Praktiker Bau- und Heimwerkmärkte Holding AG, Kirkel

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Any costs incurred in connection with the issue were also capitalized. They are to be distributed in a
straight-line manner over the entire term to maturity and reported with the corresponding impact on
income.
Share-linked remuneration
In the previous year, a share bonus programme designed to run for five years was introduced, starting
in August 2006. The programme concerned comprises five tranches that are awarded annually,
whereby the target parameters are worked out separately for each tranche. The last tranche is set to
be awarded in 2010. The target parameters are worked out four weeks after the annual general shareholders’
meeting held by Praktiker Bau- und Heimwerkermärkte Holding AG (cut-off date for the approval
of the share bonus).
Payment of the individual annual share bonuses automatically occurs in cash in the month following
the expiry of the three-year term of the given tranche, provided the conditions to which payment is
subject have been fulfilled. Payment of the 2006 tranche, for instance, will occur in 2009 and payment
of the final tranche from 2010 correspondingly in 2013.
Initially, the level of the bonus is determined on the basis of the ratio of the starting price to the target
share price. The starting price per tranche equates to the arithmetical average of the final prices of
Praktiker shares in the 20 last consecutive stock market trading days prior to the cut-off date (four
weeks after the given annual general shareholders’ meeting). The target share price per tranche, in
the case of the attainment of which the full bonus is awarded, is calculated on the basis of the starting
price, whereby a price rise of 15 percent is set over a period of three years.
The level of the bonus concerned also depends on the performance of Praktiker shares as compared
with that of the shares of other relevant trading companies listed on the stock exchange. For comparison
purposes, the MDAX and the Dow Jones Euro Stoxx “General Retailers” are used. They permit
the valuation of the price development in Praktiker shares on a national or Europe-wide basis. Should
the development in Praktiker shares with effect of the cut-off date not deviate by more than 10 percent
from the average value of both indices, the share bonus is paid out in full. In the event that the price
development in Praktiker shares exceeds the average value by more than 10 percent (outperformance),
the amount paid out as a share bonus is increased to a total of 120 percent. However, should
it fall short of the average value of the indices mentioned by more than 10 percent (underperformance),
the level of the share bonus is reduced to 80 percent.
The share bonus is only awarded if, at the point in time of it becoming due, the contract of employment
of the employee concerned at Praktiker Group has neither been terminated nor has a mutually agreed
cancellation of the contractual relationship occurred. Payment of share bonuses is limited in each case
to the level of the current, individually agreed basic annual salary (gross).