Carrefour - 2017 Registration Document

CORPORATE GOVERNANCE Statutory Auditors' special report on regulated agreements and commitments 2017 REGISTRATION DOCUMENT | CARREFOUR 3. 166 expires before two years, the abovementioned targets will be assessed for the year preceding expiry of his term of office. The settlement payment will be made in the event of termination of his term of office as Chairman and Chief Executive Officer for whatever reason, except in cases of removal for serious misconduct or wrongful acts or following a change in his appointment within the Carrefour Group. The Board of Directors will ensure that the performance conditions have been met upon termination of Mr. Alexandre Bompard’s term of office. Reasons justifying that the agreement is in the Company’s interest The settlement payment is subject to a non-compete obligation which will bind Mr. Alexandre Bompard during an 18-month period as of the termination of his duties as Chairman and Chief Executive Officer. Its purpose is to prohibit the Chairman and Chief Executive Officer from exercising professional duties in rival concerns including a certain number of specific companies in the food retail industry. Commitments given by the Company in favor of Mr. Alexandre Bompard, Chairman and Chief Executive Officer, concerning the supplementary defined benefit pension plan Person concerned: Mr. Alexandre Bompard, Chairman and Chief Executive Officer. Nature and purpose: On 18 July 2017, the Board of Directors authorized Mr. Alexandre Bompard’s eligibility for the supplementary defined benefit pension plan. Terms and conditions Mr. Alexandre Bompard will be eligible for the supplementary defined benefit pension plan intended for the Group’s main executives whose gross annual remuneration is greater than 18 times the French social security annual ceiling. Eligibility for the plan is subject to all of the following conditions: receiving gross annual remuneration (fixed and variable) in excess of 18 times the French social security annual ceiling; being on the Carrefour payroll when the basic social security pension is taken; working at the Carrefour Group for at least three consecutive years; and having reached the age mentioned in Article L.161-17-2 of the Social Security Code. to the exclusion of any other direct or indirect form of remuneration. The benchmark remuneration is equal to the average gross annual remuneration received at Carrefour Group during the last three calendar years preceding the year of cessation of activity. This average is capped at 60 times the French annual social security ceiling. To determine benchmark remuneration, only the gross base salary and annual variable remuneration paid are considered, The annual supplementary pension benefits amount to 2.75% of the benchmark remuneration per year of seniority, subject to compliance with applicable performance targets. The pension amount is also calculated by deducting benefits from supplementary pension plans in place at Carrefour (benefits from a collective retirement savings plan or from a pension plan funded by salary contributions are not taken into account). The seniority applied to calculate supplementary pension benefits is that acquired by the Chairman and Chief Executive Officer as an employee or executive within the Carrefour Group. The acquiring of supplementary pension plan benefits is subject to performance targets implemented in accordance with the requirements of Article L.225-42-1 of the French Commercial Code. A year is only taken into account in determining the pension amount if the performance conditions for that year are attained. The Board of Directors determines the applicable performance conditions each year corresponding, subject to exception, to at least 80% satisfaction of quantitative performance conditions triggering the payment of annual variable remuneration of the Chairman and Chief Executive Officer. Furthermore, the grant of an additional pension requires the validation of at least two-thirds of the years with respect to the performance conditions throughout the individual’s presence within the Group. The aggregate amount of gross annual pension plus any gross annuities from supplementary pension plans in force within the Carrefour Group (for the portion of pension corresponding to employer funding) is capped at 25% of benchmark remuneration. Furthermore, the amount of gross annual pension cannot exceed the difference between: 45% of benchmark remuneration and the gross annual amount of all social security contributions for basic, additional and supplementary pensions. At the end of each year, the Board of Directors verifies the achievement of the performance conditions during the prior year. In the event that the conditions are not met, the year in question will not be taken into account when calculating the pension amount. At the end of the term of office of the Chairman and Chief Executive Officer, the Board of Directors will meet to verify that all performance conditions have been met. If this is the case, the additional pension will automatically be granted. If not, no additional pension will be paid. Reasons justifying that the commitment is in the Company’s interest The Board of Directors considered that this commitment in favor of Mr. Alexandre Bompard will foster a sense of loyalty and commitment.