108 Notes to the Consolidated Financial Statements (continued) 27. Share-based payments - Long-Term Variable Award - - Heineken NV. Report of the Report of the Financial Sustainability Other Annual Report 2016 Introduction Executive Board Supervisory Board Statements Review Information HEINEKEN has a performance-based share plan (Long-Term Variable award (LTV)) for the Executive Board and senior management. Under this LTV plan, share rights are conditionally awarded to incumbents on an annual basis. The vesting of these rights is subject to the performance of Heineken NV on specific internal performance conditions and continued service over a three-year period. The performance conditions for LTV 2014-2016, LTV 2015-2017 and LTV 2016-2018 are the same for the Executive Board and senior management and comprise solely of internal financial measures, being Organic Revenue Growth, Organic EBIT beia growth, Earnings Per Share (EPS) beia growth and Free Operating Cash Flow. At target performance, 100% of the awarded share rights vest. At threshold performance, 50% of the awarded share rights vest. At maximum performance, 200% of the awarded share rights vest for the Executive Board as well as senior managers contracted by the US, Mexico, Brazil and Singapore, and 175% vest for all other senior managers. The performance period for the aforementioned plans are: LTV Performance period start Performance period end 2014-2016 1 January 2014 31 December 2016 2015-2017 1 January 2015 31 December 2017 2016-2018 1 January 2016 31 December 2018 The vesting date for the Executive Board is shortly after the publication of the annual results of 2016, 2017 and 2018 respectively and for senior management on 1 April 2017, 2018 and 2019 respectively. As HEINEKEN will withhold the tax related to vesting on behalf of the individual employees, the number of Heineken NV shares to be received will be a net number. The share rights are not dividend-bearing during the performance period. The fair value has been adjusted for expected dividends by applying a discount based on the dividend policy and historical dividend payouts, during the vesting period. The terms and conditions of the share rights granted are as follows: Based on share Grant date/employees entitled Number* price Share rights granted to Executive Board in 2014 51,702 49.08 Share rights granted to senior management in 2014 597,744 49.08 Share rights granted to Executive Board in 2015 54,903 58.95 Share rights granted to senior management in 2015 534,298 58.95 Share rights granted to Executive Board in 2016 34,278 78.77 Share rights granted to senior management in 2016 398,850 78.77 The number of shares is based on at target payout performance (100%). Under the LTV 2013-2015, a total of 58,447 (gross) shares vested for the Executive Board and 726,789 (gross) shares vested for senior management. The number of shares vested for the Executive Board relates to Mr. Jean-Frangois van Boxmeer, as Mr. René Hooft Graafland was no longer member of the Executive Board at vesting and Ms. Laurence Debroux received LTI as per LTIP 2015-2017. Based on the performance conditions, it is expected that approximately 786,093 shares of the LTV 2014-2016 will vest in 2017 for senior management and the Executive Board. The number, as corrected for the expected performance for the various awards, and weighted average share price per share under the LTV of senior management and Executive Board are as follows: Weighted average share price 2016 Number of share rights 2016 Weighted average share price 2015 Number of share rights 2015 Outstanding as at 1 January 52.26 1,854,782 44.42 2,401,418 Granted during the year 78.77 433,128 58.95 589,201 Forfeited during the year 58.33 (121,026) 50.95 (235,289) Vested during the year 50.47 (785,236) 35.89 (891,409) Performance adjustment 491,699 (9,139) Outstanding as at 31 December 60.40 1,873,347 52.26 1,854,782

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Jaarverslagen | 2016 | | pagina 109