S Notes to the Consolidated Financial Statements (continued) 6.5 Share-based payments O Q, Heineken N.V. Annual Report 2018 Report of the Executive Board Report of the Supervisory Board Financial Statements Sustainability Review Other Information In millions of Note 2018 2017 Wages and salaries 2,444 2,339 Compulsory social security contributions 386 364 Contributions to defined contribution plans 51 47 Expenses/(income) related to defined benefit plans 9.1 105 59 Expenses related to other long-term employee benefits (9) 3 Equity-settled share-based payment plan 6.5 48 55 Other personnel expenses 724 683 3,749 3,550 Accounting policies Personnel expenses are recognised when the related service is provided, for more details on accounting policies related to post-retirements obligations and share-based payments refer to note 9.1 and 6.5 respectively. HEINEKEN has the following share-based compensation plans: Long-term incentive plan, Matching share plan (as part of the Short term incentive plan) and Extraordinary share plan. Long term incentive plan (LTIP) HEINEKEN has a performance-based Long-term incentive plan (LTIP) for the Executive Board and senior management. Under this LTIP, share rights are conditionally awarded to participants on an annual basis. The vesting of these rights is subject to the performance of Heineken N.V. on specific internal performance conditions and continued service over a three calendar year period by the employee. The performance conditions for LTIP are Organic Net Revenue growth, Organic EBIT beia growth, Earnings Per Share beia growth and Free Operating Cash Flow for LTIP 2016-2018. As per LTIP 2017-2019 Organic EBIT beia growth changed into Organic Operating Profit beia growth. At target performance, 100% of the awarded share rights vest. At threshold performance, 50% of the awarded share rights vest and 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. As from LTIP 2017-2019 the maximum performance is set at 200% for all senior managers. The grant date, fair market value (FMV) at grant date, service period and vesting date for the aforementioned plans are visualised below: Overview LTIP LTI Plan 31-12-2015 31-12-2016 31-12-2017 31-12-2018 31-12-2019 31-12-2020 2016-2018 grant date FMV €75.20 performance period vesting date 2017-2019 grant date FMV €66.88 performance period vesting date 2018-2020 grant date FMV €82.46 performance period vesting date Total LTIP expenses recognised in 2018

Jaarverslagen en Personeelsbladen Heineken

Jaarverslagen | 2018 | | pagina 77