APC 2014 Annual Report Download - page 158

3CORPORATE GOVERNANCE
INTERESTS AND COMPENSATION OF GROUP SENIOR MANAGEMENT
under the Group's personal accident insurance policies is subject connection with a change in shareholder structure as
to the achievement of either of the two following performance described above;
conditions: (i) the average net profit for the last five financial years
Dismissal, non-renewal or requested resignation as(iii)
preceding the event is positive or (ii) the average free cash flow for
CEO/Deputy CEO when, on average, two-thirds of the
the last five years is positive.
Group performance criteria (to be distinguished from
individual performance objectives) have been achieved for
Agreements related to resignation the last four financial years from the day of his resignation
Non-compete agreement
(including the financial years during which he served at the
management board).
Mr.Tricoire and Mr.Babeau are bound by a non-compete Involuntary Severance Pay will not be paid if a resignation is the
agreement in case of resignation from the Group. The one-year result of serious or wrongful misconduct.
agreement calls for a compensation to be paid at 60% of fixed
and target variable parts for Mr.Tricoire, and Mr. Babeau. Involuntary Severance Pay depends on the average rate of
achievement of the Group’s performance criteria (to be
In line with the recommendations of the AFEP/MEDEF Code, at its distinguished from individual performance objectives) used to
meeting of October24, 2013 the board decided that, for any determine the performance incentive for the last three financial
resignation other than voluntary, it will have to decide on the years preceding the date of the board meeting at which the
application or not of the non-compete clause. However, with decision is made.
regard to voluntary resignations, the board decided that a release
from the non-compete obligation may be given through an If the Group Criteria are:
agreement with the person under such obligation. However, this Less than two-thirds achieved: no compensation will be paid;
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exception is not applicable if such person leaves while the
Two-thirds achieved: he will receive 75% of the Maximum
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performance conditions required for Involuntary Severance Pay
Amount;
have not been met, and does not or will not have rights to or is
not or will not be eligible to receive both non-compete At least 100% achieved: he will receive 100% of the Maximum
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compensation and pension payments. In the latter case, the Amount;
board would decide on whether to implement the non-compete Between 66% and 100% achieved: he will receive between
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clause (see chapter8, pages315 and 316). 75% and 100% of the Maximum Amount calculated on a
Involuntary Severance Pay
straight-line basis according to the rate of achievement.
To date, the achievement rate of Group performance criteria for
MrTricoire and MrBabeau benefit from Involuntary Severance the previous three financial years is, on average, 120%.
Pay, capped at twice the average of their effective annual
compensation (fixed and variable part) for the last three years (in
Retention of stock options, stock grants and
cash to the exclusion of all other components), authorized by the
performance shares
board (hereafter, «Maximum Amount»), taking into account the Mr. Tricoire and Mr. Babeau shall retain, subject to performance
non-compete compensation and subject to performance condition, the benefit of their stock options, stock grants and
conditions. performance shares granted to them or that will be granted to
The right to Involuntary Severance Pay is available in the following them in the event of Involuntary Severance during the vesting
cases: period or prior to having exercised said options. Accordingly, it is
specified that the foregoing will be applicable only provided that:
Dismissal, non-renewal or resignation as CEO / Deputy CEO(i)
in the 6 months following a material change in Schneider
Average rate of achievement of Group performance criteria that
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Electric’s shareholder structure that could change the
determine the performance incentive calculated for the last
membership of the board of directors;
three financial years at the time of departure, is at least
Dismissal, non-renewal or resignation as CEO / Deputy CEO(ii)
two-thirds of the objective;
in the event of a reorientation of the strategy pursued and
Resignation is not the result of wrongful or gross misconduct.
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promoted by him until that time, whether or not in
156 2014 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC