5 _425 2023 UNIVERSAL REGISTRATION DOCUMENT_MICHELIN 5 FINANCIAL PERFORMANCE 2023 consolidated financial statements Note 32. COMMITMENTS AND CONTINGENCIES 32.1 Commitments 32.1.1 Capital expenditure commitments Capital expenditure on the main projects which were contracted but not delivered before December 31, 2023, amounts to €322 million (of which €262 million is likely to be delivered in 2024). 32.1.2 Other commitments The Group has many purchase commitments for goods and services. These commitments are in line with the level of activity expected in the first half of 2024. They are entered into on arm's length terms in the normal course of business. 32.2 Contingencies 32.2.1 Michelin Pension Trust Ltd UK Following adoption of the Pensions Act 2004 in the United Kingdom, a multi-annual plan of contributions to the UK pension fund (the “Recovery Plan”) was established between the Group's UK companies and their pension funds. In order to limit the amount of contributions, the Group issued guarantees to the pension funds to cover the contributions to be made by its subsidiaries. Michelin Pensions Trust Ltd has also received an additional guarantee covering the possible insolvency of the participating entities. The risk is considered unlikely and the guarantee is capped at £100 million. The last Recovery Plan calculations were performed at March 31, 2023 and the next ones will be performed at March 31, 2026. The actuarial assumptions used to measure the Recovery Plan liability are generally more conservative than the ones used to measure defined benefit obligations under IAS 19. The amount of the Group's guarantee is equal to the difference, if positive, between the present value of future contributions and the amount of the provision booked in the accounts. At December 31, 2023, the present value of future contributions was less than the provision booked in the accounts. Consequently, the amount of the guarantees given to the Michelin Pensions Trust Ltd UK and the Fenner Pension Scheme Trustee Limited was equal to zero at that date. For the Michelin Pension Trust Ltd, contributions are payable to the plan if the plan is underfunded. If the plan is overfunded, the contributions are deposited in an escrow account up to a certain level of overfunding, after which a contributions holiday is granted. When the amount in escrow exceeds a certain level, the local entity may apply for a refund. For Fenner UK Pension Scheme Trustee Limited, a contributions holiday is granted once a certain funding level is met. 32.2.2 Other contingencies In the normal course of business, the Group companies may be involved in administrative proceedings, litigation and claims. Although provisions have been recognized when the risks are established and an outflow of financial resources is probable, there exist uncertainties concerning some of these administrative proceedings, litigation and claims. In the opinion of Group management, there are no other governmental, judicial or arbitration proceedings likely to have a material impact on the Group's financial position or cash position.
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