Reebok 2015 Annual Report Download - page 43

TO OUR SHAREHOLDERS
Compensation Report
39
1
Defined benefit pension plans
The amount of pensionable income currently equals the individual fixed annual salary indicated in the table
‘Benefits granted’. Starting from a base amount totalling 10%
3 of the respective pensionable income at
the time of appointment, a module of two percentage points 4 of the pensionable income is formed for each
full year of tenure as an Executive Board member.
The Supervisory Board has, as its targeted level of provision regarding pension commitments for members
of the Executive Board, determined a pension entitlement amounting to a maximum of 40%
5
of an Executive
Board member’s pensionable income. Following the Executive Board member’s departure from the
company, benefit payments are made on a monthly basis
•as a retirement pension upon reaching the age of 65; or
•
as a disability pension in the event of occupational or general disability for medical reasons, for no
longer than up to the point a retirement pension is paid, amounting to the pension entitlement reached
at the point the respective pension became payable;
•as survivors’ benefits upon the death of an Executive Board member, providing the spouse or partner
with 50% of the pension entitlements up to this point and, if applicable, 15% of the pension entitlements
up to this point for each dependent half-orphan or 30% for each dependent orphan. Taken together,
survivors’ benefits may not exceed the deceased Executive Board member’s total pension entitlement.
If survivors’ entitlements exceed the pension entitlement, benefits for dependent children are reduced
proportionately.
In the event that an Executive Board member leaves the company prior to reaching retirement age, the
non-forfeiture of the pension entitlement will be in line with legal provisions. The pension entitlement is
not, as legally envisaged, reduced pro rata temporis, i.e. it amounts to at least the base amount of the
pension commitment made to the Executive Board member, plus the pension modules accumulated
annually during the term of office.
Following commencement of the pension-triggering event, ongoing pensions are adjusted in line with the
development of state pensions.
Defined contribution pension plans
The defined contribution pension plans, each in the form of a direct commitment, basically have the same
structure as the existing ‘adidas Management Pension Plan’ for managers.
An amount (currently) equalling 50% of the individual annual fixed salary is credited by the company to
the virtual pension account of the individual Executive Board member each year. The pension assets yield
a fixed interest of 3% p.a., however for no longer than until the pension benefits initially become due.
Entitlement to the pension benefits becomes vested immediately. The pension benefits comprise pensions
to be received upon reaching the age of 65, or, on application, early retirement pensions to be received
upon reaching the age of 62, as well as invalidity and survivors’ benefits.
On occurrence of the pension-triggering event, the pension benefits generally correspond to the balance
of the pension account including accumulated interest on that date. In case of invalidity or death prior to
reaching the age of 62, for the minimum coverage, the Executive Board member’s pension account will be
credited with the outstanding pension benefits for the time until the Executive Board member would have
reached the age of 62, but no longer than for 120 months (without interest accrual). The pension benefits
due upon death of the Executive Board member are payable to the widow, the widower or the registered
civil partner and the orphans as joint creditors.
3 Deviating provision for Glenn
Bennett: Instead of his initial
appointment date (effective
March 6, 1997), January 1, 2000
is used for the calculation of his
pension entitlements with a base
amount of 20% of pensionable
income; initial appointment of
Herbert Hainer: effective March 6,
1997; initial appointment of Robin
J. Stalker: effective January 30,
2001; initial appointment of Roland
Auschel: effective October 1, 2013;
initial appointment of Eric Liedtke:
effective March 6, 2014.
4 Increase of the annual pension
components of Glenn Bennett
and Robin J. Stalker to three
percentage points of the
pensionable income effective
March 6, 2015.
5 Increase of the targeted provision
level of Glenn Bennett and Robin
J. Stalker to a pension entitlement
of a maximum of 50% of the
individual pensionable income
effective March 6, 2015.