Siemens 2014 Annual Report Download - page 151

171 C. Combined Management Report 247 D. Consolidated Financial Statements 337 E. Additional Information

The following targets were set and attained with respect to
these two target parameters for variable compensation (bonus):
Target parameter % of target Actual FY  figure Target attainment
Return on capital employed (ROCE)
15.4% 17.3% 163.67%
Free cash fl ow
€ 5,250 million € 5,201million 97.55%
1 Continuing and discontinued operations. The values measured for target attainment were not adjusted.
In addition, in determining target attainment, the attainment
of Sector-specifi c targets for economic value added (EVA) and
of the respective individual targets was taken into account. In
measuring attainment of the individual targets, the Super-
visory Board took account of the Compensation Committee’s
recommendation.
In an overall assessment of all aspects, taking individual
achievements into account and exercising its duty-bound
discretion (pfl ichtgemäßes Ermessen), the Supervisory Board
decided to adjust the bonus payout amounts resulting from
target attainment downward for one Managing Board member.
Taking this adjustment by the Supervisory Board into account,
target attainment grades of the bonus for members of the
Managing Board came to between . % and . %.
Long-term stock-based compensation
For half of the annual target amount for the Stock Awards, an
average basic EPS of €. was determined for fi scal years 
through , yielding a target attainment of  %.
For the other half of the annual target amount for the Stock
Awards, the Supervisory Board approved a number of Stock
Awards equivalent to the monetary value of half the target
amount on the award date. The amount by which these stock
commitments must be adjusted – or an additional cash pay-
ment must be made – after the end of the restriction period
will depend on the performance of Siemens stock compared to
the stock of fi ve competitors – ABB, Alstom, General Electric,
Rockwell and Schneider – over the coming four years, and will
therefore not be determined until after the end of fi scal . If
signifi cant changes occur among the relevant competitors
during the period under consideration, the Supervisory Board
may appropriately take these changes into account in deter-
mining the values for comparison and / or calculating the rele-
vant stock prices of those competitors.
The number of stock commitments (Bonus Awards and Stock
Awards) granted was based on the closing price of Siemens
stock in Xetra trading on the date of award less the present
value of dividends expected during the holding period, because
benefi ciaries are not entitled to receive dividends. This fi gure
for determining the number of commitments amounted to
€. (: €.).
Benefits associated with termination
of Managing Board membership
As Barbara Kux’s appointment to the Managing Board expired
regularly on November , , no compensatory payments
were agreed upon in that connection. The Stock Awards already
granted in the past for fi scal ,  and , for which the
restriction period is still running, will be absolutely maintained,
in accordance with the terms of her contract with the Company.
In connection with the mutually agreed termination of Peter Y.
Solmssen’s activity on the Managing Board as of December ,
, it was agreed that his contract with the Company would
remain in effect until March , . The entitlements agreed
upon under the contract will remain in effect until that date.
These will not include the fringe benefi ts under the contract,
particularly the Company car and contributions toward the cost
of insurance, which will be covered until the contract ends by
a monthly lump-sum payment of € ,. The Stock Awards
already granted in the past for fi scal ,  and , for
which the restriction period is still in progress, will be abso-
lutely maintained. Mr. Solmssen was also reimbursed for relo-
cation costs, in accordance with the commitment he received
when he took offi ce. The Company furthermore re imbursed
Mr. Solmssen for out-of-pocket expenses of € , plus
value added-tax.
In connection with the mutually agreed termination of
Dr. Michael Süß’s activity on the Managing Board as of May ,
, it was agreed that his current contract with the Company
would terminate as of September , . The entitlements
agreed upon under the contract remained in effect until that
date. Dr. Süß receives a compensatory payment in the gross
amount of € ,, in connection with the mutually agreed
premature termination of his activity as a member of the Man-
aging Board, together with a one-time special contribution of
€ , to the BSAV, to be credited in January . It was
also agreed with Dr. Süß that the long-term stock-based
compensation (Stock Awards) for fi scal  will be calculated
once the actual target attainment is available, and will be
granted at the usual date. The Stock Awards already granted
in the past and those for fi scal , for which the restriction
period is still running, will be absolutely maintained, in accor-
dance with the terms of his contract with the Company, and
will be settled in cash in September  at the closing price
of Siemens stock in Xetra trading on May ,  (€ .).
Dr. Süß agreed not to take up activities for any signifi cant
competitor of Siemens for a period of one year after the end
of his employment contract ‒ that is, until September ,
. For this post-contractual non-compete commitment, he
will be paid a monthly total of gross € ,. In determining
the amount of the compensatory payment for Dr. Süß, in ac-
cordance with the terms of his contract with the Company,
the base compensation for fi scal  and the variable com-
pensation and long-term stock-based compensation actually
received for fi scal  were applied and limited, as applica-
ble, to either two annual payments in total or the compensa-
tion for the remaining term of his appointment. The portion
of the compensatory payment that was calculated excluding
the fi rst six months of the remaining contract term was re-
duced by  % as a lump-sum allowance for discounted values
and for income earned elsewhere. In addition, non-monetary
benefi ts were covered by a payment in the amount of  % of
the compensatory payment.
Total compensation
On the basis of the decisions by the Supervisory Board de-
scribed above, Managing Board compensation for fi scal 
totaled € . million, a decrease of . % (: € . mil-
lion). Of this total amount, € . million (: € . million)
was attributable to cash compensation and € . million
(: € . million) to stock-based compensation.
The following disclosure of the compensation granted for fi s-
cal  takes account not only of the applicable reporting
standards, but also of the recommendations of the Code. Con-
sequently, the model table recommended by the Code for dis-
closing the value of benefi ts granted for the year under review
was used. The fi gures presented also include the attainable
minimums or maximums, as applicable. The fair values shown
for granted stock-based compensation were calculated on the
basis of the applicable reporting standards. The transfer of
one share per award will not take place until the expiration of
the four-year waiting or restriction period – that is, not until
November . The number of Stock Awards linked to the
performance of the price of Siemens stock will be adjusted
after the end of the restriction period, on the basis of the
actual target attainment. Accordingly, the value of the ac-
tual shares transferred may be higher or lower than shown
here, also depending on the stock price in effect at the time
of transfer.
The compensation presented on the following pages was
granted to the members of the Managing Board for fi scal 
(individualized disclosure).