Financial Report and Registration Document 2010 - Groupe Seb

4 NOTES
COMPANY FINANCIAL STATEMENTS
TO THE COMPANY FINANCIAL STATEMENTS
NOTE 14
PENSION AND OTHER POST-EMPLOYMENT BENEFIT OBLIGATIONS
Thierry de La Tour d’Artaise participates in the top-hat pension scheme for
French members of the Group Executive and Management Committees.
This scheme is in addition to the statutory pension plans and comprises a
defined contribution plan (known as the “Article 83” plan) supplemented by
a defined benefit plan:
a top-hat plan, subject to seniority conditions and provided the executive
is still with the Company. It is designed to ensure a total replacement rate
in addition to the statutory plans by providing up to 25% of the reference
compensation, calculated as the average of the target compensation for
the final three years;
a supplementary benefi t plan, also subject to seniority conditions and
provided the executive is still with the Company. Its entitlements vest
at an annual rate of 0.8% of the reference compensation, calculated as
the average of the target compensation for the fi nal three years. The
plan is capped at a maximum of 20 years, i.e. 16% of the reference
compensation.
To qualify for the defined benefit plan, Group executives must have been a
member of the Executive or Management Committee for at least eight years.
The scheme is capped at 41% of the reference compensation (including
pensions paid under statutory plans).
On 19 March 2010, the Board of Directors decided to cap the reference
compensation that serves as the basis for calculation to 36 times the annual
Social Security ceiling on the date of retirement.
The Group’s objective is to fund the entire benefi t obligation by making
regular top-up contributions to an external fund. Payments have been made
to the fund since 2008.
TERMINATION BENEFITS
Thierry de La Tour d’Artaise will not be entitled to any compensation for loss
of office when he ceases to be a corporate officer.
His employment contract, signed when he joined the Group in 1994 and last
amended when he was appointed Chief Executive Officer, was suspended
on 1 March 2005 for the duration of his term as corporate officer.
In the same way as for other Executive Committee members, the contract
stipulates that in the event of termination of his employment contract at
Groupe SEB’s initiative, except as a result of gross negligence or serious
misconduct, or at his own initiative following a change of control of Groupe
SEB, Thierry de La Tour d’Artaise will be eligible for a total termination benefit
equal to two years’ remuneration. Following adoption of France’s TEPA Act,
an addendum to this contract was signed making the termination benefit
subject to performance conditions. The revised contract stipulates that the
termination benefit, set at a maximum of two years’ gross salary and bonus,
will be adjusted based on actual performance in relation to targets over
Thierry de La Tour d’Artaise’s last four years of service, as follows:
if average actual performance falls short of the targets by 50% or more,
no termination benefit will be paid;
if average actual performance represents 50% to 100% of the targets,
between 75% and 100% of the termination benefit will be paid;
if average actual performance exceeds the targets, the termination benefit
will be paid in full.
The Board of Directors may, at its discretion, reduce the termination benefit
by as much as 50% if the Group reports a loss for the year preceding the
one in which Thierry de La Tour d’Artaise is removed from office, provided
that the termination benefi t does not represent less than his salary and
bonus for his final year of service if average actual performance is at least
equal to 50% of targets.
His employment contract does not contain any no-compete clause.
Thierry de La Tour d’Artaise was re-appointed on 13 May 2008. In accordance
with the October 2008 AFEP-MEDEF Code, the Board of Directors therefore
decided to review the situation in 2012, when his term of office is due to expire.
NOTE 15
UNRECOGNISED DEFERRED TAXES
At 31 December 2010, the Company had an unrecognised deferred tax asset of €1.4 million (€0.9 million at 31 December 2009), corresponding to nondeductible
provision charges and unrealised exchange gains deductible in the following year.
130 FINANCIAL REPORT AND REGISTRATION DOCUMENT 2010 GROUPE SEB