registration document France Telecom 2009 - Orange.com

15 RULES
compensation and benefits paid to directors, officers and senior management
FOR DETERMINING COMPENSATION OF DIRECTORS AND OFFICERS
15.1 RULES FOR DETERMINING COMPENSATION OF DIRECTORS
AND OFFICERS
The criteria used to determine the compensation of directors and
offi cers or the circumstances by virtue of such compensation
established are as follows:
15.1.1 Principles and rules
for determining attendance fees
In accordance with the law, the maximum amount of
attendance fees that can be paid annually to directors is set
by the Annual Shareholders’ Meeting. The resolution voted by
France Telecom S.A.’s Shareholders Meeting remains valid until
a new resolution is adopted. The Annual Shareholders’ Meeting
of May 27, 2008 set this sum at 600,000 euros.
Up to this amount and on a proposal of the Governance and
Corporate Social Responsibility C ommittee , the Board of
Directors decides at the beginning of each year on the amount
of attendance fees that shall be paid to board members in
respect of the last fi nancial year , and the rules for distributing
them.
Since 2006, directors receive a fi xed amount (currently
10,000 euros), and also a variable amount based on attendance
at board and committee meetings and on duties performed
within such committees.
Attendance fees paid to directors representing the French
government are paid to the French Treasury D epartment.
Moreover, most of the directors representing employees have
asked that their attendance fees be paid to their trade union
organization.
Except for the Chairman and directors representing the
employees and employee shareholders, who are themselves
Company employees, directors do not receive any compensation
other than attendance fees.
In addition, except for the deferred compensation of the
Chairman mentioned in Section 15.1.2 Rules for determining
the compensation of the Chairman and of the Chief Executive
Offi cer, there is no agreement between the members of the
Board of Directors and France Telecom S.A. or between them
and any of France Telecom’s subsidiaries providing for the
granting of benefi ts upon termination of offi ce.
15.1.2 Rules for determining the
compensation of the Chairman
and of the Chief Executive
Officer
The compensation of the Chairman and of the Chief Executive
Offi cer is set by the Board of Directors on the recommendation
of the Governance and Corporate Social Responsibility
Committee.
Every six months, the Committee examines and proposes
to the Board of Directors the parameters for calculating the
variable portion of the compensation of the Chairman and of
the Chief Executive Offi cer for the following six-month period,
and proposes the amount of the variable portion for the past
six-month period based directly on France Telecom’s results.
Compensation of the Chairman and Chief
Executive Officer in 2009
Fixed compensation
The fi xed portion of the compensation of the Chairman and
Chief Executive Offi cer was decided by the board meeting of
October 28, 2002. It has not been modifi ed since. In particular,
it has not changed since Didier Lombard was appointed on
February 27, 2005.
Variable compensation
Where the objectives set by the Board are achieved, the
variable portion of the compensation of the Chairman and Chief
Executive Offi cer in respect of 2009 may amount to 66.6% of
his fi xed compensation, with the maximum set at 100% of his
fi xed compensation in the event objectives are exceeded.
In the fi rst and second half of 2009, the Chairman’s six-monthly
variable portion was assessed on the basis of an overall fi nancial
objective calculated on the scope of the France Telecom Group
and consisting of the weighted average growth rate on a likefor-like
basis of the revenues (30%) and of the Organic cash
fl ow indicator (50%) as well as an objective associated with the
quality of service provided to Group customers (20%).
Deferred compensation
On March 24, 2010, the Chairman announced to the Board of
Directors that he would waive his right to the commitment made
to him by the Company, as authorized by the board meeting of
April 2, 2008. The Board formally recorded this decision and
noted that said possible deferred compensation had ceased to
be valid.
On April 2, 2008, the Board of Directors had made a decision, in
accordance with Article L. 225-42-1 of the French Commercial
Code (as modifi ed by law no. 2007-1223 dated August 21,
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2009 REGISTRATION DOCUMENT / FRANCE TELECOM