APC 2006 Annual Report Download - page 53

The options have a ten-year life (since 2006).
The options are granted at an exercise price that
does not include any discount to the Schneider Electric
SA share price at the time of grant.
Half of the options (performance options) vest only if
certain targets are met (value creation, sales or oper-
ating margin).
The Supervisory Board determines the degree to
which the targets are met, based on advice from the
Remunerations and Appointments & Corporate Gover-
nance Committee. For the annual plan set up in
December 2006, 20% of the stock options were
replaced by stock grants for members of the Manage-
ment Board and Executive Board who are resident in
France for tax purposes, on the basis of one stock
grant for four stock options.
Pension benefits
French members of the management board and
supervisory board are covered by the Group’s top hat
pension plan for senior executives, which provides for
the payment of pension benefits corresponding to up
to 60% (50% plus 1% per year from the sixth to the fif-
teenth year of service) of their average compensation
for the three calendar years preceding their retirement
(corresponding to the sum of (i) their gross basic
salary and (ii) their variable bonus for the reference
years) less the total benefits received under external
plans, with a cap of 25% of the reference average
compensation. On the death of the executive, the plan
provides for the payment of a 60% reversionary pen-
sion to his or her spouse. The capitalized amount of
Benefits
Mr. Lachmann’s benefits include a chauffeur-driven
Company car. This benefit in kind can be estimated for
the 2006 fiscal year at 5,837.
He is also covered by the Company's top hat pension
plan for senior executives, under the plan's general
terms and conditions. During the year, he claimed his
pension representing annual benefits equal to 25% of
his average compensation for the three calendar years
prior to his retirement. On his death, his spouse will
receive a reversionary pension equal to 60% of this
amount. Mr. Lachmann was not paid any compensa-
tion for loss of office.
Stock options
Henri Lachmann, who was granted options under
plans 16 through 21, 24, 26 and 27, exercised 46,700
plan 16 options at a price of 50.73 and 71,600 plan
17 options at a price of 50.73 during the year. As of
January 1, 2007, he held 941,000 options, including
500,000 performance options.
Compensation of the Supervisory
Board members and the former
members of the Board of Directors
Compensation of the Chairman of the
Supervisory Board – period from May 4 to
December 31, 2006
Based on the recommendation of the Remunerations
and Appointments & Corporate Governance Commit-
tee, at its meeting on May 3, 2006, the Supervisory
Board decided to set the annual compensation of its
Chairman at 500,000, not including the attendance
fees paid to Supervisory Board members.
2006 2005
(January 1 to May 3
Salary 273,333 800,000
2005 bonus (paid in 2006) - 1,507,668
2006 bonus (paid in 2006) 675,500 -
Attendance fees 20,220 60,000
Benefit in kind 1,787 5,231
Total 970,840 2,372,899
pension plans in connection with all the management
is approximately 15.4 million.
Non-French members are covered by funded pension
plans in line with local practice in their respective
countries.
Compensation, benefits
and stock options of the
Chief Executive Officer – period
from January 1 to May 3, 2006
Compensation
Based on the recommendation of the Remunerations
and Appointments & Corporate Governance Commit-
tee, at its meeting on February 15, 2006, the Board of
Directors decided to set the 2006 compensation of
Henri Lachmann, Chairman and Chief Executive Offi-
cer, on the same basis as for 2004 and 2005. His
annual salary was set at 800,000 and his target
bonus at 125% of this amount, with a maximum of
250% based solely on personal targets concerning, in
particular, the adoption of new bylaws, the organiza-
tion of the Group, ongoing implementation of the
acquisitions strategy and optimization of the Group’s
financial resources. At its meeting on May 3, 2006, the
Board of Directors assessed the degree to which the
Chairman and Chief Executive Officer had met his tar-
gets, based on advice from the Remunerations and
Appointments & Corporate Governance Committee.
On this basis, Henri Lachmann was paid a salary of
273,333 for the period from January 1 to May 3, 2006
and a bonus of 675,500.
His compensation as Chairman and Chief Executive
Officer for the last two years was as follows:
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