20 Equity attributable to common shareholders continued
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Ahold
Annual Report 2010 v5^5
Group at a glance
Performance
Governance
Financials
Notes to the consolidated financial statements continued
Investors
Common shares and additional paid-in capital
Changes in the number of common shares and the number of treasury shares were as follows:
Number of common
Number of
Number of
shares issued and
treasury shares
common shares
fully paid (x 1,000)
(x 1,000)
outstanding (x 1,000)
Balance as of December 28, 2008
1,191,888
15,203
1,176,685
Share-based payments
(4,529)
4,529
Balance as of January 3, 2010
1,191,888
10,674
1,181,214
Share buyback
38,718
(38,718)
Share-based payments
(2,649)
2,649
Balance as of January 2, 2011
1,191,888
46,743
1,145,145
Dividends on common shares
On April 13, 2010, the General Meeting of Shareholders approved the dividend over 2009 of €0.23 per common share (€272 million in the
aggregate). The dividend was paid on May 4, 2010. The Corporate Executive Board, with the approval of the Supervisory Board,
proposes that a dividend of €0.29 per common share be paid in 2011 with respect to 2010. Based on the number of outstanding common
shares as of March 2, 2011, the dividend would amount to approximately €329 million in the aggregate. This dividend is subject to
approval by the General Meeting of Shareholders and has not been included as a liability on the consolidated balance sheet as of January
2, 2011. The payment of this dividend will not have income tax consequences for the Company.
Share buyback
On March 4, 2010, Ahold announced its decision to return €500 million to its shareholders by way of a share buyback program, to be
completed over a 12-month period. Under this program, 38,717,603 of the Company's own common shares were repurchased and
delivered in 2010. Shares were repurchased at an average price of €9.96 per share for a total amount of €386 million.
Cumulative preferred shares
The Company's Articles of Association provide for the possible issuance of cumulative preferred shares. The Company believes that its
ability to issue this class of shares could prevent, or at least delay, an attempt by a potential bidder to make a hostile takeover bid. In this
respect, but also in other circumstances, this ability may safeguard the interests of the Company and all stakeholders in the Company and
resist influences that might conflict with those interests by affecting the Company's continuity, independence, or identity. No cumulative
preferred shares were outstanding as of January 2, 2011 or during 2010 and 2009.
In March 1989, the Company entered into an agreement with Stichting Ahold Continuïteit (SAC) as amended and restated in April 1994,
March 1997, December 2001 and December 2003 (the Option Agreement). Pursuant to the Option Agreement, SAC was granted an
option, without payment, to acquire from the Company, from time to time until December 2016, cumulative preferred shares up to a total
par value that is equal to the total par value of all issued and outstanding shares of Ahold's share capital, excluding cumulative preferred
shares, at the time of exercising the option. The Option Agreement provides for an increase of the total par value of cumulative preferred
shares under option, taking into account the new, increased authorized share capital. The holders of the cumulative preferred shares are
entitled to 1,666.67 votes per share and a cumulative dividend expressed as a percentage of the amount called-up and paid-in to
purchase the cumulative preferred shares. The percentage to be applied is the sum of (1) the average basic refinancing transaction
interest rate as set by the European Central Bank - measured by the number of days during which that rate was in force in the fiscal year
over which the dividend is paid - plus 2.1 percent, and (2) the average interest surcharge rate - measured by the number of days during
which that rate was in force in the fiscal year over which the dividend is paid - that would be charged by the largest credit institution in the
Netherlands (based on balance sheet total as at the close of the fiscal year immediately preceding the fiscal year over which the dividend
is paid). The minimum percentage to be applied is 5.75 percent. Subject to limited exceptions, any potential transfer of cumulative
preferred shares requires the approval of the Corporate Executive Board. Cumulative preferred shares can only be issued in a registered
form. The Company may stipulate that only 25 percent of the par value will be paid upon subscription to cumulative preferred shares until
payment in full is later required by the Company. SAC would then only be entitled to a market-based interest return on its investment.
SAC is a foundation organized under the laws of the Netherlands. Its statutory purpose is to safeguard the interests of the Company and
all stakeholders in the Company and to resist, to the best of its ability, influences that might conflict with those interests by affecting the
Company's continuity, independence, or identity. In the case of liquidation, the SAC board of directors will decide on the use of any
remaining residual assets. The SAC board of directors has four members. The members are appointed by the board of SAC itself.
