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Board of Directors dated February 12, 2010

The Board of Directors decides that:

Termination indemnity: Benoît Potier

The Board of Directors decides that, in the event of the forced departure of Mr Potier (removal from office, non-renewal of his duties, request for resignation) from his corporate offices as Chairman and Chief Executive Officer

  • a) related to a change of strategy, or
  • b) that takes place within 24 months following the acquisition of control of Air Liquide by a person acting alone or several persons acting in concert (the notion of control being understood within the meaning of this term as defined, as of the date hereof, by Article L. 233-3 of the French Commercial Code), and subject to the conditions and limitations set out below, the Company undertakes to pay Mr Potier a fixed aggregate indemnity in full discharge equal to 24 months’ gross fixed and variable remuneration, the calculation being based on the average monthly amount of gross fixed and variable remuneration received by Mr Potier, during the 24 months prior to departure. It is specified that in the case referred to in paragraph (b), the indemnity is due, whether or not the forced departure is related to a change in strategy, but without Mr Potier being able to receive such indemnity in conjunction with that due pursuant to paragraph (a).

In accordance with the provisions of Article L 225-42-1 – 1 of the French Commercial Code, the Board of Directors decides that payment of the indemnity due in respect of the above-mentioned forced departure, is subject to compliance, as duly recorded by the Board of Directors at the time of termination of such office or thereafter, of conditions related to Mr Potier’s performance assessed in light of the Company’s own performance, defined as of the date hereof as follows:

Entitlement to the above-mentioned indemnity will depend on, and the amount of the indemnity paid will be adjusted on the basis of, the average of the annual variance between the Return on capital employed after tax (ROCE) and the Weighted Average Cost of Capital (WACC) (assessed on the basis of net equity according to the financial statements) calculated (on the basis of the certified consolidated financial statements approved by the annual shareholders’ meeting) with respect to the last 3 financial years prior to the financial year in which the departure occurs. For the purposes of this calculation, the variance between ROCE and WACC will be measured with regard to each financial year and will be calculated on the basis of the average of the three annual variances for the last 3 financial years prior to the financial year during which such departure takes place.

The following formulas will be applied:
Average variance (ROCE – WACC)Proportion of the indemnity due
≥ 200 bp*100%
≥ 100 bp and < 200 bp66%
≥ 50 bp and < 100 bp50%
≥ 0 bp and < 50 bp33%
< 00

* bp: basis points


These conditions will be re-examined by the Board of Directors and modified, where applicable, to take into account, in particular, any changes that have taken place in the company’s environment at the time of each renewal of Mr Potier’s term of office and, where applicable, during the course of his term of office.

The Board of Directors also decides that, in the event that the above-mentioned forced departure were to take place within a period of 24 months prior to the date on which Mr Benoît Potier’s term of office as Chairman and Chief Executive Officer ends pursuant to the articles of association due to the fact that he has reached the statutory age limit, the amount of the indemnity due will in any event be capped at the number of months’ gross remuneration, as defined above, between the date of forced departure and the date on which the statutory age limit is reached. In any case, no indemnity shall be paid if M. Potier applies for his retirement pension at the time of forced departure.

After deliberation, in accordance with the provisions of Articles L 225-38 et seq. of the French Commercial Code, the Board of Directors authorises the above-mentioned commitment effective as from the close of the Annual Shareholders’ Meeting approving the financial statements for the 2009 financial year on the condition precedent of renewal of the term of office of Mr Benoît Potier as director and Chairman and Chief Executive Officer of the Company, for the length of his term of office as Chairman and Chief Executive Officer, thus renewed where applicable, with Mr Benoît Potier not taking part in the vote.

In accordance with the provisions of Article L 225-42-1 of the French Commercial Code, this decision and the decision by the Board of Directors making an assessment with regard to achievement of the performance conditions at the required time, will be made public in accordance with the terms and conditions and within the deadlines set by the regulations in force.

The above-mentioned decision will be subject to the approval of the shareholders at such Annual Shareholders’ Meeting, within the scope of a specific resolution for Mr Benoît Potier.

This decision cancels and supersedes the decision of the Board of Directors of February 13, 2009 relating to the same subject matter as from the effective date.

Mr Benoît Potier gives his agreement with regard to the above-mentioned decision.

Notice of this authorisation will be given to the statutory auditors.

Indemnity to compensate for the loss of pension rights in respect of his corporate office in favour of Benoît Potier

Concerning Mr Benoît Potier, who had accrued the right to a pension annuity within the scope of defined-benefit pension plan “S” in the event of removal from his corporate office or dismissal before he reaches 55 years of age, the Board of Directors decides that, in order to compensate for the loss of this right resulting from the change in the scheme, subject to what is set out below, an indemnity to compensate for the loss of his rights under the Company’s plan “S” will be paid to Mr Benoît Potier, in the event of termination of his corporate office before he reaches 55 years of age on the Company’s initiative and except in the event of gross misconduct or gross negligence,

This indemnity, corresponding to the pension annuity to which Mr Benoît Potier could claim entitlement in respect of plan S, will be paid in instalments, calculated and paid under the same conditions (except for the condition of presence in the Company at the time of retirement) and in accordance with the same rules as those established by the regulations of supplementary pension plan “S” as they are in force at the time when Mr Benoît Potier retires or those of any other defined benefit pension plan which may replace the above-mentioned plan.1

In the event that, on the date of his removal from office, Mr Benoît Potier were nevertheless to be able to benefit from supplementary pension plan “S”, or any other defined-benefit pension scheme that may be substituted therefor, no indemnity will be due.

Performance conditions

Entitlement to the indemnity to compensate for the loss of pension rights described above and the amount of the indemnity paid will be adjusted on the basis of the average of the annual variance between the Return on capital employed after tax (ROCE) and the Weighted Average Cost of Capital (WACC) (assessed on the basis of net equity according to the financial statements) calculated (on the basis of the certified consolidated financial statements approved by the annual shareholders’ meeting) with respect to the last 7 financial years prior to the financial year in which the departure occurs.

For the purposes of this calculation, the variance between ROCE and WACC will be measured with regard to each financial year and will be calculated on the basis of the average of the seven annual variances for the last seven financial years prior to the financial year during which such departure takes place.

The following formulas will be applied:
Average variance (ROCE – WACC)Proportion of the indemnity due
≥ 200 bp*100%
≥ 100 bp and < 200 bp66%
≥ 50 bp and < 100 bp50%
≥ 0 bp and < 50 bp33%
< 00

* bp: basis points


These conditions will be re-examined by the Board of Directors and modified, where applicable, to take into account, in particular, any changes that have taken place in the company’s environment at the time of each renewal of Mr Benoît Potier’s term of office and, where applicable, during the course of his term of office. In any event, the commitment relating to the indemnity to compensate for the loss of pension rights will lapse on Mr Benoît Potier’s 55th birthday.

After deliberation, in accordance with the provisions of Articles L 225-38 et seq. of the French Commercial Code, the Board of Directors authorises the aforementioned commitment effective as from the close of the Annual Shareholders’ Meeting approving the financial statements for the 2009 financial year on the condition precedent of renewal of the term of office of Mr Benoît Potier as director and Chairman and Chief Executive Officer of the Company, for the length of his term of office as Chairman and Chief Executive Officer, thus renewed where applicable (it being specified that in any case this commitment will lapse in 2012 on the date of Mr Benoît Potier’s 55th birthday), with Mr Benoît Potier not taking part in the vote.

In accordance with the provisions of Article L 225-42-1 of the French Commercial Code, this decision and the decision by the Board of Directors making an assessment with regard to achievement of the performance conditions at the required time, will be made public in accordance with the terms and conditions and within the deadlines set by the regulations in force.

The above-mentioned decision will be subject to the approval of the shareholders at such Annual Shareholders’ Meeting, within the scope of a specific resolution for Mr Benoît Potier.

This decision cancels and supersedes the decision of the Board of Directors of February 14, 2008 relating to the same subject matter.

Mr Benoît Potier gives his agreement with regard to the above-mentioned decision.

Notice of this authorisation will be given to the statutory auditors.

1In the event of the death of Mr Potier, an indemnity will be paid to his surviving spouse under the same conditions and according to the same rules as those defined in the regulations for supplementary pension plan “S “or any equivalent clause on the date of Mr Potier’s retirement.