content_image/108395.jpg content_image/108400.jpg
## 20. Equity Participation Plans/Management Incentive Program 

In 1996 PUMA introduced long-term incentive plans with the aim of retaining management staff in the company over the longer term. Convertible bonds, stock option programs (SOP) and stock 

## Convertible Bonds 

Convertible bonds were issued to management from 1996 to 1999. At the balance sheet date, bonds from the 1999/2009 tranches which are held by management only were still open for conversion. The Board does not hold any convertible bonds. Each € 2.56 (originally DM 5.00) entitles to conversion into one of the company’s shares. When exercising a conversion right, a cash 

Development in 2004: 

appropriation rights (SAR) were implemented as long-term incentives: 

payment for the acquisition of one share is to be made to the amount by which the conversion price exceeds the nominal amount of the convertible bond. The term of the convertible bonds is ten years; they may be converted following a blocking period of two years as from the date of issue. 

<img src='content_image/108395.jpg'>

## SOP 

A Stock Option Program was introduced within the scope of the conditional capital created in 2001. The conditional capital increase is used to service the option rights of members of the PUMA AG Management Board, members of the executive bodies of affiliated companies, the executive staff of PUMA AG and affiliated companies. Entitled persons are given the opportunity to acquire PUMA shares at the exercise price within a 5-year period and following a 2-year blocking period as from the date of issue. The exercise price is the average value of the closing price in XETRA trading during the last five trading days prior to the date of acquisition of the option rights or, if higher, the closing price on 

Development in 2004: 

the date of issue of the respective tranche, in addition to a 15% performance target. On the basis of the respective share price, each share acquisition leads to a value appreciation which results after deduction of the corresponding exercise price. From 2001 to 2004, option rights were issued to management in the respective tranches. The Board exercised a total of 130,500 options from Tranche II (2002/2007) during the financial year. Furthermore, as of the balance sheet date, the Board holds a total of 57,000 units from Tranche 2003/2008, and 137,700 options from Tranche 2004/2009. For more details, see Paragraph 31 of these Notes. 

<img src='content_image/108400.jpg'>

Foreword | Mission | Management Report | Share | Marketing | Consolidated Financial Statements - IFRS - | Report of Supervisory Board | Board of Management 

