Alcatel-Lucent : Compensation of new Chief Executive Officer, Michel Combes
Compensation of new Chief Executive Officer, Michel Combes
· Fixed salary of EUR 1.2 million
· Variable compensation element directly linked to transformation of the
Paris, March 14, 2013 - The Board of Directors of Alcatel-Lucent (Euronext
Paris and NYSE: ALU) has approved the compensation of the new Chief Executive
Officer, Michel Combes who, from March 1, 2013, has become a French tax
In regulatory filings to financial authorities in France and the United
States, Alcatel-Lucent confirmed that, Mr. Combes, who becomes Alcatel-Lucent
CEO on April 1, 2013, will receive annual compensation comprised of two
elements: a fixed gross salary of EUR 1.2 million (the same as the previous
CEO's base salary), and a variable compensation element directly linked to the
transformation of the company.
The performance objectives and variable compensation level will be determined
each year by the Board of Directors upon recommendation of the Compensation
Committee. The target variable compensation will be 100% of Mr. Combes' annual
fixed compensation, should performance criteria be met at 100%. This bonus
could reach a maximum of 200% of the fixed compensation should performance
objectives be exceeded very substantially.
For 2013, Mr. Combes' variable compensation level will be determined by two
factors - 50% based on the Alcatel-Lucent Group's 2013 operating profit and
50% based on achieving targets set out in The Performance Program announced on
July 26, 2012.
The Board of Directors has also agreed the award of a total of 1,300,000
'Performance Units', and indexed to the performance of the Alcatel-Lucent
stock over three years. One third of these units will vest each year subject
to the fulfillment of performance conditions, but will be unavailable until
April 1, 2016. At this date and subject to the continued presence of the CEO
within the company, these units give beneficiaries the right to remuneration
indexed on the basis of the average price of Alcatel-Lucent stock over the 20
trading days preceding April 1, 2016.
Mr. Combes will benefit from the private pension scheme applicable to all
corporate executives of the Alcatel-Lucent Group's French subsidiaries to
cover the portion of their remuneration exceeding eight times the annual
French social security ceiling. Specific to Mr. Combes, this pension scheme is
subject to additional performance conditions. He will not benefit from a
supplementary pension scheme.
Mr. Combes will also be eligible for a termination benefit in the event of a
change of control of strategy. This benefit is equal to one year of Mr Combes'
fixed and target variable remuneration and is subject to a performance
condition consisting of the delivery of positive free cash flow for at least
one fiscal year until the end of the CEO's mandate.
These commitments are subject to both quantitative and qualitative criteria,
and will be submitted for approval at the company's next Annual Shareholders
meeting, on May 7, 2013.
Full details of Mr. Combes' compensation terms and conditions can be found at
www.alcatel-lucent.com under the heading 'Company' and then in the Corporate
Governance pages within the section 'Overview'.
Michel Combes' appointment as CEO of Alcatel-Lucent was announced on February
22. He will also join the company's Board of Directors, subject to the
approval of shareholders at the Alcatel-Lucent annual general meeting on May
ABOUT ALCATEL-LUCENT (EURONEXT PARIS AND NYSE: ALU)
The long-trusted partner of service providers, enterprises and governments
around the world, Alcatel-Lucent is a leading innovator in the field of
networking and communications technology, products and services. The company
is home to Bell Labs, one of the world's foremost research centers,
responsible for breakthroughs that have shaped the networking and
Alcatel-Lucent innovations are regularly recognized by international
institutions for their positive impact on society. In 2012 and for the second
year running, Alcatel-Lucent was named one of the Thomson Reuters Top 100
Global Innovators, recognition for the company's continued addition to its
world-class patent portfolio, one of the largest in the telecom industry.
Alcatel-Lucent has also been recognized for its sustainability performance.
In 2012 the company was ranked Technology Supersector Leader by the Dow Jones
Sustainability Index. Through its innovations, Alcatel-Lucent is making
communications more sustainable, more affordable and more accessible as we
pursue our mission of Realizing the Potential of a Connected World.
With operations throughout the world, Alcatel-Lucent is a local partner with
global reach. The Company achieved revenues of Euro 14.4 billion in 2012 and
is incorporated in France and headquartered in Paris.
For more information, visit Alcatel-Lucent on: http://www.alcatel-lucent.com,
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Compensation Michel Combes March 14 2013 (E)
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Source: Alcatel-Lucent via Thomson Reuters ONE
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