Each SAR entitles the holder to receive a cash settlement equal to the difference between the average closing price of Deutsche Post shares for the five trading days preceding the exercise date and the exercise price of the SAR. In 2009, the members of the Board of Management each invested 10% of their annual target salary per tranche in Deutsche Post shares. When the stock appreciation rights were granted as part of the allocation procedure in 2009, the lock-up period was increased from three to four years. After expiration of the lock-up period, the stock appreciation rights can be exercised wholly or partially for a period of two years, provided an absolute or relative performance target has been achieved. Any stock appreciation rights not exercised during this two-year period will lapse.

To determine how many – if any – of the stock appreciation rights granted can be exercised, the average share price or the average index value is compared for the reference period and for the performance period. The reference period comprises the last 20 consecutive trading days prior to the issue date. The performance period is the last 60 trading days prior to the end of the lock-up period. The average share price (closing price) is calculated as the average closing price of Deutsche Post shares in Deutsche Börse AG’s Xetra electronic trading system.

A maximum of four out of every six stock appreciation rights can be “earned” via the absolute performance target and a maximum of two via the relative performance target. If neither an absolute nor a relative performance target is met by the end of the lock-up period, the stock appreciation rights of the related tranche will lapse and no replacement or compensation of any kind will be provided.

One SAR is earned each time the closing price of Deutsche Post shares exceeds the issue price by at least 10%, 15%, 20% or 25%. The relative performance target is tied to the performance of the shares in relation to the performance of the Dow Jones STOXX 600 Index (SXXP; ISIN EU0009658202). The target is met if the share price is not outperformed by the index during the performance period or if it outperforms the index by at least 10%.

The Long-Term Incentive Plan is being continued in contracts entered into after 5 August 2009 and in contract renewals, although the amount to be invested by individual Board members is now 10% of their annual base salary. Remuneration from stock appreciation rights is limited to 300% of the targeted cash remuneration (annual base salary plus the targeted annual performance-related remuneration).