Management Board Report on the activity of the JSW S.A. for 2012
1.6. Agreements concluded with managers providing for compensation in the event of their resignation or dismissal from the occupied position
Agreements concluded with managers providing for compensation in the event of their resignation or dismissal from the occupied position without an important reason or in the event that their dismissal resulted from a merger with the Company through an acquisition.
Still in force in 2012 were the Management Contracts (“Contracts”) and Non-Competition Agreements entered into in 2011 with members of the JSW S.A. Management Board pursuant to the decision of the JSW S.A. Supervisory Board of 18 November 2011. On 1 March 2012, the Supervisory Board appointed Mr. Robert Kozłowski to the position of Vice-President of the JSW S.A. Management Board for Financial Matters for the 7th term of office and signed with him a Management Contract and a Non-Competition Agreement under the same terms and conditions as those binding the other Management Board members.
In accordance with the provisions of the Management Contracts, if a Contract is terminated by JSW S.A. for reasons other than a gross breach of the provisions of the Contract by the JSW S.A. Management Board member, expiration of the Contract as a result of expiration and non-renewal of the Management Board member’s mandate or termination of the Contract by the Management Board member for reasons attributable to JSW S.A., the Management Board member is entitled to a severance pay in the amount of 3 times the fixed monthly salary. If the dismissal of the Management Board member or the non-appointment of the Management Board member for the next term of office is unrelated to the Benchmark (correlation of the changing JSW S.A. share price with the value of the WIG-20 index) for which in the reasonable opinion of JSW S.A. the relevant Management Board member is responsible or co-responsible with other Management Board members, in the event of termination of the Contract due to expiration and non-renewal of his/her mandate, the Management Board member is entitled to a severance pay in the amount of 3 times the fixed monthly salary.
In addition, pursuant to the Non-Competition Agreement, in the period of 12 months from the termination of the Management Contract, the Manager receives compensation in the total amount constituting the equivalent of 100% of the fixed salary paid to him/her in the period of 12 calendar months preceding the termination of the Management Contract. If the termination or non-extension of the Management Contract takes place in connection with the Benchmark for which in the reasonable opinion of JSW S.A. the Manager is responsible or co-responsible with other Management Board members, the Manager will receive compensation in the total amount constituting the equivalent of 25% of the fixed salary paid to him/her in the period of 12 calendar months preceding the termination of the Management Contract. In both situations, the Manager’s entitlement to compensation will be contingent on his/her refraining from the conduct of any business competitive to that of JSW S.A. Such compensation will be paid to the Manager in monthly installments.
In 2012, no compensation was paid under any non-competition agreement.
