Adecco S.A. (Holding Company) –
Notes to financial statements
in millions, except share and per share information and compensation table data

Compensation and shareholding of acting members of the Board of Directors and the Executive Committee

The amounts indicated in this paragraph include honorariums (fees), salaries, loans, bonuses, and compensation in kind (according to market value at time of conferral). The members of the Board of Directors are compensated in cash. The Chairman is partially compensated with Adecco S.A. shares. The amount conferred to the members of the Board of Directors for the fiscal year 2010 amounted to CHF 5.1. The total of all compensation conferred for the fiscal year 2010 to all members of the Executive Committee, including bonus payments for 2010 due in 2011, and awards granted in 2010 under the LTIP, at grant date fair value, amounted to CHF 27.9. Not included are bonus payments due for 2009 but made during 2010 as this information was disclosed in 2009.

Further information on the compensation of the Board of Directors and the Executive Committee of the Adecco Group can be found in the Remuneration Report.

Individual compensation and shareholding for 2010 and 2009 are presented in the following tables:

Board of Directors compensation

For the year 2010

[1]Including Director’s and Company’s social contributions.

[2]Indicating the number of registered shares held, with a par value of CHF 1 each. The members of the Board of Directors and the Executive Committee are required to disclose to the Company direct or indirect purchases and sales of equity related securities of Adecco S.A. Such transactions are published on the website of the Company (refer to: http://www.adecco.com).

[3]CHF 300,000 of the total net compensation was paid with Adecco S.A. shares.

[4]Refer to Corporate Governance Report, section 1.2 “Significant shareholders” and Note 5 “Significant shareholders” regarding shares held by a group to which Andreas Jacobs is a member.

For the year 2009

[1]Including Director’s and Company’s social contributions.

[2]Indicating the number of registered shares held, with a par value of CHF 1 each. The members of the Board of Directors and the Executive Committee are required to disclose to the Company direct or indirect purchases and sales of equity related securities of Adecco S.A. Such transactions are published on the website of the Company (refer to: http://www.adecco.com).

[3]CHF 300,000 of the total net compensation was paid with Adecco S.A. shares.

[4]Refer to Corporate Governance Report, section 1.2 “Significant shareholders” and Note 5 “Significant shareholders” regarding shares held by a group to which Andreas Jacobs is a member.

Executive Committee compensation

The following elements have to be taken into account when comparing the compensation of the Executive Committee for 2010 and 2009:

• The individual annual base salaries for the major part of the members remained basically unchanged.
• The CEO joined the Company in June 2009 and thus, his compensation was accounted for seven months only.
• In 2009, seven members joined the Executive Committee in October and thus, their compensation was accounted for three months only.
• The strong business performance in 2010 resulted in high achievements under the STIP.

For the year 2010

[1]Highest conferred individual compensation in 2010.

[2]In 2010, the Executive Committee consisted for the full year of Patrick De Maeseneire, Dominik de Daniel, François Davy, Theron I (Tig) Gilliam Jr., Christian Vasino, Alain Dehaze, Andreas Dinges, Mark Du Ree, Enrique Sanchez, Peter Searle, Federico Vione, and Sergio Picarelli. Notice periods of up to 12 months apply. For two members of the Executive Committee, severance payments of approximately CHF 1.9 million (including bonus entitlement) and CHF 0.9 million, respectively would be due in case of termination of the employment contract by the employer.

[3]Including employee’s social contributions.

[4]Car allowance for private use, car lease financed by the Company, membership fees, housing allowance, relocation, education, health insurance, representation allowance. Includes tax equalisation payments to a member of the Executive Committee, partly refundable to the Company in the future.

[5]Employer’s social contributions.

[6]Value in CHF of Adecco S.A. shares awarded in 2010 under the LTIP 2010 (grant date: March 16, 2010). Valuation of the share awards granted:

• The grant date fair value of the restricted share unit awards (“RSU awards”) is equal to the closing price of the Adecco S.A. share on the day of grant less 3% discount related to non-entitlement of RSU awards to dividend until vesting. An additional discount of 11% is applied to the value of RSU awards granted to the French participants, related to additional 2-year post-vesting restrictions on sale of shares.
• The grant date values of the total shareholder return awards (“TSR awards”) are calculated based on the closing price of the Adecco S.A. share on the day of grant multiplied by the respective probability factors. These factors reflect the likelihood that the respective TSR targets will be met at the end of the performance period. The probability factors of 0.41, 0.25, and 0.15 for relative, absolute, and additional TSR awards, respectively, have been determined using a binomial model. A discount of 3% is applied in relation to non-entitlement of TSR awards to dividend until vesting. An additional discount of 11% is applied to the value of TSR awards granted to the French participants, related to additional 2-year post-vesting restrictions on sale of shares by the participants. Thus, the per-share value of awards granted in 2010 amounts to CHF 50.55 and CHF 56.79 for RSU awards, CHF 20.52 and CHF 23.06 for relative TSR awards, CHF 12.54 and CHF 14.08 for absolute TSR awards, and CHF 7.58 and CHF 8.52 for additional TSR awards (lower values: French participants).

For the year 2009

[1]Highest conferred individual compensation in 2009, not taking into account severance payment to the former CEO. Dieter Scheiff, the former CEO with a minimum contract duration until June 30, 2011, having served until April 2009, received a base salary, including employee’s social contributions, for the term served of CHF 662,900. In addition, the following amounts were conferred: severance payment of CHF 7,533,333 which included salary payment until the end of the minimum contract duration and CHF 1,333,333 for a non-compete undertaking; employer’s social contributions amounted to CHF 601,407 for old age insurance and pension plus CHF 7,550 for additional health/accident insurance. The total amount conferred was CHF 8,805,190.

[2]In 2009, the Executive Committee consisted of Patrick De Maeseneire (since June 2009), Dominik de Daniel, François Davy, Theron I (Tig) Gilliam Jr., and Christian Vasino (all since January 2009), and Alain Dehaze, Andreas Dinges, Mark Du Ree, Enrique Sanchez, Peter Searle, Federico Vione, and Sergio Picarelli (all since October 2009). For Andreas Dinges, Mark Du Ree, Enrique Sanchez, Federico Vione, and Sergio Picarelli, base salary information relates to compensation received in the fiscal year 2009 for activities as member of the Executive Committee only, i.e. excluding compensation received in relation to other positions prior to such activity as member of the Executive Committee. Bonus payments and LTIP 2009 awards relate to the full calendar year 2009. Peter Searle became a member of the Executive Committee at the end of October 2009. Compensation information only included for November and December 2009. For the members of the Executive Committee, except for Andreas Dinges, notice periods of up to 12 months apply. For Andreas Dinges, the minimum contract duration is until June 30, 2011 with an additional severance payment in the amount of six monthly salaries in case of termination of the employment contract by the employer until that date. For two further members of the Executive Committee, severance payments of approximately CHF 2.3 million (including bonus entitlement) and CHF 1.1 million respectively would be due in case of termination of the employment contract by the employer. In addition, a total amount of CHF 1,515,953 was conferred to a member of the Executive Committee who left the Company in September 2009, consisting of a base salary, including employee's social contributions for the term served of CHF 412,500, severance payment of CHF 948,103, employer's social contributions of CHF 130,599 for old age insurance and pension, additional health/accident insurance of CHF 4,049 and compensation in kind for relocation costs of CHF 20,702.

[3]Including employee’s social contributions.

[4]Besides Patrick De Maeseneire, Andreas Dinges received a guaranteed bonus in 2009. For Tig Gilliam and Mark Du Ree, part of the bonus was conferred under the STIP bonus programme (of the Executive Committee members, only Tig Gilliam and Mark Du Ree qualified for a bonus under the STIP).

[5]For the achievements of the Executive Committee members in the course of the economically challenging fiscal year 2009, including but not limited to the completion of two major transactions, and also due to outstanding efforts in the restructuring process, the Board of Directors, upon proposal of the NCC, decided to grant Mark Du Ree, Tig Gilliam, Enrique Sanchez, Federico Vione, Sergio Picarelli, and Christian Vasino an extraordinary one-time cash bonus. The total amount of this extraordinary discretionary cash bonus was approximately CHF 2.2 million.

[6]Car allowance for private use, car lease financed by the Company, membership fees, housing allowance, relocation, education, health insurance, representation allowance. Amount includes tax equalisation payments to Mark Du Ree, partly refundable to the Company in the future.

[7]Employer’s social contributions.

[8]Value in CHF of Adecco S.A. shares awarded in 2009 under the LTIP 2009 (grant date: March 16, 2009; CEO: April 1, 2009). Valuation of the share awards granted:

• The grant date value of the EPS awards is calculated based on the closing price of the Adecco S.A. share on the day of grant multiplied by a probability factor. This factor reflects the likelihood that the EPS target will be met at the end of the performance period. The probability factor of 0.91 has been determined using internal long-term projections at the date of grant.
• The grant date value of the TSR awards is calculated based on the closing price of the Adecco S.A. share on the day of grant multiplied by a probability factor. This factor reflects the likelihood that the TSR target will be met at the end of the performance period. The probability factor of 0.439 has been determined using a binomial model.
• For awards with guaranteed vesting, the grant date value is equal to the closing share price of the Adecco S.A. share on the day of grant (refer to the table in section “Share awards”).

For 2010, the variable portion of cash compensation (annual bonus) to the CEO amounted to 120% and for the other members of the Executive Committee ranged between 60% and 120% of the base salary. The variable portion of compensation consisting of share awards (at values as indicated in the previous table) to the CEO amounted to 96% and for the other members of the Executive Committee ranged between 36% and 80% of the base salary. The CEO has achieved the cap of the STIP based bonus, and the other members of the Executive Committee have reached between 97% and 120% (cap) of the STIP bonus base.

Compensation of former members of Governing Bodies (Board of Directors, Executive Committee, closely linked parties)

Dieter Scheiff, former CEO with minimum contract duration until June 30, 2011, having served until April 2009, was conferred an amount of CHF 0.7 (including employer’s social contributions) in 2010, relating to the fulfilment of non-compete obligations.

No compensation payments were made to other former members of Governing Bodies in relation to their former offices.

Shares allocated to Governing Bodies

In 2010, no Adecco S.A. shares were allocated to current or former members of Governing Bodies, except for part of the Chairman’s compensation delivered in form of shares (refer to the Board of Directors, compensation table on page 166).

Share ownerships of Governing Bodies

As per December 31, 2010, the members of the Board of Directors, including parties closely linked, reported to hold 758,772 shares; not included are the shares held by a group to which Andreas Jacobs is a member (refer to section 1.2 “Significant shareholders” of the Corporate Governance Report). For the individual share ownerships of the Board of Directors, refer to the table “Board of Directors compensation” and to section 1.2 “Significant shareholders” of the Corporate Governance Report.

As per December 31, 2010, the members of the Executive Committee, including parties closely linked, reported to hold 32,768 shares. For the individual share ownership of the Executive Committee, refer to the following table:

[1]Indicating the number of registered shares held, with a par value of CHF 1 each.

[2]In addition, holding of 166,000 Adecco warrants (equity covered American calls), strike price CHF 80.00, expiry date December 17, 2010.

The members of the Board of Directors and the Executive Committee are required to disclose to the Company direct or indirect purchases and sales of equity-related securities in accordance with the requirements of the SIX Swiss Exchange. Such transactions are published on the website of the Company (refer to: http://www.adecco.com).

Stock options and share awards held by and granted to Governing Bodies

Stock options

Stock options outstanding, as granted since the merger of Adia and Ecco in 1996, exercised by, lapsed from, and held by the members of Governing Bodies in office as of December 31, 2010 and as of December 31, 2009, are presented in the following table (no stock options were granted since 2004):

As of December 31, 2010

As of December 31, 2009

One option entitles the holder to purchase one Adecco S.A. share under the conditions as outlined in the respective plan.

Options shown as “held” in the tables above are included as part of the total options outstanding presented in the table appearing in the Corporate Governance Report, section 2.7 “Convertible notes and options” and Note 9 “Stock-based compensation” to the consolidated financial statements.

For additional information on stock options, refer to the Corporate Governance Report, section 2.7 “Convertible notes and options”.

Share awards

Share awards held as of December 31, 2010 granted on March 16, 2010 under the LTIP:

[1]Split into relative TSR, absolute TSR, and additional TSR awards (one third each).

Share awards as of December 31, 2010 and as of December 31, 2009 granted on March 16, 2009 and April 1, 2009 under the LTIP:

[1]For EPS awards refer to the description of the long-term incentive plan for the awards granted in 2009 as described on pages 189 and 190 of the Annual Report 2009.

[2]Special conditions: grant date April 1, 2009, vesting of 58% of the awards granted is guaranteed, subject to continued employment.

Additional fees and remuneration of Governing Bodies

No member of the Board of Directors received any additional honorariums in 2010.

Loans granted to Governing Bodies

In 2010, the Company did not grant any guarantees nor loans or advances or credits to members of the Board of Directors or to members of the Executive Committee, including closely linked parties.