Remuneration continued
Treatment of outstanding
performance shares
2016 Long-term equity-based
program: GRO
”94% 94%
Overview
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Financials
Investors
Ahold Delhaize Annual Report 2016
At-target grant and maximum vesting performance shares
All percentages constitute a percentage of base salary
2016 GRO share grant calculation - Example CEO
Table assumes base salary of €1,017,020 and six-month average share price preceding the regular annual award date of €19.63
2016 GRO share grant calculation - Example CFO
Table assumes base salary of €678,013 and six-month average share price preceding the regular annual award date of €19.63
The vesting of the GRO performance shares
is subject to performance over a period of
three years and the GRO program employs
two financial measures: Return on Capital
(40%) and Total Shareholder Return (40%).
In addition, a non-financial performance
measure (20%) is included related to
responsible retailing sustainability targets.
For this purpose, performance is measured
on the basis of both an external and internal
target. The Dow Jones Sustainability Index (the
external target) measures how the Company
performs on sustainability against peers in
the sector. Healthy sales (the internal target)
is the measure we use to drive performance
against our company objective of facilitating
healthier eating.
2016 GRO grant
To calculate the number of shares to be granted, the at-target value of the award is divided by
the average share price over the six-month period preceding the regular annual award date.
Scenario analyses are prepared regularly to estimate the possible future payout levels.
The outstanding performance shares awarded
under the Ahold GRO program (for former
Ahold management board members) and the
Delhaize European long-term incentive plan (for
former Delhaize management board members)
have been rolled over into Ahold Delhaize’s
GRO program.
As a consequence of the merger, the
outstanding (non-vested) performance share
awards remaining from the Ahold GRO plan
have been split into two parts. One part,
which is related to the full performance years
prior to the year of the merger (2012, 2013,
2014 and 2015, where applicable), has been
assessed against the performance of Ahold,
as a stand-alone company on the basis of the
existing performance measures. Based on
the performance realized in those years this
portion of the award has been assessed and
transformed into restricted Ahold Delhaize
shares. These restricted shares are not subject
to additional performance criteria, but will be
subject to the remaining vesting period and
continued employment. The other portion,
which is related to the performance during the
year of the merger and beyond (2016 and 2017),
will be assessed against the financial measures
of Ahold Delhaize’s long-term equity-based
plan. The outstanding conditional shares will
continue to be subject to the remaining vesting
period and continued employment.
Outstanding (non-vested) performance
shares awarded under the Delhaize European
long-term incentive plan have similarly been
converted into Ahold Delhaize restricted shares
and shares subject to meeting the performance
measures of the Ahold Delhaize GRO plan.
The Management Board members participate
in Ahold Delhaize’s long-term equity-based
incentive program, GRO. The 2016 GRO award
was made in the open period following the
merger. This grant date was a one-time
exception to the consistent grant policy in
order to ensure a grant could be made to all
members of the Management Board on the
same date in 2016. This 2016 award will vest on
the regular vesting date in 2019: the day after
the annual General Meeting of Shareholders.
Future GRO awards will continue to be made
on the regular annual award date, which is
also the day after the annual General Meeting
of Shareholders.
RoC performance shares
TSR performance shares
Sustainability performance shares
RoC performance shares
TSR performance shares
Sustainability performance shares
237.305
1.186.523
At - target
share grant
of base salary)
70%
70%
35%
175%
12.084
60.420
CEO
Deputy CEO
CFO
COO US
COO EU
At - target
share grant
of base salary)
94%
94%
47%
235%
Award value
(base salary
at-target grant
474.609
474.609
Total at-target
grant
235%
200%
175%
200%
150%
Number of shares
granted (award
value divided by
six-month average
share price)
24.168
24.168
Total maximum
vesting
376g"
320%
280%
320%
240%
Number of shares
granted (award
value divided by
six-month average
share price)
48.680
48.680
24.340
121.700
Performance shares
RoC TSR
(40%) (40%)
80% 80%
70% 70%
80% 80%
60% 60%
Award value
(base salary
at-target grant
955.999
955.999
477.999
2.389.997
Sustainability
(20%)
47%
40%
35%
40%
30%
