2 They concern over 500 of L’Oréal’s active or retired senior managers, in France, and are financed by contributions paid to an insurance institution. These contributions are deductible from the corporate income tax and are subject to the employer’s contribution as provided by Article  L.  137-11, 2a) of the French Social Security Code at a rate of 24%. In the light of the legal characteristics of defined benefit pension schemes (the rights only accrue if the beneficiary ends his career in the Company and the funding of this scheme cannot be broken down individually by employee) and on account of the characteristics specific to the L’Oréal schemes, known as “differential” schemes since they take into account, in order to supplement them, all the other pensions such as those resulting, inter alia, from the French basic and supplementary pension schemes, the precise amount of the pension annuity will in fact only be calculated on the date when the beneficiary applies for all his pensions. 2.4.3.4. Application of the related-party agreements scheme The above provisions are subject to the procedure for related ‑party agreements. The benefits that may be due under Mr Jean-Paul Agon’s suspended employment contract were approved by the Annual General Meeting of 27 April 2010 pursuant to Article L. 225-38 of the French Commercial Code. The Annual General Meeting of 17  April 2018 approved the implementation of the provisions of Mr Jean-Paul Agon’s employment contract regarding defined benefit pension scheme commitments for the duration of his renewed corporate office. For Mr Nicolas Hieronimus, an agreement suspending his employment contract was approved by the Annual General Meeting of 20 April 2021 (resolution no. 15). This mechanism is restated every year in the chapter on the remuneration of corporate officers and in the Statutory Auditors’ special report on related-party agreements. 2.4.3.5. Situation of Mr Jean-Paul Agon for the period from 1 January 2021 to 30 April 2021 Mr Jean-Paul Agon was appointed as Chief Executive Officer in April  2006, following a brilliant career spanning 27  years with L’Oréal. The Board of Directors did not wish for Mr Jean-Paul Agon, who accepted the office of Chief Executive Officer after 27 years within L’Oréal, to be deprived of the benefits to which he would have continued to be entitled had he remained an employee, and adopted the following measures: 1) Maintenance of the employment contract and  separation of the benefits attached to the corporate office and the employment contract The remuneration under the suspended employment contract to be taken into account for all the rights attached thereto, and in particular for the calculation of the defined benefit pension referred to below, is based on the amount of remuneration at the date of suspension of the contract in 2006, namely fixed remuneration of €1,500,000 and variable remuneration of €1,250,000. This reference remuneration is revised annually by applying the revaluation coefficient in respect of salaries and pension contributions published by the French state pension fund ( Caisse nationale d’assurance vieillesse ). As   of 1 January 2021, the fixed remuneration amounted to €1,731,000 and the variable remuneration to €1,442,500. The seniority applied covers his entire career within the Group, including the years he was Chief Executive Officer and Chairman and Chief Executive Officer. 2) Dismissal, termination or retirement indemnities, financial consideration for the  non-competition clause Payment of the indemnities due under the suspended employment contract had been approved by the Annual General Meeting on 27 April 2010. In the event of termination of his suspended employment contract during the term of corporate office, and depending on the reasons for such termination, it was foreseen that Mr Jean-Paul Agon would only be paid termination indemnities, except in the event of gross misconduct or gross negligence, or retirement indemnities in the event of voluntary retirement or at the Company’s request pursuant to the suspended employment contract. These indemnities, which are attached solely to termination of the employment contract and in strict application of the National Collective Bargaining Agreement for the Chemical Industries (Convention Collective Nationale des Industries Chimiques) and the company-level agreements applicable to all L’Oréal managers, are automatically due pursuant to the public policy rules of French labour law. They are not subject to any condition other than those provided for by the National Collective Bargaining Agreement for the Chemical Industries or the above-mentioned company-level agreements. The same applies to the non-compete clause and the related financial consideration. Pursuant to the schedule of indemnities under the National Collective Bargaining Agreement for the Chemical Industries, in the event of dismissal, except in the event of gross misconduct or gross negligence, the indemnity could be capped, in light of Mr  Jean-Paul Agon’s length of service, at 20  months’ remuneration under the suspended employment contract. In respect of the employment contract, pursuant to the provisions of the National Collective Bargaining Agreement for the Chemical Industries, in the event of termination of the employment contract, provided that the indemnity due in consideration of the non-compete clause would be payable every month for two years on the basis of two-thirds of the monthly fixed remuneration attached to the suspended employment contract unless Mr  Jean-Paul Agon were to be released from application of the clause. This clause does not apply in the event of voluntary retirement or compulsory retirement on the Company’s initiative: no consideration for non-competition would be paid in such a situation. 3) Defined benefit pension scheme Mr Jean-Paul Agon benefits, under his suspended employment contract, from the “Garantie de Retraite des Membres du Comité de Conjoncture” (Pension Cover of Members of the Comité de Conjoncture) scheme closed to new members effective from 31  December 2000. The main features of this scheme, which falls under Article L. 137–11 of the French Social Security Code, are as follows: • around 120 senior managers (active or retired) are concerned; • the minimum length of service requirement was 10 years at the time of closure of the scheme on 31  December 2000; and L ’ ORÉAL I UNIVERS AL REGISTRATION DOCUMENT 2021 121 CORPORATE GOVERNANCE Remuneration of directors and corporate officers