HERMÈS - 2019 Universal Registration Document

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COMBINED GENERAL MEETING OF 24 APRIL 2020 PURPOSE AND DRAFT RESOLUTIONS

EIGHTEENTH RESOLUTION: STOCK OPTIONS

Purpose Pursuant to the 18 th resolution, we ask you to renew the authorisation granted to the Executive Management to grant stock options to the employees and Executive Corporate Officers of the company and its subsidiaries. Since 2008, no stock option plan has been offered to employees and Executive Corporate Officers of the Company and its subsidiaries. The Company would, however, like to renew this authorisation so that it still has the possibility of using this mechanism. Options may be a suitable compensation tool in certain situations, including for aligning the interests of Senior Executives and employees with those of shareholders by creating value in the medium and long term. There are strict regulations on granting options. The total number of stock options that may be granted pursuant to this resolution and not yet exercised, and the total number of free shares awarded pursuant to the 18 th resolution may not represent a number of shares greater than 2% of the total number of ordinary shares existing at the time of the grants, without taking into account: those already granted pursuant under previous authorisations; s those not definitively allocated at the end of the vesting period provided for in the sixth paragraph of Article L. 225-197-1, I of the French s Commercial Code ( Code de commerce ); those no longer subject to the retention period provided for in the seventh paragraph of Article L. 225-197-1, I of the French Commercial Code s ( Code de commerce ). The share purchase price would be set by the Executive Management, within the limits and according to the methods laid down in law. Given the regulations currently in force, the purchase price may not be less than 80% of the average price quoted over 20 stock market trading days on the Euronext Paris regulated market preceding the option grant date, nor may it be less than 80% of the average purchase price of the shares held by the Company, acquired in particular as part of the buyback programme. This price may not be changed, unless the Company were to undertake the financial transactions referred to in Article L. 225-181 of the French Commercial Code ( Code de commerce ), during the lifetime of the options. In this event, Executive Management would adjust the number and price of the shares in line with the legal provisions. The stock options may be exercised within a maximum period of seven years from their grant date. In accordance with Article L. 233-32 of the French Commercial Code ( Code de commerce ), this delegation of authority may be implemented during a public offering on the shares of the Company. In the event one or more Executive Chairmen are granted stock options: the Company must meet one or more of the conditions specified in Article L. 225-186-1 of the French Commercial Code ( Code de commerce ); i.e.: 1) either also grant such options to all of the Company’s employees and to at least 90% of the employees of its French subsidiaries, or s grant free shares to the employees referred to above, or s enhance (or set up if necessary) arrangements for profit-sharing and/or incentive schemes for employees of the Company and its subsidiaries; s in accordance with the provisions of Article L. 225-185 of the French Commercial Code ( Code de commerce ), the Supervisory Board must 2) ensure that the stock options may not be exercised before the relevant Executive Chairmen cease their duties, or must set a quantity of shares resulting from the exercise of stock options to be kept in registered form until the termination of their duties; in addition, in accordance with the Afep-Medef Corporate Governance Code, to which the Company refers: 3) the exercise price of the options will not include any discount, s the options granted will be subject to demanding performance conditions to be met over several years and defined at the time of their s granting, the maximum percentage of shares to which Executive Chairmen may subscribe by virtue of their stock options under this resolution will be s 0.05% of the share capital at the date on which Executive Management decides to grant them, this sub-limit being offset against the 2% ceiling common to the delegations under the 18 th and 19 th resolutions.

This authorisation would be valid for 38 months from the date of the General Meeting. The Statutory Auditors’ report on the 18 th resolution is presented on page 443.

2019 UNIVERSAL REGISTRATION DOCUMENT HERMÈS INTERNATIONAL

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