Mercedes 2013 Annual Report Download - page 223

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F | Consolidated Financial Statements | Notes to the Consolidated Financial Statements
The number of phantom shares that vest will be based
on the return on net assets, derived from internal targets,
and return on sales, compared with benchmarks oriented
towards competitors.
The Group recognizes a provision for awarding the PPSP in
the consolidated statement of financial position. Since payment
per vested phantom share depends on the quoted price of
one Daimler ordinary share, the quoted price almost completely
represents the fair value of each phantom share. The pro-
portionate remuneration expenses for the individual years are
determined on the basis of the year-end quoted price of
Daimler ordinary shares and the estimated target achievement.
Stock Option Plans. In April 2000, Shareholders’ Meeting
approved the Daimler Stock Option Plan (SOP), which grants
stock options for the purchase of Daimler ordinary shares
to eligible employees. Options granted under the SOP are
exercisable at a reference price per Daimler ordinary share,
which is determined in advance, plus a 20% premium. The
options become exercisable in equal installments at the earliest
on the second and third anniversaries of the date of grant.
All unexercised options expire ten years after the date of grant.
If the market price per Daimler ordinary share on the date
of exercise is at least 20% higher than the reference price, the
holder is entitled to receive a cash payment equal to the
original exercise premium of 20%. No new stock options were
granted after 2004.
In the event of exercise, the Group has generally issued
ordinary shares so far.
Table  F.52 shows the basic terms of the SOP.
Options granted to the Board of Management in 2004
for which – according to the recommendations of the German
Corporate Governance Code – the Presidential Committee
can impose a limit or reserve the right to impose a limit in the
event of exceptional and unpredictable developments were
measured at their intrinsic values as of December 31. In 2013,
the remaining options from previous year were exercised
completely.
Table  F.53 shows an analysis of the stock options issued.
The weighted average share price of Daimler ordinary
shares during the exercise period was €48.83 (2012: €38.27).
As of December 31, 2013, the weighted average remaining
contractual life of outstanding stock options was 0.25 years
(2012: 1.11 years).
Basic terms of the SOP
Options
outstanding
in millions
Options
exercisable
in millions
Reference
price
euros per share
Exercise
price
euros per share
Options
granted
in millions At December 31, 2013
Year of grant
2004 36.31 43.57 18.0 0.2 0.2
F.52
Analysis of the stock options issued
Number of
stock options
in millions
2013
Average
exercise price
euros per share
Number of
stock options
in millions
2012
Average
exercise price
euros per share
Balance at the beginning of the year 2.7 42.24 5.5 42.80
Exercised -2.2 42.62 -1.2 34.62
Disposals/Forfeited -0.3 37.33 -1.6 49.88
Outstanding at year-end 0.2 43.57 2.7 42.24
Exercisable at year-end 0.2 43.57 2.7 42.24
F.53