Fiscal 2021 Universal Registration Document

Twelfth and thirteenth resolutions: Approval of the compensation policies applicable to the Chairwoman of the Board of Directors and the Chief Executive Officer for Fiscal 2022

Purpose

In accordance with article L.22-10-8 II of the French Commercial Code, in the twelfth and thirteenth resolutions, shareholders are invited to approve the compensation policies applicable to the Chairwoman of the Board of Directors and the Chief Executive Officer adopted by the Board of Directors.

These principles and criteria will apply from Fiscal 2022 until the approval of a new compensation policy by the Shareholders Meeting.

Chairwoman of the Board of Directors’ compensation policy 

The compensation policy applicable to the Chairwoman of the Board of Directors for Fiscal 2022 is unchanged from that approved at the Ordinary Annual Shareholders Meeting of January 12, 2021.

However, with the termination of the term of office of Denis Machuel on September 30, 2021 and the Board of Directors’ decision to temporarily combine the positions of Chairman of the Board of Directors and Chief Executive Officer pending the appointment of a new Chief Executive Officer, this policy provides that Sophie Bellon receives additional fixed compensation of 18,750 euro per month as compensation for performing these duties on an interim basis. This additional compensation will terminate when a new Chief Executive Officer takes up office.

The Chairwoman's compensation structure remains unchanged over the interim period, without any variable compensation or restricted shares.

Chief Executive Officer’s compensation policy 

The main proposed changes to the compensation policy of the Chief Executive Officer for Fiscal 2022 compared to that approved at the Ordinary Annual Shareholders Meeting of January 12, 2021 are the following:

• the review and strengthening of the scope of application of the non-compete agreement, particularly with the introduction of new restrictions in terms of targeted businesses and sectors and geographical coverage. The Chief Executive Officer would be subject to a non-compete obligation for a minimum term of 24 months, restricting his/her freedom to hold any position as an employee or corporate officer, or carry out any consulting work. As consideration for these restrictions, he or she would be paid an indemnity, the amount of which could amount up to a maximum of 24 months of his/her fixed and variable compensation; 
• the change in the payment condition of an indemnity in the event of termination of office (the amount of which would remain equal to twice the amount of the Chief Executive Officer’s annual compensation). The payment of this indemnity would not be any more subject to an annual increase in Sodexo’s consolidated underlying operating profit of at least 5% but would be paid subject to an achievement rate for the Chief Executive Officer’s annual variable compensation targets of at least 80% for each of the two fiscal years ended prior to the termination of the appointment. The maximum payable amount and the payment conditions for the two fiscal years ended prior to the termination of the appointment have been specified;
• the delay for complying with shareholding obligations has been extended in order to take into account the external recruitment of a new Chief Executive Officer. Compliance would be required as from the vesting date of the first share award, i.e., three years following the initial grant by the Company. 

The compensation policies submitted for shareholder approval are proposed by the Board of Directors based on the recommendation of the Compensation Committee and are presented in the Board of Directors’ Corporate Governance Report provided in chapter 6, section 6.5.1 of the Company’s Fiscal 2021 Universal Registration Document.