DHL 2005 Annual Report Download - page 23
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Please find page 23 of the 2005 DHL annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Stock Option Plan 2003
e SOP 2003 authorized the Board of Management and Supervisory Board to issue up to
60 million options by July 31, 2005. Options were issued in three annual tranches, the rst
in August 2003 and the most recent in July 2005. e group of beneciaries comprised the
members of the company’s Board of Management (group 1), members of the executive
boards and members of the executive management of subsidiaries in Germany and abroad
if, according to the company’s guidelines, they belong to Group management levels 2 or
3 (group 2), and other senior executives (who are salaried employees) if, according to the
company’s guidelines, they belong to Group management levels 2, 3 or 4 (group 3). Senior
executives at Group management levels 1 and 2 were only eligible to receive options if they
had invested a certain amount in the company’s shares and had deposited these shares.
For those wishing to exercise options, the following main points apply:
• ere is a lock-up period of three years from when the options were issued. e options
must then be exercised within a two-year period.
• Each option entitles the holder to either purchase one share in the company at the issue
price or receive a cash settlement in the amount of the dierence between the issue price
and the average price of the stock during the last ve trading days prior to the exercise
date, at the company’s discretion. e issue price is the arithmetic mean of the closing
price of the stock on the last twenty trading days before the options were granted.
• For every six options issued, a maximum of four may be exercised if an absolute per-
formance target is satised, and a maximum of two if a relative performance target is
satised.
Absolute performance target: this target is satised if the average closing share price for
the last 60 trading days prior to expiration of the lock-up period (the nal price) exceeds
the relevant issue price by a dened percentage. If the nal price is at least 10% higher
than the issue price, one of every six options granted may be exercised; if the nal price is
at least 15% higher than the issue price, two out of six may be exercised; if the nal price
is at least 20% higher than the issue price, three may be exercised; and if the nal price is
at least 25% higher than the issue price, four out of every six stock options granted may
be exercised.
Relative performance target: two of every six options granted can only be exercised based
on how well the stock has performed relative to the Dow Jones EURO STOXX Total Re-
turn Index (benchmark index). If the percentage change between the relevant issue price
and the average closing price of the stock for the last 60 trading days prior to expiration
of the lock-up period is at least equal to the percentage change in the benchmark index
between the average value for the last 60 trading days prior to expiration of the lock-up
period and the average index value for the relevant reference period (i.e. company stock
is performing in line with the benchmark), then one out of every six options may be ex-
ercised. If, according to the above calculation, the stock has increased in value during this
period by at least 10% more than the benchmark index, thereby outperforming the bench-
mark index by at least 10%, then two out of every six options granted may be exercised.
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