Termination and Change of Control Provisions

Pursuant to the current employment practices of Bombardier, the compensation of each of the Named Executive Officers is revised and set on an annual basis by the HRCC as described on the Remuneration of Named Executive Officers page.

As a general rule, Bombardier does not sign employment contracts with its executives. As a result, when the employment of an executive has to be or is terminated, any termination settlement to which he/she might be entitled according to the circumstances at hand would then be determined either in accordance with the applicable law or jurisprudence or by mutual agreement. As part of any termination agreement with an executive, Bombardier requests the inclusion of non-solicitation, non-disclosure and non-compete provisions for the duration of the severance period.

In the case of Mr. Hachey, there is an agreement pursuant to which he would be entitled to receive a separation allowance in an amount equal to 18 months of his base salary and target bonus in the event that his employment is terminated by the Corporation. Had Mr. Hachey been terminated on December 31, 2013, he would have been entitled to a cash lump sum payment of $2,674,000. In order to compensate Mr. Hachey for part of the loss of his accumulated pension with his previous employer, Mr. Guy C. Hachey is entitled to an additional amount of $1,316,000, payable if his employment is terminated at age 58 by Bombardier for reasons other than cause. 

This additional amount would also be paid to his spouse in the event of his death during that same period.

In the case of Mr. Lutz Bertling, there is an agreement pursuant to which he would be entitled to receive a separation allowance in an amount equal to 24 months of his base salary and target bonus in the event that his employment is terminated by the Corporation prior to age 60, and 12 months of his base salary and target bonus if his employment is terminated by the Corporation after age 60. As per Mr. Lutz Bertling’s employment contract, the earliest date at which the Corporation can terminate his employment without cause is April 1, 2015.

In the case of Mr. André Navarri, there is an employment agreement which is governed by French law, pursuant to which he would be entitled to receive a separation allowance in an amount equal to 24 months of his base salary and target bonus in the event that his employment is terminated by the Corporation. Had Mr. André Navarri’s employment been terminated on December 31, 2013, he would have been entitled to a cash lump sum payment of $5,306,100. This amount was converted from Euros to US dollars based on an exchange rate of 1.3791 as of December 31, 2013.

As of the date of the 2014 Management Proxy Circular, there are no other termination or severance agreements or arrangements, including change-of-control arrangements, between Bombardier and any of the other NEOs.

The following table describes the consequences resulting from different types of termination from employment on the entitlement to the benefits of the Bombardier compensation programs assuming the event took place on December 31, 2013. As a general rule, only the accrued and vested benefits are paid under each of the compensation plans. 

Read the Types of Termination table

The following table set forth estimates of the amounts payable to each of the NEOs upon retirement, termination without cause or death, assuming that each such event would have taken place on December 31, 2013.

Read the Supplementary Amounts table