##### Table of Contents



United States
 Securities and Exchange Commission
 Washington, D.C. 20549
  Form 20-F
 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
 OF THE SECURITIES EXCHANGE ACT OF 1934
 for the fiscal year ended December 31,
    2010
  Commission file number
    025566
  ASML HOLDING N.V.
   THE NETHERLANDS
   DE RUN 6501
 5504 DR VELDHOVEN
 THE NETHERLANDS
  Craig DeYoung
 Telephone: +1 480 383 4005
 Facsimile: +1 480 383 3978
 E-mail:
    craig.deyoung@asml.com
 8555 South River Parkway,
 Tempe, AZ 85284, USA
 E-mail,
  Title of each class

Name of each exchange on which registeredOrdinary Shares 
    (nominal value EUR 0.09 per share)

The NASDAQ Stock Market LLC          436,592,972 Ordinary Shares
 (nominal value EUR 0.09 per share)
  ü
   ü
    ü
  Regulation S-T
  ü
   ü
   ü
      Rule 12b-2
 ü
   Richard A. Ely
 Skadden, Arps, Slate, Meagher & Flom (UK) LLP
 40 Bank Street, Canary Wharf
 London E14 5DS England
  ASML ANNUAL REPORT 2010




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##### Table of Contents



Contents
    
 Part I1

Item 1
    Identity of Directors, Senior Management and
    Advisors1

Item 2 Offer
    Statistics and Expected Timetable1

Item 3 Key
    InformationA.

Selected Financial DataB.

Capitalization and IndebtednessC.

Reasons for the Offer and Use of ProceedsD.

Risk Factors9

Item 4
    Information on the CompanyA.

History and Development of the CompanyB.

Business OverviewC.

Organizational StructureD.

Property, Plant and Equipment17

Item 4A
    Unresolved Staff Comments17

Item 5
    Operating and Financial Review and ProspectsA.

Operating ResultsB.

Liquidity and Capital ResourcesC.

Research and Development, Patents and Licenses,
    etcD.

Trend InformationE.

Off-Balance Sheet ArrangementsF.

Tabular Disclosure of Contractual ObligationsG.

Safe Harbor39

Item 6 Directors,
    Senior Management and EmployeesA.

Directors and Senior ManagementB.

CompensationC.

Board PracticesD.

EmployeesE.

Share Ownership45

Item 7 Major
    Shareholders and Related Party TransactionsA.

Major ShareholdersB.

Related Party TransactionsC.

Interests of Experts & Counsel47

Item 8
    Financial InformationA.

Consolidated Statements and Other Financial
    InformationB.

Significant Changes  ASML ANNUAL REPORT 2010




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##### Table of Contents



47

Item 9 The
    Offer and ListingA.

Offer and Listing DetailsB.

Plan of DistributionC.

MarketsD.

Selling ShareholdersE.

DilutionF.

Expenses of the Issue49

Item 10
    Additional InformationA.

Share CapitalB.

Memorandum and Articles of AssociationC.

Material ContractsD.

Exchange ControlsE.

TaxationF.

Dividends and Paying AgentsG.

Statement by ExpertsH.

Documents on DisplayI.

Subsidiary Information54

Item 11
    Quantitative and Qualitative Disclosures About Market
    Risk57

Item 12
    Description of Securities Other Than Equity
    SecuritiesPart II58

Item 13
    Defaults, Dividend Arrearages and Delinquencies58

Item 14
    Material Modifications to the Rights of Security Holders and Use
    of Proceeds58

Item 15
    Controls and Procedures58

Item 16A.

Audit Committee Financial ExpertB.

Code of EthicsC.

Principal Accountant Fees and ServicesD.

Exemptions from the Listing Standards for Audit
    CommitteesE.

Purchases of Equity Securities by the Issuer and
    Affiliated PurchasersF.

Change in Registrants Certifying
    AccountantG.

Corporate GovernancePart III62

Item 17
    Financial Statements62

Item 18
    Financial Statements62

Item 19
    ExhibitsEX-8.1EX-12.1EX-13.1EX-15.1    ASML ANNUAL REPORT 2010




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ASML ANNUAL REPORT 2010




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Part I   Special Note
    Regarding Forward-Looking Statements
 Form 20-F and/or
   Form 20-F.
 Item 1
    Identity of Directors, Senior Management and Advisors    Item 2 Offer
    Statistics and Expected Timetable    Item 3 Key
    Information  A. Selected
    Financial Data   ASML ANNUAL REPORT 2010
 1




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##### Table of Contents



Five-Year
    Financial Summary
 Year ended December 31


20061



20071



2008



2009



2010(in thousands, except per share data)


EUR



EUR



EUR



EUR



EURConsolidated statements of operations dataNet sales


3,581,776



3,768,185



2,953,678



1,596,063



4,507,938Cost of sales


2,127,797



2,218,526



1,938,164



1,137,671



2,552,768Gross profit on sales


1,453,979



1,549,659



1,015,514



458,392



1,955,170Research and development costs


386,567



486,141



516,128



466,761



523,426Amortization of in-process research and development costs






23,148











Selling, general and administrative
    costs2


202,330



223,386



210,172



154,756



181,045Income (loss) from operations


865,082



816,984



289,214



(163,125
)


1,250,699Interest income (expense),
    net2


(3,323
)


31,169



20,430



(8,425
)


(8,176
)Income (loss) from operations before income taxes


861,759



848,153



309,644



(171,550
)


1,242,523(Provision for) benefit from income taxes


(243,211
)


(177,152
)


12,726



20,625



(220,703
)Net income (loss)


618,548



671,001



322,370



(150,925
)


1,021,820Earnings per share dataBasic net income (loss) per ordinary share


1.30



1.45



0.75



(0.35
)


2.35Diluted net income (loss) per ordinary
    share3


1.26



1.41



0.74



(0.35
)


2.33Number of ordinary shares used in 
    computing per share amounts (in thousands)Basic


474,860



462,406



431,620



432,615



435,146Diluted3


503,983



485,643



434,205



432,615



438,974   1
    As of January 1, 2008, ASML
    accounts for award credits offered to its customers as part of a
    volume purchase agreement using the deferred revenue model.
    Until December 31, 2007, ASML accounted for award credits
    using the cost accrual method. The comparative figures for 2006
    and 2007 have been adjusted to reflect this change in accounting
    policy.2
    As of January 1, 2010, ASML
    adopted Accounting Standards Codification (ASC) 810
    Amendments to FIN 46(R) which resulted in the
    consolidation of the Variable Interest Entity (VIE)
    that owns ASMLs headquarters in Veldhoven, the
    Netherlands. The comparative figures for 2006 through 2009 have
    been adjusted to reflect this change in accounting policy. See
    Note 1 and Note 11 to our consolidated financial
    statements.3
    The calculation of diluted net
    income (loss) per ordinary share assumes the exercise of options
    issued under ASML stock option plans, the issue of shares under
    ASML share plans and the conversion of ASMLs outstanding
    Convertible Subordinated Notes for periods in which exercises,
    issues or conversions would have a dilutive effect. The
    calculation of diluted net income (loss) per ordinary share does
    not assume exercise, issue of shares or conversion of such
    options, shares or conversion of Convertible Subordinated Notes
    for periods in which such exercises, issue of shares or
    conversions would be anti-dilutive.  ASML ANNUAL REPORT 2010
 2




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As of December 31


20061



20071



2008



2009



2010(in thousands, unless otherwise indicated)


EUR



EUR



EUR



EUR



EURConsolidated balance sheets dataCash and cash equivalents


1,655,857



1,271,636



1,109,184



1,037,074



1,949,834Working
    capital4


2,236,173



1,997,988



1,964,906



1,704,714



2,788,649Total
    assets2


3,997,240



4,113,444



3,977,478



3,764,151



6,180,358Long-term
    debt2


424,785



642,332



685,134



699,756



710,060Total shareholders equity


2,148,003



1,891,004



1,988,769



1,774,768



2,773,908Capital stock


10,051



39,206



38,887



39,028



39,293Consolidated statements of cash flows dataDepreciation and
    amortization2


90,128



129,380



121,423



141,631



151,444Impairment


17,354



9,022



25,109



15,896



8,563Net cash provided by total operating
    activities2


495,316



704,047



282,979



99,194



940,048Purchases of property, plant and equipment


(70,619
)


(179,152
)


(259,770
)


(104,959
)


(128,728
)Acquisition of subsidiary (net of cash acquired)






(188,011
)










Net cash used in total investing activities


(70,629
)


(362,152
)


(259,805
)


(98,082
)


(124,903
)Capital
    repayment5






(1,011,857
)










Purchase of shares in conjunction with conversion rights of
    bondholders and share-based payments


(678,385
)


(359,856
)


(87,605
)






Dividend paid










(107,841
)


(86,486
)


(86,960
)Deposits from customers


















150,000Net proceeds from issuance of bond






593,755











Net cash provided by (used in) total financing
    activities2


(660,660
)


(718,399
)


(186,471
)


(74,874
)


92,702Net increase (decrease) in cash and cash equivalents


(248,752
)


(384,221
)


(162,452
)


(72,110
)


912,760Ratios and other dataGross profit as a percentage of net sales


40.6



41.1



34.4



28.7



43.4Income (loss) from operations as a percentage of net
    sales2


24.2



21.7



9.8



(10.2
)


27.7Net income (loss) as a percentage of net sales


17.3



17.8



10.9



(9.5
)


22.7Shareholders equity as a percentage of total
    assets2


53.7



46.0



50.0



47.1



44.9Income taxes as a percentage of income (loss) before income taxes


28.2



20.9



(4.1
)


12.0



17.8Sales of systems (in units)


266



260



151



70



197Average selling price of system sales (in millions)


12.1



12.9



16.7



16.8



19.8Value of systems backlog (in
    millions)6,7


2,248.6



1,765.5



857.3



2,113.7



3,855.7Systems backlog (in
    units)6,7


163



89



41



69



157Average selling price of systems backlog (in
    millions)6,7


13.8



19.8



20.9



30.6



24.6Value of booked systems (in
    millions)6,7


4,276.4



3,154.3



1,730.9



2,535.4



6,212.7Net bookings for the year (in
    units)6,7


334



186



103



98



285Average selling price of booked systems (in
    millions)6,7


12.8



17.0



16.8



25.9



21.8Number of payroll employees in FTEs


5,594



6,582



6,930



6,548



7,184Number of temporary employees in FTEs


1,486



1,725



1,329



1,137



2,061Increase (decrease) net sales in percentage


41.6



5.2



(21.6
)


(46.0
)


182.4Number of ordinary shares outstanding (in thousands)


477,099



435,6265



432,074



433,639



436,593ASML share price in
    euro8


18.84



21.66



12.75



24.00



28.90Volatility 260 days in percentage of ASML
    shares9


28.08



27.52



51.14



38.45



30.25Dividend per ordinary share in euro






0.25



0.20



0.20



0.4010Dividend per ordinary share in U.S. dollar






0.39



0.26



0.27



0.5410   4
    Working capital is calculated as
    the difference between total current assets, including cash and
    cash equivalents, and total current liabilities.5
    In 2007, as part of a capital
    repayment program, EUR 1,011.9 million of share
    capital was repaid to our shareholders and the number of
    outstanding ordinary shares was reduced by 11.1 percent
    (pursuant to a synthetic share buyback).6
    Our systems backlog and net
    bookings include only orders for which written authorizations
    have been accepted and system shipment and revenue recognition
    dates within the following 12 months have been assigned.7
    In the past, ASML valued net
    bookings and systems backlog at net system sales value, which
    does not reflect the full order value because it excludes the
    value of options and services related to the systems. As of
    2010, in order to more adequately reflect the business
    circumstances, ASML values net bookings and systems backlog at
    full order value (i.e. including options and services). The
    comparative figures for 2006 through 2009 have been adjusted in
    order to reflect this change.8
    Closing price of ASMLs
    ordinary shares listed on the Official Segment of the stock
    market of Euronext Amsterdam (source: Bloomberg Finance LP).9
    Volatility represents the
    variability in our share price on the Official Segment of the
    stock market of Euronext Amsterdam as measured over the
    260 business days of each year presented (source: Bloomberg
    Finance LP).10
    Subject to approval of the Annual
    General Meeting of Shareholders to be held on April 20,
    2011. The exchange rate used to convert the proposed dividend
    per ordinary share is the exchange rate at the latest
    practicable date before filing.  ASML ANNUAL REPORT 2010
 3




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Exchange Rate
    Information
         February 2011 (throughCalendar Year



2006

2007

2008

2009

2010

February 7, 2011)Period End



1.32

1.46

1.39

1.43

1.33

1.36Average1



1.26

1.37

1.47

1.39

1.33

1.34High



1.33

1.49

1.60

1.51

1.45

1.38Low



1.19

1.29

1.24

1.25

1.20

1.29   1
    The average of the Noon Buying
    Rates on the last business day of each month during the period
    presented.  August


September


October


November


December


January


February 2011 (throughMonths of

2010


2010


2010


2010


2010


2011


February 7, 2011)High


1.3282



1.3638



1.4066



1.4224



1.3395



1.3715



1.3793Low


1.2652



1.2708



1.3688



1.3036



1.3089



1.2944



1.3584  B. Capitalization
    and Indebtedness  C. Reasons
    for the Offer and Use of Proceeds  D. Risk
    Factors    Risks Related to
    the Semiconductor Industry
  The
    Semiconductor Industry is Highly Cyclical and We May Be
    Adversely Affected by Any Downturn
  
    the current and anticipated market demand for semiconductors and
    for products utilizing semiconductors;
    semiconductor prices;
    semiconductor production costs;
    changes in semiconductor inventory levels;
    general economic conditions; and
    access to capital.     ASML ANNUAL REPORT 2010
 4




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and/or
      Our Business
    Will Suffer If We Do Not Respond Rapidly to Commercial and
    Technological Changes in the
    Semiconductor Industry
  
    rapid change towards more complex technologies;
    frequent new product introductions and enhancements;
    evolving industry standards;
    changes in customer requirements; and
    continued shortening of product life cycles.            We Face
    Intense Competition
  
    the technical performance characteristics of a lithography
    system;
    the value of ownership of that system based on its purchase
    price, maintenance costs, productivity, and customer service and
    support costs;
    a strengthening of the euro particularly against the Japanese
    yen which results in lower prices and margins;
    the strength and breadth of our portfolio of patents and other
    intellectual property rights; and
    our customers desire to obtain lithography equipment from
    more than one supplier.  ASML ANNUAL REPORT 2010
 5




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and/or
   Risks Related to
    ASML
  The Number of
    Systems We Can Produce Is Limited by Our Dependence on a Limited
    Number of Suppliers of Key Components
             A High
    Percentage of Net Sales Is Derived from a Few
    Customers
       We Derive Most
    of Our Revenues from the Sale of a Relatively Small Number of
    Products
   ASML ANNUAL REPORT 2010
 6




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
    a downturn in the highly cyclical semiconductor industry;
    unanticipated shipment rescheduling;
    cancellation or order push-back by customers;
    unexpected manufacturing difficulties; and
    delays in deliveries by suppliers,       The Pace of
    Introduction of Our New Products Is Accelerating and Is
    Accompanied by Potential Design and Production Delays and by
    Significant Costs
       Failure to
    Adequately Protect the Intellectual Property Rights Upon Which
    We Depend Could Harm Our Business
  
    intellectual property laws may not sufficiently support our
    proprietary rights or may change in the future in a manner
    adverse to us;
    patent rights may not be granted or construed as we expect;
    patents will expire which may result in key technology becoming
    widely available that may hurt our competitive position;
    the steps we take to prevent misappropriation or infringement of
    our proprietary rights may not be successful; and
    third parties may be able to develop or obtain patents for
    similar competing technology.      Defending
    Against Intellectual Property Claims Brought by Others Could
    Harm Our Business
    and/or
     ASML ANNUAL REPORT 2010
 7




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We Are Subject
    to Risks in Our International Operations
  
    Potentially adverse tax consequences;
    Unfavorable political or economic environments;
    Unexpected legal or regulatory changes; and
    An inability to effectively protect intellectual property.         We Are
    Dependent on the Continued Operation of a Limited Number of
    Manufacturing Facilities
    Because of
    Labor Laws and Practices, Any Workforce Reductions That We May
    Seek to Implement in Order to Reduce Costs Company-Wide May Be
    Delayed or Suspended
    Fluctuations
    in Foreign Exchange Rates Could Harm Our Results of
    Operations
             We May Be
    Unable to Make Desirable Acquisitions or to Integrate
    Successfully Any Businesses We Acquire
   ASML ANNUAL REPORT 2010
 8




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Our Business
    and Future Success Depend on Our Ability to Attract and Retain a
    Sufficient Number of Adequately Educated and Skilled
    Employees
       Risks Related to
    Our Ordinary Shares
  We may not
    declare cash dividends at all or in any particular amounts in
    any given year
    The Price of
    Our Ordinary Shares is Volatile
    Restrictions
    on Shareholder Rights May Dilute Voting Power
        Item 4
    Information on the Company A. History
    and Development of the Company   ASML ANNUAL REPORT 2010
 9




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Capital
    Expenditures and Divestitures
     B. Business
    Overview round-the-clock
   Our Business
    Model
  
    offering ongoing improvements in productivity, imaging and
    overlay by introducing advanced technology based on modular
    platforms and advanced applications outside the traditional
    lithography business, each resulting in lower costs per product
    for our customers;
    providing customer services that ensure rapid, efficient
    installation and superior
    on-site
    support and training to optimize manufacturing processes of our
    customers and improve productivity;
    maintaining appropriate levels of R&D to offer the most
    advanced technology suitable for high-throughput and low-cost
    volume production at the earliest possible date;
    enhancing the capabilities of the installed base of our
    customers through ongoing field upgrades of key value drivers
    (productivity, imaging and overlay) based on further technology
    developments;
    reducing the cycle time between a customers order of a
    system and the use of that system in volume production
    on-site;
    expanding operational flexibility in research and manufacturing
    by reinforcing strategic alliances with world class partners,
    including outsourcing companies;
    improving the reliability and uptime of our installed system
    base; and
    providing refurbishing services that effectively increase
    residual value by extending the life of equipment.   Market and
    Technology Overview
  Introduction
         ASML ANNUAL REPORT 2010
 10




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Customer
    Roadmaps
    state-of-the-art
   Products
                      Product
    Development
         ASML ANNUAL REPORT 2010
 11




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set-up
   ramp-up time-to-market
   set-up
               tm tm
        ASML ANNUAL REPORT 2010
 12




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Current ASML
    lithography product portfolio of Step & Scan
    Systems
  Resolution

Wavelength

Lightsource

Numerical aperturePAS 5500 SYSTEMSPAS 5500/4X0

280 nm

365 nm

i-line

0.48-0.65PAS 5500/750

130 nm

248 nm

KrF

0.50-0.70PAS 5500/850

110 nm

248 nm

KrF

0.55-0.80PAS 5500/1150

90 nm

193 nm

ArF

0.50-0.75TWINSCAN SYSTEMSTWINSCAN XT:400

350 nm

365 nm

i-line

0.48-0.65TWINSCAN XT:450

220 nm

365 nm

i-line

0.48-0.65TWINSCAN XT:8X0

110 nm

248 nm

KrF

0.55-0.80TWINSCAN XT:1000

80 nm

248 nm

KrF

0.50-0.93TWINSCAN XT:1450

57 nm

193 nm

ArF

0.65-0.93TWINSCAN XT:1700 immersion

45 nm

193 nm

ArF

0.75-1.20TWINSCAN XT:1900 immersion

40 nm

193 nm

ArF

0.85-1.35TWINSCAN XT:1950 immersion

38 nm

193 nm

ArF

0.85-1.35TWINSCAN NXT:1950 immersion

38 nm

193 nm

ArF

0.85-1.35EUVNXE:3100

27 nm

13.5 nm

EUV

0.25NXE:3300

22 nm

13.5 nm

EUV

0.33   Notes:
  
    This table does not include older
    (including pre-used) products sold on the PAS 2500, PAS 5000 and
    PAS 5500 platforms.
    XT is a TWINSCAN system for 200 and
    300 mm wafer sizes.
    Wavelength refers to the frequency
    of light going through projection lenses; the shorter the
    wavelength, the smaller the line-width and the finer the pattern
    on the IC.
    1 nm is equal to one billionth of a
    meter.
    The X in the number represents
    different models in the product portfolio within the same
    resolution. For example XT:8X0 can either represent XT:800 or
    XT:850.
    NXT is an improved version of the
    current TWINSCAN system, introducing new stages and stage
    position control technology, which enable improved imaging and
    overlay.
    NXE is a TWINSCAN system with
    complete new technologies in three areas: light source (EUV),
    lens system and vacuum body.   Sales, Customer
    Support and Customers
          Customers and
    Geographic Regions
       Manufacturing,
    Logistics and Suppliers
   ASML ANNUAL REPORT 2010
 13




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
    maintaining long-term relationships with our suppliers;
    sharing risks and rewards with our suppliers;
    dual sourcing of knowledge, globally, together with our
    suppliers; and
    single, dual or multiple sourcing of products, where possible or
    required.                        24-hour, days-a-week
   Research and
    Development
   ASML ANNUAL REPORT 2010
 14




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Intellectual
    Property
      ASML ANNUAL REPORT 2010
 15




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Competition
  
    the technical performance characteristics of a lithography
    system;
    the value of ownership of that system based on its purchase
    price, maintenance costs and productivity;
    a strengthening of the euro particularly against the Japanese
    yen which results in lower prices and margins;
    the strength and breadth of our portfolio of patent and other
    intellectual property rights; and
    our customers desire to obtain lithography equipment from
    more than one supplier.      Government
    Regulation
  C. Organizational
    Structure   
    D. Property,
    Plant and Equipment   ASML ANNUAL REPORT 2010
 16




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Facilities in
    Europe
 state-of-the-art
   Facilities in the
    United States
    Facilities in
    Asia
  Item 4A
    Unresolved Staff Comments      Item 5
    Operating and Financial Review and Prospects
 Executive
    Summary   Introduction
          Semiconductor
    equipment industry conditions
   ASML ANNUAL REPORT 2010
 17




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Year Ended December 31

2005

2006

2007

2008

2009

20101Total units shipped

536

633

604

344

128

286Total value (in millions USD)

4,988

6,386

7,144

5,388

2,485

6,299   (Source: Gartner Dataquest)
 1
    Full year 2010 estimates are
    according to the latest available data up to and including
    December 2010.      Business
    strategy
       Sustainability
    Governance
   ASML ANNUAL REPORT 2010
 18




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Sustainability
    Strategy
  
    Sustainable Operations:  Our objective is to
    ensure that our employees working conditions are safe and
    healthy. In addition, we continuously improve the environmental
    performance of our operations by developing new initiatives to
    prevent or reduce harmful emissions to air, soil and water.
    Sustainable Products:  Our objective is to
    create new shrink technology to continue the
    exponential improvement in energy efficiency of computing
    systems through a sustained level of investments in R&D,
    and to improve the energy efficiency of our products. In
    addition, we aim to guarantee the safety performance of our
    products and auxiliary equipment through appropriate design.
    Sustainable Value Chain:  Our objective is to
    continuously improve the performance and sustainability of our
    supply chain, as well as to cooperate with our customers to
    positively influence their impact on environment and society.
    Sustainable Culture:  Our objective is to
    continuously improve on providing employment that inspires our
    highly skilled work force and respects their cultural and
    individual differences. In addition, we care for the local and
    global communities in which we operate.   Customer
    focus
               ASML ANNUAL REPORT 2010
 19




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##### Table of Contents



Strategic
    investment in research and development
    cost-per-exposure
                  Operational
    excellence
      ASML ANNUAL REPORT 2010
 20




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##### Table of Contents



24-hour, days-a-week
      ASML operations
    update on key performance indicators
     Year ended December 31

2008





2009





2010(in millions)

EUR





EUR





EURSalesNet sales


2,953.7







1,596.1







4,507.9Increase (decrease) in net sales (%)


(21.6)







(46.0)







182.4Net system sales


2,516.8







1,174.9







3,894.7Sales of systems (in units)


151







70







197Average selling price of system sales


16.7







16.8







19.8Value of systems
    backlog1


857.3







2,113.7







3,855.7Systems backlog (in
    units)1


41







69







157Average selling price of systems
    backlog1


20.9







30.6







24.6Average selling price of systems backlog
    (New)1


24.9







33.0







27.7Average selling price of systems backlog
    (Used)1


4.6







10.0







5.1NXT systems sold (in units)










3







34ProfitabilityGross profit


1,015.5



34.4%



458.4



28.7
%


1,955.2



43.4%Income (loss) from
    operations2


289.2



9.8%



(163.1)



(10.2)
%


1,250.7



27.7%Net income (loss)


322.4



10.9%



(150.9)



(9.5)
%


1,021.8



22.7%LiquidityCash and cash equivalents


1,109.2







1,037.1







1,949.8Operating cash
    flow2


283.0







99.2







940.0   1
    In the past, ASML valued net
    bookings and systems backlog at net system sales value, which
    does not reflect the full order value because it excludes the
    value of options and services related to the systems. As of
    2010, in order to more adequately reflect the business
    circumstances, ASML values net bookings and systems backlog at
    full order value (i.e. including options and services). The
    comparative figures for 2008 and 2009 have been adjusted in
    order to reflect this change.2
    As of January 1, 2010 ASML
    adopted ASC 810 Amendments to FIN 46(R)
    which resulted in the consolidation of the VIE that owns
    ASMLs headquarters in Veldhoven, the Netherlands. The
    comparative figures for 2008 and 2009 have been adjusted to
    reflect this change in accounting policy. See Note 1 and
    Note 11 to our consolidated financial statements.   Sales
    ramp-ups.
     ASML ANNUAL REPORT 2010
 21




---



##### Table of Contents



ramp-up
   ramp-up.
   Profitability
       ramp-ups.
            Liquidity
   ASML ANNUAL REPORT 2010
 22




---



##### Table of Contents



A. Operating
    Results   Critical
    accounting policies using significant estimates
    Revenue
    recognition
         ASML ANNUAL REPORT 2010
 23




---



##### Table of Contents



work-in-process
                  Warranty
 and/or
  ASML ANNUAL REPORT 2010
 24




---



##### Table of Contents



Year Ended December 31

2008(in thousands, except per share data)

EUR


%Income from operations


33,409



11.6%Net income


24,890



7.7%Basic net income per ordinary share


0.06



8.0%Diluted net income per ordinary share


0.06



8.1%    Evaluation of
    long-lived assets for impairment and costs associated with exit
    or disposal activities
           
    Cash flow projections for the coming five years are based on a
    significant growth scenario, reflecting the
    start-up
    nature of Brion. Projections are built
    bottom-up,
    using estimates for revenue, gross profit, R&D costs and
    SG&A costs.
    Brion would reach maturity in the final year of this five year
    period and grow at a weighted average growth rate of
    3.0 percent from then onwards, which Management believes is
    a reasonable estimate that does not exceed the long-term
    historical average growth rate for the lithography business in
    which Brion operates.
    A post-tax discount rate of 13.1 percent representing
    Brions weighted average cost of capital (WACC)
    based on market participants view, was determined using an
    adjusted version of the Capital Asset Pricing Model. Since Brion
    is not financed with debt, WACC was assumed to equal
    Brions cost of equity. The discount rate decreased
    compared with the prior year, reflecting the recovery of the
    semiconductor equipment industry.       
    Estimated cash flows associated with Brions operations
    after the initial five year period accounted for
    70.9 percent of the reporting units estimated fair
    value, based on the assumed 3.0 percent growth rate.
    Assuming Managements estimate of cash flows for the
    initial five year period is unchanged; growth in subsequent
    years could reduce to zero percent without Brions
    estimated fair value falling below its carrying amount of
    EUR 201.9 million. Management does not believe,
    however, that such a long-term no growth scenario is reasonably
    likely, given that the long-term historical growth rate of the
    lithography industry exceeds 3.0 percent.
    The estimated cash flows associated with Brions initial
    five year period including the estimated cash flows after the
    initial five year period, could be reduced by up to
    26.5 percent without causing the fair value of Brion to
    decrease below its carrying amount of
    EUR 201.9 million. Management does not believe that
    such a decline is reasonably likely based on Managements
    future expectations on the development of these cash flows.
    The discount rate used in the fair value calculation could
    increase from 13.1 percent to 16.1 percent without
    causing the fair value of Brion to decrease below its carrying
    amount of EUR 201.9 million. Management does not
    believe such an increase is reasonably likely.  ASML ANNUAL REPORT 2010
 25




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##### Table of Contents



Inventories
 (first-in,
         Accounts
    receivable
   ASML ANNUAL REPORT 2010
 26




---



##### Table of Contents



Provisions
          Contingencies and
    litigation
       Share-based
    compensation expenses
            ASML ANNUAL REPORT 2010
 27




---



##### Table of Contents



Income
    taxes
                  As of December 31

2009


2010(in millions)

EUR


EURBalance, January 1


124.2



133.3Gross increases  tax positions in prior period


6.4



8.6Gross decreases  tax positions in prior period


(1.8
)


(1.1
)Gross increases  tax positions in current period


10.6



24.7Settlements


(4.3
)


(3.4
)Lapse of statute of limitations


(1.8
)


Total liability for unrecognized tax benefits


133.3



162.1Less: current portion of liability for unrecognized tax benefits






18.2Non-current portion of liability for unrecognized tax
    benefits


133.3



143.9               ASML ANNUAL REPORT 2010
 28




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##### Table of Contents



Results of
    Operations
      Year ended December 31

2008


2009


2010(in millions)

EUR


EUR


EURTotal net sales


2,953.7



1,596.1



4,507.9Cost of sales


1,938.2



1,137.7



2,552.7Gross profit on sales


1,015.5



458.4



1,955.2Research and development costs


516.1



466.8



523.4Selling, general and administrative
    costs1


210.2



154.7



181.1Income (loss) from
    operations1


289.2



(163.1
)


1,250.7Interest income (expense),
    net1


20.5



(8.4
)


(8.2
)Income (loss) from operations before income taxes


309.7



(171.5
)


1,242.5(Provision for) benefit from income taxes


12.7



20.6



(220.7
)Net income (loss)


322.4



(150.9
)


1,021.8   1
    As of January 1, 2010 ASML
    adopted ASC 810 Amendments to FIN 46(R)
    which resulted in the consolidation of the VIE that owns
    ASMLs headquarters in Veldhoven, the Netherlands. The
    comparative figures for 2008 and 2009 have been adjusted to
    reflect this change in accounting policy. See Note 1 and
    Note 11 to our consolidated financial statements.     Year ended December 31(as a percentage of net sales)

2008


2009


2010Total net sales


100.0



100.0



100.0Cost of sales


65.6



71.3



56.6Gross profit on sales


34.4



28.7



43.4Research and development costs


17.5



29.2



11.6Selling, general and administrative
    costs1


7.1



9.7



4.1Income (loss) from
    operations1


9.8



(10.2
)


27.7Interest income (expense),
    net1


0.7



(0.5
)


(0.1
)Income (loss) from operations before income taxes


10.5



(10.7
)


27.6(Provision for) benefit from income taxes


0.4



1.2



(4.9
)Net income (loss)


10.9



(9.5
)


22.7   1
    As of January 1, 2010 ASML
    adopted ASC 810 Amendments to FIN 46(R)
    which resulted in the consolidation of the VIE that owns
    ASMLs headquarters in Veldhoven, the Netherlands. The
    comparative figures for 2008 and 2009 have been adjusted to
    reflect this change in accounting policy. See Note 1 and
    Note 11 to our consolidated financial statements.  ASML ANNUAL REPORT 2010
 29




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##### Table of Contents



Results of
    operations 2010 compared with 2009
  Net sales and
    gross profit
   2009








2010First


Second


Full


First


Second


Fullhalf year


half year


year


half year


half year


yearNet sales (EUR million)


460.2



1,135.9



1,596.1



1,810.5



2,697.4



4,507.9Net system sales (EUR million)


284.4



890.5



1,174.9



1,554.6



2,340.1



3,894.7Net service and field option sales (EUR million)


175.8



245.4



421.2



255.9



357.3



613.2Total sales of systems (in units)


21



49



70



77



120



197Total sales of new systems (in units)


11



36



47



58



96



154Total sales of used systems (in units)


10



13



23



19



24



43Gross profit as a percentage of net sales


10.2



36.2



28.7



41.9



44.4



43.4ASP of system sales (EUR million)


13.5



18.2



16.8



20.2



19.5



19.8ASP of new system sales (EUR million)


20.1



21.5



21.1



25.7



23.1



24.1ASP of used system sales (EUR million)


6.3



9.1



7.9



3.4



5.2



4.4    ramp-ups.
            ramp-ups.
     ASML ANNUAL REPORT 2010
 30




---



##### Table of Contents



ramp-up
   Research and
    development costs
    Selling,
    general and administrative costs
    Interest
    income (expense), net
    Income
    taxes
            ASML ANNUAL REPORT 2010
 31




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##### Table of Contents



Results of
    operations 2009 compared with 2008
  Net sales and
    gross profit
   2008








2009First


Second


Full


First


Second


Fullhalf year


half year


year


half year


half year


yearNet sales (EUR million)


1,763.4



1,190.3



2,953.7



460.2



1,135.9



1,596.1Net system sales (EUR million)


1,545.6



971.2



2,516.8



284.4



890.5



1,174.9Net service and field option sales (EUR million)


217.8



219.1



436.9



175.8



245.4



421.2Total sales of systems (in units)


89



62



151



21



49



70Total sales of new systems (in units)


74



41



115



11



36



47Total sales of used systems (in units)


15



21



36



10



13



23Gross profit as a percentage of net sales


40.3



25.6



34.4



10.2



36.2



28.7ASP of system sales (EUR million)


17.4



15.7



16.7



13.5



18.2



16.8ASP of new system sales (EUR million)


20.0



21.2



20.4



20.1



21.5



21.1ASP of used system sales (EUR million)


4.6



4.9



4.8



6.3



9.1



7.9       ramp-up
                 ASML ANNUAL REPORT 2010
 32




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##### Table of Contents



Research and
    development costs
    Selling,
    general and administrative costs
    Interest
    income (expense), net
    Income
    taxes
       Foreign Exchange
    Management
    New U.S.
    GAAP Accounting Pronouncements
 810-10)
           ASML ANNUAL REPORT 2010
 33




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##### Table of Contents



Paragraph 810-10-10-1 states Paragraph 810-10-15-8 states
           As of December 31

2009


2010(in millions)

EUR


EURProperty, plant and equipment


36.7



35.2Long-term debt


36.7



35.2       2010-06,
   2010-20,
   820-10-65-4,
  ASML ANNUAL REPORT 2010
 34




---



##### Table of Contents



2010-09,
   2009-13, 2009-13 605-25)
   2009-14, 2009-14 985-605) 2009-14
    B. Liquidity and
    Capital Resources               ASML ANNUAL REPORT 2010
 35




---



##### Table of Contents



C. Research
    and Development, Patents and Licenses, etc.   Research and
    Development
    Intellectual
    Property Matters
  D. Trend
    Information   ASML ANNUAL REPORT 2010
 36




---



##### Table of Contents



Year ended December 31

20091


20101New systems backlog (in units)


62



135Used systems backlog (in units)


7



22Total systems backlog (in units)


69



157Value of new systems backlog (EUR million)


2,043.6



3,744.3Value of used systems backlog (EUR million)


70.1



111.4Total value of systems backlog (EUR million)


2,113.7



3,855.7ASP of new systems backlog (EUR million)


33.0



27.7ASP of used systems backlog (EUR million)


10.0



5.1ASP of total systems backlog (EUR million)


30.6



24.6   1
    In the past, ASML valued net
    bookings and systems backlog at net system sales value, which
    does not reflect the full order value because it excludes the
    value of options and services related to the systems. As of
    2010, in order to more adequately reflect the business
    circumstances, ASML values net bookings and systems backlog at
    full order value (i.e. including options and services). The
    comparative figures for 2009 have been adjusted in order to
    reflect this change.      ramp-up
   catch-up
          E. Off-Balance
    Sheet Arrangements   ASML ANNUAL REPORT 2010
 37




---



##### Table of Contents



F. Tabular
    Disclosure of Contractual Obligations   Less than








AfterPayments due by period

Total


1 year


1-3 years


3-5 years


5 years(In thousands)

EUR


EUR


EUR


EUR


EURLong Term Debt Obligations, including interest
    expense1


951,560



35,929



71,859



71,859



771,913Deposits from customers


150,000



150,000











Operating Lease Obligations


106,671



30,088



40,188



22,802



13,593Purchase Obligations


2,098,432



2,003,321



94,942



169



Unrecognized Tax Benefits


162,066



29,956



30,853



40,062



61,195Contractual Obligations


3,468,729



2,249,294



237,842



134,892



846,701   1
    See Note 14 to our
    consolidated financial statements for the amounts excluding
    interest expense.           Purchase options




Less than








Afterdue by period

Total


1 year


1-3 years


3-5 years


5 years(In thousands)

EUR


EUR


EUR


EUR


EURPurchase options


31,232







8,250



8,999



13,983        G. Safe
    Harbor   ASML ANNUAL REPORT 2010
 38




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##### Table of Contents



Item 6
    Directors, Senior Management and Employees A. Directors and
    Senior Management   Name

Title

Year of Birth


Term ExpiresArthur P.M. van der
    Poel1,2,3

Chairman of the Supervisory Board


1948



2012Jos W.B.
    Westerburgen2,4

Member of the Supervisory Board


1942



2011Fritz W.
    Fröhlich1

Member of the Supervisory Board


1942



2012Hendrika (Ieke) C.J. van den
    Burg4

Member of the Supervisory Board


1952



2013OB
    Bilous2,3

Member of the Supervisory Board


1938



2012William T.
    Siegle3

Member of the Supervisory Board


1939



2011Pauline F.M. van der Meer
    Mohr4

Member of the Supervisory Board


1960



2013Wolfgang H.
    Ziebart1,3

Member of the Supervisory Board


1950



2013Eric Meurice

President, Chief Executive Officer and Chairman of the Board of
    Management


1956



2012Peter T.F.M. Wennink

Executive Vice President, Chief Financial Officer and Member of
    the Board of Management


1957



N/A 5Martin A. van den Brink

Executive Vice President, Chief Product and Technology Officer
    and Member of the Board of Management


1957



N/A 5Frits J. van Hout

Executive Vice President, Chief Marketing Officer and Member of
    the Board of Management


1960



2013Frederic Schneider-Maunoury

Executive Vice President, Chief Operating Officer and Member of
    the Board of Management


1961



2014   1
    Member of the Audit Committee.2
    Member of the Selection and
    Nomination Committee.3
    Member of the Technology and
    Strategy Committee.4
    Member of the Remuneration
    Committee.5
    There are no specified terms for
    members of the Board of Management appointed prior to March 2004.            Director and
    Officer Biographies
  Arthur P.M.
    van der Poel
    Jos W.B.
    Westerburgen
    Fritz W.
    Fröhlich
   ASML ANNUAL REPORT 2010
 39




---



##### Table of Contents



Hendrika
    (Ieke) C.J. van den Burg
 Monitoring Foundation Dutch Insurance Companies Dutch Data Protection Authority Dutch
    National Register Supervisory Directors
   OB
    Bilous
    William T.
    Siegle
    Pauline P.M.
    van der Meer Mohr
    Wolfgang H.
    Ziebart
    Eric
    Meurice
    Peter T.F.M.
    Wennink
    Martin A. van
    den Brink
    Frits J. van
    Hout
   ASML ANNUAL REPORT 2010
 40




---



##### Table of Contents



Frederic
    Schneider-Maunoury
  B.
    Compensation       Bonus and
    Profit-sharing plans
    Pension
    plans
  C. Board
    Practices   General
        
    provide shareholders with regular, reliable, relevant and
    transparent information regarding our activities, structure,
    financial condition, performance and other information,
    including information on our social, ethical and environmental
    records and policies;
    apply high quality standards for disclosure, accounting and
    auditing; and
    apply stringent rules with regard to insider securities trading.   Two-tier board
    structure
       Board of
    Management
   ASML ANNUAL REPORT 2010
 41




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##### Table of Contents



Supervisory
    Board
                Approval of
    Board of Management Decisions
  
    a transfer of all or substantially all of the business of ASML
    to a third party;
    entering into or the termination of a long-term material joint
    venture between ASML and a third party; and
    an acquisition or divestment by ASML of an interest in the
    capital of a company with a value of at least one-third of
    ASMLs assets (determined by reference to ASMLs most
    recently adopted annual accounts).   Rules of
    Procedure
    Directors and
    Officers Insurance and Indemnification
   ASML ANNUAL REPORT 2010
 42




---



##### Table of Contents



Corporate
    Governance Developments
          Committees of
    ASMLs Supervisory Board
       Audit
    Committee
     
    overseeing the integrity of our financial statements and related
    (non)financial disclosure;
    overseeing the qualifications, independence and performance of
    the external auditor; and
    overseeing the integrity of our systems of disclosure controls
    and procedures and the system of internal controls over
    financial reporting.      Remuneration
    Committee
            ASML ANNUAL REPORT 2010
 43




---



##### Table of Contents



Selection and
    Nomination Committee
     
    preparing the selection criteria and appointment procedures for
    members of the Companys Supervisory Board and Board of
    Management;
    periodically evaluating the scope and composition of the Board
    of Management and the Supervisory Board, and proposing the
    profile of the Supervisory Board in relation thereto;
    periodically evaluating the functioning of the Board of
    Management and the Supervisory Board and the individual members
    of those boards and reporting the results thereof to the
    Supervisory Board; and
    proposing (re-)appointments of members of the Board of
    Management and the Supervisory Board, and supervising the policy
    of the Board of Management in relation to the selection and
    appointment criteria for senior management.      Technology and
    Strategy Committee
 and/or
    
    familiarization with and risk assessment and study of potential
    strategies, required technical resources, technology roadmaps
    and product roadmaps; and
    providing advice to the Supervisory Board with respect to
    matters related thereto.      Disclosure
    Committee
        D.
    Employees   As of December 31

2008


2009


2010Payroll Employees


6,930



6,548



7,184Temporary Employees


1,329



1,137



2,061Employees (in FTEs)


8,259



7,685



9,245   ASML ANNUAL REPORT 2010
 44




---



##### Table of Contents



E. Share
    Ownership  Item 7 Major
    Shareholders and Related Party Transactions A. Major
    Shareholders Autoriteit Financiële Markten;
  SharesIdentity of Person or Group

Owned


Percent of ClassFMR LLC 1


49,292,206



11.3%Capital World
    Investors2


25,132,167



5.8%Members of ASMLs Supervisory Board and Board of
    Management, as a group
    (5 persons)3,4


1,948,689



0.4%   1
    Based solely on the
    Schedule 13-G/A
    filed by FMR LLC with the Commission on February 16, 2010.2
    Based solely on the
    Schedule 13-G/A
    filed by Capital World Investors with the Commission on
    February 14, 2011.3
    For further information, please
    refer to Note 20 of our consolidated financial statements.4
    No shares are owned by members of
    the Supervisory Board.            Obligations of
    Shareholders to Disclose Holdings under Dutch Law
 Wet op
    het financieel toezicht
  ASML ANNUAL REPORT 2010
 45




---



##### Table of Contents



and/or and/or
      and/or and/or
                   B. Related Party
    Transactions   ASML ANNUAL REPORT 2010
 46




---



##### Table of Contents



C. Interests of
    Experts & Counsel  Item 8
    Financial Information A. Consolidated
    Statements and Other Financial Information   Consolidated
    Statements
    Export
    Sales
    Legal
    Proceedings
    Dividend
    Policy
  B. Significant
    Changes  Item 9 The
    Offer and Listing A. Offer and
    Listing Details            ASML ANNUAL REPORT 2010
 47




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##### Table of Contents



NASDAQ


Euronext AmsterdamUSD


EURHigh


Low


High


LowAnnual Information2006


25.83



18.46



19.90



14.492007


35.79



22.89



24.99



17.152008


30.47



12.66



20.97



10.682009


34.67



14.28



24.24



11.352010


38.45



24.73



29.26



19.68Quarterly Information1st quarter 2009


18.58



14.28



14.20



11.352nd quarter 2009


22.12



17.77



16.22



13.423rd quarter 2009


30.31



21.21



20.55



15.114th quarter 2009


34.67



26.67



24.24



18.381st quarter 2010


35.56



30.58



26.57



22.232nd quarter 2010


35.99



27.14



26.83



21.963rd quarter 2010


33.02



24.73



25.15



19.684th quarter 2010


38.45



29.48



29.26



21.07Monthly InformationAugust 2010


33.02



24.73



25.02



19.68September 2010


30.49



25.98



22.31



20.40October 2010


33.61



29.48



24.09



21.07November 2010


34.83



31.85



26.42



23.50December 2010


38.45



34.44



29.26



26.15January 2011


42.88



35.90



31.08



27.35February (through February 7) 2011


43.95



43.10



32.65



31.34   (Source: Bloomberg Finance LP)
 B. Plan of
    Distribution  C.
    Markets  D. Selling
    Shareholders  E.
    Dilution  F. Expenses of
    the Issue   ASML ANNUAL REPORT 2010
 48




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##### Table of Contents



Item 10
    Additional Information A. Share
    Capital  B. Memorandum and
    Articles of Association Form 6-K,
   Current
    Authorizations to Issue and Repurchase Ordinary Shares
    and/or and/or
       C. Material
    Contracts  D. Exchange
    Controls   ASML ANNUAL REPORT 2010
 49




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##### Table of Contents



E.
    Taxation   Dutch
    Taxation
    General
    Substantial
    Interest
    Income Tax
    Consequences for Individual Non-resident Holders on Owning and
    Disposing of the Ordinary Shares
  
    Does not carry on and has not carried on a business in the
    Netherlands through a permanent establishment or a permanent
    representative to which the ordinary shares are attributable;
    Does not hold and has not held a (deemed) substantial interest
    in our share capital or, in the event the Non-resident Holder
    holds or has held a (deemed) substantial interest in our share
    capital, such interest is, or was, a business asset in the hands
    of the holder;
    Does not share and has not shared directly (through the
    beneficial ownership of ordinary shares or similar securities)
    in the profits of an enterprise managed and controlled in the
    Netherlands which (is deemed to) own(s), or (is deemed to have)
    has owned, our ordinary shares;
    Does not carry out and has not carried out any activities which
    generate taxable profit or taxable wages to which the holding of
    our ordinary shares was connected;
    Does not carry out and has not carried out employment activities
    in the Netherlands, does not serve and has not served as a
    director or board member of any entity resident in the
    Netherlands, and does not serve and has not served as a civil
    servant of a Dutch public entity with which the holding of our
    ordinary shares is or was connected; and
    Is not an individual that has elected to be taxed as a resident
    of the Netherlands.   Corporate
    Income Tax Consequences for Corporate Non-resident
    Holders
  
    The holder carries on a business in the Netherlands through a
    permanent establishment or a permanent agent in the Netherlands
    (Dutch enterprise) and the ordinary shares are attributable to
    this permanent establishment or permanent agent, unless the
    participation exemption (discussed below) applies; or
    The holder has a substantial interest in our share capital,
    which is not attributable to his enterprise; or
    Certain assets of the holder are deemed to be treated as a Dutch
    enterprise under Dutch tax law and the ordinary shares are
    attributable to this Dutch enterprise.      Dividend
    Withholding Tax
     
    Dividends in cash and in kind;
    Deemed and constructive dividends;  ASML ANNUAL REPORT 2010
 50




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##### Table of Contents




    Consideration for the repurchase or redemption of ordinary
    shares (including a purchase by a direct or indirect ASML
    subsidiary) in excess of qualifying average paid-in capital
    unless such repurchase is made for temporary investment purposes
    or is exempt by law;
    Stock dividends up to their nominal value (unless distributed
    out of qualifying paid-in capital);
    Any (partial) repayment of paid-in capital not qualifying as
    capital for Dutch dividend withholding tax purposes; and
    Liquidation proceeds in excess of qualifying average paid-in
    capital for Dutch dividend withholding tax purposes.    
    The participation exemption applies and the ordinary shares are
    attributable to a business carried out in the Netherlands;
    The dividends are distributed to a qualifying EU corporate
    holder satisfying the conditions of the EU Parent-Subsidiary
    Directive; or
    The rate is reduced by a Tax Treaty.         Dividend
    Stripping Rules
    Gift or
    Inheritance Taxes
          he/she
   Value Added
    Tax
    Residence
 and/or
  ASML ANNUAL REPORT 2010
 51




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##### Table of Contents



United States
    Taxation
 mark-to-market non-United
   U.S.-Dutch non-United
    
    an individual citizen or tax resident of the United States;
    a corporation or other entity treated as a corporation for
    United States federal income tax purposes created or organized
    in or under the laws of the United States or of any political
    subdivision thereof;
    an estate of which the income is subject to United States
    federal income taxation regardless of its source; or
    a trust whose administration is subject to the primary
    supervision of a court within the United States and which has
    one or more United States persons who have the authority to
    control all of its substantial decisions.      Passive
    Foreign Investment Company Considerations
    Taxation of
    Dividends
   ASML ANNUAL REPORT 2010
 52




---



##### Table of Contents



non-United
   U.S.-source
   non-United non-United non-United
      Taxation on Sale
    or Other Disposition of Ordinary Shares
    Information
    Reporting and Backup Withholding
   ASML ANNUAL REPORT 2010
 53




---



##### Table of Contents



F. Dividends and
    Paying Agents  G. Statement by
    Experts  H. Documents on
    Display Form 20-F Form 20-F Form 20-F. Form 6-K.
   60661-2511. http://www.sec.gov. 1-800-SEC-0330
 I. Subsidiary
    Information  Item 11
    Quantitative and Qualitative Disclosures About Market
    Risk         Foreign currency
    risk management
         ASML ANNUAL REPORT 2010
 54




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##### Table of Contents



Interest rate
    risk management
       Financial
    instruments
    2009





2010Notional





NotionalAs of December 31

Amount


Fair Value


Amount


Fair Value(in thousands)

EUR


EUR


EUR


EURCurrency
    contracts1


527,816



7,428



(1,933
)


(28,974
)Interest rate
    swaps2


641,500



78,485



641,500



90,256   1
    Relates to forward contracts
    assigned as a hedge to forecasted sales and purchase
    transactions, to monetary assets and liabilities, mainly in
    U.S. dollar and Japanese Yen.2
    Relates to interest rate swaps
    assigned as a hedge to interest bearing assets and liabilities
    mainly related to the EUR 600.0 million Eurobond; the
    fair value of the interest rate swaps includes accrued interest.         Credit risk
    management
      ASML ANNUAL REPORT 2010
 55




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##### Table of Contents



Liquidity and
    Capital risk management
                Sensitivity
    analysis financial instruments
  Foreign
    currency sensitivity
    2009





2010Impact on





Impact onincome from





income fromoperations





operationsbefore income


Impact on


before income


Impact ontaxes


equity


taxes


equity(in thousands)

EUR


EUR


EUR


EURU.S. dollar


(3,689
)


24,903



(6,048
)


39,802Japanese yen


(1,711
)


(32,416
)


(4,207
)


1,320Other currencies


(1,620
)


12,080



(700
)


15,634Total


(7,020
)


4,567



(10,955
)


56,756   ASML ANNUAL REPORT 2010
 56




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##### Table of Contents



Interest rate
    sensitivity
    20102009





Impact onImpact on





income fromincome from





operationsoperations


Impact on


before income


Impact onbefore income taxes


equity


taxes


equity(in thousands)

EUR


EUR


EUR


EUR4,425



2,336



13,274



1,986      Item 12
    Description of Securities Other Than Equity Securities     ASML ANNUAL REPORT 2010
 57




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##### Table of Contents



Part II   Item 13
    Defaults, Dividend Arrearages and Delinquencies    Item 14
    Material Modifications to the Rights of Security Holders and Use
    of Proceeds    Item 15
    Controls and Procedures   Disclosure
    Controls and Procedures
 Rule 13a-15(e)
   Managements
    Report on Internal Control over Financial Reporting
 Rule 13a-15(f)
      Changes in
    Internal Control over Financial Reporting
    Inherent
    Limitations of Disclosure Controls and Procedures in Internal
    Control over Financial Reporting
  Item 16 A. Audit
    Committee Financial Expert  B. Code of
    Ethics day-to-day
  ASML ANNUAL REPORT 2010
 58




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##### Table of Contents




    Honest and ethical conduct, including the ethical handling of
    actual or apparent conflicts of interest between personal and
    professional relationships;
    Full, fair, accurate, timely, and understandable disclosure in
    reports and documents that ASML files with, or submits to, the
    SEC and in other public communications made by ASML;
    Compliance with applicable governmental laws, rules and
    regulations;
    Prompt internal reporting of violations of the Internal
    Guidelines on Ethical Business Conduct to an appropriate person
    or persons identified in these guidelines; and
    Accountability for adherence to the guidelines. C. Principal
    Accountant Fees and Services and/or
  2009








2010Deloitte








DeloitteAccountants


Deloitte





Accountants


DeloitteYear ended December 31

B.V.


Network


Total


B.V.


Network


Total(in thousands)

EUR


EUR


EUR


EUR


EUR


EURAudit fees in relation to annual reports


744







744



860







860Other audit fees


40



407



447



40



584



624Audit-related fees


75







75



75







75Tax fees






723



723







598



598Principal accountant fees and services


859



1,130



1,989



975



1,182



2,157    Audit fees and
    other audit fees
 Form 20-F,
   Audit-related
    fees
    Tax
    fees
   Year ended December 31

2009


2010(in thousands)

EUR


EURCorporate Income Tax compliance services


113



350Tax assistance for expatriate employees


172



163Other tax advisory and compliance


438



85Tax fees


723



598      ASML ANNUAL REPORT 2010
 59




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##### Table of Contents



D. Exemptions
    from the Listing Standards for Audit Committees  E. Purchases of
    Equity Securities by the Issuer and Affiliated
    Purchasers   Total valueTotal Number





of Sharesof Shares


Maximum


Purchased asAverage


Purchased as


Number of


Part of PubliclyPrice


Part of Publicly


Shares That May


AnnouncedTotal Number of


Paid per


Announced


Yet be Purchased


Plans orShares


Share


Plans or


Under the


Programs (inProgram

Period


purchased


(EUR)


Programs


Programs


EUR million)2006-2007 Share
    program


May 17-26, 2006



6,412,920



15.59



6,412,920



19,037,376



1002006-2007 Share
    program


June 7-30, 2006



13,517,078



15.81



19,929,998



5,520,298



3142006-2007 Share
    program


July 3-13, 2006



5,520,298



15.62



25,450,296







4002006-2007 Share
    program


October 12, 2006



14,934,843



18.55



14,934,843







2772006-2007 Share
    program


February 14-23, 2007



8,000,000



19.53



8,000,000







156Capital repayment program 2007


September - October 2007



55,093,409



18.36



55,093,409







1,0122007-2008 Share
    program


November 14-26, 2007



9,000,000



22.62



9,000,000



5,000,000



2042007-2008 Share
    program


January 17-22, 2008



5,000,000



17.52



14,000,000







292    2006-2007 Share
    program
          Capital repayment
    program 2007
    2007-2008 Share
    program
   ASML ANNUAL REPORT 2010
 60




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##### Table of Contents



2007-2008 share
      Authorization of
    share repurchases
  F. Change in
    Registrants Certifying Accountant  G. Corporate
    governance  
    ASML does not follow NASDAQs quorum requirements
    applicable to meetings of ordinary shareholders. In accordance
    with Dutch law and Dutch generally accepted business practice,
    ASMLs Articles of Association provide that there are no
    quorum requirements generally applicable to General Meetings of
    Shareholders.
    ASML does not follow NASDAQs requirements regarding the
    provision of proxy statements for General Meetings of
    Shareholders. Dutch law does not have a regulatory regime for
    the solicitation of proxies: the solicitation of proxies is not
    a generally accepted business practice in the Netherlands. ASML
    does provide shareholders with an agenda and other relevant
    documents for the General Meeting of Shareholders.
    ASML does not follow NASDAQs requirement regarding
    distribution to shareholders of copies of an annual report
    containing audited financial statements prior to the
    Companys Annual General Meeting of Shareholders. The
    distribution of annual reports to shareholders is not required
    under Dutch corporate law or Dutch securities laws, or by
    Euronext Amsterdam. Furthermore, it is generally accepted
    business practice for Dutch companies not to distribute annual
    reports. In part, this is because the Dutch system of bearer
    shares has made it impractical to keep a current list of holders
    of the bearer shares in order to distribute the annual reports.
    Instead, we make our annual report available at our corporate
    head office in the Netherlands (and at the offices of our Dutch
    listing agent as stated in the convening notice for the meeting)
    approximately two weeks prior to convocation of the Annual
    General Meeting of Shareholders. In addition, we post a copy of
    our annual report on our website prior to the Annual General
    Meeting of Shareholders.
    ASML does not follow NASDAQs requirement to obtain
    shareholder approval of stock option or purchase plans or other
    equity compensation arrangements available to officers,
    directors or employees. It is not required under Dutch law or
    generally accepted practice for Dutch companies to obtain
    shareholder approval of equity compensation arrangements
    available to officers, directors or employees. The Annual
    General Meeting of Shareholders adopts the remuneration policy
    for the Board of Management, approves equity compensation
    arrangements for the Board of Management and approves the
    remuneration for the Supervisory Board. The actual total
    remuneration (including equity compensation) for individual
    members of the Board of Management is determined by the
    Supervisory Board. Equity compensation arrangements for
    employees are adopted by the Board of Management within limits
    approved by the Annual General Meeting of Shareholders.  ASML ANNUAL REPORT 2010
 61




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##### Table of Contents



Part III Item 17
    Financial Statements    Item 18
    Financial Statements    Item 19
    Exhibits  Exhibit No.

Description1

Articles of Association of ASML Holding N.V. (English
    translation) (Incorporated by reference to Amendment No. 11 to
    the Registrants Registration Statement on
    Form 8-A/A,
    filed with the Commission on November 2, 2007)2.1

Fiscal Agency Agreement between ASML Holding N.V., Deutsche Bank
    AG, London Branch and Deutsche Bank Luxembourg S.A. relating to
    the Registrants 5.75 percent Notes due 2017
    (Incorporated by reference to the Registrants Annual
    Report for the year ended December 31, 2008)4.1

Agreement between ASM Lithography B.V. and Carl Zeiss, dated
    March 17, 2000 (Incorporated by reference to the
    Registrants Annual Report on
    Form 20-F
    for the fiscal year ended December 31, 2000) #4.2

Agreement between ASML Holding N.V. and Carl Zeiss, dated
    October 24, 2003 (Incorporated by reference to the
    Registrants Annual Report on
    Form 20-F
    for the year ended December 31, 2003) #4.3

Form of Indemnity Agreement between ASML Holding N.V. and
    members of its Board of Management (Incorporated by reference to
    the Registrants Annual Report on
    Form 20-F
    for the year ended December 31, 2003)4.4

Form of Indemnity Agreement between ASML Holding N.V. and
    members of its Supervisory Board (Incorporated by reference to
    the Registrants Annual Report on
    Form 20-F
    for the year ended December 31, 2003)4.5

Form of Employment Agreement for members of the Board of
    Management (Incorporated by reference to the Registrants
    Annual Report on
    Form 20-F
    for the fiscal year ended December 31, 2003)4.6

Nikon-ASML Patent Cross-License Agreement, dated
    December 10, 2004, between ASML Holding N.V. and Nikon
    Corporation (Incorporated by reference to the Registrants
    Annual Report on
    Form 20-F
    for the fiscal year ended December 31, 2004) #4.7

ASML/Zeiss Sublicense Agreement, 2004, dated December 10,
    2004, between Carl Zeiss SMT AG and ASML Holding N.V.
    (Incorporated by reference to the Registrants Annual
    Report on
    Form 20-F
    for the fiscal year ended December 31, 2004) #4.8

ASML New Hires and Incentive Stock Option Plan For Management
    (Version 2003) (Incorporated by reference to the
    Registrants Statement on
    Form S-8,
    filed with the Commission on September 2, 2003 (File
    No. 333-109154))4.9

ASML Incentive and New Hire Option Plan for Board of Management
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8,
    filed with the Commission on June 9, 2004 (File
    No. 333-116337))4.10

ASML Option Plan for Management of ASML Holding Group Companies
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on June 30, 2005 (file
    No. 333-126340))4.11

ASML Stock Option Plan for New Hire Options granted to Members
    of the Board of Management (Version April 2006) (Incorporated by
    reference to the Registrants Registration Statement on
    Form S-8
    filed with the Commission on August 7, 2006 (file
    No. 333-136362))4.12

ASML Stock Option Plan for Incentive or New Hire Options granted
    to Senior and Executive Management (Version April 2006)
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on August 7, 2006 (file
    No. 333-136362))4.13

ASML Stock Option Plan for Incentive or New Hire Options granted
    to Senior and Executive Management (Version July 2006)
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on August 7, 2006 (file
    No. 333-136362))4.14

ASML Stock Option Plan for Incentive or New Hire Options granted
    to Senior and Executive Management (Version October 2006)
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on August 7, 2006 (file
    No. 333-136362))4.15

ASML Restricted Stock Plan (Incorporated by reference to the
    Registrants Registration Statement on
    Form S-8
    filed with the Commission on March 7, 2007 (file
    No. 333-141125))4.16

Brion Technologies, Inc., 2002 Stock Option Plan (as amended on
    March 25, 2005; March 24, 2006; and November 17,
    2006) (Incorporated by reference to the Registrants
    Registration Statement on
    Form S-8
    filed with the Commission on April 20, 2007 (file
    No. 333-142254))4.17

ASML Stock Option Plan for Incentive or New Hire Options granted
    to Senior and Executive Management (Version January 2007)
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on July 5, 2007 (file
    No. 333-144356))  ASML ANNUAL REPORT 2010
 62




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##### Table of Contents



Exhibit No.

Description4.18

ASML Stock Option Plan for Incentive or New Hire Options granted
    to Senior and Executive Management (Version April 2007)
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on July 5, 2007 (file
    No. 333-144356))4.19

ASML Stock Option Plan for Incentive or New Hire Options granted
    to Senior and Executive Management (Version July 2007)
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on July 5, 2007 (file
    No. 333-144356))4.20

ASML Stock Option Plan for Incentive or New Hire Options granted
    to Senior and Executive Management (Version October 2007)
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on July 5, 2007 (file
    No. 333-144356))4.21

ASML Performance Stock Plan for Members of the Board of
    Management (Version 1) (Incorporated by reference to the
    Registrants Registration Statement on
    Form S-8
    filed with the Commission on July 5, 2007 (file
    No. 333-144356))4.22

ASML Performance Stock Option Plan for Members of the Board of
    Management (Version 2) (Incorporated by reference to the
    Registrants Registration Statement on
    Form S-8
    filed with the Commission on July 5, 2007 (file
    No. 333-144356))4.23

ASML Stock Option Plan from Base Salary for Senior &
    Executive Management (Version October 2007) (Incorporated by
    reference to the Registrants Registration Statement on
    Form S-8
    filed with the Commission on November 2, 2007 (file
    No. 333-147128))4.24

ASML Performance Stock Option Plan for Senior and Executive
    Management (version 1) (Incorporated by reference to the
    Registrants Registration Statement on
    Form S-8
    filed with the Commission on August 29, 2008 (file
    No. 333-153277))4.25

ASML Performance Share Plan for Senior and Executive Management
    (version 1) (Incorporated by reference to the Registrants
    Registration Statement on
    Form S-8
    filed with the Commission on August 29, 2008 (file
    No. 333-153277))4.26

ASML Restricted Stock Plan (version 2) (Incorporated by
    reference to the Registrants Registration Statement on
    Form S-8
    filed with the Commission on August 29, 2008 (file
    No. 333-153277))4.27

ASML Performance Stock Plan for Members of the Board of
    Management (Incorporated by reference to the Registrants
    Registration Statement on
    Form S-8
    filed with the Commission on October 13, 2009 (file
    No. 333-162439))4.28

ASML Performance Stock Option Plan for Senior and Executive
    Management (version 1) (Incorporated by reference to the
    Registrants Registration Statement on
    Form S-8
    filed with the Commission on October 13, 2009 (file
    No. 333-162439))4.29

ASML Performance Share Plan for Senior and Executive Management
    (version 1) (Incorporated by reference to the Registrants
    Registration Statement on
    Form S-8
    filed with the Commission on October 13, 2009 (file
    No. 333-162439))4.30

ASML Share and Option Purchase Plan for Employees (Incorporated
    by reference to the Registrants Registration Statement of
    Form S-8
    filed with the Commission on October 20, 2010 (file
    No. 333-170034)8.1

List of Subsidiaries*12.1

Certification of CEO and CFO Pursuant to
    Rule 13a-14(a)
    of the Securities Exchange Act of 1934*13.1

Certification of CEO and CFO Pursuant to
    Rule 13a-14(b)
    of the Securities Exchange Act of 1934 and 18 U.S.C.
    Section 1350 as Adopted Pursuant to Section 906 of the
    Sarbanes-Oxley Act of 2002*15.1

Consent of Deloitte Accountants B.V.*  *
    Filed at the Commission herewith#
    Certain information omitted
    pursuant to a request for confidential treatment filed
    separately with the Securities and Exchange Commission   Form 20-F
  
   
        
        ASML ANNUAL REPORT 2010
 63




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##### Table of Contents



Financial Statements




---



##### Table of Contents



ASML ANNUAL REPORT 2010




---



##### 



Index to Financial
    Statements
  
  F-2

Consolidated Statements of Operations for the
    years ended December 31, 2008, 2009 and 2010F-2

Consolidated Statements of Comprehensive Income
    for the years ended December 31, 2008, 2009 and 2010F-3

Consolidated Balance Sheets as of
    December 31, 2009 and 2010F-4

Consolidated Statements of Shareholders
    Equity as of December 31, 2008, 2009 and 2010F-5

Consolidated Statements of Cash Flows for the
    years ended December 31, 2008, 2009 and 2010F-6

Notes to the Consolidated Financial StatementsF-52

Report of Independent Registered Public
    Accounting Firm    ASML ANNUAL REPORT 2010
 F-1




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##### Table of Contents



Consolidated
    Statements of Operations  Year ended December 31

2008


2009


2010Notes

(in thousands, except per share data)

EUR


EUR


EUR19

Net system sales


2,516,762



1,174,858



3,894,742Net service and field option sales


436,916



421,205



613,19619

Total net sales


2,953,678



1,596,063



4,507,938Cost of system sales


1,631,069



852,417



2,222,965Cost of service and field option sales


307,095



285,254



329,80321

Total cost of sales


1,938,164



1,137,671



2,552,768Gross profit on sales


1,015,514



458,392



1,955,17021, 22

Research and development costs


516,128



466,761



523,42621

Selling, general and administrative
    costs1


210,172



154,756



181,045Income (loss) from operations


289,214



(163,125
)


1,250,69923

Interest income


72,497



42,766



15,12523

Interest
    expense1


(52,067
)


(51,191
)


(23,301
)Income (loss) from operations before income taxes


309,644



(171,550
)


1,242,52318

(Provision for) benefit from income taxes


12,726



20,625



(220,703
)Net income (loss)


322,370



(150,925
)


1,021,820Basic net income (loss) per ordinary share


0.75



(0.35
)


2.35Diluted net income (loss) per ordinary
    share2


0.74



(0.35
)


2.33Number of ordinary shares used in computing per share amounts
    (in thousands)Basic


431,620



432,615



435,146Diluted2


434,205



432,615



438,974   1
    As of January 1, 2010 ASML
    adopted Accounting Standards Codification (ASC) 810
    Amendments to FIN 46(R) which resulted in the
    consolidation of the Variable Interest Entity (VIE)
    that owns ASMLs headquarters in Veldhoven, the
    Netherlands. The comparative figures for 2008 and 2009 have been
    adjusted to reflect this change in accounting policy. See
    Note 1 and Note 11.2
    The calculation of diluted net
    income (loss) per ordinary share assumes the exercise of options
    issued under ASML stock option plans and the issue of shares
    under ASML share plans for periods in which exercises or issues
    would have a dilutive effect. The calculation of diluted net
    income (loss) per ordinary share does not assume exercise of
    such options or issue of shares when such exercises or issue
    would be anti-dilutive. Consolidated
    Statements of Comprehensive Income  Year ended December 31

2008


2009


2010Notes

(in thousands)

EUR


EUR


EURNet income (loss)


322,370



(150,925
)


1,021,8203

Gain (loss) on foreign currency translation, net of taxes


(12,734
)


(8,592
)


22,2863

Gain (loss) on derivative instruments, net of taxes


(43,579
)


6,494



(1,221
)Comprehensive income (loss)


266,057



(153,023
)


1,042,885   ASML ANNUAL REPORT 2010
 F-2




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##### Table of Contents



Consolidated
    Balance Sheets  As of December 31

2009


2010Notes

(in thousands, except share and per share data)

EUR


EURAssets4

Cash and cash equivalents


1,037,074



1,949,8345

Accounts receivable, net


377,439



1,123,5346

Finance receivables, net


21,553



12,64818

Current tax assets


11,286



12,6787

Inventories, net


963,382



1,497,18018

Deferred tax assets


119,404



134,4298

Other assets


218,746



214,162Total current assets


2,748,884



4,944,4656

Finance receivables, net






28,90518

Deferred tax assets


133,263



71,0088

Other assets


77,054



235,7129

Goodwill


131,462



141,28610

Other intangible assets, net


18,128



13,65111

Property, plant and equipment,
    net1


655,360



745,331Total non-current assets


1,015,267



1,235,893Total assets


3,764,151



6,180,358Liabilities and shareholders equityAccounts payable


206,226



555,39712

Accrued and other liabilities


817,361



1,518,74918

Current tax liabilities


15,032



61,19713

Provisions


2,504



2,25018

Deferred and other tax liabilities


3,047



18,223Total current liabilities


1,044,170



2,155,81614

Long-term
    debt1


699,756



710,06018

Deferred and other tax liabilities


188,404



155,69313

Provisions


12,694



11,81112

Accrued and other liabilities


44,359



373,070Total non-current liabilities


945,213



1,250,634Total liabilities


1,989,383



3,406,45015, 17

Commitments and contingencies






Cumulative Preference Shares; EUR 0.02 nominal value;
    3,150,005,000 shares authorized;none issued and outstanding at December 31, 2009 and 2010






Ordinary Shares; EUR 0.09 nominal value; 700,000,000 shares
    authorized;
    433,638,976 outstanding at December 31, 2009;
    436,592,972 outstanding at December 31, 2010;
    EUR 0.01 nominal value; 10,000 shares authorized;
    none issued and outstanding at December 31, 2009 and 2010


39,028



39,293Share premium


476,261



471,253Treasury shares at cost


(218,203
)


(151,672
)Retained earnings


1,450,156



2,366,443Accumulated other comprehensive income


27,526



48,59125

Total shareholders equity


1,774,768



2,773,908Total liabilities and shareholders equity


3,764,151



6,180,358   1
    As of January 1, 2010 ASML
    adopted ASC 810 Amendments to FIN 46(R)
    which resulted in the consolidation of the VIE that owns
    ASMLs headquarters in Veldhoven, the Netherlands. The
    comparative figures for 2009 have been adjusted to reflect this
    change in accounting policy. See Note 1 and Note 11.  ASML ANNUAL REPORT 2010
 F-3




---



##### Table of Contents



Consolidated
    Statements of Shareholders Equity  Treasury





AccumulatedIssued and outstanding Shares


Share


Shares


Retained


Other ComprehensiveAmount


Premium


at cost


Earnings


Income


TotalNotes

(in thousands)

Number1


EUR


EUR


EUR


EUR


EUR


EURBalance at January 1, 2008


435,626



39,206



463,846



(198,893
)


1,500,908



85,937



1,891,004Components of comprehensive income:Net income


















322,370







322,3703

Foreign Currency Translation, net of taxes






















(12,734
)


(12,734
)3

Loss on derivative instruments, net of taxes






















(43,579
)


(43,579
)16, 20, 21

Share-based payments










13,535















13,535Purchase of shares in conjunction with26

share-based payment plans


(5,000
)


(450
)






(87,155
)










(87,605
)16, 20

Issuance of shares and stock options


1,448



131



(4,760
)


32,612



(16,508
)






11,47525

Dividend paid


















(107,841
)






(107,841
)Tax benefit from stock options










2,144















2,144Balance at December 31, 2008


432,074



38,887



474,765



(253,436
)


1,698,929



29,624



1,988,769Components of comprehensive income:Net loss


















(150,925
)






(150,925
)3

Foreign Currency Translation, net of taxes






















(8,592
)


(8,592
)3

Gain on derivative instruments, net of taxes






















6,494



6,49416, 20, 21

Share-based payments










13,394















13,39416, 20

Issuance of shares and stock options


1,565



141



(13,852
)


35,233



(11,362
)






10,16025

Dividend paid


















(86,486
)






(86,486
)Tax benefit from stock options










1,954















1,954Balance at December 31, 2009


433,639



39,028



476,261



(218,203
)


1,450,156



27,526



1,774,768Components of comprehensive income:Net income


















1,021,820







1,021,8203

Foreign Currency Translation, net of taxes






















22,286



22,2863

Loss on derivative instruments, net of taxes






















(1,221
)


(1,221
)16, 20, 21

Share-based payments










12,109















12,10916, 20

Issuance of shares and stock options


2,954



265



(17,223
)


66,531



(18,573
)






31,00025

Dividend paid


















(86,960
)






(86,960
)Tax benefit from stock options










106















106Balance at December 31, 2010


436,593



39,293



471,253



(151,672
)


2,366,443



48,591



2,773,908   1
    As of December 31, 2010, the
    number of issued shares was 444,480,095. This includes the
    number of issued and outstanding shares of 436,592,972 and the
    number of treasury shares of 7,887,123. As of December 31,
    2009, the number of issued shares was 444,480,095. This includes
    the number of issued and outstanding shares of 433,638,976 and
    the number of treasury shares of 10,841,119.  ASML ANNUAL REPORT 2010
 F-4




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##### Table of Contents



Consolidated
    Statements of Cash Flows  Year ended December 31

2008


2009


2010Notes

(in thousands)

EUR


EUR


EURCash Flows from Operating ActivitiesNet income (loss)


322,370



(150,925
)


1,021,820Adjustments to reconcile net income (loss) to net cash flows
    from operating activities:10, 11

Depreciation and
    amortization1


121,423



141,631



151,4449, 10, 11

Impairment


25,109



15,896



8,56311

Loss on disposals of property, plant and
    equipment2


4,257



4,053



2,91316, 20

Share-based payments


13,535



13,394



12,1095

Allowance for doubtful debts


188



1,889



(1,256
)7

Allowance for obsolete inventory


139,628



86,636



55,69118

Deferred income taxes


(34,155
)


(49,423
)


28,053Changes in assets and liabilities:5

Accounts receivable


169,402



81,838



(748,898
)6

Finance receivables


(37,255
)


15,702



(20,000
)7

Inventories2


(87,804
)


(158,024
)


(706,233
)8

Other assets


(76,342
)


4,893



(114,003
)Accounts payable


(94,375
)


10,430



350,23118

Current income taxes


(158,277
)


71,267



36,69512, 13

Other liabilities


(24,725
)


9,937



862,919Net cash provided by operating activities


282,979



99,194



940,048Cash Flows from Investing Activities11

Purchases of property, plant and
    equipment2


(259,770
)


(104,959
)


(128,728
)11

Proceeds from sale of property, plant and
    equipment2






6,877



3,82510

Purchases of intangible assets


(35
)






Net cash used in investing activities


(259,805
)


(98,082
)


(124,903
)Cash Flows from Financing Activities26

Purchase of shares in conjunction with share-based payments


(87,605
)






16, 20

Net proceeds from issuance of shares and stock options


11,475



11,073



31,00025

Dividend paid


(107,841
)


(86,486
)


(86,960
)Deposits from customers










150,00014

Net proceeds from other long-term debt






32



14

Repayment of
    debt1


(4,644
)


(1,447
)


(1,444
)16, 18

Tax benefits from stock options


2,144



1,954



106Net cash provided by (used in) financing activities


(186,471
)


(74,874
)


92,702Net cash flows


(163,297
)


(73,762
)


907,847Effect of changes in exchange rates on cash


845



1,652



4,913Net increase (decrease) in cash and cash equivalents


(162,452
)


(72,110
)


912,7604

Cash and cash equivalents at beginning of the year


1,271,636



1,109,184



1,037,0744

Cash and cash equivalents at end of the year


1,109,184



1,037,074



1,949,834Supplemental Disclosures of Cash Flow Information:Interest
    paid1


42,416



42,123



35,559Taxes paid (received)


167,360



(36,705
)


148,915   1
    As of January 1, 2010 ASML
    adopted ASC 810 Amendments to FIN 46(R)
    which resulted in the consolidation of the VIE that owns
    ASMLs headquarters in Veldhoven, the Netherlands. The
    comparative figures for 2008 and 2009 have been adjusted to
    reflect this change in accounting policy. See Note 1 and
    Note 11.2
    An amount of
    EUR 214.1 million (2009: EUR 159.0 million,
    2008: EUR 62.3 million) of the additions in property,
    plant and equipment relates to non-cash transfers from inventory
    and an amount of EUR 110.4 million (2009:
    EUR 27.8 million, 2008: EUR 27.8 million) of
    the disposals of property, plant and equipment relates to
    non-cash transfers to inventory.  ASML ANNUAL REPORT 2010
 F-5




---



##### Table of Contents



Notes
    to the Consolidated Financial Statements   1. General
    information/Summary of significant accounting policies
       Basis of
    preparation
       Use of
    estimates
    Principles of
    consolidation
    Subsidiaries
       Variable Interest
    Entities
    Foreign currency
    translation
    Derivative
    instruments
   ASML ANNUAL REPORT 2010
 F-6




---



##### Table of Contents




    A hedge of the exposure to changes in the fair value of a
    recognized asset or liability, or of an unrecognized firm
    commitment, that are attributable to a particular risk (fair
    value hedge);
    A hedge of the exposure to variability in the cash flows of a
    recognized asset or liability, or of a forecasted transaction,
    that is attributable to a particular risk (cash flow
    hedge); or
    A hedge of the foreign currency exposure of a net investment in
    a foreign operation (net investment hedge). In 2009, the Company
    decided to no longer hedge these U.S. dollar net
    investments exposures.      Fair value
    hedge
          Cash flow
    hedge
          Net investment
    hedge
   ASML ANNUAL REPORT 2010
 F-7




---



##### Table of Contents



Cash and cash
    equivalents
    Inventories
 (first-in,
      Goodwill
    Other intangible
    assets
   Category

Estimated useful lifeIntellectual property


3  10 yearsDeveloped technology


6 yearsCustomer relationships


8 yearsOther


2  6 years    Property, plant
    and equipment
      Category

Estimated useful lifeBuildings and constructions


5  40 yearsMachinery and equipment


2  5 yearsLeasehold improvements


5  10 yearsFurniture, fixtures and other equipment


3  5 years     and/or
  ASML ANNUAL REPORT 2010
 F-8




---



##### Table of Contents



Evaluation of
    long-lived assets for impairment
          Provisions
          Revenue
    recognition
         ASML ANNUAL REPORT 2010
 F-9




---



##### Table of Contents



work-in-process
                  Warranty
       Accounting for
    shipping and handling fees and costs
   ASML ANNUAL REPORT 2010
 F-10




---



##### Table of Contents



Cost of
    sales
          Research and
    development costs and credits
    Share-based
    payments
             Income
    taxes
          Contingencies and
    litigation
   ASML ANNUAL REPORT 2010
 F-11




---



##### Table of Contents



Net income (loss)
    per ordinary share
      Year ended December 31

2008


2009


2010(in thousands, except per share data)

EUR


EUR


EURNet income (loss)


322,370



(150,925
)


1,021,820Weighted average number of shares outstanding (after
    deduction of treasury stock) during the year


431,620



432,615



435,146Basic net income (loss) per ordinary share


0.75



(0.35
)


2.35Weighted average number of shares:


431,620



432,615



435,146Plus shares applicable to:Options and restricted
    shares1


2,585







3,828Dilutive potential ordinary shares


2,585







3,828Adjusted weighted average number of shares


434,205



432,615



438,974Diluted net income (loss) per ordinary
    share1


0.74



(0.35
)


2.33   1
    The calculation of diluted net
    income (loss) per ordinary share assumes the exercise of options
    issued under ASML stock option plans and the issue of shares
    under ASML share plans for periods in which exercises or issues
    would have a dilutive effect. The calculation of diluted net
    income (loss) per ordinary share does not assume exercise of
    such options or issue of shares when such exercises or issue
    would be anti-dilutive.   Comprehensive
    income
       New U.S.
    GAAP Accounting Pronouncements
 810-10)
  ASML ANNUAL REPORT 2010
 F-12




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##### Table of Contents



Paragraph 810-10-10-1 states Paragraph 810-10-15-8 states
           As of December 31

2009


2010(in millions)

EUR


EURProperty, plant and equipment


36.7



35.2Long-term debt


36.7



35.2       2010-06,
   2010-20,
   820-10-65-4,
  ASML ANNUAL REPORT 2010
 F-13




---



##### Table of Contents



2010-09,
   2009-13, 2009-13 605-25)
   2009-14, 2009-14 985-605) 2009-14
      2. Fair value
    measurements
   
    Level 1:  Valuations based on inputs such
    as quoted prices for identical assets or liabilities in active
    markets that the entity has the ability to access.
    Level 2:  Valuations based on inputs other
    than level 1 inputs such as quoted prices for similar
    assets or liabilities, quoted prices in markets that are not
    active, or other inputs that are observable or can be
    corroborated by observable data for substantially the full term
    of the assets or liabilities.
    Level 3:  Valuations based on inputs that
    are supported by little or no market activity and that are
    significant to the fair value of the assets or liabilities.      Financial assets
    and financial liabilities measured at fair value on a recurring
    basis
    over-the-counter
     ASML ANNUAL REPORT 2010
 F-14




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##### Table of Contents



As of December 31, 2009

Level 1


Level 2


Level 3


Total(In thousands)

EUR


EUR


EUR


EURAssetsDerivative financial
    instruments1






103,384







103,384Cash and cash
    equivalents2


302,736



734,338







1,037,074Financial assets


302,736



837,722







1,140,458LiabilitiesLong-term
    debt3,4






699,756







699,756Derivative financial
    instruments1






17,471







17,471Financial liabilities






717,227







717,227   As of December 31, 2010

Level 1


Level 2


Level 3


Total(In thousands)

EUR


EUR


EUR


EURAssetsDerivative financial
    instruments1






96,180







96,180Cash and cash
    equivalents2


203,922



1,745,912







1,949,834Financial assets


203,922



1,842,092







2,046,014LiabilitiesLong-term
    debt3






710,060







710,060Derivative financial
    instruments1






34,898







34,898Financial liabilities






744,958







744,958    1
    Derivative financial instruments
    consist of forward contracts and interest rate swaps. See
    Note 3.  2
    Based on a reassessment of the
    Level classifications, in 2010, the Company concluded that Money
    Market Funds should be classified Level 1 instead of
    Level 2, as they are valued based on quoted prices for
    identical assets in active markets accessible to the Company.
    The comparative figures were adjusted accordingly to reflect
    this change in classification.3
    Long-term debt mainly relates to
    the Companys EUR 600.0 million Eurobond and
    excludes accrued interest. For further details see Note 14.4
    As of January 1, 2010 ASML
    adopted Accounting Standards Codification (ASC) 810
    Amendments to FIN 46(R) which resulted in the
    consolidation of the Variable Interest Entity (VIE)
    that owns ASMLs headquarters in Veldhoven, the
    Netherlands. The comparative figures for 2008 and 2009 have been
    adjusted to reflect this change in accounting policy. See
    Note 1 and Note 11.     ASML ANNUAL REPORT 2010
 F-15




---



##### Table of Contents



Assets and
    liabilities measured at fair value on a nonrecurring
    basis
       3. Market risks
    and derivatives
       Foreign currency
    risk management
                Interest rate
    risk management
      ASML ANNUAL REPORT 2010
 F-16




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##### Table of Contents



Financial
    instruments
   2009





2010Notional





NotionalAs of December 31

Amount


Fair Value


Amount


Fair Value(In thousands)

EUR


EUR


EUR


EURCurrency
    contracts1


527,816



7,428



(1,933
)


(28,974
)Interest rate
    swaps2


641,500



78,485



641,500



90,256   1
    Relates to forward contracts
    assigned as a hedge to forecasted sales and purchase
    transactions, to monetary assets and liabilities, mainly in U.S.
    dollar and Japanese Yen.2
    Relates to interest rate swaps
    assigned as a hedge to interest bearing assets and liabilities
    mainly related to the EUR 600.0 million Eurobond; the
    fair value of the interest rate swaps includes accrued interest.     2009





2010As of December 31

Assets


Liabilities


Assets


Liabilities(In thousands)

EUR


EUR


EUR


EURInterest rate swaps  cash flow hedges






3,326







3,091Interest rate swaps  fair value hedges


81,811







93,347



Forward foreign exchange contracts  cash flow hedges


1,592



13,222



1,533



11,535Forward foreign exchange contracts  other hedges (no
    hedge accounting)


19,981



923



1,300



20,272Total


103,384



17,471



96,180



34,898Less non-current portion:Interest rate swaps  cash flow hedges






1,935







1,887Interest rate swaps  fair value hedges


55,948







71,779



Forward foreign exchange contracts  cash flow hedges














94Total non-current portion


55,948



1,935



71,779



1,981Total current portion


47,436



15,536



24,401



32,917           Currency
    contracts
         ASML ANNUAL REPORT 2010
 F-17




---



##### Table of Contents



Interest rate
    swaps
    Credit risk
    management
          Liquidity and
    Capital risk management
          4. Cash and cash
    equivalents
      ASML ANNUAL REPORT 2010
 F-18




---



##### Table of Contents



5. Accounts
    receivable
   As of December 31

2009


2010(in thousands)

EUR


EURAccounts receivable, gross


380,678



1,125,479Allowance for doubtful receivables


(3,239
)


(1,945
)Accounts receivable, net


377,439



1,123,534         As of December 31

2009


2010(in thousands)

EUR


EURBalance at beginning of year


(1,430
)


(3,239
)Utilization of the provision


80



38(Addition)/release for the
    year1


(1,889
)


1,256Allowance for doubtful receivables


(3,239
)


(1,945
)   1
    (Addition)/release for the year is
    recorded in cost of sales.   6. Finance
    receivables
   As of December 31

2009


2010(in thousands)

EUR


EURFinance receivables, gross


22,444



48,398Unearned interest


(891
)


(6,845
)Finance receivables, net


21,553



41,553Current portion of finance receivables, gross


22,444



16,594Current portion of unearned interest


(891
)


(3,946
)Non-current portion of finance receivables, net






28,905      (in thousands)

EUR2011


16,5942012


18,8982013


12,9062014


2015


Thereafter


Finance receivables, gross


48,398   ASML ANNUAL REPORT 2010
 F-19




---



##### Table of Contents



7.
    Inventories
   As of December 31

2009


2010(In thousands)

EUR


EURRaw materials


175,045



248,969Work-in-process


799,390



1,083,932Finished products


194,153



353,514Inventories, gross


1,168,588



1,686,415Allowance for obsolescence and/or lower market value


(205,206
)


(189,235
)Inventories, net


963,382



1,497,180       and/or
  As of December 31

2009


2010(in thousands)

EUR


EURBalance at beginning of year


(167,353
)


(205,206
)Addition for the year


(86,636
)


(55,691
)Effect of exchange rates


(260
)


(4,148
)Utilization of the provision


49,043



75,810Allowance for obsolescence and/or lower market value


(205,206
)


(189,235
)         ASML ANNUAL REPORT 2010
 F-20




---



##### Table of Contents



8. Other
    assets
   As of December 31

2009


2010(in thousands)

EUR


EURAdvance payments to Zeiss


73,759



65,821Prepaid expenses


38,832



46,325Derivative instruments


47,436



24,401VAT


25,211



35,065Other receivables


30,802



41,298Other


2,706



1,252Other current assets


218,746



214,162    work-in-process
           As of December 31

2009


2010(in thousands)

EUR


EURAdvance payments to Zeiss






140,016Derivative instruments


55,948



71,779Compensation plan
    assets1


8,520



9,626Prepaid expenses


5,893



7,617Subordinated loan granted to lessorin respect of Veldhoven
    headquarters2


5,445



5,445Other


1,248



1,229Other non-current assets


77,054



235,712   1
    For further details on compensation
    plan assets see Note 16.2
    For further details on loan granted
    to lessor in respect of Veldhoven headquarters see Note 11.        ASML ANNUAL REPORT 2010
 F-21




---



##### Table of Contents



9.
    Goodwill
   As of December 31

2009


2010(in thousands)

EUR


EURCostBalance, January 1


131,453



131,462Effect of exchange rates


9



9,824Goodwill


131,462



141,286        
    Cash flow projections for the coming five years are based on a
    significant growth scenario, reflecting the
    start-up
    nature of Brion. Projections are built
    bottom-up,
    using estimates for revenue, gross profit, R&D costs and
    SG&A costs.
    Brion would reach maturity in the final year of this five year
    period and grow at a weighted average growth rate of
    3.0 percent from then onwards, which Management believes is
    a reasonable estimate that does not exceed the long-term
    historical average growth rate for the lithography business in
    which Brion operates.
    A post-tax discount rate of 13.1 percent representing
    Brions weighted average cost of capital (WACC)
    based on market participants view, was determined using an
    adjusted version of the Capital Asset Pricing Model. Since Brion
    is not financed with debt, WACC was assumed to equal
    Brions cost of equity. The discount rate decreased
    compared with the prior year, reflecting the recovery of the
    semiconductor equipment industry.     ASML ANNUAL REPORT 2010
 F-22




---



##### Table of Contents



10. Other
    intangible assets
   Intellectual


Developed


Customer


In-processproperty


technology


relationships


R&D


Other


Total(in thousands)

EUR


EUR


EUR


EUR


EUR


EURCostBalance, January 1, 2009


47,250



24,494



8,263



23,148



2,195



105,350Effect of exchange rates






1











1



2Balance, December 31, 2009


47,250



24,495



8,263



23,148



2,196



105,352Effect of exchange rates






1,388



470







35



1,893Balance, December 31, 2010


47,250



25,883



8,733



23,148



2,231



107,245Accumulated amortization and impairmentBalance, January 1, 2009


43,577



8,406



1,894



23,148



1,633



78,658Amortization


3,436



4,019



1,075







254



8,784Effect of exchange rates






(157
)


(42
)






(19
)


(218
)Balance, December 31, 2009


47,013



12,268



2,927



23,148



1,868



87,224Amortization


211



4,052



1,084







108



5,455Effect of exchange rates






723



174







18



915Balance, December 31, 2010


47,224



17,043



4,185



23,148



1,994



93,594Carrying amountDecember 31, 2009


237



12,227



5,336







328



18,128December 31, 2010


26



8,840



4,548







237



13,651               (in thousands)

EUR2011


5,2852012


5,2852013


1,7942014


1,0952015


186Thereafter


6Amortization expenses


13,651   ASML ANNUAL REPORT 2010
 F-23




---



##### Table of Contents



11. Property,
    plant and equipment
   Land,


Machinery





Furniture,buildings and


and


Leasehold


fixtures and otherconstructions


equipment


improvements


equipment


Total(in thousands)

EUR


EUR


EUR


EUR


EURCostBalance, January 1,
    20091


409,985



483,398



153,824



288,297



1,335,504Additions


74,135



179,050



3,484



7,258



263,927Disposals


(2,247
)


(127,152
)


(2,403
)


(9,457
)


(141,259
)Effect of exchange rates


360



(2,162
)


61



386



(1,355
)Balance, December 31,
    20091


482,233



533,134



154,966



286,484



1,456,817Additions


38,528



244,123



31,015



29,129



342,795Disposals


(2,876
)


(187,181
)


(1,103
)


(1,844
)


(193,004
)Effect of exchange rates


8,970



19,177



757



2,475



31,379Balance, December 31, 2010


526,855



609,253



185,635



316,244



1,637,987Accumulated depreciation and impairmentBalance, January 1,
    20091


70,279



353,468



101,102



231,931



756,780Depreciation1


24,041



63,614



15,851



27,568



131,074Impairment charges






11,185



155



4,556



15,896Disposals


(2,247
)


(88,815
)


(2,191
)


(9,298
)


(102,551
)Effect of exchange rates


(30
)


41



12



235



258Balance, December 31,
    20091


92,043



339,493



114,929



254,992



801,457Depreciation


28,125



79,970



14,919



21,548



144,562Impairment charges


6,673



1,178



500



212



8,563Disposals


(1,328
)


(71,809
)


(1,045
)


(1,696
)


(75,878
)Effect of exchange rates


1,996



9,194



438



2,324



13,952Balance, December 31, 2010


127,509



358,026



129,741



277,380



892,656Carrying amountDecember 31,
    20091


390,190



193,641



40,037



31,492



655,360December 31, 2010


399,346



251,227



55,894



38,864



745,331   1
    As of January 1, 2010 ASML
    adopted ASC 810 Amendments to FIN 46(R)
    which resulted in the consolidation of the VIE that owns
    ASMLs headquarters in Veldhoven, the Netherlands. The
    comparative figures for 2009 have been adjusted to reflect this
    change in accounting policy.           ASML ANNUAL REPORT 2010
 F-24




---



##### Table of Contents



Variable Interest
    Entity
               ASML ANNUAL REPORT 2010
 F-25




---



##### Table of Contents



12. Accrued and
    other liabilities
   As of December 31

2009


2010(in thousands)

EUR


EURDeferred revenue


219,378



543,145Costs to be paid


208,684



270,836Deposits from customers






150,000Down payments from customers


274,074



675,636Personnel related items


114,255



177,025Derivative instruments


17,471



34,898Standard warranty reserve


23,208



37,965Other


4,650



2,314Accrued and other liabilities


861,720



1,891,819Less: long-term portion of accrued and other liabilities


44,359



373,0701Short-term portion of accrued and other liabilities


817,361



1,518,749   1
    The main part of the non current
    portion of accrued and other liabilities relates to down
    payments received from customers regarding 2012 shipments of
    high-volume EUV systems.                       As of December 31

2009


2010(in thousands)

EUR


EURBalance, January 1


35,225



23,208Additions of the year


15,047



46,467Utilization of the reserve


(19,360
)


(14,325
)Release of the reserve


(7,666
)


(18,480
)Effect of exchange rates


(38
)


1,095Standard warranty reserve


23,208



37,965      ASML ANNUAL REPORT 2010
 F-26




---



##### Table of Contents



Year ended December 31

2008(in thousands, except per share data)

EUR


%Income from operations


33,409



11.6%Net income


24,890



7.7%Basic net income per ordinary share


0.06



8.0%Diluted net income per ordinary share


0.06



8.1%    13.
    Provisions
   Employee contract


Lease contracttermination benefits


termination costs


Total(in thousands)

EUR


EUR


EURBalance, January 1, 2009


2,265



17,908



20,173Utilization of the provision


(2,244
)


(2,747
)


(4,991
)Unwinding of discount






136



136Effect of exchange rates


(21
)


(99
)


(120
)Balance, December 31, 2009






15,198



15,198Utilization of the provision






(2,576
)


(2,576
)Unwinding of discount






305



305Effect of exchange rates






1,134



1,134Balance, December 31, 2010






14,061



14,061Non-current portion of provisionsDecember 31, 2009






12,694



12,694December 31, 2010






11,811



11,811       14. Long-term
    debt
   As of December 31

2009


2010(in thousands)

EUR


EUR5.75 percent Eurobond, carrying amount


663,088



674,835Variable Interest Entity


36,654



35,225Other


14



Long-term debt


699,756



710,060   ASML ANNUAL REPORT 2010
 F-27




---



##### Table of Contents



(in thousands)

EUR2011


1,4292012


1,4292013


1,4292014


1,4292015


1,429Thereafter


628,080Long-term debt


635,225Less: current portion of long-term debt


1,429Non-current portion of long-term debt


633,796    Eurobond
   As of December 31

2009


2010(in thousands)

EUR


EUR5.75 percent EurobondPrincipal amount


600,000



600,000Fair value interest rate
    swaps1


63,088



74,835Carrying amount


663,088



674,835   1
    The fair value of the interest rate
    swaps excludes accrued interest.        2009








2010Principal


Carrying





Principal


CarryingAs of December 31

Amount


Amount


Fair
    Value1


Amount


Amount


Fair
    Value1(in thousands)

EUR


EUR


EUR


EUR


EUR


EUR5.75 percent Eurobond


600,000



663,088



599,232



600,000



674,835



631,452   1
    Source: Bloomberg Finance LP      Variable interest
    entity
   ASML ANNUAL REPORT 2010
 F-28




---



##### Table of Contents



Lines of
    credit
       15. Commitments,
    contingencies and guarantees
    Tabular
    Disclosure of Contractual Obligations
   Less than


1-3


3-5


After 5Payments due by period

Total


1 year


years


years


years(in thousands)

EUR


EUR


EUR


EUR


EURLong Term Debt Obligations, including
    interest
    expense1


951,560



35,929



71,859



71,859



771,913Deposits from customers


150,000



150,000











Operating Lease Obligations


106,671



30,088



40,188



22,802



13,593Purchase Obligations


2,098,432



2,003,321



94,942



169



Unrecognized Tax Benefits


162,066



29,956



30,853



40,062



61,195Contractual Obligations


3,468,729



2,249,294



237,842



134,892



846,701   1
    See Note 14 for the amounts
    excluding interest expense.        ASML ANNUAL REPORT 2010
 F-29




---



##### Table of Contents



Less than


1-3


3-5


After 5Purchase options due by period

Total


1 year


years


years


years(in thousands)

EUR


EUR


EUR


EUR


EURPurchase options


31,232







8,250



8,999



13,983          16. Employee
    benefits
   Deferred
    compensation plans
       Pension
    plans
      ASML ANNUAL REPORT 2010
 F-30




---



##### Table of Contents



Year ended December 31

2008


2009


2010(in thousands)

EUR


EUR


EURPension plan based on multi-employer union plan


30,579



30,930



29,643Pension plans based on defined contribution


8,466



8,895



10,950Pension costs


39,045



39,825



40,593    Bonus
    plan
   Year ended December 31

2008


2009


2010(in thousands)

EUR


EUR


EURBonus expenses


7,756



9,167



9,694      Year ended December 31

2008


2009


2010(in thousands)

EUR


EUR


EURBonus expenses


5,031



5,222



1,165    Profit-sharing
    plan
   ASML ANNUAL REPORT 2010
 F-31




---



##### Table of Contents



Share-based
    payments
         Weighted averageNumber of


exercise price peroptions


ordinary share (EUR)Outstanding, January 1, 2008


15,036,599



20.90Granted


1,151,203



15.76Exercised


(1,119,426
)


12.03Forfeited


(984,832
)


11.99Expired


(2,008,620
)


17.02Outstanding, December 31, 2008


12,074,924



22.57Granted


368,752



15.67Exercised


(1,014,287
)


10.73Forfeited


(197,346
)


19.56Expired






Transfer to/from Board of
    Management1


79,536



23.40Outstanding, December 31, 2009


11,311,579



23.47Granted


55,565



23.37Exercised


(2,263,276
)


11.22Forfeited


(60,376
)


18.53Expired


(60,067
)


15.38Outstanding, December 31, 2010


8,983,425



26.66Exercisable, December 31, 2010


8,161,139



27.66Exercisable, December 31, 2009


10,264,985



24.06Exercisable, December 31, 2008


9,717,891



24.32   1
    In 2009, as a result of a change in
    the Board of Management 79,536 stock options were transferred
    between employee benefits and Board of Management remuneration.           Number





Weighted average


Weighted averageoustanding





remaining


exercise price ofRange of exercise

December 31,


Number exercisable


contractual life of


oustanding optionsprices (EUR)

2010


December 31, 2010


outstanding options (years)


(EUR)0.15 - 7.94


325,482



288,516



4.56



1.228.17 - 12.62


2,894,858



2,874,158



4.38



11.4612.75 - 19.13


1,518,478



1,003,914



6.03



16.8119.45 - 29.18


653,677



403,621



7.28



23.4129.65 - 44.48


21,000



21,000



1.07



36.8945.02 - 67.53


3,569,930



3,569,930



1.07



46.02Total


8,983,425



8,161,139



3.56



26.66   ASML ANNUAL REPORT 2010
 F-32




---



##### Table of Contents



Year ended December 31(in thousands, except for contractual term)

2008


2009


2010Aggregate intrinsic value of stock options exercised (EUR)


5,894



10,140



30,546Total fair value at vesting date of shares vested during the
    year (EUR)


4,288



8,465



9,469Aggregate remaining contractual term of currently exercisable
    options (years)


4.83



4.28



3.14Aggregate intrinsic value of exercisable stock options (EUR)


11,671



77,813



71,524Aggregate intrinsic value of outstanding stock options (EUR)


15,491



84,554



81,402      Conditionally














Conditionallyoutstanding


Number of


Share








outstandingshares at


conditionally


price at








shares at


End ofJanuary 1,


shares


grant


Forfeited/





December 31,


vestingShare plan

Year


2010


granted


date (EUR)


expired


Vested


2010


periodEmployee plan


2007



42,570







24.26



(1,854
)


(40,716
)






10/19/2010Brion stock plan


2007



110,675







17.50







(110,675
)






03/07/2010Brion performance stock plan


2007



40,822







23.12



(2,000
)


(38,822
)






12/31/2010New hire performance stock plan


2007



8,182







22.00



(2,727
)


(5,455
)






12/31/2010Senior management
    plan1


2007



31,164







17.80



(5,662
)


(25,502
)






10/19/2010Employee plan


2008



34,622







14.87



(1,180
)






33,442



07/18/2011Brion performance stock plan


2008



134,752







12.95



(6,604
)


(64,074
)


64,074



12/31/2011New hire performance stock plan January


2008



4,362







17.60



(727
)


(1,454
)


2,181



01/19/2011Incentive share plan January


2008



2,500







17.60











2,500



01/19/2011New hire performance stock plan July


2008



22,698







14.83



(2,523
)


(5,044
)


15,131



12/31/2011New hire performance stock plan October


2008



7,875







11.43







(2,625
)


5,250



10/17/2011Senior management plan


2008



91,104







13.05



(9,257
)






81,847



07/18/2011Employee plan


2009



93,150







24.14



(1,200
)






91,950



10/16/2012Senior management plan


2009



225,875







19.85



(13,475
)






212,400



10/16/2012New hire performance stock plan January


2010







27,066



23.38



(4,116
)






22,950



01/22/2013New hire performance stock plan April


2010







6,595



25.59











6,595



04/16/2013Brion performance stock plan


2010







79,395



25.59











79,395



04/16/2013Employee plan


2010







118,100



23.37











118,100



10/15/2013New hire performance stock plan October


2010







9,042



23.37











9,042



10/15/2013Total






850,351



240,198







(51,325
)


(294,367
)


744,857   1
    In 2009, as a result of a change in
    the Board of Management shares were transferred between employee
    benefits and Board of Management remuneration.        ASML ANNUAL REPORT 2010
 F-33




---



##### Table of Contents



Year ended December 31

2008


2009


2010Weighted average share price (in EUR)


12.5



16.7



24.1Volatility (in percentage)


54.5



51.7



36.4Expected life (in years)


4.9



4.6



4.6Risk free interest rate


4.4



3.2



2.5Expected dividend yield (in EUR)


1.15



1.06



1.06Forfeiture
    rate1










   1
    For of the three years ended
    December 31, 2010, forfeitures are estimated to be nil.      Share-based
    payment plans
    Senior management
    plan
       Employee plan
    Employee Purchase
    Plan
 and/or
   New hire
    performance stock plan
    Brion stock
    plan
   ASML ANNUAL REPORT 2010
 F-34




---



##### Table of Contents



Brion performance
    stock plan
    Brion stock
    option plan
    Stock Option
    Extension Plans and Financing
          Policy for
    issuing shares upon exercise
    17. Legal
    contingencies
 and/or
        ASML ANNUAL REPORT 2010
 F-35




---



##### Table of Contents



18. Income
    taxes
   Year Ended December 31

2008


2009


2010(in thousands)

EUR


EUR


EURCurrent tax


50,857



(29,970
)


(180,613
)Deferred tax


(38,131
)


50,595



(40,090
)Total


12,726



20,625



(220,703
)         Year Ended December 31

2008





2009





2010(in thousands)

EUR


%


EUR


%


EUR


%Income (loss) from operations before income taxes


309,644



100.0



(171,550
)


100.0



1,242,523



100.0Income tax (provision) benefit based on
    the Companys domestic rate


(78,959
)


25.5



43,745



25.5



(316,843
)


25.5Effects of tax rates in foreign jurisdictions


26,764



(8.6
)


18,482



10.8



35,865



(2.9
)Adjustments in respect of changes inthe applicable tax rate


















66,312



(5.3
)Adjustments in respect of prior years current taxes


80,390



(26.0
)


(36,267
)


(21.2
)


25,648



(2.1
)Other credits and non-taxable items


(15,469
)


5.0



(5,335
)


(3.1
)


(31,685
)


2.6(Provision for) benefit from income taxes shown in the
    consolidated statements of operations


12,726



(4.1
)


20,625



12.0



(220,703
)


17.8    Income tax
    (Provision) benefit based on the Companys domestic
    rate
    Effects of tax
    rates in foreign jurisdictions
    Adjustments in
    respect of changes in the applicable tax rate
      ASML ANNUAL REPORT 2010
 F-36




---



##### Table of Contents



Adjustments in
    respect of prior years current taxes
          Other credits and
    non-taxable items
    Income taxes
    recognized directly in equity
   Income tax recognized in equity

2008


2009


2010(in thousands)

EUR


EUR


EURCurrent taxDerivative financial
    instruments1


(16,081
)






8,262Share-based payments


(2,144
)






(106
)Deferred taxDerivative financial
    instruments1






813



Share-based payments






(1,954
)


Total income tax recognized in equity


(18,225
)


(1,141
)


8,156   1
    Recognized directly in Other
    Comprehensive Income.   Liability for
    unrecognized tax benefits and deferred taxes
   As of December 31

2009


2010(in thousands)

EUR


EURLiability for unrecognized tax benefits


(133,270
)


(162,066
)Deferred tax position


194,486



193,587Total


61,216



31,521    Liability for
    unrecognized tax benefits
      ASML ANNUAL REPORT 2010
 F-37




---



##### Table of Contents



As of December 31

2009


2010(in millions)

EUR


EURBalance, January 1


124.2



133.3Gross increases  tax positions in prior period


6.4



8.6Gross decreases  tax positions in prior period


(1.8
)


(1.1
)Gross increases  tax positions in current period


10.6



24.7Settlements


(4.3
)


(3.4
)Lapse of statute of limitations


(1.8
)


Total liability for unrecognized tax benefits


133.3



162.1Less: current portion of liability for unrecognized tax benefits






18.2Non-current portion of liability for unrecognized tax
    benefits


133.3



143.9             Deferred tax
    position
   Changes in deferred tax assets and liabilities

2009


2010(in thousands)

EUR


EURBalance, January 1


134,268



194,486Income statement


59,639



(11,943
)Equity


1,141



Exchange differences


(562
)


11,044Balance, December 31


194,486



193,587   ASML ANNUAL REPORT 2010
 F-38




---



##### Table of Contents



As of December 31

2009


2010(in thousands)

EUR


EURDeferred tax assets  current


119,404



134,429Deferred tax assets  non-current


133,263



71,008Total deferred tax assets


252,667



205,437Deferred tax liabilities  current


(3,047
)


(65
)Deferred tax liabilities  non-current


(55,134
)


(11,785
)Total deferred tax liabilities


(58,181
)


(11,850
)Total


194,486



193,587    work-in-process
     Deferred tax assetsComposition of




Income





Exchangetemporary differences

January 1, 2009


statement


Equity


differences


December 31, 2009(in thousands)

EUR


EUR


EUR


EUR


EURTax effect carry-forward losses


57,832



48,977



1,141



(890
)


107,060Inventories


33,298



2,456







3



35,757Capitalized research and development expenditures


43,522



(10,240
)






(34
)


33,248Bilateral advance pricing
    agreement1


20,856



(6,379
)






(87
)


14,390Fixed assets


5,840



7,821







(271
)


13,390Provisions


16,406



(4,018
)






34



12,422Restructuring and impairment


12,840



(5,248
)






412



8,004Share-based payments


3,445



1,426







(74
)


4,797Deferred revenue


6,107



(1,858
)






(14
)


4,235Installation and warranty reserve


4,718



(1,041
)






68



3,745Alternative minimum tax
    credits2


3,016



(151
)






31



2,896Other temporary differences


12,033



567







123



12,723Total


219,913



32,312



1,141



(699
)


252,667   1
    The Bilateral advance pricing
    agreement relates to intellectual property which is capitalized
    from a tax perspective resulting in a temporary difference.2
    Alternative minimum tax credits
    relate to prepaid United States taxes which are credited against
    future taxable profits after the carry-forward losses used.  Deferred tax liabilitiesComposition of




Income





Exchangetemporary differences

January 1, 2009


statement


Equity


differences


December 31, 2009(in thousands)

EUR


EUR


EUR


EUR


EURTemporary depreciation
    investments1


(72,587
)


36,294











(36,293
)Fixed assets






(7,508
)






154



(7,354
)Brion intellectual property


(8,862
)


1,953







21



(6,888
)Transfer pricing






(2,878
)






(108
)


(2,986
)Borrowing costs


(2,020
)


(696
)










(2,716
)Other temporary differences


(2,176
)


162







70



(1,944
)Total


(85,645
)


27,327







137



(58,181
)   1
    The Company has temporarily
    depreciated part of its investments in its United States group
    companies which has been deducted from the taxable base in the
    Netherlands.  ASML ANNUAL REPORT 2010
 F-39




---



##### Table of Contents



Deferred tax assetsComposition of




Income





Exchangetemporary differences

January 1, 2010


statement


Equity


differences


December 31, 2010(in thousands)

EUR


EUR


EUR


EUR


EURTax effect carry-forward losses


107,060



(84,794
)






5,490



27,756Inventories


35,757



34,155







1,212



71,124Capitalized research and development expenditures


33,248



(7,504
)






1,495



27,239Bilateral advance pricing
    agreement1


14,390



(6,778
)






381



7,993Fixed assets


13,390



(9,244
)






240



4,386Provisions


12,422



8,671







735



21,828Restructuring and impairment


8,004



(2,572
)






642



6,074Share-based payments


4,797



(3,488
)






369



1,678Deferred revenue


4,235



6,475







180



10,890Installation and warranty reserve


3,745



4,137







210



8,092Alternative minimum tax
    credits2


2,896



1,588







174



4,658Other temporary differences


12,723



(916
)






1,912



13,719Total


252,667



(60,270
)






13,040



205,437   1
    The Bilateral advance pricing
    agreement relates to intellectual property which is capitalized
    from a tax perspective resulting in a temporary difference.2
    Alternative minimum tax credits
    relate to prepaid United States taxes which are credited against
    future taxable profits after the carry-forward losses used.  Deferred tax liabilitiesComposition of




Income





Exchange


December 31,temporary differences

January 1, 2010


statement


Equity


differences


2010(in thousands)

EUR


EUR


EUR


EUR


EURTemporary depreciation
    investments1


(36,293
)


36,293











Fixed assets


(7,354
)


(1,741
)






(566
)


(9,661
)Brion intellectual property


(6,888
)


7,981







(1,093
)


Transfer pricing


(2,986
)


3,237







(251
)


Borrowing costs


(2,716
)


1,485











(1,231
)Other temporary differences


(1,944
)


1,072







(86
)


(958
)Total


(58,181
)


48,327







(1,996
)


(11,850
)   1
    The Company has temporarily
    depreciated part of its investments in its United States group
    companies which has been deducted from the taxable base in the
    Netherlands.   Tax effect
    carry-forward losses
      ASML ANNUAL REPORT 2010
 F-40




---



##### Table of Contents



19. Segment
    disclosure
         Year Ended December 31

2008


2009


2010(in thousands)

EUR


EUR


EURNew systems


2,346,337



993,260



3,704,290Used systems


170,425



181,598



190,452Net system sales


2,516,762



1,174,858



3,894,742    ramp-ups.
     Year Ended December 31

Net sales


Identifiable assets(in thousands)

EUR


EUR2008Japan


437,202



239,746Korea


909,941



12,204Singapore


72,245



5,174Taiwan


361,808



62,509Rest of Asia


252,713



374,285Europe


280,040



2,788,0911United States


639,729



337,324Total


2,953,678



3,819,3332009Japan


41,075



103,399Korea


377,677



24,931Singapore


155,825



7,987Taiwan


440,222



63,502Rest of Asia


144,004



398,959Europe


68,652



2,609,3191United States


368,608



406,464Total


1,596,063



3,614,5612010Japan


396,748



345,160Korea


1,396,028



31,859Singapore


215,357



17,189Taiwan


1,380,400



77,125Rest of Asia


239,914



1,749,879Europe


203,548



3,382,117United States


675,943



422,092Total


4,507,938



6,025,421   1
    As of January 1, 2010 ASML
    adopted ASC 810 Amendments to FIN 46(R)
    which resulted in the consolidation of the VIE that owns
    ASMLs headquarters in Veldhoven, the Netherlands. The
    comparative figures for 2008 and 2009 have been adjusted to
    reflect this change in accounting policy. See Note 1 and
    Note 11.  ASML ANNUAL REPORT 2010
 F-41




---



##### Table of Contents



20. Board of
    Management and Supervisory Board remuneration
                Total direct
    compensation, pension and other benefits
   ASML ANNUAL REPORT 2010
 F-42




---



##### Table of Contents



TotalFixed


Short-term (variable)


Long-term (variable)


Remuneration


OtherOther benefitsBase


STI


Option











and expenseFinancial


salary


(Cash)1


awards2


LTI (share
    awards)3


Total5


Pension6


reimbursement7Year


EUR


EUR


EUR


EUR


EUR


EUR


EURE. Meurice


2010



757,000



566,236



42,648



935,617
4


2,301,501



136,697



132,6302009



735,000



507,150



466,164



1,042,576



2,750,890



91,950



141,3772008



735,000



414,569



279,316



1,194,544



2,623,429



91,982



129,845P.T.F.M. Wennink


2010



469,000



280,650



26,401



579,321
4


1,355,372



84,229



43,6272009



455,000



251,160



288,578



646,055



1,640,793



56,317



44,8862008



455,000



205,311



172,929



747,238



1,580,478



56,350



49,209M.A. van den Brink


2010



497,000



297,405



28,025



617,004
4


1,439,434



90,388



44,8172009



483,000



266,616



306,336



681,179



1,737,131



59,880



44,9922008



483,000



217,945



183,276



785,809



1,670,030



59,913



43,686F.J. van Hout


2010



412,000



246,541



23,209



471,700



1,153,450



65,300



34,5492009



400,000



220,800



241,522



123,111



985,433



40,800



35,1992008



























F.
    Schneider-Maunoury8


2010



400,000



239,360







326,947



966,307



55,011



34,7882009



33,333



58,095











91,428



4,736



3,1632008



























   1
    Actual STI (cash) chargeable to the
    company in the financial year (i.e. STI relating to performance
    in the current year but paid out in the next financial year).
    The accrued STI (cash) with respect to 2009 were paid out after
    ASML achieved a cumulative income from operations of at least
    100 million Euro in two consecutive quarters after
    January 1, 2010. This was achieved on the basis of the
    first and second quarter results for 2010. The 2008 short-term
    incentives (cash) for Mr. Meurice, Mr. Wennink and Mr.
    van den Brink were partly paid in unconditional shares on
    February 3, 2009.2
    The remuneration reported as part
    of the option awards is based on costs incurred under
    U.S. GAAP. The costs of the option awards are based on the
    actual vested number of option awards multiplied by the fair
    value of the option awards at grant date and are recorded in the
    statements of operations on a straight line basis over the
    vesting period. The 2009 number of option awards that actually
    vested was 100 percent, whereas the 2008 number of option
    awards that actually vested was 50 percent.3
    The remuneration reported as part
    of the LTI (share awards) is based on costs incurred under
    U.S. GAAP. The costs of share awards are charged to the
    statements of operations over the three year vesting period
    based on the maximum achievable number of share awards.
    Therefore the costs for the financial year 2010 include costs of
    the Board of Management performance share plan 2010, 2009 and
    2008. Furthermore, the difference between the amount based on
    the maximum achievable number of share awards and the amount
    based on the actual number of share awards that vest, is
    released to the statements of operations in the financial year
    in which the share awards vest.4
    The remuneration reported as part
    of the LTI (share awards) for the year 2010 includes a
    correction for the Board of Management performance share plan
    2007 based on the actual number of share awards vested in 2010.
    The correction for Mr. Meurice, Mr. Wennink and for
    Mr. van den Brink amounts to EUR −296,287,
    EUR −183,612 and EUR −191,972,
    respectively.5
    This total reflects base salary,
    STI (cash), option awards and LTI (share awards).6
    The pension arrangement has been
    adjusted upwards to match common market practice as from 2010.
    Furthermore, since the pension arrangement for members of the
    Board of Management is a defined contribution plan, the Company
    does not have additional pension obligations beyond the annual
    premium contribution. As per 2010, the employee contribution to
    the pension plan is 4 percent of the pension base.7
    Other benefits and expense
    reimbursement include housing costs, company car costs, social
    security costs, health and disability insurance costs and
    representation allowances. As of 2009, all other benefits and
    expense reimbursement are gross amounts. Comparative figures for
    the year 2008 have been adjusted.8
    For 2009, the remuneration for
    Mr. Schneider-Maunoury regards only the month December.   Short-term
    incentive
    Performance Stock
    Options
 (lock-up
  ASML ANNUAL REPORT 2010
 F-43




---



##### Table of Contents



Number of


Fair value





Number ofoptions


at grant





optionsat grant


date1





at vestingGrant date


Status


Full control


date


(EUR)


Vesting date


dateE. Meurice


02/02/2009



Unconditional



No



84,895



5.73



02/02/2010



84,89502/04/2008



Unconditional



No



84,895



6.41



02/04/2009



42,44801/17/2007



Unconditional



Yes



100,154



6.74



01/17/2008



95,146P.T.F.M. Wennink


02/02/2009



Unconditional



No



52,554



5.73



02/02/2010



52,55402/04/2008



Unconditional



No



52,554



6.41



02/04/2009



26,27701/17/2007



Unconditional



Yes



62,067



6.74



01/17/2008



58,964M.A. van den Brink


02/02/2009



Unconditional



No



55,788



5.73



02/02/2010



55,78802/04/2008



Unconditional



No



55,788



6.41



02/04/2009



27,89401/17/2007



Unconditional



Yes



64,888



6.74



01/17/2008



61,644F.J. van
    Hout2


02/02/2009



Unconditional



No



46,201



5.73



02/02/2010



46,20107/18/2008



Unconditional



No



8,000



5.45



07/18/2011



8,000F. Schneider-Maunoury


























   1
    The fair value of the option award
    as of the grant date2
    The options granted to Mr. Van
    Hout on and before October 17, 2008, relate to his
    pre-Board of Management period at ASML  ASML ANNUAL REPORT 2010
 F-44




---



##### Table of Contents



Share





Free


With lock-upprice on





tradable


restriction


ExerciseJan. 1,


Exercised


exercise date


Vested


(Dec. 31,


(Dec. 31,


price


Expiration2010


during 2010


(EUR)


during 2010


2010)


2010)


(EUR)


dateE. Meurice


125,000















125,000







10.62



10/15/201457,770















57,770







11.53



01/19/201512,500















12,500







11.52



01/21/201588,371















88,371







17.90



01/18/201695,146















95,146







20.39



01/17/201742,448



















42,448



17.20



02/04/2018











84,895







84,895



12.39



02/02/2019P.T.F.M. Wennink


31,500















31,500







58.00



01/20/201232,379



12,379



23.08







20,000







11.53



01/19/201556,236















56,236







17.90



01/18/201658,964















58,964







20.39



01/17/201726,277



















26,277



17.20



02/04/2018











52,554







52,554



12.39



02/02/2019M.A. van den Brink


31,500















31,500







58.00



01/20/201259,098



19,098



23.08







40,000







17.90



01/18/201661,644















61,644







20.39



01/17/201727,894



















27,894



17.20



02/04/2018











55,788







55,788



12.39



02/02/2019F.J. van Hout


4,100



4,100



23.08















7.88



01/20/201315,000















15,000







10.11



07/18/20131,365



1,365



23.08















10.11



07/18/201310,000















10,000







17.34



01/19/201420,000















20,000







12.02



07/16/20149,000















9,000







11.56



04/15/201514,000















14,000







17.90



10/20/20161,388















1,388







24.26



10/19/20173,987















3,987







11.43



10/17/2018











46,201







46,201



12.39



02/02/2019F. Schneider-Maunoury






























    Long-term
    incentive
          lock-up
  ASML ANNUAL REPORT 2010
 F-45




---



##### Table of Contents



Number of


Fair value at





Number ofshares at


grant
    date1


Vesting


sharesGrant date


Status


Full control


grant date


(EUR)


date


at vesting dateE. Meurice


02/01/2010



Conditional



No



88,732



22.93



02/01/2013



02/02/2009



Conditional



No



57,002



13.05



02/02/2012



02/04/2008



Conditional



No



57,002



18.18



02/04/2011



01/17/2007



Unconditional



No



66,338



20.39



01/17/2010



51,80701/18/2006



Unconditional



No



72,136



17.90



01/18/2009



72,13601/19/2005



Unconditional



Yes



36,972



11.53



01/19/2008



36,972P.T.F.M. Wennink


02/01/2010



Conditional



No



54,974



22.93



02/01/2013



02/02/2009



Conditional



No



35,287



13.05



02/02/2012



02/04/2008



Conditional



No



35,287



18.18



02/04/2011



01/17/2007



Unconditional



No



41,111



20.39



01/17/2010



32,10601/18/2006



Unconditional



No



45,905



17.90



01/18/2009



45,90501/19/2005



Unconditional



Yes



20,721



11.53



01/19/2008



20,721M.A. van den Brink


02/01/2010



Conditional



No



58,256



22.93



02/01/2013



02/02/2009



Conditional



No



37,458



13.05



02/02/2012



02/04/2008



Conditional



No



37,458



18.18



02/04/2011



01/17/2007



Unconditional



No



42,980



20.39



01/17/2010



33,56501/18/2006



Unconditional



No



48,241



17.90



01/18/2009



48,24101/19/2005



Unconditional



Yes



25,902



11.53



01/19/2008



25,902F.J. van
    Hout2


02/01/2010



Conditional



No



48,293



22.93



02/01/2013



02/02/2009



Conditional



No



31,021



13.05



02/02/2012



07/18/2008



Conditional



No



4,000



17.20



07/18/2011



10/19/2007



Unconditional



Yes



3,334



20.39



10/19/2010



1,667F. Schneider-Maunoury


02/01/2010



Conditional



No



46,886



22.93



02/01/2013



   1
    The fair value of the shares as of
    the grant date.2
    The shares granted to Mr. Van
    Hout on and before October 17, 2008, relate to his
    pre-Board of Management period at ASML. No
    lock-up
    period is applicable for the shares granted to Mr. Van Hout
    in his pre-Board of Management period.   Pension
    Benefits
    Benefits upon
    termination of employment
  Term of
    appointment/employment
    Severance
    agreement
         ASML ANNUAL REPORT 2010
 F-46




---



##### Table of Contents



Change in
    control
    Supervisory
    Board
      Selection and


TechnologySupervisory


Audit


Remuneration


Nomination


and StrategyYear ended December 31

2010


Board


Committee


Committee


Committee


Committee


Other1Arthur P.M. van der Poel


80,000



55,000



10,000







7,500



7,500



Jos W.B. Westerburgen


60,000



40,000







10,000



10,000







OB Bilous


95,000



70,000











7,500



7,500



10,000Frits W. Fröhlich


55,000



40,000



15,000















Hendrika (Ieke) C.J. van den Burg


47,500



40,000







7,500











William T. Siegle


80,000



70,000















10,000



Pauline F.M. van der Meer Mohr


47,500



40,000







7,500











Wolfgang H. Ziebart


57,500



40,000



10,000











7,500



Total


522,500



395,000



35,000



25,000



25,000



32,500



10,000   Selection and


TechnologySupervisory


Audit


Remuneration


Nomination


and StrategyYear ended December 31

2009


Board


Committee


Committee


Committee


Committee


Other1Arthur P.M. van der Poel


80,000



55,000



10,000







7,500



7,500



Jos W.B. Westerburgen


60,000



40,000







10,000



10,000







OB Bilous


95,000



70,000











7,500



7,500



10,000Frits W. Fröhlich


55,000



40,000



15,000















Hendrika (Ieke) C.J. van den Burg


47,500



40,000







7,500











William T. Siegle


79,375



69,375















10,000



Pauline F.M. van der Meer
    Mohr2,3


47,500



40,000







7,500











Wolfgang H.
    Ziebart2


43,125



25,625



10,000











7,500



J.A.
    Dekker4


15,000











7,500







7,500



Total


522,500



380,000



35,000



32,500



25,000



40,000



10,000   1
    To compensate for certain
    obligations ASML has towards the U.S. government as a
    result of the merger with SVG in 2001, one U.S. member
    receives an additional EUR 10,000 to fulfill these
    obligations.2
    Membership started March 26,
    2009.3
    The amount paid to Ms. P. van
    der Meer Mohr in 2009 consists of an amount paid to Ms. P.
    van der Meer Mohr as observer to the Supervisory Board prior to
    her appointment, and an amount for her membership of the
    Supervisory Board and Remuneration Committee.4
    Membership ended March 26,
    2009.     ASML ANNUAL REPORT 2010
 F-47




---



##### Table of Contents



and/or
   21. Selected
    operating expenses and additional information
   Year ended December 31

2008


2009


2010(in thousands)

EUR


EUR


EURWages and salaries


477,374



436,888



551,683Social security expenses


37,877



38,533



42,468Pension and retirement expenses


39,045



39,825



40,593Share-based payments


13,535



13,394



12,109Personnel expenses


567,831



528,640



646,853      As of December 31

2008


2009


2010Customer Support


2,389



1,910



2,236SG&A


667



679



727Industrial Engineering






277



398Manufacturing & Logistics


1,731



1,639



2,475R&D


3,010



2,813



3,225Sourcing


462



367



125Quality & Process Improvement










59Total employees (in FTEs)


8,259



7,685



9,245Less: Temporary employees (in FTEs)


1,329



1,137



2,061Payroll employees (in FTEs)


6,930



6,548



7,184       22. Research and
    development costs
    23. Interest
    income and expense
    24. Vulnerability
    due to certain concentrations
   ASML ANNUAL REPORT 2010
 F-48




---



##### Table of Contents



25. Capital
    stock
   Share
    capital
       Ordinary
    shares
 and/or and/or
         Cumulative
    preference shares
      ASML ANNUAL REPORT 2010
 F-49




---



##### Table of Contents



Dividend
    proposal
   ASML ANNUAL REPORT 2010
 F-50




---



##### Table of Contents



26. Purchases of
    Equity Securities by the Issuer and Affiliated
    Purchasers
   Total valueTotal Number


Maximum


of Sharesof Shares


Number of


Purchased asPurchased as


Shares That


Part of PubliclyAverage


Part of Publicly


May Yet be


AnnouncedTotal Number


price paid


Announced


Purchased


Plans orof Shares


per share


Plans or


Under the


Programs (inProgram

Period


purchased


(EUR)


Programs


Programs


EUR million)2006-2007 Share
    program


May 17-26, 2006



6,412,920



15.59



6,412,920



19,037,376



1002006-2007 Share
    program


June 7-30, 2006



13,517,078



15.81



19,929,998



5,520,298



3142006-2007 Share
    program


July 3-13, 2006



5,520,298



15.62



25,450,296







4002006-2007 Share
    program


October 12, 2006



14,934,843



18.55



14,934,843







2772006-2007 Share
    program


February 14-23, 2007



8,000,000



19.53



8,000,000







156Capital repayment program 2007


September - October 2007



55,093,409



18.36



55,093,409







1,0122007-2008 Share
    program


November 14-26, 2007



9,000,000



22.62



9,000,000



5,000,000



2042007-2008 Share
    program


January 17-22, 2008



5,000,000



17.52



14,000,000







292    Authorization of
    share repurchases
    27. Subsequent
    Events
   
               ASML ANNUAL REPORT 2010
 F-51




---



##### Table of Contents



Report
    of Independent Registered Public Accounting Firm





To the Supervisory Board and Shareholders of ASML Holding N.V.:



We have audited the accompanying consolidated balance sheets of
    ASML Holding N.V. and subsidiaries (collectively, the
    Company) as of December 31, 2010 and 2009, and
    the related consolidated statements of operations, comprehensive
    income, shareholders equity and cash flows for each of the
    three years in the period ended December 31, 2010 (all
    expressed in euros). We also have audited the Companys
    internal control over financial reporting as of
    December 31, 2010, based on criteria established in
    Internal Control  Integrated Framework issued by the
    Committee of Sponsoring Organizations of the Treadway
    Commission. The Companys management is responsible for
    these financial statements, for maintaining effective internal
    control over financial reporting, and for its assessment of the
    effectiveness of internal control over financial reporting,
    included in the accompanying Managements Report on
    Internal Control over Financial Reporting. Our responsibility is
    to express an opinion on these financial statements and an
    opinion on the Companys internal control over financial
    reporting based on our audits.



We conducted our audits in accordance with the standards of the
    Public Company Accounting Oversight Board (United States). Those
    standards require that we plan and perform the audit to obtain
    reasonable assurance about whether the financial statements are
    free of material misstatement and whether effective internal
    control over financial reporting was maintained in all material
    respects. Our audit of the financial statements included
    examining, on a test basis, evidence supporting the amounts and
    disclosures in the financial statements, assessing the
    accounting principles used and significant estimates made by
    management, and evaluating the overall financial statement
    presentation. Our audit of internal control over financial
    reporting included obtaining an understanding of internal
    control over financial reporting, assessing the risk that a
    material weakness exists, and testing and evaluating the design
    and operating effectiveness of internal control based on the
    assessed risk. Our audits also included performing such other
    procedures as we considered necessary in the circumstances. We
    believe that our audits provide a reasonable basis for our
    opinions.



A companys internal control over financial reporting is a
    process designed by, or under the supervision of, the
    companys principal executive and principal financial
    officers, or persons performing similar functions, and effected
    by the companys board of directors, management, and other
    personnel to provide reasonable assurance regarding the
    reliability of financial reporting and the preparation of
    financial statements for external purposes in accordance with
    generally accepted accounting principles. A companys
    internal control over financial reporting includes those
    policies and procedures that (1) pertain to the maintenance
    of records that, in reasonable detail, accurately and fairly
    reflect the transactions and dispositions of the assets of the
    company; (2) provide reasonable assurance that transactions
    are recorded as necessary to permit preparation of financial
    statements in accordance with generally accepted accounting
    principles, and that receipts and expenditures of the company
    are being made only in accordance with authorizations of
    management and directors of the company; and (3) provide
    reasonable assurance regarding prevention or timely detection of
    unauthorized acquisition, use, or disposition of the
    companys assets that could have a material effect on the
    financial statements.



Because of the inherent limitations of internal control over
    financial reporting, including the possibility of collusion or
    improper management override of controls, material misstatements
    due to error or fraud may not be prevented or detected on a
    timely basis. Also, projections of any evaluation of the
    effectiveness of the internal control over financial reporting
    to future periods are subject to the risk that the controls may
    become inadequate because of changes in conditions, or that the
    degree of compliance with the policies or procedures may
    deteriorate.



In our opinion, the consolidated financial statements referred
    to above present fairly, in all material respects, the financial
    position of ASML Holding N.V. and subsidiaries as of
    December 31, 2010 and 2009, and the results of their
    operations and their cash flows for each of the three years in
    the period ended December 31, 2010, in conformity with
    accounting principles generally accepted in the United States of
    America. Also, in our opinion, the Company maintained, in all
    material respects, effective internal control over financial
    reporting as of December 31, 2010, based on the criteria
    established in Internal Control  Integrated Framework
    issued by the Committee of Sponsoring Organizations of the
    Treadway Commission.



/s/  Deloitte
    Accountants B.V.



Deloitte Accountants B.V.

Eindhoven, The Netherlands

February 14, 2011



ASML ANNUAL REPORT 2010

F-52




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##### Table of Contents



Exhibits
  ASML ANNUAL REPORT 2010




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##### Table of Contents



Exhibit Index
     Exhibit No.

Description1

Articles of Association of ASML Holding N.V. (English
    translation) (Incorporated by reference to Amendment No. 11 to
    the Registrants Registration Statement on
    Form 8-A/A,
    filed with the Commission on November 2, 2007)2.1

Fiscal Agency Agreement between ASML Holding N.V., Deutsche Bank
    AG, London Branch and Deutsche Bank Luxembourg S.A. relating to
    the Registrants 5.75 percent Notes due 2017
    (Incorporated by reference to the Registrants Annual
    Report for the year ended December 31, 2008)4.1

Agreement between ASM Lithography B.V. and Carl Zeiss, dated
    March 17, 2000 (Incorporated by reference to the
    Registrants Annual Report on
    Form 20-F
    for the fiscal year ended December 31, 2000) #4.2

Agreement between ASML Holding N.V. and Carl Zeiss, dated
    October 24, 2003 (Incorporated by reference to the
    Registrants Annual Report on
    Form 20-F
    for the year ended December 31, 2003) #4.3

Form of Indemnity Agreement between ASML Holding N.V. and
    members of its Board of Management (Incorporated by reference to
    the Registrants Annual Report on
    Form 20-F
    for the year ended December 31, 2003)4.4

Form of Indemnity Agreement between ASML Holding N.V. and
    members of its Supervisory Board (Incorporated by reference to
    the Registrants Annual Report on
    Form 20-F
    for the year ended December 31, 2003)4.5

Form of Employment Agreement for members of the Board of
    Management (Incorporated by reference to the Registrants
    Annual Report on
    Form 20-F
    for the fiscal year ended December 31, 2003)4.6

Nikon-ASML Patent Cross-License Agreement, dated
    December 10, 2004, between ASML Holding N.V. and Nikon
    Corporation (Incorporated by reference to the Registrants
    Annual Report on
    Form 20-F
    for the fiscal year ended December 31, 2004) #4.7

ASML/Zeiss Sublicense Agreement, 2004, dated December 10,
    2004, between Carl Zeiss SMT AG and ASML Holding N.V.
    (Incorporated by reference to the Registrants Annual
    Report on
    Form 20-F
    for the fiscal year ended December 31, 2004) #4.8

ASML New Hires and Incentive Stock Option Plan For Management
    (Version 2003) (Incorporated by reference to the
    Registrants Statement on
    Form S-8,
    filed with the Commission on September 2, 2003 (File
    No. 333-109154))4.9

ASML Incentive and New Hire Option Plan for Board of Management
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8,
    filed with the Commission on June 9, 2004 (File
    No. 333-116337))4.10

ASML Option Plan for Management of ASML Holding Group Companies
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on June 30, 2005 (file
    No. 333-126340))4.11

ASML Stock Option Plan for New Hire Options granted to Members
    of the Board of Management (Version April 2006) (Incorporated by
    reference to the Registrants Registration Statement on
    Form S-8
    filed with the Commission on August 7, 2006 (file
    No. 333-136362))4.12

ASML Stock Option Plan for Incentive or New Hire Options granted
    to Senior and Executive Management (Version April 2006)
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on August 7, 2006
    (file No. 333-136362))4.13

ASML Stock Option Plan for Incentive or New Hire Options granted
    to Senior and Executive Management (Version July 2006)
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on August 7, 2006
    (file No. 333-136362))4.14

ASML Stock Option Plan for Incentive or New Hire Options granted
    to Senior and Executive Management (Version October 2006)
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on August 7, 2006
    (file No. 333-136362))4.15

ASML Restricted Stock Plan (Incorporated by reference to the
    Registrants Registration Statement on
    Form S-8
    filed with the Commission on March 7, 2007 (file
    No. 333-141125))4.16

Brion Technologies, Inc., 2002 Stock Option Plan (as amended on
    March 25, 2005; March 24, 2006; and November 17,
    2006) (Incorporated by reference to the Registrants
    Registration Statement on
    Form S-8
    filed with the Commission on April 20, 2007
    (file No. 333-142254))4.17

ASML Stock Option Plan for Incentive or New Hire Options granted
    to Senior and Executive Management (Version January 2007)
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on July 5, 2007
    (file No. 333-144356))4.18

ASML Stock Option Plan for Incentive or New Hire Options granted
    to Senior and Executive Management (Version April 2007)
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on July 5, 2007
    (file No. 333-144356))4.19

ASML Stock Option Plan for Incentive or New Hire Options granted
    to Senior and Executive Management (Version July 2007)
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on July 5, 2007
    (file No. 333-144356))4.20

ASML Stock Option Plan for Incentive or New Hire Options granted
    to Senior and Executive Management (Version October 2007)
    (Incorporated by reference to the Registrants Registration
    Statement on
    Form S-8
    filed with the Commission on July 5, 2007
    (file No. 333-144356))4.21

ASML Performance Stock Plan for Members of the Board of
    Management (Version 1) (Incorporated by reference to the
    Registrants Registration Statement on
    Form S-8
    filed with the Commission on July 5, 2007 (file
    No. 333-144356))4.22

ASML Performance Stock Option Plan for Members of the Board of
    Management (Version 2) (Incorporated by reference to the
    Registrants Registration Statement on
    Form S-8
    filed with the Commission on July 5, 2007 (file
    No. 333-144356))4.23

ASML Stock Option Plan from Base Salary for Senior &
    Executive Management (Version October 2007) (Incorporated by
    reference to the Registrants Registration Statement on
    Form S-8
    filed with the Commission on November 2, 2007 (file
    No. 333-147128))  ASML ANNUAL REPORT 2010
 F-54




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##### Table of Contents



Exhibit No.

Description4.24

ASML Performance Stock Option Plan for Senior and Executive
    Management (version 1) (Incorporated by reference to the
    Registrants Registration Statement on
    Form S-8
    filed with the Commission on August 29, 2008 (file
    No. 333-153277))4.25

ASML Performance Share Plan for Senior and Executive Management
    (version 1) (Incorporated by reference to the Registrants
    Registration Statement on
    Form S-8
    filed with the Commission on August 29, 2008 (file
    No. 333-153277))4.26

ASML Restricted Stock Plan (version 2) (Incorporated by
    reference to the Registrants Registration Statement on
    Form S-8
    filed with the Commission on August 29, 2008 (file
    No. 333-153277))4.27

ASML Performance Stock Plan for Members of the Board of
    Management (Incorporated by reference to the Registrants
    Registration Statement on
    Form S-8
    filed with the Commission on October 13, 2009 (file
    No. 333-162439))4.28

ASML Performance Stock Option Plan for Senior and Executive
    Management (version 1) (Incorporated by reference to the
    Registrants Registration Statement on
    Form S-8
    filed with the Commission on October 13, 2009 (file
    No. 333-162439))4.29

ASML Performance Share Plan for Senior and Executive Management
    (version 1) (Incorporated by reference to the Registrants
    Registration Statement on
    Form S-8
    filed with the Commission on October 13, 2009 (file
    No. 333-162439))4.30

ASML Share and Option Purchase Plan for Employees (Incorporated
    by reference to the Registrants Registration Statement of
    Form S-8
    filed with the Commission on October 20, 2010 (file
    No. 333-170034)8.1

List of Subsidiaries*12.1

Certification of CEO and CFO Pursuant to
    Rule 13a-14(a)
    of the Securities Exchange Act of 1934*13.1

Certification of CEO and CFO Pursuant to
    Rule 13a-14(b)
    of the Securities Exchange Act of 1934 and 18 U.S.C.
    Section 1350 as Adopted Pursuant to Section 906 of the
    Sarbanes-Oxley Act of 2002*15.1

Consent of Deloitte Accountants B.V.*    *
    
    Filed at the Commission herewith#
    
    Certain information omitted
    pursuant to a request for confidential treatment filed
    separately with the Securities and Exchange Commission  ASML ANNUAL REPORT 2010
 F-55