2013 Registration document and annual financial report - page 143

Registration Document 2013
141
Corporate Governance
3
Interests and Compensation
Pension and termination benefits
Termination benefits
Compensation payable to Mr. Hennequin for loss
of office as Chairman and Chief Executive Officer
On November 2 and December 15, 2010, the Board of Directors
decided that the compensation payable toMr. Hennequin for loss of
office would be equal to 24 months’ worth of his fixed and variable
compensation, determined based on the amounts paid to him for
the fiscal year preceding that of the loss of office. It was decided
that this compensation would be payable if Mr. Hennequin’s term
of office as Chairman and Chief Executive Officer were either
terminated or not renewed (except in the event of gross or willful
misconduct) and would be subject to the following performance
criteria being met:
ƒƒ
consolidated return on capital employed for the previous three
yearsmust have exceeded the Group’s cost of capital as published
in the Registration Documents for those years;
ƒƒ
hotel operations must have reported positive operating free cash
flow in at least two of the previous three years;
ƒƒ
like-for-like EBITDAR margin must have exceeded 25% in at
least two of the previous three years.
These performance criteria would be applied as follows:
ƒƒ
if all three criteria were met, the compensation would be
payable in full;
ƒƒ
if two of the three criteria were met, half of the compensation
would be payable;
ƒƒ
if none or only one of the three criteria weremet, no compensation
would be due.
The methods of determining the compensation for loss of office
payable to the Chairman and Chief Executive Officer as described
above were approved at the Annual Shareholders’ Meeting on
May 30, 2011.
When Mr. Hennequin’s term of office as Chairman and Chief
Executive Officer was terminated, the Board of Directors confirmed
that the three criteria set out above had been met and therefore
noted that the full amount of his compensation for loss of office
was payable to him, representing €3,586,200.
In addition, the Board of Directors authorized the waiver of the
condition that Mr. Hennequin still be a member of the Group on the
date his stock options are exercised or his performance shares vest.
Termination benefit payable to Mr. Caillère
On October 13, 2010, the Board of Directors decided that the
termination benefit that would be payable to Mr. Caillère – equal to
24months’ worth of his fixed and variable compensation, determined
based on the amounts paid to him for the fiscal year preceding that
in which his employment contract is terminated by the Company
(except in the event of gross or willful misconduct) – would be
subject to the following performance criteria:
ƒƒ
consolidated return on capital employed for the previous three
yearsmust have exceeded the Group’s cost of capital as published
in the Registration Documents for those years;
ƒƒ
hotel operations must have reported positive operating free cash
flow in at least two of the previous three years;
ƒƒ
like-for-like EBITDAR margin must have exceeded 25% in at
least two of the previous three years.
These performance criteria would be applied as follows:
ƒƒ
if all three criteria were met, the termination benefit would be
payable in full;
ƒƒ
if two of the three criteria were met, half of the termination
benefit would be payable;
ƒƒ
if none or only one of the three criteria were met, no termination
benefit would be due.
It was further decided that Mr. Caillère would not be entitled to
any compensation for loss of office for his position as an executive
officer.
The methods of determining the termination benefit payable to
Mr. Caillère were approved at the Annual Shareholders’ Meeting
on May 30, 2011.
WhenMr. Caillère was removed from office on August 27, 2013, the
Board of Directors confirmed that the three criteria set out above had
been met and therefore noted that the full amount of his termination
benefit was payable to him, representing €1,940,400. Following
the termination of his term of office, Mr. Caillère’s employment
contract – which had previously been suspended – came back
into force, and the Company then terminated this employment
contract with effect fromDecember 31, 2013. Mr. Caillère disputed
this termination, following which the Company, as authorized by
the Board, signed a termination settlement agreement with him.
The agreement specifies in particular that the salary received by
Mr. Caillère from August 27 through December 31, 2013 will be
deducted from his termination benefit.
The agreement also states that the Board may waive the condition
that Mr. Caillère still be a member of the Group on the date his
stock options are exercised or his performance shares vest.
Compensation payable to Mr. Bazin in the event
of loss of office as Chairman and Chief Executive
Officer
On December 16, 2013, the Board of Directors decided that the
compensation payable to Mr. Bazin for loss of office would be equal
to twice the amount of the total fixed and variable compensation
payable to him for the fiscal year preceding that of the loss of
office. It was decided that (i) this compensation would be payable if
Mr. Bazin’s term of office as Chairman and Chief Executive Officer
were terminated (except in the event of gross or willful misconduct)
or if his term of office as a director were not renewed, and (ii) it
would be subject to the following performance criteria being met:
ƒƒ
consolidated return on capital employed for the previous three
yearsmust have exceeded the Group’s cost of capital as published
in the Registration Documents for those years;
ƒƒ
the Group must have reported positive operating free cash flow
in at least two of the previous three years;
ƒƒ
like-for-like EBITDAR margin must have exceeded 27.5% in at
least two of the previous three years.
These performance criteria would be applied as follows:
ƒƒ
if all three criteria were met, the compensation would be
payable in full;
ƒƒ
if two of the three criteria were met, half of the compensation
would be payable;
ƒƒ
if none or only one of the three criteria weremet, no compensation
would be due.
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