBIT . . . . . . . . . . . . . . . . . . . . . . . . . . € 209,705 € 49,598 € 99,754 € (37,266) € 321,791

Restructuring charges (Note 23) . . . . . . . . . . . . (57,700)Restructuring—related expenses . . . . . . . . . . . . (62,956)Termination prior Senseo agreement . . . . . . . . . (55,337)Impairment charges . . . . . . . . . . . . . . . . . . . . . . (21,303)Branded Apparel costs . . . . . . . . . . . . . . . . . . . . (7,905)Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6,879)

Operating profit . . . . . . . . . . . . . . . . . . . . . 109,711Finance income, net . . . . . . . . . . . . . . . . . . . . . . 132,194Finance costs, net . . . . . . . . . . . . . . . . . . . . . . . . 17,442Share of profit (loss) from associate . . . . . . . . . 191

Profit before tax . . . . . . . . . . . . . . . . . . . . . . . . . € 259,538

Depreciation and amortisation expense . . . . . . . € 30,598 € 15,240 € 35,249 € 3,495 € 84,582

The segment information for fiscal year 2011 is as follows (all amounts in thousands of Euro):

Retail—WesternEurope

Retail—Rest ofWorld Out of Home Unallocated Total

Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €1,125,329 €647,047 €634,421 €186,517 €2,593,314

Adjusted EBIT . . . . . . . . . . . . . . . . . . . . . . . . . . € 218,069 € 44,970 €109,763 € (15,553) € 357,249

Restructuring charges (Note 23) . . . . . . . . . . . . (25,165)Restructuring—related expenses . . . . . . . . . . . . (7,824)Curtailment and past service costs . . . . . . . . . . . 13,075Impairment charges . . . . . . . . . . . . . . . . . . . . . . (5,638)Branded Apparel costs . . . . . . . . . . . . . . . . . . . . (3,520)Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,918)

Operating profit . . . . . . . . . . . . . . . . . . . . . 325,259Finance income, net . . . . . . . . . . . . . . . . . . . . . . 91,844Finance costs, net . . . . . . . . . . . . . . . . . . . . . . . . (45,430)Share of profit (loss) from associate . . . . . . . . . 2,233

Profit before tax . . . . . . . . . . . . . . . . . . . . . . . . . € 373,906

Depreciation and amortisation expense . . . . . . . € 31,378 € 15,025 € 36,157 € 3,764 € 86,324

F-34

The segment information for fiscal year 2010 is as follows (all amounts in thousands of Euro):

Retail—WesternEurope

Retail—Rest ofWorld Out of Home Unallocated Total

Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €1,053,420 €567,803 €613,831 € 78,309 €2,313,363

Adjusted EBIT . . . . . . . . . . . . . . . . . . . . . . . . . . € 253,259 € 36,266 €108,928 €(32,329) € 366,124

Restructuring charges . . . . . . . . . . . . . . . . . . . . . (5,415)Restructuring—related expenses . . . . . . . . . . . . (9,088)Branded Apparel costs . . . . . . . . . . . . . . . . . . . . (7,927)Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,761)

Operating profit . . . . . . . . . . . . . . . . . . . . . 341,933Finance income, net . . . . . . . . . . . . . . . . . . . . . . 55,299Finance costs, net . . . . . . . . . . . . . . . . . . . . . . . . 14,668Share of profit (loss) from associate . . . . . . . . . 2,702

Profit before tax . . . . . . . . . . . . . . . . . . . . . . . . . € 414,602

Depreciation and amortisation expense . . . . . . . € 31,844 € 12,886 € 34,596 € 4,665 € 83,991

The Group’s assets and liabilities are not disclosed by segment as they are not included in the segmentinformation used by the chief operating decision maker.

The Group generates its revenue from customers around the world including Europe, Asia, Australia andBrazil. The Group’s revenue from external customers, based on the location of the selling entity, and informationabout its noncurrent assets (excluding noncurrent financial assets, deferred income tax assets and pension assets)based on geographic location of the assets are as follows (all amounts in thousands of Euro):

Revenue from External Customersfor the Fiscal Year Ended Noncurrent Assets as of

2012 2011 2010 2012 2011 2010

CountriesNetherlands . . . . . . . . . . . . . . . . € 776,259 € 720,894 € 725,292 €315,097 €198,891 €219,267Brazil1 . . . . . . . . . . . . . . . . . . . . 582,653 546,310 350,166 117,209 127,682 87,548France . . . . . . . . . . . . . . . . . . . . 351,455 310,071 261,792 78,928 80,635 72,682Belgium . . . . . . . . . . . . . . . . . . 184,157 181,665 167,493 64,339 61,882 57,730Germany . . . . . . . . . . . . . . . . . . 158,615 159,209 152,010 26,915 21,175 21,061Australia . . . . . . . . . . . . . . . . . . 154,079 135,489 113,232 12,474 10,761 9,820Spain . . . . . . . . . . . . . . . . . . . . . 146,562 108,059 106,143 32,328 34,955 38,454Other . . . . . . . . . . . . . . . . . . . . . 441,238 431,617 437,235 116,964 102,119 102,700

Total . . . . . . . . . . . . . . . . . . . . . . . . . €2,795,018 €2,593,314 €2,313,363 €764,254 €638,100 €609,262

1 Brazil includes green coffee bean sales to third parties of €134,368, €186,516 and €78,310 in fiscal years2012, 2011 and 2010, respectively.

F-35

6. PROPERTY, PLANT AND EQUIPMENT

The movements of the property, plant and equipment are as follows (all amounts in thousands of Euro):

Land andBuildings

Machineryand

EquipmentConstructionin Progress Other Total

As of fiscal year 2010Cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 215,307 € 650,104 € 36,207 € 40,462 € 942,080Accumulated depreciation . . . . . . . . . . . . . . . (114,298) (436,694) — (25,444) (576,436)

Net book amount . . . . . . . . . . . . . . . . . . . . . . . . . . € 101,009 € 213,410 € 36,207 € 15,018 € 365,644

Fiscal year ended 2011Opening net book amount . . . . . . . . . . . . . . . € 101,009 € 213,410 € 36,207 € 15,018 € 365,644Business combination (Note 8) . . . . . . . . . . . 5,510 4,913 — — 10,423Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 500 37,227 38,990 947 77,664Disposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . (582) (8,537) — (129) (9,248)Foreign currency translation . . . . . . . . . . . . . (6) 562 443 14 1,013Depreciation expense . . . . . . . . . . . . . . . . . . . (7,702) (59,408) — (2,887) (69,997)Impairment charges . . . . . . . . . . . . . . . . . . . . — — (5,638) — (5,638)Transfers . . . . . . . . . . . . . . . . . . . . . . . . . . . . 628 29,990 (31,624) 1,006 —

Closing net book amount . . . . . . . . . . . . . . . . . . . . € 99,357 € 218,157 € 38,378 € 13,969 € 369,861

As of fiscal year 2011Cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 219,757 € 646,567 € 38,378 € 42,160 € 946,862Accumulated depreciation . . . . . . . . . . . . . . . (120,400) (428,410) — (28,191) (577,001)

Net book amount . . . . . . . . . . . . . . . . . . . . . . . . . . € 99,357 € 218,157 € 38,378 € 13,969 € 369,861

Fiscal year ended 2012Opening net book amount . . . . . . . . . . . . . . . € 99,357 € 218,157 € 38,378 € 13,969 € 369,861Business combination (Note 8) . . . . . . . . . . . 2,221 1,231 2 89 3,543Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 969 42,520 51,804 2,072 97,365Disposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,699) (6,091) (87) (411) (10,288)Foreign currency translation . . . . . . . . . . . . . (3,648) (3,096) (1,205) (292) (8,241)Depreciation expense . . . . . . . . . . . . . . . . . . . (8,061) (56,413) — (2,491) (66,965)Impairment charges . . . . . . . . . . . . . . . . . . . . (1,869) (5,686) — (283) (7,838)Transfers . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,951 24,533 (35,982) 498 —

Closing net book amount . . . . . . . . . . . . . . . . . . . . € 96,221 € 215,155 € 52,910 € 13,151 € 377,437

As of fiscal year 2012Cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 219,233 667,695 52,910 43,804 983,643Accumulated depreciation . . . . . . . . . . . . . . . (123,012) (452,540) — (30,653) (606,206)

Net book amount . . . . . . . . . . . . . . . . . . . . . . . . . . € 96,221 € 215,155 € 52,910 € 13,151 € 377,437

The construction in progress is primarily in Western Europe and relates to production lines and buildings.

Impairment of property, plant and equipment is included in selling, general and administrative expenses inthe income statement.

F-36

Depreciation expense is included in the income statements for the fiscal years ended 2012 and 2011, asfollows (all amounts in thousands of Euro):

2012 2011

Cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €35,037 €36,611Selling, general and administrative expenses . . . . . . . . . . . . . . . . . . . . 31,928 33,386

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €66,965 €69,997

The asset additions listed above include capitalised borrowing costs on qualified assets of €1.7 million,€0.7 million and €2.4 million determined based on a weighted average interest rate of 3.86%, 3.79% and 4.53%,for the fiscal years ended 2012, 2011 and 2010, respectively.

The Group has property in the Netherlands that has been pledged with a lien of €23.8 million as of fiscalyears 2012, 2011 and 2010 in favour of Stichting VUDE, a foundation which guarantees the payment of earlyretirement allowances and payments according to social plans in the Netherlands.

The Group leases various machinery and equipment under non-cancellable operating lease agreements. Thelease terms are generally between three and five years, and ownership of the assets remain with the Group. TheGroup has leased machinery and equipment under operating lease agreements for the following amounts (allamounts in thousands of Euro):

2012 2011

Cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 2,626 € 4,006Accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,415) (3,811)

Net book amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 211 € 195

The depreciation expense on the leased machinery and equipment recorded during the period was€0.1 million, €0.3 million and €0.9 million for the fiscal years ended 2012, 2011 and 2010, respectively.

The future aggregate minimum lease payments to be received under non-cancellable operating leases are asfollows (all amounts in thousands of Euro):

2012 2011

Not later than one year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 7,111 €10,445Later than one year and not longer than five years . . . . . . . . . . . . . . . . 15,851 18,211Later than five years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110 240

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €23,072 €28,896

F-37

7. GOODWILL AND OTHER INTANGIBLE ASSETS

The movements of the goodwill and other intangibles assets are as follows (all amounts in thousands ofEuro):

Goodwill TrademarksComputerSoftware Other Total

As of fiscal year 2010Cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €163,433 €108,502 € 134,868 € 6,441 € 413,244Accumulated amortisation and impairment . . . . — (65,816) (100,011) (3,799) (169,626)

Net book amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . €163,433 € 42,686 € 34,857 € 2,642 € 243,618

Fiscal year ended 2011Opening net book amount . . . . . . . . . . . . . . . . . €163,433 € 42,686 € 34,857 € 2,642 € 243,618Business combination (Note 8) . . . . . . . . . . . . . 17,396 12,045 — 3,507 32,948Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 8,126 — 8,126Disposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — (1,731) (292) (2,023)Foreign currency translation . . . . . . . . . . . . . . . 1,926 (218) 248 (59) 1,897Amortisation expense . . . . . . . . . . . . . . . . . . . . . — (6,066) (9,549) (712) (16,327)

Closing net book amount . . . . . . . . . . . . . . . . . . €182,755 € 48,447 € 31,951 € 5,086 € 268,239

As of fiscal year 2011Cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €182,755 €120,519 € 141,660 € 9,685 € 454,619Accumulated amortisation and impairment . . . . — (72,072) (109,709) (4,599) (186,380)

Net book amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . €182,755 € 48,447 € 31,951 € 5,086 € 268,239

Fiscal year ended 2012Opening net book amount . . . . . . . . . . . . . . . . . €182,755 € 48,447 € 31,951 € 5,086 € 268,239Business combination (Note 8) . . . . . . . . . . . . . 12,143 10,392 — 2,675 25,210Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 115,087 19,887 — 134,974Disposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — — — —Foreign currency translation . . . . . . . . . . . . . . . (7,754) (2,700) 120 (189) (10,523)Amortisation expense . . . . . . . . . . . . . . . . . . . . . — (6,535) (10,041) (1,041) (17,617)Impairment charge . . . . . . . . . . . . . . . . . . . . . . . — — (13,466) — (13,466)

Closing net book amount . . . . . . . . . . . . . . . . . . €187,144 €164,691 € 28,451 € 6,531 € 386,817

In March 2012 the Group entered into agreements to pay €115 million to Philips Electronics (“Philips”) toacquire its ownership interest in the Senseo coffee trademark. This acquisition provided the Group with fullownership of the Senseo trademark, which was previously co-owned with Philips. In connection with thistransaction the Group also agreed to pay an additional €55 million to Philips to terminate the prior Senseo coffeeequipment manufacturing agreement and to reimburse Philips for other project costs which were expensed.

Other primarily represents customer relationship intangibles acquired through business combinations.

Amortisation expense is included in the income statements as follows (all amounts in thousands of Euro):

2012 2011

Cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 472 € 420Selling, general and administrative expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,145 15,907

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €17,617 €16,327

The Group recognised an impairment charge of €13.5 million following the decision made to abandoncertain software developments.

F-38

The Group has one indefinite-lived trademark, Hornimans, in the amount of €8 million as of each fiscal year2012 and 2011. The Group determined that an indefinite useful life is appropriate based on an analysis of all ofthe relevant factors, and because there is no foreseeable limit to the period over which the asset is expected togenerate net cash inflows for the Group.

Impairment Tests for Goodwill and Indefinite-Lived Trademarks—Goodwill and the indefinite-livedtrademarks allocated to the Retail CGU’s for Brazil, France and Poland are considered to be significant incomparison to the total book value of goodwill for the Group as of fiscal years 2012 and 2011. The carryingamount of goodwill per CGU is as follows (all amounts in thousands of Euro):

2012 2011

Retail CGUsPoland . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 46,110 € 49,473France . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46,108 46,108Brazil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,581 32,235Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65,345 54,939

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €187,144 €182,755

The Group determines recoverable amounts of its CGU’s based on a consideration of the higher of a CGU’sfair value less costs to sell and its value in use. If the recoverable amount is supported by its value in use, noassessment of the fair value less costs to sell is performed. Fair value less costs to sell is the best estimate of theamount obtainable from the sale of a CGU in an arm’s length transaction between knowledgeable, willingparties, less the costs of disposal. This estimate is determined on the basis of available market information,including considerations of: (i) the discounted present value of future cash flows over a five-year period, plus aterminal value, and (ii) EBIT multiples for comparable companies.

Value in use is the present value of the future cash flows expected to be derived from the CGU’s. Keyassumptions used in the impairment tests for the units in the table above were sales growth rates and the ratesused for discounting the projected cash flows. The Group based growth rates and margins used to estimate cashflows on past performance, external market growth assumptions, and forecast trading conditions drawn up by theGroup’s management. Cash flow projections are primarily based on three-year business plans. Cash flowprojections beyond that timeframe are extrapolated by applying a growth rate over the next two years, followedby a growth rate to perpetuity reflecting the expected long-term growth in the market. The Group discounts thecash flows using appropriate rates for the type and size of business and the countries concerned.

The key assumptions used by the Group for the fair value calculations for fiscal year 2012 are as follows:

Compound Sales Growth

ForecastPeriod

ExtrapolationPeriod

TerminalValue

DiscountRate

Retail CGUsPoland . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7% 3% 2% 11.0%France . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8% 3% 2% 8.6%Brazil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5% 4% 3% 10.4%

The key assumptions used by the Group for the fair value calculations for fiscal year 2011 are as follows:

Compound Sales Growth

ForecastPeriod

ExtrapolationPeriod

TerminalValue

DiscountRate

EBITMultiple

Retail CGUsPoland . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4% 3% 2% 11.9% N/AFrance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11% 3% 2% 9.7% N/ABrazil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10% 4% 3% 12.1% 12.0

F-39

The annual impairment testing performed by the Group each fiscal year did not result in any instance wherethe carrying value of the CGU including goodwill exceeded the recoverable amount. In assessing the goodwill inBrazil, in fiscal year 2012 a sensitivity analysis was performed using a 1% increase in discount rate, which wouldnot have resulted in an impairment. Although management currently believes the beverage operations in Brazilcan support the value of its recorded goodwill, a change in assumptions driven by macro-economic conditions ordegradation in the Brazilian consumer coffee market that undermines the CGU’s ability to achieve targeted profitlevels may result in an impairment of their recorded goodwill.

8. BUSINESS COMBINATIONS

Fiscal year 2012 acquisitions—In December 2011, the Group acquired CoffeeCompany, a leading Dutchcafé store operator in the Netherlands; Tea Forte, a producer of ultra premium teas that are principally sold in theUnited States and Canada; the Denmark operations of House of Coffee, a leading out of home provider of coffeeand tea products in Norway and Denmark. In April 2012, the Group acquired Expresso Coffee Automacao deBebidas Quentes Ltda, an out of home provider which offers its customers a full service concept (machines,coffee and service) mainly in the Sao Paulo area.

The total consideration for these acquisitions was €23.4 million, plus a performance-based contingentpurchase price payment of €1 million which was recognised as a liability. As of June 2012, the Group hasestimated the contingent payment to be €1 million. As a result of the transactions, goodwill and other intangibleassets of €25 million were recognised. Further adjustments could be made to this balance as the Group finalisesits accounting for the acquisitions.

In December 2011, the Norway operations of the House of Coffee business were acquired by the Group’sNorwegian associate, Kaffehuset Friele, in which the Group holds a non-controlling interest.

Café Damasco—On 30 November 2010, the Group acquired 100% of the shares of Café Damasco, aBrazilian coffee company. The total purchase consideration was approximately €43.2 million, of which€24.1 million was paid at closing. The remaining consideration of Brazilian real (“R$”) 42.8 million(approximately €19.1 million at the acquisition date) is payable in installments over a five year period. Theacquisition financing provided by the seller is included in Borrowings (see Note 19). The fair value of the totalconsideration was €37.4 million, which represents the cash paid with the acquisition financing on a discountedbasis. In addition, the Group assumed outstanding borrowings of €7.1 million as part of the acquisition. TheGroup incurred transaction costs of €0.5 million, which were expensed at the date of acquisition.

The allocation of the net assets acquired and goodwill arising at the acquisition date are as follows (allamounts in thousands of Euro):

Working capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 1,078Property, plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,423Trademarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,045Other intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,507Borrowings assumed on acquisition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (7,094)Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,396

Total purchase price at fair value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €37,355

The purchase of Café Damasco gives the Group a stronger presence in southern Brazil. Goodwill recognisedis attributable to this stronger presence in southern Brazil, the synergies to be achieved between the Group’sexisting operations and those of Café Damasco, and the non-assembled structured workforce that does notqualify for recognition separate from goodwill.

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The operations of Café Damasco and the related financial reporting were fully integrated upon acquisition,and as a consequence the Group has not disclosed the revenues and profit included in its results as a result of thisacquisition. Additionally, limited financial information was available relative to Café Damasco prior to theacquisition date. Therefore, it is not practicable to provide disclosures related to revenue or profit as if CaféDamasco had been included throughout the entire period.

9. INVESTMENTS IN ASSOCIATE

The Group has an investment in associate, details of which are summarised below (amounts in thousands ofEuro):

2012 2011

Carrying amount at beginning of the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €15,675 €15,161Share of profit for the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 191 2,233Dividends received . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (588) (2,299)Other changes in equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,711) 580

Carrying amount at end of the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €12,567 €15,675

The investments in associate consist of an investment of approximately 45% in Kaffehuset Friele, aNorwegian company that produces coffee for distribution to out of home and retail customers. Based on itsassessment of voting power and other factors of control, management concluded that it had significant influenceover Kaffehuset Friele.

Summarised financial information with respect to the associate is set out below (all amounts in thousands ofEuro, 100% basis).

Assets Liabilities RevenuesProfit

after Tax

2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €96,841 €86,466 €109,352 € 4252011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €72,705 €55,328 € 88,654 €4,962

10. FINANCIAL INSTRUMENTS BY CATEGORY

Financial instruments by category as of fiscal year 2012 are comprised of the following (all amounts inthousands of Euro):

Loans andOther

Receivables

Asset/liabilities atFair Value

Through theProfit and

Loss

DerivativesUsed forHedging

OtherFinancial

Liabilities atAmortised

Cost Total

Noncurrent:Other noncurrent financial assets . . . . . . . € 46,855 € — €— € — € 46,855

Current:Trade and other receivables . . . . . . . . . . . 421,593 — — — 421,593Derivative financial instruments . . . . . . . . — 22,268 — — 22,268Cash and cash equivalents . . . . . . . . . . . . . 220,343 — — — 220,343

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . 688,791 €22,268 €— € — € 711,059

Noncurrent:Borrowings . . . . . . . . . . . . . . . . . . . . . . . . € — € — €— € 528,958 € 528,958

Current:Borrowings . . . . . . . . . . . . . . . . . . . . . . . . — — — 28,456 28,456Trade and other payables . . . . . . . . . . . . . — — — 630,543 630,543Derivative financial instruments . . . . . . . . — 15,496 — — 15,496

Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . € — €15,496 €— €1,187,957 €1,203,453

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Financial instruments by category as of fiscal year 2011 are comprised of the following (all amounts inthousands of Euro):

Loans andOther

Receivables

Asset/liabilities atFair Value

Through theProfit and

Loss

DerivativesUsed forHedging

OtherFinancial

Liabilities atAmortised

Cost Total

Noncurrent:Derivative financial instruments . . . . . . . € — € 153 € — € — € 153Other noncurrent financial assets . . . . . . . 21,322 — — — 21,322Receivables from Sara Lee . . . . . . . . . . . 494,826 — — — 494,826

Current:Trade and other receivables . . . . . . . . . . . 335,043 — — — 335,043Derivative financial instruments . . . . . . . — 6,824 — — 6,824Receivables from Sara Lee . . . . . . . . . . . 1,221,531 — — — 1,221,531Cash and cash equivalents . . . . . . . . . . . . 1,342,594 — — — 1,342,594

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . €3,415,316 €6,977 € — € — €3,422,293

Noncurrent:Borrowings . . . . . . . . . . . . . . . . . . . . . . . . € — € — € — € 17,316 € 17,316

Current:Borrowings . . . . . . . . . . . . . . . . . . . . . . . . — — — 345,819 345,819Trade and other payables . . . . . . . . . . . . . — — — 563,260 563,260Derivative financial instruments . . . . . . . — 7,673 1,374 — 9,047Payables to Sara Lee . . . . . . . . . . . . . . . . — — — 1,120 1,120

Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . € — €7,673 €1,374 €927,515 € 936,562

11. DERIVATIVE FINANCIAL INSTRUMENTS

The Group uses derivative financial instruments, including forward exchange, futures, options and swapcontracts, to manage its exposures to foreign exchange, commodity prices and interest rate risks. The use of thesederivative financial instruments modifies the exposure of these risks with the intent to reduce the risk or cost tothe Group. The Group does not use derivatives for trading or speculative purposes and is not a party to leveragedderivatives. Maturity of the interest rate, foreign exchange and commodity contracts are primarily within oneyear.

Information on the classification and fair values of derivatives in the statements of financial position is asfollows (all amounts in thousands of Euro):

Assets Liabilities

DerivativeFinancial

Instruments(Current)

DerivativeFinancial

Instruments(Noncurrent)

DerivativeFinancial

Instruments(Current)

DerivativeFinancial

Instruments(Noncurrent)

2012 2011 2012 2011 2012 2011 2012 2011

Derivatives designated as hedginginstruments:

Interest rate contracts . . . . . . . . . . . . . . . . . € — € — €— €— € — €1,374 €— €—

Total derivatives designated as hedging asinstruments . . . . . . . . . . . . . . . . . . . . . . . — — — — — 1,374 — —

Foreign exchange contracts . . . . . . . . . . . . . 20,575 6,079 — 153 8,303 7,673 — —Commodity contracts . . . . . . . . . . . . . . . . . 1,683 745 — — 7,193 — — —

Total derivatives not designated as hedginginstruments . . . . . . . . . . . . . . . . . . . . . . . 22,258 6,824 — 153 15,496 7,673 — —

Total derivatives . . . . . . . . . . . . . . . . . . . . . €22,258 €6,824 €— €153 €15,496 €9,047 €— €—

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Interest RateContracts

ForeignExchangeContracts

CommodityContracts Total

Year Ended Year Ended Year Ended Year Ended

2012 2011 2010 2012 2011 2010 2012 2011 2010 2012 2011 2010

Fair value derivatives:Amount of derivative

gain (loss)recognised inearnings(a) . . . . . . . . €(1,603) €(1,345) €1,141 € — € — € — € — € — € — €(1,603) € (1,345) € 1,141

Amount of hedgeditem gain (loss)recognised inearnings(a) . . . . . . . . — 2,347 (429) — — — — — — — 2,347 (429)

Derivatives notdesignated ashedging instruments:

Amount of gain (loss)recognised in cost ofsales . . . . . . . . . . . . . — — — — — — 8,384 11,075 (913) 8,384 11,075 (913)

Amount of gain (loss)recognised infinance income/expense . . . . . . . . . . — — — (5,642) 15,499 (9,769) — — — (7,799) 15,499 (9,769)

(a) The amount of gain (loss) recognised in earnings on the derivative contracts and the related hedged item is reported in financecosts.

Interest rate swaps—The Group had three interest rate swaps that convert fixed-rate debt to floating rate debt. Asof fiscal year 2012 there are no more interest rate swaps designated as hedging instruments due to the repayment of thefixed interest debt as well as the hedging instrument. As of fiscal year 2011 the total notional amount of the Group’sinterest rate swaps was €300 million and the fixed interest on the swaps varied from 1.79% to 1.64%.

Currency forward exchange, futures and option contracts—There were no foreign exchange option contractsoutstanding at the end of fiscal years 2012 and 2011. The Euro equivalent of commitments to purchase and sell foreigncurrencies is €1.7 billion and €1.7 billion, respectively, as of fiscal year 2012 and €1.2 billion and €1.2 billion,respectively, as of fiscal year 2011. The position primarily consists of US dollar and the contracts mature within oneyear.

Commodity futures and options contracts—As of fiscal years 2012 and 2011, the total notional amount ofcommodity futures contracts was €37.9 million and €52.8 million, respectively, and the total notional amount ofcommodity option contracts was €12.7 million as of fiscal year 2012 and €50.5 million as of fiscal year 2011. Thenotional amount of commodity futures contracts is determined by the initial cost of the contracts while the notionalamount of options contracts is determined by the ratio of the change in option value to the change in the underlyinghedged item.

12. OTHER NONCURRENT FINANCIAL ASSETS

The composition of other noncurrent assets is as follows (all amounts in thousands of Euro):

2012 2011

Lease receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €18,946 €18,451Other noncurrent assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,909 2,871

€46,855 €21,322

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13. INVENTORIES

The composition of inventories is as follows (all amounts in thousands of Euro):

2012 2011

Raw materials (including packaging) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €201,027 €229,875Work in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,607 13,581Finished goods (including Out of Home machines) . . . . . . . . . . . . . . . . . . . . . 201,279 200,328

415,913 443,784Provision for write downs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (11,050) (6,239)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €404,863 €437,545

The changes in the provision for write downs were as follows (all amounts in thousands of Euro):

2012 2011 2010

Carrying amount at beginning of the year . . . . . . . . . . . . . . . . . . . . . € (6,239) €(5,517) €(7,101)Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5,266) (3,779) (4,670)Used/released . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 599 3,068 6,542Currency translation differences . . . . . . . . . . . . . . . . . . . . . . . . . . . . (144) (11) (288)

End of the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €(11,050) €(6,239) €(5,517)

14. TRADE AND OTHER RECEIVABLES

The composition of trade and other receivables is as follows (all amounts in thousands of Euro):

2012 2011

Trade receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €295,142 €262,040Provision for impairment of trade receivables . . . . . . . . . . . . . . . . . . . . . . . . . (12,873) (12,036)

Trade receivables—net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 282,269 250,004Prepaid non-income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53,999 33,642Prepaid assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,791 14,488Lease receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,801 10,445Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,795 9,907Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44,938 16,557

€421,593 €335,043

The changes in the provision for impairment for trade receivables were as follows (all amounts in thousandsof Euro):

2012 2011 2010

Carrying amount at beginning of the year . . . . . . . . . . . . . . . . . . . . . €12,036 €12,142 €11,131Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,703 1,508 2,065Used . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (558) (1,708) (1,294)Currency translation differences . . . . . . . . . . . . . . . . . . . . . . . . . . . . (308) 94 240

Carrying amount at end of the year . . . . . . . . . . . . . . . . . . . . . . . . . . €12,873 €12,036 €12,142

The creation and release of the provision for impaired receivables have been included in selling, general andadministrative expenses in the income statements. Amounts charged to the provision are generally written offwhen there is no expectation of recovering additional cash.

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The aging analysis of trade receivables that were past due, but not impaired is as follows (all amounts inthousands of Euro):

2012 2011

Current . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 232,372 168,746Past due up to three months . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51,481 71,224Past due between three and six months . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,109 7,991Past due more than six months . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,180 14,079

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €295,142 €262,040

The Group’s past due but not impaired trade receivables relate to a number of independent customers forwhom there is no history of default.

15. CASH AND CASH EQUIVALENTS

The composition of cash and cash equivalents is as follows (all amounts in thousands of Euro):

2012 2011 2010

Cash in bank and on hand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €113,581 € 71,020 € 31,892Short-term bank deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106,762 1,271,574 631,870

Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €220,343 €1,342,594 €663,762

The amount of cash and cash equivalents on the statements of financial position (as shown above) differsfrom cash and cash equivalents on the statements of cash flows. For the purposes of the statements of cash flows,cash and cash equivalents includes cash on hand and in banks, net of outstanding bank overdrafts. Cash and cashequivalents as of each fiscal year, as shown in the statements of cash flows, can be reconciled to the cash andcash equivalents shown on the statements of financial position as follows (all amounts in thousands of Euro):

2012 2011 2010

Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €220,343 €1,342,594 €663,762Bank overdrafts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5,061) (3,545) (5,708)

Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €215,282 €1,339,049 €658,054

16. SHAREHOLDERS’ EQUITY AND PARENT’S NET INVESTMENT

Prior to the consolidation of the international coffee and tea business of Sara Lee into the Company, theGroup’s equity represented Sara Lee’s investment in the combined entities of the coffee and tea business, or SaraLee’s net investment. Following the Separation, the Group’s equity represents the Company’s issued andoutstanding share capital, additional paid in capital and reserves.

Prior to Separation—Parent’s Net Investment

The separate legal entities that comprise the Group were not held by a single legal entity prior to Separationand, consequently, Parent’s net investment was shown in lieu of shareholders’ equity in these financialstatements. Parent’s net investment represents the cumulative net investment by Sara Lee in the Group throughthat date.

Impact of Separation from Sara Lee on Equity

As described in Note 1, there were a number of transactions entered into to consummate the Separation.These resulted in a reduction in parent’s net investment. In addition, as stated in Note 1, prior to the Separationthe Group adjusted its income taxes as a result of the income tax balances prior to the Separation being preparedon a separate company basis as opposed to consolidated post Separation.

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The following summarises the impact of the transactions related to the Separation on parent’s netinvestment (all amounts in millions of euro):

Impact of conversion for income taxes (see Note 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105.6Assumption of net liabilities (see Note 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (241.6)Contributed working capital (see Note 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.0Issuance of debt securities in exchange for international and coffee business (see

Note 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,632.8)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €(1,762.8)

Post Separation—Shareholders’ Equity

As described above and in Note 1, 594,859,274 shares of the Company were issued to Sara Lee shareholdersin connection with the Separation. Upon the completion of the Separation, the parent’s net investment wasconverted into shareholders’ equity. The parent’s net investment was converted as follows:

• Share capital: share capital was established based on the par value of €0.12 per share for the sharesissued in connection with the Separation;

• Additional paid in capital: the remaining parent’s net investment, after recording share capital, wasreflected as additional paid in capital.

As of the end of fiscal 2012, the Company has 2,974,296,370 authorised shares and 594,859,274outstanding shares each with a par value of €0.12. The fully paid ordinary shares carry one vote per share and aright to dividends. The Group’s ability to declare dividends is limited to distributable reserves as defined byapplicable law.

17. EARNINGS PER SHARE

Earnings per share is computed by dividing profit attributable to the shareholders of the Company by theweighted average number of common shares outstanding for the period.

The average shares outstanding, which is the number issued in connection with the Separation was 595million.

The earnings per share for the periods prior to the Separation were computed as if the shares issued atSeparation were outstanding for all periods presented.

18. SHARE-BASED PAYMENT

The share-based payment awards included in these financial statements were granted under various plansincluding awards granted by Sara Lee to the Group’s employees. The compensation expense associated with theawards granted by Sara Lee has been reflected in these financial statements as the Group receives the employeeservices that are provided in exchange for the awards.

The Group recognised total share based compensation expense of €7.8 million, €4.6 million and€3.6 million in fiscal years 2012, 2011 and 2010, respectively. The total expense in fiscal year 2012 reflects€2.6 million related to awards under the 2012 LTIP (as defined below) and €5.2 million related to awards grantedby Sara Lee to employees of the Group. The expense in fiscal year 2011 and 2010 related fully to awards grantedby Sara Lee to employees of the Group.

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Description of the Plans under which Awards were granted to Employees of the Group

The plans under which the awards were granted during the periods presented and the impact of theSeparation on these awards are as described below.

Historical Sara Lee Plans

• Performance Share Awards Granted by Sara Lee (“Sara Lee PSUs”)—Sara Lee granted Sara LeePSUs to employees of the Group during fiscal year 2012. These awards vest based on the continuedemployment of the participants by the Group through August 2014 with the number of awards eligibleto vest on that date determined based on Sara Lee’s performance during fiscal year 2012 compared totargeted financial performance established at the date of grant. The Group achieved a performance thatresulted in an award of 80.06% for the performance element of the award. The obligation to settle theseawards was an obligation of Sara Lee. In connection with the Separation, the obligation to settle theseawards was transferred to D.E MASTER BLENDERS with the number of awards adjusted to maintainthe pre-Separation intrinsic value of the Sara Lee PSUs. Accordingly, this adjustment to maintain thepre Separation intrinsic value did not result in any incremental fair value to be recognized related tothese awards.

• Restricted Stock Units Granted by Sara Lee (“Sara Lee RSUs”)—Sara Lee granted Sara Lee RSUs tocertain employees of the Group to incent performance and retention over periods ranging from one tothree years. Upon the achievement of defined parameters, the Sara Lee RSUs generally converted intoshares of Sara Lee’s common stock on a one-for-one basis. A substantial portion of the Sara Lee RSUsvested solely upon continued service. A small portion of Sara Lee RSUs vested based upon continuedfuture employment and the achievement of certain defined performance measures. All Sara Lee RSUsvested immediately at Separation. Sara Lee retained the obligation to settle the Sara Lee RSUs in itsshares except for the RSUs granted in fiscal year 2012 to the Group’s chief executive offer (“CEO”).

In connection with the Separation, the Group assumed the obligation to settle the Sara Lee RSUs heldby its CEO. The number of Sara Lee RSUs was adjusted, in a manner similar to the Sara Lee PSUsdescribed above, to maintain the pre Separation intrinsic value of the Sara Lee RSUs.

• Stock Options Granted by Sara Lee (“Sara Lee Stock Options”)—Sara Lee granted Sara Lee StockOptions to certain employees of the Group during fiscal year 2011 and 2010. The exercise price of eachstock option equaled the market price of Sara Lee’s common stock on the date of grant and was statedin U.S. dollars. The exercise price of the option granted was in U.S. dollars. The Sara Lee StockOptions were generally exercisable over a maximum term of 10 years. The stock options generally hada cliff vesting date with the compensation expense recognised on a straight-line basis during thevesting period. Sara Lee granted the Sara Lee Stock Options directly to the Group’s employees and hadthe obligation to settle the awards. The Sara Lee Option holders had a choice at the Separation to eitheraccelerate the vesting of the stock options with a six month period to exercise the stock options or tocontinue to hold their options based on the normal terms. In connection with the Separation, Sara Lee(subsequently renamed Hillshire Brands) retained the obligation to settle these stock options. At thetime of exercise and settlement of the awards, the number of shares issued will be adjusted to preservetheir pre-Separation intrinsic value.

D.E MASTER BLENDERS Plans

• 2012 Long-term Incentive Plan (“2012 LTIP”)—The 2012 LTIP was established during fiscal year2012 to award performance share awards (“PSUs”) to employees of the Group. Under this plan, anaward of PSUs may be granted to the CEO, the members of the Group’s executive committee, highlycompensated executives and, potentially, other key employees designated by the remunerationcommittee. The vesting of these PSUs is based on the participant’s continued service with the Groupfor the period established in each issuance of awards and based on the Group’s total shareholder return

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(the “TSR”) relative to a predefined comparative group of companies. The number of shares that willbe issued in exchange for the awards is dependent on the level of the TSR relative to the comparativegroup of companies, with the number of shares issued in exchange of the award ranging from zero totwo shares of D.E MASTER BLENDERS for each PSU.

Share Based Payment Awards Issued to Employees of the Group under the Plans

Fiscal years 2011 and 2010 Grants—During fiscal years 2011 and 2010 employees of the group weregranted Sara Lee RSUs and Sara Lee Options. The number of awards and the grant date fair value are describedlater in this note.

Fiscal year 2012—There were awards issued to employees of the Group under various plans during fiscalyear 2012. These awards are described below and reflected in the detailed disclosures provided later in this note.

• Sara Lee PSUs—In November 2011 and January 2012 Sara Lee granted Sara Lee PSUs to certainemployees of the Group. This grant is also referred to as the 1/3 grant. As described above, theobligation to settle these awards transferred to D.E MASTER BLENDERS in connection with theSeparation. The fair value of these awards was determined based on the share price of the underlyingshares of Sara Lee on the grant date.

• Sara Lee RSUs—On 31 January 2012, Sara Lee granted Sara Lee RSUs to the Group’s CEO with agrant date fair value of €500,000. As described above, the obligation to settle the Sara Lee RSUSgranted to the Group’s CEO transferred to D.E MASTER BLENDERS in connection with theSeparation.

• 2012 LTIP—During fiscal year 2012 the Group communicated to certain employees its intent to issuefuture awards to these individuals under the 2012 LTIP. The Group recognised compensation expenseassociated with these awards from the service commencement date. For awards where the servicecommencement date was prior to the grant data, the Group has estimated the fair value of the grant asof the future grant date to record compensation expense for fiscal year 2012. The grant date fair valueof these awards will be determined applying Monte Carlo simulation.

Summary of Awards Granted to Employees of the Group by Plan

Historical Sara Lee Plans

• Sara Lee PSUs—Sara Lee granted 229,890, Sara Lee PSUs to employees of the Group during fiscalyear 2012 with a total grant date fair value of $4.2 million. There were 22,710 of these awards forfeitedduring the year. As described above, the obligation to settle the Sara Lee PSU awards was assumed byD.E MASTER BLENDERS in connection with the Separation and the number of awards was adjustedto maintain the pre Separation intrinsic value.

• Sara Lee RSUs—A summary of the changes in the Sara Lee RSUs outstanding and issued to employeesof the Group is presented below (units in thousands):

2012Sara Lee

RSUs

Weighted-AverageGrant-

Date FairValue

Nonvested as of fiscal year 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,594 $12.41Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — —Vested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,440) 12.39Net transfers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 12.46Forfeited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (201) 12.57

Nonvested as of fiscal year 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — $ —

F-48

In addition, 35,204 Sara Lee RSUs were granted to the Group’s CEO during fiscal 2012 with a totalgrant date fair value of €500,000. As noted above, the obligation to settle the Sara Lee RSUs granted tothe Group’s CEO transferred to D.E MASTER BLENDERS in connection with the Separation and thenumber of awards was adjusted to maintain the pre Separation intrinsic value.

2011Equityawards

Weighted-AverageGrant-

Date FairValue

Nonvested as of fiscal year 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,638 $12.61Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 517 14.72Vested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (537) 14.79Net transfers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76 12.68Forfeited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (100) 15.04

Nonvested as of fiscal year 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,594 $12.41

2010Equityawards

Weighted-AverageGrant-

Date FairValue

Nonvested as of fiscal year 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,667 $14.68Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 777 9.96Vested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (439) 14.39Net transfers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (114) 14.71Forfeited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (253) 14.07

Nonvested as of fiscal year 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,638 $12.61

• Sara Lee RSUs granted to employees that were employed by Sara Lee prior to the Separation andtransferred in or out of the Group are reflected in net transfers above. The Group recognises an expenseonly for the portion of the vesting period in which the employee is employed by the Group and anyassociated amount transferred in or out as a result of transfers is reflected within the change in parent’snet investment.

• Sara Lee Stock Options—A summary of the changes in stock options outstanding to the Group’semployees under the Sara Lee stock option plans is presented below (options in thousands):

2012 Options

WeightedAverageExercise

Price

Range ofExercise Prices for

OutstandingOptions

at Year End

Weighted-AverageRemainingContractual

Term(Years)

Options outstanding as of fiscal 2011 . . . . . . . 3,272 $15.64 $ 9.79 – 22.09 4.3Forfeited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (150) 11.00 — —Exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,554) 16.37 — —Expired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (510) 18.81 — —To be settled by Sara Lee after Separation . . . (1,058) 13.68 — —

Options outstanding as of fiscal year 2012 . . . —

Options exercisable as of fiscal year 2012 . . . —

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2011 Options

WeightedAverageExercise

Price

Range ofExercise Prices for

OutstandingOptions

at Year End

Weighted-AverageRemainingContractual

Term(Years)

Options outstanding as of fiscal year 2010 . . . 3,258 $15.91 $ 8.48 – 26.89 4.3Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 376 14.75 — —Forfeited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (108) 16.16 — —Exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (220) 17.66 — —Expired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (34) 17.19 — —

Options outstanding as of fiscal year 2011 . . . 3,272 $15.64 $ 9.79 - 22.09 4.3

Options exercisable as of fiscal year 2011 . . . 2,387 $ 14.32 – 22.09

2010 Options

WeightedAverageExercise

Price

Range ofExercise Prices for

OutstandingOptions

at Year End

Weighted-AverageRemainingContractual

Term(Years)

Options outstanding as of fiscal year 2009 . . . 4,400 $17.55 $ 8.48 – 26.89 2.8Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 642 9.84 — —Forfeited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (774) 17.74 — —Exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (225) 13.32 — —Expired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (785) 19.06 — —

Options outstanding as of fiscal year 2010 . . . 3,258 $15.91 $ 8.48 - 22.09 4.3

Options exercisable as of fiscal year 2010 . . . 2,387 $ 8.48 – 22.09

The obligation to settle the stock options will remain the responsibility of Sara Lee and the Group hasno responsibility to settle any element of the awards post Separation.The weighted-average share prices at grant date during the period were $14.75 and $9.84 for the fiscalyears 2011 and 2010, respectively. The weighted-average exercise prices for share options exercisedduring the period were $16.37, $17.66 and $13.32 for the fiscal years 2012, 2011 and 2010,respectively. The weighted-average share prices at the date of exercise for share options exercisedduring the period were $20.90, $19.02 and $14.08 for the fiscal years 2012, 2011 and 2010,respectively.The fair value of each option grant was estimated on the date of grant using the Black-Scholes option-pricing model and the following weighted-average assumptions:

2011 2010

Weighted-average expected lives . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2 years 8.0 yearsWeighted-average risk-free interest rates . . . . . . . . . . . . . . . . . . . . . . 2.08% 3.03%Weighted-average expected volatility . . . . . . . . . . . . . . . . . . . . . . . . 28.00% 27.20%Dividend yield . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.90% 4.40%Sara Lee used a historical volatility for a period of time that was comparable to the expected life of theoption to determine volatility assumptions. The weighted-average grant date fair values of optionsgranted were $3.21 and $1.81 for the fiscal years 2011 and 2010, respectively. No options were grantedduring fiscal year 2012.

D.E MASTER BLENDERS Plans• 2012 LTIP—The Group communicated to certain employees a commitment to issue awards with a

value of €11.4 million. In addition, Sara Lee committed to its executive chairman, who is now theGroup’s non-executive chairman, that he would be granted awards with value of €1.75 million to whichthe 2012 LTIP terms would also apply. The Group recorded compensation expense of €2.6 million infiscal year 2012 for the services received between the award commitment date and the end of fiscalyear 2012.

F-50

Summary of D.E MASTER BLENDERS Obligations

As described above, the obligation to settle all Sara Lee PSUs and the obligation to settle the Sara Lee RSUsissued in fiscal year 2012 to the Group’s CEO were transferred to D.E MASTER BLENDERS in connection withthe Separation. The number of awards was adjusted to maintain the pre Separation intrinsic value of the awards.

The maximum number of shares D.E MASTER BLENDERS would need to deliver to settle the Sara LeePSUs is 309,789, which may decrease dependent on the achievement of the continued service vesting conditionsdescribed above.

The number of shares D.E MASTER BLENDERS will be required to deliver to settle the Sara Lee RSUsissued to the Group’s CEO is 59,254.

D.E MASTER BLENDERS also assumed the obligation to settle the following awards granted by Sara Leeprior to the Separation:

• Awards held by the executive chairman of Sara Lee: Sara Lee issued certain performance share awardsand restricted share awards to the executive chairman of the Sara Lee board of directors who is alsonow the non-executive chairman of the Group. In connection with the Separation Sara Lee assumed theobligation to settle the 136,934 vested awards. These awards were adjusted at the time of theSeparation to maintain the pre Separation intrinsic value. D.E MASTER BLENDERS will be requiredto deliver 207,503 of its shares to settle these awards.

• Awards held by the non employee directors of Sara Lee: The non employee directors of Sara Lee heldSara Lee RSUs at the time of Separation. The awards held by these individuals were not settled at thetime of Separation but will instead be settled six months after the termination of their membership onthe post Separation board of Sara Lee. The obligation to settle these Sara Lee RSUs was retained bySara Lee. In order to maintain the pre Separation intrinsic value of these awards, an additional awardwas issued to these individuals in connection with the Separation. D.E MASTER BLENDERS isrequired to settle the additional award. The number of shares to be issued under these awards wasadjusted to maintain the pre Separation intrinsic value. As the new award did not result in anyadditional fair value to the participant, there was no expense associated with the award. D.E MASTERBLENDERS will be required to deliver 776,057 shares to settle its obligation associated with theseawards.

The Group will also be responsible for the ultimate settlement of the awards that it has committed to issuingunder the 2012 LTIP.

As of the end of fiscal 2012, the number of shares D.E MASTER BLENDERS is obligated to deliver tosettle the awards described above is 1,352,603. This does not reflect awards that D.E MASTER BLENDERS wascommitted to issue under the 2012 LTIP that were not yet granted at the end of fiscal 2012.

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19. BORROWINGS

The Group’s borrowings are summarised in the following table (all amounts in thousands of Euro):

MaturityDate

Currencydenomination

2012 2011

CurrentNon-

Current CurrentNon-

Current

3.60% Series A Senior Notes . . . . . . May 2019 US Dollars € — €186,615 € — € —3.81% Series B Senior Notes . . . . . . May 2020 US Dollars — 96,525 — —4.03% Series C Senior Notes . . . . . . May 2021 US Dollars — 99,743 — —4.20% Series D Senior Notes . . . . . . May 2022 US Dollars — 139,961 — —Debt issuance costs . . . . . . . . . . . . . . Various US Dollars — (1,206) — —Eurobonds . . . . . . . . . . . . . . . . . . . . . March 2012 Euros — — 297,342 —Brazilian real borrowings . . . . . . . . . 2012–2019 Brazilian Real 25,136 — 19,770 7,094Acquisition financing . . . . . . . . . . . . Various Brazilian Real 3,320 7,158 28,707 10,222Other financing . . . . . . . . . . . . . . . . . Various Various — 162 — —

Total borrowings . . . . . . . . . . . . . . . . €28,456 €528,958 €345,819 €17,316

Senior notes—On 15 May 2012, the Group issued $2.1 billion (approximately €1.6 billion) of senior notesto Sara Lee. In connection with the Separation, the Group transferred approximately $1.45 billion (approximately€1.1 billion) of these notes through a non-cash settlement of certain receivables from Sara Lee. The remaining$650 million (approximately €522.8 million) remained outstanding and was transferred by Sara Lee to other thirdparties in settlement of notes issued by Sara Lee with identical terms.

Interest is payable on these notes semi-annually beginning in November 2012 and may be prepaid at anytime on or after 15 May 2017. The Group is required to offer prepayment of all debt securities when a change ofcontrol occurs, at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interest to thedate of prepayment. The notes contain several covenants including: limiting the Group’s ability to consolidate ormerge with another entity, limiting the transfer or lease of substantially all of the Group’s assets and limiting anyother unannounced material change in the group or its members.

Issuance costs of $1.5 million (approximately €1.2 million at the date of issuance) were incurred uponissuance of the notes.

Eurobonds—On 20 March 2010, the Group issued €300 million of bonds guaranteed by Sara Lee, whichwere scheduled to mature in March 2012. The bonds were issued at a fixed rate of 2.25% and were effectivelyconverted into variable rate debt using interest rate swaps. The Eurobonds matured on 30 March 2012 and werefully repaid.

Brazilian real borrowings—The Group uses bank loans to meet short-term working capital needs, whichare generally 8-12 months in duration and have a variable interest rate linked to the interbank borrowing rate. Inaddition, the Group utilises bank loans, which are subsidised under a government regulated program, during theyear that carry an average interest rate of 4.5% – 9.5%.

Acquisition financing—In connection with the acquisition of Café Damasco in fiscal year 2011, the Groupentered into financing arrangements with the sellers under which a portion of the purchase price is paid in futureperiods. In connection with the Café Damasco acquisition, 42.8 million Brazilian Real (approximately€19.1 million at the acquisition date), is payable to the seller ratably over five years. The liability was recorded atfair value of 29.8 million Brazilian Real (approximately €13.3 million) at the date of acquisition based on adiscount rate of 13.9%. The fair value of the obligation is €10.5 million at the end of fiscal 2012 and€14.2 million at the end of fiscal 2011. Approximately €3.3 million of the liability is classified as current debt forfiscal year 2012 and the remainder as noncurrent.

F-52

In connection with the Separation, the Group also entered into the following:

• Bridge loans—On 29 May 2012, the Group entered into two senior unsecured loan agreements withseveral lenders for $1.8 billion each, bearing interest of Libor plus 1.25% per annum. The first loan wasused to fund the special dividend described in Note 1. The proceeds from the second bridge loan wereused to repay the first bridge loan. The second bridge loan was fully repaid using available cash on29 June 2012 within the Group. Issuance fees of $3 million and interest expense of $0.14 million wereincurred in relation to these loans during fiscal year 2012 and were recognised in the income statement.

• Revolving credit facility—On 22 May 2012, the Group entered into a five-year revolving credit facilityin the amount of €750 million to fund short-term working capital requirements. Fees were paid on theestablishment of the facility of €3.6 million. The facility bears interest of Euribor plus 0.85% based onthe Company’s current credit rating and to the extent applicable certain mandatory costs. The facility issubject to a commitment fee on undrawn amounts equal to 35% of the margin based on the Company’sthen applicable credit rating. As at 30 June 2012, the Group has €750 million of undrawn and availablefunds under this facility.

The senior notes and the revolving credit facility have certain restrictive financial covenants which are to becalculated and tested semi-annually. The total net debt must not exceed 3.5 times Adjusted EBITDA. Thecovenant calculations are based on contractually determined calculations based on figures that cannot be directlyreconciled with these financial statements. In addition, the senior notes and the revolving credit facility havebehavioural covenants including financial reporting deadlines, limitations on disposal of assets and otheroperational covenants. The Group has to be in compliance with these covenants as of fiscal year 2013.

20. TRADE AND OTHER PAYABLES

The composition of trade and other payables is as follows (all amounts in thousands of Euro):

2012 2011

Trade payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €282,060 €264,711Accrued payroll and benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102,469 94,342Accrued marketing costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105,040 94,706Non-income taxes payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,612 32,102Deferred income-current (Note 22) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26,034 23,196Bank overdrafts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,061 3,545Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81,267 50,658

€630,543 €563,260

21. INCOME TAXES

The Group’s income tax expense is summarised as follows (all amounts in thousands of Euro):

2012 2011 2010

Current tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 87,104 € 94,775 €134,806Deferred tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,243 15,888 40,053

Income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €127,347 €110,663 €174,859

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The Group’s effective tax rate differs from the amount that would arise using the weighted-average statutorytax rate applicable to profits of the legal entities that comprise the Group as follows:

2012 2011 2010

Tax at weighted-average statutory rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24.2% 23.2% 21.8%Tax exempt and non-taxable income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (10.7)% (7.1)% (9.0)%Non-deductible expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2% 0.3% 0.8%Unrecognised tax losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.7% 3.5% 4.5%Recognition of previously unrecorded tax losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1.6)% — (6.0)%Uncertain tax liabilities and tax audit adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.7% 1.0% 17.8%Recapture and repatriation taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.7% 8.6% 12.3%Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.9% 0.1% —

Effective tax rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49.1% 29.6% 42.2%

The variation in the Group’s effective tax rate during the fiscal years presented is primarily due to specifictax events that occurred in fiscal year 2012 and 2010 that did not occur in fiscal year 2011. The line-items belowprovide an explanation of the significant rate differences between fiscal year 2012 versus fiscal year 2011 andfiscal year 2011 versus fiscal year 2010:

Non-deductible expenses—In fiscal year 2012, the Group incurred non-deductible expenses in certainjurisdictions relating to the identified accounting irregularities (see also Note 1 restatement of prior financialstatements), non-recoverable withholding taxes and costs made associated to loan settlements.

Recognition of previously unrecorded tax losses—The increase in the Group’s fiscal year 2010 effective taxrate were partially offset by the recognition of previously unrecorded deferred tax assets as a consequence ofprofitable operations and revised assessments of the ability to utilise the deferred tax assets in certainjurisdictions.

Uncertain tax liabilities and tax audit adjustments—During fiscal year 2012, the Group recorded an increaseto the uncertain tax liabilities primarily with regard to a tax assessment received in Brazil in fiscal year 2012 (seeNote 28). This increase was offset with releases to the uncertain tax liabilities relating to other jurisdictionsresulting in a net impact to tax expense of €9.6 million. An uncertain tax liability is recognised based on theGroup’s estimate of the amount that is likely to be paid in relation to each individual tax exposure. The uncertaintax liabilities are reassessed each period based on additional facts and modified as appropriate.

In fiscal year 2010, the Group recorded an uncertain tax liability related to a potential tax liability associatedwith operations in Belgium that the Group sold to a third party in 1997. The third party buyer declaredbankruptcy and did not pay an approximate €30 million Belgian tax liability. During fiscal year 2010, as aconsequence of the actions by the Belgian state prosecutor, the Group recorded an uncertain tax liability of€31.7 million related to this liability. During fiscal year 2011, the Group resolved this matter and paid theliability.

The Group’s uncertain tax liabilities were also impacted by a change in uncertain tax liabilities recorded inprior periods. During fiscal year 2010, the Group recorded an increase in previously recorded uncertain taxliabilities of €30.7 million.

Recapture and repatriation taxes—The Group’s tax expense related to recapture and repatriation taxincreased during fiscal year 2012. The Group decided to increase, in the future, the repatriation of available cashand therefore reevaluated its tax liabilities associated with the repatriation of cash. These additional recapturetaxes along with repatriation taxes resulted in income tax expense of €53.7 million during fiscal year 2012.

F-54

The Group’s tax expense related to recapture and repatriation tax was impacted in fiscal year 2010 as theresult of a decision made in the fiscal year to no longer reinvest amounts from certain jurisdictions, whichresulted in the recognition of additional recapture taxes. This was partially offset by a decrease in the estimatedrepatriation taxes due to events which occurred during the period. The net impact of these items on the Group’sincome tax expense was €50.8 million.

Deferred Income Taxes

The analysis of deferred income tax assets and liabilities is as follows (all amounts in thousands of Euro):

2012 2011

Deferred income tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €122,657 €110,838Deferred income tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (78,502) (87,121)

Net deferred income tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 44,155 € 23,717

The movement in total deferred income taxes is as follows (all amounts in thousands of Euro):

2012 2011

Beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 23,717 € 27,216Deferred tax (expense) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (40,243) (15,888)Tax (charge) / credit relating to components of other comprehensive income . . . . . . . . . . . 30,883 11,913Charged directly to equity as a result of a separation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,520 —Acquisition of subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (207)Exchange differences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,722) 683

End of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 44,155 € 23,717

The movement in deferred income tax assets and liabilities during fiscal year 2012, without taking intoconsideration the offsetting of balances within the same tax jurisdiction, is as follows (all amounts in thousandsof Euro):

OpeningBalance

(Charged)Credited

to theIncome

Statement

(Charged)Creditedto Other

ComprehensiveIncome

(Charged)Credited

directly toEquity

BusinessCombination

ExchangeDifferences

ClosingBalance

Deferred income tax assets:Property, plant, and

equipment . . . . . . . . . . € (835) € 18,726 €— € — €— € 168 € 18,059Nondeductible

provisions . . . . . . . . . . 13,696 11,760 — — — (641) 24,815Net operating loss and

other tax carryforwards . . . . . . . . . . . 78,772 (12,264) — (7,388) — (3,545) 55,575

Noncurrent prepaid anddeferred assets . . . . . . — 9,500 — 4,583 — — 14,083

Other . . . . . . . . . . . . . . . 7,019 (951) — 4,335 — (278) 10,125

Total deferred income taxassets . . . . . . . . . . . . . . . . . €98,652 € 26,771 €— € 1,530 €— €(4,296) €122,657

F-55

OpeningBalance

Charged(Credited)

to theIncome

Statement

Charged(Credited)to Other

ComprehensiveIncome

(Charged)Credited

directly toEquity

BusinessCombination

ExchangeDifferences

ClosingBalance

Deferred income taxliabilities:

Goodwill and otherintangibles . . . . . . . . . € 6,729 € 3,964 € — € — €— €(331) €10,362

Recapture of previouslyreported taxbenefits . . . . . . . . . . . . 54,702 29,321 — (27,864) — — 56,159

Retirement benefitobligations . . . . . . . . . (11,351) 49,186 (30,883) 2,804 — 196 9,952

Inventory . . . . . . . . . . . . 15,015 (6,314) — (6,930) — (80) 1,691Other . . . . . . . . . . . . . . . . 9,840 (9,143) — — — (359) 338

Total deferred income taxliabilities . . . . . . . . . . . . . . . € 74,935 €67,014 €(30,883) €(31,990) €— €(574) €78,502

As a result of jurisdictional netting between deferred income tax assets and deferred income tax liabilities,the closing balances show a difference for both the deferred income tax assets and the deferred income taxliabilities for the amount of €31.2 million compared to the amounts reported in the consolidated statements of thefinancial position (see page F-5).

The opening balance of the fiscal year 2012 movement schedules for deferred income tax assets anddeferred income tax liabilities show a difference of €12.2 million with the ending balance of fiscal year 2011.The difference is the result of the transfer of the retirement benefit obligations in fiscal year 2012 from deferredtax assets to deferred tax liabilities, since the category resulted in a deferred tax liability at the end of fiscal year2012.

As described in Note 1 and Note 16, a number of financial impacts resulted from the Separation. One of thetax impacts of the Separation was a net increase to deferred tax assets of €33.5 million due to the differences inthe basis of preparation between the 2011 and 2012 statements of financial position. Of the €33.5 million,€2.8 million relates to net liabilities assumed from Sara Lee in Note 1 and €36.3 million is included in the impactof the conversion for income taxes as explained in Note 16. These adjustments are reflected in the 2012rollforward of deferred tax balances as amounts charged directly to equity.

The movement in deferred income tax assets and liabilities during fiscal year 2011, without taking intoconsideration the offsetting of balances within the same tax jurisdiction, is as follows (all amounts in thousandsof Euro):

OpeningBalance

(Charged)Credited

to theIncome

Statement

(Charged)Creditedto Other

ComprehensiveIncome

BusinessCombination

ExchangeDifferences

ClosingBalance

Deferred income tax assets:Nondeductible provisions . . . . . . . . €17,542 € (4,196) € — €— € 350 € 13,696Net operating loss and other tax

carry forwards . . . . . . . . . . . . . . . 60,417 18,392 — — (37) 78,772Retirement benefit obligations . . . . 8,252 (8,868) 11,913 — 54 11,351Other . . . . . . . . . . . . . . . . . . . . . . . . 8,000 (819) — — (162) 7,019

Total deferred income tax assets . . . . . . . €94,211 € 4,509 €11,913 €— € 205 €110,838

F-56

OpeningBalance

Charged(Credited)

to theIncome

Statement

Charged(Credited)to Other

ComprehensiveIncome

BusinessCombination

ExchangeDifferences

ClosingBalance

Deferred income tax liabilities:Property, plant, and equipment . . . . . € 4,249 € (3,200) €— €— €(214) € 835Goodwill and other intangibles . . . . . 6,830 (101) — — — 6,729Recapture of previously claimed tax

benefits . . . . . . . . . . . . . . . . . . . . . 51,527 3,175 — — — 54,702Inventory . . . . . . . . . . . . . . . . . . . . . . 643 14,693 — — (321) 15,015Other . . . . . . . . . . . . . . . . . . . . . . . . . 3,746 5,830 — 207 57 9,840

Total deferred income tax liabilities . . . . . €66,995 €20,397 €— €207 €(478) €87,121

The tax (charge) credit relating to components of other comprehensive income is as follows (all amounts inthousands of Euro):

2012 2011

BeforeTax

Tax(Charge)

CreditAfterTax

BeforeTax

Tax(Charge)

Credit After Tax

Currency translation adjustments . . . . . . . . . . . € 47,499 € — € 47,499 € (2,225) € — €(2,225)Retirement benefit obligation related items . . . (53,967) 30,883 (23,084) (11,731) 11,913 182

Other comprehensive income (loss) . . . . . . . . . € (6,468) €30,883 € 24,415 €(13,956) €11,913 €(2,043)

These tax amounts are all deferred taxes.

The Group has €728.5 million of tax losses in the jurisdictions in which it operates that are available tooffset future taxable income. These losses expire as follows (amounts in thousands of Euro):

Fiscal year 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 632Fiscal year 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,511Fiscal year 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,888Fiscal year 2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,512Fiscal year 2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,674Fiscal year 2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,602Fiscal year 2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,986Fiscal year 2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,852Fiscal year 2022 and beyond . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,370No expiration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 647,503

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €728,530

The tax effect of these losses was €203.3 million, for which D.E MASTER BLENDERS had recognised€55.6 million as a deferred tax asset as of fiscal year 2012 based on the expectation of future taxable earnings.Please note that the losses as per fiscal year 2012 differ from the losses reported in fiscal years 2011 and 2010 asthese latter years reflected carved out figures from Sara Lee. As such, this deferred tax asset was a reasonablereflection of what would have existed if the expenses reported on those financial statements were actuallyincurred and reported on the prior tax returns filed by the legal entities which comprise the Group.

The Group has total unrecognised deferred income tax assets, including the unrecognised tax losses,described above, and other temporary differences, of €147.7 million and €278.5 million as of fiscal years 2012and 2011, respectively.

F-57

The Group’s tax expense includes €53.7 million, €32.0 million and €50.8 million in fiscal years 2012, 2011and 2010, respectively, related to recapture and repatriation tax liabilities that are expected to be paid whencertain cash balances are repatriated, as well as non-U.S. earnings subject to U.S. tax currently. While a portionof these expenses were incurred historically by Sara Lee, they resulted from the Group’s operations and theGroup is incurring similar expenses through the date of Separation. As such, these expenses have been reflectedin the Group’s financial statements as an allocation of tax expense for the periods presented herein. Aside fromthe amount the Group intends to repatriate the Group intends to continue to reinvest its earnings for theforeseeable future and, therefore, has not recognised tax expense on these earnings.

22. RETIREMENT BENEFIT OBLIGATIONS

The Group operates a number of defined benefit and defined contribution plans for its employees.

Defined Contribution Plans

The Group sponsors defined contribution plans for its employees. The Group’s cost is determined by thecontributions to these plans and is recorded when it becomes due. The amount of expense recognised during thefiscal years 2012, 2011 and 2010 was €3.3 million, €2.6 million and €2.4 million, respectively.

Defined Benefit Plans (Pension and Post-Employment Medical)

The Group sponsors defined benefit plans in several countries, with the most significant plans in theNetherlands and the U.K. The Group’s plans include pension plans and post-employment medical benefit plans.These plans are funded by contributions from the employees and the relevant Group entities, taking into accountapplicable government regulations and the recommendations of independent, qualified actuaries.

The majority of plans have plan assets held in trusts, foundations or similar entities, governed by localregulations and practice in each country. The assets for these plans are generally held in separate trusteeadministered funds. The benefits provided to employees under these plans are based primarily on years of serviceand compensation levels.

A summary of the amounts recognised in the financial statements related to the pension benefit plans andpost-employment medical plans is as follows (all amounts in thousands of Euro):

2012 2011 2010

Asset recorded on the statements of financial position:Defined benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,311,263) (1,888,845) (423)Fair value of plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,526,172 2,059,866 1,055

Defined benefit plans with surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . 214,909 171,021 632Restrictions to defined benefit asset due to the asset ceiling . . . . . . . (64,716) (158,225) —

Defined benefit asset recognised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150,193 12,796 632

Liability recorded on the statements of financial position:Defined benefit obligation of funded plans . . . . . . . . . . . . . . . . . . . . . (256,828) (65,642) (2,122,837)Fair value of plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 190,131 43,540 2,027,566

Funded defined benefit plans with a deficit . . . . . . . . . . . . . . . . . . . . (66,697) (22,102) (95,271)Defined benefit obligation of unfunded plans . . . . . . . . . . . . . . . . . . . (37,252) (4,184) (3,316)

Defined benefit plans with a deficit . . . . . . . . . . . . . . . . . . . . . . . . . . (103,949) (26,286) (98,587)Defined benefit obligation—post-employment medical benefits . . . . (5,512) (5,970) (7,428)

Defined benefit liability recognised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (109,461) (32,256) (106,015)

F-58

The following provides detailed disclosures regarding the pension plans and the post-employment medicalplans.

Pension Benefits—The reconciliation of the amounts recognised in the table above to the total definedbenefit obligation and fair value of plan assets is as follows (all amounts in thousands of Euro):

2012 2011 2010

Defined benefit obligation of plans with a surplus . . . . . . . . . . . . . . . . . . . (2,311,263) (1,888,845) (423)Defined benefit obligation of funded plans with a deficit . . . . . . . . . . . . . . (256,828) (65,642) (2,122,837)Defined benefit obligation of unfunded plans . . . . . . . . . . . . . . . . . . . . . . . (37,252) (4,184) (3,316)

Total defined benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,605,343) (1,958,671) (2,126,576)

Fair value of plan assets of plans with a surplus . . . . . . . . . . . . . . . . . . . . . 2,526,172 2,059,866 1,055Fair value of plan assets of plans with a deficit . . . . . . . . . . . . . . . . . . . . . 190,131 43,540 2,027,566

Total fair value of plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,716,303 2,103,406 2,028,621

Net defined benefit position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110,960 144,735 (97,955)

Of which presented as:Defined benefit plans with a surplus . . . . . . . . . . . . . . . . . . . . . . . . . . 214,909 171,021 632Defined benefit plans with a deficit . . . . . . . . . . . . . . . . . . . . . . . . . . (103,949) (26,286) (98,587)

110,960 144,735 97,955

The movement in the defined benefit obligation over the year is as follows (all amounts in thousands ofEuro):

2012 2011 2010

Defined benefit obligation at the beginning of the period . . . . . . . . . . . . €1,958,671 €2,126,576 €1,712,453Employer service costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,828 19,098 17,615Interest costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115,042 105,082 110,247Plan participants’ contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,213 1,162 1,492Net actuarial (gain) or loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 302,055 (105,702) 349,503Foreign currency translation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115,128 (82,377) 30,080Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (101,915) (91,939) (94,868)Acquisition/business combination/divestiture . . . . . . . . . . . . . . . . . . . . . — (293) (3)Past service costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 352 (13,075) —Impact of Separation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 220,363 — —Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (24,394) 139 57

Defined benefit obligation at the end of the period . . . . . . . . . . . . . . . . . . €2,605,343 €1,958,671 €2,126,576

F-59

The movement in the fair value of plan assets is as follows (all amounts in thousands of Euro):

2012 2011 2010

Fair value of plan assets at the beginning of the period . . . . . . . . . . . . . . €2,103,406 €2,028,621 €1,727,686Employer contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150,391 77,875 82,023Plan participants’ contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,213 1,162 1,492Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (101,915) (91,939) (94,868)Expected return on assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 153,388 132,026 117,982Asset gain or (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155,252 33,730 167,616Foreign currency translation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117,240 (77,624) 27,546Acquisition/business combination/divestiture . . . . . . . . . . . . . . . . . . . . . — (447) (856)Impact of Separation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165,399 — —Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (28,071) 2 —

Fair value of plan assets at current period end . . . . . . . . . . . . . . . . . . . . . €2,716,303 €2,103,406 €2,028,621

The amounts recognised in the income statements are as follows (all amounts in thousands of Euro):

2012 2011 2010

Employer service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 18,828 € 19,098 € 17,615Past service costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 352 (13,075) —Interest costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115,042 105,082 110,247Expected return on assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (153,388) (132,026) (117,982)Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 25 (9)

Total benefit expense (income) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € (19,152) € (20,896) € 9,871

Of the total benefit expense (income), €19.2 million, €6.0 million and €17.6 million of expense isrecognised within operating income and €38.3 million, €26.9 million and €7.7 million of income is recognisedwithin finance income in fiscal years 2012, 2011 and 2010, respectively.

Past service cost recognised in fiscal year 2011 relates to a change in the grant of post-employment benefitsto employees in the Netherlands, primarily modifying indexation and the threshold to participate in the definedbenefit plan.

The amounts recognised in the statements of comprehensive income are as follows (all amounts inthousands of Euro):

2012 2011 2010

Beginning of the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 245,296 € 232,837 € 133,064Actuarial (gains) / losses on the defined benefit obligation . . . . . . . . . . . . . . 302,055 (105,702) 349,503Actuarial (gains) / losses on the plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . (155,252) (33,730) (167,616)Restrictions to defined asset due to the asset ceiling . . . . . . . . . . . . . . . . . . . (97,218) 158,225 (83,781)Foreign currency translation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,938 (6,334) 1,667

End of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 298,819 € 245,296 € 232,837

F-60

The experience adjustments for each year are as follows and relate to the plans included in the statements offinancial position at the end of that year:

2012 2011 2010

Liability (gain) or loss due to experience . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 20,341 € (3,445) € (77,421)Liability (gain) or loss due to assumptions changes . . . . . . . . . . . . . . . . . . . 281,714 (102,257) 426,924

Actuarial (gains) / losses on the defined benefit obligation . . . . . . . . . . . . . . 302,055 (105,702) 349,503Asset (gain) or loss due to experience . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (155,252) (33,730) (167,616)

Actuarial (gain) or loss recognised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 146,803 €(139,432) € 181,887

The weighted-average actual assumptions used in measuring the net periodic benefit costs of the next fiscalyear and plan obligations at the end of the fiscal year are as follows:

2012 2011 2010 2009

Discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.38% 5.61% 5.15% 6.43%Inflation rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.45% 2.67% 2.57% 2.48%Expected return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.70% 6.72% 6.62% 6.71%Future salary increases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.99% 3.09% 3.28% 3.25%

The discount rate is determined by utilising a yield curve based on high-quality, fixed-income investmentsthat have an AA bond rating to discount the expected future benefit payments to plan participants. Salaryincrease assumptions are based upon historical experience and anticipated future management actions.

Assumptions regarding future mortality experience are set based on actuarial advice in accordance withpublished statistics and experience in each territory. Mortality assumptions for the most important countries arebased on the following post-retirement mortality tables:

• U.K.: Self Administrated Pension Schemes mortality tables issued by the Continues MortalityInvestigation committee.

• The Netherlands: Prognoses table 2010-2060 as published by the Dutch Society of Actuaries withTowers Watson 2010 Mortality Experience.

The pension plan asset allocation differs per plan. On a weighted average basis, the allocation was asfollows:

2012 2011 2010 2009

Equity instruments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23.6% 25.6% 24.0% 19.8%Bond instruments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39.3% 37.6% 40.2% 71.5%Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.6% 2.3% 3.5% 3.4%Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35.5% 34.5% 32.3% 5.3%

100% 100% 100% 100%

Investment strategies are based on the composition of the plan liabilities. With the aid of asset liabilitymanagement modeling, analyses are made of possible future economic scenarios and investment portfolios.Based on these analyses, investment strategies are determined for each plan to produce optimal investmentreturns at acceptable funding ratio risk levels. Less favourable years can be part of these scenarios. The strategictargets changed substantially from 2009 since one of the Group’s pension plans in the United Kingdom withsignificant assets is inactive and therefore the plan assets are invested in fixed income securities and cashinstruments only, which are included in “Other” in the table above. Currently the strategic targets for the Group’smain active pension fund are: 30% equity securities (including equity derivatives and forward currencycontracts), 60% debt securities and 10% other investments, cash included. Pension assets do not include anyinvestments in shares of the Group or Sara Lee.

F-61

The expected return on plan assets is determined as a weighted-average rate of return based on the currentand projected investment portfolio mix of each plan, taking into account the corresponding long-term yields forthe separate asset categories, which depend on components such as the risk-free rate of return in real terms,expected inflation and expected risk and liquidity premiums. In addition, actual long-term historical returninformation is taken into account. The actual return on plan assets resulted in gains of €308.6 million,€165.8 million and €285.6 million for fiscal years 2012, 2011 and 2010 respectively.

Expected cash contributions to post-employment benefit plans for fiscal 2013 are €82.1 million. The exactamount of cash contributions made to pension plans in any year is dependent on a number of factors includingminimum funding requirements in the jurisdictions in which the Group operates and arrangements made with thetrustees of plans.

During fiscal year 2006, the Group entered into an agreement with the plan trustee to fund certain U.K.pension obligations by 2015. During fiscal year 2011, we entered into an agreement to fund another section ofthe plan by March 2024. The employer will pay such amounts as are assessed to be needed such that the assetsare sufficient to buy out in full the liabilities of the section as at 31 March 2024. The expected fiscal year 2013contributions shown above reflect the amounts agreed upon for these U.K. plans. Subsequent to 2015, the Grouphas agreed to keep such plans funded in accordance with local funding standards.

Post-Employment Medical Benefits—The Group operates a post-employment medical benefit scheme inthe Netherlands. The method of accounting, assumptions and the frequency of valuations are similar to thoseused for defined benefit pension schemes. This medical plan is an allowance type plan, which provides a fixedamount of benefits, and therefore does not assume any health care cost. The plan is unfunded.

The movement in the defined benefit obligation is as follows (all amounts in thousands of Euro):

2012 2011 2010

Defined benefit obligation at the beginning of the period . . . . . . . . . . . . . . . . . . . . . € 5,970 € 7,428 € 7,414Employer service costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 4 5Interest costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 316 336 446Net actuarial (gain) or loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 443 (728) 1,051Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,217) (1,072) (1,492)Curtailment and past service costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — —Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 2 4

Defined benefit obligation at the end of the period . . . . . . . . . . . . . . . . . . . . . . . . . . € 5,512 € 5,970 € 7,428

The amounts recognised in the income statements are as follows (all amounts in thousands of Euro):

2012 2011 2010

Recognised within operating income:Employer service costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €— € 4 € 5

Recognised within finance income and expense:Interest costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 316 336 446

Total benefit expense or (income) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €316 €340 €451

Expected contributions for the post-employment medical plans for fiscal year 2013 are €1.2 million.

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The cumulative actuarial (gains) and losses recognised in the statements of comprehensive income are asfollows (all amounts in thousands of Euros):

2012 2011 2010

Beginning of the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €(831) €(103) €(1,154)Actuarial (gains) / losses on the defined benefit obligation . . . . . . . . . . . . . . . . . . . . . . . 443 (728) 1,051

End of the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €(388) €(831) € (103)

The weighted-average actual assumptions used in measuring the net periodic benefit costs and planobligations of the post-employee medical benefits are as follows:

2012 2011 2010 2009

Discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.14% 5.71% 4.94% 6.49%Inflation rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.00% 2.00% 2.00% 2.00%Future salary increases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.75% 2.75% 3.00% 3.00%

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23. PROVISIONS

The change in provisions was as follows (all amounts in thousands of Euro):

Restructuring Legal and other Total

Noncurrent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,479 24,881 44,360Current . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,554 7,236 36,791

Carrying amount as of fiscal year 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . 49,033 32,117 81,151Additions charged to income statement . . . . . . . . . . . . . . . . . . . . . . . . . 13,813 1,810 15,623Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (25,278) (1,021) (26,299)Change in estimate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (8,398) 1,138 (7,260)Unwinding of discount and effect of changes in the discount rate . . . . . 808 1,104 1,912Currency translation differences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 753 787 1,539

Carrying amount as of fiscal year 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . € 30,731 €35,935 € 66,666

Noncurrent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,925 27,258 34,183Current . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,806 8,677 32,483

Carrying amount as of fiscal year 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . 30,731 35,935 66,666Additions charged to income statement . . . . . . . . . . . . . . . . . . . . . . . . . 34,936 4,095 39,031Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (18,581) (3,896) (22,477)Change in estimate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (9,771) (316) (10,087)Unwinding of discount and effect of changes in the discount rate . . . . . (529) 442 (87)Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,119 — 2,119Currency translation differences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (46) (1,335) (1,381)

Carrying amount as of fiscal year 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . € 38,859 €34,925 € 73,784

Noncurrent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,300 23,605 33,905Current . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,559 11,320 39,879

Carrying amount as of fiscal year 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . € 38,859 €34,925 € 73,784Additions charged to income statement . . . . . . . . . . . . . . . . . . . . . . . . . 59,689 6,722 66,411Impact of Separation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 812 33,938 34,750Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (56,287) (2,771) (59,058)Change in estimate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,989) 2,086 97Unwinding of discount and effect of changes in the discount rate . . . . . 65 247 312Currency translation differences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 1,741 1,786

Carrying amount as of fiscal year 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . € 41,194 €76,888 €118,082

Noncurrent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 767 51,310 52,077Current . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,427 25,578 66,005

Carrying amount as of fiscal year 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . € 41,194 €76,888 €118,082

Restructuring—During the periods presented, the Group took a number of actions to maximise theefficiency of its operations. These actions included:

• Outsourcing of certain shared service functions, including procurement, financial services andinformation technology;

• Alignment of corporate overhead to its current organisation structure; and

• Optimisation of manufacturing capacity in a response to the global economic downturn. In connectionwith this, the Group modified its manufacturing footprint through the closure of its Denmarkmanufacturing facility and the transfer of this product to the Netherlands.

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The additional restructuring charges in fiscal year 2012 are primarily an indirect result of the Separation.The Group determined there was a need to change its organisational struture to become a successful independentpure coffee and tea company. As a result of this assessement, certain jobs were eliminated and the profiles ofcertain employees were no longer consistent with the profile required for the new organisation, both of whichresulted in additional redundancy payments. Furthermore several lease contracts, specifically global IT relatedcontracts were renegotiated to align with the Group’s current organisational structure.

In connection with these actions, and in order to achieve the associated savings, the Group planned toeliminate the positions of approximately 1,136 employees. Of the 1,136 targeted employees, the contracts of1,039 employees were terminated as of the end of fiscal year 2012. The Group expects that the majority of theremaining provision will be paid out within the next 12 months with certain payments extending out five years.

Legal and other provisions—

2012 2011

Impact of Separation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €33,938 € —Branded Apparel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,224 15,336Employer liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,124 4,922Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,602 14,667

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €76,888 €34,925

Impact of Separation—In connection with the Separation, the Group assumed certain assets and liabilitiesfrom Sara Lee that primarily relate to the disposal of Sara Lee’s household and body care business andinternational bakery business. This primarily represents a legal liability assumed in connection with theSeparation.

Sara Lee agreed to transfer certain trademarks to a buyer of one its disposed business and the licenses werecurrently licensed to a distributor. Under the terms of the licensing arrangement, the distributor has rights to theuse of the trademarks. In the event that Sara Lee was unable to transfer such trademarks to the buyer, it had afinancial obligation to the buyer of the business. Sara Lee had a legal right to demand this trademark be returnedin order to transfer it to the buyer of the business however this has not yet occurred. This became an obligation ofthe Group after Separation.

Based on current estimates and an assessment of probability of payment, the total provision recorded relatedto these items assumed at Separation is €33.9 million. Any future changes in the provisions will impact theGroup’s results of operations and any payments will impact the Group’s cash flows.

Branded Apparel—The provisions related to Branded Apparel represent liabilities that are, and willcontinue to be obligations of the Group post Separation. The provisions include medical claims related to injuriescaused to prior employees as a result of noise induced hearing loss and asbestos exposure, which may result inpayments to those individuals for their related medical expenses. These provisions also include environmentalliabilities. The expense related to these provisions has been recorded in selling, general and administrativeexpenses in the income statements. The employer liability relates primarily to payments that are required to bemade to employees in connection with their terms of employment and based on years of service.

Employer liability—The employer liability relates primarily to payments that are required to be made toemployees in connection with their terms of employment and based on years of service.

Other—A variety of legal reserves including, but not limited to supplier, environmental, employment, andnon-income tax matters.

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24. OTHER NONCURRENT LIABILITIES

The composition of other noncurrent liabilities is as follows (all amounts in thousands of Euro):

2012 2011

Deferred income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €41,740 €47,406Indemnification liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,997 —Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,779 5,224

€73,516 €52,630

Deferred Income—Deferred income relates to the Group’s customer loyalty programmes as furtherdescribed in accounting policies (Note 2). The current portion of this deferred income is included in trade andother payables (Note 20).

Indemnification liability— This represents certain indemnifications that were provided to the buyers ofcertain businesses previously disposed of by Sara Lee. This liability transferred to the Group in connection withthe Separation.

25. SALES

Sales are comprised of the following (all amounts in thousands of Euro):

2012 2011 2010

Product sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €2,558,206 €2,305,527 €2,136,192Green coffee bean sales to third parties . . . . . . . . . . . . . . . 134,368 186,516 78,310Lease revenue of machines and maintenance fees . . . . . . . 88,419 87,553 87,220Other sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,025 13,718 11,641

Total sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €2,795,018 €2,593,314 €2,313,363

26. EXPENSES BY NATURE

The aggregate of cost of sales and selling, general and administrative expenses is specified by nature asfollows (all amounts in thousands of Euro):

2012 2011 2010

Cost of product . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €1,371,317 €1,298,732 €1,000,427Employee benefits expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 430,071 410,383 409,080Advertising and promotion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 142,848 137,618 131,877Depreciation and amortisation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84,582 86,324 83,991Distribution expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75,036 64,529 53,218Repairs, maintenance and utilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57,504 43,360 47,258Selling expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39,414 38,428 37,892Rental and lease costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,152 24,489 27,931Corporate overhead allocation from Sara Lee . . . . . . . . . . . . . . . . . . . . . 23,707 25,372 23,702Impairment charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,303 5,638 —Restructuring and restructuring related expenses . . . . . . . . . . . . . . . . . . . 120,656 32,989 14,503Termination of prior Senseo agreement . . . . . . . . . . . . . . . . . . . . . . . . . . 55,337 — —Other operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 225,380 100,193 141,551

Total expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €2,685,307 €2,268,055 €1,971,430

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Employee benefit expense

2012 2011 2010

Wages and salaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €339,910 €342,123 €333,142Social security charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59,878 54,991 52,362Pension costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,480 8,623 20,015Share-based payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,803 4,646 3,561

Total employee benefit expense . . . . . . . . . . . . . . . . . . . . . . . . . . €430,071 €410,383 €409,080

Employee by geographical area (average number of FTEs)

2012 2011 2010

The Netherlands . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,643 2,485 2,843Outside the Netherlands . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,976 5,023 4,945

Total FTEs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,619 7,508 7,788

Specification audit fees

2012

Audit of the financial statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 4,226Audit related engagements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,535Tax advisory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,407Other non-audit related services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,550

Total audit fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €27,718

Which relate to:PricewaterhouseCoopers Accountants N.V. . . . . . . . . . . . . . . . . . . . . . . 10,648Network of PricewaterhouseCoopers Accountants N.V . . . . . . . . . . . . . 17,070

27. FINANCE INCOME AND COSTS

Finance income consists of the following (all amounts in thousands of Euro):

2012 2011 2010

Pension finance income:Expected return on assets . . . . . . . . . . . . . . . . . . . . . . . . . € 153,388 € 132,026 € 117,982Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (115,358) (105,418) (110,693)

Total pension finance income . . . . . . . . . . . . . . . . . . . . . 38,030 26,608 7,289Interest income on loans to Sara Lee . . . . . . . . . . . . . . . . . . . . 71,810 44,993 34,287Other interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,354 20,243 13,723

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 132,194 € 91,844 € 55,299

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Finance costs consist of the following (all amounts in thousands of Euro):

2012 2011 2010

Interest expense:Bank borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 19,000 € 20,380 € 13,762Unwinding of discount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 246 652 1,912Finance arrangement fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81 — 827Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,467) 10 (2)

Total interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,860 21,042 16,499

Net foreign exchange (gain) loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (42,547) 40,889 (40,225)Change in fair value of foreign currency derivative financial instruments . . . . . 5,642 (15,499) 9,769Change in fair value of fair value hedge derivative financial instruments . . . . . 1,603 1,345 (1,140)Change in fair value of borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (2,347) 429

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €(17,442) € 45,430 €(14,668)

28. COMMITMENTS AND CONTINGENCIES

Commitments—The Group’s commitments consist of the following (all amounts in thousands of Euro):

2012 2011 2010

Purchase commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €144,165 €155,271 € 58,698Operating leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77,422 52,215 55,517Guarantees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,867 24,190 24,087

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €245,454 €231,676 €138,302

Purchase commitments—Purchase commitments primarily consist of commitments related to the purchasesof green coffee.

Operating lease commitments—The Group leases certain facilities, equipment and vehicles underagreements that are classified as operating leases. The building leases have original terms of five years, while theequipment and vehicle leases have terms of generally less than seven years. The future aggregate minimum leasepayments under non-cancellable operating leases are as follows (all amounts in thousands of Euro):

2012 2011 2010

Not later than one year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €18,088 €19,377 €19,447Later than one year and not longer than five years . . . . . . . . . . . . . . . . . . . . . . . . . 35,718 30,755 33,988Later than five years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,616 2,083 2,082

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €77,422 €52,215 €55,517

The Group has recorded expense related to operating leases of €27.5 million, €28.9 million and€29.5 million for the fiscal years ended 2012, 2011 and 2010, respectively.

Guarantees—The Group is party to a variety of agreements under which it may be obligated to indemnify athird-party against losses arising from a breach of representation and covenants related to matters such as title toassets sold, the collectability of receivables, specified environmental matters, lease obligations assumed andcertain tax matters. In each of these circumstances, payment by the Group is conditioned on the other partymaking a claim pursuant to the procedures specified in the contract. These procedures allow the Group tochallenge the other party’s claims. In addition, the Group’s obligations under these agreements may be limited in

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terms of time and/or amount, and in some cases the Group may have recourse against third parties for certainpayments made by the Group. Historically, payments made by the Group under these agreements have not had amaterial effect on the Group’s business, financial condition or results of operations.

The Group has pledged a property to guarantee future payments of early retirement allowances andpayments (see Note 6).

Other guarantees—The Group is currently appealing a Spanish Court decision and has obtained a bankguarantee of €64 million as of the fiscal years ended 2012, 2011 and 2010 as security against all allegations (seeContingencies).

Contingencies—The Group has various contingent liabilities as described below.

• Nestec/Nespresso—In June 2010, Nestec/Nespresso (“Nestlé”) filed a suit against Sara Lee Coffee andTea France (“SLCTF”), a subsidiary of the Group, alleging patent infringement for two of its Europeanpatents related to SLCTF’s use of espresso capsules. Nestlé claims that damages could be as high as€50 million. In January 2011, Nestlé filed suit against Sara Lee/DE N.V., Douwe Egberts Nederland,B.V. and Douwe Egberts Koffie en Kado B.V. in the Netherlands, a subsidiary of the Group, allegingpatent infringements of the same two European patents as in the suit filed against SLCTF. In June2011, Nestlé filed a similar suit against Sara Lee Coffee and Tea Belgium (“SLCTB”). Prior to thissuit, SLCTB had sought to obtain a declaration of non-infringement of the patents involved in theDutch and French proceedings. In addition, in February 2012, Nestlé filed a similar suit against SaraLee Southern Europe, S.L. in Spain, alleging patent infringement of three European patents, trademarkinfringement and certain other unfair competition claims. Management believes that the patents grantedto Nestlé are not being infringed and further believes that the patents are invalid. The Group isvigorously contesting the matter, and accordingly, no provision has been recorded as the liability is notconsidered probable.

• Spanish tax case—In October 2009, the Spanish tax administration upheld a challenge made by itslocal field examination against tax positions taken by the Group’s Spanish subsidiaries. In November2009, the Group filed an appeal against this claim with the Spanish Tax Court. In April 2010, theSpanish Chief Inspector upheld a portion of the claim raised by the Spanish tax authorities. The Groupappealed to the Tribunal Economico Administrativo Central (“TEAC”). At the end of March 2012, theTEAC ruled in favor of the Tax Administration with respect to the audit for fiscal years 2003-2005.The Group continues to dispute the challenge and will continue to have further proceedings with theSpanish tax authorities regarding the issue. At the end of fiscal year 2012, the matter is now at the levelof the National Appellate Court (Audiencia Nacional). In June 2011, the Spanish tax administration’slocal field office examination made similar challenges against tax positions for the years ending July 1,2006 to June 27, 2009 taken by the Group’s Spanish subsidiaries. The Group filed an appeal againstthis claim with the Spanish Tax Court (TEAC). The Group believes it is adequately reserved for thechallenges made by the Spanish tax administration’s local field examination.

• Italian tax case—In August 2011, the Italian Provincial Tax Commission upheld a challenge made byits local field examination against a loss claimed in the fiscal year 2004 tax return of the Group’sItalian subsidiaries. Subsequently fiscal years 2003 and 2005 have also been partially reassessed on netoperating losses as a consequence of the challenge with regard to fiscal year 2004. The Group has filedthe corresponding appeals for all those financial years with litigation being now conducted at the levelof the Italian Regional Tax Commission (2nd Grade tax court). The Group continues to dispute thechallenge and expects to prevail in further proceedings with the Italian tax authorities regarding theissue.

• Brazilian tax case—In the fiscal year 2012 Sara Lee Cafés do Brasil Ltda initiated court proceedings inBrazil to contest a tax assessment which was raised in fiscal year 2012 in relation to fiscal year 2006.The assessment is partially related to the disallowance of goodwill amortisation which Sara Lee Cafés

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do Brasil Ltda successfully litigated in prior years The appeal of this court decision by the Brazilian taxauthorities in early 2010, has not at this point been accepted by the court. In addition to this matter, theBrazilian tax authorities also assessed Sara Lee Cafés do Brasil Ltda on allegedly incorrect documentedreturned sales. The Group believes it is adequately reserved for the challenges made by the Braziliantax authorities.

• Leases—The Group is contingently liable for leases related to certain businesses that were previouslydisposed of by Sara Lee. As of the end of fiscal year 2012, the maximum potential amount of futurepayments the Group could be required to make if all of the current operators default on the rentalagreements is €26.5 million. The minimum annual rents under these leases are €1.7 million in 2013,€0.8 million in 2014, €0.6 million in 2015, €0.7 million in 2016 and €22.7 million in 2017 andthereafter. The Group does not have any provision recorded related to this contingent liability.

• Liabilities assumed in connection with the Separation—In connection with Separation, the Groupassumed certain assets and liabilities from Sara Lee that primarily relate to the disposal of Sara Lee’shousehold and body care business and international bakery business. In connection with these entities,competition authorities in various European countries and the European Commission have initiatedinvestigations into the conduct of consumer product companies. These investigations usually continuefor several years and, if violations are found, may result in substantial fines. No formal charges havebeen brought against the Company concerning the substantive conduct that is the subject of theseinvestigations. The Company’s practice is to comply with all laws and regulations applicable to itsbusiness, including the antitrust laws, and to cooperate with relevant regulatory authorities.

• Potential exposures related to previously disposed businesses and transactions related to theSeparation—In connection with the Separation, the Group has assumed legal responsibility for variouslegal and tax exposures associated with transactions entered into by Sara Lee in prior periods. Theseinclude indemnifications provided to buyers upon the disposition of businesses and the risk taxauthorities may challenge the structure of certain divestments and the positions taken relative to legalentities not divested. To the extent that there is an estimable liability that is probable of payment theGroup has reflected it on its statement of financial position.

29. RELATED-PARTY TRANSACTIONS

A discussed in Note 1, the Group had historically been part of the Sara Lee Corporation and as a result hadentered into a number of transactions with other Sara Lee entities. The Group shared many functions and servicesthat were performed by various members of Sara Lee and costs were allocated across the relevant entities whichhad benefited prior to the Separation. The costs were allocated on the basis that Sara Lee believed was areasonable reflection of the utilisation of each service provided or the benefit received by each Sara Lee entity.The allocated costs, while reasonable, may not necessarily be indicative of the costs that would have beenincurred by the Group if it had performed these functions or received these services as a stand-alone group.

Balances and transactions between entities within the Group, which are related parties, have been eliminatedand are not disclosed in this note.

The Group’s transactions with Sara Lee prior to the Separation, were as follows (all amounts in thousands ofEuro):

2012 2011 2010

Sales to Sara Lee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €10,114 €10,513 €11,332Management fee earned from Sara Lee for research and development . . . . . . . . . . 2,539 5,055 4,190Corporate overhead allocations from Sara Lee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,707 25,372 23,702Share-based payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,214 4,646 3,561Interest income on loans receivable from Sara Lee . . . . . . . . . . . . . . . . . . . . . . . . . 71,810 44,993 34,287

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Sales to Sara Lee—The Group sells certain raw materials and inventory products to Sara Lee. Theseproducts primarily consist of green tea, green coffee and coffee brew equipment for Sara Lee’s North Americanbeverage business. Sales prices are on a cost-plus basis and are reflected in revenue in the income statements.

Research and Development Management Fee—The Group performs certain research and developmentactivities for Sara Lee’s North American beverage business for which it receives payment of a management fee.These fees are included in selling, general and administrative expenses in the income statements.

Corporate Overhead Allocations from Sara Lee—Sara Lee currently performs certain corporate overheadfunctions for the Group and costs associated with these functions have been allocated to the Group and reflectedin the financial statements contained herein. These functions include, but are not limited to, executive oversight,legal, finance, human resources, internal audit, financial reporting, tax planning, and investor relations. Theamounts allocated to the Group are intended to represent the costs of providing these services, and managementbelieves the allocation methods are reasonable. However, the actual cost of obtaining these individual services, ifthe Group were a stand-alone company, could be materially different. The cost of the services provided by SaraLee was determined by allocating a portion of the overall Sara Lee corporate costs to the Group based upon theproportion of the Group’s revenue relative to Sara Lee’s revenue. Corporate overhead allocations from Sara Leeare recorded in selling, general and administrative expenses in the income statements.

Share-based Payments—As discussed in Note 18, the Group’s employees participated in Sara Lee’sstockbased compensation plans prior to the Separation, the costs of which have been allocated to the Group andreflected in cost of sales and selling, general and administrative expenses in the income statements.

Loans Receivable—The Group provided both short- and long-term loans to Sara Lee prior to theSeparation. The loans were generally due within one year and had variable rates of interest tied to publishedindexes such as LIBOR and EURIBOR. These loans were settled prior to Separation.

Parent Guarantees—Sara Lee provided a guarantee for certain banking and treasury transactions enteredinto by the Group. This includes guarantees for borrowing and financial instrument contracts. These guaranteesare no longer in place following the Separation.

The amounts outstanding related to Sara Lee, at the end of fiscal years 2011 and 2010 were as follows (allamounts in thousands of Euro):

2011 2010

Trade and other receivables from Sara Lee . . . . . . . . . . . . . . . . . € 1,572 € 2,287Trade and other payables to Sara Lee . . . . . . . . . . . . . . . . . . . . . 1,120 3,225Interest receivable from Sara Lee . . . . . . . . . . . . . . . . . . . . . . . . 13,786 2,320Loans receivable from Sara Lee . . . . . . . . . . . . . . . . . . . . . . . . . 1,700,999 1,844,652

All amounts were settled in connection with the Separation.

Post Separation Agreements— In connection with the Separation, the Group entered into a number ofagreements with Sara Lee (which on 28 June 2012 changed its name to The Hillshire Brands Company) thatcontinue after Separation. These include the following:

• Transition services agreement—Under this agreement, Sara Lee will provide the Group certaintransitional services for information technology such as application maintenance, applicationdevelopment and infrastructure maintenance services. The agreement will generally provide for a termof up to six months and may then be extended for an additional six months. The agreement alsoprovides for the provision of certain tax support services over the course of up to four years and may beextended after obtaining both parties’ consent.

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• Tax sharing agreement—Sara Lee and DE US, Inc., a subsidiary of the Company entered into anagreement under which Sara Lee indemnified DE US, Inc. against all federal income taxes in theUnited States (“U.S.”), all non-U.S. income taxes attributable to a member of the Sara Lee groupexcluding DE US, Inc., all state and local income taxes in the U.S. relating to the Sara Lee entities andall taxes relating to the Sara Lee group (as it was prior to Separation) after the Separation. DE US, Inc.inturn indemnified Sara Lee for all non-U.S. income taxes attributable to DE US, Inc. or its subsidiariesand all taxes of DE US, Inc. following the Separation.

• Intellectual property Separation agreement—Sara Lee granted the Group a limited, non-exclusivelicense to use certain of its trademarks for a term commencing on the Separation date and ending on1 January 2014. This license will automatically terminate upon any material breach. Sara Lee alsogranted the Group a non-exclusive license to continue to use certain Sara Lee trademarks as part of theGroup’s corporate names until 1 January 2014. With respect to product packaging that includes suchcorporate names, the Group may continue to use such packaging until 31 July 2015.

Senior Management Compensation—The compensation expense recognised for senior management foremployee services is as follows (all amounts in thousands of Euro):

2012 2011 2010

Salaries and other short-term employment benefits . . . . . . . . . . . . . . . . € 5,466 €1,083 €1,336Post-employment benefit premiums . . . . . . . . . . . . . . . . . . . . . . . . . . . 438 156 157Share-based payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,074 830 882Severance payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,673 — —

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €11,651 €2,069 €2,375

As the Group did not operate as a stand-alone public company during the historical periods, the amountspresented above are not indicative of the compensation of senior management in future periods.

Included in the fiscal year 2012 numbers are amounts related to previous management of the internationalcoffee and tea business.

Executive Director

Name

Salaries and othershort-term

employment benefitsPost-employmentbenefit premiums

Share-basedpayments Total

Michiel J. Herkemij . . . . . . . . . . . . . . . €2,207 €102 €1,460 €3,769

Non-Executive Directors

The non-executive directors of the Company did not receive any remuneration in fiscal year 2012 in theircapacity as members of the board of directors.

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30. CASH FLOWS FROM OPERATING ACTIVITIES

The Group’s cash flow from operating activities consists of the following (all amounts in thousands ofEuro):

2012 2011 2010

Profit for the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 132,191 € 263,243 €239,743Adjustments for:

Depreciation, amortisation and impairments . . . . . . . . . . . . . . . . . . . . . . 105,886 91,962 83,991Pension expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,195 6,052 17,611Provision charge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66,509 28,939 8,724Provision for doubtful accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,527 1,378 2,362Provision for inventory write-downs . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,396 3,779 4,670Share of profit from associates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (191) (2,233) (2,702)Finance income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (94,163) (65,236) (48,010)Finance costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,463 20,040 15,788Pension finance income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (38,030) (26,608) (7,289)Loss on disposal of assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,067 10,241 6,849Gain on sale of assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (56) (66) (101)Change in fair value of derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,642 (15,499) 9,769Foreign exchange (gains)/losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (42,547) 40,889 (40,225)Other charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (1,352) (102)Income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127,428 110,663 174,859Changes in operating assets and liabilities:

Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,133 (119,457) (13,004)Trade and other receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (55,112) (63,933) 24,723Receivables from Sara Lee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,453 912 (2,179)Trade and other payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63,883 77,968 12,932Payables to Sara Lee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,693 (2,103) 1,996Derivative financial instruments . . . . . . . . . . . . . . . . . . . . . . . . . . . (15,190) 20,907 (20,741)Pension payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (151,607) (78,947) (83,515)Payments of provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (59,058) (22,478) (26,299)Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (26,059) 2,624 4,996

Net cash provided by operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 102,453 € 281,685 €364,846

31. EVENTS AFTER REPORTING DATE

As discussed in Note 28, the Group became liable for potential claims related to actions that the competitionauthorities have initiated in various European countries and the European Commission into the conduct ofconsumer product companies. On 1 October 2012, the Group received a statement of objections from the BelgianCompetition Authorities regarding alleged anticompetitive behaviour by the former household and body carebusiness of Sara Lee. The Group is currently reviewing the statement of objections and will respond to thestatement of objections as requested by the Belgian Competition Authorities.

In August 2012 our Brazilian subsidiary received a notification from the Federal Tax Authorities in Brazilregarding an investigation by these authorities into green coffee trading activities in the Brazilian market. Thisinvestigation focuses on the legitimacy of the tax credit facilities applied on green coffee trading activities over aperiod from 2006 through 2009. We are currently reviewing the notification and carrying out our owninvestigation. Even if the facts support our position, there can be no assurance that we will prevail if the federaltax authorities of Brazil elect to challenge our position in court. However, based on the information currentlyavailable to the Group, the Group is of the opinion that no liability should be recorded.

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The Association of Securities holders (Vereniging van Effectenbezitters or VEB), a Dutch associationrepresenting interests of investors, has written to us in connection with the accounting irregularities in Brazil. Inits letter, the VEB expresses the view that these irregularities should have been disclosed in the prospectus thatwas published at the time of the Separation from Sara Lee. The VEB alleges that the non-disclosure in theprospectus has harmed certain unnamed shareholders of the Company. The VEB states that it does not excludeinitiating litigation if it cannot reach an amicable arrangement with us on this issue. The VEB has not specifiedthe amount of damages that it is seeking from us. We disagree with the VEB. We believe the prospectus wasprepared in accordance with the required standards of care and that we are not liable for any damages caused.

32. LEGAL ENTITIES

The following table provides an overview of the Group’s principal operating subsidiaries, all of which are100% owned by the Group. In addition, the Group has a 45% non-controlling interest in Kaffehuset Friele A/S,which is treated as an associate.

Name of Subsidiary Country of Incorporation

D.E Coffee & Tea Australia Pty Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . AustraliaSara Lee Australia & NZ Pty Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . AustraliaSara Lee Food & Beverage (Australia) Pty Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . AustraliaSara Lee Foodservice (Australia) Pty. Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . AustraliaSara Lee Holdings (Australia) Pty Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . AustraliaSara Lee Household and Body Care (Australia) Pty Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . AustraliaSL/DE Australia Pty Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . AustraliaSL/DE Holdings (Australia) Pty. Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . AustraliaSL Sub Pty. Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . AustraliaSara Lee Household and Body Care Österreich GmbH . . . . . . . . . . . . . . . . . . . . . . . . . . . . AustriaDE Investments Belgium BVBA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . BelgiumDouwe Egberts Coffee Systems BVBA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . BelgiumDouwe Egberts Operating Service BVBA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . BelgiumSara Lee Coffee & Tea Belgium BVBA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . BelgiumSara Lee Finance Belgium BVBA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . BelgiumSara Lee/DE Immo Belgium BVBA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . BelgiumSara Lee Household and Body Care Belgium BVBA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . BelgiumSara Lee Cafés do Brasil Ltda . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . BrazilExpresso Coffee—Automação de Bebidas Quentes Ltda. . . . . . . . . . . . . . . . . . . . . . . . . . . BrazilNutri-Metrics International (Guangzhou) Ltd. (70%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ChinaSara Lee (China) Trading Co. Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ChinaCaitlin Financial Corporation N.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CuracaoCodef Financial Services C.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CuracaoSara Lee/DE Antilles N.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Curacao

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Name of Subsidiary Country of Incorporation

Sara Lee/DE Finance (Antilles) N.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CuracaoSara Lee/DE Investments (Antilles) N.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CuracaoSara Lee/DE Investments (Cyprus) Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . CyprusSara Lee Czech Republic, s.r.o. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Czech RepublicMerrild Kaffe A.p.S. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . DenmarkSara Lee/DE Nordic Finance K/S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . DenmarkCT Diffusion SAS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . FranceCourtaulds Textiles Holding SAS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . FranceDE France Finance SNC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . FranceDE France Holding SNC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . FranceMaison du Café Coffee Systems France SNC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . FranceMaison du Café France SNC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . FranceSara Lee France Finance SAS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . FranceSara Lee France SNC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . FranceSara Lee/DE France S.A.S. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . FranceCoffenco International GmbH . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GermanySara Lee Coffee & Tea Germany GmbH . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GermanySara Lee Deutschland GmbH . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GermanySara Lee/DE Holding GmbH . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GermanySara Lee Coffee and Tea Hellas SA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GreeceSara Lee Hellas Holdings EPE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . GreeceNutri-Metrics International (Hong Kong) Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Hong KongSara Lee Hong Kong Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Hong KongSara Lee Hungary Zrt. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . HungaryPT Premier Ventures Indonesia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IndonesiaPT Sara Lee Indonesia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IndonesiaPT Sara Lee Trading Indonesia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IndonesiaPT Suria Yozani Indonesia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IndonesiaSara Lee Holdings Italy S.r.l. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ItalySara Lee Household and Body Care Italy SpA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ItalySara Lee Japan Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . JapanSara Lee Baltic, s.i.a. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . LatviaSara Lee Finance Luxembourg S.á.r.l. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . LuxembourgSara Lee Holdings Luxembourg S.á.r.l. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . LuxembourgSara Lee Malaysia Sdn Bhd . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MalaysiaSara Lee South East Asia Sdn Bhd . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MalaysiaSara Lee Mauritius Holding Private Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . MauritiusBaro Bestuursmaatschappij B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsThe Coffee Company B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsCoffeeCompany Holding B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsDefacto B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsDE Export B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsDEMB International B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsDouwe Egberts Coffee Systems Global Network B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsDouwe Egberts Coffee Systems International B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsDouwe Egberts Coffee Systems Nederland B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsDouwe Egberts Coffee Treatment & Supply B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsDouwe Egberts Finance B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsDouwe Egberts Nederland B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsI. Tas Ezn. B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Netherlands

F-75

Name of Subsidiary Country of Incorporation

Koninklijke Douwe Egberts B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsMarander Assurantie Compagnie B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsSara Lee International B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsSara Lee International Holdings B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsSara Lee/DE Global Finance B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsSara Lee/DE Investments B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsDEMB Holding B.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NetherlandsD.E Coffee & Tea New Zealand Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . New ZealandKiwi (Nigeria) Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NigeriaPrima-Sara Lee Coffee and Tea Poland Sp .z.o.o. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . PolandDouwe Egberts (Portugal) Produtos Alimentares Lda . . . . . . . . . . . . . . . . . . . . . . . . . . . . . PortugalSara Lee Rus LLC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Russian FederationSara Lee Singapore Pte Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SingaporeSara Lee Slovakia, s.r.o. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SlovakiaSara Lee Finance Spain S.L. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SpainSara Lee Household and Body Care España S.L. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SpainSara Lee Southern Europe, S.L. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SpainMerrild Coffee Systems AB . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SwedenDecotrade GmbH . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SwitzerlandSara Lee (Thailand) Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ThailandSara Lee Coffee & Tea (Thailand) Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ThailandCourtaulds Textiles (Holdings) Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomCourtaulds Textiles Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomDouwe Egberts Coffee Systems Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomImport Foods Sara Lee Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomKiwi (EA) Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomLinnyshaw Insurance Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomMaster Models Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomNew Way Packaged Products Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomSara Lee Acquisition Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomSara Lee Coffee & Tea UK Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomSara Lee Household & Body Care UK Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomSara Lee UK Finance Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomSara Lee UK Holdings Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomSara Lee UK Pension Trustee Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomSara Lee/DE Holdings Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomSara Lee Investments Unlimited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomTemana International Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United KingdomDE US, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United StatesTea Forté Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United States

* * * * * *

F-76

D.E MASTER BLENDERS 1753 N.V.

COMPANY INCOME STATEMENTFOR THE FISCAL YEAR FROM 27 FEBRUARY TO 30 JUNE 2012(All amounts in thousands of Euro)

Note 2012

SHARE OF PROFIT OF SUBSIDIARIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € —Other expenses after income tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,128)

LOSS FOR THE PERIOD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . €(1,128)

F-77

D.E MASTER BLENDERS 1753 N.V.

COMPANY STATEMENT OF FINANCIAL POSITION AS OFJUNE 2012(All amounts in thousands of Euro)

Before appropriation of profit

Note 2012

ASSETSNONCURRENT ASSETS:

Investments in subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 € 326,322

€ 326,322

CURRENT ASSETS:Trade and other receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 4,770

TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 331,092

SHAREHOLDERS’ EQUITY AND LIABILITIESSHAREHOLDERS’ EQUITY:

Share capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € 71,383Share premium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 418,491Other reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (218,671)Legal reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47,523Loss for the period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,128)

5 € 317,598

NONCURRENT LIABILITIES:Other noncurrent liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 12,933

CURRENT LIABILITIES:Trade and other payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 561

TOTAL SHAREHOLDERS’ EQUITY AND LIABILITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . € 331,092

F-78

D.E MASTER BLENDERS 1753 N.V.NOTES TO THE COMPANY FINANCIAL STATEMENTS

1. BASIS OF PREPARATION

For the principles for the recognition and measurement of assets and liabilities and determination of theresult for its Corporate Financial Statements, D.E MASTER BLENDERS applies the option provided inarticle 2:362 subsection 8 of the Dutch Civil Code. This means that the principles for the recognition andmeasurement of assets and liabilities and determination of the result of the Company Financial Statements of D.EMASTER BLENDERS are the same as those applied for the Consolidated Financial Statements underInternational Financial Reporting Standards (IFRS).

The company’s financial statements are prepared to comply with the requirements of the Dutch Civil Code.There are no material differences between Shareholders’ Equity and net income determined under the DutchCivil Code and that determined in accordance with International Financial Reporting Standards as issued by theInternational Accounting Standards Board. In making this conclusion, the company has accounted for itsinvestments in subsidiaries using the net asset value method of accounting versus the cost method or fair valuemethod.

With regard to the income statement of D.E MASTER BLENDERS, article 2:402 of the Dutch Civil Codehas been applied, allowing a simplified format.

The Company was incorporated on 27 February 2012 and named DE International Holdings B.V. On4 April 2012 the Company’s name changed to D.E MASTER BLENDERS 1753 B.V. and subsequently on21 June 2012 the Company was converted into a limited liability company (an N.V.).

In April 2012 the Company established its Merger Company, a wholly owned subsidiary based in the UnitedStates of America.

To effectuate the Separation a number of transactions were entered into, to separate the international coffeeand tea business of Sara Lee and for the Company to become the parent company of the business. Thesetransactions included the distribution by Sara Lee of all of the outstanding shares of common stock of a whollyowned subsidiary, DE US, Inc. to Sara Lee’s shareholders. Subsequent to the distribution, DE US, Inc., mergedwith the wholly owned subsidiary of D.E MASTER BLENDERS, with DE US, Inc., surviving the merger as awholly owned subsidiary of the Company. To accomplish the merger, 594,859,274 common shares ofD.E MASTER BLENDERS were exchanged for the previously distributed shares of DE US, Inc., received onecommon share of D.E MASTER BLENDERS in respect of each share of Sara Lee common stock.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The investments in subsidiaries are carried at net asset value. As a consequence of the applied principlesstated in the basis of preparation above, initial recognition of investments in subsidiaries already being part of theGroup, takes place at the time of the investments in subsidiaries being contributed into the Company which is atSeparation date. Measurement of these investments at the time of initial recognition is at net asset value, based onthe accounting principles applied and carrying amounts in the consolidated financial statements.

The reconciliation between Group equity and Shareholders’ equity of D.E MASTER BLENDERS isexplained in Note 16 of the Group accounts.

F-79

3. INVESTMENT IN SUBSIDIARIES

The movements of the investment in subsidiaries are as follows (all amounts in thousands of Euro):

Total

Fiscal year ended 2012Opening net book amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . € —Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,641Contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 313,681

Closing net book amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 326,322

Additions—represent the acquisition of CoffeeCompany and the incorporation of D.E MASTER BLENDERSInternational B.V.

Contribution—this entirely relates to the contribution of the international coffee and tea business of thenSara Lee into the Company in connection with the Separation of Sara Lee. The investment in group companiescontains the acquisition of DE US, Inc. through a contribution in kind on issued share capital of the Company atthe separation date. The contribution of loans due from group companies reflect the issuance of preferred sharesby DEMB Holding B.V. and DEMB International B.V.

Included in the balance as at the end of the period are loans due from Group companies for an amount of€55.6 million. These include an investment in preferred shares for an amount of €49.5 million with a coupon rateof 7.25% and an amount of €1.0 million with a coupon rate of 7.0%. The remaining loan from Group companiesof €5.1 million bears an interest rate of the applicable Euribor + 0.25% and is due within 1 year.

4. TRADE AND OTHER RECEIVABLES

The composition of trade and other receivables is as follows (all amounts in thousands of Euro):

2012

Prepaid assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,443Amounts due from Group companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . 951Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 376

€4,770

All trade and other receivables are due within one year.

5. SHAREHOLDERS’ EQUITY

The movements of the shareholders’ equity are as follows (all amounts in thousands of Euro):

ShareCapital

Sharepremium

Otherreserves

Legalreserves

Loss forthe year Total

Fiscal year ended 2012Issued share capital—A-shares . . . . . . . . 45 — — — — 45Cancellation—A-shares . . . . . . . . . . . . . (45) 45 — — — —Result for the period . . . . . . . . . . . . . . . . — — — — (1,128) (1,128)Cash contributions . . . . . . . . . . . . . . . . . — 5,000 — — — 5,000Contribution . . . . . . . . . . . . . . . . . . . . . . 71,383 413,446 (218,671) 47,523 — 313,681

Closing net book amount . . . . . . . . . . . . €71,383 €418,491 €(218,671) €47,523 €(1,128) €317,598

F-80

The Company was incorporated on 27 February 2012 with an issued and paid up capital of €45,000 dividedinto 325,000 A-Shares of €0.12 each. On 28 June the Company issued 594,859,274 ordinary shares of €0.12 eachfor a total of €71,383,112.88. The shares were paid up by the contribution in kind of all shares of DE US, Inc.Subsequently to the issuance of the ordinary shares, the A-shares were cancelled without transfer of cash.

The share premium reserves entirely relates to the contribution in kind of all shares of DE US, Inc.

Prior to the Separation, when DE International Holdings B.V. was the parent of the Company, it made cashcontributions of €5 million in total, which was accounted for as share premium.

The other reserves consist of retirement benefit obligation related items that were contributed.

The legal reserves consist of the cumulative translation adjustment incurred by DE US, Inc. prior to thetransfer of the shares to D.E MASTER BLENDERS 1753 N.V.

6. NON CURRENT LIABILITIES

The noncurrent liabilities entirely consist of amounts due to other Group companies. The interest rate is theapplicable Euribor + 0.25%. Repayment is due later than 1 year but not later than 5 years.

7. TRADE AND OTHER PAYABLES

The composition of trade and other payables is as follows (all amounts in thousands of Euro):

2012

Amounts due to Group companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18Other accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 543

€561

All trade and other payables are due within one year.

8. COMMITMENTS AND CONTINGENCIES

In accordance with article 2:403 of the Dutch Civil Code, the Company has assumed joint and severalliability undertakings for any liability arising from the legal acts of certain subsidiaries by means of declarationsfiled with the Trade Register of the Chamber of Commerce, effective 29 June 2012. These subsidiaries consist ofall Dutch Legal subsidiaries listed in Note 32. The Company has also assumed joint and several liabilityundertakings and potential exposures on the basis of the Master Separation Agreement.

Remuneration of the auditors

For details of the remuneration of the auditors reference is made to Note 29 of the Group financialstatements.

Investment in subsidiaries—for the list of direct and indirect investment in subsidiaries, we refer to Note32 of the Group financial statements.

Employee information—during 2012 the Company did not employ any employees.

F-81

OTHER INFORMATION

Profit appropriation

Articles of association provisions governing the distribution of profit:

Article 32 of the articles of association states the following:

32.1 The Company may make distributions on shares only to the extent that its shareholders’ equity exceedsthe sum of the paid-up and called-up part of the capital and the reserves which must be maintained by law.

32.2 Distributions of profit, meaning the net earnings after taxes shown by the adopted annual accounts,shall be made after the determining of the annual accounts from which it appears that they are justified,entirely without prejudice to any of the other provisions of the articles of association.

32.3 The profit, is any, shall be carried to reserve as the Board may deem necessary.

32.4 The profit remaining after application of the previous paragraph shall be at the disposal of the GeneralMeeting, which may resolve to carry it to reserve or to distribute it among the holders of shares.

32.5 On a proposal of the Board, the General Meeting may resolve to distribute to the holders of shares adividend in the form of shares in the capital of the Company.

32.6 Subject to the other provisions of this article the General Meeting may, on a proposal made by theBoard, resolve to make distributions to the holders of shares one (1) or several reserves which the Companyis not prohibited from distributing by virtue of the law.

32.7 No dividends shall be paid to the Company on shares held by the Company or where the Companyholds the depositary receipts issued for such shares, unless such shares or depositary receipts areencumbered with a right of usufruct of pledge.

Distribution of profit:

The board of directors of the Company proposes to add the net loss for the year 2012 to accumulated deficit.

Subsequent events:

For subsequent events, see Note 30 of the Group financial statement.

Report of Independent Registered Public Accounting Firm

To: the General Meeting of Shareholders of D.E MASTER BLENDERS 1753 N.V.:

Report on the financial statements

We have audited the accompanying financial statements for the financial year ended 30 June 2012 ofD.E MASTER BLENDERS 1753 N.V., Joure, as set out on pages F-3 through F-81. The financial statementsinclude the consolidated financial statements and the company financial statements. The consolidated financialstatements comprise the consolidated statement of financial position as at 30 June 2012, the consolidated incomestatement, the consolidated statements of comprehensive income, changes in equity and cash flows for the yearthen ended and the notes, comprising a summary of significant accounting policies and other explanatoryinformation. The company financial statements comprise the company statement of financial position as at30 June 2012, the company income statement for the year then ended and the notes, comprising a summary ofaccounting policies and other explanatory information.

Board of directors’ responsibility

The board of directors is responsible for the preparation and fair presentation of these financial statements inaccordance with International Financial Reporting Standards as issued by the International Accounting StandardsBoard and as adopted by the European Union and with Part 9 of Book 2 of the Dutch Civil Code, and for thepreparation of the directors’ report in accordance with Part 9 of Book 2 of the Dutch Civil Code. Furthermore,the board of directors is responsible for such internal control as it determines is necessary to enable thepreparation of the financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted ouraudit in accordance with Dutch law, including the Dutch Standards on Auditing and in accordance with thestandards of the Public Company Accounting Oversight Board (United States). This requires that we complywith ethical requirements and plan and perform the audit to obtain reasonable assurance about whether thefinancial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in thefinancial statements. The procedures selected depend on the auditor’s judgment, including the assessment of therisks of material misstatement of the financial statements, whether due to fraud or error. In making those riskassessments, the auditor considers internal control relevant to the company’s preparation and fair presentation ofthe financial statements in order to design audit procedures that are appropriate in the circumstances, but not forthe purpose of expressing an opinion on the effectiveness of the company’s internal control. An audit alsoincludes evaluating the appropriateness of accounting policies used and the reasonableness of accountingestimates made by the board of directors, as well as evaluating the overall presentation of the financialstatements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our auditopinion.

Opinion with respect to the consolidated financial statements

In our opinion, the consolidated financial statements present fairly the financial position of D.E MASTERBLENDERS 1753 N.V. as at 30 June 2012, and of its result and its cash flows for the year then ended inaccordance with International Financial Reporting Standards as issued by the International Accounting StandardsBoard and as adopted by the European Union and with Part 9 of Book 2 of the Dutch Civil Code.

Opinion with respect to the company financial statements

In our opinion, the company financial statements present fairly the financial position of D.E MASTERBLENDERS 1753 N.V. as at 30 June 2012, and of its result for the year then ended in accordance with Part 9 ofBook 2 of the Dutch Civil Code.

Emphasis of matters

Basis of preparation

As discussed in Note 1, D.E MASTER BLENDERS 1753 N.V. did not operate as an entity separate fromSara Lee Corporation through 28 June 2012. Therefore, the financial statements may not necessarily be indicativeof results that would have occurred had D.E MASTER BLENDERS 1753 N.V. been a separate stand-alone entityin that period.

Restatement comparative figures

As discussed in Note 1 to the consolidated financial statements, the Company restated its comparative figures forthe financial year ended 2 July 2011 and 3 July 2010 to correct for errors.

Our opinion is not qualified in respect of these matters.

Report on other legal and regulatory requirements

Pursuant to the legal requirement under Section 2: 393 sub 5 at e and f of the Dutch Civil Code, we have nodeficiencies to report as a result of our examination whether the directors’ report, as set out on and referenced inpages II-1 through II-8, to the extent we can assess, has been prepared in accordance with Part 9 of Book 2 of thisCode, and whether the information as required under Section 2: 392 sub 1 at b-h has been annexed. Further wereport that the directors’ report, to the extent we can assess, is consistent with the financial statements as requiredby Section 2: 391 sub 4 of the Dutch Civil Code.

Amsterdam, 11 October 2012PricewaterhouseCoopers Accountants N.V.

Original has been signed by Huub C. Wüst RA

Page 2 of 2

PART IV

ANNUAL REPORT IN ACCORDANCE WITH DUTCH LAW

FOR THE FINANCIAL YEAR ENDED JUNE 30, 2012

This is the Dutch law annual report of D.E MASTER BLENDERS 1753 N.V. (“D.E MASTERBLENDERS” or the “Company”) for its first financial year which started on February 27, 2012 and ended onJune 30, 2012. D.E MASTER BLENDERS was part of the Sara Lee Corporation (now Hillshire Brands).

CHAPTER 1. REPORT OF THE BOARD OF DIRECTORS

1.1 Introduction

This Report of the board of directors of D.E MASTER BLENDERS contains the information which isrequired to be included in a Dutch law annual report pursuant to Book 2 of the Dutch Civil Code, the DecreeArticle 10 Takeover Directive and the Dutch Corporate Governance Code. Where the information is alreadyincluded in the Annual Report on Form 20-F, we refer to the Annual Report on Form 20-F without repeating theinformation in full.

1.2 History and development of the Company

Reference is made to Item 4-4A, pages 28-34 of the Annual Report on Form 20-F.

1.3 Business Overview

Reference is made to Item 4-4B, pages 34-46 of the Annual Report on Form 20-F.

1.4 Risk factors and risk management

Reference is made to Item 3-3D, pages 7- 27 of the Annual Report on Form 20-F and to Item 18, pagesF-26–F-30 of the Financial statements on Form 20-F.

1.5 Capital resources

Reference is made to Item 5, page 65-68 of the Annual Report Form 20-F.

1.6 Employment

Reference is made to Item 6, paragraph “Employees”, page 88 of the Annual Report Form 20-F.

1.7 Research & development

Reference is made to Item 5, page 71 of the Annual Report on Form 20-F.

2 Governance

2.1 The Dutch Corporate Governance Code

The Dutch Corporate Governance Code, as revised, became effective on January 1, 2009. It applies to allDutch companies listed on a government-recognized stock exchange, whether in the Netherlands or elsewhere.The Dutch Corporate Governance Code is based on a “comply or explain” principle. Accordingly, companies are

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required to disclose in their annual reports filed in the Netherlands whether or not they comply with the variousrules of the Dutch Corporate Governance Code. If they do not apply those provisions, they must state the reasonsfor such non-compliance. The Dutch Corporate Governance Code contains principles and best practiceprovisions for the board of directors (executives and non-executives), shareholders and general meetings ofshareholders, financial reporting, auditors, disclosure, compliance and enforcement standards.

We acknowledge the importance of good corporate governance. We have reviewed the Dutch CorporateGovernance Code and support the best practice provisions thereof. Therefore, except as noted below or in thecase of any future deviation, subject to explanation at such time, we intend to comply with the applicable bestpractice provisions of the Dutch Corporate Governance Code.

This annual report addresses our corporate governance structure and states to what extent we apply theprovisions of the Dutch Corporate Governance Code. We hereby disclose the information we are required todisclose as a result of the governmental decree on corporate governance. Our board of directors is of the opinionthat the principles and best practice provisions of the Dutch Corporate Governance Code that are addressed to theboard of directors, interpreted and implemented in line with the best practices followed by the Company, arebeing applied. Deviations from aspects of the corporate governance structure are disclosed in paragraph 2.6 ofthis annual report.

Substantial future changes in the Company’s corporate governance structure and in the Company’scompliance with the Dutch Corporate Governance Code must be submitted to the general meeting ofshareholders for discussion under a separate agenda item.

Pursuant to the Governmental Decree of December 23, 2004 (as most recently amended on December 10,2009), the Company must publish a statement on corporate governance. This statement must report oncompliance with the Dutch Corporate Governance Code. Furthermore, a description must be included with themain characteristics of the internal risk management and control systems connected with the Company’sfinancial reporting process. The corporate governance statement must also provide information on thefunctioning of the general meeting of shareholders including its main rights, the composition of the board ofdirectors including its committees and the information which must be disclosed pursuant to the Decree Article 10Takeover Directive. The board of directors confirms that the information required by the Governmental Decreeof December 23, 2004 (as lastly amended on December 10, 2009) is included in this “Corporate Governance”chapter and chapter 4.2 of this annual report.

The full text of the Dutch Corporate Governance Code can be found onhttps://www.commissiecorporategovernance.nl.

2.2 The board of directors

Reference is made to Item 6, pages 72-74 of the Annual Report on Form 20-F, paragraphs “Introduction”and “Board of Directors”.

Reference is made to Item 6, pages 75-81 of the Annual Report on Form 20-F, paragraph “Board Powersand Function” up to and including paragraph “Conflict-of-Interest Transactions.”

Reference is made to Item 8A, paragraph “Dividend policy”, pages 99-100 of the Annual Report on Form20-F.

2.3 Compensation

Reference is made to Item 6 of the Annual Report on Form 20-F, paragraphs “Remuneration”,“Shareholdings by directors and senior management” pages 81-84 and pages 88-91 and Item 4 of the AnnualReport on Form 20-F “Treatment of Equity-Based Compensation in Separation” pages 31-32.

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Our remuneration report, which has been prepared by our remuneration committee, will be published on ourwebsite: www.demasterblenders1753.com. In this report you will find the remuneration policy and theremuneration details of our board of directors.

2.4 Risk management approach

For a description of the main risks related to the Company’s strategy, reference is made to Item 3-3D,pages 7- 27 of the Annual Report on Form 20-F.

For a description of the design and effectiveness of the internal risk management and control systems,reference is made to Item 5 pages 69-71 of the Annual Report on Form 20 and to Item 18, pages F-26-F30 of theFinancial statements on Form 20-F.

We provide clarity on and limit risk appetite through our strategy, code of conduct and other internalregulations. In the current financial year, our board of directors will thoroughly review current risk appetiteguidelines to verify whether any changes are mandated.

For a description of any major failings of and significant changes to the internal risk management andcontrol systems, reference is made to Item 15, pages 123-124 of the Annual Report on Form 20.

In accordance with best practice provision III.1.8, the board of directors has discussed the corporate strategyand the main risks of the business, the result of the assessment by the board of directors of the design andeffectiveness of the internal risk management and control systems, as well as any significant changes thereto. Weare committed to further analyse and discuss possible improvements to our internal risk management and controlsystems.

2.5 General meeting of shareholders

Reference is made to Item 10B, pages 105-107 of the Annual Report on Form 20-F, paragraphs “GeneralMeetings of Shareholders and Voting Rights” up to and including paragraph “Dissolution and Liquidation”.

Reference is made to Item 10B, page 105 of the Annual Report on Form 20-F, paragraph “Dividends andDistributions”.

2.6 Compliance with the Dutch Corporate Governance Code

We deviate from two provisions in the Dutch Corporate Governance.

Best practice provision II.1.5 prescribes that the board of directors declares regarding the financial reportingrisks in the annual report that the internal risk management and control systems provide a reasonable assurancethat the financial reporting does not contain any errors of material importance and that the risk management andcontrol systems worked properly in the year under review. In connection with the accounting irregularities andcertain other errors in Brazil, the board of directors cannot give such statement unconditionally.

Best practice provision II.2.8 states that remuneration in the event of dismissal of a member of the board ofdirectors may not exceed one year’s salary (the “fixed” remuneration component). It is our policy to set the levelof severance pay for our members of the board of directors at no more than one year’s salary, unless the board ofdirectors, at the proposal of the remuneration committee, finds this manifestly unreasonable given thecircumstances or unless dictated otherwise by applicable law. Considering our Chief Executive Officer’s (the“Chief Executive Officer”) severance entitlements prior to his engagement with our Company, we agreed togrant him a severance payment of 18 months under certain circumstances, including upon expiration of the termof his management service agreement. In addition, our Chief Executive Officer will be entitled to 2.5 times his

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base, bonus and pension compensation if his management services agreement terminates for certain reasonsfollowing a change in control and following a regular notice period. This is laid down in the addendum toMr. Herkemij’s management services agreement and in line with the provisions of the Sara Lee Change inControl Plan and we consider it manifestly unreasonable to take these entitlements away from him. It has beenagreed with our Chief Executive Officer that if his management services agreement is renewed after four yearshis entitlement to severance in the event of a change in control will be reduced to one year base salary.

2.7 Report on the functioning of the committees

While retaining overall responsibilities, our board of directors has assigned certain of its responsibilities topermanent committees consisting of directors, and—in relation to the sustainability committee—seniormanagement, appointed by our Chief Executive Officer. On June 28, 2012, our board of directors has establishedan audit committee, a remuneration committee, a nomination committee and a sustainability committee, each ofwhich has the responsibilities and composition described below. These committees were established during thelast days of the financial year. The audit and remuneration committees met once during the reporting period. Thecommittees did not have the possibility to meaningfully evaluate its and its members’ functioning.

2.7.1 Audit committee

Reference is made to Item 6, paragraph “Audit committee”, pages 79-80 of the Annual Report on Form20-F. The audit committee was installed on June 28, 2012. From its instalment until June 30, 2012, the auditcommittee met once to discuss the planning for the fiscal year 2013.

2.7.2 Remuneration committee

Reference is made to Item 6, paragraph “Remuneration committee”, page 80 of the Annual Report on Form20-F. The remuneration committee was installed on June 28, 2012. From its instalment until June 30, 2012, theremuneration committee met once. Based on the remuneration policy, which was adopted by the general meetingof shareholders on June 25, 2012, the remuneration committee endorsed the remuneration packages for theindividual members of the board of directors for financial year 2012 as these were established by the Sara LeeBoard and Compensation Committee. The remuneration committee prepared the 2012 remuneration report. Thisreport contains a section describing amongst others how the 2012 remuneration policy was implemented in 2012.

2.7.3 Nomination committee

Reference is made to Item 6, paragraph “Nomination committee”, page 80 of the Annual Report onForm 20-F.

2.7.4 Sustainability committee

Reference is made to Item 6, paragraph “Sustainability committee”, page 80 of the Annual Report onForm 20-F.

3 Required information by the Decree Article 10 Takeover Directive

3.1 Introduction

The EU Takeover Directive requires that a listed company discloses certain additional information ondefensive structures and mechanisms which they apply. This requirement has been implemented into Dutch lawby means of a decree of April 5, 2012. Pursuant to this decree, Dutch companies whose securities have beenadmitted to trading on a regulated market have to include certain information in their annual report which couldbe of importance for persons who are considering acquiring a stake in the Company.

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The disclosure must cover the following subjects:

• the capital structure of the Company (paragraph 3.2 below);

• any restriction by the Company on the transfer of shares in the share capital of the Company ordepositary receipts issued for shares with the cooperation of the Company (paragraph 3.3 below);

• holdings in the Company that are subject to a disclosure obligation pursuant to the Act on thesupervision of financial markets (Wet op het financieel toezicht, the “FMSA”) (paragraph 3.4 below);

• any special rights of control attached to shares and the name of the party entitled thereto (paragraph 3.5below);

• the mechanism for verifying compliance with a scheme allowing employees to subscribe for or toacquire shares in the capital of the Company or a subsidiary if the employees do not arrange for suchverification directly (paragraph 3.6 below);

• any restriction on voting rights, the periods for exercising voting rights and the issue of depositaryreceipts for shares with the cooperation of the Company (paragraph 3.7 below);

• any agreement with a shareholder insofar as the Company is aware thereof which may give rise to arestriction on the transfer of shares or of depositary receipts issued for shares with the cooperation ofthe Company or to a restriction on voting rights (paragraph 3.8 below);

• the provisions with regard to the appointment and dismissal of members of the board of directors andthe amendment of the articles of association (paragraph 3.9 below);

• the powers of the board of directors, in particular in respect of the issue of shares of the Company andthe acquisition by the Company of its own shares (paragraph 3.10 below);

• important contracts to which the Company is a party and which are entered into, amended or set asideconditional upon a change of control over the Company after a public offer within the meaning ofarticle 5:70 FMSA and the consequences of such contracts, unless the contracts and the consequencesare of such a nature that the Company would be seriously prejudiced by disclosure of such information(paragraph 3.11 below); and

• any agreement of the Company with a director or employee providing for a distribution on terminationof employment as a result of a public offer within the meaning of article 5:70 FMSA (paragraph 3.11below).

3.2 Capital structure

Reference is made to Item 10B, page 102 of the Annual Report on Form 20-F, paragraph “Share Capital”.

594,859,274 ordinary shares of €0.12 are outstanding and fully paid in.

Dutch law permits us to adopt protective measures against takeovers. Although we have not and do notenvisage to adopt any specific takeover measures, our board of directors has been designated from June, 21, 2012until the first day of July, 1, 2014, to issue shares and grant rights to subscribe for shares in the form of commonshares, up to 10% of the issued share capital as it will read from time to time plus an additional 10% of the issuedshare capital as it will read from to time in connection with or on the occasion of mergers and acquisitions.

3.3 Restrictions on transfer of shares

There are currently no limitations, either under Dutch law or in the articles of association of the Company,on the transfer of shares in our share capital.

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3.4 Reporting obligations pursuant to the FSMA

Holders of our shares may be subject to reporting obligations pursuant to the FSMA. The disclosureobligations pursuant to the FSMA apply to any person or entity that acquires, holds or disposes of an interest inthe voting rights and/or the capital of a public limited company incorporated under Dutch law whose shares areadmitted to trading on a regulated market within the European Union. Disclosure is required when the percentageof voting rights or capital interest of a person or an entity reaches, exceeds or falls below 5, 10, 15, 20, 25, 30, 40,50, 60, 75 or 95 percent (as a result of an acquisition or disposal by such person, or as a result of a change in ourtotal number of voting rights or capital issued). With respect to the Company, the FSMA would require anyperson or entity whose interest in the voting rights and/or capital of the Company reached, exceeded or fell belowthose percentage interests to notify the Authority for the Financial Markets in the Netherlands (AutoriteitFinanciele Markten (“AFM”)) immediately.

A legislative proposal is currently under discussion in Dutch Parliament, pursuant to which the 5 percentthreshold will be replaced by a 3 percent threshold. The proposal would also introduce a mechanism pursuant towhich the Company would be able to identify, and communicate with, beneficial holders of its shares through therespective custodians.

For the information regarding notifications of voting rights or capital interest above 5 percent that weremade pursuant to the FSMA reference is made to Item 7A, page 92 of the Annual Report on Form-20F.

3.5 Special rights of control

There are no special rights of control attached to the issued shares in our share capital.

3.6 Employees’ shares mechanism

We implemented a long term incentive share plan (the “2012 Long-Term Share Incentive Plan”). Thepurpose of the 2012 Long-Term Share Incentive Plan is to motivate and reward selected employees for achievinglong-term financial results that are aligned with our shareholders’ interests and for their continued commitmentto the Company. Our Chief Executive Officer, the members of our executive committee and potentially other keyemployees designated by our remuneration committee are eligible to participate in the 2012 Long-Term ShareIncentive Plan. The remuneration committee determines the exact number of performance share units earned byeach employee, in accordance with the provisions of the 2012 Long-Term Share Incentive Plan, as set out inItem 6, pages 85-87 of the Annual Report on Form 20-F paragraph “2012 Long-Term Incentive Share Plan”.

The shares required for the 2012 Long-Term Share Incentive Plan will be acquired or issued by theCompany.

The board of directors is authorized to acquire shares in its own share capital for the purpose of transferringby virtue of the 2012 Long-Term Share Incentive Plan, to the extent such shares are granted to employees of theCompany. To the extent such shares are not granted to employees of the Company, the board of directors isauthorized to acquire shares in its own share capital with the authorization of the general meeting of shareholdersof the Company. The general meeting of shareholders authorized the board of directors to acquire its own sharesthrough purchase on stock exchange or otherwise for a term of eighteen months as of June 28, 2012, so up to andincluding December 27, 2013. Such authorization relates to the maximum authorized by the articles ofassociation of the Company at a share price of at least the nominal value of the shares and at a maximum shareprice equal to the quoted ordinary share price plus 10%.

On June 25, 2012 the general meeting of shareholders of the Company authorized the board of directors toissue shares, grant rights to subscribe for shares and exclude pre-emptive rights in connection with such issue orto transfer shares of the Company in its own capital under the 2012 Long-Term Share Incentive Plan to thepersons entitled thereto. Grants of shares pursuant to the 2012 Long-Term Share Incentive Plan can be settled bytransferring shares the Company holds in its own share capital.

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3.7 Limitation voting rights on shares

There are currently no limitations, either under Dutch law or in our articles of association, to hold or voteordinary shares.

3.8 Agreements with shareholders on restriction of transfer or voting rights

There are no agreements in place between us and shareholders which may give rise to a restriction on thetransfer of shares or to a restriction on voting rights.

3.9 Appointment of the board of directors and amendment of the articles of association

Reference is made to Item 6, page 76 of the Annual Report on Form 20-F, paragraph “Appointment ofDirectors”.

Reference is made to Item 10B, page 106 of the Annual Report on Form 20-F, paragraph “Amendment ofour Articles of Association.”

3.10 Powers of the board of directors

Reference is made to Item 10B, page 103 of the Annual Report on Form 20-F, paragraph “Issue of OrdinaryShares”, page 104 of the Annual Report on Form 20-F, paragraph “Acquisition of Ordinary Shares” and Item 6,pages 75-76, paragraph “Board Powers and Function”.

3.11 Important contracts or agreements in the context of a public offer

There are no contracts in place to which we are a party and which are entered into, amended or set asideconditional upon a change in control over the Company after a public offer.

As also set out in paragraph 2.6 of this annual report, the Chief Executive Officer will be eligible for aseverance payment consisting of two-and-a-half (2.5) times the ‘base, bonus and pension compensation’ inaddition to a six (6) month notice period if the Chief Executive Officer terminates his management servicesagreement within three months, or if the Company gives notice of termination of the management servicesagreement, provided that such notice is not solely or principally due to the acts or omissions of the ChiefExecutive Officer, following a “change in control”. For the members of our executive committee severancefollowing a change in control is 100% of base pay in addition to a six (6) month notice period.

The rules of the 2012 Long-Term Incentive Share Plan include provisions that allow for awards to vestfollowing a change in control subject to any performance measures being met and pro-rated for the time elapsedsince the grant (although the remuneration committee has the discretion not to apply the pro rata time-basedvesting). On August 21, 2012, the remuneration committee approved that the pro rata time-based vesting will notapply in case of a change in control for the grants awarded in financial and calendar year 2012. Instead, there willbe 100% time-based vesting, i.e. the number of earned performance share units is equal to the number of awardedperformance shares units. The performance conditions based on relative total shareholder return performance ascompared to the comparator group will continue to apply and will determine which number of PSUs, if any, willvest in case of a change in control.

4. Board of directors’ responsibility statements

4.1. Board of directors’ statement

The board of directors hereby declares that, to the best of its knowledge, the Company’s financial statementsprepared in accordance with IFRS and Title 9 Book 2 of the Dutch Civil Code provide a true and fair view of theassets, liabilities, financial position and profit or loss of the Company and its consolidated companies and that

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this report of the board of directors gives a true and fair view of the position as per the balance sheet date, thedevelopment and performance of the Company and its consolidated companies, together with the principal riskand uncertainties that they face.

4.2 In control statement (Dutch Corporate Governance Code)

The board of directors of D.E MASTER BLENDERS hereby confirms that it is responsible for the design,implementation and operation of the Company’s internal risk management and control systems. The purpose ofthese systems is to adequately and effectively manage the significant risks to which the Company is exposed.Such systems can never provide absolute assurance regarding achievement of corporate objectives, nor can theyprovide an absolute assurance that material errors, losses, fraud and the violation of laws or regulations will notoccur.

The board of directors declares regarding the financial reporting risks, except with respect to the Brazilianoperations where the internal risk management and control systems showed a material weakness (as further setout below), (i) that the internal risk management and control systems provide a reasonable assurance that thefinancial reporting does not contain any errors of material importance and (ii) that the risk management andcontrol systems worked properly in the financial year ended on June 30, 2012.

The material weakness with respect to our Brazilian operations relates to an ineffective control environmentover finance reporting maintained by management in Brazil which began prior to 2009 through 2012, thatpermitted to go undetected during that period, intentional overrides of internal controls as well as cross-functional collusion by management in Brazil and communication and actions by management in Brazil thatcontributed to a lack of adherence to existing internal control procedures and IFRS. The investigation did not findevidence that these practices spread to operations outside of Brazil. Based on the results of the investigation intothe irregularities, we have taken appropriate action to reinforce and enhance the internal control over financialreporting and governance and disclosure controls and procedures in our Brazilian operations and we have takenother remedial and disciplinary actions. These remedial actions included making appropriate changes in theBrazilian management and finance teams, including replacing the chief executive officer, the chief financialofficer and the local controller who are no longer employed by us, adopting enhanced internal audit procedureswith respect to the Brazilian operations, reviewing reporting lines, strengthening the Global Business Practicesfunction in Brazil, and providing additional compliance and business ethics training to relevant departments andemployees.

The statements on internal control above should not be construed as a statement in response to therequirements of the United States Sarbanes-Oxley Act.

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ITEM 19. EXHIBITS

Index to Exhibits

1.1 Articles of Association of the Registrant(1)

1.2 Deed of Amendment of Articles of Association of the Registrant(2)

4.1 Master Separation Agreement dated June 15, 2012 between Sara Lee, D.E MASTER BLENDERS andDE US, Inc.(3)

4.2 Merger Agreement

4.3 D.E MASTER BLENDERS 1753 N.V. 2012 Long Term Incentive Share Plan(4)

4.4 Agreement dated August 30, 2011 between Sara Lee Corporation and Michiel Herkemij(5)

4.5 Lease Agreement for Purposes Other Than That of Housing dated as of December 17, 2010 betweenFelix y Enrique Marcilla S.L. and Sara Lee Southern Europe S.L. and Declaration of Amendmentdated February 11, 2011(6)

4.6 Partnership Agreement dated March 30, 2012 between Philips Consumer Lifestyle B.V., KoninklijkePhilips Electronics N.V. and Sara Lee/DE B.V. (7)†

4.7 Trademark Transfer Agreement dated March 30, 2012 between Koninklijke Philips Electronics N.V.and Sara Lee/DE B.V.(8)

4.8 Addendum to Agreement dated August 30, 2011 between Sara Lee Corporation and MichielHerkemij(9)

4.9 Note Purchase and Guarantee Deed dated May 15, 2012 by and among DE US, Inc., D.E MASTERBLENDERS 1753 B.V. and Sara Lee Corporation(10) †

4.10 Revolving Credit Facility Agreement, dated May 22, 2012(11)

4.11 Bridge Loan Agreement No. 1 dated May 29, 2012(13)

4.12 Bridge Loan Agreement No. 2 dated May 29, 2012(14)

4.13 Bridge Loan Guaranty dated May 29, 2012(15)

4.14 Transition Services Agreement dated June 15, 2012 between Sara Lee and D.E MASTER BLENDERS

4.15 Tax Sharing Agreement dated June 15, 2012 between, among others, Sara Lee, D.E MASTERBLENDERS, and DE US, Inc.

4.16 Employee Matters Agreement dated June 15, 2012 between Sara Lee and D.E MASTER BLENDERS

4.17 Intellectual Property Separation Agreement dated June 15, 2012 between Sara Lee and D.E MASTERBLENDERS

4.18 License and Services Agreement with JMS Foodservice, LLC dated January 3, 2012.‡

8.1 Subsidiaries of the Registrant

12.1 Certification of Michiel Herkemij required by Rule 13a-14(b) or Rule 15d-14(b).

12.2 Certifications of Michel Cup required by Rule 13a-14(b) or Rule 15d-14(b).

13.1 Certification of Michiel Herkemij and Michel Cup required by Section 1350 of 18 U.S.C. 63.

† Confidential portions of the exhibit have been omitted and filed separately with the SEC pursuant to arequest for confidential treatment under Rule 406 of the Securities Act.

‡ Confidential portions of the exhibit have been omitted and filed separately with the SEC pursuant to arequest for confidential treatment under Rule 24b-2 of the Securities Exchange Act.

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(1) Incorporated by reference to Exhibit 3.2 to Form F-1 Amendment No. 2 (file no. 0001193125-12-162832)filed with the SEC on April 13, 2012.

(2) Incorporated by reference to Exhibit 3.2 to Form F-1 (file no. 0001193125-12-092435) filed with the SECon March 1, 2012.

(3) Incorporated by reference to Exhibit 2.1 to Form F-1 Amendment No. 3 (file no. 0001193125-12-228107)filed with the SEC on May 11, 2012.

(4) Incorporated by reference to Exhibit 10.1 to Form F-1 Amendment No. 3 filed with the SEC on May 11,2012.

(5) Incorporated by reference to Exhibit 10.9 to Form F-1 filed with the SEC on March 1, 2012.(6) Incorporated by reference to Exhibit 10.3 to Form F-1 Amendment No. 2 filed with the SEC on April 13,

2012.(7) Incorporated by reference to Exhibit 10.4 to Form F-1 Amendment No. 2 filed with the SEC on April 13,

2012.(8) Incorporated by reference to Exhibit 10.5 to Form F-1 Amendment No. 2 filed with the SEC on April 13,

2012.(9) Incorporated by reference to Exhibit 10.6 to Form F-1 Amendment No. 4 (file no. 0001193125-12-241747)

filed with the SEC on May 21, 2012.(10) Incorporated by reference to Exhibit 10.7 to Form F-1 Amendment No. 4 filed with the SEC on May 21,

2012.(11) Incorporated by reference to Exhibit 10.8 to Form F-1 Amendment No. 5 (file no. 0001193125-12-247098)

filed with the SEC on May 24, 2012.(12) Incorporated by reference to Exhibit 10.9 to Form F-1 Amendment No. 6 (file no. 0001193125-12-252240)

filed with the SEC on May 30, 2012.(13) Incorporated by reference to Exhibit 10.9 to Form F-1 Amendment No. 6 filed with the SEC on May 30,

2012.(14) Incorporated by reference to Exhibit 10.10 to Form F-1 Amendment No. 6 filed with the SEC on May 30,

2012.(15) Incorporated by reference to Exhibit 10.11 to Form F-1 Amendment No. 6 filed with the SEC on May 30,

2012.

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SIGNATURES

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it hasduly caused and authorized the undersigned to sign this annual report on its behalf.

D.E MASTER BLENDERS 1753 N.V.

/s/ Michel M. G. Cup

Michel M. G. CupChief Financial Officer

Date: October 11, 2012

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Exhibit 4.2

Execution Version

AGREEMENT AND PLAN OF MERGER

DATED AS OF JUNE 15, 2012

BY AND AMONG

SARA LEE CORPORATION,

DE US, INC.,

D.E MASTER BLENDERS 1753 B.V.

AND

DEMB MERGER COMPANY

Table of Contents Page

ARTICLE I DEFINITIONS 2 1.1 Definitions 2

ARTICLE II THE MERGER 3 2.1 The Merger 3 2.2 Closing 3 2.3 Effective Time 4 2.4 Merger Exchange 4 2.5 Effect of the Merger on Shares 4 2.6 Merger Consideration Mechanics 5 2.7 Certificate of Incorporation and Bylaws of the Surviving Corporation 7 2.8 Directors and Officers of the Surviving Corporation 8 2.9 Qualification as Reorganization 8

ARTICLE III REPRESENTATIONS AND WARRANTIES 8 3.1 Representations and Warranties of Sara Lee and CoffeeCo 8 3.2 Representations and Warranties of DutchCo and Merger Sub 8

ARTICLE IV COVENANTS AND AGREEMENTS 9 4.1 Required Actions 9

ARTICLE V CONDITIONS TO THE MERGER 9 5.1 Conditions to Each Party’s Obligation to Effect the Merger 9 5.2 Additional Conditions to the Obligations of Sara Lee and CoffeeCo 10 5.3 Additional Conditions to the Obligations of DutchCo and Merger Sub 10

ARTICLE VI GENERAL PROVISIONS 10 6.1 Termination 10 6.2 Entire Agreement 10 6.3 Governing Law 10 6.4 Amendment 10 6.5 Waivers 11 6.6 Partial Invalidity 11 6.7 Execution in Counterparts 11 6.8 Successors and Assigns 11 6.9 No Third Party Beneficiaries 11 6.10 Notices 11 6.11 Force Majeure 12 6.12 Limited Liability 12 6.13 Plan of Reorganization 13 6.14 Dispute Resolution 13 6.15 Interpretation 13 6.16 Survival 13

AGREEMENT AND PLAN OF MERGER

THIS AGREEMENT AND PLAN OF MERGER, dated as of June 15, 2012 (this “Agreement”), is by and among Sara Lee Corporation, a Maryland corporation (“Sara Lee”), DE US, Inc., a Delaware corporation (“CoffeeCo”), and, as of the date hereof, a wholly-owned subsidiary of Sara Lee, D.E MASTER BLENDERS 1753 B.V., a private company with limited liability with a corporate seat in Joure (Skarsterlân), The Netherlands (“DutchCo”), and, as of the date hereof, a wholly-owned subsidiary of CoffeeCo, and DEMB Merger Company, a Delaware corporation and wholly-owned subsidiary of DutchCo (“Merger Sub”). Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Master Separation Agreement, entered into by and between Sara Lee, CoffeeCo and DutchCo, on or around the date hereof (the “Master Separation Agreement”).

WHEREAS, CoffeeCo, through the CoffeeCo Business, is engaged in the business of producing and selling high-quality, innovative coffee and tea products and the Sara Lee Board has determined that it would be advisable and in the best interests of Sara Lee and its stockholders for Sara Lee to distribute, on a pro rata basis to the holders of Sara Lee Shares without any consideration being paid by the holders thereof, all of the outstanding CoffeeCo Shares;

WHEREAS, upon the terms and subject to the conditions set forth in the Master Separation Agreement, Sara Lee shall, among other things, on the Distribution Date, effect the Distribution and distribute all of the outstanding CoffeeCo Shares to the Exchange Agent to hold for the benefit of the holders of outstanding Sara Lee Shares;

WHEREAS, after the Distribution and payment of the CoffeeCo Special Dividend but prior to any CoffeeCo Shares being released by the Exchange Agent and physically distributed to holders of Sara Lee Shares, upon the terms and subject to the conditions set forth in this Agreement and in accordance with the General Corporation Law of the State of Delaware (the “DGCL”), CoffeeCo will merge with Merger Sub, with CoffeeCo continuing as the surviving corporation (sometimes referred to herein as the “Surviving Corporation”);

WHEREAS, the CoffeeCo Board has (i) determined that the Merger and this Agreement are advisable and in the best interests ofCoffeeCo and Sara Lee, its sole stockholder, and has approved this Agreement and the transactions contemplated hereby, including the Merger, and (ii) recommended the adoption by Sara Lee, as the sole stockholder of CoffeeCo, of this Agreement;

WHEREAS, the board of directors of Merger Sub has (i) determined that the Merger and this Agreement are advisable and in the best interests of Merger Sub and DutchCo, its sole stockholder, and has approved this Agreement and the transactions contemplated hereby, including the Merger, and (ii) recommended the adoption by DutchCo, as the sole stockholder of Merger Sub, of this Agreement;

WHEREAS, the Sara Lee Board and DutchCo Board have each approved this Agreement and the transactions contemplated hereby, including the Merger, on the terms and subject to the conditions set forth in this Agreement and in accordance with the DGCL;

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WHEREAS, Sara Lee, as the sole stockholder of CoffeeCo, and DutchCo, as the sole stockholder of Merger Sub, have each executed a written consent approving this Agreement and the transactions contemplated hereby, including the Merger, on the terms and subject to the conditions set forth in this Agreement;

WHEREAS, it is the intention of the parties hereto that the Merger qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986 (the “Code”), and it is the expectation of the parties hereto that the Merger is taxable to U.S. holders of CoffeeCo Shares under Section 367 of the Code;

WHEREAS, this Agreement constitutes a “plan of reorganization” within the meaning of Treasury Regulation Section 1.368-3(a); and

WHEREAS, the Merger is expected to accomplish certain substantial business purposes of CoffeeCo and its Affiliates (which business purposes are substantially unrelated to federal tax matters).

NOW, THEREFORE, in consideration of these premises, the representations, warranties, covenants and agreements set forth in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties, intending to be legally bound hereby, agree as follows:

ARTICLE I

DEFINITIONS

1.1 Definitions. As used in this Agreement, the following terms shall have the meanings set forth in this Section 1.1: “ABN AMRO” has the meaning set forth in Section 2.6(d).

“Agreement” has the meaning set forth in the first paragraph of this Agreement.

“Certificate of Merger” has the meaning set forth in Section 2.3.

“Closing” has the meaning set forth in Section 2.2.

“Closing Date” has the meaning set forth in Section 2.2.

“Code” has the meaning set forth in the Recitals.

“CoffeeCo” has the meaning set forth in the first paragraph of this Agreement.

“DGCL” has the meaning set forth in the Recitals.

“Distribution Fund” has the meaning set forth in Section 2.4(b).

“DutchCo” has the meaning set forth in the first paragraph of this Agreement.

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“Excess Merger Shares” has the meaning set forth in Section 2.6(d).

“Excluded Share” has the meaning set forth in Section 2.5(a)(i).

“Fractional Interests Trust” has the meaning set forth in Section 2.6(d).

“Instruction Form” has the meaning set forth in Section 2.6(a).

“Master Separation Agreement” has the meaning set forth in the first paragraph of this Agreement.

“Merger Consideration” has the meaning set forth in Section 2.5(a)(i).

“Merger Effective Time” has the meaning set forth in Section 2.3.

“Merger Sub” has the meaning set forth in the first paragraph of this Agreement.

“Sara Lee” has the meaning set forth in the first paragraph of this Agreement.

“Surviving Corporation” has the meaning set forth in the Recitals.

“Surviving Corporation Shares” has the meaning set forth in Section 2.4(a).

ARTICLE II

THE MERGER

2.1 The Merger. Upon the terms and subject to the conditions set forth in this Agreement and in accordance with the DGCL, at the Merger Effective Time, the Merger shall occur pursuant to which Merger Sub shall merge with and into CoffeeCo, with CoffeeCo as the Surviving Corporation and the separate corporate existence of Merger Sub shall thereupon cease. The Surviving Corporation shall continue to exist under the laws of the State of Delaware, with all its rights, privileges, immunities, powers and franchises, unaffected by the Merger except as set forth in this Article II. After the Merger, but subject to Section 2.4, the Surviving Corporation shall be a wholly owned subsidiary of DutchCo. The Merger shall have the effects specified in the DGCL.

2.2 Closing. Upon the terms and subject to the conditions set forth herein, including the satisfaction or, to the extent permitted hereunder, waiver of all conditions to the Merger set forth in Article V, the closing of the Merger and the other transactions contemplated hereby (the “Closing”) shall take place on the same day as, but following the payment of the CoffeeCo Special Dividend (the “Closing Date”), unless this Agreement has been terminated pursuant to Section 6.1 or unless another time or date is agreed to by the parties hereto. The Closing shall take place at the offices of Skadden, Arps, Slate, Meagher & Flom LLP, 155 North Wacker Drive, Chicago, Illinois or such other location as may be agreed upon by the parties.

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2.3 Effective Time.

(a) On the Closing Date, CoffeeCo shall effect the filing of a certificate of merger relating to the Merger (the “Certificate of Merger”) with the Secretary of State of Delaware, in such form as is required by and executed and acknowledged in accordance with the relevant provisions of the DGCL, and shall make all other filings or recordings required under the DGCL.

(b) The Merger shall become effective at (i) the date and time on which the Certificate of Merger is duly filed with the Secretary of State of Delaware as required to effect the Merger, or (ii) such subsequent date and time as specified in the Certificate of Merger (such time that the Merger shall become effective being the “Merger Effective Time”).

2.4 Merger Exchange. Upon the terms and subject to the conditions of this Agreement and the Exchange Agent Agreement and in accordance with provisions of Section 2:94b of the Dutch Civil Code, as soon as possible after the Merger Effective Time, on the Closing Date:

(a) The Exchange Agent, acting solely for the account of the former stockholders of CoffeeCo, shall contribute, for the account of such holders, all of the issued and outstanding shares of common stock, par value $0.01 per share, of the Surviving Corporation (“Surviving Corporation Shares”) that were issued to the Exchange Agent solely for the account and benefit of the former stockholders of CoffeeCo pursuant to Section 2.5(b) to DutchCo as a contribution in kind (inbreng op aandelen anders dan in geld).

(b) In consideration of the contribution pursuant to Section 2.4(a), DutchCo shall issue to the Exchange Agent (through certificates or book-entry authorizations) solely for the account and benefit of the former stockholders of CoffeeCo, the maximum number of DutchCo Shares that has become issuable pursuant to Section 2.5(a)(i) for delivery to the Merger Consideration recipients entitled thereto (such DutchCo Shares being the “Distribution Fund”). At the Merger Effective Time, the obligations of DutchCo and the Exchange Agent under this Section 2.4 shall be unconditional.

2.5 Effect of the Merger on Shares.

(a) As a result of the Merger and without any further action on the part of the holder of any capital stock of CoffeeCo, DutchCo or Merger Sub, at the Merger Effective Time:

(i) each CoffeeCo Share issued and outstanding immediately prior to the Merger Effective Time (other than shares cancelled in accordance with Section 2.5(a)(ii) (each, an “Excluded Share”)) shall automatically be converted into the right to receive one fully paid and non-assessable DutchCo Share (such number of DutchCo Shares, the “Merger Consideration”).

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(ii) each CoffeeCo Share held by CoffeeCo as treasury stock, if any, immediately prior to the Merger Effective Time shall be cancelled and shall cease to exist and no stock or other consideration shall be issued or delivered in exchange therefor.

(iii) each share of common stock of Merger Sub issued and outstanding immediately prior to the Merger Effective Time shall no longer be outstanding, be cancelled and retired.

(iv) Any DutchCo Shares that are held by CoffeeCo immediately prior to the Merger Effective Time shall be cancelled and extinguished and cease to exist.

(b) Immediately following the Merger Effective Time, the Surviving Corporation shall issue to the Exchange Agent, solely for the account and benefit of the former stockholders of CoffeeCo, a number of Surviving Corporation Shares equal to the total number of CoffeeCo Shares outstanding immediately prior to the Merger.

(c) From and after the Merger Effective Time, no CoffeeCo Shares shall remain outstanding and all CoffeeCo Shares shall be cancelled and retired and shall cease to exist. Each entry in the records of CoffeeCo or its transfer agent formerly representing CoffeeCo Shares shall thereafter represent only the right to receive the Merger Consideration and any distribution or dividend pursuant to Section 2.6(c). From and after the Merger Effective Time, there shall be no registration of transfers on the stock transfer books of the Surviving Corporation of CoffeeCo Shares that were issued prior to the Merger Effective Time.

(d) In accordance with Section 262 of the DGCL, no appraisal rights shall be available to holders of CoffeeCo Shares in connection with the Merger.

2.6 Merger Consideration Mechanics. At the Merger Effective Time, the CoffeeCo Shares shall be converted into the right to receive the Merger Consideration pursuant to, and in accordance with the terms of, this Agreement, immediately following which the Exchange Agent shall distribute on the same basis as the CoffeeCo Shares would have been distributed in the Distribution and to the persons entitled to receive CoffeeCo Shares in the Distribution, in respect of the outstanding Sara Lee Shares held by holders of record of Sara Lee Shares on the Record Date, the Merger Consideration into which the CoffeeCo Shares that otherwise would have been distributed in the Distribution have been converted pursuant to the Merger (and cash in lieu of fractional shares as provided by Section 2.6(d)). The Exchange Agent shall not be entitled to vote or exercise any rights of ownership with respect to DutchCo Shares held by it from time to time hereunder, other than to the extent necessary to effectuate the Distribution. DutchCo agrees that, from and after the Merger Effective Time, those holders of record of Sara Lee Shares who have become holders of record of DutchCo Shares by virtue of the Distribution and the Merger shall be holders of record of DutchCo Shares for all purposes for so long as they hold such DutchCo Shares.

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(a) Instruction Forms. In accordance with the terms and conditions of the Exchange Agent Agreement, the parties shall cause appropriate instruction materials (the “Instruction Form”) to be provided by the Exchange Agent to holders of record of Sara Lee Shares as of the Record Date, advising such holders of the Distribution and the Merger and the procedure for providing instructions to the Exchange Agent to effect the crediting or the transfer of their DutchCo Shares to Euroclear Nederland-eligible securities accounts. Such holders that do not provide a valid Instruction Form to the Exchange Agent shall have their DutchCo shares entered into the DutchCo stockholder register maintained on behalf of DutchCo by the Exchange Agent. Any stockholder that does not properly complete and return the Instruction Form will not be eligible to sell such stockholder’s DutchCo Shares over or through Euroclear Nederland.

(b) Delivery of Merger Consideration. After the Merger Effective Time, the Exchange Agent shall be required to deliver to each former stockholder of CoffeeCo (subject to Section 2.6(f)), (i) the number of DutchCo Shares in respect of the aggregate Merger Consideration that each holder is entitled to receive pursuant to Section 2.5, provided that such delivery shall be made by book-entry to the DutchCo stockholder register maintained by the Exchange Agent, and (ii) any cash in lieu of fractional shares which the holder has the right to receive pursuant to Section 2.6(d) and in respect of any dividends or other distributions which the holder has the right to receive pursuant to Section 2.6(c). The DutchCo Shares issued and paid in accordance with the terms of this Section 2.6(b) upon conversion of any CoffeeCo Shares (including any cash paid in lieu of fractional shares pursuant to Section 2.6(d)) shall be deemed to have been issued and paid in full satisfaction of all rights pertaining to such CoffeeCo Shares.

(c) Distribution with Respect to Undistributed Shares. All DutchCo Shares to be issued to the Exchange Agent pursuant to Section 2.4(b) shall be deemed issued and outstanding as of the Merger Effective Time and whenever a dividend or other distribution is declared by DutchCo in respect of DutchCo Shares, the record date for which is at or after the Merger Effective Time, that declaration shall include dividends or other distributions in respect of all DutchCo Shares issuable pursuant to this Agreement. No dividends or other distributions in respect of the DutchCo Shares shall be paid with respect to any DutchCo Shares that have not been distributed by the Exchange Agent promptly after the Merger Effective Time, whether due to a legal impediment to such distribution or otherwise. Subject to the effect of applicable Laws, following the distribution of any such previously undistributed DutchCo Shares, there shall be paid to the record holder of such DutchCo Shares, without interest, (A) at the time of such distribution, the amount of cash payable in lieu of fractional DutchCo Shares to which such holder is entitled pursuant to Section 2.6(d) and the amount of dividends or other distributions with a record date after the Merger Effective Time theretofore payable with respect to such DutchCo Shares and not paid and (B) at the appropriate payment date, the dividends or other distributions payable with respect to such DutchCo Shares with a record date after the Merger Effective Time but with a payment date subsequent to the distribution of such DutchCo Shares.

(d) Fractional Shares. No fractional DutchCo Shares will be issued in the Merger. Notwithstanding any other provision of this Agreement, each holder of CoffeeCo Shares converted pursuant to Section 2.5(a) who would otherwise have been entitled to receive a fraction of a DutchCo Share shall receive from the Exchange Agent, in lieu thereof, cash (without interest) in an amount representing such holder’s proportionate interest in the net proceeds from the sale by ABN AMRO Bank N.V. (“ABN AMRO”) on behalf of all such

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holders of DutchCo Shares which would otherwise be issued (the “Excess Merger Shares”). The sale of the Excess Merger Shares by ABN AMRO shall be executed on NYSE Euronext Amsterdam as promptly as practicable after the Merger Effective Time (consistent with obtaining the best execution of such sales in light of prevailing market conditions) and shall be executed in round lots to the extent practicable. ABN AMRO shall promptly transfer the proceeds of such sale or sales, net of brokerage fees, transfer taxes and other out-of-pocket transaction costs, to the Exchange Agent. Until the net proceeds of such sale or sales have been distributed to such holders of CoffeeCo Shares, the Exchange Agent shall hold such net proceeds in trust for such holders (the “Fractional Interests Trust”). The Exchange Agent shall determine the portion of the Fractional Interests Trust to which each holder of CoffeeCo Shares shall be entitled, if any, by multiplying the amount of the aggregate net proceeds comprising the Fractional Interests Trust by a fraction, the numerator of which is the amount of fractional interests to which such holder of CoffeeCo Shares is entitled and the denominator of which is the aggregate amount of fractional interests to which all holders of CoffeeCo Shares are entitled. As soon as practicable after the determination of the amount of cash, if any, to be paid to holders of CoffeeCo Shares in lieu of fractional interests, the Exchange Agent shall use all reasonable efforts to make available such amounts to such holders of CoffeeCo Shares as promptly following the Merger Effective Time as is practicable.

(e) Withholding Rights. Each of Sara Lee, DutchCo, the Surviving Corporation and the Exchange Agent shall be entitled to deduct and withhold from any amounts payable pursuant to this Article II to any Person such amounts as it is required to deduct and withhold with respect to the making of such payment under the Code, or any provision of state, local or non-U.S. tax law. To the extent that amounts are so deducted and withheld by or on behalf of Sara Lee, DutchCo, the Surviving Corporation or the Exchange Agent, as the case may be, and paid over to the relevant Governmental Authority, such deducted and withheld amounts shall be treated for all purposes of this Agreement as having been paid to such Person in respect of which such deduction and withholding was made.

(f) Termination of Distribution Fund and Fractional Interests Trust. Any portion of the Distribution Fund and Fractional Interests Trust that remains unclaimed by the former stockholders of CoffeeCo for one year after the Merger Effective Time shall be delivered to DutchCo and any former stockholders of CoffeeCo who have not received DutchCo Shares in accordance with this Article II shall thereafter look only to DutchCo for payment of their claim for DutchCo Shares and any dividends, distributions or cash in lieu of fractional shares with respect to such DutchCo Shares. Notwithstanding the foregoing, none of DutchCo, CoffeeCo, Sara Lee, Merger Sub and the Exchange Agent or any other Person shall be liable to any former holder of CoffeeCo Shares or Sara Lee Shares for any amount properly delivered to a public official pursuant to applicable abandoned property, escheat or similar Laws.

2.7 Certificate of Incorporation and Bylaws of the Surviving Corporation.

(a) At the Merger Effective Time, the certificate of incorporation of CoffeeCo as in effect immediately prior to the Merger Effective Time shall be the certificate of incorporation of the Surviving Corporation until thereafter duly amended in accordance with such certificate of incorporation and applicable law.

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(b) At the Merger Effective Time, the bylaws of CoffeeCo as in effect immediately prior to the Merger Effective Time shall be the bylaws of the Surviving Corporation until thereafter duly amended in accordance with the certificate of incorporation of the Surviving Corporation, such bylaws and applicable law.

2.8 Directors and Officers of the Surviving Corporation. The directors of CoffeeCo at the Merger Effective Time shall, from and after the Merger Effective Time, be the initial directors of the Surviving Corporation. The officers of CoffeeCo at the Merger Effective Time shall, from and after the Merger Effective Time, be the initial officers of the Surviving Corporation. Such directors and officers shall serve until their successors have been duly elected or appointed and qualified or until their earlier death, resignation or removal in accordance with the Surviving Corporation’s certificate of incorporation and bylaws.

2.9 Qualification as Reorganization. The Merger is intended to qualify as a reorganization under Section 368(a) of the Code. It is the expectation of the parties that the Merger is taxable to U.S. stockholders under Section 367 of the Code.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

3.1 Representations and Warranties of Sara Lee and CoffeeCo. Sara Lee and CoffeeCo represent and warrant to DutchCo and Merger Sub, as of the date hereof, as follows:

(a) Organization; Corporate Authority; Validity of Agreement. Each of Sara Lee and CoffeeCo is a corporation duly organized, validly existing and in good standing under the laws of the state of its organization. Each of Sara Lee and CoffeeCo has all requisite corporate power and authority to execute, deliver and perform the terms and provisions of this Agreement and to consummate the transactions contemplated hereby. The execution, delivery and performance by each of Sara Lee and CoffeeCo of this Agreement, and the consummation of the transactions contemplated hereby, have been duly authorized by all necessary corporate action, subject to receipt of the written consent of Sara Lee, as the sole stockholder of CoffeeCo. This Agreement has been duly executed and delivered by each of Sara Lee and CoffeeCo and (assuming due and valid authorization, execution and delivery hereof by DutchCo and Merger Sub) is a valid and binding obligation of each of Sara Lee and CoffeeCo enforceable against each of them in accordance with its terms.

(b) No Other Representations. Except for the representations and warranties contained in this Section 3.1 the Master Separation Agreement, or any other Transaction Agreements, including the Tax Representations, Sara Lee and CoffeeCo make no representation or warranty, express or implied, as to any matter whatsoever.

3.2 Representations and Warranties of DutchCo and Merger Sub. DutchCo and Merger Sub represent and warrant to Sara Lee and CoffeeCo, as of the date hereof, as follows:

(a) Organization; Corporate Authority; Validity of Agreement. DutchCo is a public company with limited liability, duly organized and existing under the laws

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of the Netherlands. Merger Sub is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. Each of DutchCo and Merger Sub has all requisite corporate power and authority to execute, deliver and perform the terms and provisions of this Agreement and to consummate the transactions contemplated hereby. The execution, delivery and performance by each of DutchCo and Merger Sub of this Agreement, and the consummation of the transactions contemplated hereby, have been duly authorized by all necessary corporate action. This Agreement has been duly executed and delivered by each of DutchCo and Merger Sub and (assuming due and valid authorization, execution and delivery hereof by Sara Lee and CoffeeCo) is a valid and binding obligation of each of DutchCo and Merger Sub enforceable against each of them in accordance with its terms.

(b) DutchCo Shares. All outstanding DutchCo Shares are, and, at the time of issuance, all DutchCo Shares issued pursuant to this Agreement will be, duly authorized, validly issued, fully paid and non-assessable and not subject to, or issued in violation of, any purchase option, call option, right of first refusal, preemptive right, subscription right or any other similar right.

(c) No Other Representations. Except for the representations and warranties contained in this Section 3.2, the Master Separation Agreement or any other Transaction Agreements, including the Tax Representations, DutchCo and Merger Sub make no representation or warranty, express or implied, as to any matter whatsoever.

ARTICLE IV

COVENANTS AND AGREEMENTS

4.1 Required Actions. Upon the terms and subject to the conditions set forth in this Agreement, each of the parties shall use their respective commercially reasonable efforts to take, or cause to be taken, all actions, and do, or cause to be done, and assist and cooperate with the other parties in doing, all things reasonably appropriate to consummate and make effective, as soon as reasonably possible and after the Distribution and payment of the CoffeeCo Special Dividend, the Merger and the other transactions contemplated by this Agreement, including obtaining the written consent of the sole stockholders of CoffeeCo and Merger Sub, approving this Agreement and the transaction contemplated hereby.

ARTICLE V

CONDITIONS TO THE MERGER

5.1 Conditions to Each Party’s Obligation to Effect the Merger. The respective obligation of each party to effect the Merger is subject to the satisfaction (or waiver) at or prior to the Merger Effective Time of the following conditions:

(a) The Distribution shall have been effected in accordance with the terms and conditions of the Master Separation Agreement.

(b) The CoffeeCo Special Dividend shall have been paid.

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5.2 Additional Conditions to the Obligations of Sara Lee and CoffeeCo. The obligation of Sara Lee and CoffeeCo to consummate the Merger shall be subject to the satisfaction (or waiver by Sara Lee) at or prior to the Merger Effective Time of the following conditions:

(a) Each of the representations and warranties of DutchCo and Merger Sub set forth in this Agreement shall be true and correct as of the date of this Agreement and as of the Closing Date as though such representations and warranties were made on and as of the Closing Date.

5.3 Additional Conditions to the Obligations of DutchCo and Merger Sub. The obligation of DutchCo and Merger Sub to consummate the Merger shall be subject to the satisfaction (or waiver by DutchCo) at or prior to the Merger Effective Time of the following condition:

(a) Each of the representations and warranties of Sara Lee and CoffeeCo set forth in this Agreement shall be true and correct as of the date of this Agreement and as of the Closing Date as though such representations and warranties were made on and as of the Closing Date.

ARTICLE VI

GENERAL PROVISIONS

6.1 Termination. Notwithstanding anything to the contrary contained herein, this Agreement may be terminated and the Merger abandoned at any time prior to the Merger Effective Time by and in the sole discretion of the Sara Lee Board without the prior approval of any Person. In the event of such termination, this Agreement shall forthwith become void, and no party shall have any liability to any Person by reason of this Agreement.

6.2 Entire Agreement. This Agreement, the Master Separation Agreement and the Transaction Agreements, including the schedules and exhibits referred to therein, and the documents delivered pursuant hereto and thereto, contain the entire understanding of the parties with regard to the subject matter contained herein or therein, and supersede all prior agreements, negotiations, discussions, understandings, writings and commitments between any of the Sara Lee Parties, on the one hand, and any of the CoffeeCo Parties, on the other hand, with respect to such subject matter hereof or thereof.

6.3 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without reference to conflict of law principles thereof.

6.4 Amendment. This Agreement shall not be amended, modified or supplemented except by a written instrument signed by an authorized representative of each of Sara Lee, CoffeeCo, DutchCo and Merger Sub.

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6.5 Waivers. Any term or provision of this Agreement may be waived, or the time for its performance may be extended, by the party or parties entitled to the benefit thereof. Any such waiver shall be validly and sufficiently given for the purposes of this Agreement if, as to any party, it is in writing signed by an authorized representative of such party. The failure of any party to enforce at any time any provision of this Agreement shall not be construed to be a waiver of such provision, or in any way to affect the validity of this Agreement or any part hereof or the right of any party thereafter to enforce each and every such provision. No waiver of any breach of this Agreement shall be held to constitute a waiver of any other or subsequent breach.

6.6 Partial Invalidity. Wherever possible, each provision hereof shall be construed in a manner as to be effective and valid under applicable law, but in case any one or more of the provisions contained herein shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such provision shall be ineffective to the extent, but only to the extent of such invalidity, illegality or unenforceability without invalidating the remainder of such invalid, illegal or unenforceable provision or provisions or any other provision hereof, unless such a construction would be unreasonable.

6.7 Execution in Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original instrument, but all of which shall be considered one and the same agreement, and shall become binding when the counterparts have been signed by and delivered to each of the parties.

6.8 Successors and Assigns. No party may assign any of its rights or obligations under this Agreement to another Person without the consent of each of the other parties to this Agreement. Subject to the foregoing, (a) this Agreement and all the terms and provisions hereof shall be binding upon and inure to the benefit of the parties and their respective successors and permitted assigns, and (b) each party shall require any Person or Persons that, as a result of any merger, purchase of assets, reorganization or other transaction, acquires or succeeds to all or substantially all of its business or assets to assume its obligations under this Agreement pursuant to a written assumption agreement in form and substance reasonably satisfactory to each other party.

6.9 No Third Party Beneficiaries. This Agreement is solely for the benefit of the parties and their respective successors and permitted assigns, and nothing herein express or implied shall give or be construed to give to any other Person any legal or equitable rights hereunder.

6.10 Notices. All notices, requests, claims, demands and other communications required or permitted hereunder shall be in writing and shall be deemed given or delivered (a) when delivered personally, (b) if transmitted by email, on the date the recipient confirms receipt, (c) if sent by registered or certified mail, postage prepaid, return receipt requested, on the third business day after mailing or (d) if sent by nationally recognized overnight courier, on the first business day following the date of dispatch; and shall be addressed as follows:

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If to CoffeeCo prior to or on June 28, 2012, to: DE US, Inc. 3500 Lacey Road Downers Grove, Illinois 60515 Attention: Helen N. Kaminski Email: helen.kaminski@hillshirebrands.com

If to CoffeeCo after June 28, 2012, to: DE US, Inc. Oosterdokstraat 80 1011 DK Amsterdam, The Netherlands Attention: Onno van Klinken Email: onno.vanklinken@demb.com

If to Sara Lee, to: Sara Lee Corporation 3500 Lacey Road Downers Grove, Illinois 60515 Attention: Kent Magill, General Counsel Email: kent.magill@hillshirebrands.com

If to DutchCo or Merger Sub, to: D.E MASTER BLENDERS 1753 B.V. Oosterdokstraat 80 1011 DK Amsterdam, The Netherlands Attention: Onno van Klinken, General Counsel Email: onno.vanklinken@demb.com

or to such other address as such party may indicate by a notice delivered to the other party in accordance herewith.

6.11 Force Majeure. No party shall be deemed in default of this Agreement to the extent that any delay or failure in the performance of its obligations under this Agreement results from any cause beyond its reasonable control and without its fault or negligence, including acts of God, acts of civil or military authority, embargoes, acts of terrorism, epidemics, war, riots, insurrections, fires, explosions, earthquakes, floods, unusually severe weather conditions, labor problems or unavailability of parts, or, in the case of computer systems, any failure in electrical or air conditioning equipment. In the event of any such excused delay, the time for performance shall be extended for a period equal to the time lost by reason of the delay.

6.12 Limited Liability. Notwithstanding any other provision of this Agreement, no individual who is a stockholder, director, employee, officer, agent or representative of Sara Lee, CoffeeCo, DutchCo or Merger Sub, in such individual’s capacity as such, shall have any liability in respect of or relating to the covenants or obligations of Sara Lee,

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CoffeeCo, DutchCo or Merger Sub, as applicable, under this Agreement or any other Transaction Agreement or in respect of any certificate delivered with respect hereto or thereto, and, to the fullest extent legally permissible, each of Sara Lee, CoffeeCo, DutchCo and Merger Sub, for itself and its stockholders, directors, employees, officers and Affiliates, waives and agrees not to seek to assert or enforce any such liability that any such individual otherwise might have pursuant to applicable law.

6.13 Plan of Reorganization. For U.S. federal income tax purposes, this Agreement shall constitute a “plan of reorganization” within the meaning of Section 368 of the Code and the Treasury Regulations promulgated thereunder.

6.14 Dispute Resolution. All disputes, controversies or claims arising under or in connection with this Agreement shall be governed by Article XII of the Master Separation Agreement. Each of the parties agrees that the procedures set forth in Article XII of the Master Separation Agreement shall be the sole and exclusive remedy in connection with any dispute, controversy or claim arising under or in connection with this Agreement.

6.15 Interpretation. The terms and conditions of Section 1.2 of the Master Separation Agreement are hereby incorporated by reference and made a part of this Agreement.

6.16 Survival. None of the representations, warranties, covenants or agreements of the parties hereto contained in this Agreement shall survive the Closing Date. Effective upon Closing, each of the parties hereto shall be deemed to have waived any breaches of representations and warranties contained in this Agreement.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their authorized representatives as of the date first written above.

[Signature Page to Agreement and Plan of Merger]

SARA LEE CORPORATION

By: /s/ Marcel H.M. Smits Name: Marcel H.M. SmitsTitle: Chief Executive Officer

[Signature Page to Agreement and Plan of Merger]

DE US, INC.

By: /s/ Mark S. Silver Name: Mark S. Silver Title: President

[Signature Page to Agreement and Plan of Merger]

D.E MASTER BLENDERS 1753 B.V.

By: /s/ Michel M.G. Cup Name: Michel M.G. Cup Title: Chief Financial Officer

[Signature Page to Agreement and Plan of Merger]

DEMB MERGER COMPANY

By: /s/ Michel M.G. Cup Name: Michel M.G. Cup Title: Vice President and Treasurer

Exhibit 4.14

Execution Version

TRANSITION SERVICES AGREEMENT

This TRANSITION SERVICES AGREEMENT (this “Agreement”), dated as of June 15, 2012, is by and among Sara Lee Corporation, a Maryland corporation (“Sara Lee”), on the one hand, and D.E MASTER BLENDERS 1753 B.V., a private company with limited liability with corporate seat in Joure (Skarsterlân), The Netherlands (“DutchCo”), and DE US, Inc., a Delaware corporation (“CoffeeCo” and together with DutchCo, the “CoffeeCo Parties”), on the other hand (each, a “Party” and collectively, the “Parties”).

RECITALS

WHEREAS, pursuant to that certain Master Separation Agreement, dated on or about the date hereof (the “Master Separation Agreement”), CoffeeCo will separate from Sara Lee, as more fully described therein;

WHEREAS, pursuant to that certain Merger Agreement, entered into on or about the date hereof, CoffeeCo will merge with a wholly-owned subsidiary of DutchCo, with CoffeeCo continuing as the surviving corporation and a wholly-owned subsidiary of DutchCo;

WHEREAS, in order to provide for an orderly transition under the Master Separation Agreement and as a condition to consummating the transactions contemplated by the Master Separation Agreement, Sara Lee and the CoffeeCo Parties have agreed to enter into this Agreement, pursuant to which Sara Lee will provide, or cause its Affiliates to provide, certain services to the CoffeeCo Parties, as set forth herein, on a transitional basis subject to the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual promises contained herein, the Parties hereby agree as follows:

ARTICLE I DEFINITIONS

Section 1.1 Definitions. Capitalized terms used in this Agreement shall have the meanings set forth in this Section 1.1, except that capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Master Separation Agreement.

(a) “Additional IT Services” has the meaning set forth in Section 2.3(b). (b) “Agreement” has the meaning set forth in the Preamble.

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(c) “CoffeeCo” has the meaning set forth in the Preamble.

(d) “CoffeeCo Parties” has the meaning set forth in the Preamble. (e) “Consultant” means the employee identified on the Side Schedule. (f) “Consulting Services” means the consulting and strategic planning services provided hereunder as set forth on

Schedule 3 and the Side Schedule. (g) “DutchCo” has the meaning set forth in the Preamble. (h) “Fiscal Year” means the fiscal year of Sara Lee. (i) “Information System Additions” has the meaning set forth in Section 5.4(c). (j) “Invoice” has the meaning set forth in Section 6.2. (k) “IT Enhancements” has the meaning set forth in Section 2.2. (l) “IT Service Change” has the meaning set forth in Section 2.3(a). (m) “IT Services” means the information technology services provided hereunder as set forth on Schedule 1. (n) “IT Services Committee” has the meaning set forth in Section 2.3(a). (o) “Master Separation Agreement” has the meaning set forth in the Recitals. (p) “Out-of-Pocket Costs” means, with respect to each Service, all documented out-of-pocket costs and expenses

incurred by or on behalf of Sara Lee, its Affiliates and Third Party service providers in connection with providing such Service (including costs and expenses associated with travel and entertainment (in accordance with Sara Lee’s travel and expense reimbursement policy), delivery, telecommunications, Internet services, Third Party service providers and contract termination fees).

(q) “Party” and “Parties” have the meaning set forth in the Preamble (r) “Sales Taxes” has the meaning set forth in Section 6.6(a). (s) “Sara Lee” has the meaning set forth in the Preamble.

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(t) “Services” means the IT Services, Tax Support Services, Consulting Services and Additional IT Services (if any), collectively.

(u) “Side Schedule” means that certain Transition Services Agreement Side Schedule, dated as of the date hereof, by and among the Parties.

(v) “Tax Support Service Termination Costs” means any costs related to severance, termination, separation and similar payments or benefits that may be payable or owed to any of the applicable Tax Support Services Employees as indicated on the Side Schedule upon or in connection with the termination of their employment in connection with the expiration or termination of any Tax Support Service, including any administrative costs relating to such termination of employment or expiration or termination of such Tax Support Service.

(w) “Tax Support Services” means the tax support services provided hereunder as set forth on Schedule 2 and the Side Schedule.

(x) “Tax Support Services Employees” means the employees identified on the Side Schedule as providing the Tax Support Services and such other persons as may be substituted for such employees in accordance with Section 3.3.

(y) “Term” has the meaning set forth in Section 9.1(a). (z) “Third Party” means any Person other than Sara Lee, the CoffeeCo Parties and their respective Affiliates. (aa) “Third Party Consents” means licenses, permits, consents and authorizations required for Sara Lee or any of its

Affiliates or Third Party service providers to provide the Services to the CoffeeCo Parties in accordance with the terms hereof.

ARTICLE II IT SERVICES

Section 2.1 Services. Subject to the terms and conditions of this Agreement, including the CoffeeCo Parties’ compliance herewith, Sara Lee shall, or shall cause one of its Affiliates to, provide each IT Service to the CoffeeCo Parties in accordance with Schedule 1. Sara Lee may use its Affiliates or Third Party service providers to provide the IT Services to the CoffeeCo Parties hereunder; provided that Sara Lee shall cause such Affiliates and Third Party service providers to comply with the terms hereof. Standard. Subject to the terms and conditions of this Agreement, including the CoffeeCo Parties’ compliance herewith, Sara Lee shall provide the IT Services in a manner that is generally consistent with Sara Lee’s business practices as of the Effective Time, except to the extent otherwise specified on Schedule 1. Any modifications or upgrades, code changes, or enhancements made by Sara Lee to Sara Lee’s information technology environment as it concerns the IT Services (“IT Enhancements”) shall be generally consistent with current practices and shall be subject to Sara Lee’s change

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control process. Sara Lee shall use commercially reasonable efforts to maintain all existing inbound and outbound interfaces as they concern the IT Services in a manner generally consistent with that in effect as of the Effective Time. To the extent that a Third Party service provider provided to Sara Lee and CoffeeCo a shared IT service relating to or in connection with the Parties’ IT infrastructure immediately prior to the Effective Time and such Third Party service provider continues to provide such service to the Parties following the Effective Time pursuant to a Contract between such Third Party service provider and each Party, neither Party shall make any change to such service or to its IT infrastructure in connection with such service if and to the extent such change would adversely affect the corresponding service to or IT infrastructure of the other Party in any material respect; provided that either Party may propose such a change by submitting a proposal in writing to the IT Services Committee (as defined herein), which proposal shall be discussed by the IT Services Committee at its next monthly meeting. Any such change to such service provided by such Third Party service provider may only be implemented upon the mutual written consent of both Parties.

Section 2.2 IT Services Committee. (a) The Parties shall establish a committee (the “IT Services Committee”) which shall meet monthly at a mutually

convenient time (whether in person or telephonically or by videoconference) to discuss the current state of Sara Lee’s provision of IT Services and any proposed change to the term and/or scope of any IT Service (“IT Service Change”). The IT Services Committee shall consist of two (2) to three (3) representatives from each Party, each of whom is reasonably familiar with his or her respective Party’s information technology systems. The initial representatives of the IT Services Committee are set forth on Schedule 4. A Party may replace either of its IT Services Committee members at any time upon written notice to the other Party. Either Party may propose an IT Service Change by submitting a proposal in writing to the IT Services Committee, which proposal (and any change to the monthly payments and/or Out-of-Pocket Costs due by the CoffeeCo Parties under Section 6.l(a) and Section 6. l(b) that may result from the acceptance of such proposal) shall be discussed by the IT Services Committee at its next monthly meeting. Any IT Service Change may only be implemented upon the mutual written consent of both Parties (including, if applicable, an agreement in writing by both Parties of the increase or decrease in costs for such IT Service Change) or terminated as set forth in Section 9.2.

(b) The IT Services Committee may also review potential set-up services, migration support or other additional transition activities not included in the IT Services and for which the CoffeeCo Parties cannot reasonably provide or procure from a Third Party (“Additional IT Services”) and that could be reasonably performed by Sara Lee or its Affiliates for the CoffeeCo Parties; provided that Sara Lee will not be obligated to perform any such Additional IT Services unless the Parties agree in writing with respect thereto, which writing includes all material terms thereof (including the costs for such Additional IT Services, which will be in addition to the costs for the IT Services). Additional IT Services may include projects for set-up tasks, system improvements, data migration, the creation of a separate instance of all or any portion of Sara Lee’s information technology systems, the creation or installation of a new system

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or software, the facilitation of the termination of Services (including training and knowledge transfer to the CoffeeCo Parties), the facilitation of the CoffeeCo Parties’ use of Sara Lee’s systems and the facilitation of the transition of Services, infrastructure, processes and capabilities. The IT Services Committee must unanimously agree prior to recommending any Additional IT Services for the Parties to consider.

Section 2.3 Personnel. As between the Parties, Sara Lee shall have sole discretion and authority with respect to designating, employing, assigning, compensating and discharging personnel in connection with performance of the IT Services as long as it does not negatively impact the service provided to the CoffeeCo Parties as set forth in this Agreement.

Section 2.4 Escalation to Third Party Service Providers. Sara Lee will maintain formal event reporting and escalation procedures consistent with its general practices regarding the escalation to Third Party service providers of any material issues relating to the IT Services that Sara Lee cannot reasonably resolve without such Third Party assistance. Sara Lee shall communicate escalation procedures to the CoffeeCo Parties prior to the Effective Time and updates to such procedures shall be communicated as part of the IT Services Committee.

Section 2.5 Transition. Except as otherwise provided in this Agreement, the CoffeeCo Parties shall transition from the IT Services to their own internal organization or a Third Party service provider as promptly as reasonably practicable following the Effective Time, but in no event later than the expiration or termination of the applicable Term and, upon such transition, Sara Lee shall have no further obligations with respect to such IT Service.

Section 2.6 Service by the CoffeeCo Parties to Sara Lee. The CoffeeCo Parties shall, and shall cause their Affiliates to, provide to Sara Lee and its Affiliates those IT Services as indicated on and in accordance with Schedule 1, and all of the provisions of this Agreement shall apply, mutatis mutandis, to such provision by the CoffeeCo Parties and their Affiliates to Sara Lee and its Affiliates, and receipt by Sara Lee and its Affiliates from the relevant CoffeeCo Parties and their Affiliates, of such Services.

ARTICLE III TAX SUPPORT SERVICES

Section 3.1 Services. Subject to the terms and conditions of this Agreement, including the CoffeeCo Parties’ compliance herewith, Sara Lee shall, or shall cause one of its Affiliates to, provide each Tax Support Service to the CoffeeCo Parties in accordance with Schedule 2. Sara Lee may use its Affiliates or Third Party service providers to provide the Tax Support Services to the CoffeeCo Parties hereunder; provided that Sara Lee shall cause such Affiliates and Third Party service providers to comply with the terms hereof.

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Section 3.2 Standard. Subject to the terms and conditions of this Agreement, including the CoffeeCo Parties’ compliance herewith, Sara Lee shall provide the Tax Support Services in a manner that is generally consistent with Sara Lee’s business practices as of the Effective Time, except to the extent otherwise specified on Schedule 2. Notwithstanding anything to the contrary herein, Sara Lee shall have no liability to the CoffeeCo Parties in respect of any positions taken by CoffeeCo on a Tax return, including a U.S. Tax return prepared as part of the Tax Support Services, or otherwise in respect of Taxes, except as set forth in the Tax Sharing Agreement.

Section 3.3 Personnel. Sara Lee shall (i) provide the CoffeeCo Parties with as much advance notice as is reasonably practicable of any Tax Support Services Employee whose employment is terminated prior to the expiration or termination of the applicable Term and (ii) use commercially reasonable efforts to replace with internal personnel, if available, such Tax Support Services Employee whose employment is so terminated. If Sara Lee is unable to replace such individual with internal personnel, Sara Lee and the CoffeeCo Parties shall use commercially reasonable efforts to develop a mutually satisfactory plan to provide the applicable Tax Support Services for the remainder of the applicable Term, and Sara Lee and the CoffeeCo Parties shall agree on the revised monthly cost for such Tax Support Service. As between the Parties, Sara Lee shall have sole discretion and authority with respect to employing, compensating and discharging Tax Support Service Employees in connection with performance of the Tax Support Services.

Section 3.4 Service by the CoffeeCo Parties to Sara Lee. The CoffeeCo Parties shall, and shall cause their Affiliates to, provide to Sara Lee and its Affiliates those Tax Support Services as indicated on and in accordance with Schedule 2 and the Side Schedule, and all of the provisions of this Agreement shall apply, mutatis mutandis, to such provision by the CoffeeCo Parties and their Affiliates to Sara Lee and its Affiliates, and receipt by Sara Lee and its Affiliates from the relevant CoffeeCo Parties and their Affiliates, of such Services.

ARTICLE IV CONSULTING SERVICES

Section 4.1 Services. Subject to the terms and conditions of this Agreement, including the CoffeeCo Parties’ compliance herewith, Sara Lee shall cause the Consultant to provide the Consulting Services to the CoffeeCo Parties in accordance with Schedule 3.

Section 4.2 Standard. Subject to the terms and conditions of this Agreement, including the CoffeeCo Parties’ compliance herewith, Sara Lee shall cause the Consultant to provide the Consulting Services in a manner that is generally consistent with the Consultant’s provision of Consulting Services prior to the Effective Time. Notwithstanding anything to the contrary herein, Sara Lee shall have no liability to the CoffeeCo Parties in respect of the Consulting Services, including, without limitation, any liability for any act or omission by the Consultant, whether arising out of the Consulting Services or otherwise.

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Section 4.3 Personnel. Except as otherwise specifically agreed between the Parties, the Consultant shall devote 100% of his or her normal working hours to the CoffeeCo Parties. The Consultant shall be and remain an employee of Sara Lee and shall remain subject to Sara Lee’s ultimate direction and control; provided, however, Sara Lee agrees that CoffeeCo may provide daily supervision and management of the Consultant. CoffeeCo shall have unilateral discretion to terminate any Consulting Services, and Sara Lee shall have unilateral discretion to terminate the Consultant at any time and, upon the occurrence of either such event, this Agreement shall terminate with respect to the Consulting Services and neither Party shall owe the other Party any termination fees with respect to the Consultant.

ARTICLE V COOPERATION

Section 5.1 Change in Services. Sara Lee may, from time to time, reasonably supplement, modify, substitute or otherwise alter the Services; provided that any such supplements, modifications, substitutions or other alterations do not materially adversely affect the quality or scope of such Services.

Section 5.2 Third Party Consents. The Parties shall use commercially reasonable efforts to obtain and maintain the Third Party Consents. If the Third Party Consents required for a Service, or any portion thereof, are not obtained or maintained, Sara Lee shall not be obligated to provide such Service or portion thereof (as applicable); provided that the Parties shall reasonably cooperate to identify and implement alternative means of providing the CoffeeCo Parties with the benefits attributable to such Service or portion thereof (as applicable) to the extent that Sara Lee may provide such benefits without (a) violating any agreement or other arrangement with any Third Party or (b) incurring material costs, expenses or obligations. Without limiting the foregoing, the Parties shall be responsible for, if applicable, agreeing upon the offer to pay, or payment of, any money or the offer to incur, or incurrence of, any obligations to obtain Third Party Consents. CoffeeCo shall promptly reimburse Sara Lee for the agreed costs associated with any Third Party Consents or implementing alternative means to provide the Services in the absence of required Third Party Consents.

Section 5.3 Cooperation and Assistance. The CoffeeCo Parties shall, and shall cause their applicable Affiliates to, promptly take such actions, and provide such cooperation and assistance, including by providing access to its and their books, records, and other materials (whether in tangible or electronic form), as reasonably requested by Sara Lee to enable or assist Sara Lee with its obligation to provide the Services to the CoffeeCo Parties. Each Party shall use commercially reasonable efforts to minimize the expense, distraction and disturbance to the other Party in connection with its provision or receipt (as applicable) of Services hereunder.

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Section 5.4 Access to Premises and Information Systems.

(a) The CoffeeCo Parties shall provide Sara Lee, its Affiliates and Third Party service providers (as applicable) with access to the CoffeeCo Parties’ and their Affiliates’ facilities and information systems to the extent reasonably necessary for Sara Lee, its Affiliates and Third Party service providers (as applicable) to provide the Services hereunder.

(b) If Sara Lee determines that a Service requires the CoffeeCo Parties to access information systems owned, licensed, leased or used by Sara Lee or any of its Affiliates or Third Party service providers, the CoffeeCo Parties shall be provided with access thereto to the extent both reasonably practicable and reasonably necessary for the CoffeeCo Parties to receive the Services hereunder; provided that (i) the CoffeeCo Parties comply with Sara Lee’s, its Affiliates’ and Third Party service providers’ (as applicable) standard written policies and procedures that are provided to the CoffeeCo Parties reasonably in advance regarding security guidelines and procedures (including all amendments thereto) and (ii) the CoffeeCo Parties shall not, and shall ensure that their Affiliates do not, tamper with, compromise or circumvent any security or audit measure employed by Sara Lee, its Affiliates or Third Party service providers.

(c) If, in connection with the provision of any Services under this Agreement, Sara Lee implements any information technology connections, firewalls or the like specifically in connection with the provision of such Services (“Information System Additions”), the costs of implementing Information System Additions shall be borne by the CoffeeCo Parties; provided that the foregoing in this clause (c) shall not apply to Information System Additions that are implemented on or immediately following the Separation to the extent directed generally at separating information technology assets as part of the Separation.

Section 5.5 No Obligation to Make Capital Expenditures or Expend Resources. Notwithstanding anything to the contrary herein, Sara Lee and its Affiliates shall not be required to expand or modify any facilities, incur any capital expenditures, acquire any additional equipment or software or retain any specific personnel or Third Party service providers in connection with its obligation to provide Services hereunder.

ARTICLE VI COSTS AND PAYMENT

Section 6.1 Payments. (a) Monthly Payments. The CoffeeCo Parties shall pay to Sara Lee each month, with respect to:

(i) IT Services, the amount set forth on Schedule 1 (and, with respect to an IT Service Change pursuant to Section 2.3 (a), any amount agreed with respect to such IT Service Change pursuant to Section 2.3(a); with respect to an IT Enhancement pursuant to Section 2.2, any additional

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one-time cost generated in connection with such IT Enhancement; and with respect to an Information System Addition pursuant to Section 5.4(c), any cost incurred in connection with the implementation of such Information System Addition);

(ii) any Additional IT Services, the amounts agreed pursuant to Section 2.3(b), in each case including any Sales Taxes associated with such Services pursuant to Section 6.6, for each month during the applicable Terms;

(iii) Tax Support Services, the sum of the monthly portions of the annual costs for the Tax Support Services, as specified on Schedule 2;

(iv) Consulting Services, the sum of the monthly portions of the costs for the Consulting Services, as specified on Schedule 3; and

(v) notwithstanding the foregoing, in the event that any Service is terminated pursuant to Sections 9.2 or 9.4 prior to a month end, the CoffeeCo Parties shall make payment on a prorated basis based on the number of days elapsed in such month for which such terminated Service was provided.

(b) Out-of-Pocket Costs. The CoffeeCo Parties shall pay to Sara Lee all Out-of-Pocket Costs in connection with the Services; provided that, with respect any IT Services and Additional IT Services, any such Out-of-Pocket Costs must be pre-approved by the CoffeeCo members of the IT Services Committee (and Sara Lee shall have no obligation to undertake any activities not so approved).

Section 6.2 Invoicing. Sara Lee shall submit an invoice (“Invoice”) to the CoffeeCo Parties for the amounts owed pursuant to Sections 6.1(a) and 6.1(b) on a monthly basis, which shall set forth in reasonable detail the calculation thereof, including distinguishing between charges for IT Services, Additional IT Services, Tax Support Services and Consulting Services. The CoffeeCo Parties shall pay Sara Lee the amount specified in each undisputed Invoice (and with respect to any disputed Invoices, such amounts not in dispute) no later than 60 days from the date of each such Invoice; provided, however, that the CoffeeCo Parties shall only dispute an Invoice or any amount thereof in good faith.

Section 6.3 Currency and Mode of Payment. The CoffeeCo Parties shall make all payments to Sara Lee required under this Agreement by electronic transfer of immediately available United States currency to a bank account designated from time to time in writing by Sara Lee.

Section 6.4 Late Payments. Without limitation to Sara Lee’s other rights and remedies, any amount not paid related to undisputed Invoices (or with respect to disputed Invoices, any amounts not in dispute) by the CoffeeCo Parties when due pursuant to this Agreement shall accrue interest at a rate equal to the Prime Rate on the date of the Invoice plus 1.5%.

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Section 6.5 No Set-Off. The CoffeeCo Parties’ obligation to make payments hereunder shall not be subject to any right of offset, set-off, deduction or counterclaim, however arising, including pursuant to the Master Separation Agreement or any other Transaction Agreement.

Section 6.6 Taxes. (a) All consideration under this Agreement is exclusive of any sales, transfer, value-added, goods or services tax or

similar gross receipts based tax (including any such taxes that are required to be withheld, but excluding all other taxes including taxes based upon or calculated by reference to income, receipts or capital) imposed against or on Services provided by Sara Lee hereunder (“Sales Taxes”), and such Sales Taxes will be added to the consideration in the manner set forth below, where applicable.

(b) All Sales Taxes shall be separately stated on the relevant invoice to the CoffeeCo Parties hereunder. All taxable Services (and goods, if any) for which the CoffeeCo Parties are compensating, or reimbursing, Sara Lee hereunder shall be set out separately from non-taxable Services (and goods, if any), if practicable. The CoffeeCo Parties shall be responsible for any such Sales Taxes and shall either (i) promptly remit such Sales Taxes to Sara Lee (and Sara Lee shall remit such amounts to the applicable Governmental Authority as required) or (ii) provide Sara Lee with a certificate or other acceptable proof evidencing an exemption from liability for such Sales Taxes. Sara Lee agrees to pay any penalty, interest or other such fee that may be assessed against the CoffeeCo Parties arising from Sara Lee’s failure to remit Sales Taxes paid by the CoffeeCo Parties to Sara Lee in accordance with this Section 6.6(b).

(c) Notwithstanding the procedures set forth in Section 6.6(b), if Sara Lee is not legally obligated to collect or remit Sales Taxes or otherwise does not invoice and collect Sales Taxes on taxable Services (or goods, if any), it shall be the obligation of the CoffeeCo Parties to self-assess such Sales Tax as required by law and remit such Sales Tax to the relevant Governmental Authority, as applicable. The CoffeeCo Parties shall be responsible for the payment of any additions to such Sales Taxes, including penalties and interest imposed due to a failure by the CoffeeCo Parties to remit or cause to be remitted such Sales Taxes in a timely manner to the appropriate Governmental Authority in accordance with this Section 6.6(c).

(d) Each Party shall, and shall use commercially reasonable efforts to cause its respective Affiliates to, cooperate and reach mutual agreement with the other Party in all matters relating to (i) identification of the jurisdiction(s) in which each Service provided under this Agreement is performed or received, (ii) any allocation required by applicable law between the site of performance and the site of receipt with respect to each such Service and (iii) timely notifying the other Party with respect to any changes to such jurisdiction(s) with respect to each such Service. Further, Sara Lee and the CoffeeCo Parties will use commercially reasonable efforts to cooperate with one another to reduce any applicable withholding Tax to the extent allowed under applicable law.

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ARTICLE VII

INDEMNIFICATION; LIMITATION OF LIABILITY

Section 7.1 Indemnification. For the avoidance of doubt, the Parties’ indemnification obligations hereunder shall be governed by ARTICLE X of the Master Separation Agreement.

Section 7.2 Limitation of Liability. (a) Notwithstanding anything to the contrary contained herein, in no event shall Sara Lee’s liability under or in

connection with this Agreement or the Services exceed in the aggregate the amount of fees paid by the CoffeeCo Parties to Sara Lee under Section 6.1 hereof.

(b) TO THE MAXIMUM EXTENT ALLOWED UNDER APPLICABLE LAW, IN NO EVENT WILL SARA LEE BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE DAMAGES ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT, INCLUDING DAMAGES FOR LOST DATA, LOST PROFITS OR COSTS OF PROCUREMENT OF SUBSTITUTE GOODS OR SERVICES, HOWEVER CAUSED AND UNDER ANY THEORY OF LIABILITY, WHETHER BASED IN CONTRACT, TORT (INCLUDING NEGLIGENCE), STATUTE OR OTHERWISE, AND WHETHER OR NOT SARA LEE WAS OR SHOULD HAVE BEEN AWARE OR ADVISED OF THE POSSIBILITY OF SUCH DAMAGE.

Section 7.3 No Representations or Warranties. EXCEPT AS EXPRESSLY SET FORTH HEREIN OR IN THE MASTER SEPARATION AGREEMENT, ANY OTHER TRANSACTION AGREEMENT OR THE TAX REPRESENTATIONS, NEITHER SARA LEE NOR THE COFFEECO PARTIES MAKES ANY REPRESENTATION OR WARRANTY OF ANY KIND WHATSOEVER, EXPRESS OR IMPLIED, TO SARA LEE OR THE COFFEECO PARTIES, AS APPLICABLE, OR ANY OTHER PERSON WITH RESPECT TO ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR THAT ANY REQUIREMENTS OF APPLICABLE LAW ARE COMPLIED WITH RESPECT TO THE TRANSACTIONS CONTEMPLATED HEREBY. EACH OF SARA LEE AND THE COFFEECO PARTIES SHALL TAKE ANY TRANSACTION CONTEMPLATED HEREBY ON AN “AS IS, WHERE IS” BASIS, AND ALL IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A SPECIFIC PURPOSE OR OTHERWISE ARE HEREBY EXPRESSLY DISCLAIMED.

ARTICLE VIII CONFIDENTIALITY

Section 8.1 Confidentiality. The confidentiality obligations of the Parties and their Affiliates and Representatives hereunder shall be governed, mutatis mutandis, by Section 11.8 of the Master Separation Agreement.

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ARTICLE IX

TERM AND TERMINATION

Section 9.1 Term. (a) Unless this Agreement has been terminated pursuant to Section 9.2(d) or Section 9.4, this Agreement shall expire

at the expiration or earlier termination of the Services as set forth on Schedule 1, Schedule 2 and Schedule 3, as may be extended in accordance with this Section 9.1 (with respect to each Service, the “Term”).

(b) The CoffeeCo Parties may extend the Term of any IT Service for up to two additional three month periods by providing, for each additional period, written notice thereof to Sara Lee at least two months prior to the end of the Term of such IT Service.

(c) At least six months prior to the end of the Term of a Tax Support Service, the CoffeeCo Parties may request to extend the Term of such Tax Support Service; provided that Sara Lee will have no obligation to extend the Term of such Tax Support Service and any extension thereof must be in writing signed by Sara Lee.

Section 9.2 Termination. (a) Any IT Service (i) may be terminated by the mutual written consent of the Parties, (ii) may be terminated by the

CoffeeCo Parties providing two months prior written notice to Sara Lee, and (iii) shall be terminated if a transition has occurred pursuant to Section 2.6. The CoffeeCo Parties shall not be responsible for paying costs resulting from the termination of any IT Service as permitted herein, except to the extent Sara Lee has any payment obligations in connection with such termination or applicable IT Service under an agreement with a Third Party, and the Parties shall mutually cooperate to identify and minimize any such payment obligations.

(b) Any Tax Support Service may be terminated (i) by the mutual written consent of the Parties or (ii) by the CoffeeCo Parties providing six months prior written notice to Sara Lee.

(c) Any Consulting Service may be terminated unilaterally at any time by either Party by providing written notice to the other Party.

(d) In the event that a Party has failed to perform any of its material obligations under this Agreement relating to a Service, and such failure shall have continued without cure for a period of 15 days after receipt by the breaching Party of a written notice of such failure from the other Party, the other Party may terminate such Service upon prior written notice to the breaching Party. For the avoidance of doubt, non-payment by the CoffeeCo Parties for a Service provided by Sara Lee in accordance with this Agreement shall be deemed a breach for purposes of this Section 9.2(d).

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Section 9.3 Tax Support Service Termination Costs. The CoffeeCo Parties shall be responsible for paying, and shall promptly reimburse Sara Lee for, all Tax Support Service Termination Costs in connection with the expiration or termination of any Tax Support Service with respect to those Tax Support Services Employees indicated on the Side Schedule.

Section 9.4 Insolvency. In the event that either Party (a) files a petition in bankruptcy, (b) becomes or is declared insolvent, or becomes the subject of any proceedings related to its liquidation, insolvency or the appointment of a receiver, (c) makes an assignment on behalf of all or substantially all of its creditors or (d) takes any corporate action for its winding up or dissolution, then the other Party shall have the right to terminate this Agreement by providing prior written notice.

Section 9.5 Effect of Expiration and Termination. (a) Accrued Rights. Expiration and termination of this Agreement, in part or in its entirety, shall not extinguish any

rights or obligations that have accrued to the benefit of either Party prior to such expiration and termination (as applicable), including any rights of Sara Lee to receive payment under Section 6.1 hereof.

(b) Surviving Obligations. The following provisions of this Agreement, together with all other provisions of this Agreement that expressly specify that they survive, shall survive expiration and termination of this Agreement, in part or in its entirety: ARTICLE I (and any other definition required for the interpretation of the surviving provisions), ARTICLE VII, ARTICLE VIII, this ARTICLE IX, and ARTICLE X.

ARTICLE X MISCELLANEOUS

Section 10.1 Conflict with Master Separation Agreement. In the event of any conflict between the terms and conditions of this Agreement and the terms and conditions of the Master Separation Agreement, the terms and conditions of this Agreement shall control.

Section 10.2 Entire Agreement. This Agreement, the Master Separation Agreement and the other Transaction Agreements, including the Side Schedule, Schedules and Exhibits referred to herein and therein, and the documents and side letters delivered pursuant hereto and thereto, contain the entire understanding of the Parties with regard to the subject matter contained herein or therein, and supersede all prior agreements, negotiations, discussions, understandings, writings and commitments between Sara Lee or any ofthe Sara Lee Parties, on the one hand, and any of the CoffeeCo Parties, on the other hand, with respect to such subject matter hereof or thereof.

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Section 10.3 Amendment. This Agreement shall not be amended, modified or supplemented except by a written instrument signed by an authorized representative of each of Sara Lee and the CoffeeCo Parties.

Section 10.4 Waiver. Any term or provision of this Agreement may be waived, or the time for its performance may be extended, by the Party or Parties entitled to the benefit thereof. Any such waiver shall be validly and sufficiently given for the purposes of this Agreement if, as to any Party, it is in writing signed by an authorized representative of such Party. The failure of any Party to enforce at any time any provision of this Agreement shall not be construed to be a waiver of such provision, or in any way to affect the validity of this Agreement or any part hereof or the right of any Party thereafter to enforce each and every such provision. No waiver of any breach of this Agreement shall be held to constitute a waiver of any other or subsequent breach.

Section 10.5 Partial Invalidity. Wherever possible, each provision hereof shall be construed in a manner as to be effective and valid under applicable law, but in case any one or more of the provisions contained herein shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such provision shall be ineffective but only to the extent of such invalidity, illegality or unenforceability without invalidating the remainder of such invalid, illegal or unenforceable provision or provisions or any other provision hereof, unless such a construction would be unreasonable.

Section 10.6 Execution in Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original instrument, but all of which shall be considered one and the same agreement, and shall become binding when the counterparts have been signed by and delivered to each of the Parties.

Section 10.7 Successors and Assigns. Except with respect to Sara Lee’s right to use its Affiliates or Third Party service providers to provide the Services as set forth herein, the Parties may not assign any of its rights or obligations under this Agreement to another Person without the consent of the other Party. Subject to the foregoing, this Agreement and all the terms and provisions hereof shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns.

Section 10.8 Third-Party Beneficiaries. Except for ARTICLE VII, this Agreement is solely for the benefit of the Parties and their respective successors and permitted assigns, and nothing herein express or implied shall give or be construed to give to any other Person any legal or equitable rights hereunder.

Section 10.9 Notices. All notices, requests, claims, demands and other communications required or permitted hereunder shall be in writing and shall be deemed given or delivered (a) when delivered personally, (b) if transmitted by email, on the date the recipient confirms receipt, (c) if sent by registered or certified mail, postage prepaid, return receipt requested, on the third business day after mailing or (d) if sent by nationally recognized overnight courier, on the first business day following the date of dispatch; and shall be addressed as follows:

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If to the CoffeeCo Parties prior to or on June 28, 2012, to:

D.E MASTER BLENDERS 1753 B.V. 3500 Lacey Road Downers Grove, Illinois 60515 Attention: Onno van Klinken, General Counsel Email: onno.vanklinken@demb.com

If to the CoffeeCo Parties after June 28,2012, to: D.E MASTER BLENDERS 1753 N.V. Oosterdokstraat 80 1011 DK Amsterdam, The Netherlands Attention: Onno van Klinken, General Counsel Email: onno.vanklinken@demb.com

If to Sara Lee, to: Sara Lee Corporation 3500 Lacey Road Downers Grove, Illinois 60515 Attention: Kent Magill, General Counsel Email: kent.magill@hillshirebrands.com

or to such other address as such Party may indicate by a notice delivered to the other Parties in accordance herewith.

Section 10.10 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without reference to conflict of law principles thereof.

Section 10.11 Force Majeure. Neither Party shall be deemed in default of this Agreement to the extent that any delay or failure in the performance of its obligations under this Agreement results from any cause beyond its reasonable control and without its fault or negligence, including acts of God, acts of civil or military authority, embargoes, acts of terrorism, epidemics, war, riots, insurrections, fires, explosions, earthquakes, floods, unusually severe weather conditions, labor problems or unavailability of parts, or, in the case of computer systems, any failure in electrical or air conditioning equipment. In the event of any such excused delay, the time for performance shall be extended for a period equal to the time lost by reason of the delay.

Section 10.12 Dispute Resolution. For the avoidance of doubt, the Parties’ dispute resolution obligations hereunder shall be governed by ARTICLE XII of the Master Separation Agreement.

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Section 10.13 Descriptive Headings. The descriptive headings herein are inserted for convenience of reference only and are not intended to be part of or to affect the meaning or interpretation of this Agreement.

Section 10.14 Construction. The Parties acknowledge that each Party and its counsel have reviewed and revised this Agreement and that any rule of construction to the effect that any ambiguities are to be resolved against the drafting Party shall not be employed in the interpretation of this Agreement.

Section 10.15 Relationship of the Parties. Nothing contained herein shall be deemed to create a partnership, joint venture, or similar relationship between the Parties. Neither Party is the agent, employee, joint venturer, partner, franchisee, or representative of the other Party. Each Party specifically acknowledges that it does not have the authority to, and shall not, incur any obligations or responsibilities on behalf of the other Party. Notwithstanding anything to the contrary in this Agreement, each Party (and its officers, directors, agents, employees, and members) shall not hold themselves out as employees, agents, representatives, or franchisees of the other Party or enter into any agreements on such Party’s behalf.

Section 10.16 Language. The English version of this Agreement shall be the official version. To the extent there is any inconsistency between the English version of this Agreement and any version in another language, the English version shall be controlling.

[Signature page follows]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their authorized representatives as of the date first written above.

[Signature Page to Transition Services Agreement]

SARA LEE CORPORATION

By: /s/ Mark A. GarveyName: Mark A. GarveyTitle: Executive Vice President and

Chief Financial Officer

[Signature Page to Transition Services Agreement]

DE US, INC.

By: /s/ Mark S. Silver Name: Mark S. Silver Title: President

[Signature Page to Transition Services Agreement]

D.E MASTER BLENDERS 1753 B.V.

By: /s/ Michel M.G. Cup Name: Michel M.G. Cup Title: Chief Financial Officer

Exhibit 4.15

Execution Version

TAX SHARING AGREEMENT

THIS TAX SHARING AGREEMENT, dated as June 15, 2012, by and among Sara Lee Corporation (“Sara Lee”), a Maryland corporation, by and on behalf of itself and each Affiliate of Sara Lee (as determined after the Separation), MASTER BLENDERS 1753 B.V., a private company with limited liability with corporate seat in Joure (Skarsterlân), The Netherlands, (“DutchCo”) and currently an indirect, wholly owned subsidiary of Sara Lee, and DE US, Inc., a Delaware corporation and currently a direct, wholly owned subsidiary of Sara Lee (“CoffeeCo”), by and on behalf of itself and each Affiliate of CoffeeCo (as determined after the Separation). Capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Master Separation Agreement.

RECITALS

WHEREAS, Sara Lee and its direct and indirect domestic corporate subsidiaries are members of the Sara Lee Consolidated Group;

WHEREAS, as of the date of this Agreement, CoffeeCo is a wholly-owned subsidiary of Sara Lee that is a member of the Sara Lee Consolidated Group;

WHEREAS, Sara Lee and CoffeeCo will effect the Internal Reorganization and certain related transactions described in the Master Separation Agreement for the purpose of aggregating the CoffeeCo Business in the CoffeeCo Group and separating such CoffeeCo Business from the Sara Lee Business;

WHEREAS, on the Distribution Date, Sara Lee will distribute all of the issued and outstanding shares of CoffeeCo to the holders of record on the record date of Sara Lee common stock pursuant to the Distribution and will effect the Debt Exchange;

WHEREAS, it is the intention of the Parties that the CoffeeCo Contribution, the Distribution, and the Debt Exchange qualify as a reorganization within the meaning of Sections 355, 368(a)(l)(D) and 361 of the Code;

WHEREAS, CoffeeCo will distribute on a pro rata basis to the holders of record of CoffeeCo Shares immediately after the Distribution the CoffeeCo Special Dividend after the Distribution and prior to the Merger;

WHEREAS, after the Distribution and the payment of the CoffeeCo Special Dividend, CoffeeCo will undergo the Merger;

WHEREAS, it is the intention of the Parties that the Merger qualify as a reorganization within the meaning of Section 368(a) of the Code that is Taxable to U.S. stockholders under Section 367 of the Code;

WHEREAS, in contemplation of the Separation, Sara Lee and CoffeeCo desire to set forth their agreement on the rights and obligations of Sara Lee and CoffeeCo and their respective Affiliates with respect to the responsibility, handling and allocation of federal, state, local, and foreign Taxes, and various other Tax matters.

NOW, THEREFORE, in consideration of the foregoing and the terms, conditions, covenants, and provisions of this Agreement, Sara Lee, CoffeeCo, DutchCo and their respective Affiliates (as determined after the Separation) mutually covenant and agree as follows:

ARTICLE I. DEFINITIONS

“Affiliate” means, with respect to any Person, any other Person that, at the time of determination, directly or indirectly Controls, is Controlled by or is under common Control with such Person. For purposes of this Agreement, an Affiliate of Sara Lee shall not include any entity that is, or is also, an Affiliate of CoffeeCo or DutchCo.

“After Tax Amount” means any additional amount necessary to reflect (through a gross-up mechanism) the hypothetical Tax consequences of the receipt or accrual of any payment required to be made under this Agreement (including payment of an additional amount or amounts hereunder and the effect of the deductions available for interest paid or accrued and for Taxes such as state and local Income Taxes), determined by using the highest marginal corporate Tax rate (or rates, in the case of an item that affects more than one Tax) for the relevant Taxable period (or portion thereof).

“Agreement” means this Tax Sharing Agreement, including any schedules, exhibits, and appendices attached hereto.

“Australia Coffee Distribution” means the steps pursuant to which (a) SL/DE Holdings (Australia) Pty Ltd elects to be regarded as a corporation for US federal income tax purposes and (b) Sara Lee/DE BV distributes its 100% interest in SL/DE Holdings Australia to its sole shareholder, SLI BV.

“CFC” means a “controlled foreign corporation” as defined in Section 957(a) of the Code.

“CoffeeCo Group” means DutchCo, CoffeeCo and all entities that are at least 50% owned direct or indirect subsidiaries of DutchCo or CoffeeCo immediately after the Separation, and entities that become subsidiaries thereafter.

“CoffeeCo Representation Letter” means an officer’s certificate in which certain representations, warranties and covenants are made on behalf of CoffeeCo, DutchCo and/or their Affiliates in connection with the issuance of a Tax Opinion or Tax Ruling.

“Control” means the ownership of stock or other securities possessing at least 50% of the total combined voting power of all classes of securities entitled to vote.

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“Deferred Tax Assets” means, as of a given date, the amount of deferred Tax benefits (including deferred Tax consequences attributable to deductible temporary differences and carryforwards) that would be recognized as assets on a business enterprise’s balance sheet computed in accordance with GAAP.

“Deferred Tax Liabilities” means, as of a given date, the amount of deferred tax liabilities (including deferred tax consequences attributable to deductible temporary differences) that would be recognized as liabilities on a business enterprise’s balance sheet computed in accordance with GAAP.

“Deferred Taxes” means, as of a given date, the amount of Deferred Tax Assets, less the amount of Deferred Tax Liabilities.

“Equity Award” means employee restricted stock, employee stock options, or deferred compensation granted, awarded or otherwise paid to a service provider by Sara Lee or a member of the CoffeeCo Group, as the case may be.

“Final Determination” shall mean the final resolution of liability for any Tax for a Taxable period, including any related interest, penalties or other additions to tax, (i) by Internal Revenue Service Form 870 or 870-AD (or any successor forms thereto), on the date of acceptance by or on behalf of the IRS, or by a comparable form under the laws of other jurisdictions; except that a Form 870 or 870-AD or comparable form that reserves (whether by its terms or by operation of law) the right of the taxpayer to file a claim for refund and/or the right of the Taxing Authority to assert a further deficiency with respect to a Tax Item shall not constitute a Final Determination with respect to such Tax Item; (ii) by a decision, judgment, decree, or other order by a court of competent jurisdiction, which has become final and unappealable; (iii) by a closing agreement or accepted offer in compromise under Section 7121 or Section 7122 of the Code, or comparable agreements under the laws of other jurisdictions; (iv) by any allowance of a refund or credit in respect of an overpayment of Tax, but only after the expiration of all periods during which such refund may be recovered (including by way of offset) by the jurisdiction imposing such Tax; or (v) by any other final disposition, including by reason of the expiration of the applicable statute of limitations.

“GAAP” means United States generally accepted accounting principles as in effect on the Distribution Date, and to the extent permissible, consistent with the preparation of the June 30, 2011 audited consolidated financial statements of Sara Lee and its Affiliates.

“Income Taxes” means all federal, state, local and foreign income Taxes or other Taxes based on income or net worth.

“Indemnified Party” has the meaning prescribed in Section 6.02.

“Indemnifying Party” has the meaning prescribed in Section 6.02.

“IRS Submission” means the Ruling Request and any supplemental materials or requests submitted to the IRS relating to the Ruling Request, CoffeeCo Contribution, the Distribution, the Debt Exchange, the Merger, or the Separation, to the extent that (A) if filed by any member of the Sara Lee Group, such supplemental material (i) includes statements or representations

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relating to facts that were, are or will be under the control of DutchCo, CoffeeCo or any of their Affiliates or (ii) is relevant to, or creates, any actual or potential obligations of, or limitations on, DutchCo, CoffeeCo or any of their Affiliates, and (B) if filed by any member of the CoffeeCo Group, such supplemental material (i) includes statements or representations relating to facts that were, are or will be under the control of Sara Lee or any of its Affiliates or (ii) is relevant to, or creates, any actual or potential obligations of, or limitations on, Sara Lee or any of its Affiliates.

“Other Taxes” means all taxes other than Income Taxes, including (but not limited to) transfer, sales, use, payroll, property, and unemployment Taxes.

“Party” means Sara Lee, CoffeeCo or DutchCo, as applicable. For purposes of this agreement, unless the context otherwise requires, Party also refers to an Affiliate of the relevant Party.

“Person” means any natural person, corporation, general partnership, limited partnership, limited liability company, limited liability partnership, proprietorship, trust, association, union, governmental authority or other entity, enterprise, authority or organization.

“Post-Distribution Period” means any Tax year or other Taxable period beginning after the Distribution Date and, in the case of any Straddle Period, that part of the Tax year or other Taxable period that begins at the beginning of the day after the Distribution Date. By way of example, if the Distribution Date were to occur on July 31, 2012, then for U.S. federal income Tax purposes, the Taxable year beginning August 1, 2012 would constitute a Post-Distribution Period with respect to the members of the CoffeeCo Group immediately after the Distribution Date.

“Pre–Distribution Period” means any Tax year or other Taxable period that ends on or before the Distribution Date and, in the case of any Straddle Period, that part of the Tax year or other Taxable period through the end of the day on the Distribution Date. By way of example, if the Distribution Date were to occur on July 31, 2012, then for U.S. federal income Tax purposes the period from July 1, 2012 through July 31, 2012 would constitute a Pre-Distribution Period with respect to the members of the CoffeeCo Group immediately after the Distribution Date, even though the Taxable income of those corporations for such Pre-Distribution Period is includable on the Sara Lee Consolidated Group’s Tax Return for that Group’s Taxable year ending June 30, 2013.

“Post-Exchange Restructuring” means certain internal restructuring transactions contemplated by CoffeeCo to occur following the Merger, as described in the Ruling Request. For this purpose, the Post-Exchange Restructuring includes all actions and transaction steps undertaken by or on behalf of a member of the CoffeeCo Group in connection with the Separation following the Distribution.

“Representation Letters” means the CoffeeCo Representation Letter (or Letters) and the Sara Lee Representation Letter (or Letters).

“Responsible Party” has the meaning prescribed in Section 5.04(a).

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“Ruling Documents” means the Ruling Request, the appendices, attachments and exhibits thereto, and any additional or supplemental information submitted to the IRS in connection with the Ruling Request and the Tax Ruling.

“Ruling Request” means the private letter ruling request filed by Sara Lee with the IRS dated May 26, 2011 pertaining to certain Tax aspects of the CoffeeCo Contribution, the Distribution and the Debt Exchange, and any supplemental submissions related thereto.

“Sara Lee Consolidated Group” means the affiliated group of corporations (within the meaning of Section 1504 of the Code) of which Sara Lee is the common parent prior to the Distribution Date.

“Sara Lee Group” means all entities that are at least 50% owned direct or indirect subsidiaries of Sara Lee immediately after the Separation, and entities that become subsidiaries thereafter.

“Sara Lee Representation Letter” means an officer’s certificate in which certain representations, warranties and covenants are made on behalf of Sara Lee and its Affiliates in connection with the issuance of a Tax Opinion or Tax Ruling.

“Separation Taxes” means (i) any U.S. federal tax imposed on or assessed against Sara Lee or the Sara Lee Group resulting from Steps 2(j) and 3-5 of the Internal Reorganization, the Debt Exchange, the Distribution and the Merger, (ii) any U.S. federal tax imposed on or assessed against CoffeeCo or the CoffeeCo Group resulting from the CoffeeCo Special Dividend, the Special Dividend Financing and the repayment thereof with any related borrowing undertaken by DEMB International BV, and (iii) any U.S. federal tax imposed on or assessed against Sara Lee, the Sara Lee Group, CoffeeCo or the CoffeeCo Group, resulting from any SL/DE BV Top-Up Dividend. For the avoidance of doubt, Separation Taxes shall not include any Taxes imposed on or assessed against any member of the CoffeeCo Group in connection with the Post-Exchange Restructuring notwithstanding any involvement on the part of Sara Lee or a member of the Sara Lee Group in the description, disclosure, documentation or execution of any portion of the Post-Exchange Restructuring, other than as specifically set forth in clause (ii), above.

“SL/DE BV Top-Up Dividend” means a distribution from Sara Lee/DE BV (Netherlands) to CoffeeCo that is (i) Taxable as a dividend under Section 301(c)(l) of the Code, (ii) made after the Distribution and before the close of CoffeeCo’s Taxable year beginning on the date of the Distribution, and (iii) in an amount, if any, necessary, to cause the entire amount of the CoffeeCo Special Dividend to be paid out of CoffeeCo’s earnings and profits.

“Straddle Period” means, with respect to a given entity, any state, local, or foreign Taxable period beginning on or before the Distribution Date and ending after the Distribution Date; provided, however, that for the avoidance of doubt, the term “Straddle Period” shall not include any U.S. federal income Taxable period of the Sara Lee Consolidated Group or Sara Lee Group.

“Tax” and “Taxes” mean any form of taxation, whenever created or imposed, and whenever imposed by a Taxing Authority, and without limiting the generality of the foregoing, shall include any net income, alternative or add-on minimum tax, gross income, sales, use, ad valorem, gross receipts, value added, franchise, profits, license, transfer, recording, withholding, payroll, employment, excise, severance, stamp, occupation, premium, property, windfall profit,

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custom duty, annual report, or other tax, government fee, or other like assessment or charge, of any kind whatsoever, together with any related interest, penalties, or other additions to tax, or additional amount imposed by any such Taxing Authority; provided, however, that “Tax” and “Taxes” shall not include any amount owed to a federal, state, local, or foreign government under the laws governing unclaimed property or escheat.

“Tax Asset” means any Tax Item that has accrued for Tax purposes (including a net operating loss, net capital loss, investment tax credit, foreign tax credit, charitable contribution deduction, credit related to alternative minimum tax and any other Tax credit), that could reduce a Tax in the Taxable period in which it accrued, but which is available to reduce a Tax in a later Taxable period.

“Taxing Authority” means any national, municipal, governmental, state, federal, foreign, or other body, or any quasi-governmental or private body, having jurisdiction over the assessment, determination, collection or imposition of any Tax (including the IRS).

“Tax Benefit” means, without double counting, the sum of (i) the amount of the reduction in the Tax liability of an entity (or of the consolidated or combined group of which it is a member), whether temporary or permanent, for any Taxable period that arises, or may arise in the future, as a result of any adjustment to, or addition or deletion of, a Tax Item in the computation of the Tax liability of the entity (or the consolidated or combined group of which it is a member), and (ii) the amount by which the entity’s (or consolidated or combined group of which it is a member) Deferred Taxes are decreased as a result of such adjustment, addition, or deletion.

“Tax Controversy” has the meaning prescribed in Section 5.01.

“Tax Detriment” means, without double counting, the sum of (i) the amount of the increase in the Tax liability of an entity (or of the consolidated or combined group of which it is a member), whether temporary or permanent, for any Taxable period that arises, or may arise in the future, as a result of any adjustment to, or addition or deletion of, a Tax Item in the computation of the Tax liability of the entity (or the consolidated or combined group of which it is a member), and (ii) the amount by which the entity’s (or consolidated or combined group of which it is a member) Deferred Taxes are increased as a result of such adjustment, addition, or deletion.

“Tax Item” means any item of income, gain, loss, deduction, credit, recapture of credit, or any other item (including the basis or adjusted basis of property) which increases or decreases Income Taxes paid or payable in any Taxable period.

“Tax Opinion” means an opinion issued to Sara Lee by a law firm or an accounting firm with respect to the qualification of (A) the Australia Coffee Distribution as a reorganization within the meaning of Sections 368(a)(l)(D) and 355 of the Code, (B) the CoffeeCo Contribution, the Distribution, and the Debt Exchange as a reorganization within the meaning of Sections 355(a), 368(a)(l)(D) and 361 of the Code, (C) the CoffeeCo Special Dividend as being treated as paid by CoffeeCo out of its own funds to holders of record, or (D) the Merger as a reorganization within the meaning of Section 368 of the Code that is Taxable to U.S. stockholders under Section 367 of the Code, as applicable.

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“Tax Representations” means all representations made by Sara Lee, CoffeeCo, DutchCo and their respective Affiliates in connection with this Agreement, the IRS Submission, the Ruling Documents, the Tax Ruling, the Tax Opinion and the Representation Letters.

“Tax Return” means any return, filing, questionnaire or other document required to be filed, including requests for extensions of time, filings made with estimated Tax payments, claims for refund or amended returns, that may be filed for any Taxable period with any Taxing Authority in connection with any Tax or Taxes (whether or not a payment is required to be made with respect to such filing).

“Tax Ruling” means the IRS private letter ruling issued to Sara Lee in FY 2012 in connection with the Ruling Request.

“Treasury Regulations” means the final and temporary (but not proposed) income tax regulations promulgated under the Code, as such regulations may be amended from time to time (including corresponding provisions of succeeding regulations).

ARTICLE II. RESPONSIBILITY FOR TAXES

2.01 Responsibility and Indemnification for Taxes.

(a) From and after the Distribution Date, without duplication, each of Sara Lee and CoffeeCo shall be responsible for, and shall pay its respective share of the liability for Taxes of Sara Lee, CoffeeCo and their respective Affiliates, as provided in this Agreement. Sara Lee and its Affiliates shall indemnify and hold harmless CoffeeCo and its Affiliates from any Taxes for which Sara Lee is responsible pursuant to this Agreement. CoffeeCo and its Affiliates shall indemnify and hold harmless Sara Lee and its Affiliates from any Taxes for which CoffeeCo is responsible pursuant to this Agreement.

(b) For the avoidance of doubt, all references to Taxes or Tax liabilities in this agreement refer to the actual amounts of Taxes paid or due and do not apply to items or adjustments to items shown solely on a Party’s balance sheet or other financial statement. There shall be no adjustments, payments or obligations among the Parties made pursuant to this agreement for any gains or losses with respect to amounts shown on a Party’s balance sheet or other financial statements and not specifically allocated herein, including but not limited to FIN 48 reserves, Deferred Tax Assets, Deferred Tax Liabilities and other Tax accounting entries.

(c) Payments to Taxing Authorities and between the Parties, as the case may be, shall be made in accordance with the provisions of this Agreement.

2.02 Income Taxes.

(a) Generally

(i) Sara Lee.

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Except as set forth in Sections 2.02(a)(ii), (a)(iii), (a)(iv) and 2.02(b), Sara Lee shall be responsible for and shall indemnify and hold CoffeeCo and its Affiliates harmless from and against:

(A) all U.S. federal Income Tax liability imposed on members of the Sara Lee Group or the CoffeeCo Group for all Pre-Distribution Periods,

(B) any state and local Income Tax liability (whether consolidated, combined, unitary or separate) imposed on members of the Sara Lee Group or the CoffeeCo Group for all Pre- Distribution Periods,

(C) all U.S. federal, state and local Income Tax liability imposed on members of the Sara Lee Group for all Post-Distribution Periods,

(D) any Other Taxes referred to in Section 2.03(a),

(E) any non-U.S. Income Taxes attributable to a member of the Sara Lee Group for all Taxable periods,

(F) any U.S. federal Income Tax liability through fiscal year 2012 that is attributable to a loan made or outstanding between any member of any of the Sara Lee Group or CoffeeCo Group that is subject to Section 956 of the Code (a “Section 956 Loan”), and

(G) any Tax liability or contractual liability for an indemnity obligation relating to Taxes in respect of the dispositions or other transactions listed on Schedule 1.

(ii) CoffeeCo.

Except as set forth in Sections 2.02(a)(i), (a)(iii) and 2.02(b), the CoffeeCo Group shall be responsible for and shall indemnify and hold Sara Lee and its Affiliates harmless from and against

(A) any Other Taxes referred to in Section 2.03(b),

(B) any non-U.S. Income Taxes that are attributable to members of the CoffeeCo Group for all Taxable periods, including any non-U.S. Income Taxes attributable to the Internal Reorganization,

(C) all U.S. federal, state and local Income Tax liability (whether consolidated, combined, unitary or separate) of a member of the CoffeeCo Group for a Post-Distribution Period (which, for the avoidance of doubt, includes all U.S. federal and state Income Taxes imposed on or attributable to a member of the CoffeeCo Group in connection with the Merger and the Post-Exchange Restructuring) and

(D) any Tax liability or contractual liability for an indemnity obligation relating to Taxes in respect of dispositions or other transactions listed on Schedule 2.

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(iii) Subpart F.

All U.S. federal Income Taxes arising under Section 951(a) of the Code (or any similar provision of state, local or foreign law) (including any tax resulting from an investment in United States property and subject to pro-ration as required by law) as a result of any member of the Sara Lee Group or the CoffeeCo Group being a United States shareholder (within the meaning of Section 951(b) of the Code or a similar provision of state, local or foreign law) during Sara Lee’s 2012 fiscal year, shall be the responsibility of the Party on which such Taxes are imposed by law (excluding for this purpose, any liability imposed on such Party solely as a result of being part of the Sara Lee Consolidated Group by operation of Treasury Regulation § 1.1502-6), except to the extent that such U.S. federal Income Taxes is attributable to (X) a Section 956 Loan (as described in Section 2.02(a)(i)(F) above), in which case liability shall be allocated to Sara Lee pursuant to Section 2.02(a)(i)(F) or (Y) redemption premium paid to DEF Finance S.N.C. in connection with the Debt Exchange to the extent that the payment of any such redemption premium generates a current deduction for Sara Lee, in which case liability shall be allocated to Sara Lee to the extent of Sara Lee’s current deduction.

(iv) Post-Exchange Restructuring.

Except as set forth specifically in clause (ii) of the definition of Separation Taxes, the CoffeeCo Group shall be responsible for and shall indemnify and hold Sara Lee and its Affiliates harmless from and against any liability for Taxes that arises in connection with the Post-Exchange Restructuring.

(b) Separation Taxes

(i) Sara Lee.

The Sara Lee Group shall be responsible for and shall indemnify and hold CoffeeCo and its Affiliates harmless from and against

(A) 50% of all Separation Taxes not due to any act, failure to act or omission identified in this subsection (b) on the part of any member of the CoffeeCo Group or the Sara Lee Group, or any Separation Tax liability arising out of or in connection with the accuracy of any description of events, facts or circumstances on or prior to the Distribution Date as contained in or made in connection with the Ruling Request, the Ruling Documents, the Tax Ruling, the Tax Opinion, or other Transaction Agreements, including any misrepresentation or omission by Sara Lee, CoffeeCo or DutchCo contained in any such document with respect to any period prior to the Distribution, but excluding in each case for this purpose any statement concerning a Party’s plan or intention with respect to actions or operations after the Distribution Date,

(B) 100% of all Separation Taxes arising out of, based upon or relating or attributable to any breach by Sara Lee of any representation, warranty, covenant or obligation contained in this Agreement, any other Transaction Agreement, the Ruling Request, the Ruling Documents, the Tax Opinion, any Sara Lee Representation Letter, or otherwise made in connection with the Separation, but excluding for this purpose the breach of any representations (including those described in Section 4.01(b)(i)) not concerning a Party’s plan or intention with respect to actions or operations after the Distribution Date and

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(C) 100% of all Separation Taxes arising from any event following the Separation involving the stock or assets of Sara Lee or any of its Affiliates which causes the Distribution to be a Taxable event to Sara Lee as a result of the application of Section 355(e) of the Code or a similar provision of state or local Tax law.

(ii) CoffeeCo.

The CoffeeCo Group shall be responsible for and shall indemnify and hold Sara Lee and its Affiliates harmless from and against

(A) 50% of any Separation Taxes that are not due to any act, failure to act or omission identified in this subsection (b) on the part of any member of the CoffeeCo Group or the Sara Lee Group, or any Separation Tax liability arising out of or in connection with the accuracy of any description of events, facts or circumstances on or prior to the Distribution Date as contained in or made in connection with the Ruling Request, the Ruling Documents, the Tax Ruling, the Tax Opinion, or other Transaction Agreements, including any misrepresentation or omission by Sara Lee, CoffeeCo or DutchCo contained in any such document with respect to any period prior to the Distribution, but excluding in each case for this purpose any statement concerning a Party’s plan or intention with respect to actions or operations after the Distribution Date,

(B) 100% of all Separation Taxes arising out of, based upon or relating or attributable to any breach by CoffeeCo or DutchCo of any representation, warranty, covenant or obligation contained in this Agreement, any other Transaction Agreement, the Ruling Request, the Ruling Documents, the Tax Opinion, any CoffeeCo Representation Letter, or otherwise made by CoffeeCo or DutchCo in connection with the Separation, but excluding for this purpose the breach of any representations (including those described in Section 4.01(a)(i)) not concerning a Party’s plan or intention with respect to actions or operations after the Distribution Date, and

(C) 100% of all Separation Taxes arising from any event post-Distribution involving the stock or assets of DutchCo or CoffeeCo or any of their Affiliates which causes the Distribution to be a Taxable event to Sara Lee as a result of the application of Section 355(e) of the Code or a similar provision of state or local Tax law.

2.03 Other Taxes

(a) Sara Lee shall be responsible for and shall pay, or cause the appropriate member of the Sara Lee Group to pay, any Other Taxes attributable to members of the Sara Lee Group for all Taxable periods.

(b) CoffeeCo shall be liable for and shall pay, or cause the appropriate member of the CoffeeCo Group to pay, any Other Taxes attributable to members of the CoffeeCo Group for all Taxable periods.

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2.04 Allocation of Certain Income Taxes and Income Tax Items.

(a) If Sara Lee, CoffeeCo or any of their respective Affiliates is permitted but not required under applicable U.S. federal, state, local or foreign Tax laws to treat the Distribution Date as the last day of a Taxable period, then the Parties shall treat such day as the last day of a Taxable period under such applicable Tax law, and shall file any elections necessary or appropriate to such treatment; provided that this Section 2.4(a) shall not be construed to require Sara Lee to change its Taxable year.

(b) Subject to section 2.04(c), below, Sara Lee in its sole discretion shall allocate Tax attributes determined on a consolidated or combined basis for Taxable periods ending before or including the Distribution Date between the Sara Lee Group and the CoffeeCo Group. Sara Lee and CoffeeCo shall compute their Tax liabilities for Taxable periods beginning after the Distribution Date consistent with such determination, and shall treat the Tax Assets and Tax Items as reflected on any federal (or applicable state, local or foreign) Income Tax Return filed by the Parties as presumptively correct.

(c) The Parties agree that, in connection with the Distribution, Sara Lee’s current and accumulated earnings and profits will be allocated between Sara Lee and CoffeeCo based on their relative fair market values at the time of the Distribution in accordance with Treasury Regulation § 1.312-10.

2.05 Treatment of Restricted Stock, Stock Options, and Deferred Compensation.

(a) To the extent permitted by law, Sara Lee (or the appropriate Affiliate of Sara Lee) shall be entitled to and shall claim all U.S. Tax deductions or other U.S. Tax benefits resulting from the grant of any Equity Awards prior to the Distribution.

(b) To the extent permitted by law, with respect to Equity Awards granted after the Distribution Date, the Party that grants the award shall be entitled to claim any Tax deduction or other benefit resulting from the grant and/or vesting of the award.

(c) If, pursuant to a Final Determination, all or any part of a Tax deduction claimed by Sara Lee pursuant to Section 2.05(a) is disallowed, then, to the extent permitted by law, the other Party (or Affiliate thereof) shall claim such Tax deduction. If such other Party (or Affiliate thereof) realizes a Tax Benefit from the claiming of such Tax deduction, such other Party (or Affiliate) shall pay the amount of such Tax Benefit (net of any Tax Detriment suffered by the payer) to the Party that originally claimed the Tax deduction.

(d) Sara Lee shall withhold applicable Taxes and satisfy applicable Tax reporting obligations with respect to the taxation of the Equity Awards referred to in Section 2.05(a). The Party granting the award and claiming the deduction shall withhold applicable Taxes and satisfy applicable Tax reporting obligations with respect to the taxation of the Equity Awards referred to in Section 2.05(b). The Parties to this Agreement shall cooperate so as to permit the Party initially claiming such deduction to discharge any applicable Tax withholding and Tax reporting obligations.

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2.06 Tax Refunds. Except as provided in Section 2.05(c), the benefit of any Tax credits, Tax attributes and any refund or credit of any overpayment of Taxes or estimated Tax liabilities, including any corresponding benefit arising out of or related to any Tax liability that is the subject of this Agreement, will remain with the Party entitled to the benefit under applicable Tax law, as modified by any applicable audit agreements or past practice of Sara Lee and its Affiliates. No payments shall be made between the Parties to account for such adjustment.

ARTICLE III. TAX RETURNS AND INFORMATION EXCHANGE

3.01 Tax Return Preparation Responsibility; Payment of Taxes Shown Thereon.

(a) Sara Lee shall prepare and file all (i) U.S. federal, state and foreign consolidated, combined, affiliated, unitary or similar Income Tax Returns required to be filed by any member of the Sara Lee Group or the CoffeeCo Group for all Pre-Distribution Periods and Straddle Periods (and including any such combined Returns or informational reporting forms, such as Form 5471) required to be filed for periods that begin prior to the Distribution; (ii) all separate state, local and foreign Income Tax Returns and all Other Tax Returns for all members of the Sara Lee Group for all Tax periods; and (iii) all Tax Returns for all members of the Sara Lee Group for all Post-Distribution Tax Periods.

(b) CoffeeCo or its Affiliates shall timely prepare, or cause to be prepared, at its sole cost, and forward to Sara Lee for review, comment, and, where applicable, filing, pro forma Tax Returns for all members of the CoffeeCo Group for Pre-Distribution Periods in such form and at such times as Sara Lee may reasonably request, including Form 5471 and other applicable informational reporting forms with respect to Pre-Distribution Periods.

(c) To the extent that there are separate state, local or foreign Tax Returns attributable to a member of the Sara Lee Group required to be filed by members of the CoffeeCo group with respect to Pre-Distribution Periods, CoffeeCo and Sara Lee shall cooperate to ensure that such returns are correctly filed by the Party required by law.

(d) CoffeeCo or its Affiliates shall prepare and file (i) all Other Tax Returns for all members of the CoffeeCo Group for all Tax periods; (ii) all non-U.S. Income Tax Returns for all members of the CoffeeCo Group for all Tax periods, and (iii) all Tax Returns for all members of the CoffeeCo Group for all Post-Distribution Periods.

(e) Subject to the written direction of Sara Lee, after the date of the Distribution, CoffeeCo shall not file (or allow any Affiliate of CoffeeCo to file) any amended Tax Return or refund claim for any Pre-Distribution Tax Period.

(f) Sara Lee and its Affiliates shall be responsible for the remitting of payment of any Taxes shown on a Tax Return for which it is responsible for the filing thereof. CoffeeCo and its Affiliates shall be responsible for the remitting of payment of any Taxes shown on a Tax Return for which it is responsible for the filing thereof.

(g) If Sara Lee remits a Tax payment pursuant to Section 3.01(f), but CoffeeCo is responsible pursuant to Article II for all or a portion of the Tax shown on the applicable Tax Return, then CoffeeCo shall pay to Sara Lee that portion of the Tax for which

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CoffeeCo is responsible. If CoffeeCo remits a Tax payment pursuant to Section 3.01(f), but Sara Lee is responsible pursuant to Article II for all or a portion of the Tax shown on the applicable Tax Return, then Sara Lee shall pay to CoffeeCo that portion of the Tax for which Sara Lee is responsible. Such payments shall be requested and made in accordance with the notice and payment provisions contained in Sections 6.02 and 6.03. Nothing in this Section 3.01 shall affect the allocation of responsibility for Taxes as set forth in Article II.

3.02 Certain Items Related to Tax Return Preparation.

(a) All Tax Returns related a Pre-Distribution Tax Period shall be prepared and filed by the specified Party in a manner consistent with past Tax reporting practices with respect to the CoffeeCo Business.

(b) Unless otherwise required by a Taxing Authority, the Parties hereby agree to prepare and file all Tax Returns, and to take all other actions, in a manner consistent with this Agreement, the Transition Services Agreement and the Master Separation Agreement, applicable law, the Tax Ruling, Ruling Documents, the Ruling Request, the Tax Opinion, and any Representation Letter. All Tax Returns shall be filed on a timely basis (taking into account applicable extensions) by the Party responsible for filing such Tax Returns under this Agreement; provided, that if a Tax Return is to be signed by an officer of a company different from the Party responsible for filing such Tax Return, each Party hereto shall have (or cause its Affiliate to have) the appropriate officer sign such Tax Return promptly after presentation thereof for signature.

(c) Except as otherwise specifically provided for in this Agreement, Sara Lee shall have the exclusive right, in its reasonable discretion, with respect to any Tax Return for which it is (or has elected to become) responsible for the filing thereof pursuant to this Agreement, to determine (i) the manner in which such Tax Return shall be prepared and filed, including the accounting methods, positions, conventions and principles of taxation to be used and the manner in which any Tax Item shall be reported; (ii) whether any extensions may be requested; (iii) the election(s) that will be made by Sara Lee, any Affiliate of Sara Lee, CoffeeCo, or any Affiliate of CoffeeCo on such Tax Return; (iv) whether any amended Tax Return(s) shall be filed; (v) whether any claim(s) for refund shall be made; (vi) whether any refund shall be paid by way of refund or credited against any liability for the related Tax; and (vii) whether to retain outside firms to prepare or review such Tax Returns; provided, that Sara Lee shall prepare all Tax Returns for which it has (or has assumed) filing responsibility, to the extent such Tax Returns reflect activities of the CoffeeCo Business, in a manner consistent with past Tax reporting practices with respect to the CoffeeCo Business, except as required by law or regulation.

(d) Within 90 calendar days after filing the U.S. federal income Tax Return for the Sara Lee Consolidated Group for the Tax year that includes the Distribution Date, at the written request of CoffeeCo, Sara Lee shall notify CoffeeCo of the Tax attributes associated with CoffeeCo and each of its Affiliates, and the Tax bases of the assets and liabilities, transferred to CoffeeCo in connection with the CoffeeCo Contribution and the Distribution. Sara Lee shall advise CoffeeCo with respect to any Final Determination of Tax adjustments relating to the Sara Lee Consolidated Group if such Final Determination of Tax adjustments may affect any Tax attribute of any member of the CoffeeCo Group after the Distribution Date within 90 calendar days after such change is made or there is a Final Determination of such change.

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(e) Nothing in this Agreement shall be construed as a guarantee or representation of the existence or amount of any loss, credit, carryforward, basis or other Tax Item or Tax Asset, whether past, present or future, of Sara Lee, CoffeeCo, or their respective Affiliates.

ARTICLE IV. TAX TREATMENT OF THE DISTRIBUTION

4.01 Representations.

(a) CoffeeCo and DutchCo. (i) Ruling Documents. CoffeeCo and DutchCo hereby represent and warrant that (i) they have examined the Ruling

Documents (including, without limitation, the representations to the extent that they relate to the plans, proposals, intentions, and policies of CoffeeCo, the CoffeeCo Group, or the CoffeeCo Business, including the Australia Coffee Business), and (ii) to the extent in reference to DutchCo, CoffeeCo, the CoffeeCo Group, or the CoffeeCo Business, including the Australia Coffee Business, the facts presented and the representations made therein are true, correct, and complete.

(ii) Tax-Free Status. CoffeeCo hereby represents and warrants that it has no plan or intention of taking any action, or failing or omitting to take any action, or knows of any circumstance, that could reasonably be expected to (i) cause the CoffeeCo Contribution, the Distribution and the Debt Exchange to fail to qualify as a reorganization within the meaning of Sections 355, 368 and 361 of the Code, (ii) cause the Merger to fail to qualify as a reorganization within the meaning of Section 368 of the Code that is Taxable to U.S. stockholders under Section 367 of the Code, or (iii) cause any representation or factual statement made in this Agreement, the Separation Agreement and the other Transaction Agreements, the Ruling Request, the Ruling Documents, the Tax Ruling, the Tax Opinion, or any CoffeeCo Representation Letter, as applicable, to be untrue in a manner that would have an adverse effect on the qualification of the CoffeeCo Contribution, the Distribution and the Debt Exchange as a reorganization within the meaning of Sections 355, 368 and 361 of the Code, the qualification Merger as a reorganization within the meaning of Section 368 of the Code that is Taxable to U.S. stockholders under Section 367 of the Code, or the tax treatment described in the Tax Opinion of certain aspects of the Internal Reorganization and the CoffeeCo Special Dividend.

(iii) Plan or Series of Related Transactions. (A) CoffeeCo hereby represents and warrants that, to the knowledge of CoffeeCo and the management of CoffeeCo,

neither the Distribution nor any related transactions are part of a plan (or series of related transactions) pursuant to which a Person will acquire stock representing a 50% or greater interest (within the meaning of Sections 355(d) and (e) of the Code) in CoffeeCo or any successor to CoffeeCo, with the exception of the acquisition of the stock of CoffeeCo by DutchCo pursuant to the Merger.

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(B) CoffeeCo and DutchCo have no plan or intention to participate in, facilitate, undertake or otherwise permit any acquisition of DutchCo or CoffeeCo after the Distribution and the Merger (other than the acquisition of CoffeeCo by DutchCo or the acquisition of DutchCo by CoffeeCo’s public shareholders pursuant to the Merger), pursuant to which a direct or indirect acquisition of stock of DutchCo or CoffeeCo would occur, which would result in a direct or indirect acquisition of stock representing a 50% or greater interest (within the meaning of Sections 355(e) and 355(d)(4) of the Code) in DutchCo or CoffeeCo (including any predecessor or successor of any such corporation).

(iv) CoffeeCo and its Affiliates have no plan or intention to redeem, purchase or otherwise reacquire more than 20% of the capital stock of CoffeeCo or DutchCo in one or more transactions following the Distribution Date.

(v) CoffeeCo and its Affiliates have no plan or intention to (i) sell, exchange, distribute or otherwise dispose of, other than in the ordinary course of business, all or a substantial part of the assets of any of the trades or businesses relied upon in the Tax Ruling or Tax Opinion to satisfy Section 355(b) of the Code; (ii) discontinue or cause to be discontinued the active conduct of any of the trades or businesses relied upon in the Tax Ruling or Tax Opinion to satisfy Section 355(b) of the Code; or (iii) cause the occurrence of any restructuring pursuant to which CoffeeCo ceases to be treated as conducting the trade or businesses relied upon in the Tax Ruling or Tax Opinion to satisfy Section 355(b) of the Code.

(vi) DutchCo and its Affiliates have no plan or intention to (i) liquidate CoffeeCo; (ii) merge CoffeeCo with any other corporation; or (iii) sell or otherwise dispose of any assets of CoffeeCo and its subsidiaries except in the ordinary course of business and in connection with the Post-Exchange Restructuring.

(vii) CoffeeCo and its Affiliates have no plan or intention to, and CoffeeCo does not expect that it or any of its Affiliates (including DutchCo) will, directly or indirectly, modify, reprice, repay, pre-pay, pay down, redeem, retire, defease or otherwise acquire, however effected, any of the Controlled Securities, as defined in the Ruling Request, including those held by Affiliates of CoffeeCo, prior to their stated maturity date.

(b) Sara Lee. (i) Ruling Documents. Sara Lee hereby represents and warrants that (i) it has examined the Ruling Documents

(including, without limitation, the representations to the extent that they relate to the plans, proposals, intentions, and policies of Sara Lee, the Sara Lee Group, or the Sara Lee Business), and (ii) to the extent in reference to Sara Lee, the Sara Lee Group, or the Sara Lee Business, the facts presented and the representations made therein are true, correct, and complete.

(ii) Tax-Free Status. Sara Lee hereby represents and warrants that it has no plan or intention of taking any action, or failing or omitting to take any action, or knows of any circumstance, that could reasonably be expected to (i) cause the CoffeeCo

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Contribution, the Distribution and the Debt Exchange to fail to qualify as a reorganization within the meaning of Sections 355, 368 and 361 of the Code, (ii) cause the Merger to fail to qualify as a reorganization within the meaning of Section 368 of the Code that is Taxable to U.S. stockholders under Section 367 of the Code, or (iii) cause any representation or factual statement made in this Agreement, the Separation Agreement and the other Transaction Agreements, the Ruling Request, the Ruling Documents, the Tax Ruling, the Tax Opinion, or any CoffeeCo Representation Letter, as applicable, to be untrue in a manner that would have an adverse effect on the qualification of the CoffeeCo Contribution, the Distribution and the Debt Exchange as a reorganization within the meaning of Sections 355, 368 and 361 of the Code, the qualification of the Merger as a reorganization within the meaning of Section 368 of the Code that is Taxable to U.S. stockholders under Section 367 of the Code, or the tax treatment described in the Tax Opinion of certain aspects of the Internal Reorganization and the CoffeeCo Special Dividend.

(iii) Plan or Series of Related Transactions. (A) Sara Lee hereby represents and warrants that, to the knowledge of Sara Lee and the management of Sara Lee, neither

the Distribution nor any related transactions are part of a plan (or series of related transactions) pursuant to which a Person will acquire stock representing a 50% or greater interest (within the meaning of Sections 355(d) and (e) of the Code) in Sara Lee or any successor to Sara Lee.

(B) Sara Lee has no plan or intention to participate in, facilitate, undertake or otherwise permit any acquisition of Sara Lee after the Distribution and the Merger, pursuant to which a direct or indirect acquisition of stock of Sara Lee would occur, which would result in a direct or indirect acquisition of stock representing a 50% or greater interest (within the meaning of Sections 355(e) and 355(d)(4) of the Code) in Sara Lee (including any predecessor or successor of any such corporation).

(iv) Sara Lee and its Affiliates have no plan or intention to redeem, purchase or otherwise reacquire more than 20% of its capital stock in one or more transactions following the Distribution Date.

(v) Sara Lee and its Affiliates have no plan or intention to (i) sell, exchange, distribute or otherwise dispose of, other than in the ordinary course of business, all or a substantial part of the assets of any of the trades or businesses relied upon in the Tax Ruling to satisfy Section 355(b) of the Code; or (ii) discontinue or cause to be discontinued the active conduct of any of the trades or businesses relied upon in the Tax Ruling to satisfy Section 355(b) of the Code.

4.02 Covenants.

(a) The Parties shall not, and shall cause their Affiliates not to take any action that, or fail to take any action the failure of which, would be inconsistent with or have an adverse effect on the qualification of the CoffeeCo Contribution, the Distribution and the Debt Exchange as a reorganization within the meaning of Sections 355, 368 and 361 of the Code, the

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qualification of the Merger as a reorganization within the meaning of Section 368 of the Code that is Taxable to U.S. stockholders under Section 367 of the Code or the tax treatment described in the Tax Opinion of certain aspects of the Internal Reorganization and the CoffeeCo Special Dividend.

(b) Unless otherwise required by a Taxing Authority or applicable law, the Parties hereby agree to prepare and file all Tax Returns, and to take all other actions, in a manner consistent with past practice.

(c) Unless otherwise required by a Taxing Authority or applicable law, the Parties hereby agree to prepare and file all Tax Returns, and to take all other actions, in a manner consistent with the characterization of the Separation as described in the Ruling Request, the Ruling Documents, the Tax Ruling, the Tax Opinion(s) and the Transaction Agreements.

(d) Actions Consistent with Representations and Covenants. (i) CoffeeCo shall not (and shall not permit any of its Affiliates or grant or permit any of its Affiliates to grant implicit

or explicit permission to any other person to) take any action, and CoffeeCo shall not (and shall not permit any of its Affiliates or grant or permit any of its Affiliates to grant implicit or explicit permission to any other person to) fail to take any action, where such action or failure to act would be inconsistent with or cause to be untrue any material, information, covenant, or representation in this Agreement, the Master Separation Agreement and the other Transaction Agreements, theTax Ruling, the Ruling Request, the Ruling Documents (including, without limitation, the representations to the extent that they relate to the plans, proposals, intentions, and policies of CoffeeCo, Affiliates of CoffeeCo, or the CoffeeCo Business), the Tax Opinions, or any CoffeeCo Representation Letter.

(ii) Sara Lee shall not (and shall not permit any of its Affiliates or grant or permit any of its Affiliates to grant implicit or explicit permission to any other person to) take any action, and Sara Lee shall not (and shall not permit any of its Affiliates or grant or permit any of its Affiliates to grant implicit or explicit permission to any other person to) fail to take any action, where such action or failure to act would be inconsistent with or cause to be untrue any material, information, covenant, or representation in this Agreement, the Master Separation Agreement and the other Transaction Agreements, theTax Ruling, the Ruling Request, the Ruling Documents (including, without limitation, the representations to the extent that they relate to the plans, proposals, intentions, and policies of Sara Lee, Affiliates of Sara Lee, or the Sara Lee Business), the Tax Opinions, or any Sara Lee Representation Letter.

(e) CoffeeCo shall cause Sara Lee/DE BV (Netherlands) to distribute the SL/DE BV Top-Up Dividend.

4.03 IRS Submissions.

(a) No IRS Submission shall be filed by Sara Lee, with the IRS unless, prior to such filing, CoffeeCo has agreed as to the contents of such IRS Submission; provided, however, that if the IRS requests same-day filing of an IRS Submission that does not include any

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material issue or statement, then Sara Lee is required only to make a good faith effort to notify DutchCo’s representatives and to give such representatives an opportunity to review and comment on such IRS Submission prior to filing it with the IRS.

(b) No IRS Submission shall be filed by DutchCo or CoffeeCo, with the IRS unless, prior to such filing, Sara Lee has agreed as to the contents of such IRS Submission; provided, however, that if the IRS requests same-day filing of an IRS Submission that does not include any material issue or statement, then DutchCo or CoffeeCo is required only to make a good faith effort to notify Sara Lee’s representatives and to give such representatives an opportunity to review and comment on such IRS Submission prior to filing it with the IRS.

(c) Each Party shall provide the other Party with copies of each IRS Submission filed with the IRS promptly following the filing thereof. Neither Party nor their representatives shall conduct any substantive communications with the IRS regarding any material issue arising with respect to an IRS Submission, including meetings or conferences with IRS personnel, whether telephonically, in person or otherwise, without first notifying the other Party (or their representatives) and giving the latter Party (or their representatives) a reasonable opportunity to participate, and a reasonable number of each Party’s representatives shall have an opportunity to participate in all conferences or meetings with IRS personnel that take place in person, regardless of the nature of the issues expected to be discussed. Each Party shall copy the other Party (or their representatives) on all written correspondence of such Party (or their representatives) to the IRS, and shall promptly provide the other Party (or their representatives) with copies of any correspondence received by such Party (or their representatives) from the IRS, in each case, relating to an IRS Submission.

4.04 Enforcement. The Parties hereto acknowledge that irreparable harm would occur in the event that any of the provisions of this Article IV were not performed in accordance with their specific terms or were otherwise breached. The Parties hereto agree that, in order to preserve the qualification of (A) the CoffeeCo Contribution, the Distribution and the Debt Exchange as a reorganization within the meaning of Sections 355, 368 and 361 of the Code, and (B) the Merger as a reorganization within the meaning of Section 368 of the Code that is Taxable to U.S. stockholders under Section 367 of the Code, injunctive relief is appropriate to prevent any violation of the foregoing covenants; provided, however, that injunctive relief shall not be the exclusive legal or equitable remedy for any such violation.

ARTICLE V. COOPERATION AND EXCHANGE OF INFORMATION

5.01 Cooperation.

(a) Notwithstanding anything to the contrary in the Master Separation Agreement and the Transaction Agreements, Sara Lee and CoffeeCo shall cooperate (and shall cause each of their respective Affiliates to cooperate) fully at such time and to the extent reasonably requested by the other Party in connection with the preparation and filing of any Tax Return or the conduct of any Tax controversy, including (without limitation) any audit, protest, or claim for refund to the Appeals Division of the IRS, competent authority proceeding and litigation in Tax Court or any other court of competent jurisdiction (a “Tax Controversy”), (including providing a power of attorney) concerning any issues or any other matter

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contemplated under this Agreement or otherwise as reasonably requested by the other Party. Each Party shall make its employees and facilities available on a mutually convenient basis to facilitate such cooperation.

(b) Notwithstanding anything to the contrary in this Agreement, if a Party materially fails to comply with any of its obligations set forth in this Section 5.01, upon reasonable request and notice by the other Party, the non-performing Party shall (i) reimburse the other Party for any internal or incremental costs incurred by such other Party in having its employees or agents view or obtain such material, and (ii) to the extent such failure results in the imposition of additional Taxes be liable in full for such additional Taxes.

5.02 Retention of Records.

(a) The Parties shall retain and provide to one another on demand books, records, documentation, information, or other materials (including computer data) relating to any Tax Return, or any supplemental information necessary or reasonably helpful to support any position taken therein until the later of (x) the expiration of the applicable statute of limitation (giving effect to any extension, waiver, or mitigation thereof), (y) in the event any claim has been made under this Agreement for which such information is relevant, the occurrence of a Final Determination with respect to such claim, and (z) seven (7) years after the Distribution Date.

(b) The Parties shall retain and provide to one another on demand books, records, documentation, information, or other materials (including computer data) necessary or reasonably helpful in sustaining any position (including, without limitation, any transfer pricing position) taken with any Taxing Authority including, without limitation, materials regarding accounting, income and expense, costs and cost production, background, research and development, comparables, marketing, suppliers and customers, and other information regarding the CoffeeCo Business related to the Tax treatment of such business until the other Party provides written notice that such retention is no longer required.

(c) At any time after the Distribution Date that a Party proposes to destroy materials or information required to be retained pursuant to Section 5.02(a) and (b), it shall first notify the other Party in writing and such other Party shall be entitled to receive such materials or information proposed to be destroyed that relate to any member of such other Party’s Group or any assets held by any member of such other Party’s Group.

5.03 Confidentiality. Any materials contemplated to be shared under Section 5.01, Section 5.04 and Section 3.01 shall be provided whether or not such material is or may be confidential or proprietary. If, however, the providing Party determines in good faith that any materials are confidential or proprietary, the providing Party may require the requesting Party to enter into a confidentiality agreement with respect to such materials, not inconsistent with the purposes for which the Party made the request for information. Each Party shall be deemed to have satisfied its obligation to hold confidential information concerning or supplied by the other Party if it exercises the same care as it takes to preserve confidentially for its own similar information.

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5.04 Contest Provisions.

(a) Except as provided elsewhere in this Section 5.05(b)(ii) and 5.05(c) with respect to “reasonable participation”, the Party responsible for Taxes under Article II (the “Responsible Party”) shall, with respect to a Tax return, have the exclusive right at its own cost, to control, contest and represent the interests of Sara Lee, CoffeeCo, DutchCo and their respective Affiliates in any Tax Controversy related to such Tax Return. Subject to Section 5.04(b) and Section 5.04(c) hereof, such right to control shall include the right, in the Responsible Party’s reasonable discretion, to resolve, settle or agree to any deficiency, claim or adjustment proposed, asserted or assessed in connection with or as a result of any such Tax Controversy. Such right to control shall extend to any matter pertaining to the management and control of a Tax Controversy, including execution of waivers, choice of forum, scheduling of conferences and the resolution of any Tax Item.

(b) Notwithstanding anything to the contrary in Section 5.04(a), Sara Lee shall be the Responsible Party with respect to (i) any Tax Controversy that arises with respect to a U.S. federal income Tax Return of the Sara Lee Group (including for this purpose, members of the CoffeeCo Group) for fiscal years 2009, 2010 and 2011 and (ii) any Tax Controversy that arises with respect to a U.S. federal income Tax Return of the Sara Lee Group for fiscal year 2012, provided, however, that at the request of Sara Lee or at CoffeeCo’s option CoffeeCo shall reasonably participate as described in Section 5.05 in the contest of such Tax Controversy described in clause (ii) of this Section 5.04(b).

(c) Notwithstanding anything to the contrary in Section 5.04(a) and Section (b), CoffeeCo shall be the Responsible Party with respect to any Tax Controversy that arises with respect to a U.S. federal income Tax Return of the CoffeeCo Group for fiscal year 2012 or 2013, provided, however, that at the request of CoffeeCo or at Sara Lee’s option, Sara Lee shall reasonably participate as described in Section 5.05 in the contest of such Tax Controversy.

(d) Sara Lee shall use reasonable efforts to keep CoffeeCo advised as to the status of Tax audits and litigation involving any issue that relates to a Tax of CoffeeCo or any Affiliate of CoffeeCo or that could reasonably be expected to give rise to a liability of CoffeeCo or any Affiliate of CoffeeCo under this Agreement, and CoffeeCo shall use reasonable efforts to keep Sara Lee advised as to the status of Tax audits and litigation involving any issue that relates to a Tax of Sara Lee or any Affiliate of Sara Lee or could reasonably be expected to give rise to a liability of Sara Lee or any Affiliate of Sara Lee under this Agreement (in each case, a “Liability Issue”). Sara Lee and CoffeeCo shall promptly furnish each other copies of any inquiries or requests for information from any Taxing Authority or any other administrative, judicial, or other governmental authority concerning any Liability Issue pertaining to the other Party. Without limiting the foregoing, Sara Lee and CoffeeCo, as the case may be, shall each promptly furnish to the other within 20 calendar days of receipt a copy of the relevant section of the revenue agent’s report or similar report, notice of proposed adjustment, or notice of deficiency received by Sara Lee or its Affiliate or by CoffeeCo or its Affiliate, as the case may be, relating to any known or potential Liability Issue or any similar adjustment.

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(e) In the event that timely notice is not provided, including pursuant to Section 5.04(d), of a Liability Issue, the Indemnifying Party shall be relieved of its obligation to indemnify the Indemnified Party only to the extent that such delay results in actual increased costs (and only to the extent of such actual increased costs) if such Liability Issue results in a claim for indemnification.

(f) With respect to Tax Controversies relating to a U.S. federal income Tax Return of the Sara Lee Group for fiscal years 2009-2013, all costs incurred in connection with a Party’s control of or participation in a Tax Controversy shall be borne by the incurring Party.

5.05 Reasonable Participation.

(a) In the event that the non-controlling Party elects or is required to participate in the defense of a Tax Controversy pursuant to Section 5.04(b)(ii) or (c), the Responsible Party shall (i) provide the non-controlling Party with notice reasonably in advance of any proceeding relating to such Tax Controversy and (ii) consult in good faith with the non-controlling Party on the resolution of the Tax Controversy and on any written submissions in connection with such Tax Controversy, including providing the non-controlling Party with an opportunity to review and provide comments on any written submission.

(b) The non-controlling Party shall have the right, at its expense, to be present at, and participate in, any proceeding relating to such Tax Controversy to the extent allowed by Law.

(c) The Responsible Party shall not settle, either administratively or after the commencement of litigation, such Tax Controversy without the prior written consent of the non-controlling Party which shall not be unreasonably withheld, conditioned or delayed. If the non-controlling Party withholds, conditions or delays consent in a manner deemed “unreasonable” by the Responsible Party, Article VII shall govern the determination of unreasonable.

5.06 Information for Shareholders.

(a) Sara Lee shall provide each shareholder that receives stock of CoffeeCo and/or DutchCo pursuant to the Distribution and the Merger with the information necessary for such shareholder to comply with the requirements of Section 355 of the Code and the Treasury regulations thereunder with respect to statements that such shareholders must file with their federal income tax returns demonstrating the applicability of Section 355 of the Code to the Distribution.

(b) Sara Lee shall make available on its website the information required by Section 6045B with respect to the effect of the Distribution on the basis of Sara Lee and CoffeeCo stock in the hands of a U.S. taxpayer.

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ARTICLE VI. INDEMNITY OBLIGATIONS AND PAYMENTS

6.01 Indemnity Obligations. In addition to the obligations set forth in Article II,

(a) The Sara Lee Group shall indemnify and hold harmless CoffeeCo and any member of the CoffeeCo Group from and against any liability, cost or expense, including, without limitation, any fine, penalty, interest, charge or accountant’s fee, arising out of fraudulent or negligent preparation of any Tax Return or claim for refund filed by Sara Lee or an Affiliate of Sara Lee for any period during which CoffeeCo or any member of the CoffeeCo Group was or has been a member of the Sara Lee Consolidated Group, or arising out of the untimely provision of information required to provided under this Agreement.

(b) The CoffeeCo Group shall indemnify and hold harmless Sara Lee and any member of the Sara Lee Group from and against any liability, cost or expenses, including, without limitation, any fine, penalty, interest, charge or accountant’s fee, arising out of fraudulent or negligent information, workpapers, documents and other items prepared by CoffeeCo or any Affiliate of CoffeeCo used in the preparation of any Tax Return or claim for refund filed by Sara Lee or any Affiliate of Sara Lee for any period during which CoffeeCo or any Affiliate of CoffeeCo was or has been a member of the Sara Lee Consolidated Group, or arising out of the untimely provision of information required to provided under this Agreement.

6.02 [ ]

(a) Notice. A Party making a claim for indemnification or for payment of an allocated or contested liability under this Agreement (the “Indemnified Party”) shall provide the Party from whom such indemnification is sought (the “Indemnifying Party”) with written notice of such claim describing such claim in reasonable detail and accompanied by reasonable documentation supporting such claim (the “Claim”) no later than twenty (20) calendar days after the Indemnified Party (i) files a Tax Return reporting Taxes due which are subject to reimbursement or (ii) receives written notice from any Taxing Authority with respect to a Final Determination of Taxes that may be subject to indemnification under this Agreement.

(b) In the event that timely notice is not provided, including pursuant to Section 6.02(a), of a claim for indemnification or payment, the Indemnifying Party shall be relieved of its obligation to indemnify the Indemnified Party only to the extent that such delay results in actual increased costs (and only to the extent of such actual increased costs).

6.03 In the event that an Indemnifying Party has received a claim from an Indemnified Party pursuant to Section 6.02, then such payment shall be made according to this Section 6.03.

(a) All payments shall be made to the Indemnified Party or to the appropriate Taxing Authority as specified by Indemnified Party within 20 calendar days after delivery of written notice of payment owing together with a computation of the amounts due.

(b) Unless otherwise required by any Final Determination, the Parties agree that any payment made by one Party to another Party (other than payments of interest and payment of After Tax Amounts pursuant to Section 6.03(d)) pursuant to this Agreement shall be treated for all Tax and financial accounting purposes as payments with respect to stock (dividend distributions or capital contributions, as the case may be) made immediately prior to the Distribution.

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(c) If, pursuant to a Final Determination, it is determined that the receipt or accrual of any payment made under this Agreement (other than payments of interest) is subject to any Tax, the Party making such payment shall be liable for (i) the After Tax Amount with respect to such payment, and (ii) interest at the rate described in 6.03(e) on the amount of such tax from the date such Tax is due through the date of payment of such After Tax Amount. A Party making a demand for payment pursuant to this Agreement and for a payment of an After Tax Amount with respect to such payment shall separately specify and compute such After Tax Amount. However, a Party may choose not to specify an After Tax Amount in a demand for payment pursuant to this Agreement without thereby being deemed to have waived its right subsequently to demand an After Tax Amount with respect to such payment.

(d) Any payment that is required to be made pursuant to this Agreement (i) by CoffeeCo (or an Affiliate of CoffeeCo) to Sara Lee (or an Affiliate of Sara Lee) or (ii) by Sara Lee (or an Affiliate of Sara Lee) to CoffeeCo (or an Affiliate of CoffeeCo), that is not made on or prior to the date that such payment is required to be made pursuant to this Section 6.03 shall thereafter bear interest at the rate established for underpayments pursuant to Section 6621(a)(2) of the Code.

(e) Any payment that is required to be made pursuant to this Agreement (i) by CoffeeCo (or an Affiliate of CoffeeCo) to Sara Lee (or an Affiliate of Sara Lee) or (ii) by Sara Lee (or a Sara Lee Affiliate) to CoffeeCo (or an Affiliate of CoffeeCo), shall be made by wire transfer of immediately available funds, provided that if the amount of any payment is less than $10,000, such payment may be made in a form other than a wire transfer.

(f) All actions required to be taken by any Party under this Agreement shall be performed within the time prescribed for performance in this Agreement, or if no period is prescribed, such actions shall be performed promptly. If an Indemnifying Party does not respond to a written claim received from an Indemnified Party within 30 days of receiving such claim, or does respond within such 30-day period and rejects such claim in whole or in part, the Indemnified Party shall be free to pursue resolution as provided in Article VII; provided, however, that pursuant to this Section 6.03, interest begins to accrue after 20 days following delivery of written notice of payment owing together with a computation of the amounts due.

ARTICLE VII. DISPUTE RESOLUTION

7.01 All disputes, controversies or claim arising under or in connection with this Agreement (including any dispute, controversy, or claim relating to the breach, termination, or validity thereof) (whether sounding in contract, tort or otherwise) between or among any of the Sara Lee Parties and the CoffeeCo Parties shall be governed by Article XII of the Master Separation Agreement. Each of the Sara Lee Parties and the CoffeeCo Parties agrees that the procedures set forth in Article XII of the Master Separation Agreement shall be the sole and exclusive remedy in connection with any dispute, controversy or claim relating to any of the foregoing matters.

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ARTICLE VIII. MISCELLANEOUS

8.01 Section 1.2 (Interpretation) and Article XIII (Miscellaneous) of the Master Separation Agreement are incorporated by reference to the extent not inconsistent with any of the provisions set forth in this Agreement.

8.02 Effectiveness. This Agreement shall become effective on the Distribution Date.

8.03 Disclaimers.

(a) Sara Lee disclaims all knowledge of or responsibility for the content or accuracy of any separate returns or filings made by or on behalf of CoffeeCo or any Affiliate of CoffeeCo for any Taxable period during which such company was not a member of the Sara Lee Consolidated Group.

(b) CoffeeCo disclaims all knowledge of or responsibility for the content or accuracy of any Tax Returns or filings made by or on behalf of the Sara Lee Consolidated Group or any member thereof for any period except to the extent such Tax Returns or filings reflect items of the CoffeeCo Business.

8.04 Changes in Law. Any reference to a provision of the Code, Treasury Regulations, or a law of another jurisdiction shall include a reference to any applicable successor provision or law. If, due to any change in applicable law or regulations or their interpretation by any court of law or other governing body having jurisdiction subsequent to the date specified in the preamble to this Agreement, performance of any provision of this Agreement or any transaction contemplated hereby shall become impracticable or impossible, the Parties hereto shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such provision.

8.05 Notices. All notices, requests, claims, demands and other communications required or permitted hereunder shall be in writing and shall be deemed given or delivered (a) when delivered personally, (b) if transmitted by email to the email address designated by each Party, on the date the recipient confirms receipt, (c) if sent by registered or certified mail, postage prepaid, return receipt requested, on the third business day after mailing or (d) if sent by nationally recognized overnight courier, on the first business day following the date of dispatch; and shall be addressed as follows: If to Sara Lee, at: Sara Lee Corporation 3500 Lacey Road, Downers Grove, Illinois 60515 Attention: Jeff Emme, Senior Vice President – Tax

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If to CoffeeCo on or prior to June 28, 2012, at: DE US, Inc. 3500 Lacey Road, Downers Grove, Illinois 60515 Attention: Jeff Emme, Vice President

If to CoffeeCo after June 28, 2012, at: DE US, Inc. Oosterdokstraat 80 1011 DK Amsterdam, The Netherlands Attention: Louis W. Haring

8.06 Joint and Several Liability. CoffeeCo and each Affiliate of CoffeeCo shall have joint and several liability for any obligation of CoffeeCo or an Affiliate of CoffeeCo arising pursuant to this Agreement. Sara Lee and each Affiliate of Sara Lee shall have joint and several liability for any obligation of Sara Lee or an Affiliate of Sara Lee arising pursuant to this Agreement.

8.07 Expenses. Unless otherwise expressly provided in this Agreement or the Master Separation Agreement, each Party shall bear any and all expenses that arise from their respective obligations under this Agreement.

8.08 Confidentiality.

(a) Each Party shall hold and cause its consultants and advisors to hold in strict confidence, unless compelled to disclose by judicial or administrative process or, in the opinion of its counsel, by other requirements of law, all information written or oral concerning the other Parties hereto furnished it by such other Party or its representatives pursuant to this Agreement (except to the extent that such information can be shown to have been (a) previously known by the Party to which it was furnished, (b) in the public domain through no fault of such Party, or (c) later lawfully acquired from other sources by the Party to which it was furnished), and each Party shall not release or disclose such information to any other person, except its auditors, attorneys, financial advisors, bankers and other consultants and advisors who shall be advised of the provisions of this Section 8.08(a). Each Party shall be deemed to have satisfied its obligation to hold confidential information concerning or supplied by the other Party if its exercises the same care as it takes to preserve confidentiality for its own similar information.

(b) Notwithstanding Section 8.08(a), the provisions regarding confidentiality set forth in Section 5.1 shall govern information required to be provided pursuant to Article III and Article V.

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8.09 Limitation on Damages. Each Party irrevocably waives, and no Party shall be entitled to seek or receive, consequential, special, indirect or incidental damages (including without limitation damages for loss of profits) or punitive damages, regardless of how such damages were caused and regardless of the theory of liability; provided that the foregoing shall not limit each Party’s indemnification obligations set forth in the Master Separation Agreement and the Transaction Agreements

8.10 Consent by Affiliates. Each of Sara Lee and CoffeeCo shall cause each of its respective Affiliates (including any entity that becomes an Affiliate after the date hereof) to consent to, and be bound by, the terms, conditions, covenants, and provisions of this Agreement.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their authorized representatives as of the date first written above.

[Signature Page to Tax Sharing Agreement]

SARA LEE CORPORATION

By: /s/ Mark A. Garvey Name: Mark A. GarveyTitle: Executive Vice President and

Chief Financial Officer

[Signature page to Tax Sharing Agreement]

DE US, INC.

By: /s/ Mark S. Silver Name: Mark S. Silver Title: President

[Signature page to Tax Sharing Agreement]

D.E MASTER BLENDERS1753 B.V.

By: /s/ Michel M.G. Cup Name: Michel M.G. Cup Title: Chief Financial Officer

Schedule 1

See Schedule 1.1(f) to the Master Separation Agreement

Schedule 2

See Schedule 1.1(e) to the Master Separation Agreement

Exhibit 4.16

Execution Version

EMPLOYEE MATTERS AGREEMENT

by and between

SARA LEE CORPORATION,

D.E MASTER BLENDERS 1753 B.V.

and

DE US, INC.

Dated as of June 15, 2012

EMPLOYEE MATTERS AGREEMENT (this “Agreement”), dated as of June 15, 2012, by and between Sara Lee Corporation, a Maryland corporation (“Sara Lee”), D.E MASTER BLENDERS 1753 B.V., a private company with limited liability with corporate seat in Joure (Skarsterlân), The Netherlands (“DutchCo”) and DE US, Inc., a Delaware corporation (“CoffeeCo”), and, as of the date hereof, a wholly-owned subsidiary of Sara Lee. Each of Sara Lee, DutchCo and CoffeeCo is herein referred to as a “Party” and collectively, as the “Parties.” Capitalized terms used herein and not otherwise defined herein, including in Article III below, shall have the meanings ascribed to them in the Separation Agreement (as defined below).

RECITALS:

WHEREAS, the Sara Lee Board has determined that it would be advisable and in the best interests of Sara Lee and its stockholders for Sara Lee to reorganize CoffeeCo such that, among other things, Sara Lee shall contribute to CoffeeCo (i) 100% of the ownership interests of the Transferred Subsidiaries and (ii) the Transferred Business Assets, in each case to the extent not already owned by CoffeeCo, as of the date hereof;

WHEREAS, the Sara Lee Board has determined that it would be advisable and in the best interests of Sara Lee and its stockholders for Sara Lee to distribute on a pro rata basis to the holders of the Sara Lee Shares, without any consideration being paid by the holders of such Sara Lee Shares, all of the CoffeeCo Shares owned by Sara Lee as of the Distribution Date;

WHEREAS, to effectuate the foregoing, the Parties have entered into a Master Separation Agreement, by and between the Parties, dated as of June 15, 2012 (as amended, modified and/or restated from time to time, the “Separation Agreement”), which provides, among other things, subject to the terms and conditions set forth therein, for the Separation and the Distribution, and the execution and delivery of certain other agreements in order to facilitate and provide for the foregoing; and

WHEREAS, pursuant to the Separation Agreement, the Parties have agreed to enter into this Agreement for the purpose of setting forth certain agreements regarding employee benefit plans, programs and arrangements, and certain employment matters as described herein.

NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained herein, and subject to and on the terms and conditions herein set forth, the Parties hereby agree as follows:

ARTICLE I

GENERAL EMPLOYEE AND BENEFIT PLAN RELATED PRINCIPLES

1.1 Participation in Sara Lee Benefit Plans and CoffeeCo Benefit Plans. Schedule 1.1 (a) to this Agreement sets forth a list of all Sara Lee Benefit Plans and Schedule 1.1(b) to this Agreement sets forth a list of a separate list of all CoffeeCo Benefit Plans, in each case in effect as of the date of this Agreement. Except as set forth in Schedule 1.1(c) of this Agreement, as of the date hereof, no CoffeeCo Employee participates or is eligible to participate, or at any time could become, or be deemed to be, eligible to participate, in any Sara Lee Benefit Plan, and no Sara Lee Employee participates or is eligible to participate, or at any time could become, or be deemed to be, eligible to participate, in any CoffeeCo Benefit Plan. From and following the Effective Time, except as, and solely to the extent, set forth in Schedule 1.1(d) of this Agreement, (a) CoffeeCo Employees shall be eligible to participate solely in CoffeeCo Benefit Plans, subject to the terms and conditions thereof, and (b) Sara Lee Employees shall be eligible to participate solely in Sara Lee Benefit Plans, subject to the terms and conditions thereof.

1.2 Liabilities Under Sara Lee Benefit Plans and CoffeeCo Benefit Plans. From and following the Effective Time, (a) neither Sara Lee nor any Sara Lee Party shall have any Liability under any CoffeeCo Benefit Plan and (b) neither CoffeeCo nor any CoffeeCo Party shall have any Liability under any Sara Lee Benefit Plan. Prior to the Effective Time, Sara Lee and CoffeeCo shall take all actions that are necessary or appropriate to ensure that, as of the Effective Time, (a) Sara Lee will not be a party to or a sponsor, obligor or guarantor of, and will not have any Liability whatsoever under, any CoffeeCo Benefit Plan and (b) CoffeeCo will not be a party to, or a sponsor, obligor or guarantor of, and will not have any Liability whatsoever under, any Sara Lee Benefit Plan, which necessary or appropriate actions may include, as applicable, entering into any agreements, whether between the Parties or among third parties, assigning obligations or Liabilities under CoffeeCo Benefit Plans or Sara Lee Benefit Plans, as applicable, effecting any necessary amendments to any CoffeeCo Benefit Plan or Sara Lee Benefit Plan, securing any consents that may be required and negotiating with third parties to effectuate the provisions of this Section 1.2. Notwithstanding anything to the contrary in this Agreement, the Parties acknowledge and agree that to the extent any Sara Lee Benefit Plan or CoffeeCo Benefit Plan holds or otherwise contains Sara Lee Shares or will hold, contain or receive CoffeeCo Shares or DutchCo Shares in connection with the transactions contemplated by the Separation Agreement, determinations with respect to such Sara Lee Shares, CoffeeCo Shares or DutchCo Shares shall be made by the Sara Lee Entities and CoffeeCo Entities, respectively, including, in either case, any administering or governing body applicable under any such Sara Lee Benefit Plan or CoffeeCo Benefit Plan or persons to which such determinations are delegated under the respective Sara Lee Benefit Plan or CoffeeCo Benefit Plan, subject to the terms thereof and applicable law.

1.3 Liabilities Related to Sara Lee Employees and CoffeeCo Employees. Except as set forth in this Agreement and as may be mutually agreed upon by CoffeeCo and Sara Lee from time to time following the date of this Agreement, effective as of the Effective Time, (a) CoffeeCo shall assume and hereby agrees to be obligated to pay, perform, fulfill and discharge,

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(i) with respect to CoffeeCo Employees, all Liabilities relating to, arising out of, or resulting from future, present or former employment with the CoffeeCo Business (including Liabilities relating to, arising out of, or resulting from the CoffeeCo Benefit Plans); (ii) all Liabilities relating to, arising out of, or resulting from any other actual or alleged employment relationship with the CoffeeCo Parties; and (iii) all other Liabilities relating to, arising out of, or resulting from obligations, liabilities and responsibilities expressly assumed or retained by the CoffeeCo Parties or a CoffeeCo Benefit Plan pursuant to this Agreement and (b) Sara Lee shall assume and hereby agrees to be obligated to pay, perform, fulfill and discharge, (i) with respect to Sara Lee Employees, all Liabilities relating to, arising out of, or resulting from future, present or former employment with the Sara Lee Business (including Liabilities relating to, arising out of, or resulting from the Sara Lee Benefit Plans); (ii) all Liabilities relating to, arising out of, or resulting from any other actual or alleged employment relationship with the Sara Lee Parties; and (iii) all other Liabilities relating to, arising out of, or resulting from obligations, liabilities and responsibilities expressly assumed or retained by the Sara Lee Parties or a Sara Lee Benefit Plan pursuant to this Agreement.

ARTICLE II LONG-TERM INCENTIVE AWARDS

2.1 Sara Lee Options. 2.1.1 Adjustment of Sara Lee Options. Each Sara Lee Option in effect as of immediately prior to the Distribution shall be

adjusted on the Distribution Date as follows: (a) the per share exercise price applicable to the Sara Lee Option immediately following the Distribution shall equal the exercise price of the Sara Lee Option immediately prior to the Distribution divided by the Sara Lee Ratio, rounded up to the nearest whole cent, and (b) the number of Sara Lee Shares subject to the Sara Lee Option immediately following the Distribution shall be equal to the product of (i) the number of Sara Lee Shares subject to the Sara Lee Option immediately prior to the Distribution and (ii) the Sara Lee Ratio, rounded down to the nearest whole share. The “Sara Lee Ratio” means the Pre-Distribution Sara Lee Share Price divided by the Post-Distribution Sara Lee Share Price.

2.1.2 Sara Lee Pre-2012 Options. Each Sara Lee Pre-2012 Option that is held immediately prior to the Distribution by a Sara Lee Employee, a CoffeeCo Employee or a Terminating Employee (or any respective beneficiary thereof), as adjusted pursuant to Section 2.1.1, shall vest in full as of the Distribution Date and remain exercisable for Sara Lee Shares by the applicable CoffeeCo Employee, Sara Lee Employee or Terminating Employee, as applicable, until the date that is six months after the Distribution Date, after which the Sara Lee Pre-2012 Option shall terminate and be canceled; provided, however, that each Sara Lee Employee or CoffeeCo Employee who is a current, active employee of a Sara Lee Party or a CoffeeCo Party as of immediately prior to the Distribution, and who is not a Terminating Employee, may elect instead to have the Sara Lee Pre-2012 Options that are held by such Sara Lee Employee or CoffeeCo Employee continue to vest and remain exercisable for Sara Lee Shares following the Distribution in accordance with the vesting schedule, the term and other terms and conditions applicable to the Sara Lee Pre-2012 Option, subject to the adjustment pursuant to Section 2.1.1. For the avoidance of doubt, each of the Terminating Employees whose Sara Lee Pre-2012 Options shall be covered by this Section 2.1.2 are listed on Schedule 2.1.2, attached hereto.

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2.1.3 Sara Lee 2012 Options. On the Distribution Date, each Sara Lee 2012 Option, as adjusted pursuant to Section 2.1.1, shall continue to vest and remain subject to the terms and conditions as in effect for such Sara Lee 2012 Option immediately prior to the Distribution.

2.1.4 Sara Lee Vested Options. Each Sara Lee Option that is vested and outstanding immediately prior to the Distribution, as adjusted pursuant to Section 2.1.1, shall remain exercisable in accordance with the terms of such option.

2.2 Sara Lee RSUs. 2.2.1 Adjustment of Sara Lee RSUs. Each Sara Lee RSU that is outstanding as of immediately prior to the Distribution and

that is held by a Sara Lee Employee, a CoffeeCo Employee or a Terminating Employee, other than the Chairman 2012 RSUs and the CEO 2012 RSUs (the “Employee-Held Sara Lee RSUs”) shall be adjusted on the Distribution Date such that the number of Sara Lee Shares subject to the Employee-Held Sara Lee RSU immediately following the Distribution shall equal the product of (a) the number of Sara Lee Shares subject to the Employee-Held Sara Lee RSU immediately prior to the Distribution, and (b) the Sara Lee Ratio, with the resulting number of Sara Lee Shares subject to the Employee-Held Sara Lee RSU immediately following the Distribution being rounded down to the nearest whole share.

2.2.2 Sara Lee Pre-2012 RSUs. Each Sara Lee Pre-2012 RSU, as adjusted pursuant to Section 2.2.1, shall vest in full on the Distribution Date and the holder of each Sara Lee Pre-2012 RSU shall be entitled to receive Sara Lee Shares in settlement of the Sara Lee Pre- 2012 RSUs as soon as practicable following the Effective Time, provided that, if a deferral election is in place with respect to such Sara Lee Pre-2012 RSU, such Sara Lee Pre-2012 RSU shall be deferred as provided under, and subject to the terms of, the applicable deferred compensation plan.

2.2.3 Sara Lee 2012 RSUs. (a) Each Sara Lee 2012 RSU, as adjusted pursuant to Section 2.2.1, that is held by a Sara Lee Employee, shall

remain subject to the terms and conditions applicable to such Sara Lee Employee 2012 RSU as of immediately prior to the Distribution Date.

(b) Each Sara Lee 2012 RSU, as adjusted pursuant to Section 2.2.1, that is held by a Terminating Employee (a “Terminating Employee 2012 RSU”) shall vest in full on the Distribution Date and the holder of each Terminating Employee 2012 RSU shall be entitled to receive Sara Lee Shares in settlement of the Terminating Employee 2012 RSU as soon as practicable following the Effective Time.

2.2.4 Chairman 2012 RSUs. A prorated portion of the Chairman 2012 RSUs shall vest on the Distribution Date based on the number of months elapsed between the grant date of the Chairman 2012 RSUs and the Distribution Date, rounding up to the end of month in which Distribution Date occurs, and any remaining Chairman 2012 RSUs that do not vest shall

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terminate and be canceled as of the Distribution Date. That portion of the Chairman 2012 RSUs that vest on the Distribution Date (the “Vested Chairman 2012 RSUs”) will be settled in DutchCo Shares as soon as practicable following the Separation, the number of which shall be determined by multiplying the number of Sara Lee Shares subject to the Chairman 2012 RSU that vest on the Distribution Date by a fraction, the numerator of which shall be the Pre-Distribution Sara Lee Share Price and the denominator of which shall be the Post-Distribution DutchCo Share Price (as converted into U.S. dollars in accordance with the currency exchange rate published by the Federal Reserve Bank of New York for the Distribution Date), the resulting number of DutchCo Shares being rounded down to the nearest whole share; provided that, with respect to the settlement of the Vested Chairman 2012 RSUs the per share nominal value applicable to DutchCo Shares underlying RSUs required to be paid in accordance with Dutch law (the “DutchCo RSU Payment Obligation”) shall be paid by withholding from the settlement of the Vested Chairman 2012 RSUs a number of DutchCo Shares, determined by multiplying the per share nominal value of a DutchCo Share by a fraction, the numerator of which is the number of DutchCo Shares subject to the Vested Chairman 2012 RSUs and the denominator of which is the DutchCo Share Fair Market Value. The withheld DutchCo Shares, and any right of the Chairman to receive such withheld DutchCo Shares, shall be set off against the DutchCo RSU Payment Obligation.

2.2.5 CEO 2012 RSUs. The CEO 2012 RSUs shall vest in full on the Distribution Date and will be settled in DutchCo Shares as soon as practicable following the Separation, the number of which shall be determined by multiplying the number of Sara Lee Shares subject to the CEO 2012 RSU by a fraction, the numerator of which shall be the Pre- Distribution Sara Lee Share Price and the denominator of which shall be the Post-Distribution DutchCo Share Price (as converted into U.S. dollars in accordance with the currency exchange rate published by the Federal Reserve Bank of New York for the Distribution Date), the resulting number of DutchCo Shares being rounded down to the nearest whole share; provided that, with respect to the settlement of the CEO 2012 RSUs, the DutchCo RSU Payment Obligation shall be paid by withholding from the settlement of the CEO 2012 RSUs a number of DutchCo Shares, determined by multiplying the per share nominal value of a DutchCo Share by a fraction, the numerator of which is the number of DutchCo Shares subject to the CEO 2012 RSUs and the denominator of which is the DutchCo Share Fair Market Value. The withheld DutchCo Shares, and any right of the CEO to receive such withheld DutchCo Shares, shall be set off against the DutchCo RSU Payment Obligation.

2.2.6 Sara Lee Director RSUs. (a) Each holder of a Sara Lee RSU who is a non-employee director of Sara Lee as of May 31, 2013 (each such RSU,

a “Sara Lee Director RSU”) will receive a new grant of CoffeeCo RSUs (the “CoffeeCo Director RSU”) with the number of DutchCo Shares underlying the CoffeeCo Director RSU equal to the product of (i) the number of Sara Lee Shares subject to the Sara Lee Director RSU as of immediately prior to the Distribution, multiplied by (ii) a fraction, the numerator of which is the difference between the Pre-Distribution Sara Lee Share Price and the Post-Distribution Sara Lee Share Price (without giving effect to any reverse stock split applicable to the Sara Lee Shares effective on or following the Distribution Date) and the denominator of which is the Post-Distribution DutchCo Share Price (as converted into U.S. dollars in accordance with the currency exchange rate published by the Federal Reserve Bank of New York for the Distribution Date), with the resulting number of DutchCo Shares subject to the CoffeeCo Director RSU being rounded down to the nearest whole share.

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(i) Each Sara Lee Director RSU and CoffeeCo Director RSU held by a non-employee director who continues serving on the Sara Lee Board (a “Post-Distribution Sara Lee Director”) immediately after the Distribution (the “Post-Distribution Sara Lee Board”) will be settled in Sara Lee Shares and DutchCo Shares, respectively, on the date that is six months following the date upon which the director ceases to serve on the Post-Distribution Sara Lee Board; provided that, with respect to the settlement of the CoffeeCo Director RSUs held by each Post-Distribution Sara Lee Director, the DutchCo RSU Payment Obligation shall be paid by withholding from the settlement of the CoffeeCo Director RSUs a number of DutchCo Shares, determined by multiplying the per share nominal value of a DutchCo Share by a fraction, the numerator of which is the number of DutchCo Shares subject to the CoffeeCo Director RSUs and the denominator of which is the DutchCo Share Fair Market Value. The withheld DutchCo Shares, and any right of the Post-Distribution Sara Lee Director to receive such withheld DutchCo Shares, shall be set off against the DutchCo RSU Payment Obligation.

(ii) Each Sara Lee Director RSU and CoffeeCo Director RSU held by a non-employee director who shall serve as a director of the DutchCo Board immediately after the Distribution (a “Post-Distribution CoffeeCo Director”) or who otherwise does not become a director on the Post-Distribution Sara Lee Board following the Distribution (a “Non-Continuing Director”) will be settled in Sara Lee Shares and DutchCo Shares, respectively, on the date that is six months following the Distribution Date; provided that, with respect to the settlement of the CoffeeCo Director RSUs held by each Post-Distribution CoffeeCo Director and Non-Continuing Director, the DutchCo RSU Payment Obligation shall be paid by withholding from the settlement of the CoffeeCo Director RSUs a number of DutchCo Shares, determined by multiplying the per share nominal value of a DutchCo Share by a fraction, the numerator of which is the number of DutchCo Shares subject to the CoffeeCo Director RSUs and the denominator of which is the DutchCo Share Fair Market Value. The withheld DutchCo Shares, and any right of the Post-Distribution CoffeeCo Director or Non-Continuing Director, as applicable, to receive such withheld DutchCo Shares, shall be set off against the DutchCo RSU Payment Obligation.

(b) Effective as of the Effective Time, DutchCo shall have adopted a form grant agreement, which shall provide for the issuance of restricted stock unit awards denominated in DutchCo Shares pursuant to the terms of this Section 2.2.6 and shall have material terms and conditions substantially similar to those restricted stock unit awards issued under the relevant Sara Lee Stock Plans.

2.3 Sara Lee PSUs. 2.3.1 Adjustment of Sara Lee PSUs. Each Sara Lee PSU that is outstanding as of immediately prior to the Distribution

other than the CoffeeCo Employee 2012 PSUs and the Chairman 2012 PSUs (the “Pre-Distribution Sara Lee PSUs”) shall be adjusted on the Distribution Date such that the number of Sara Lee Shares subject to the Sara Lee PSU immediately following the Distribution (the “Post-Distribution Sara Lee PSUs”) shall equal the product of (a) the number of Sara Lee Shares subject to the Pre-Distribution Sara Lee PSU, and (b) the Sara Lee Ratio, the resulting number of Sara Lee Shares subject to the Post-Distribution Sara Lee PSU being rounded down to the nearest whole share.

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2.3.2 Sara Lee Pre-2012 PSUs. On the Distribution Date, with respect to each Sara Lee Pre-2012 PSU, as adjusted pursuant to Section 2.3.1, (1) for any portion of the Performance Cycle that occurs prior to the last day of the most recently completed Sara Lee fiscal period prior to the Distribution Date (such applicable last day of the fiscal period, the “PSU Measurement Date”), the achievement of the performance goal or goals applicable to the Sara Lee Pre-2012 PSU will be determined as of the Distribution Date based on actual performance results up to and including the PSU Measurement Date, and (2) for any remaining portion of the Performance Cycle following the PSU Measurement Date, the achievement of the performance goal or goals applicable to the Sara Lee Pre-2012 PSU will be determined as of the Distribution Date based on the target performance level ((1) and (2), together, the “Earned Sara Lee Employee 2012 PSUs”). The Earned Sara Lee Pre-2012 PSUs shall vest in full on the Distribution Date, and the holder of each Sara Lee Pre-2012 PSU shall be entitled to receive Sara Lee Shares in settlement of the Earned Sara Lee Pre-2012 PSU as soon as practicable following the Effective Time, provided that, if a deferral election is in place with respect to such Earned Sara Lee Pre-2012 PSU, such Earned Sara Lee Pre-2012 PSU shall be deferred as provided under, and subject to the terms of, the applicable deferred compensation plan.

2.3.3 Sara Lee 2012 PSUs. (a) On the Distribution Date, with respect to each Sara Lee 2012 PSU, as adjusted pursuant to Section 2.3.1, that is

held by a Sara Lee Employee (the “Sara Lee Employee 2012 PSUs”) (1) if the Distribution Date occurs prior to the end of Sara Lee’s fiscal year 2012 (“Sara Lee FY2012”), the achievement of the performance goal or goals applicable to the Sara Lee Employee 2012 PSU will be determined as of the Distribution Date (i) based on actual performance results up to the Distribution Date, with respect to the portion of Sara Lee FY2012 that has occurred up to the Distribution Date and (ii) based on the target performance level, with respect to the remaining portion of Sara Lee FY2012 that has not yet occurred as of the Distribution Date, and (2) if the Distribution Date occurs on or after the end of the Sara Lee FY2012, the achievement of the performance goal or goals applicable to the Sara Lee Employee 2012 PSU will be determined based on actual performance results for Sara Lee FY2012 (in the case of either (1) or (2), the “Earned Sara Lee Employee 2012 PSUs”). From and following the Distribution Date, except as provided in the foregoing, the Earned Sara Lee Employee 2012 PSUs shall remain subject to the vesting and other terms and conditions applicable to the Sara Lee Employee 2012 PSUs as of immediately prior to the Distribution.

(b) On the Distribution Date, with respect to each Sara Lee 2012 PSU that is held by a CoffeeCo Employee (the “CoffeeCo Employee 2012 PSU”) (1) if the Distribution occurs prior to the end of Sara Lee FY2012, the achievement of the performance goal or goals applicable to the CoffeeCo Employee 2012 PSU will be determined as of the Distribution Date (i) based on actual performance results up to the Distribution Date, with respect to the portion of Sara Lee FY2012 that occurs up to the Distribution Date and (ii) based on the target performance level, with respect to the remaining portion of Sara Lee FY2012 that has not yet occurred as of the Distribution Date, and (2) if the Distribution Date occurs on or

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after the end of Sara Lee FY2012, the achievement of the performance goal or goals applicable to the CoffeeCo Employee 2012 PSU will be determined based on actual performance results for Sara Lee FY2012 (in the case of either (1) or (2), the “Earned CoffeeCo Employee 2012 PSUs”). Immediately following the Distribution and Merger, the Earned CoffeeCo Employee 2012 PSUs will be assumed by DutchCo and converted into PSUs denominated in DutchCo Shares (the “Assumed CoffeeCo Employee 2012 PSUs”). the number of which shall be determined by multiplying the number of Sara Lee Shares subject to the Earned CoffeeCo Employee 2012 PSU by a fraction, the numerator of which shall be the Pre-Distribution Sara Lee Share Price and the denominator of which shall be the Post-Distribution DutchCo Share Price (as converted into U.S. dollars in accordance with the currency exchange rate published by the Federal Reserve Bank of New York for the Distribution Date), the resulting number of DutchCo Shares subject to the Assumed CoffeeCo Employee 2012 PSUs being rounded down to the nearest whole share.

(i) Effective as of the Effective Time, DutchCo shall have adopted a long-term incentive plan, which shall permit the issuance of long-term incentive awards that have material terms and conditions substantially similar to those long-term incentive awards issued under the relevant Sara Lee Stock Plans in respect of which DutchCo long-term incentive awards will be granted to certain CoffeeCo Employees, which shall be settled in DutchCo Shares as described herein, in connection with and following the Distribution.

(ii) All Assumed CoffeeCo Employee 2012 PSUs shall become vested upon the date the Earned CoffeeCo Employee 2012 PSUs would have otherwise vested in accordance with the existing vesting schedule applicable to such Earned CoffeeCo Employee 2012 PSUs. Upon the vesting of the Assumed CoffeeCo Employee 2012 PSUs, the CoffeeCo Parties shall be solely responsible for the settlement of all of the Assumed CoffeeCo Employee 2012 PSUs; provided that, with respect to the settlement of the Assumed CoffeeCo Employee 2012 PSUs held by each CoffeeCo Employee, the per share nominal value applicable to DutchCo Shares underlying PSUs required to be paid in accordance with Dutch law (the “DutchCo PSU Payment Obligation”) shall be paid by withholding from the settlement of such Assumed CoffeeCo Employee 2012 PSUs a number of DutchCo Shares, determined by multiplying the per share nominal value of a DutchCo Share by a fraction, the numerator of which is the number of DutchCo Shares subject to the Assumed CoffeeCo Employee 2012 PSUs and the denominator of which is the DutchCo Share Fair Market Value. The withheld DutchCo Shares, and any right of the CoffeeCo Employee to receive such withheld DutchCo Shares, shall be set off against the DutchCo PSU Payment Obligation.

2.3.4 Each Sara Lee 2012 PSU, as adjusted pursuant to Section 2.3.1, which is held by a Terminating Employee (a “Terminating Employee 2012 PSU”). shall vest as follows: (1) if the Distribution occurs during Sara Lee FY2012, the achievement of the performance goal or goals applicable to the Terminating Employee 2012 PSU will be determined as of the Distribution Date (i) based on actual performance results up to the Distribution Date, with respect to the portion of Sara Lee FY2012 that occurs up to the Distribution Date and (ii) based on the target performance level, with respect to the remaining portion of Sara Lee FY2012 that has not yet occurred as of the Distribution Date, and (2) if the Distribution Date occurs on or after the end of Sara Lee FY2012, the achievement of the performance goal or goals applicable to the Sara Lee Employee 2012 PSU will be determined based on actual performance results for Sara Lee FY2012 (in the case of either (1) or (2), the “Earned Terminating Employee 2012 PSUs”), and the holder of each Earned Terminating Employee 2012 PSU shall be entitled to receive Sara Lee Shares in settlement of the Terminating Employee 2012 PSU as soon as practicable following the Effective Time.

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2.3.5 The Chairman 2012 PSUs shall vest as follows: (1) if the Distribution occurs prior to the end of Sara Lee’s fiscal year 2012, the achievement of the performance goal or goals applicable to the Chairman 2012 PSUs will be determined as of the Distribution Date (i) based on actual performance results up to the Distribution Date, with respect to the portion of Sara Lee FY2012 that occurs up to the Distribution Date and (ii) based on the target performance level, with respect to the remaining portion of Sara Lee’s fiscal year 2012 that has not yet occurred as of the Distribution Date, and (2) if the Distribution Date occurs on or after the end of Sara Lee’s fiscal year 2012, the achievement of the performance goal or goals applicable to the Chairman 2012 PSUs will be determined based on actual performance results of Sara Lee for fiscal year 2012 (the “Earned Chairman 2012 PSUs”) provided that, only a prorated portion of the Earned Chairman 2012 PSUs shall vest based on the number of months elapsed between the grant date and the Distribution Date, rounding up to the end of month in which Distribution Date occurs (the “Vested Chairman 2012 PSUs”). and any remaining Chairman 2012 PSUs that do not vest shall terminate and be canceled as of the Distribution Date. The Vested Chairman 2012 PSUs will be settled in DutchCo Shares as soon as practicable following the Separation, the number of which shall be determined by multiplying the number of Sara Lee Shares subject to the Vested Chairman 2012 PSUs by a fraction, the numerator of which shall be the Pre-Distribution Sara Lee Share Price and the denominator of which shall be the Post-Distribution DutchCo Share Price (as converted into U.S. dollars in accordance with the currency exchange rate published by the Federal Reserve Bank of New York for the Distribution Date), the resulting number of DutchCo Shares being rounded down to the nearest whole share; provided that, with respect to the settlement of the Vested Chairman 2012 PSUs the DutchCo PSU Payment Obligation shall be paid by withholding from the settlement of such Vested Chairman 2012 PSUs a number of DutchCo Shares, determined by multiplying the per share nominal value of a DutchCo Share by a fraction, the numerator of which is the number of DutchCo Shares subject to the Vested Chairman 2012 PSUs and the denominator of which is the DutchCo Share Fair Market Value. The withheld DutchCo Shares, and any right of the Chairman to receive such withheld DutchCo Shares, shall be set off against the DutchCo PSU Payment Obligation.

2.4 Each Sara Lee Option that is exercised by a CoffeeCo Employee following the Separation shall be subject to tax and any other applicable legal withholdings by the Sara Lee Parties, with respect to which the CoffeeCo Parties shall cooperate with, and provide all necessary information to, the Sara Lee Parties for the purposes of determining the required rates and amounts to be withheld for the payment of such taxes and any other applicable withholding required to be made under the laws governing the CoffeeCo Employee’s exercise of the Sara Lee Option and receipt of Sara Lee Shares. The Sara Lee Parties shall transfer to the CoffeeCo Parties as soon as practicable following such withholding all such withheld amounts for the purposes of payment of such amounts by the CoffeeCo Parties to the applicable governmental or other entity governing such CoffeeCo Employee.

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ARTICLE III

DEFINITIONS

“Affiliate” means, with respect to any Person, any other Person that, at the time of determination, directly or indirectly Controls, is Controlled by or is under common Control with such Person.

“Benefit Plan” means, with respect to an entity, each plan, program, arrangement, agreement or commitment that is an employment, change in control, severance, consulting, non-competition or deferred compensation agreement, or a compensation, incentive bonus or other bonus, commission, employee pension, profit-sharing, savings, retirement, supplemental retirement, stock option, stock purchase, restricted stock, restricted stock unit, other equity-based compensation, severance pay, retention, salary continuation, life, health, hospitalization, disability or accident insurance plan, or other employee benefit plan, program, arrangement, agreement or commitment, including any “employee benefit plan” (as defined in Section 3(3) of ERISA) and any collective bargaining agreement or similar agreement or understanding with any union or works council, in the case of any of the foregoing, sponsored or maintained by such entity (or to which such entity contributes or is required to contribute or in which it participates).

“CEO” means the Executive Vice President and Chief Executive Officer of the CoffeeCo Business.

“CEO 2012 RSUs” means the Sara Lee RSUs granted to the CEO on January 26, 2012, and that are outstanding immediately prior to the Distribution Date.

“Chairman” means the Executive Chairman of Sara Lee, Jan Bennink.

“Chairman 2012 PSUs” means the Sara Lee PSUs granted to the Chairman on January 26, 2012, and that are outstanding immediately prior to the Distribution Date.

“Chairman 2012 RSUs” means the Sara Lee RSUs granted to the Chairman on January 26, 2012, and that are outstanding immediately prior to the Distribution Date.

“CoffeeCo Benefit Plan” means any Benefit Plan of the CoffeeCo Business.

“CoffeeCo Employee” means any individual who, on the Distribution Date, is actively employed by, or on leave of absence from, the CoffeeCo Business or who is a former employee of the CoffeeCo Business, including any Terminating Employee who, as of the Distribution Date, is a current or former employee of the CoffeeCo Business. For the avoidance of doubt, CoffeeCo Employee includes any employee the majority of whose regular working time is or was devoted to the CoffeeCo Business and who participates or participated in any CoffeeCo Benefit Plan even if, for administrative reasons (i.e., due to an expatriate assignment or that employee’s position as an corporate officer or member of a corporate staff function), such employee was on the payroll of a Sara Lee Party prior to the Distribution Date; provided that for any former employee who was employed by both the Sara Lee Business and the CoffeeCo Business, such former employee shall be deemed a CoffeeCo Employee solely to the extent the employee was employed by the CoffeeCo Business on the date the employee’s employment terminated.

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“CoffeeCo Parties” means CoffeeCo, the CoffeeCo Subsidiaries, the Transferred Subsidiaries, DutchCo and any other Subsidiary or Affiliate of CoffeeCo or DutchCo (including, those formed or acquired after the date hereof), other than the Sara Lee Parties.

“DutchCo Share Fair Market Value” means the closing selling price per DutchCo Share on the Euronext Amsterdam on the settlement date of the applicable award, provided that if there are no sales of DutchCo Shares reported on such date, the Fair Market Value of a DutchCo Share on such date shall be deemed equal to the closing selling price of a DutchCo Share on the Euronext Amsterdam for the last preceding date on which sales of DutchCo Shares were reported.

“Performance Cycle” means the performance cycle applicable to a Sara Lee Pre-2012 PSU, as set forth in the applicable grant agreement and incentive program description.

“Post-Distribution DutchCo Share Price” means the volume weighted average price of the DutchCo Shares trading in the “as-if-and-when issued” market on the Euronext Amsterdam over the first two trading days following the Distribution Date.

“Post-Distribution Sara Lee Share Price” means the volume weighted average price of the Sara Lee Shares trading on the New York Stock Exchange over the first two trading days following the Distribution Date.

“Pre-Distribution Sara Lee Share Price” means the volume weighted average price of the Sara Lee Shares trading the regular way on the New York Stock Exchange over the two trading days prior to the Distribution Date, which two-day period will include the Distribution Date if such date is a trading day.

“Sara Lee 2012 Option” means each Sara Lee Option with a grant date on or after November 4, 2011, and that is outstanding immediately prior to the Distribution Date.

“Sara Lee 2012 PSU” means each Sara Lee PSU with a grant date on or after November 4, 2011, and that is outstanding immediately prior to the Distribution Date, other than the Chairman 2012 PSUs.

“Sara Lee 2012 RSU” means each Sara Lee RSU with a grant date on or after November 4, 2011, and that is outstanding immediately prior to the Distribution Date, other than the CEO 2012 RSUs and the Chairman 2012 RSUs.

“Sara Lee Benefit Plan” means any Benefit Plan of the Sara Lee Business.

“Sara Lee Employee” means any individual who, on the Distribution Date, is actively employed by, or on a leave of absence from, the Sara Lee Business or who is a former employee of the Sara Lee Business, including any (a) Terminating Employee who, as of the Distribution Date, is a current or former employee of the Sara Lee Business and (b) Transition Employee, but excluding any CoffeeCo Employee; provided that for any former employee who was employed by both the Sara Lee Business and the CoffeeCo Business, such former employee shall be deemed a Sara Lee Employee solely to the extent the employee was employed by the Sara Lee Business on the date the employee’s employment terminated.

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“Sara Lee Option” means each stock option to purchase Sara Lee Shares granted under a Sara Lee Stock Plan.

“Sara Lee Parties” means Sara Lee and its Subsidiaries (including those formed or acquired after the date hereof), other than the CoffeeCo Parties.

“Sara Lee Pre-2012 Option” means each Sara Lee Option with a grant date prior to November 4, 2011, and that is outstanding and unvested immediately prior to the Distribution Date.

“Sara Lee Pre-2012 PSU” means each Sara Lee PSU with a grant date prior to November 4, 2011, and that is outstanding and unvested immediately prior to the Distribution Date.

“Sara Lee Pre-2012 RSU” means each Sara Lee RSU with a grant date prior to November 4, 2011, and that is outstanding immediately prior to the Distribution Date.

“Sara Lee PSU” means an award of performance-based restricted stock units denominated in Sara Lee Shares granted under a Sara Lee Stock Plan.

“Sara Lee RSU” means an award of restricted stock units denominated in Sara Lee Shares granted under a Sara Lee Stock Plan.

“Sara Lee Stock Plans” means any of the Sara Lee 1998 Long-Term Incentive Plan, the Sara Lee 2002 Long-Term Incentive Plan, the Sara Lee Share 2003 Global Stock Plan and the Sara Lee 1999 Non-Employee Director Stock Plan, as amended and restated.

“Terminating Employee” means any individual who was an employee of either the Sara Lee Business or the CoffeeCo Business prior to the Effective Time who has not been offered a permanent post-Separation position with the Sara Lee Business or the CoffeeCo Business, or who has not accepted such an offer, and whose employment will terminate effective on, or within a defined transition period after, the Distribution Date and who will not thereafter be an employee of any of the Sara Lee Parties or the CoffeeCo Parties.

“Transition Employees” means those employees identified in the Transition Services Agreement who will provide transition services to the CoffeeCo Parties following the Distribution Date in accordance with the Transition Services Agreement.

“Transition Services Agreement” means the Transition Services Agreement that is an exhibit to the Separation Agreement.

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ARTICLE IV

GENERAL PROVISIONS

4.1 Entire Agreement; Incorporation Of Schedules And Exhibits. This Agreement, the Separation Agreement, the Merger Agreement and the other Transaction Agreements (including all Schedules and Exhibits referred to herein or therein) constitute the entire agreement among the Parties with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, both written and oral, among the Parties with respect to the subject matter hereof and thereof All Schedules and Exhibits referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein.

4.2 Effect on Employment; No Third-Party Beneficiaries. (i) Except as expressly provided in this Agreement and other than termination of CoffeeCo Employees’ employment with the Sara Lee Entities where the CoffeeCo Employees remain employed by the CoffeeCo Entities following the Distribution, the mere occurrence of the Distribution shall not cause any employee to be deemed to have incurred a termination of employment, and (ii) nothing in this Agreement is intended to confer upon any Sara Lee Employee or CoffeeCo Employee any right to continued employment, or any recall or similar rights to an individual on layoff or any type of approved leave. Notwithstanding anything to the contrary herein, in the Separation Agreement or in any other Transaction Agreement, the Parties acknowledge and agree that this Agreement is solely for the benefit of the Parties hereto and their respective successors and permitted assigns. Nothing in this Agreement, express or implied, is intended to or shall confer upon any other person or persons (including any Sara Lee Employee, CoffeeCo Employee or Terminating Employee) any rights, benefits or remedies of any nature whatsoever under or by reason of this Agreement. No provision of this Agreement shall modify or amend, or be deemed to modify or amend, any other agreement, plan, program or document, including any Sara Lee Benefit Plan and any CoffeeCo Benefit Plan.

4.3 CoffeeCo and Sara Lee Under No Obligation to Maintain Plans. Except as specified otherwise in this Agreement, nothing in this Agreement shall preclude CoffeeCo, Sara Lee or DutchCo, at any time after the Distribution Date, from amending, merging, modifying, terminating, eliminating, reducing, or otherwise altering in any respect any CoffeeCo Benefit Plan or any Sara Lee Benefit Plan, any benefit under any CoffeeCo Benefit Plan or Sara Lee Benefit Plan or any trust, insurance policy or funding vehicle related to any CoffeeCo Benefit Plan or Sara Lee Benefit Plan, or any employment or other service arrangement with any CoffeeCo Employee or any Sara Lee Employee, or independent contractors or vendors of the CoffeeCo Parties or the Sara Lee Parties, as the case may be (to the extent permitted by law).

4.4 Cooperation to Obtain Consents. If any provision of this Agreement is dependent on the consent of any third party (such as a vendor or Benefit Plan administrator) and such consent is withheld, the Parties shall use their commercially reasonable best efforts to implement the applicable provisions of this Agreement. If any provision of this Agreement cannot be implemented due to the failure of such third party to consent, the Parties shall cooperate and negotiate in good faith to implement the provision in a mutually satisfactory manner.

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4.5 Amicable Resolution; Dispute Resolution. The Parties desire that friendly collaboration will develop between them. Accordingly, the Parties will endeavor to resolve in an amicable manner all disputes and disagreements connected with their respective rights and obligations under this Agreement in accordance with Article XII of the Separation Agreement. Except as expressly set forth in Article XII of the Separation Agreement, Article XII of the Separation Agreement shall govern the resolution of any dispute, controversy or claim arising under or in connection with this Agreement (including any dispute, controversy or claim relating to the breach, termination or validity hereof).

4.6 Effect of the Separation Agreement. The Parties expressly acknowledge and agree that the covenants, agreements and other provisions of the Separation Agreement, including, without limitation, the obligations and covenants set forth under Section 6.6, Article X and Article XI, shall govern and be binding on the Parties with respect to the subject matter, and in furtherance of the purposes, of this Agreement.

4.7 Amendments And Waivers. This Agreement may be amended and any provision of this Agreement may be waived, provided that any such amendment or waiver shall be binding upon a Party only if such amendment or waiver is set forth in a writing executed by such Party. No course of dealing between or among any Persons having any interest in this Agreement shall be deemed effective to modify, amend or discharge any part of this Agreement or any rights or obligations of any Party under or by reason of this Agreement.

4.8 No Implied Waivers; Cumulative Remedies; Writing Required. No delay or failure in exercising any right, power or remedy hereunder shall affect or operate as a waiver thereof; nor shall any single or partial exercise thereof or any abandonment or discontinuance of steps to enforce such a right, power or remedy preclude any further exercise thereof or of any other right, power or remedy. The rights and remedies hereunder are cumulative and not exclusive of any rights or remedies that any Party hereto would otherwise have. Any waiver, permit, consent or approval of any kind or character of any breach or default under this Agreement or any such waiver of any provision of this Agreement must satisfy the conditions set forth in Section 4.7 and shall be effective only to the extent in such writing specifically set forth.

4.9 Parties In Interest. Nothing in this Agreement, express or implied, is intended to confer on any Person other than the Parties, their respective Affiliates, and their respective successors and permitted assigns, any rights or remedies of any nature whatsoever under or by virtue of this Agreement.

4.10 Notices. All notices, requests, claims, demands and other communications required or permitted hereunder shall be in writing and shall be deemed given or delivered (a) when delivered personally, (b) if transmitted by email, on the date the recipient confirms receipt, (c) if sent by registered or certified mail, postage prepaid, return receipt requested, on the third business day after mailing or (d) if sent by nationally recognized overnight courier, on the first business day following the date of dispatch; and shall be addressed as follows:

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If to CoffeeCo, prior to or on June 28, 2012, to: DE US, Inc. 3500 Lacey Road Downers Grove, Illinois, 60515 Attention: Helen N. Kaminski Email: helen.kaminski@hillshirebrands.com

If to CoffeeCo, after June 28, 2012, to: DE US, Inc. Oosterdokstraat 80 1011 DK Amsterdam, The Netherlands Attention: Onna van Klinken Email: onno.vanklinken@demb.com

If to Sara Lee, to: Sara Lee Corporation 3500 Lacey Road Downers Grove, Illinois 60515 Attention: Kent Magill, General Counsel Email: kent.magill@hillshirebrands.com

If to DutchCo, to: D.E MASTER BLENDERS 1753 B.V. Oosterdokstraat 80 1011 DK Amsterdam,The Netherlands Attention: Onno van Klinken, General Counsel Email: onno.vanklinken@demb.com

or to such other address as such Party may indicate by a notice delivered to the other Parties in accordance herewith.

4.11 Severability. The Parties agree that (a) the provisions of this Agreement shall be severable in the event that for any reason whatsoever any of the provisions hereof are invalid, void or otherwise unenforceable, (b) any such invalid, void or otherwise unenforceable provisions shall be replaced by other provisions which are as similar as possible in terms to such invalid, void or otherwise unenforceable provisions but are valid and enforceable, and (c) the remaining provisions shall remain valid and enforceable to the fullest extent permitted by applicable law.

4.12 Construction. The descriptive headings herein are inserted for convenience of reference only and are not intended to be a substantive part of or to affect the meaning or interpretation of this Agreement. Whenever required by the context, any pronoun used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular forms of nouns, pronouns, and verbs shall include the plural and vice versa. Reference to any agreement, document, or instrument means such agreement, document, or instrument as

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amended or otherwise modified from time to time in accordance with the terms thereof, and if applicable hereof. The use of the words “include” or “including” in this Agreement shall be by way of example rather than by limitation. The use of the words “or,” “either” or “any” shall not be exclusive. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement. The Parties agree that prior drafts of this Agreement shall be deemed not to provide any evidence as to the meaning of any provision hereof or the intent of the Parties hereto with respect hereto.

4.13 Counterparts. This Agreement may be executed in multiple counterparts (any one of which need not contain the signatures of more than one party), each of which shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their authorized representatives as of the date first written above.

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SARA LEE CORPORATION

By: /s/ Mark A. GarveyName: Mark A. Garvey Title: Executive Vice President and Chief Financial Officer

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DE US, INC.

By: /s/ Mark S. Silver

Name: Mark S. Silver Title: President

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D.E MASTER BLENDERS

By: /s/ Michel M.G. Cup

Name: Michel M.G. Cup Title: Chief Financial Officer

Exhibit 4.17 Execution Version

INTELLECTUAL PROPERTY SEPARATION AGREEMENT

This Intellectual Property Separation Agreement (this “Agreement”), dated as of June 15, 2012, is by and among Sara Lee Corporation, a Maryland corporation (“Sara Lee”), on the one hand, and D.E MASTER BLENDERS 1753 B.V., a private company with limited liability with corporate seat in Joure (Skarsterlân), The Netherlands (“DutchCo”), and DE US, Inc., a Delaware corporation (“CoffeeCo” and together with DutchCo, the “CoffeeCo Parties”), on the other hand (each, a “Party” and collectively, the “Parties”).

RECITALS

WHEREAS, the board of directors of Sara Lee has determined that it is appropriate and desirable to separate the CoffeeCo Business of Sara Lee from its other businesses;

WHEREAS, in order to effectuate the foregoing, Sara Lee and the CoffeeCo Parties have entered into a Master Separation Agreement dated on or around the date hereof (as amended, modified and/or restated from time to time, the “Separation Agreement”), which provides, among other things, subject to the terms and conditions set forth therein, for the Separation and the Contribution, and for the execution and delivery of certain other agreements in order to facilitate and provide for the foregoing;

WHEREAS, under the Separation Agreement, Sara Lee shall transfer and assign certain Sara Lee coffee trademarks, copyrights, patents and design rights to the CoffeeCo Party designated by CoffeeCo, including such trademarks, copyrights, patents and design rights listed in a schedule to the Separation Agreement; and

WHEREAS, the Parties desire to set forth in this Agreement certain rights and obligations related to intellectual property matters necessary in order to ensure an orderly transition under the Separation Agreement.

NOW, THEREFORE, in consideration of the mutual promises contained herein, the Parties hereby agree as follows:

ARTICLE I LIMITED LICENSE

Section 1.1 Trademark License Grant. Subject to the terms and conditions of this Agreement, Sara Lee hereby grants to the CoffeeCo Parties a fully-paid-up, royalty-free, non-exclusive and non-transferable license, without the right to sublicense (except as expressly permitted in this Section 1.1), to use the Sara Lee Marks, as set forth on Schedule 1 attached hereto, in the Territory solely in connection with the Licensed Materials. The CoffeeCo Parties may sublicense the Sara Lee Marks to their Affiliates, and the CoffeeCo Parties and their Affiliates may sublicense the Sara Lee Marks to agents and contractors of the CoffeeCo Parties and their Affiliates to the extent such agents and contractors provide services to the CoffeeCo Parties or their Affiliates, in each case solely in connection with the Licensed Materials. The CoffeeCo Parties shall cause any of their Affiliates and any such third parties so sublicensed hereunder to comply with the terms and conditions of the Trademark License Agreement.

Section 1.2 Obligation to Discontinue Use. The CoffeeCo Parties shall use their reasonable best efforts to discontinue use of the Sara Lee Marks by January 1, 2014. Upon expiration or termination of the Trademark License Agreement, all rights of the CoffeeCo Parties to use the Sara Lee Marks shall terminate immediately and shall revert to Sara Lee, and the CoffeeCo Parties shall discontinue all use of the Licensed Materials and the Sara Lee Marks in connection with the Licensed Materials; provided that, notwithstanding the foregoing, nothing contained in this Agreement shall prevent the CoffeeCo Parties or their Affiliates from using the name of Sara Lee or its Affiliates as and to the extent reasonably necessary or appropriate in public filings with Governmental Authorities, Materials intended for distribution to either Party’s or its Affiliates’ stockholders, or other communications that accurately describe the relationship between the Parties and their respective Affiliates. In connection with the foregoing, upon Sara Lee’s written request, a corporate officer of the CoffeeCo Parties shall certify that, based upon a reasonable investigation, the CoffeeCo Parties have either: (i) destroyed the Licensed Materials as of the effective date of such termination or expiration; or (ii) removed the Sara Lee Marks from the Licensed Materials. The obligation to discontinue use described in this Section 1.2 shall not apply to Licensed Materials that, as of the date of expiration or termination of the Trademark License Agreement, the CoffeeCo Parties or any of their Affiliates have released into the stream of commerce and that are no longer under the CoffeeCo Parties’ or their Affiliates’ control.

Section 1.3 Obligation to Cease Ordering Materials. The CoffeeCo Parties shall cease creating and ordering any Licensed Materials bearing the Sara Lee Marks prior to, and shall cease all use of the Licensed Materials by, January 1, 2014.

Section 1.4 Corporate Name. Subject to the terms and conditions of this Agreement, Sara Lee grants to the CoffeeCo Parties a fully-paid-up, royalty-free, non-exclusive and non-transferable license, without the right to sublicense (except as expressly permitted in this Section 1.4), to use, and to permit its Affiliates to use, the Sara Lee Marks solely as part of the CoffeeCo corporate names set forth on Schedule 2 attached hereto in the same manner such corporate names were used immediately prior to the Effective Time; provided that, to the extent

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that any CoffeeCo corporate names incorporate any Sara Lee Mark(s) as of the Effective Time and such names are not included in Schedule 2, CoffeeCo may notify Sara Lee in writing of the existence of such names and such names shall be added to Schedule 2 upon Sara Lee’s receipt of such notice; provided, however, that the CoffeeCo Parties and their Affiliates shall diligently pursue discontinuation of the use of such corporate names by completing the name change process by January 1, 2014; provided further, however, that (i) with respect to any packaging for products that reference such corporate names, the CoffeeCo Parties and their Affiliates shall cease such use as soon as reasonably practicable and in any event shall cease such use no later than July 31, 2015, and (ii) with respect to any CoffeeCo Party undergoing liquidation prior to January 1, 2014, the CoffeeCo Parties and their Affiliates shall diligently pursue implementation and execution of the liquidation process by January 1, 2014 but if such liquidation process has not been completed by such time notwithstanding such efforts then they shall continue to diligently pursue such completion of such liquidation as soon as is possible.

ARTICLE II OWNERSHIP AND PROTECTION OF THE SARA LEE MARKS.

Section 2.1 Sara Lee’s Ownership. The Parties hereby acknowledge that, as between the Parties, Sara Lee is the sole and exclusive owner of all right, title and interest in and to the Sara Lee Marks. The CoffeeCo Parties shall not directly or indirectly challenge Sara Lee’s sole and exclusive ownership of all right, title and interest in and to the Sara Lee Marks. All goodwill arising from the CoffeeCo Parties’ or their permitted sublicensees’ use of the Sara Lee Marks shall be considered to have inured solely to the benefit of Sara Lee. Neither the CoffeeCo Parties nor their Affiliates shall acquire any ownership rights in the Sara Lee Marks, variations thereon, or marks confusingly similar thereto, as a result of exercise of any rights under this Agreement.

Section 2.2 Prohibited Actions. The CoffeeCo Parties shall not after January 1, 2014, and shall cause their Affiliates to not after January 1, 2014, adopt, use, register or apply for registrations anywhere in the world for the Sara Lee Marks or any other Trademarks that: (i) are confusingly similar to the Sara Lee Marks; (ii) are variations of the Sara Lee Marks; or (iii) incorporate the Sara Lee Marks. In using the Sara Lee Marks pursuant to this Agreement, the CoffeeCo Parties shall in no way represent that they have any rights, title or interest in the Sara Lee Marks other than those expressly granted under this Agreement.

Section 2.3 Infringement. Sara Lee shall have the sole and exclusive right to enforce any rights in the Sara Lee Marks with respect to potential infringement, dilution or other violation. The CoffeeCo Parties shall provide Sara Lee, at Sara Lee’s written request and expense for reasonable out-of-pocket costs, all reasonable assistance that may be required in any action to enforce Sara Lee’s rights in the Sara Lee Marks.

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Section 2.4 Protection of Rights in Sara Lee Marks. The CoffeeCo Parties shall assist Sara Lee, at Sara Lee’s written request and expense for reasonable out-of-pocket costs, to the extent reasonably necessary to protect any of Sara Lee’s rights in the Sara Lee Marks.

Section 2.5 Sublicense Agreements. If and to the extent that the CoffeeCo Parties are party to or bound by a Contract pursuant to which the CoffeeCo Parties grant to a Third Party a sublicense or any other right with respect to a Sara Lee Mark (a “Sublicense Agreement”), the CoffeeCo Parties shall enforce all of the obligations of such Third Party with respect to the Sara Lee Marks thereunder, and cooperate with Sara Lee in connection therewith. In addition, the CoffeeCo Parties shall not waive any right, or renew or extend the term of, or modify or amend, such Contract with respect to the Sara Lee Marks without the prior written consent of Sara Lee.

Section 2.6 Reservation of Rights. Any rights not expressly granted to the CoffeeCo Parties with respect to the Sara Lee Marks under this Agreement are expressly reserved by Sara Lee.

ARTICLE III QUALITY CONTROL AND USE OF THE SARA LEE MARKS.

Section 3.1 Quality Control. The CoffeeCo Parties shall use the Sara Lee Marks only as expressly permitted in Sections 1.1 and 1.4 of this Agreement. The CoffeeCo Parties shall use the Sara Lee Marks only in connection with goods or services of a high quality in keeping with the reputation and goodwill of Sara Lee as of the Effective Time. The CoffeeCo Parties shall not, by any act or omission, tarnish, disparage or injure the reputation of the Sara Lee Marks or Sara Lee, and the goodwill associated therewith.

Section 3.2 Inspection. The CoffeeCo Parties shall reasonably cooperate with Sara Lee in facilitating Sara Lee’s ability to determine the nature and quality of the activities of the CoffeeCo Parties and their Affiliates in connection with the Sara Lee Marks. Upon reasonable advance notice (which shall not be less than three (3) Business Days) and during regular business hours, the CoffeeCo Parties shall permit Sara Lee to inspect the relevant facilities and records related to the CoffeeCo Parties’ or their Affiliates’use of the Sara Lee Marks.

Section 3.3 Required Notices. In using the Sara Lee Marks in connection with the Licensed Materials, the CoffeeCo Parties shall duly include all notices and legends with respect to the Sara Lee Marks as are or may be reasonably requested in writing by Sara Lee or required by applicable laws.

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Section 3.4 Compliance. The CoffeeCo Parties shall comply with all applicable laws and regulations pertaining to its activities in connection with the Sara Lee Marks.

ARTICLE IV TERM AND TERMINATION OF LICENSE GRANTS.

Section 4.1 Term. Unless earlier terminated in accordance with Section 4.2 of this Agreement, the Trademark License shall be in effect from the Effective Time until January 1, 2014, and the Corporate Name License shall be in effect until January 1, 2014 (except as and to the extent the Corporate Name License is permitted to be extended as set forth in Section 1.4).

Section 4.2 Termination. The Trademark License and the Corporate Name License shall each automatically terminate with respect to the CoffeeCo Parties and their rights to use the Sara Lee Marks upon the CoffeeCo Parties’ failure to cure any material breach of this Agreement within thirty (30) days after the receipt of written notice of such material breach from Sara Lee.

ARTICLE V TRADEMARK DATABASE.

Section 5.1 Trademark Database Copies. It is the intention of the Parties that, on or before the Effective Time, the CoffeeCo Parties shall possess for their use a copy of the Trademark Database as it concerns Trademarks owned by the CoffeeCo Parties or Trademarks that were used in the Former Business for which use the CoffeeCo Parties have indemnification obligations under the Separation Agreement (“CoffeeCo Database Marks”). To the extent the CoffeeCo Parties do not have such a copy, the Parties shall reasonably cooperate to ensure that the CoffeeCo Parties are able to obtain the copy of the Trademark Database. The CoffeeCo Parties shall be responsible for ensuring that their copy of the Trademark Database and software relating thereto is properly licensed to the CoffeeCo Parties by CPi, and Sara Lee shall reasonably cooperate with the CoffeeCo Parties in connection therewith. Sara Lee shall be entitled to possess and use complete copies of the Trademark Database.

Section 5.2 CoffeeCo Data Inactivation. At such time as the Parties deem appropriate in writing, but in any event within ninety (90) days from the Effective Time, the CoffeeCo Parties shall use their reasonable best efforts to inactivate (or, at Sara Lee’s reasonable request, delete) all data relating to the Sara Lee Trademarks (other than CoffeeCo Database Marks) that exists in the CoffeeCo Parties’ copy of the Trademark Database and all such data relating to such Sara Lee Trademarks (other than CoffeeCo Database Marks) that is otherwise in the CoffeeCo Parties’ or their Affiliates’ possession or control. Within thirty (30) days after such

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deletion, the CoffeeCo Parties shall use reasonable best efforts to require CPi to certify to Sara Lee that such deletion has occurred, and the CoffeeCo Parties shall take all necessary actions to enable CPi to certify such inactivation (or deletion).

Section 5.3 Confidentiality. The CoffeeCo Parties shall hold, and shall cause its Subsidiaries, Affiliates, and Representatives to hold, the Trademark Database and all contents thereof and information contained therein (other than the contents as and to the extent concerning Trademarks owned by the CoffeeCo Parties) in strict confidence in accordance with the confidentiality and privilege provisions of Sections 11.8 and 11.9 of the Separation Agreement mutatis mutandis. Without limitation to the foregoing, the CoffeeCo Parties shall not access or use any contents of or information contained in the Trademark Database except (i) with respect to Trademarks owned by the CoffeeCo Parties, or (ii) to the extent reasonably necessary to operate the CoffeeCo Business and fulfill its obligations under this Agreement, the Separation Agreement and the other Transaction Agreements.

ARTICLE VI

FURTHER ASSURANCES AND COOPERATION.

Section 6.1 CoffeeCo Assurances. The CoffeeCo Parties, upon the written request and at the expense of Sara Lee, shall provide such reasonable cooperation, shall perform such further reasonable acts, and shall execute and deliver such reasonable documents and affidavits that may be necessary to: (i) maintain the registration of the Sara Lee Marks that are registered or applied-for as of the Effective Time, (ii) document and record their rights in the Sara Lee Marks that they own as of the Effective Time, and (iii) prosecute, enforce or defend the Sara Lee Marks that they own as of the Effective Time. The CoffeeCo Parties shall reasonably cooperate with Sara Lee at Sara Lee’s expense, in connection with written requests made pursuant to and in accordance with this Agreement relating to Sara Lee’s Marks as of the Effective Time, portions of the Trademark Database relating to Sara Lee’s Trademarks as of the Effective Time, and Sara Lee’s obligations to any Person as of the Effective Time, which shall include: (x) locating and/or providing Trademark-related records pertaining to the Sara Lee Marks, (y) ensuring appropriate personnel are available to respond to Sara Lee’s requests, and (z) producing information that is reasonably requested on a timely basis with respect to Sara Lee’s Marks as of the Effective Time.

Section 6.2 Sara Lee Assurances. The above Section 6.1 shall apply to Sara Lee, mutatis mutandis, with respect to the assignment and transfer by Sara Lee to the CoffeeCo Party designated by CoffeeCo of the Trademark registrations and applications assigned by Sara Lee to such CoffeeCo Party pursuant to the Separation Agreement.

Section 6.3 Transfer of Registration or Application for Registration. In the event that at any time and from time to time after the Effective Time, any Party or its Affiliate

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shall have registered in its name, or applied for registration in its name, a Trademark that is owned by the other Party or its Affiliate, such Party or its Affiliate shall promptly transfer such registration or application for registration to the appropriate Party or its Affiliate. Each Party shall cooperate with the other Parties and use its commercially reasonable efforts to set up procedures and notifications as are reasonably necessary or advisable to effectuate the transfers contemplated by this Section 6.3.

ARTICLE VII MISCELLANEOUS

Section 7.1 Survival. Section 1.2, Section 2.1, Section 2.2, Section 2.4, Article IV, Article V, Article VI, this Section 7.1, and Sections 7.2 through 7.19 shall survive any expiration or termination of this Agreement in part or in whole.

Section 7.2 Disclaimer of Warranties. THE SARA LEE MARKS ARE PROVIDED “AS IS.” SARA LEE DOES NOT MAKE ANY REPRESENTATIONS OR WARRANTIES OF ANY KIND, WHETHER ORAL OR WRITTEN, WHETHER EXPRESS, IMPLIED, OR ARISING BY STATUTE, CUSTOM, COURSE OF DEALING OR TRADE USAGE, WITH RESPECT TO THE SUBJECT MATTER OF THIS AGREEMENT, IN CONNECTION WITH THIS AGREEMENT OR THE SARA LEE MARKS. SARA LEE SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED WARRANTIES OR CONDITIONS OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND NON-INFRINGEMENT IN CONNECTION WITH THIS AGREEMENT OR THE SARA LEE MARKS.

Section 7.3 Limitation of Liability. TO THE MAXIMUM EXTENT ALLOWED UNDER APPLICABLE LAW, IN NO EVENT WILL SARA LEE BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE DAMAGES ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT, INCLUDING DAMAGES FOR LOST DATA, LOST PROFITS OR COSTS OF PROCUREMENT OF SUBSTITUTE GOODS OR SERVICES, HOWEVER CAUSED AND UNDER ANY THEORY OF LIABILITY, WHETHER BASED IN CONTRACT, TORT (INCLUDING NEGLIGENCE), STATUTE OR OTHERWISE, AND WHETHER OR NOT SARA LEE WAS OR SHOULD HAVE BEEN AWARE OR ADVISED OF THE POSSIBILITY OF SUCH DAMAGE.

Section 7.4 Independent Contractors. The Parties each acknowledge that they are separate entities, each of which has entered into this Agreement for independent business reasons. The relationships of the Parties hereunder are those of independent contractors and nothing contained herein shall be deemed to create a joint venture, employer/employee, partnership or any other relationship.

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Section 7.5 Compliance with Laws. Each Party, in its exercise of the rights licensed to such Party hereunder, shall comply with all applicable laws, rules, regulations and orders of the United States, all other jurisdictions and any agency or court thereof.

Section 7.6 Entire Agreement. This Agreement, the Separation Agreement, and the other Transaction Agreements, including the schedules and exhibits referred to herein and therein, and the documents delivered pursuant hereto and thereto, contain the entire understanding of the Parties with regard to the subject matter contained herein or therein, and supersede all prior agreements, negotiations, discussions, understandings, writings and commitments between any of the Sara Lee Parties, on the one hand, and any of the CoffeeCo Parties, on the other hand, with respect to such subject matter hereof or thereof.

Section 7.7 Conflict with Separation Agreement. In the event of any conflict between the terms and conditions of this Agreement and the terms and conditions of the Separation Agreement, the terms and conditions of this Agreement shall control. For clarity, the indemnification provisions in Article X of the Separation Agreement shall govern any indemnification obligations hereunder.

Section 7.8 Amendments. This Agreement shall not be amended, modified or supplemented except by a written instrument signed by an authorized representative of each of Sara Lee and the CoffeeCo Parties.

Section 7.9 Waiver. Any term or provision of this Agreement may be waived, or the time for its performance may be extended, by the Party entitled to the benefit thereof. Any such waiver shall be validly and sufficiently given for the purposes of this Agreement if, as to any Party, it is in writing signed by an authorized representative of such Party. The failure of any Party to enforce at any time any provision of this Agreement shall not be construed to be a waiver of such provision, or in any way to affect the validity of this Agreement or any part hereof or the right of any Party thereafter to enforce each and every such provision. No waiver of any breach of this Agreement shall be held to constitute a waiver of any other or subsequent breach.

Section 7.10 Partial Invalidity. Wherever possible, each provision hereof shall be construed in a manner as to be effective and valid under applicable law, but in case any one or more of the provisions contained herein shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such provision shall be ineffective to the extent, but only to the extent of such invalidity, illegality or unenforceability without invalidating the remainder of such invalid, illegal or unenforceable provision or provisions or any other provision hereof, unless such a construction would be unreasonable.

Section 7.11 Execution in Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original instrument, but all of which shall be considered one and the same agreement, and shall become binding when the counterparts have been signed by and delivered to each of the Parties.

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Section 7.12 Third-Party Beneficiaries. This Agreement is solely for the benefit of the Parties and their respective successors and permitted assigns, and nothing herein express or implied shall give or be construed to give to any other Person any legal or equitable rights hereunder.

Section 7.13 Notices. All notices, requests, claims, demands and other communications required or permitted hereunder shall be in writing and shall be deemed given or delivered (a) when delivered personally, (b) if transmitted by email, on the date the recipient confirms receipt, (c) if sent by registered or certified mail, postage prepaid, return receipt requested, on the third business day after mailing or (d) if sent by nationally recognized overnight courier, on the first business day following the date of dispatch; and shall be addressed as follows:

If to the CoffeeCo Parties prior to or on June 28, 2012, to: D.E MASTER BLENDERS 1753 B.V. 3500 Lacey Road Downers Grove, Illinois 60515 Attention: Onno van Klinken, General Counsel Email: onno.vanklinken@demb.com

If to the CoffeeCo Parties after June 28, 2012, to: D.E MASTER BLENDERS 1753 N.V. Oosterdokstraat 80 1011 DK Amsterdam, The Netherlands Attention: Onno van Klinken, General Counsel Email: onno.vanklinken@demb.com

If to Sara Lee, to: Sara Lee Corporation 3500 Lacey Road Downers Grove, Illinois 60515 Attention: Kent Magill, General Counsel Email: kent.magill@hillshirebrands.com

or to such other address as such Party may indicate by a notice delivered to the other Parties in accordance herewith.

Section 7.14 Force Majeure. Neither Party shall be deemed in default of this Agreement to the extent that any delay or failure in the performance of its obligations under this Agreement results from any cause beyond its reasonable control and without its fault or negligence, including acts of God, acts of civil or military authority, embargoes, acts of terrorism, epidemics, war, riots, insurrections, fires, explosions, earthquakes, floods, unusually severe weather conditions, labor problems or unavailability of parts, or, in the case of computer systems, any failure in electrical or air conditioning equipment. In the event of any such excused delay, the time for performance shall be extended for a period equal to the time lost by reason of the delay.

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Section 7.15 Termination. Notwithstanding anything to the contrary contained herein, this Agreement may be terminated at any time prior to the Distribution by and in the sole discretion of the Sara Lee Board without the prior approval of any Person. In the event of such termination, this Agreement shall forthwith become void, and no Party shall have any liability to any Person by reason of this Agreement.

Section 7.16 Successors and Assigns. The CoffeeCo Parties may not assign any of their rights or obligations under this Agreement to another Person without the consent of Sara Lee. Subject to the foregoing, (a) this Agreement and all the terms and provisions hereof shall be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns, and (b) each Party shall require any Person or Persons that, as a result of any merger, purchase of assets, reorganization or other transaction, acquires or succeeds to all or substantially all of its business or assets to assume its obligations under this Agreement pursuant to a written assumption agreement in form and substance reasonably satisfactory to each other Party.

Section 7.17 Construction. The descriptive headings herein are inserted for convenience of reference only and are not intended to be a substantive part of or to affect the meaning or interpretation of this Agreement. Whenever required by the context, any pronoun used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular forms of nouns, pronouns, and verbs shall include the plural and vice versa. Reference to any agreement, document, or instrument means such agreement, document, or instrument as amended or otherwise modified from time to time in accordance with the terms thereof, and if applicable hereof. The use of the words “include” or “including” in this Agreement shall be by way of example rather than by limitation. The use of the words “or,” “either” or “any” shall not be exclusive. The words “hereby,” “herein,” “hereunder” and words of similar import refer to this Agreement as a whole (including any Schedules, Attachments and Exhibits) and not merely to the specific section, paragraph or clause in which any such word appears. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the provisions of this Agreement. The Parties agree that prior drafts of this Agreement shall be deemed not to provide any evidence as to the meaning of any provision hereof or the intent of the Parties hereto with respect hereto.

Section 7.18 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without reference to conflict of law principles thereof.

Section 7.19 Amicable Resolution. The Parties desire that friendly collaboration will develop between them. Accordingly, they will try to resolve in an amicable manner all disputes and disagreements connected with their respective rights and obligations under this Agreement in accordance with Article XII of the Separation Agreement mutatis mutandis.

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Section 7.20 Arbitration. Except for suits seeking injunctive relief or specific performance, in the event of any dispute, controversy or claim arising under or in connection with this Agreement (including any dispute, controversy or claim relating to the breach, termination or validity thereof), the Parties agree to submit any such dispute, controversy or claim to binding arbitration in accordance with Article XII of the Separation Agreement mutatis mutandis.

ARTICLE VIII DEFINITIONS

Capitalized terms used herein and not otherwise defined herein shall have the meanings set forth in the Separation Agreement. In addition, for purposes of this Agreement, the following terms shall have the following meanings:

“Affiliate” means, with respect to any Person, any other Person that, at the time of determination, directly or indirectly Controls, is Controlled by or is under common Control with such Person. For purposes of this Agreement, Sara Lee and its Subsidiaries, on the one hand, and the CoffeeCo Parties and their Subsidiaries, on the other, shall be deemed to not be under common Control and accordingly shall not be Affiliates of the other for purposes hereof as of the Effective Time.

“Business Day” shall mean each weekday (Monday, Tuesday, Wednesday, Thursday and Friday), excluding all federally mandated holidays in the United States.

“CPi” shall mean Computer Packages, Inc.

“CoffeeCo Materials” shall mean all materials (whether printed, electronic, or otherwise), including packaging, catalogs, brochures, circulars, advertising materials, point of sale materials, sampling materials, sales collateral materials, publicity and public relations, signage, websites, website content, social media content, stationery, business cards, business forms and similar organizational items, that are produced by or on behalf of the CoffeeCo Parties or any of their Affiliates and used to identify, operate, market, promote, publicize, or advertise the CoffeeCo Parties, any of their Affiliates, or any of their respective products or services, or the CoffeeCo Business.

“Corporate Name License” shall mean the rights and obligations hereunder in connection with the license to the CoffeeCo Parties to use the Sara Lee Marks in corporate names that is set forth in Section 1.4.

“Licensed Materials” shall mean any CoffeeCo Materials bearing, displaying or otherwise using the Sara Lee Marks that are in the possession or under the control of, the CoffeeCo Parties or any of their Affiliates as of the Effective Time.

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“Materials” shall mean all materials (whether printed, electronic, or otherwise), including packaging, catalogs, brochures, circulars, advertising materials, point of sale materials, sampling materials, sales collateral materials, publicity and public relations, signage, websites, website content, social media content, stationery, business cards, business forms and similar organizational items.

“Sara Lee Marks” shall mean the Trademarks set forth on Schedule 1.

“Sara Lee Materials” shall mean all materials (whether printed, electronic, or otherwise), including packaging, catalogs, brochures, circulars, advertising materials, point of sale materials, sampling materials, sales collateral materials, publicity and public relations, signage, websites, website content, social media content, stationery, business cards, business forms and similar organizational items, that are produced by or on behalf of Sara Lee or any of its Affiliates and used to identify, operate, market, promote, publicize, or advertise Sara Lee, any of its Affiliates, or any of their respective products or services, or the Sara Lee Business.

“Sara Lee Trademarks” shall mean all Trademarks owned by Sara Lee including the Sara Lee Marks.

“Territory” shall mean all territory throughout the world.

“Trademark Database” shall mean CPi SQL Server 2000 R-4 Combined System for Patents, Trademarks and General Matters (system version EU.R4.2000.2003.008.036 (December 29, 2011), upgraded to CPi SQL Server 2005) and the data contained therein.

“Trademarks” shall mean trademarks, service marks, trade names, logos and slogans (and all applications for registration, translations, adaptations, derivations and combinations of the foregoing) and Internet domain names, including the goodwill relating to each of the foregoing.

“Trademark License” shall mean the rights and obligations hereunder in connection with the license to the CoffeeCo Parties to use the Sara Lee Marks that is set forth in Section 1.1 of this Agreement.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their authorized representatives as of the date first written above.

[Signature Page to Intellectual Property Separation Agreement]

SARA LEE CORPORATION

By: /s/ Mark A. Garvey Name: Mark A. Garvey

Title: Executive Vice President and Chief Financial Officer

[Signature Page to Intellectual Property Separation Agreement]

DE US, INC.

By: /s/ Mark S. Silver Name: Mark S. Silver Title: President

[Signature Page to Intellectual Property Separation Agreement]

D.E MASTER BLENDERS 1753 B.V.

By: /s/ Michel M.G. Cup Name: Michel M.G. Cup Title: Chief Financial Officer

Exhibit 4.18

LICENSE AND SERVICES AGREEMENT

by and between

SARA LEE/DE B.V.

and

JMS FOODSERVICE, LLC

Dated as of January 3, 2012

Portions of this exhibit have been omitted pursuant to a request for confidential treatment filed with the Securities and Exchange Commission. The omissions have been indicated by asterisks (“*****”), and the omitted text has been furnished separately to the

Securities and Exchange Commission.

TABLE OF CONTENTS

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Page

ARTICLE 1 DEFINITIONS AND INTERPRETATION 1

Section 1.1 Definitions 1 Section 1.2 Interpretation 6

ARTICLE 2 GRANT OF RIGHTS 6

Section 2.1 Grant of Licensor’s Existing Liquid Coffee Technology License 6 Section 2.2 Grant of ***** 7 Section 2.3 Grant of Trademark License 7 Section 2.4 Improvements 7 Section 2.5 Sublicenses 8 Section 2.6 Subcontracting 8 Section 2.7 Ownership and Retention of Rights 8 Section 2.8 *****’s First Right of Negotiation 9 Section 2.9 *****’s First Right of Negotiation 9 Section 2.10 Procedure for First Right of Negotiation 9

ARTICLE 3 USE OF THE LICENSED TRADEMARKS 10

Section 3.1 Marking/Appearance 10 Section 3.2 Prohibited Use; No Contest 11 Section 3.3 Quality Control 11 Section 3.4 Co-Branding 12 Section 3.5 Recall of Brand License Products; Third Party Notice 12

ARTICLE 4 SUPPORT SERVICES AND PRODUCT DEVELOPMENT SERVICES 13

Section 4.1 Support Services 13 Section 4.2 Term of Support Services 13 Section 4.3 ***** 13 Section 4.4 Term of Product Development Services 13

ARTICLE 5 PAYMENTS 13

Section 5.1 ***** Payments 13 Section 5.2 ***** Payments 14 Section 5.3 Payments; ***** Statements 14 Section 5.4 Late Payments/ Consequences of Non-Payment 14 Section 5.5 Audits 14

ARTICLE 6 INTELLECTUAL PROPERTY MANAGEMENT 15

Section 6.1 Prosecution and Maintenance of Licensed Patents, Licensed Trademarks, and Licensee’s Improvements 15 Section 6.2 Enforcement 16 Section 6.3 Infringement 17

ARTICLE 7 CONFIDENTIAL INFORMATION 18

Section 7.1 Non-Disclosure 18 Section 7.2 Authorized Disclosure 18

ARTICLE 8 TERM, TERMINATION AND SUSPENSION OF RIGHTS 19

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Section 8.1 Agreement Term 19 Section 8.2 Existing Liquid Coffee Technology License 19 Section 8.3 ***** 19 Section 8.4 Trademark License 21 Section 8.5 Rights of First Negotiation 21 Section 8.6 Support Services and Product Development Services 22 Section 8.7 Suspension of Trademark Rights 22 Section 8.8 Notice of Suspension Event; Consequences 22

ARTICLE 9 REPRESENTATIONS, WARRANTIES AND COVENANTS 23

Section 9.1 Representations and Warranties 23 Section 9.2 Disclaimer of Warranties 23 Section 9.3 Licensee Restrictive Covenant 24 Section 9.4 Mutual Non-Solicitation 25

ARTICLE 10 INDEMNIFICATION 25

Section 10.1 Indemnification of Licensor 25 Section 10.2 Indemnification of Licensee 25 Section 10.3 Indemnification Procedure 25

ARTICLE 11 DISPUTE RESOLUTION 25

Section 11.1 Dispute 25 Section 11.2 Arbitration Procedures 26 Section 11.3 Appointment of Arbitrator 26 Section 11.4 Number and Definition of Disputes 26 Section 11.5 Relief 26 Section 11.6 Timing of an Arbitrator’s Decision 26 Section 11.7 Venue 26 Section 11.8 Governing Law 26 Section 11.9 Language 26 Section 11.10 Evidence 26 Section 11.11 Fees and Costs 26 Section 11.12 Ruling on Suspension 27 Section 11.13 Ruling on Multiple Disputes 27 Section 11.14 Findings and Conclusions 27 Section 11.15 Confidentiality 27

ARTICLE 12 MISCELLANEOUS 27

Section 12.1 Governing Law 27 Section 12.2 Waiver 27 Section 12.3 Notices 27 Section 12.4 No Third Party Beneficiaries 29 Section 12.5 Authority to Bind 29 Section 12.6 Amendment; Entire Agreement 29 Section 12.7 Severability 29 Section 12.8 Assignment and Transfer 29 Section 12.9 Counterparts 29 Section 12.10 Further Actions 29 Section 12.11 Force Majeure 30 Section 12.12 Survival 30

LIST OF SCHEDULES

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Schedule 2.6 Approved SubcontractorsSchedule 4.1 ***** Schedule 4.3 *****Schedule 5.1 ***** Schedule 5.2 ***** Schedule 5.3 *****

LIST OF EXHIBITS

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Exhibit A ***** Exhibit B ***** Exhibit C ***** Exhibit D *****

LICENSE AND SERVICES AGREEMENT

This LICENSE AND SERVICES AGREEMENT (this “Agreement”), dated as of January 3, 2012 (the “Effective Date”), is entered into by and between SARA LEE/DE B.V. (“Licensor”), and JMS FOODSERVICE, LLC (“Licensee”). Licensor and Licensee are each sometimes referred to herein as a “Party”, and collectively, as the “Parties.”

RECITALS

WHEREAS, Sara Lee Corporation, the ultimate parent company of Licensor, and The J.M. Smucker Company, the ultimate parent company of Licensee, have entered into that certain Asset Purchase Agreement dated as of October 24, 2011 (the “Asset Purchase Agreement”), pursuant to which, The J.M. Smucker Company and its Affiliates (the “Smucker Entities”) purchased certain assets of Licensor’s Liquid Coffee Business, Premium R&G Business and TC&C Business all within the Applicable Territory (all terms as defined in the Asset Purchase Agreement);

WHEREAS, on the Effective Date, Sara Lee Corporation and the respective Smucker Entities have executed, or are to execute, other Transaction Documents including this Agreement, which shall be entered into by Licensor as legal successor of Sara Lee Corporation with respect to the coffee business;

WHEREAS, Licensor is engaged, inter alia, in the development and commercialization of liquid coffee technologies and possesses certain intellectual property, experience and expertise directed toward such technologies; and

WHEREAS, the Parties desire and intend that, pursuant to all of the field, territory, scope, term, payment and other restrictions and obligations set forth in this Agreement: (i) Licensor shall license to Licensee rights under certain liquid coffee related technologies and certain trademarks for use in the development and commercialization of certain products; (ii) Licensee shall license to Licensor rights under certain improvements to liquid coffee related technologies developed by Licensee; (iii) the Parties shall grant to each other certain rights of first negotiation related to specified coffee technologies; and (iv) Licensor shall provide certain support and product development services to Licensee related to liquid coffee technologies, all as further described herein.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

ARTICLE 1 DEFINITIONS AND INTERPRETATION

Section 1.1 Definitions. For all purposes of this Agreement, the following terms when used herein with initial capital letters shall have the following meanings set forth below. Terms having initial capital letters not otherwise defined herein shall have the respective meanings given to them in the Asset Purchase Agreement.

“Affiliate” shall have the meaning set forth in Section 1.01 of the Asset Purchase Agreement.

“Applicable Laws” shall have the meaning set forth in Section 1.01 of the Asset Purchase Agreement.

“Brand License Products” shall mean any of the following beverage products sold in the Field on the Effective Date: (a) Roast and Ground Coffee Products marketed under the brand name *****; (b) the Branded Liquid Coffee Products; (c) tea sold under the brand name *****; (d) cocoa, cappuccino and steamers sold under the brand name *****; and (e) orange juice sold under the brand name *****.

“Branded Liquid Coffee Products” shall mean liquid concentrate products for coffee, chocolate, tea and milk sold under the brand name *****.

“Change of Control” shall mean with respect to a Party any (a) consolidation or merger of such Party or any entity that possesses directly or indirectly the power to direct or cause the direction of the management and policies of such Party, whether through the ownership of voting securities, by trust, management, agreement, contract or otherwise (each, a “Party Company”) with or into another entity or entities (whether or not such Party Company is the surviving entity), as a result of which one equity holder, or a group of equity holders acting in concert, possess the voting power (under ordinary circumstances) to elect a majority of such Party Company’s board of directors (or other equivalent managing group), excluding any such consolidation or merger with or into an Affiliate of such Party, (b) any sale or transfer by any Party Company of all or substantially all of its assets (excluding any such sale to an Affiliate), (c) any sale, transfer or issuance or series of sales, transfers or issuances of shares or other equity interests of any Party Company by such Party Company or the equity holders thereof, as a result of which one equity holder, or a group of equity holders acting in concert, possess the voting power (under ordinary circumstances) to elect a majority of such Party Company’s board of directors (or other equivalent managing group) (excluding any such sale to an Affiliate), or (d) the bankruptcy, liquidation or dissolution of a Party Company; provided that, a ***** (as defined in Section 8.3(b)) shall not be deemed a Change of Control. Notwithstanding the foregoing, the Parties agree that the Spin-Off of Licensor as described in Section 13.01 of the Asset Purchase Agreement shall not constitute a “Change of Control” of Licensor for the purposes of this definition.

“Commercialize” (together with its correlatives “Commercializing” and “Commercialization”) shall mean, with respect to any products, the act of manufacturing (including—in the context of Liquid Coffee and Liquid Coffee Products—selecting, blending, processing, roasting, and grinding coffee beans and preparing Liquid Coffee therefrom), producing, making, importing, marketing, labeling, selling, offering for sale, distributing, transferring, packaging, advertising, online activities, promoting, copying, publishing, displaying, using, and/or otherwise commercially exploiting such products, including through any other means now or hereafter developed.

“Confidential Information” shall mean confidential and proprietary non-public information and materials exchanged by the Parties or to which a Party has access, whether in oral, written, graphic or machine-readable form, in the course of or in connection with the exercise of rights or the performance of obligations under this Agreement. For the avoidance of doubt, the terms and conditions of this Agreement shall be considered Confidential Information. The term “Confidential Information” shall exclude information that, and the obligations of confidentiality, non-use, and nondisclosure contained herein shall not extend to such of the Confidential Information that, (a) at the time of its receipt by Receiving Party is already in, or subsequently comes into, the public domain through no fault of Receiving Party or any of its Representatives (but only to the extent that it so becomes available), (b) is already in Receiving Party’s possession, (c) is independently developed by employees of the Receiving Party, or any of its Affiliates, without access to the Confidential Information disclosed pursuant to this Agreement; or (d) becomes available to Receiving Party without restriction on disclosure from a third party who has a lawful right to make a disclosure thereof (“Confidential Information Exceptions”);

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however, specific information shall not be deemed to be within the exceptions (a)-(d) immediately above merely because it is embraced by general information within such exception(s), nor shall a combination of features be deemed within such exception(s) merely because the individual features of such combination are within such exception(s).

“Develop” (together with its correlatives “Developing” and “Development”) shall mean, with respect to any products, activities related to the manufacturing, producing, making or using of such products carried out with the intention of making a discovery that could result in new products and procedures or improvements to existing products and procedures, inclusive of those associated with and extending beyond the theoretical or practical aspects of a concept, design, discovery, or Invention, which could lead to Commercialization of said products; provided that Develop expressly excludes the Commercialization of said products.

“Enforcement Action” shall mean any third party action or proceeding, including infringement, opposition, revocation, invalidity, or cancellation actions, that might be brought with respect to an infringement or dilution of any of the Licensed Intellectual Property or in relation to any act or thing which might materially harm the validity or enforceability of, or the goodwill associated with, any of the Licensed Intellectual Property.

“Field” shall mean the foodservice trade channel *****.

“Governmental Entity” shall mean any court, administrative agency or commission or other governmental authority or instrumentality of applicable jurisdiction, whether domestic or foreign.

“Improvement(s)” shall mean any advances, modifications, enhancements, variations, revisions, adaptations and extensions to Technology or Liquid Coffee Products (whether or not patentable) that are Developed after the Effective Date, including, without limitation, those of the above that (a) improve performance of a process or good; (b) reduce the cost of materials, production, manufacturing or associated costs of a process or good; (c) expand the applications or increase the functionality of a process or good; or (d) increase or enhance the marketability or commercial acceptance of a process or good.

“Invention” shall mean a previously undiscovered method, device, process, formula, algorithm, or similar advance, including new Improvements to existing forms of the foregoing.

“Licensed Intellectual Property” shall mean the: (a) Licensor’s Existing Liquid Coffee Technology; (b) *****; (c) Licensed Trademarks, (d) Licensed Trade Dress; and (e) Patents and Trade Secrets (as defined in the Asset Purchase Agreement) not transferred to Licensee pursuant to the Asset Purchase Agreement that are owned by Licensor or in-licensed by Licensor from a third party (provided that the governing third-party license would not prohibit sublicensing hereunder) and that are used as of the Effective Date in connection with the Development and Commercialization of Liquid Coffee Products within the Territory and within the Field; provided that, for the avoidance of doubt, Licensed Intellectual Property excludes all intellectual property and third-party licenses of intellectual property that are transferred to Licensee or its Affiliates pursuant to the Asset Purchase Agreement as part of the Acquired Assets (as defined therein).

“Licensed Patents” shall mean (a) the patents and patent applications set forth on *****; (b) patents and patent applications claiming priority thereto, whether or not filed before or after the Effective Date, including provisionals, continuations, continuations-in-part, and divisions; (c) all patents and registrations issuing therefrom; (d) re-examinations, renewals, reissues, and extensions allowed on any of the foregoing, and (e) all other patents and patent applications disclosing or having any claims covering any of the Licensed Intellectual Property, each of the foregoing (a) - (e) solely limited to the respective patents and patent applications in the Territory.

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“Licensee’s Existing Coffee Know-how” shall mean any Intellectual Property (as defined in the Asset Purchase Agreement) owned by Licensee or any of its Affiliates as of the Effective Date, used in or pertaining to the manufacturing, dispensing, or packaging of any Liquid Coffee products or Roast and Ground Coffee Products, including new or improved methods, processes, manufacturing techniques, specifications, formulations, compositions, preparations, presentations, or packaging of Liquid Coffee, whether or not protected or protectable as a trade secret, patent, trademark or copyright; which is owned by Licensee or any of its Affiliates as of the Effective Date.

“*****” shall mean *****.

“Licensor’s Existing Liquid Coffee Technology” shall mean the Technology, including Licensed Patents, owned by Licensor as of the Effective Date, and which, prior to the Effective Date, was used in the manufacturing (including selecting, blending, processing, roasting, and grinding coffee beans and preparing Liquid Coffee therefrom), dispensing, or packaging of Branded Liquid Coffee Products in the Territory and in the Field; provided that, *****.

“*****” shall mean *****.

“Licensed Trademarks” shall mean the trademarks set forth on *****.

“Licensed Trade Dress” shall mean the layout, designs and coloring used on the packaging of the Brand License Products as of the Effective Date, which use shall comply with the Brand Standards Manual set forth in *****.

“Liquid Coffee” means liquid coffee concentrate in any form, including iced and ambient liquid coffee concentrate.

“Liquid Coffee Products” shall mean any Liquid Coffee product and liquid concentrate products for chocolate, tea and milk within the Liquid Coffee Business, including the Branded Liquid Coffee Products and food products containing Liquid Coffee together with any improvements, enhancements, or modifications and derivatives and byproducts thereof that are derived from or otherwise based on the Licensed Intellectual Property or the Licensed Patents. For the purposes of this definition, “Liquid Coffee Business” shall mean the business conducted by Licensee and/or its Affiliates on or after the Effective Date hereof relating to the manufacture, marketing, distribution and sale of Liquid Coffee and liquid concentrates for chocolate, tea and milk in the Field and in the Territory (including through the use of authorized third party contract manufacturers, co-packers, distributors, fulfillment centers and other third parties).

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“Person” means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a Government Entity or any department, agency or political subdivision thereof.

“Roast and Ground Coffee Products” means dry coffee products comprising packaged roasted whole or ground coffee beans.

“Technology” shall mean any Inventions, technologies or ideas, that are necessary for or used in the Development, manufacture or Commercialization of Liquid Coffee or Liquid Coffee Products, including new or improved methods, processes, manufacturing techniques, specifications, formulations, compositions, preparations, presentations, or packaging of Liquid Coffee or Liquid Coffee Products, whether or not protected or protectable as a trade secret, patent, trademark or copyright; provided that *****.

“Territory” shall mean *****.

“Transaction Documents” shall have the meaning set forth in Section 1.01 of the Asset Purchase Agreement.

Definitions of the terms listed below are contained in the corresponding Section set forth below:

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Defined Term Section of Agreement

Agreement Preamble***** Payments Schedule 5.2Asset Purchase Agreement RecitalsBusiness Development Manager 4.1Coffee Developer 9.4Dispute 11.1Effective Date PreambleEvaluation Period 2.10(b)Existing Liquid Coffee Technology License 2.1***** 2.2Infringement Notice 6.2(a)Licensee PreambleLicensee Restrictive Covenants Section 9.3(b)Licensee Trademarks 3.4Licensor PreambleLosses 10.1Offering Party 2.10(a)Party/Parties PreambleProceeding 6.3Quality Standards 3.3(b)Recall 3.5(a)Receiving Party 2.10(a)

Section 1.2 Interpretation. The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.

(a) Whenever the words “include”, “includes” or “including” are used in this Agreement they shall be deemed to be followed by the words “without limitation.”

(b) The words “hereof”, “herein” and “herewith” and words of similar import shall, unless otherwise stated, be construed to refer to this Agreement as a whole and not to any particular provision of this Agreement, and article, section, paragraph, exhibit and schedule references are to the articles, sections, paragraphs, exhibits and schedules of this Agreement unless otherwise specified.

(c) Specific references to certain breaches as “material breaches” shall not be construed to mean that other breaches are not material breaches if not so identified.

(d) All Exhibits or Schedules annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth herein.

(e) A reference to any Party to this Agreement or any other agreement or document shall include such Party’s successors and permitted assigns.

(f) The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provisions of this Agreement.

ARTICLE 2 GRANT OF RIGHTS

Section 2.1 Grant of Licensor’s Existing Liquid Coffee Technology License. Subject to the terms and conditions of this Agreement including the termination provisions set forth in Section 8.2, Licensor hereby grants to Licensee a *****, with the right to grant sublicenses subject to Section 2.5 and the right to Develop Improvements thereto subject to Section 2.4, in and to Licensor’s Existing Liquid Coffee Technology and Improvements thereto ***** (the “Existing Liquid Coffee Technology License”).

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Defined Term Section of Agreement

Restricted Period 9.3(a)***** Payments Schedule 5.1***** Reports 5.3Suspension Event 8.7Support Services 4.1***** 8.3(b)Third Party Notice 3.5(b)Trademark License 2.3

Section 2.2 Grant of *****. Subject to the terms and conditions of this Agreement including the termination provisions set forth in Section 8.3, for a period of *****, Licensor hereby grants to Licensee an ***** in the Territory and solely within the Field, with the right to ***** subject to Section 2.5 and the right to Develop Improvements thereto subject to Section 2.4, in and to ***** and Improvements thereto solely to the extent necessary for ***** in the Field and in the Territory (the “*****”).

Section 2.3 Grant of Trademark License. Subject to the terms and conditions of this Agreement, including the termination provisions set forth in Section 8.4, Licensor hereby grants to Licensee: (a) an exclusive, royalty-free license, with the right to grant sublicenses subject to Section 2.5, in and to the ***** Licensed Trademarks set forth in Section 1 of ***** in the Field and in the Territory for a period of ***** in connection with the Commercialization of the Brand License Products in the Territory; and (b) an exclusive, royalty-free license, with the right to grant sublicenses subject to Section 2.5, in and to the ***** Licensed Trademarks set forth in Section 2 of ***** and the Licensed Trade Dress in the Field and in the Territory for a period of *****, thereafter converting to a perpetual non-exclusive license, in connection with the Commercialization of the ***** Brand License Products in the Field and in the Territory (collectively, the “Trademark License”). During the periods set forth herein, Licensor shall not use or license to any third party the right to use in the Field and in the Territory, any trademark, trade name, logo, domain name, business name or other designation that consists of or comprises of the Licensed Trademarks or combinations of the Licensed Trademarks with other trademarks, or any trademark which is confusingly similar to any of the Licensed Trademarks.

Section 2.4 Improvements. (a) Disclosure. During the Term of this Agreement, Licensee shall promptly conceptually discuss with Licensor all

Improvements to Licensor’s Technology that are developed by or on behalf of Licensee or that are acquired by Licensee after the Effective Date of this Agreement and if agreed to by Licensor, would be fully disclosed as part of a specific Improvement to Licensor’s Technology. *****.

(b) License-back to Licensor. Subject to the terms and conditions of this Agreement, Licensee hereby grants to Licensor a perpetual, non-exclusive license, with the right to grant sublicenses subject to Section 2.5 and the right to make Improvements thereto (which Improvements shall promptly be conceptually discussed with, and if agreed to by Licensee, fully disclosed to Licensee in writing; for the avoidance of doubt, *****.

(c) Exceptions. The disclosure provision of Section 2.4(a) and the license-back provision of Section 2.4(b) shall only apply to (a) Technology exclusively Developed by or on behalf of Licensee for Liquid Coffee, but only to the extent of the specific Improvements (to the extent disclosed pursuant to Section 2.4(a)) to Licensor’s Technology, and (b) Technology exclusively Developed by or on behalf of Licensee for Liquid Coffee based on or derived from Confidential Information of Licensor, but only to the extent of the specific Improvements to Licensor’s Confidential Information (to the extent disclosed pursuant to Section 2.4(a)). *****.

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Section 2.5 Sublicenses. Licensee and Licensor shall each have the right to grant sublicenses solely to its Affiliates (without rights to further sublicense) under the licenses set forth in Section 2.1, Section 2.2, and Section 2.3 (with respect to Licensee) and Section 2.4 (with respect to Licensor), provided each Party shall ensure that its sublicensed Affiliates shall be subject to a written agreement with terms and conditions that are consistent with, and no less protective of the sublicensor party than, the terms and conditions hereunder and each Party granting a sublicense hereunder shall provide the other Party with a copy of any such written sublicense and any amendments thereto within thirty (30) days of execution. Any action taken by a sublicensed Affiliate of a Party that, if taken by such Party itself would be a breach of this Agreement, shall be deemed to be a breach by such Party of this Agreement. Each Party is and shall remain jointly and severally responsible for each of its sublicensed Affiliates’ financial and other obligations under this Agreement. Licensor hereby consents to Licensee’s packaging manufacturers’ or other third party contractors’ use of the Licensed Trademarks for the production of packaging and marketing and promotional materials with respect to the Licensed Goods; provided that such use is in accordance with the terms of this Agreement.

Section 2.6 Subcontracting. Licensee’s right to have Liquid Coffee Products made on its behalf using the Existing Liquid Coffee Technology or the *****, in whole or in part, shall be limited to use of those subcontractors pre-approved by Licensor and set forth on Schedule 2.6, as may be amended from time to time by agreement of the Parties (which agreement will not be unreasonably withheld, conditioned or delayed for non-coffee liquid concentrates) in response to Licensee’s request via notice to Licensor that additional subcontractors be added.

Section 2.7 Ownership and Retention of Rights. (a) Of Licensed Intellectual Property. Licensee acknowledges that, as between the Parties, except with respect to the

licenses and first rights of negotiation granted to Licensee herein, Licensor owns all right, title, and interest in and to the Licensed Intellectual Property, including all Improvements made thereto solely by Licensor, and the goodwill, including future goodwill, associated with the Licensed Trademarks. Except as expressly stated in this Agreement, and Section 5.05 of the Asset Purchase Agreement, no other rights, ownership interest or licenses, express or implied, are granted by Licensor to Licensee in respect of the Licensed Intellectual Property and Licensor does not grant to the Licensee any right or license in any Intellectual Property of Licensor other than the Licensed Intellectual Property, whether by implication, estoppel or otherwise. All rights in any and all rights to Intellectual Property of Licensor not expressly granted to Licensee under this Agreement are reserved to Licensor. Any use of the Licensed Intellectual Property outside the scope of the limited licenses granted in this Article 2 is expressly prohibited and shall, for the avoidance of doubt, where such prohibited use continues uncured for sixty (60) days, constitute a material breach of this Agreement, and further Licensee covenants and agrees it shall not use, and shall cause its Affiliates not to use, the Licensed Intellectual Property outside the scope of the licenses granted herein. Subject to Licensor’s non-compete obligations in Section 6.04 of the Asset Purchase Agreement and the first rights of negotiation obligations of Licensor in Section 2.8 of this Agreement, nothing in this Agreement is intended to or shall prohibit, limit or encumber Licensor in any way from using, licensing the use, or taking any other actions with respect to (i) any of the Licensed Intellectual Property (x) outside of the Field within the Territory or (y) in any field outside of the Territory, or (ii) the selecting, blending, processing, roasting and grinding components of Licensor’s Technology, whether during or after the term of this Agreement.

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(b) Of Improvements and Licensee’s Existing and *****. Licensor acknowledges that, as between the Parties, except with respect to the licenses and first rights of negotiation granted to Licensor herein, Licensee and Licensee’s Affiliates own all right, title, and interest in and to (i) Licensee’s Existing Coffee Know-how, (ii) *****, and (iii) Improvements made solely by Licensee. Except as expressly stated in this Agreement, no other rights, ownership interest or licenses, express or implied, are granted by Licensee to Licensor in respect of Licensee’s Improvements, Licensee’s Existing Coffee Know-how or *****, and Licensee does not grant to Licensor any right or license in any other Intellectual Property of Licensee other than the foregoing, whether by implication, estoppel or otherwise. All rights in any and all Intellectual Property of Licensee not expressly granted to Licensor under this Agreement are reserved to Licensee. Any use of Technology of Licensee or Technology of Licensee’s Affiliates (collectively “Licensee’s Technology”) outside the scope of the limited licenses granted in this Article 2 is expressly prohibited and shall, for the avoidance of doubt, where such prohibited use continues uncured for sixty (60) days, constitute a material breach of this Agreement, and further Licensor covenants and agrees it shall not use Licensee’s Technology outside the scope of the licenses granted herein. Subject to (v) Licensee’s non-compete obligations in Section 9.3, (w) the rights of first refusal obligations of Licensee in Section 2.9, and (x) the obligation to license Licensee’s or its Affiliates’ Improvements to Licensor in Section 2.4, nothing in this Agreement is intended to or shall prohibit or encumber Licensee from using, licensing the use, or taking any other actions with respect to (y) Licensee’s Existing Coffee Know-how and ***** separate and apart from the Licensed Intellectual Property whether inside or outside of the Territory and whether inside or outside of the Field, or (z) the selecting, blending, processing, roasting and grinding components of Licensee’s Technology, whether during or after the term of this Agreement.

Section 2.8 *****’s First Right of Negotiation. Subject to the terms and conditions of this Agreement, for a period of *****, prior to *****’s and/or its Affiliates’ engaging in the sale or distribution of (a) *****, or (b) *****, ***** shall offer ***** the first right to negotiate (subject to any other existing third party rights of like kind or nature) an ***** agreement to sell or distribute such products *****.

Section 2.9 *****’s First Right of Negotiation. Subject to the terms and conditions of this Agreement, for a period of *****, prior to *****’s and/or its Affiliates’ engaging in the sale or distribution of *****, ***** shall offer ***** the first right to negotiate (subject to any other existing third party rights of like kind or nature) an ***** agreement to sell or distribute such products in *****.

Section 2.10 Procedure for First Right of Negotiation. (a) In the event that (i) the Party offering the first right of negotiation (the “Offering Party”) to the other Party (the

“Receiving Party”) desires to initiate such negotiation or (ii) the Receiving Party desires to initiate such negotiation, the Offering Party shall provide to the Receiving Party documentation and materials pertaining to the applicable product opportunity as reasonably necessary in the Offering Party’s sole discretion to allow such Receiving Party to determine if it desires to exercise its first right to negotiate, provided that such documentation and materials shall automatically be deemed to constitute the Offering Party’s Confidential Information and shall not be disclosed to any third party except with the prior written consent of the Offering Party and shall not be used by the Receiving Party for any purpose other than the purpose of evaluating the product opportunity and negotiating an agreement regarding the same in accordance with this Section 2.10.

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(b) The Receiving Party shall advise the Offering Party of its decision to exercise its first right to negotiate in writing within a commercially reasonable timeframe, not to exceed thirty (30) days after receipt of such documentation and materials (the “Evaluation Period”). In the event the Receiving Party declines or fails to exercise its first right to negotiate within the Evaluation Period, the Offering Party shall be free to enter into an agreement with a third party with respect to the applicable product opportunity. If the Receiving Party does not deliver such written notice within the Evaluation Period, or if the Receiving Party otherwise expressly waives its right under this Section 2.10, the Offering Party shall have the right to pursue such product opportunity either itself or with any third party, without any further obligation to the Receiving Party.

(c) If the Receiving Party delivers written notice electing to exercise its first right to negotiate, then the Parties shall use their commercially reasonable efforts to negotiate and enter into definitive agreements for such product opportunities as soon as practicable; provided, that if the Parties do not (for whatever reason) enter into definitive agreements within ninety (90) days following the Offering Party’s receipt of the Receiving Party’s notice, then the Offering Party shall have the right to pursue such product opportunity itself or with any third Party. Nothing contained herein shall require the Offering Party to accept the commercial terms proposed by the Receiving Party during the negotiation of a definitive agreement for any product opportunity

ARTICLE 3 USE OF THE LICENSED TRADEMARKS

Section 3.1 Marking/Appearance. Licensee shall comply with all notice and marking requirements of all Applicable Laws necessary for the protection of the Licensed Trademarks, and shall use the Licensed Trademarks in a manner reasonably calculated to prevent the Licensed Trademarks from becoming generic. Without limiting the foregoing, Licensee shall (a) affix to all products, packaging material and advertising materials that bear the Licensed Trademarks, including Brand License Products, such symbols (including “TM” and ) as required or reasonably necessary to allow adequate protection of the Licensed Trademarks and the benefits thereof under Applicable Laws, and (b) use the format, color, sizing, placement and other applicable parameters of the Licensed Trademarks in accordance with Licensor’s brand and co-branding guidelines as set forth in the Brand Standards Manual attached hereto as ***** and the Co-Branding Guidelines attached hereto as *****. Licensor may, from time to time at its discretion, amend the Brand Standards Manual and the Co-Branding Guidelines to meet the brand equity needs deemed appropriate by Licensor, provided that Licensee shall receive prompt written notice of any such amendments and shall be entitled, until one (1) year after such notice, (a) to sell down its then-existing inventories of product, (b) to purchase, receive, manufacture, and sell Liquid Coffee Products in packaging for which Licensee is contractually obligated to purchase, (c) to distribute then existing inventories of promotional literature, and (d) to purchase, receive, and distribute promotional literature for which Licensee is contractually obligated to purchase, all the foregoing (a)-(d) with respect to which the branding does not reflect changed guidelines (except where changes are required to be in compliance with Applicable Laws in the Territory). Licensee acknowledges and agrees that revisions of the Brand Standards Manual and the Co-Branding Guidelines are likely to occur in connection with the Spin-Off and Licensee agrees to promptly implement instructions from Licensor with respect to any brand or co-branding revisions to Liquid Coffee Products sold by Licensee hereunder. Notwithstanding anything herein to the contrary, and except for co-branding and amended branding as described herein, Licensee shall be deemed in compliance with this Section 3.1 if it uses the Licensed Trademarks in a manner consistent in all material respects as and to the extent used by Licensor and its Affiliates in

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®

connection with its Brand License Products, packaging materials, and advertising materials in the Business immediately prior to the Effective Date or, with respect to Brand License Products which did not use Licensed Trademarks as of the Effective Date, in a manner consistent in all material respects to comparable products, in each case subject to Section 3.3. In addition, with respect to each Brand License Product bearing any of the Licensed Trademarks, Licensee shall use the following legend: “[Licensed Trademark] is a registered trademark of Licensor used under license” on all packaging of Brand License Products (but not advertising materials) bearing Licensed Trademarks. For the avoidance of doubt, Licensee may elect at any time or times during the term of this Agreement to discontinue the use of any one or more of the Licensed Trademarks.

Section 3.2 Prohibited Use; No Contest. Licensee does not have, and shall not gain, any ownership interest in the Licensed Trademarks pursuant to this Agreement. Except as otherwise authorized in writing by Licensor, Licensee shall not adopt, register or attempt to register any trademark, trade name, logo, business name or other designation in the Territory which consists of or comprises the Licensed Trademarks or combinations of the Licensed Trademarks with other Trademarks, or which is confusingly similar to any of the Licensed Trademarks without the express written agreement of Licensor. Licensee shall not contest the validity or distinctiveness of, or Licensor’s title in and to, the Licensed Trademarks. If Licensee at any time, without the prior written consent of Licensor, undertakes any of the foregoing actions, Licensee hereby assigns and transfers to Licensor, without further consideration, all of its right, title and interest thereto. This Section 3.2 shall not be construed to limit Licensor’s rights in and to any of the Licensed Trademarks under this Agreement or under Applicable Laws. For the avoidance of doubt, any breach of this Section 3.2 shall be a material breach of this Agreement.

Section 3.3 Quality Control. (a) Neither Licensor nor Licensee shall, nor shall either of them authorize any other Person to, do any act or thing that

could reasonably be expected to materially damage the reputation or goodwill of any of the Licensed Trademarks. (b) Licensee shall maintain the quality levels of the Brand License Products and any other materials bearing any of the

Licensed Trademarks at a level in all material respects at least equivalent to the quality of such products and materials sold or used by Licensor immediately prior to the Effective Date, or, if different, at a level commensurate with any Quality Standards (defined below) provided to Licensee hereunder, provided that such modifications do not impose standards more stringent or burdensome on Licensee than those standards Licensor imposes on or enforces against other licensees or itself. Without limiting the foregoing, Licensee shall maintain the quality levels of the Brand License Products (and any other materials) bearing any of the Licensed Trademarks in all material respects in accordance with the quality standards at each of the Brand License Product manufacturing plants operated by Licensor immediately prior to the Effective Date, or in the case of Brand License Products that were not produced by Licensor immediately prior to the Effective Date, in accordance with the quality standards for comparable products or as otherwise promulgated by the Licensor with respect to such products (the “Quality Standards”). Licensee shall have Brand License Products bearing any of the Licensed Trademarks produced in manufacturing facilities that operate under conditions in compliance with all Applicable Laws.

(c) Licensee shall, within a reasonably prompt period after receipt, provide to the Licensor copies of all material correspondence relating to a material health or product safety concern of any Governmental Entity relating to any of the Brand License Products which are Commercialized by Licensee bearing any of the Licensed Trademarks. For the avoidance of doubt, routine inspections or immaterial violations shall not fall within the foregoing.

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(d) Licensee shall, with expenses to be shared equally with Licensor, have an annual audit of its facilities used to manufacture Brand License Products bearing any of the Licensed Trademarks conducted by a third party with reputation or experience reasonably recognized in the industry. Licensee shall provide the copy of the executive summary of the completed third party audit and a summary of any corrective action plan to Licensor no later than thirty (30) days from the date each such annual audit occurs. If such audit should find a material deficiency in such manufacturing facilities, Licensee shall promptly take commercially reasonable steps to rectify such deficiencies.

Section 3.4 Co-Branding. Licensee has the right to join any trademark owned by Licensee and approved for co-branding as set forth on ***** hereto (the “Licensee Trademark”) with the ***** Licensed Trademarks so as to form a composite mark, and may co-brand any Brand License Product bearing any of such Licensed Trademarks with any of the Licensee Trademarks solely for a period of two (2) years from the date such co-branded Brand License Product is first Commercialized and solely during the term of the license granted in Section 2.3 for the foregoing Licensed Trademarks, provided that all co-branding uses are in accordance with the Co- Branding Guidelines set forth in ***** hereto (as the same may change from time to time as permitted in Section 3.1) and the other terms of this Agreement. For the avoidance of doubt, as between the Parties: (a) Licensee and its Affiliates own all right, title, and interest in and to any trademarks owned or controlled by Licensee and its Affiliates (and all goodwill, including future goodwill associated therewith), and the joining or co-branding of such trademarks as contemplated herein shall not convey any ownership, right, title and interest of such trademarks, express or implied; and (b) Licensor owns all right, title, and interest in and to any trademarks owned or controlled by Licensor (and all goodwill, including future goodwill associated therewith), including the Licensed Trademarks, and the joining, co-branding of such Trademarks as contemplated herein shall not convey any ownership, right, title and interest of Licensor’s Trademarks, express or implied.

Section 3.5 Recall of Brand License Products; Third Party Notice. (a) Licensee may, at its sole discretion, institute and conduct any voluntary or discretionary recall, in the Territory, of any

Brand License Product bearing any of the Licensed Trademarks. (b) If Licensee is notified by any third party in writing or otherwise (“Third Party Notice”) that a material quantity of a

Brand License Product is of poor quality, or that a material quantity of a Brand License Product is defective, or that a Brand License Product has directly or indirectly caused a serious injury or death, Licensee shall immediately notify Licensor in writing and provide Licensor with the specific details of such Third Party Notice.

(c) Each Party shall promptly notify the other if and when it has reason to believe that any Brand License Product poses or may pose a health or safety risk, or is not or may not be in material compliance with federal, state or local laws or regulations. In the event of a material risk to the health and safety of the public, Licensor may compel Licensee to implement a product withdrawal, recall, or recovery (“Recall”) of affected Brand License Products at Licensee’s expense.

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(d) Except in the event of a material risk to the health and safety of the public, Licensee shall have the exclusive right and responsibility to Recall the affected Brand License Products based on a Third Party Notice, if any, and any other applicable information, and in accordance with all Applicable Laws and rules of any applicable Governmental Entity, including the Food and Drug Administration. In the event Licensee is deciding whether to Recall a Brand License Product, Licensee (i) shall promptly provide Licensor with full and complete details of the events that gave or are giving rise to the consideration of a possible Recall of the affected Brand License Product, (ii) shall keep Licensor promptly advised of the decisions made and actions that will (or will not) be taken concerning the affected Brand License Product and its Recall, and (iii) shall provide Licensor with any announcements concerning the affected Brand License Product before the announcement is made public. Licensor shall cooperate in good faith with Licensee in connection with any Recall of a Brand License Product; provided, however, that Licensee shall reimburse Licensor for any pre-approved costs that Licensor may reasonably incur in connection with any such Recall.

ARTICLE 4 SUPPORT SERVICES AND PRODUCT DEVELOPMENT SERVICES

Section 4.1 Support Services. Licensor shall reasonably cooperate with and provide training, quality control support, brand compliance, and advice to Licensee with respect to the implementation and Commercialization of Liquid Coffee Products using Licensor’s Existing Liquid Coffee Technology, ***** and use of the Licensed Trademarks as exemplified by the activities described on Schedule 4.1 and subject to the terms of this Agreement (collectively, the “Support Services”), such Support Services to be coordinated by a business development manager of Licensor selected by Licensor at its sole discretion (the “Business Development Manager”).

Section 4.2 Term of Support Services. Subject to Section 8.6, the Support Services shall be provided at the written request of Licensee for a period of ***** from the Effective Date, which period shall be extended along with extensions of the *****.

Section 4.3 *****. *****.

Section 4.4 Term of Product Development Services. Subject to Section 8.6, the Product Development Services shall be provided in accordance with the guidelines set forth on ***** for a period of *****.

ARTICLE 5 PAYMENTS

In consideration for the Licensed Intellectual Property (including the Licensed Patents) licensed pursuant to Article 2, the Support Services to be provided by Licensor pursuant to Article 4, and all other rights and privileges granted hereunder, Licensee shall pay to Licensor the payments and royalties set forth below. For the avoidance of doubt, any failure of Licensee to make the payments required under this Article 5 that remains uncured as permitted herein shall be a material breach of this Agreement. Licensor shall provide to Licensee any and all documentation necessary to support its exclusion from any tax withholding obligation.

Section 5.1 ***** Payments. In consideration for the grant of *****, during the term of the ***** (and for such additional periods as set forth in Article 8 with respect to certain terminations of such license), Licensee shall pay to Licensor non-refundable ***** on the payment due dates and in the amounts determined in accordance with the formula set forth in Schedule 5.1 (the “***** Payments Schedule”), provided that ***** payments shall be in an amount at least equal to ***** per year for each

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year of the term of the ***** (and for such additional years as set forth in Article 8 with respect to certain terminations thereof), payable in advance in quarterly payments of ***** with the first such payment being due the ***** (collectively, the “Minimum ***** Payments”).

Section 5.2 ***** Payments. In consideration for all other obligations of Licensor in this Agreement, including *****, Licensee shall make payments to Licensor as set forth in Schedule 5.2 in accordance with the payment due dates set forth therein (the “***** Payments Schedule”).

Section 5.3 Payments; ***** Statements. Licensee shall pay any ***** due in excess of the Minimum ***** Payments under Section 5.1 to Licensor *****, such excess ***** to be measured as of ***** of each year and payable on or before ***** of each year during the term of the *****. If in any year ***** due under the ***** Payments Schedule are less than the Minimum ***** Payments for such year, then the Minimum ***** Payments made for each such year shall constitute full ***** payment for that year and no additional ***** payments shall be required for that year. All payments under this Agreement shall be made in United States Dollars by wire transfer to the account specified by Licensor. Licensee shall: (a) render ***** reports for sales of Liquid Coffee Products substantially in the format set forth in Schedule 5.3 hereto (the “***** Reports”) to Licensor on a ***** basis within ***** after each ***** during the term of the *****; and (b) remit payments of ***** due Licensor, if any, in accordance with Section 5.1 and this Section 5.3.

Section 5.4 Late Payments/ Consequences of Non-Payment. (a) If Licensor does not receive the total applicable payments due under this Article 5 as set forth herein, Licensee shall pay

interest with respect to any payments past due to Licensor at the rate of one (1%) percent per month, computed from the original due date until the date paid.

(b) In the event Licensee defaults on its obligations to make ***** Payments in accordance with all requirements set forth on the ***** Payments Schedule, then Licensor’s non-competition obligations under Section 6.04 of the Asset Purchase Agreement shall automatically terminate but Licensee shall continue to be bound by its non-competition obligations set forth in Section 9.3 hereof.

Section 5.5 Audits. Upon thirty (30) days’ prior written notice to Licensee, Licensor shall have the right to have an independent certified public accountant, selected by Licensor and acceptable to Licensee, which acceptance may not be unreasonably withheld, audit Licensee’s records pertaining to calculation of ***** due pursuant to this Agreement, during normal business hours, to verify the amounts payable hereunder; provided, however, that (a) such audit shall not take place more frequently than once per year; (b) such audit shall not cover such records for more than the preceding three (3) years; (c) any such audit shall take place at the location Licensee maintains such records, or at such other location mutually agreed; and (d) all information obtained during the audit shall constitute Confidential Information of Licensee pursuant to the terms of this Agreement. Any such audit shall be solely for the purpose of determining, and to report, compliance or non-compliance with the ***** payment requirements of this Agreement. The expenses of such audit shall be paid by Licensor unless the audit shows a ***** underpayment in excess of five percent (5%) of the amount determined to be due for the audited time period of at least one (1) year, in which case the expense of the audit shall be paid by Licensee. Licensee shall preserve and maintain all such records and accounts required for such audits for a period of five (5) years after the calendar quarter to which such records and accounts apply.

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ARTICLE 6 INTELLECTUAL PROPERTY MANAGEMENT

Section 6.1 Prosecution and Maintenance of Licensed Patents, Licensed Trademarks, and Licensee’s Improvements. (a) Responsibility; Fees. (i) Licensor shall control, and be solely responsible for all costs and fees relating to, the

prosecution and maintenance of the Licensed Patents and the Licensed Trademarks, and (ii) Licensee shall control, and be solely responsible for all costs and fees relating to, the prosecution and maintenance of Licensee’s Improvements and Intellectual Property pertaining to Licensee’s Improvements.

(b) Assistance. Licensee and Licensor will fully cooperate with each other in connection with each Party’s filing, prosecution and maintenance obligations concerning the Licensed Patents, Licensed Trademarks, and Intellectual Property pertaining to Licensee’s Improvements, in each case such cooperation to include providing reasonable access to relevant Persons and executing all documentation reasonably requested at its own cost and expense.

(c) Assumption of Responsibility. (i) Licensed Patents. In the event that ***** declines to maintain patents, file National stage patent applications, or

prosecute filed patent applications relating to the Licensed Patents during the term of the Existing Liquid Coffee Technology License and ***** then ***** shall promptly and in no event later than forty-five (45) days prior to any United States Patent and Trademark Office (or equivalent foreign office) filing deadline within the Territory, and forty-five (45) days prior to any WIPO filing deadline affecting any rights within the Territory, provide written notice to *****. ***** shall have the right upon such notice to assume such responsibilities with respect to the applicable country at its own expense, using counsel of its choice and the ownership of any such assumed patent applications or patents shall be assigned to the ***** and the Parties will prepare, as appropriate, all written documents to execute the assignment. ***** agrees to keep ***** informed as to the status of any Licensed Patents for which it assumes responsibility hereunder. If a deadline less than forty-five (45) days unexpectedly arises, ***** will be deemed to have complied with the notice provision of this Section 6.1(c)(i) if ***** provides notice to ***** of the deadline promptly after receipt.

(ii) *****’s Improvements. In the event that ***** declines to maintain patents, file National stage patent applications, or prosecute filed patent applications relating to *****’s Improvements in any country within the Territory *****, then ***** shall promptly and in no event later than forty-five (45) days prior to any United States Patent and Trademark Office (or equivalent foreign office) filing deadline within the Territory, and forty-five (45) days prior to any WIPO filing deadline affecting rights within the Territory *****, provide written notice to *****. ***** shall have the right upon such notice to assume such responsibilities with respect to the applicable country at its own expense, using counsel of its choice and the ownership of any such assumed patent applications or patents shall be assigned to the ***** and the Parties will prepare, as appropriate, all written documents to execute the assignment. ***** agrees to keep ***** informed as to the status of any ***** Patents for which it assumes responsibility hereunder. If a deadline less than forty-five (45) days unexpectedly arises, ***** will be deemed to have complied with the notice provision of this Section 6.1(c)(ii) if ***** provides notice to ***** of the deadline promptly after receipt.

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(iii) Licensed Trademarks. In the event that ***** declines to maintain one or more of the Licensed Trademarks during the term of the Trademark License, then ***** shall promptly and in no event later than forty-five (45) days prior to any United States Patent and Trademark Office (or equivalent foreign office) filing deadline within the Territory, provide written notice to *****. ***** shall have the right upon such notice to assume such responsibilities in the Territory at its own expense, using counsel of its choice, provided that the ownership of the Licensed Trademarks for which ***** has assumed responsibility shall remain unchanged unless otherwise agreed by the Parties in writing. ***** agrees to keep ***** informed as to the status of any Licensed Trademarks for which it assumes responsibility hereunder and shall provide ***** with copies of all filings and correspondence of a substantive nature that are made or sent to the United States Patent and Trademark Office and copies of all correspondence of a substantive nature from such Persons with respect to such Licensed Trademarks. ***** shall not allow any Licensed Trademark for which it assumes responsibility hereunder to lapse, become abandoned or otherwise be adversely affected or encumbered (including by entering into any co-existence agreement) without providing forty-five (45) days advance notice to *****. If a deadline less than forty-five (45) days unexpectedly arises, a Party will be deemed to have complied with the notice provision of this Section 6.1(c)(iii) if it provides notice to the other Party of the deadline promptly after receipt.

Section 6.2 Enforcement. (a) Notice. Each Party will promptly notify the other of any suspected or actual infringement, misuse or other violation by

a third party in the Territory of any of the Licensed Trademarks and Licensed Patents, and of Licensee’s Improvements (the “Infringement Notice”), and of any declaratory judgment, opposition, or similar action alleging the invalidity, unenforceability or non-infringement of the same.

(b) Rights of Enforcement. (i) Licensed Intellectual Property. ***** will have the first right to bring and control any Enforcement Action in

connection with the Licensed Intellectual Property in the Territory. The ***** shall maintain and control all Enforcement Actions at its expense, provided that where such action involves rights in the Field, ***** shall have the right to fully participate in such action with counsel of its choice at its own expense, and ***** agrees to consult with and consider all reasonable concerns of ***** in connection therewith, including with respect to the initial determination of whether any Enforcement Action should be brought. The ***** will decide in its sole discretion whether any Enforcement Action should be brought in the Territory involving rights outside of the Field or outside of the Territory, and will solely control the Enforcement Action at Licensor’s sole expense. If ***** decides not to bring or maintain an Enforcement Action pursuant to this Section 6.2(b)(i) for Licensed Intellectual Property, where such action involves rights in the Field, then ***** shall provide ***** Notice of this decision and ***** shall have the right to bring or maintain and control at its sole discretion any such Enforcement Action in the Territory by counsel of its own choice, at *****’s cost and expense; provided, further, that

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where such Enforcement Action involves Licensed Intellectual Property, ***** shall have the right to fully participate in the Enforcement Action with counsel of its choice and at *****’s expense, and ***** shall not consent to the entry of any judgment or enter into any settlement or other voluntary final disposition with respect to the Enforcement Action (including by entering into any co-existence agreement) without the prior written consent of *****.

(ii) Improvements. ***** will have the first right to bring and control any Enforcement Action in connection with *****’s Improvements and shall maintain and control all Enforcement Actions at its expense, provided that ***** shall have the right to fully participate in such action with counsel of its choice at its own expense, and further provided that ***** agrees to consult with and consider all reasonable concerns of ***** in connection therewith, including concerning the initial determination of whether any Enforcement Action should be brought. The ***** will decide in its sole discretion whether any Enforcement Action should be brought in the Territory involving rights in the Field, and will solely control the Enforcement Action at *****’s sole expense. If ***** decides not to bring or maintain an Enforcement Action pursuant to this Section 6.2(b)(ii), then ***** shall provide Licensor notice of this decision and ***** shall have the right to bring or maintain and control at its sole discretion any such Enforcement Action using counsel of its own choice, at *****’s cost and expense, ***** shall have the right to fully participate in the Enforcement Action with counsel of its choice and at *****’s expense, and ***** shall not consent to the entry of any judgment or enter into any settlement or other voluntary final disposition with respect to the Enforcement Action (including by entering into any co-existence agreement) without the prior written consent of *****. (c) Cooperation. At the request, cost and expense of the Party prosecuting any Enforcement Action hereunder, the other

Party shall provide all reasonable assistance in connection therewith, including by executing reasonably appropriate documents, cooperating in discovery and joining as a party to the action if required.

(d) Allocation of Damages. In the event that either Party recovers any amounts from any litigation or settlement resulting from an Enforcement Action pursuant to Section 6.2, such amounts shall be the sole property of the enforcing Party.

Section 6.3 Infringement. (a) Licensed Intellectual Property. If *****, or any of its Affiliates, is subject to an action, suit or other proceeding

(“Proceeding”) by a third party for infringement, misappropriation or misuse of a third party’s patent, trademark or other intellectual property rights in the Territory because of the Commercialization of the Liquid Coffee Products, Brand License Products or the Licensed Intellectual Property in the Territory, then ***** shall promptly notify ***** in writing of such Proceeding, and the Parties shall consult with each other to agree upon the course of action to be taken. Unless otherwise agreed in writing by the Parties, ***** shall undertake the defense of such Proceeding with counsel of its choice, at its own expense, in which event ***** shall have the right to be represented by advisory counsel of its own selection at its own expense. ***** and ***** shall reasonably cooperate and coordinate with each other in the defense of such Proceeding and furnish all pertinent evidence and reasonable assistance in their control. Each Party shall keep the other Party reasonably informed of all material developments in connection therewith. In the event ***** fails to

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assume the defense of such Proceeding, ***** may assume such defense with counsel of its choice at its own expense and ***** shall reimburse to ***** its reasonably-incurred actual and documented costs and fees incurred in connection with its control of such Proceeding; provided, however, that ***** will not consent to the entry of any judgment or enter into any settlement or other voluntary final disposition (including by entering into a co-existence agreement) with respect to the Proceeding without the prior written consent of *****.

(b) Improvements. If *****, or any of its Affiliates, is subject to a Proceeding by a third party for infringement, misappropriation or misuse of a third party’s patent, trademark or other intellectual property rights in the Territory because of use of any of *****’s Improvements by ***** or its sublicensees as permitted in this Agreement, then ***** shall promptly notify ***** in writing of such Proceeding, and the Parties shall consult with each other to agree upon the course of action to be taken. Unless otherwise agreed in writing by the Parties, ***** shall undertake the defense of such Proceeding with counsel of its choice, at its own expense, in which event ***** shall have the right to be represented by advisory counsel of its own selection at its own expense. ***** and ***** shall reasonably cooperate and coordinate with each other in the defense of such Proceeding and furnish all pertinent evidence and reasonable assistance in their control. Each Party shall keep the other Party reasonably informed of all material developments in connection therewith. In the event ***** fails to assume the defense of such Proceeding, ***** may assume such defense with counsel of its choice at its own expense and ***** shall reimburse to ***** its reasonably-incurred actual and documented costs and fees incurred in connection with its control of such Proceeding; provided, however, that ***** will not consent to the entry of any judgment or enter into any settlement or other voluntary final disposition (including by entering into a co-existence agreement) with respect to the Proceeding without the prior written consent of *****.

(c) Allocation of Damages. In the event that either Party recovers any amounts from any litigation or settlement resulting from a Proceeding in this Section 6.3, then such amounts shall be the sole property of the enforcing Party.

ARTICLE 7 CONFIDENTIAL INFORMATION

Section 7.1 Non-Disclosure. The Parties agree that during the term of this Agreement, and for a period of five (5) years after the expiration thereof, with respect to Confidential Information of the disclosing Party, the receiving Party will (a) maintain such Confidential Information in confidence to the same extent the receiving Party maintains its own confidential or proprietary information or trade secrets of similar kind and value, but in no event less than a reasonable degree of care; (b) subject to the provisions of this Section 7.1, not disclose such Confidential Information to any third party without the prior written consent of the disclosing Party, except for disclosures to its Affiliates who agree to be bound by obligations of non-disclosure and non-use at least as stringent as those contained in this Section 7.1; and (c) not use Confidential Information for any purpose except those purposes permitted by this Agreement.

Section 7.2 Authorized Disclosure. Notwithstanding the foregoing Section 7.1, a receiving Party may disclose Confidential Information of the disclosing Party if the receiving Party or any of its Affiliates or their respective representatives is compelled to disclose any such information to by a valid court or administrative order or by other requirements of law, provided that the receiving Party: (a) shall promptly notify the disclosing Party in writing and shall disclose only that portion of such information that is legally required to be disclosed; (b) shall cooperate with the disclosing Party at the disclosing Party’s expense in the disclosing Party’s efforts to obtain an appropriate protective order or other remedy of the disclosing Party’s election; and (c) shall obtain reasonable assurances for the confidential treatment of the Confidential Information.

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ARTICLE 8 TERM, TERMINATION AND SUSPENSION OF RIGHTS

Section 8.1 Agreement Term. The term of this Agreement shall commence on the Effective Date and shall continue until the Parties mutually agree in writing to terminate this Agreement.

Section 8.2 Existing Liquid Coffee Technology License. (a) Termination Only for Non-Payment. Licensor may, upon sixty (60) days’ prior written notice, terminate the Existing

Liquid Coffee Technology License only in the event of Licensee’s default of its obligations to make ***** Payments in accordance with all requirements set forth in the ***** Payments Schedule, and such termination shall become effective at the end of the 60-day period unless during such period the Licensee cures such default. Other than for an uncured default of its obligations to make ***** Payments in accordance with all requirements set forth in the ***** Payments Schedule, the Existing Liquid Coffee Technology License shall be *****. After such ***** period and assuming all ***** Payments in accordance with all requirements set forth in the ***** Payments Schedule have been made, the Existing Liquid Coffee Technology Licenseshall be ***** in the Territory and within the Field.

(b) Termination for *****. Licensee may terminate ***** at ***** upon *****, and such termination shall become effective at *****.

(c) Consequences of Termination. Upon termination, all rights granted to Licensee or sublicensed Affiliates under the Existing Liquid Coffee Technology License shall immediately terminate. For the avoidance of doubt, nothing herein shall be construed to release Licensee from (i) any of its payment obligations set forth on the ***** Payments Schedule (which payments shall become due on an accelerated basis such that the net present value (based on a 6% cost of capital) of all remaining payments on the ***** Payments Schedule shall be due immediately upon termination) or (ii) any of its non-competition obligations under Section 8.06 of the Asset Purchase Agreement.

Section 8.3 *****. (a) Termination for Cause. Either Party may terminate the ***** in the event of the other Party’s material breach or default

of its respective material obligations under this Agreement (including, but not limited to, Licensee’s default of its obligations to make ***** Payments in accordance with all requirements set forth in the ***** Payments Schedule and under its non-competition obligations set forth in Section 9.3, and Licensor’s material breach of Schedule 4.1 or *****) upon (i) ***** by Licensor with respect to Licensee’s default of its obligations to make ***** Payments or (ii) ***** by Licensee or Licensor with respect to any other material breach or default. Such termination shall become effective at the end of the respective periods in (i) and (ii) above unless during such period the breaching Party cures such breach or default.

(b) Termination for *****. In the event ***** that ***** (i) outside of the Field but within the Territory, and/or (ii) in any field outside of the Territory (a “*****”), then upon prompt notice thereof to the other Party and, as of the date of such transaction or within a twelve (12) month period thereafter, either Party shall have the right, in its sole discretion, to terminate the *****, which termination shall be effective immediately upon receipt of the terminating Party’s notice of termination.

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(c) Termination for *****. Each Party shall promptly provide notice to the other Party of *****. Either Party shall have the right to terminate the ***** in the event of *****. Termination shall be effective upon the ***** of the date of the terminating Party’s notice of termination.

(d) Termination for *****. Either Party may elect to terminate the ***** by delivering written notice to such effect to the other Party after *****. Termination of the ***** shall be effective on ***** of such notice of termination.

(e) Consequences of Termination. In all circumstances under which the ***** is terminated, all rights granted to ***** or sublicensed Affiliates thereunder shall terminate, non-solicitation obligations of both Parties in Section 9.4 shall terminate, and, for the avoidance of doubt, Licensee may continue on its own to Commercialize Liquid Coffee Products that have been Commercialized as of the termination date. For the avoidance of doubt, except as expressly set forth to the contrary in (i)-(vi) with respect to certain terminations, nothing herein shall be construed to release Licensee from (x) any of its ***** payment obligations set forth on the ***** Payments Schedule that accrued prior to the effective date of termination of the *****, or (y) any of its non-competition obligations under Section 8.06 of the Asset Purchase Agreement, or (z) any of its payment obligations set forth on the ***** Payments Schedule (which payments shall become due on an accelerated basis such that the net present value of all remaining payments on the ***** Payments Schedule shall be due immediately upon termination).

(i) Consequences of Termination for *****. Termination of the ***** by ***** for ***** shall *****. In all circumstances under which the ***** is terminated by ***** pursuant to Section 8.3(a), ***** shall ***** for a period of ***** from the effective date of termination.

(ii) Consequences of Termination for *****. Termination of the ***** by ***** pursuant to Section 8.3(a) shall relieve ***** of *****, but ***** shall continue for *****.

(iii) Consequences of Termination for *****. Termination of the ***** by ***** pursuant to Section 8.3(d) shall not ***** of its obligations to ***** to ***** for a period of ***** from the date of the *****. If the ***** is terminated by ***** pursuant to Section 8.3(d), then no further ***** will be due from ***** following the date of *****.

(iv) Consequences of Termination for Licensee’s *****. Upon termination of the ***** pursuant to Section 8.3(b), (x) ***** obligation to ***** shall continue for a ***** and (y) ***** shall continue for a period of *****, provided that ***** shall be limited to *****.

(v) Consequences of Termination for *****. In the event that ***** terminates the ***** for *****, or ***** terminates the ***** for *****, then (x) ***** under the ***** shall ***** and (y) ***** shall ***** for a period of *****.

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(vi) Consequences of Termination for *****. In the event that ***** terminates the ***** for *****, or ***** terminates the ***** for *****, then *****.

Section 8.4 Trademark License. (a) Termination for Cause. Licensor may terminate the Trademark License in the event of Licensee’s material breach or

default of its obligations under Article 3 of this Agreement or its obligations to make ***** Payments in accordance with all requirements set forth in the ***** Payments Schedule, upon sixty (60) days’ prior written notice. Such termination shall become effective at the end of the sixty 60-day period unless during such period Licensee cures such breach or default.

(b) Termination for Convenience. Licensee may terminate the Trademark License at any time during the term of this Agreement upon sixty (60) days’ prior written notice to Licensor, and such termination shall become effective at the end of the 60-day period.

(c) Consequences of Termination. Upon termination, all rights granted to Licensee or sublicensed Affiliates under the Trademark License shall terminate, except for the following ninety-day (90-day) sell-off period: Licensee and its Affiliates may sell or otherwise dispose of the inventory of any Branded Liquid Coffee Products then on hand or in production or for which substantial preparation for manufacture has been made or for which they are legally obligated to supply. Licensee shall destroy all remaining inventory of Brand License Products bearing any Licensed Trademark within ninety (90) days of termination.

Section 8.5 Rights of First Negotiation. (a) Termination for Cause. Upon sixty (60) days’ prior written notice, ***** may terminate *****’s First Right of

Negotiation set forth in Section 2.8 in the event of *****’s material breach or default of its obligations under this Agreement or under its *****. Such termination shall become effective at the end of the sixty 60-day period unless during such period the ***** cures such breach or default to the satisfaction of *****. Upon sixty (60) days’ prior written notice ***** may terminate *****’s First Right of Negotiation set forth in Section 2.9 in the event of *****’s material breach or default of its obligations under this Agreement or its obligations under *****. Such termination shall become effective at the end of the sixty 60-day period unless during such period the ***** cures such breach or default to the satisfaction of *****.

(b) Termination for *****. (i) Termination by *****. In the event ***** consummates a *****, as of *****, ***** shall have the right, in its

sole discretion, to terminate *****’s First Right of Negotiation set forth in *****, which termination shall be effective immediately upon ***** receipt of *****.

(ii) Termination by *****. In the event *****, that *****, as of *****, ***** shall have the right, in its sole discretion, to terminate *****’s First Right of Negotiation set forth in *****, which termination shall be effective immediately upon ***** receipt of *****.

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(c) Termination for *****. Either Party shall have the right to terminate the First Right of Negotiation granted to the other Party in the event of *****. Termination shall be effective upon *****.

Section 8.6 Support Services and Product Development Services. (a) Termination of Support Services . The Support Services and the Product Development Services shall be provided in

accordance with the terms set forth in Sections 4.2 and 4.3 respectively, subject to the termination rights set forth in Section 8.3 which shall apply mutatis mutandis.

(b) Consequences of Termination. Upon termination pursuant to clause (a) immediately above, all Support Services and Product Development Services provided by Licensor under Article 4 (and corresponding Schedules 4.1 and 4.3) shall cease, and Licensor shall have no further obligation (to the extent it has any) to Licensee with respect to such Support Services and Product Development Services. For the avoidance of doubt, nothing herein shall be construed to release Licensee from any of its (a) payment obligations set forth on the ***** Payments Schedule (which payments shall be due on an accelerated basis such that the net present value of all remaining payments on the ***** Payment Schedule shall be due immediately upon termination) or (b) any of its non-competition obligations under Section 9.3.

Section 8.7 Suspension of Trademark Rights. Each of the following occurrences shall be deemed a “Suspension Event” as relates to the specific Brand License Products at issue in the specific area of the Territory that is affected: (a) either (i) a pattern of adulteration in violation of Applicable Laws is found in any Brand License Products that are Commercialized bearing any of the Licensed Trademarks, such that it poses a significant health and safety risk as demonstrated by independent verifiable lab analysis and Licensee fails to correct the same within fifteen (15) days after receipt of such lab analysis results, or (ii) if such defect is curable but cannot be corrected within such 15-day period, Licensee has failed to prepare and begin to implement measures that can reasonably correct such defects within thirty (30) days, and such defects are not then remedied within such 30-day period; and (b) Licensee’s default of its obligations to make ***** Payments in accordance with all requirements set forth in the ***** Payments Schedule.

Section 8.8 Notice of Suspension Event; Consequences. (a) Licensor’s right to issue a notice and cause the suspension of Licensee’s rights under the Licensed Trademarks shall be

subject to the dispute resolution provisions set forth in Article 12. For the avoidance of doubt, no suspension shall occur until a determination is made that a Suspension Event has occurred in accordance with the dispute resolution mechanisms set forth in Article 12. For the avoidance of doubt, a Party’s obligations with respect to a Suspension Event shall not negate its obligations arising under Applicable Laws.

(b) Upon the occurrence of a Suspension Event in respect of any specific Brand License Product in a specific area of the Territory that is affected, after the applicable cure period has expired, Licensee shall at Licensor’s written request:

(i) immediately cease all Commercialization of such Brand License Product and use of the applicable Licensed Trademarks in respect of such Brand License Product in such part of the Territory, provided, however, that, Licensee may dispose of any such Brand License Products which are on hand or in production at the time of issuance of a suspension in a manner reasonably agreed upon by Licensor or otherwise shall destroy such Brand License Products;

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(ii) immediately cause all manufacturers, distributors, contractors and sublicensed Affiliates in respect of such Brand License Product in such affected part of the Territory to cease all Commercialization of such Brand License Product and use of the applicable Licensed Trademarks in respect of such Brand License Product, provided, however, that such parties may dispose of any such Brand License Products which are on hand or in production at the time of issuance of a suspension in a manner reasonably agreed upon by Licensor or otherwise shall destroy such Brand License Products.

(iii) suspend the breaching activity giving rise to such Suspension Event (including causing its manufacturers, distributors, contractors and sublicensed Affiliates to do so as well), provided that such suspension shall be narrowly applied, only as necessary to prevent the continuation of such specific breach (for example, if a breach affects a particular product in a particular part of a country, the suspension would affect only that specific item, as opposed to affecting other areas or related products, or if a breach affects a particular advertisement, then use of that particular advertisement would be suspended). Once the underlying violation or breach has been remedied, the cessation requirements hereunder shall no longer be applicable for the affected Brand License Product or activity.

ARTICLE 9 REPRESENTATIONS, WARRANTIES AND COVENANTS

Section 9.1 Representations and Warranties. Each Party represents, warrants and covenants that it is duly organized, validly existing and in good standing under the Applicable Laws of the jurisdiction of its formation and has the requisite power and authority to enter into and perform its obligations under this Agreement in accordance with its terms without the consent of any other Person;

(a) the execution, delivery and performance of this Agreement by it have been duly and effectively authorized by all necessary corporate or other action, as applicable;

(b) this Agreement constitutes the legal, valid and binding obligation of such Party, enforceable against it in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization or other Applicable Laws affecting creditors’ rights generally and except as by general principles of equity; and

(c) the execution, delivery and performance of this Agreement by it, does not conflict with any provision of Applicable Laws applicable to it or result in any breach of its constituent documents, any agreement with any other Person or any order, judgment or other restriction by which it may be bound.

Section 9.2 Disclaimer of Warranties. EXCEPT WITH RESPECT TO THE REPRESENTATIONS, WARRANTIES AND COVENANTS EXPRESSLY PROVIDED HEREIN (INCLUDING BUT NOT LIMITED TO THOSE PROVIDED IN SECTIONS 3.3 AND 9.1), EACH PARTY EXPRESSLY DISCLAIMS ALL REPRESENTATIONS AND WARRANTIES OF ANY KIND, WHETHER EXPRESS, IMPLIED OR STATUTORY, WITH RESPECT TO THIS LICENSE AND SERVICES AGREEMENT, INCLUDING WARRANTIES WITH RESPECT TO MERCHANTABILITY OR SUITABILITY OR FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT, AND ANY WARRANTIES ARISING FROM COURSE OF DEALING, COURSE OF PERFORMANCE OR TRADE USAGE. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, LICENSOR LICENSES THE LICENSED INTELLECTUAL PROPERTY ON AN “AS IS” BASIS.

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Section 9.3 Licensee Restrictive Covenant. (a) At all times during the term that the ***** (the “Restricted Period”), Licensee shall not, and shall cause each of its

Affiliates not to, directly or indirectly (including through any trademark licensing arrangement), engage in (whether as an owner, partner, investor, joint venturer, operator, licensor, licensee, advisor, consultant or otherwise) the business of manufacturing, marketing, selling or distributing Liquid Coffee or Liquid Coffee Products (i) outside of the Field within the Territory, or (ii) *****.

(b) If, at the time of enforcement of the covenants contained in this Section 9.3 (collectively, the “Licensee Restrictive Covenants”), a court shall hold that the duration, scope or area restrictions stated herein are unreasonable, the Parties agree that the maximum duration, scope or area reasonable shall be substituted for the stated duration, scope or area and that the court shall be allowed and directed to revise the restrictions contained herein to cover such maximum duration, scope and area permitted by Applicable Laws. Licensee has consulted with legal counsel regarding the Licensee Restrictive Covenants and based on such consultation has determined and hereby acknowledges that the Licensee Restrictive Covenants are reasonable in terms of duration, scope and area restrictions and are necessary to protect the goodwill of the Licensor’s businesses and of Licensor’s interest in the manufacture, marketing, sale and distribution of liquid coffee concentrate products outside of the Territory, and to prevent the impairment of the value retained by Licensor following the consummation of the Transactions. Licensee further acknowledges and agrees that the Licensee Restrictive Covenants are being entered into by it in connection with the Transactions and not directly or indirectly in connection with any other relationship that may exist between Licensee and/or any Licensee Affiliate, on the one hand, and Licensor, on the other hand.

(c) Notwithstanding anything to the contrary in this Agreement, if Licensee or any Licensee Affiliate breaches, or threatens to commit a breach of, any of the Licensee Restrictive Covenants, Licensor shall have the following rights and remedies, each of which rights and remedies shall be independent of the others and severally enforceable, and each of which is in addition to, and not in lieu of, any other rights and remedies available to Licensor at law or in equity:

(i) the right and remedy to have the Licensee Restrictive Covenants specifically enforced by any court of competent jurisdiction, it being agreed that any breach or threatened breach of the Licensee Restrictive Covenants would cause irreparable injury to the Licensor’s business and that money damages would not provide an adequate remedy to Licensor; and

(ii) the right and remedy to require Licensee and/or any Licensee Affiliate, jointly or severally as applicable, to account for and pay over to Licensee any profits, monies, accruals, increments or other benefits derived or received by suchperson as the result of any transactions constituting a breach of the Licensee Restrictive Covenants.

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(d) In the event of any breach or violation by Licensee or any Licensee Affiliate of any of the Licensee Restrictive Covenants, the time period of such covenant shall be tolled until such breach or violation is resolved.

Section 9.4 Mutual Non-Solicitation. Each Party covenants and agrees that during the Restricted Period, it will not and will cause its Affiliates to not, without the prior written consent of the other Party, either directly or indirectly, (i) solicit, induce or attempt to solicit or induce, whether or not for consideration, any employee, contractor or consultant (each a “Coffee Developer”) involved in the research and development process for coffee (including Liquid Coffee and Roast and Ground Coffee Products) to terminate his or her relationship with the other Party; provided, however, that general solicitations by either Party not specifically targeted at such Coffee Developer will not violate the foregoing or (ii) hire or retain, as applicable, any Coffee Developer for a period of one (1) year after such Coffee Developer’s employment with the other Party was terminated.

ARTICLE 10 INDEMNIFICATION

Section 10.1 Indemnification of Licensor. Subject to the terms of this Agreement, from and after the Effective Date, Licensee shall indemnify, defend, save and hold harmless Licensor and its Affiliates and each of its and their respective officers, directors, employees, representatives, agents and permitted successors and assigns (collectively, the “Indemnified Parties”) from and against any and all claims, losses, damages, expenses or liabilities (collectively, the “Losses”) resulting from any third party claim arising out of or related to: (a) Licensee’s or its sublicensee’s breach of this Agreement; (b) unless caused by Licensor’s breach of this Agreement or the Asset Purchase Agreement, Licensor’s negligence, or Licensor’s willful misconduct, the Commercialization by Licensee or its sublicensed Affiliates of Liquid Coffee Products and Brand License Products on or after the Effective Date; and (c) unless caused by Licensor’s breach of this Agreement or the Asset Purchase Agreement, Licensor’s negligence, or Licensor’s willful misconduct, Recalls by Licensee or its sublicensed Affiliates with respect to Liquid Coffee Products and Brand License Products.

Section 10.2 Indemnification of Licensee. Subject to the terms of this Agreement, from and after the Effective Date, Licensor shall indemnify, defend, save and hold harmless Licensee and its Indemnified Parties from and against any and all Losses resulting from any third party claim arising out of or related to Licensor’s breach of this Agreement.

Section 10.3 Indemnification Procedure. The Parties agree to cooperate fully with each other in connection with the defense, negotiation or settlement of any such legal proceeding, claim or demand that are subject to the Parties’ respective indemnification obligations herein in accordance with the indemnification procedures set forth in Section 11.06 of the Asset Purchase Agreement.

ARTICLE 11 DISPUTE RESOLUTION

Section 11.1 Dispute. In the event of any issue, dispute, controversy or claim arising out of, relating to or in connection with this Agreement including any dispute regarding its validity or termination, or the performance or breach thereof (a “Dispute”), the complaining Party shall send written notice to the other Party indicating the nature of the Dispute. Each Party will designate a senior executive officer or other authorized party as representative to resolve the Dispute within five (5) days following delivery of notice referred to in this Section 11.1. The executive representatives shall have twenty one

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(21) days from the expiration of such 5-day time period to resolve the Dispute unless the Parties agree to extend the time period. If the executive representatives cannot resolve the Dispute within the prescribed period, either Party may seek arbitration in accordance with the procedures described below.

Section 11.2 Arbitration Procedures. Any Dispute that cannot be resolved by the procedures described above shall be finally settled by arbitration administered by the International Centre for Dispute Resolution (“ICDR”), in accordance with the ICDR International Dispute Resolution Procedures in effect at the time of the arbitration, except as they may be modified herein or by later agreement of the Parties.

Section 11.3 Appointment of Arbitrator. The arbitration shall be conducted by one arbitrator to be selected by mutual agreement of the Parties, such selection to be completed within fifteen (15) days after the delivery of the notice of arbitration. If the Parties cannot mutually agree upon the arbitrator within this time period, then the arbitrator shall be appointed by the ICDR. The arbitrator shall be independent and possess expertise in the relevant area of the Dispute.

Section 11.4 Number and Definition of Disputes. The arbitration may involve one or more Disputes brought by either Party. Each Dispute must be narrowly defined by the complaining Party and included within the notice of arbitration.

Section 11.5 Relief. An arbitrator addressing a Dispute under this Agreement shall have the power to grant any reasonable relief sought by any Party to the Dispute, including any equitable or injunctive relief, including specific performance that is consistent with the terms of this Agreement and governing law, except that a Suspension Event shall be determined only in accordance with the standards set forth Section 8.7. Either Party may, without inconsistency with this arbitration provision, seek temporary or preliminary injunctive or provisional relief concerning a Dispute from a court of its choosing, to remain in effect until such time as the arbitrators resolve the Dispute. Such relief may include affirmative relief as well as relief to preserve the status quo.

Section 11.6 Timing of an Arbitrator’s Decision. It is the intent of the Parties that the arbitrator shall use his or her best efforts to issue the final award or awards within ninety (90) days of his or her appointment, unless the complexity of a Dispute reasonably requires additional time for a fair resolution, as determined by the arbitrator. In addition, the Parties may agree to extend this time limit, or the arbitrator may do so in his or her discretion if he or she determines the interest of justice so requires. Failure to adhere to these time limits shall not be a basis for challenging the award.

Section 11.7 Venue. The place of arbitration shall be London, United Kingdom.

Section 11.8 Governing Law. The law governing the interpretation and enforcement of this arbitration provision shall be the United States Federal Arbitration Act.

Section 11.9 Language. The arbitration shall be conducted in English.

Section 11.10 Evidence. The Parties agree that the arbitrator shall be guided by the International Bar Association (“IBA”) Rules on the Taking of Evidence in International Commercial Arbitration.

Section 11.11 Fees and Costs. Each Party shall bear its own attorneys’ fees, costs, and disbursements arising out of the arbitration, and shall pay an equal share of the fees and costs of the arbitrator. If a Party commences a court proceeding seeking to avoid arbitration of a Dispute and does not prevail, the other Party shall be entitled to recover its costs and reasonable attorneys’ fees in connection with such court proceeding. The foregoing sentence shall not apply to proceedings brought to confirm, modify, correct or vacate an arbitral award.

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Section 11.12 Ruling on Suspension. An award shall not include a suspension of use of the Licensed Trademarks unless the arbitrator finds that a Suspension Event has occurred pursuant to Section 8.7.

Section 11.13 Ruling on Multiple Disputes. For the avoidance of doubt, if multiple Disputes are submitted in a single arbitration, the arbitrator may rule in favor of one Party for all Disputes, or the other Party for all Disputes, or for some Disputes in favor of different Parties.

Section 11.14 Findings and Conclusions. The award rendered by the arbitrator shall include findings of fact and conclusions of law, and shall be final and binding on the Parties. Judgment on the award may be entered in any court of competent jurisdiction. Any monetary award rendered by the arbitrator shall be limited to direct and actually incurred damages, and shall exclude consequential damages, incidental damages, punitive damages, indirect damages or damages for lost profits. The arbitrators shall not have the power to reform, amend or make any material change to this Agreement or any other agreement between the Parties. Any action to confirm, modify, correct or vacate an arbitral award rendered under the terms of this Agreement shall be brought exclusively in the United States District Court for the Southern District of New York in New York City or, if it is determined that the action cannot be brought in a United States District Court, such relief shall be sought in the Supreme Court of the State of New York, New York County, in New York City. For purposes of this Section 11.14, the Parties consent to the personal jurisdiction of the United States District Court for the Southern District of New York and the Supreme Court of the State of New York, New York County, as appropriate.

Section 11.15 Confidentiality. Except as may be required by Applicable Laws or court order, the Parties shall maintain confidentiality as to all aspects of any arbitration, including its existence and results, except that nothing herein shall prevent any Party from disclosing information regarding the arbitration for purposes of enforcing this clause or the award or seeking temporary or preliminary injunctive or provisional remedies from a court of competent jurisdiction. The Parties shall obtain the arbitrator’s agreement to preserve the confidentiality of the arbitration.

ARTICLE 12 MISCELLANEOUS

Section 12.1 Governing Law. This Agreement (including any claim or controversy arising out of or relating to this Agreement) shall be governed by and construed in accordance with the laws of the State of New York without giving effect to the principles of conflicts of law thereof.

Section 12.2 Waiver. Any term or condition of this Agreement may be waived at any time by the Party that is entitled to the benefit thereof, but no such waiver shall be effective unless set forth in a written instrument duly executed by or on behalf of the Party waiving such term or condition. The failure of any Party to enforce any condition or part of this Agreement at any time shall not be construed as a waiver of that condition or part, nor shall it forfeit any rights to future enforcement thereof.

Section 12.3 Notices. All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given (a) when received if delivered personally, (b) when transmitted by facsimile (which is confirmed), (c) upon receipt, if sent by registered or certified mail (postage prepaid, return receipt requested) and (d) the day after it is sent, if sent for next-day delivery to a domestic address by overnight mail or courier, to the Parties at the following addresses:

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If to Licensor, to:

Sara Lee Corporation 3500 Lacey Road Downers Grove, IL 60515 Attention: General Counsel Telephone: (###) ###-#### Facsimile: (###) ###-####

Sara Lee/DE B.V. Vleutensevaart 100 3532 AD Utrecht The Netherlands Attention: Vice President Legal Affairs Telephone: +##-##-####### Facsimile: +##-##-#######

with a copy (which shall not constitute notice) sent concurrently to:

Kirkland & Ellis LLP 300 North LaSalle Chicago, Illinois 60054 Facsimile: ##-##-####### Attn: *****

If to Licensee, to:

JMS Foodservice, LLC c/o The J. M. Smucker Company One Strawberry Lane Orrville, OH 44667 Facsimile No. (###) ###-#### Attention: *****

JMS Foodservice, LLC c/o The J. M. Smucker Company One Strawberry Lane Orrville, OH 44667 Facsimile No. (###) ###-#### Attention: General Counsel

with a copy (which shall not constitute notice) sent concurrently to:

Calfee, Halter & Griswold LLP 800 Superior Avenue, Suite 1400 Cleveland, OH 44114 Facsimile No.: (###) ###-#### Attention: *****

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provided, however, that if any Party shall have designated a different address by notice to the others, then to the last address so designated.

Section 12.4 No Third Party Beneficiaries. This Agreement is solely for the benefit of the Parties hereto and no provision of this Agreement shall be deemed to confer upon any Person, other than the Parties and the Indemnified Parties, any rights or remedies hereunder or thereunder.

Section 12.5 Authority to Bind. No Party shall have the authority to commit any other Party to any binding obligation or to execute, on behalf of any other Party, any agreement, lease or other document creating legal obligations on the part of any other Party, and no Party shall represent to any third party that it has such authority.

Section 12.6 Amendment; Entire Agreement. This Agreement may not be amended, supplemented or otherwise modified except by an instrument in writing signed by both Parties hereto. This Agreement, the Asset Purchase Agreement and the other documents executed and delivered by the Parties pursuant to the Asset Purchase Agreement contain the entire agreement of the Parties hereto with respect to the subject matter hereof and thereof, superseding all negotiations, prior discussions and preliminary agreements made prior to the Effective Date with respect hereto and thereto.

Section 12.7 Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other Governmental Entity to be invalid, void, unenforceable or against its regulatory policy such determination shall not affect the enforceability or validity of any other provisions or of the remainder of this Agreement.

Section 12.8 Assignment and Transfer. (a) Except as to Licensor with respect to a Spin-Off as set forth in Section 13.01 of the Asset Purchase Agreement, and

subject to the termination rights upon a Change of Control as set forth in Section 8.3, neither Party may assign this Agreement or its rights or delegate any of its obligations under this Agreement, without the prior written consent of the other Party, which approval shall not be unreasonably withheld, conditioned or delayed; provided, however, that either Party may assign this Agreement or its rights or delegate any of its obligations under this Agreement to an Affiliate. Any permitted assignee shall assume all obligations of its assignor under this Agreement. Any attempt to assign any rights or delegate any obligations under this Agreement in contravention of this Section 12.8 shall be null and void.

(b) Except as otherwise provided herein, this Agreement shall be binding upon and inure to the benefit of the Parties hereto and their successors and permitted assigns.

Section 12.9 Counterparts. This Agreement may be executed in counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each of the Parties and delivered to the other Parties. This Agreement may be executed and delivered by facsimile transmission or electronic transmission (e.g., pdf file), and a facsimile or electronic transmission of this Agreement or of a signature of a Party will be effective as an original.

Section 12.10 Further Actions. Each Party will duly execute and deliver, or cause to be duly executed and delivered, such further instruments and do and cause to be done such further acts and things, as may be reasonably necessary or as the other Party may reasonably request in connection with this Agreement in order to carry out more effectively the provisions and purposes hereof.

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Section 12.11 Force Majeure. No Party shall be liable for any failure or delay in performing any of its obligations under this Agreement other than the obligation to make payments when due if the failure or delay is due to any cause beyond such Party’s reasonable control (including war, acts of terrorism, conditions or events of nature, civil disturbances, work stoppage, labor disturbance, power failures, failure of telephone lines and equipment, fire and earthquake, or any Applicable Laws) (any such cause, a “Force Majeure Event”), provided that such non-performing Party shall notify the other affected Party or Parties in writing of such Force Majeure Event (and the reasonable details thereof) as soon as possible after becoming aware of the Force Majeure Event, and shall use commercially reasonable efforts to perform its obligations under this Agreement notwithstanding such Force Majeure Event and mitigate the effect of any Force Majeure Event on the performance of its obligations under this Agreement.

Section 12.12 Survival. The provisions of Section 2.7, Articles 7, 10, 11, and 12, and other provisions that by their nature survive (including without limitation all obligations and rights that expressly survive termination of any of the licenses granted herein (for the indicated length of such express survival)) shall survive the expiration or termination of this Agreement for whatever reason.

[Remainder of Page Left Intentionally Blank - Signatures Appear on Following Page]

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IN WITNESS WHEREOF, the Parties hereto have caused their duly authorized representatives to execute and deliver this Agreement as of the Effective Date.

[Signature Page to License and Services Agreement]

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LICENSOR:

SARA LEE/DE B.V.

By: /s/ *****Name: *****Title: Authorized Signatory

LICENSEE:

JMS FOODSERVICE, LLC

By: /s/ *****Name: *****Title: President

EXHIBIT A

*****

EXHIBIT B

*****

EXHIBIT C

*****

EXHIBIT D

*****

Exhibit 8.1

Subsidiaries of D.E MASTER BLENDERS

LEGAL ENTITIES The following table provides an overview of the Group’s principal operating subsidiaries, all of which are 100% owned by the

Group. In addition, the Group has a 45% non-controlling interest in Kaffehuset Friele A/S, which is treated as an associate. Name of Subsidiary Country of Incorporation

D.E Coffee & Tea Australia Pty Ltd. AustraliaSara Lee Australia & NZ Pty Ltd. AustraliaSara Lee Food & Beverage (Australia) Pty Ltd. AustraliaSara Lee Foodservice (Australia) Pty. Ltd. AustraliaSara Lee Holdings (Australia) Pty Ltd. AustraliaSara Lee Household and Body Care (Australia) Pty Ltd. AustraliaSL/DE Australia Pty Ltd. AustraliaSL/DE Holdings (Australia) Pty. Ltd. AustraliaSL Sub Pty. Ltd. AustraliaSara Lee Household and Body Care Österreich GmbH AustriaDE Investments Belgium BVBA BelgiumDouwe Egberts Coffee Systems BVBA BelgiumDouwe Egberts Operating Service BVBA BelgiumSara Lee Coffee & Tea Belgium BVBA BelgiumSara Lee Finance Belgium BVBA BelgiumSara Lee/DE Immo Belgium BVBA BelgiumSara Lee Household and Body Care Belgium BVBA BelgiumSara Lee Cafés do Brasil Ltda BrazilExpresso Coffee—Automação de Bebidas Quentes Ltda. BrazilNutri-Metrics International (Guangzhou) Ltd. (70%) ChinaSara Lee (China) Trading Co. Ltd. ChinaCaitlin Financial Corporation N.V. CuracaoCodef Financial Services C.V. CuracaoSara Lee/DE Antilles N.V. CuracaoSara Lee/DE Finance (Antilles) N.V. CuracaoSara Lee/DE Investments (Antilles) N.V. CuracaoSara Lee/DE Investments (Cyprus) Ltd. CyprusSara Lee Czech Republic, s.r.o. Czech RepublicMerrild Kaffe A.p.S. DenmarkSara Lee/DE Nordic Finance K/S DenmarkCT Diffusion SAS FranceCourtaulds Textiles Holding SAS FranceDE France Finance SNC FranceDE France Holding SNC FranceMaison du Café Coffee Systems France SNC FranceMaison du Café France SNC FranceSara Lee France Finance SAS FranceSara Lee France SNC FranceSara Lee/DE France S.A.S. FranceCoffenco International GmbH GermanySara Lee Coffee & Tea Germany GmbH GermanySara Lee Deutschland GmbH GermanySara Lee/DE Holding GmbH GermanySara Lee Coffee and Tea Hellas SA GreeceSara Lee Hellas Holdings EPE GreeceNutri-Metrics International (Hong Kong) Ltd. Hong KongSara Lee Hong Kong Ltd. Hong KongSara Lee Hungary Zrt. Hungary

Name of Subsidiary Country of Incorporation

PT Premier Ventures Indonesia IndonesiaPT Sara Lee Indonesia IndonesiaPT Sara Lee Trading Indonesia IndonesiaPT Suria Yozani Indonesia IndonesiaSara Lee Holdings Italy S.r.l. ItalySara Lee Household and Body Care Italy SpA ItalySara Lee Japan Ltd. JapanSara Lee Baltic, s.i.a. LatviaSara Lee Finance Luxembourg S.á.r.l. LuxembourgSara Lee Holdings Luxembourg S.á.r.l. LuxembourgSara Lee Malaysia Sdn Bhd MalaysiaSara Lee South East Asia Sdn Bhd MalaysiaSara Lee Mauritius Holding Private Ltd. MauritiusBaro Bestuursmaatschappij B.V. NetherlandsThe Coffee Company B.V. NetherlandsCoffeeCompany Holding B.V. NetherlandsDefacto B.V. NetherlandsDE Export B.V. NetherlandsD.E MASTER BLENDERS 1753 N.V. NetherlandsDEMB International B.V. NetherlandsDouwe Egberts Coffee Systems Global Network B.V. NetherlandsDouwe Egberts Coffee Systems International B.V. NetherlandsDouwe Egberts Coffee Systems Nederland B.V. NetherlandsDouwe Egberts Coffee Treatment & Supply B.V. NetherlandsDouwe Egberts Finance B.V. NetherlandsDouwe Egberts Nederland B.V. NetherlandsI. Tas Ezn. B.V. NetherlandsKoninklijke Douwe Egberts B.V. NetherlandsMarander Assurantie Compagnie B.V. NetherlandsSara Lee International B.V. NetherlandsSara Lee International Holdings B.V. NetherlandsSara Lee/DE Global Finance B.V. NetherlandsSara Lee/DE Investments B.V. NetherlandsDEMB Holding B.V. NetherlandsD.E Coffee & Tea New Zealand Ltd. New ZealandKiwi (Nigeria) Limited NigeriaPrima-Sara Lee Coffee and Tea Poland Sp .z.o.o. PolandDouwe Egberts (Portugal) Produtos Alimentares Lda PortugalSara Lee Rus LLC Russian FederationSara Lee Singapore Pte Ltd. SingaporeSara Lee Slovakia, s.r.o. SlovakiaSara Lee Finance Spain S.L. SpainSara Lee Household and Body Care España S.L. SpainSara Lee Southern Europe, S.L. SpainMerrild Coffee Systems AB SwedenDecotrade GmbH SwitzerlandSara Lee (Thailand) Limited ThailandSara Lee Coffee & Tea (Thailand) Limited ThailandCourtaulds Textiles (Holdings) Limited United KingdomCourtaulds Textiles Limited United KingdomDouwe Egberts Coffee Systems Limited United KingdomImport Foods Sara Lee Limited United KingdomKiwi (EA) Limited United KingdomLinnyshaw Insurance Limited United KingdomMaster Models Limited United KingdomNew Way Packaged Products Limited United KingdomSara Lee Acquisition Limited United Kingdom

Name of Subsidiary Country of Incorporation

Sara Lee Coffee & Tea UK Limited United KingdomSara Lee Household & Body Care UK Limited United KingdomSara Lee UK Finance Limited United KingdomSara Lee UK Holdings Limited United KingdomSara Lee UK Pension Trustee Limited United KingdomSara Lee/DE Holdings Limited United KingdomSara Lee Investments Unlimited United KingdomTemana International Limited United KingdomDE US Inc United StatesTea Forté Inc United States

Exhibit 12.1

CERTIFICATION PURSUANT TO RULE 13A-14 OR 15D-14 OF THE SECURITIES EXCHANGE ACT OF 1934

I, Michiel J. Herkemij, certify that

Date: October 11, 2012

1) I have reviewed this annual report on Form 20-F of D.E MASTER BLENDERS 1753 N.V.;

2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;

4) The company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the company and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under

our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our

conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

c) Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the

period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and

5) The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting

which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the

company’s internal control over financial reporting.

/s/ Michiel J. Herkemij Michiel J. HerkemijChief Executive Officer

Exhibit 12.2

CERTIFICATION PURSUANT TO RULE 13A-14 OR 15D-14 OF THE SECURITIES EXCHANGE ACT OF 1934

I, Michel M. G. Cup, certify that

Date: October 11, 2012

1) I have reviewed this annual report on Form 20-F of D.E MASTER BLENDERS 1753 N.V.;

2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;

4) The company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the company and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under

our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our

conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

c) Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the

period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and

5) The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting

which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the

company’s internal control over financial reporting.

/s/ Michel M. G. Cup Michel M. G. CupChief Financial Officer

Exhibit 13.1

CERTIFICATION

In connection with this Annual Report on Form 20-F of D.E MASTER BLENDERS N.V. (the “Company”) for the period ended June 30, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Michiel Herkemij, the Chief Executive Officer of the Company and Michel Cup, the Chief Financial Officer of the Company, each hereby certifies, pursuant to 18 U.S.C. section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge:

Date: October 11, 2012

A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to D.E MASTER BLENDERS 1753 N.V. and will be retained by D.E MASTER BLENDERS 1753 N.V. and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certification is being furnished solely pursuant to 18 U.S.C. section 1350 and is not being filed as part of the Report or as a separate disclosure document.

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly represents, in all material respects, the financial condition and result of the operations of the Company.

/s/ Michiel J. Herkemij Michiel J. HerkemijChief Executive Officer

/s/ Michel M. G. Cup Michel M. G. CupChief Financial Officer