Financial Report and Registration Document 2010 - Groupe Seb

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CORPORATE GOVERNANCE
GROUP MANAGEMENT BODIES
To benefi t from the defi ned benefi t plans, Groupe SEB executives must
have occupied functions within the Group Executive Committee or Group
Management Board for at least eight years.
The scheme is capped at 41% of the reference remuneration (including
benefits from mandatory plans).
Furthermore, the Board of Directors Meeting of 19 March 2010 decided,
in addition to the above rules, to limit the reference remuneration used as
the calculation basis to 36 times the annual Social Security ceiling in force
on the retirement date.
The Group intends to outsource the entire commitment through matching
payments to a fund into which the pension contributions are made on a
regular basis.
Severance allowance
Thierry de La Tour d’Artaise shall not benefit from any compensation payment
by the Board of Directors in the event of termination of his corporate mandate
as a director.
The employment contract under which he joined the Group in 1994, which
eventually led to his appointment as Chief Executive Officer of the Group,
was suspended on 1 March 2005 for the duration of his corporate mandate
as a director.
This contract stipulates that (as for other members of the Group Executive
Committee) in the event of termination of his contract by the employer (except
for reasons of serious professional misconduct, or in the event of a change
in the control of the Group), he would benefi t from a severance package
equal to two years of his total remuneration. In application of the TEPA law,
a new rider to this contract defines the conditions of performance to which
this allowance is subject. It is fixed at two years of remuneration (basic pay
+ bonus), which can vary according to the extent of achievement of targets
over the previous four financial years, as follows:
if the average rate of target achievement is less than 50%, no allowance
is payable;
if the average rate is between 50% and 100%, the allowance shall be
between 75% and 100%, based on a linear calculation;
if the average rate is above 100%, the allowance shall remain at 100%.
The Board of Directors reserves the right to reduce this allowance by a
maximum of one-half if the last trading year showed a net loss; however, the
allowance may not be less than the fixed basic salary plus bonus for the last
financial year if application of the performance criteria based on achievement
of targets gives entitlement to payment of an allowance.
The employment contract binding Thierry de La Tour d’Artaise includes no
allowances concerning a non-competition clause.
TABLE 1
As the mandate of Thierry de La Tour d’Artaise was renewed on 13 May
2008, the Board of Directors, in accordance with the AFEP-MEDEF Code
of October 2008, planned to review the prevailing situation in 2012, the date
of the end of the current mandate of Thierry de La Tour d’Artaise.
Retirement lump-sum payment
The total retirement lump-sum payment entitlement of Thierry de La Tour
d’Artaise amounts to €320,055.
STOCK OPTIONS – PERFORMANCE SHARES
59,942 stock options and 4,995 performance shares were allocated to Thierry
de La Tour d’Artaise in respect of the 2010 financial year.
The Board of Directors decided that 50% of the stock options and 100%
of the performance shares allocated to Thierry de La Tour d’Artaise will be
contingent on performance conditions related to the growth of sales and
operating margin.
Performance will be measured over the unavailability period of four years
for stock options and the two-year vesting period for performance shares.
Performance will be calculated as follows:
if the achievement rate of sales targets and operating margin is equal to
or greater than 100% in one year, one quarter of the stock options and
one half of the performance shares will be irrevocably vested;
if the achievement rate of sales targets and operating margin is lower
than 50% in one year, one quarter of the stock options and one half of
the performance shares will be suspended;
if the achievement rate of sales and operating margin targets is between
50% and 100%, stock options and performance shares will be allocated
on a proportional basis.
In addition, shares originating from the exercise of stock options and
free shares allocated to Thierry de La Tour d’Artaise will be subject to an
obligation to hold them in his name for the duration of occupancy of his
post, in the following amounts:
for shares originating from exercised stock options, a quantity of shares
corresponding to 50% of the net gain on acquisition, net of tax and
statutory deductions, realized at the time of exercise of the options;
for shares allocated free of charge, a quantity of shares corresponding to
50% of the net gain after taxes, statutory deductions and costs.
These amounts will be reduced to 20% of the net gain as soon as the number
of shares held by Thierry de La Tour d’Artaise reaches the equivalent of
2 years of remuneration.
As a reminder, hedging instruments are prohibited and to the knowledge of
the Company, no such instrument has been put in place.
2
Remuneration, stock options and shares allocated to the Chief Executive Officer
2009 2010
Thierry de La Tour d’Artaise – Chairman and Chief Executive Officer
Remuneration due for the year (details in table 2) €1,967,970 €2,095,970
Valuation of stock options allocated during the year (details in table 4)* €410,297 €649,112
Valuation of performance-related shares allocated during the year (details in table 6)* €139,823 €227,772
TOTAL €2,518,090 €2,972,854
* On each allocation date, the book fair value of the stock options and shares is determined in accordance with IFRS rules. This is a historic value on the allocation date, calculated for
accounting purposes according to the method described in Note 19.2.1 of section 3 of the Consolidated Financial Statements. This value does not represent, neither a current market
value nor a discounted value of these stock options and shares, nor the actual amount that could be generated at the exercise of these options, if they are exercised or at the vesting of
these performance shares, if they become vested.
GROUPE SEB
FINANCIAL REPORT AND REGISTRATION DOCUMENT 2010
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