123
Notes to the consolidated financial statements continued
32 Share-based compensation continued
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Share option plans
Ahold
Annual Report 2011
Groupata glance
Performance
Governance
Investors
Outstanding at the
beginning
of 2011
Granted1
Vested2
Forfeited
Outstanding at the
end
of 2011
Other employees
2006 grant
1,994,690
1,148,619
3,096,898
46,411
2007 grant
1,534,329
35,724
51,382
1,447,223
2008 grant
3,880,937
1,944,439
102,159
1,834,339
2009 grant
5,100,482
58,751
213,111
4,828,620
2010 grant
2,847,239
16,972
120,030
2,710,237
2011 grant
5,652,456
3,690
156,539
5,492,227
Subtotal CEB members
987,192
313,557
279,574
275,750
745,425
Total number of shares
16,344,869
7,114,632
5,436,048
965,382
17,058,071
1 Represents the number of shares originally granted for the 2011 grant. For the five-year 2006 grant the number of shares granted in 2011 represents the additional number of
shares granted based on the final TSR ranking and the matching shares related to the 2006 grant.
2 The vesting date of the five-year 2006 grant, the matching shares related to the 2006 grant and the three-year 2008 grant was March 4, 2011The Euronext closing share price
was €9.42 as of March 4, 2011
Valuation model and input variables
The weighted average fair value of the conditional shares granted in 2011, for all eligible participants including Corporate Executive Board
members, amounted to €8.60 and €7.06 per share for the three-year and five-year components, respectively (2010: €9.42 and €8.37,
respectively). The fair value of the three-year component is based on the share price on the grant date, reduced by the present value of
dividends expected to be paid during the vesting period. The fair value of the five-year component is determined using a Monte Carlo
simulation model. The most important assumptions used in the valuations of the three- and five-year components were as follows
(expressed as weighted averages):
Percent 2011 2010
Risk-free interest rate 2.4 1.9
Volatility 27.6 29.1
Assumed dividend yield 4.2 3.0
Expected volatility has been determined based on historical volatilities.
In 2005, Ahold had one global share option plan with a uniform set of rules and conditions for all participants, except members of the
Corporate Executive Board, to whom a separate plan applied. The term of the 2005 share options for all participants except Corporate
Executive Board members is eight years and the exercise of these options is conditional upon continued employment during a three-year
vesting period. Upon termination of employment, share options that have vested can be exercised during the four weeks following
termination and are forfeited thereafter. The share option grant made in 2005 to members of the Corporate Executive Board had a five-
and a ten-year term and was subject to a performance criterion at vesting: the average economic value-added improvement versus
targeted improvement over the three financial years prior to vesting. In 2008, the final vesting percentage was set at 96 percent.
Until January 2, 2005, Ahold had three share option plans (the Dutch, U.S., and International Share Option Plans - collectively the
"Plans"). Under these Plans, participants were granted share options with either a five- or ten-year term. In addition, a limited number of
share options were granted in 2006 under the 2005 global share option plan rules with a five- or ten-year term. After the introduction of
GRO, options were discontinued as a remuneration component. All options vested by the end of 2009.
