LEGRAND / 2018 Registration document

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

CORPORATE GOVERNANCE

COMPENSATION AND BENEFITS OF COMPANY OFFICERS

Overview of the Performance Unit Plans in practice The 2013 and 2014 Performance Unit Plans are subject to presence and performance criteria. Details are provided in the chart below:

STAGE 1 Allocation by the Board of Directors of an initial number of Future Performance Units This number is theoretical as it corresponds to the target achievement rate of the future performance criteria related to the Future Performance Units

STAGE 2 Review of the presence condition and the

STAGE 3 Application of an additional 2-year lock-in period During this period, no payment will be made in respect of the Future Performance Units

STAGE 4 Payment of Future Performance Units

3-year vesting period

2-year lock-in period

performance criteria related to Future Performance Units based on the Group's future achievements over the next 3 years Subject to compliance with a presence condition, determination of the final number of vested Future Performance Units depending to the achievement of performance criteria

After taking into account the indexing of the Future Performance Units to Legrand ’ s stock price during the lock-in period

Nature of the performance criteria attached to the Future Performance Units and measured after a three-year vesting period from the date of the initial award of Future Performance Units

The applicable performance criteria, which cover all performance units, are identical to those attached to the Performance Shares, as described in the section “Existing Performance Shares Plans” on page 228-230 of this registration document, except with respect to the extra-financial performance criterion introduced in 2016, relating to the average achievement rate of the Group’s CSR roadmap priorities over three years and to the criterion based on the stock market performance of Legrand, introduced in 2018.

For each Future Performance Unit Plan, based on the recommendations of the Compensation Committee, the Board of Directors determines the target “external” and “internal” performance criteria, which will be measured over a three-year period. The target level is set to ensure that the performance criteria are demanding. After the three-year vesting period, the performance criteria will be measured and the number of Future Performance Units finally awarded to beneficiaries will be calculated according to the following method:

2013 Performance Unit Plan

“External” financial performance criterion

Payment rate (1)

0%

100%

145% Actual: 90.8%

Average difference, in favor of Legrand, between Legrand’s EBITDA margin and the MSCI average over a three-year period

Lower than or equal to 4 points

Equal to or highter than 12 points

Equal to 8.3 points

Actual: 8.0 points

(1) For any point between the limits given in the table above, the payment rate is calculated on a straight-line basis.

“Internal” financial performance criteria

Payment rate (1)

0%

100%

145% Actual: 109.6%

Average normalized free cash flow as a percentage of sales over a three-year period

Lower than or equal to 9% Equal to 12.4%

Equal to or higher than 16%

Actual: 13.2%

(1) For any point between the limits given in the table above, the payment rate is calculated on a straight-line basis.

Overall achievement rate of the 2013 Performance Unit Plan: 100.2%.

222

LEGRAND

REGISTRATION DOCUMENT 2018