Information
s
on the financial conditions of the cease
tion of the functions of Chairman-
General manager
of Vallourec of
Edward
Guinotte –
other governance topics
(
rendered
public in application of the recommendations
s
code
corporate governance
Afep
-Medef
)
Meudon (France), 2
8
March 2022 –
In accordance with the recommendations of the Afep-Medef corporate governance code, Vallourec publishes the information relating to the financial conditions of the termination of Mr. Édouard Guinotte’s duties as Chairman and Chief Executive Officer, as approved by the Board of Directors on March 26, 2022, on the recommendation of the Compensation Committee meeting on the same day.
The severance pay for Mr. Édouard Guinotte will be subject to the approval of the upcoming General Meeting of Shareholders.
1. Annual fixed compensation for the 2022 financial year
The Board of Directors noted that the fixed compensation of Mr. Édouard Guinotte for the 2022 financial year will amount to 130,434.78 euros gross. It was calculated
pro rata
temporary
from 1
er
January 2022 until the termination of his duties as Chairman and Chief Executive Officer.
2. Annual variable compensation
For the 2021 financial year, the Board of Directors has set the success rate of the objectives at 98.93%. The annual variable compensation of Mr. Édouard Guinotte will therefore be €593,580 gross.
For the period from 1
er
January 2022 to March 20, 2022, the Board of Directors decided to calculate
pro rata
temporary
the variable compensation of Mr. Édouard Guinotte based on a 100% achievement rate of objectives, ie a gross amount of 130,434.78 euros.
In accordance with the legal provisions in force, the payment of this variable compensation will be subject to the approval of the upcoming General Meeting of shareholders.
3. Long-term incentive compensation not yet vested
It is recalled that the Board of Directors and the General Meeting of Shareholders approved respectively on July 27, 2021 and September 7, 2021 the implementation of a plan for the allocation of (i) ordinary shares and (ii ) preference shares convertible into ordinary shares, all subject to the fulfillment of presence and/or performance conditions, as the case may be, with a ratio of 33.33%: 66.67%, in favor of the Chairman and Chief Executive Officer, the Deputy General, members of the Executive Committee and certain executives.
On October 13, 2021, Mr. Édouard Guinotte was thus granted a total of 1,002,767 free shares under this plan, divided into (i) 292,852 free shares Tranche 1, (ii) 292,852 free shares Tranche 2, ( iii) 292,852 Tranche 3 free shares and (iv) 124,211 Tranche 4 free shares.
In accordance with the rules of the plan and the terms and conditions of the free shares, all of Mr. Édouard Guinotte’s T2 free shares, T3 free shares and T4 free shares, and 80% of his T1 free shares will lapse. Mr. Édouard Guinotte will only be entitled to 20% of the 292,852 free shares of Tranche 1.
With regard to Mr. Édouard Guinotte’s rights under other employee share ownership plans, the provisions of these plans will be strictly applied by the Company.
4. Indemnity
s
of
rupture
and non-competition
The Board of Directors authorized the Company and Vallourec Oil and Gas France to enter into a settlement agreement with Mr. Édouard Guinotte (the ”
Protocol
”) in the context of the termination of his duties as Chairman and Chief Executive Officer. This Memorandum provides for the payment to Mr. Édouard Guinotte of a transactional indemnity as well as the implementation of the non-competition obligation provided for when Mr. Édouard Guinotte was appointed. The conclusion of this Protocol was necessary for Vallourec in order to preserve its interests in the context of the departure of its former manager, whose employment contract was suspended, by providing for a waiver of any recourse or action by the latter in respect of the execution and/or the termination of all of his functions within the Vallourec group and by confirming the implementation of the non-competition undertaking for a period of 18 months. The conclusion of this Protocol is in line with the objectives of the Afep-Medef corporate governance code.
Vallourec’s commitments under the Protocol will be subject to the approval of the upcoming General Meeting of shareholders.
4.1 Transactional indemnity
It was agreed under the Protocol for the payment of a transactional indemnity in the amount of 883,237.84 euros gross for the purpose of settling amicably and definitively the terms of the termination of all of Mr. Édouard Guinotte within the Vallourec group. The payment of this transactional indemnity will be subject to the approval of the General Meeting of shareholders to come.
4.2 Compensation for termination of the employment contract
It was also agreed to terminate the employment contract that Mr. Édouard Guinotte, who joined the Vallourec group in 1995, had entered into with Vallourec Oil and Gas France, and which had been suspended since his appointment as Chairman and Chief Executive Officer on March 15, 2020. Mr. Édouard Guinotte is entitled to receive the conventional severance pay provided for by the Collective Agreement for metallurgical managers and engineers, i.e. 439,200 euros gross, as well as a notice indemnity equal 6 months’ salary, i.e. 180,000 euros gross.
4.3 Financial consideration for the non-compete undertaking
Given the nature of his duties, it seemed important to protect the Group’s legitimate interests by requiring that Mr. Édouard Guinotte be subject to a non-competition undertaking, which he accepted. This non-competition obligation covers the following geographical areas: Europe, Middle East, United States, Mexico, Argentina, Brazil, China, Ukraine and Russia.
In return for this non-competition commitment, which will apply for a period of 18 months from the termination of his duties under his corporate office as Chairman and Chief Executive Officer, Mr. Édouard Guinotte will receive a non-competition indemnity. up to a total amount of 728,857.84 euros gross, corresponding to 12 months of fixed and variable gross monetary compensation, paid in 18 monthly installments of 40,492.10 euros gross.
This non-competition commitment and the payment of the corresponding indemnity will be submitted to the approval of the upcoming General Meeting of shareholders.
5. Benefits
Mr. Édouard Guinotte will benefit from outplacement services for 12 months, up to a limit of 50,000 euros (excl. VAT).
6. Supplementary pension plan
Mr. Édouard Guinotte will retain his acquired rights under the defined contribution pension plan known as “Article 82” on the date of termination of his duties as Chairman and Chief Executive Officer.
The payment of the employer’s contribution by Vallourec for the 2021 and 2022 financial years, consisting of a portion paid to the insurer (50%) and a portion paid directly to Mr. Édouard Guinotte (50%), will amount in total to 179,038 euros gross for the 2021 financial year and 39,130 euros gross for the 2022 financial year. These payments will be subject to the approval of the upcoming General Meeting of shareholders.
7. Other information
Mr. Édouard Guinotte resigned on March 25, 2022 from his duties as a director, with immediate effect.
In addition, it is reminded that the term of office of Chairman and Chief Executive Officer of Mr. Édouard Guinotte ended on March 20, 2022. Consequently, and in accordance with the provisions of the French Commercial Code, the term of office of Deputy Chief Executive Officer of Mr. Olivier Mallet is expired on March 20, 2022 (i.e. upon the appointment of Mr. Philippe Guillemot as new Chairman and Chief Executive Officer). The expiry of his term of office was noted by the Board of Directors on March 26, 2022. Since March 21, 2022, the stipulations of Mr. Olivier Mallet’s employment contract in his capacity as Chief Financial Officer, which had been suspended during his term of office of Deputy Chief Executive Officer, again apply. Mr. Olivier Mallet will continue his duties as Chief Financial Officer under the same compensation conditions as those provided for in the context of his duties as Deputy Chief Executive Officer of the Company.
About Vallourec
A world leader in its markets, Vallourec provides leading tubular solutions for the energy sectors and for other of the most demanding applications: from oil and gas wells in extreme conditions to the latest generation power plants, including by bold architectural projects and high-performance mechanical equipment. True to its pioneering spirit and backed by cutting-edge R&D, Vallourec continues to push back technological frontiers. Established in some twenty countries, as close as possible to its customers, the Group brings together nearly 17,000 passionate and committed employees who offer much more than tubes: they offer ever more innovative, reliable and competitive solutions, to make all possible projects.
Listed on Euronext in Paris (ISIN code: FR0013506730, Ticker VK), Vallourec is part of the CAC Mid 60, SBF 120 and Next 150 indices and is eligible for the Deferred Settlement Service (SRD).
In the United States, Vallourec has set up a level 1 sponsored American Depositary Receipt (ADR) program (ISIN code: US92023R4074, Ticker: VLOWY). The parity between the ADR and the ordinary Vallourec share is 5 to 1.
Calendar
|
18 may 202 2 May 24, 2022 | Publication of first quarter 2022 results General Meeting of Shareholders |
For more information, please contact:
|
Investor Relations Jerome Friboulet Phone. : +33 (0)1 49 09 39 77 |
Press relations Heloise Rothenbühler Phone. : +33 (0)1 41 03 77 50 |
Individual shareholder relations |
Attachment
Press Release – EG Severance Package