Remuneration (continued)
Pension and other contract terms
Future outlook
Ahold at a glance
Business review
Governance
Pension
The pension plan for Management Board members
is identical to that of all other Ahold associates in
the Netherlands and is referred to as a defined
benefit plan, based on career average salary (at
Ahold). From January 1, 2015 onwards, the normal
retirement age is 67 (previously 65). Under this plan,
each Management Board member pays a pension
premium contribution of approximately 4.2% (2014)
of his or her pension-bearing salary. The pension
accrual for future benefits has been lowered from
2.25% to 2% as of January 1, 2014; contributions
from participants will be gradually increased and the
income offset component will be gradually lowered.
The employer contribution and the conditional
additional funding rules remained the same.
As of January 1, 2015, the pensionable salary has
been capped at €96,500 and the income offset
component has been lowered again. For salaries
over €96,500, a new arrangement will be
implemented, which is currently under discussion.
Loans
Ahold does not provide loans or advances to
members of the Management Board or the
Supervisory Board. There are no loans or advances
outstanding. Ahold does not issue guarantees to the
benefit of members of the Management Board or
the Supervisory Board. There have been no such
guarantees issued.
Additional arrangements
In addition to the remuneration of the Management
Board members, a number of additional
arrangements apply. These include expense
allowances, medical insurance and accident
insurance, and are in line with standard practice in
the Netherlands.
Employment agreements
The term of appointment for all Management
Board members is four years, while the term of
employment is indefinite. If the Company terminates
the employment agreement of any member of the
Management Board, the severance payment is
limited to one year's base salary. The same applies if
an initial employment agreement for four years is not
continued because the Management Board member
is not reappointed. The employment agreements
may be terminated by Ahold with a notice period of
12 months and by the Management Board member
with a notice period of six months.
For 2015, no adjustments to the remuneration policy
are expected.
Vesting of shares under the GRO plan
On April 16, 2015, a maximum of 0.2 million
conditional shares granted in 2012 to members of the
Management Board under the mid-term component
of the GRO plan and 0.1 million performance shares
granted in 2010 to members of the Management
Board under the long-term component of the GRO
plan are expected to vest with continuing and retired
Board members who received the grants. Except to
finance tax due on the vesting date, members of the
Management Board cannot sell shares for a period
of at least five years following the grant date, or until
the end of their employment, if this period is shorter.
On February 27 2015, a maximum of 2.6 million
conditional shares granted in 2012 to Ahold
associates under the mid-term component of the
Global Reward Opportunity (GRO) equity-based
long-term incentive plan, 1.2 million performance
shares granted in 2010 to Ahold associates under
the long-term component of the GRO plan, and
40,000 matching shares granted in 2010 to Ahold
associates under the mid-term component of the
GRO plan are expected to vest. Vesting is subject
to the participant being employed by the Company
on the applicable vesting date. On the vesting date,
participants are allowed to sell all or part of the
shares vested.
The Company will use treasury shares for delivery of
the vested shares.
