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Combined General Shareholders’ MeetingJune 8, 2011 - CNIT La Défense, Paris
Disclaimer
1
This presentation contains certain statements that constitute "forward-looking statements",
including but not limited to statements that are predictions of or indicate future events,
trends, plans or objectives, based on certain assumptions and include any statement which
does not directly relate to a historical fact or current fact. Such forward-looking statements
are based on management's current expectations and beliefs and are subject to a number of
risks and uncertainties that could cause actual results to differ materially from the future
results expressed, forecasted or implied by such forward-looking statements. For a more
complete list and description of such risks and uncertainties, refer to Technicolor’s filings with
the French Autorité des marchés financiers.
Introduction & GovernanceDenis Ranque - Chairman of the Board of Directors
3
Governance – Denis Ranque
Strategic Roadmap & Business Update – Frédéric Rose
Financial Update 2010 – Stéphane Rougeot
Compensation of the Chief Executive Officer and LTIP – Denis Ranque
Resolutions – Delphine Abellard
Statutory Auditors’ Reports
Questions – Answers
Vote
General Shareholders’ Meeting June 8, 2011
Board of Directors’ Activities in 2010 (1/2)
4
Full review of the Board of Directors’ composition in February 2010 9 members 7 of whom are independent Directors
Separation of the functions of Chairman of the Board and Chief Executive Officer
Modification of the composition of the Board of Directors’ Committees, adoption of new Internal Board Rules and Committee Charters
Induction sessions for new Board members
Self-evaluation of the performance of the Board of Directors, the Audit Committee, and the Remuneration, Nomination and Governance Committee
13 meetings in 2010, with an average participation rate of 90.7%
Board of Directors’ Activities in 2010 (2/2)
5
Continuation of its work in connection with the financial debt and its restructuring
Review of the implementation of the disposal program (review of offers from potential buyers and approval of the disposals of Screenvision U.S. and the Grass Valley businesses)
Definition and follow-up of the strategy of the 3 business segments
Follow-up of the Group’s operational performance and corresponding action plans
Definition of Incentive Plans for Management and key Group employees
Audit Committee’s Activities in 2010
6
Financial information Review of the financial statements, notes to the financial statements, and critical
accounting policies
Review of the impairment tests on goodwill and assets
8 meetings in 2010, with a participation rate of 100%
Situation of indebtedness and liquidity position Review of procedures implemented by the Group to monitor and forecast cash position
Review of the procedures implemented by the Group for compliance with the commitments taken with respect to the Reinstated Debt and the Sauvegarde Plan
Risks and Internal Audit Review of general framework of risk management and detailed examination of certain risks
Review of internal audit plans and their results
Review of internal control procedures
Technology Committee’s Activities in 2010
7
Review of organization of Research and Innovation activity and of main ongoing research programs
First meeting took place in 2010
Review of the various technology programs launched in the Digital Delivery segment “Excellence”
“Operational framework”
“Revolution”
Review of the plan to open a new research center in Palo Alto, California
Remuneration, Nomination and Governance Committee’s Activities in 2010
8
Review and definition of the compensation of the Chairman and the Chief Executive Officer
5 meetings in 2010, with a participation rate of 100%
Definition of the mid-term incentive management plan implemented in June 2010
Review of the process for evaluating the functioning of the Board of Directors and its Committees as well as the results of this evaluation
Review of the composition and activities of the Board of Directors
Strategic Roadmap & Business UpdateFrédéric Rose - Chief Executive Officer
Past 12 Months Achievements
10
Business Achievements
Key customer wins
Market share gains
Organic sales growth since Q3 2010
Innovation & new products/services
Financial Performance
Balance sheet restructuringcompleted
Disposal program closed
Increase in Operating Cash Flow
Debt rating upgrades
Trends in Technicolor Markets in Past 12 Months
11
Growth in movie box office driven primarily by 3D
Resilient content production market and consumer spending in home entertainment
Acceleration of conversion of theatres to digital cinema
Recovery in advertising markets
Strengthening in global consumer electronics volumes
Rapid Innovation in the digital home and content consumption
Businesses Overview
* EBIT from continuing operations plus depreciation and amortization, excluding impairments charges, restructuring and other income and expenses
Services for content production and distribution
Hardware & software technologies for delivery platforms
Intellectual Property Licensing
CE Manufacturers
ENTERTAINMENT SERVICES DIGITAL DELIVERYTECHNOLOGY
2010 Revenues and Adjusted EBITDA* margin
€1,697m │12.8% €1,423m │ 3.9%€450m │ 72.7%
Activities
Markets
Key Comparable Key Competitors
Key Clients
12
Managing Shift in Technicolor Business Mix
13
Notes: Graph not to scale(1) Corresponds to Connect businesses(2) Digital Content Delivery Services(3) Postproduction Services, PRN
LICENSING
DIGITAL HOME (1)
DVD
DIGITAL PRODUCTION and DIGITAL
CINEMA DISTRIBUTION
13%
40%
47%
(2)
FILM (3)
Total 2010 Revenues: €3,574mCapture Growth From Digital Expansion Thanks to Research & Innovation
Expand Licensing activity
Grow Digital services
Maximize Value From Leading Positions
Maximize value from leadingDVD/Blu-ray™ and photo-chemical film positions
Research & Innovation
14
100+ publications in 2010
170+ research students hosted in 2010
New research lab in Palo Alto, California
Key technology transfers to the business including 3D technologyand VFX algorithms
Patent Portfolio
15
Over 70% of patents have a lifetime greater than 10 years
0%5%
24%
0%
20%
40%
60%
80%
100%
2011 2012-2016 2017-2021
% of cumulated expired patents(1)
Note: (1) On the basis of the portfolio of patents as of 28 February 2011 and excluding any future patent to be granted
Key Innovations
16
Digital Home
New solutions for the consumer addressing key NSP challenges
Media Consumption
Simplify and enhance the media consumption experience
Digital Home Software Suite
MediaEncore MediaNavi
Last 12 Months Business Achievements
17
Renewals / Extensions New Client Wins
Content Creation Highlights for the Last 12 Months
18
Feature Films Television
Animation Adverts
Priorities for 2011
19
Accelerate Investments To Drive Growth
Research investments related to content management and distribution platforms
Acceleration in software development in Digital Home
Increase capacity and software capabilities in Digital Production
Expand Digital Cinema distribution network
Achieve slight revenue growth at constant rates in 2011
Continued efforts on cost improvements and cash generation
Generate an Adjusted EBITDA in 2011 comparable or slightly up compared with 2010
Financial Update 2010Stéphane Rougeot - Chief Financial Officer
21
2010 key facts
Revenues Down (1.2)% YoY
Growth in H2 2010 nearly offset H1 2010 drop
Adjusted EBITDA Up €6m to €505m
Margin up 0.3 point to 14.1% of sales
Cash Flow Operating cash flow from continuing operations up €23m
Positive Group Free Cash Flow in H2 2010
Net Debt
Financial restructuring closed
Cash position of €332m
Net debt reduced by €1,181m
Upgrades in debt ratings
Disposal program closedDisposals
2010 revenues by segment
22
YoY change in revenues, €m
Technology
+15.0%
Strong growth in Consumer Electronic product shipments worldwide
Digital Delivery
(6.9)%
Impacted by restructuring and by less favorable overall mix vs. 2009
Entertainment Services
+6.6%
Market share gains in DVD and strong growth in Creation Services compensating volume drop in photochemical film
Other Exit of the retail telephony business at the end of 2009
3 6193 574
+59
+104 (106)
(102)
2009 Revenues
Technology Entertainment Services
DigitalDelivery
Other 2010 Revenues
Revenue trends
23
YoY quarterly change in revenues, %
H1 2010
(18.5)%
Licensing stable Drop in DVD volumes Pressure on Digital Delivery volumes
Q1 2011
+15.4%
Strong growth in Licensing Growth in all Entertainment Services activities except
photochemical film Growth in Digital Delivery volumes
H2 2010
+16.9%
Strong growth in Licensing Market shares gains in
Entertainment Services Recovery in Digital Delivery volumes
(25)%
(12)%
+12%
+21%+15%
Q1 10 Q2 10 Q3 10 Q4 10 Q1 11
2010 adjusted EBITDA
24
YoY change in adjusted EBITDA, €m
Technology
Margin of 72.7%+2.0 pts vs. 2009
Increase in Licensing revenues
Digital Delivery
Margin of 3.9%(4.2) pts vs. 2009
Maintained commercial and R&D efforts
Less favorable overall mix in Connect vs. 2009
Entertainment Services
Margin of 12.8%(1.0) pt vs. 2009
Impact of the non-recurring transition on-boarding costs for the Warner Bros. agreement
Other Exit of the retail telephony business at the end of 2009
499 506
+51
(2)
(68)
+26
Adjusted EBITDA 2009
Technology Entertainment Services
DigitalDelivery
Other Adjusted EBITDA 2010
13.8% margin
14.1% margin
38
156
(69)
+118 (225)
EBIT* Financial & tax
Profit from continuing operations
Loss from discontinued operations
Net result (Group share)
505
38
(271)(13)
(183)
2010*Adjusted EBITDA
D&A** Restruc-turing and
Other
Impairments EBIT*
2010 net result
Notes: * From continuing operations - ** Including impact of provisions for risks, litigations and warranties
€(61)m vs. 2009
Goodwill and fixed asset impairment charges for €(183)m, essentially related to photochemical film activities and to Digital Delivery
+€273m vs. 2009
Financial & tax: Gain of €246m mainly related to the debt
restructuring Foreign exchange loss of €(55)m Deferred tax income of €32m
Loss from discontinued operations including operational loss and disposal impact
25
Earnings before interest and tax (EBIT)*, €m
Net result (Group share), €m
505304
(165) (36)
2010Adjusted EBITDA
Net capitalexpenditure
Netrestructuring
OCF fromcontinuingoperations
304
(100)
(89)
(260)
(55)
OCF from continuing operations
Change in working capital
Financial, tax and other
non-current
FCF from discontinued operations
Group FCF
2010 cash flow
26
+€23m vs. 2009
Increased adjusted EBITDA from continuing operations
Higher capital expenditures, mainly driven by higher investments in DVD
Lower restructuring expenses
€(37)m vs. 2009
Negative impact of €(140)m in H1 2010 related to the closing of the restructuring and currency hedging instruments
Lower cash out on discontinued operations
Group Free Cash Flow, €m
Operating Cash Flow*, €m
Note: * From continuing operations
Net debt
27
Gross debt30 Jun. 10
1,692
DPN Repayment
Debt Reimbursement
Othersincl. forex
Gross debt31 Dec.10
(261)
Cash position
31 Dec. 09
Cash position
31 Dec. 10
416 332
Group FCF
+16
(30) (76)1 325
1,523 at Nominal
Value
IFRS impact*
1,922at Nominal
Value
DebtRestructuring
cash out
(22)
DebtReimbur-sement
(30)
Other cash outflow
(37)
Forex
(11)
Cash position
31 Dec. 09
Gross debt31 Dec.09
569
2,743IFRS impact*
Note: * Accounting impact of fair value adjustment of the Group’s reinstated debt
662 713
257103
435528
676
760
2,743 1,325
505
425 394
43690
569
332
652
819
605713
887 942
746 644
2009 2010 2009 2010
3,9344,320 3,934
(453)
Balance sheet at 31 december
28
In € million
Equity
Financial debt(ST & LT)
Other non-current liabilities
Trade payables
Liabilities held for sale
Other current liabilities
Goodwill
Tangible and intangible assets
Other non-current assets
Inventories and trade receivables
Cash and equivalents
Assets held for sale
Other current assets
LIABILITIESASSETS
4,320
Capital structure
29
27.0 m 52.7 m 50.0 m 45.2 m 174.9 m
End 2009 Rights issueDPN
repaymentNRS I
redemption End 2010
Share capital* evolution in 2010* Adjusted for 10:1 reverse split
Share capital including outstanding NRS redemption** Assuming the Company does not exercise its option to repay part or all of NRS IIC in cash
174.9 m 51.5 m 226.4 m
Currentshare capital
Share capital including outstanding NRS
Number of shares corresponding to outstanding NRS
30
Debt rating
Standard & Poor’s
From D to CCC-/Positive outlook in June 2010
From CCC- to CCC+/Positive outlook in October 2010
From CCC+ to B-/Stable outlook in March 2011
Moody’s From Caa3 to Caa1/Stable outlook in May 2010
From Caa1 to B3/Stable outlook in May 2011
31
Disposal program closed
Screenvision Disposal of the Group’s participation % in Screenvision US in October 2010
Grass Valley
Disposal of Broadcast activities closed at the end of 2010
Disposal of Transmission activities closed at the beginning of April 2011
Disposal of Head End activities closed at the beginning of May 2011
Compensation of the Chief Executive Officer and LTIPDenis Ranque – Chairman of the Board of Directors
Compensation of the Chief Executive Officer in 2010
33
Compensation Amounts paid in 2010 (in euros)
Fixed 800,000
Variable 400,000
Fringe Benefits 4,260
TOTAL 1,204 ,260
Exceptional bonus under Sauvegarde 600,000
Signing Bonus (2008) 150,000
215,570 stock options (MIP) 333,344 (Valuation as of 31/12/2010)
Long-Term Incentive Plan: 2011 – 2013 (1/2)
34
Beneficiaries : Chief Executive Officer: 13% 62 employees of the Group, including executives, division and transversal function leaders as well
as employees having a major role in the development of the Group
Granting of performance units: 1/3 in cash 2/3 in free shares (“performance shares”)
Performance criteria: 2/3 of the evaluation: Net Debt/EBITDA ratio
Stricter objectives than the corresponding financial covenants as set forth in the Company’s Reinstated Debt agreements
1/3 of the evaluation: stock exchange performance Comparison of Technicolor’s share price with the performance of approximately 20 securities listed in
North America, Europe and Asia representing the technology, media and telecom segments
Objective: To motivate and retain key employees and align theirs interests with those of the shareholders.
Long-Term Incentive Plan: 2011 – 2013 (2/2)
35
The Chief Executive Officer will commit to acquire, during the acquisition period, a number of Technicolor shares equivalent to €200,000
Issuance of performance shares is subject to the approval of the 14th resolution Maximum number of shares: 2.5 million
1.43 % of the share capital at the date of the present Shareholders’ Meeting 1.10 % of the share capital after redemption in shares of all of the NRS
In the absence of performance shares, these may be replaced by a cash component
Acquisition of performance units in 3 annual tranches (20%, 30% and 50% of the total number), subject to the achievement of the performance conditions
ResolutionsDelphine Abellard – General Secretary
Resolutions 1 to 3
37
ORDINARY SHAREHOLDERS’ MEETING
Approval of the parent Company unconsolidated financial statements for the fiscal year ended December 31, 2010
Approval of the consolidated financial statements for the fiscal year ended December 31, 2010
Allocation of income for the fiscal year ended December 31, 2010Net loss of €(499,508,008.12): this amount to be charged to the carry forward account
Resolutions 4 to 6
38
ORDINARY SHAREHOLDERS’ MEETING
Renewal of the terms of office of Directors for a three-year term:
Ms. Catherine Guillouard
Mr. Rémy Sautter
Mr. Loïc Desmouceaux
39
ORDINARY SHAREHOLDERS’ MEETING
Ms. Catherine Guillouard - 46 years old
Current functions Chief Financial Officer and member of the Executive Committee of
Eutelsat since September 2007
Main previous functions:At Air France: Chief Financial Officer (2005-2007) Senior Vice President for Human Resources and Change Management
(2003-2004) Senior Vice-President Flight Operations (2001-2003)
Other mandates: Member of the Supervisory Board of Atria Capital Partenaires
Education: She graduated from the IEP business school and the ENA – Gambetta
promotion (1991-1993) She holds a PhD (DESS) in European Union Law
Independent Director
Member of the Audit Committee
40
Chairman of the Remuneration,Nomination and Governance Committee
Vice Chairman of theBoard and Lead Independent Director
ORDINARY SHAREHOLDERS’ MEETING
Mr. Rémy Sautter - 66 years old
Current functions: Chairman of the Supervisory Board of Ediradio/RTL since 2000
Main previous functions: Chairman of the Board of FIVE (UK) (1999-2008) Chairman and Chief Executive Officer of Ediradio/RTL (2000-2002) Chief Executive Officer of CLT Multi Media and then of CLT-UFA Group
(Luxembourg) (1996-2000) Vice Chairman and Chief Executive Officer of Ediradio/RTL (1985-1996) Chief Financial Officer of Havas (1983-1985)
Other mandates:In France: Chairman and Chief Executive Officer of Société Immobilière Bayard d’Antin Member of the Supervisory Board of M6 Director of PagesJaunes, SERC/Fun Radio, Sodera/RTL 2, IP and IP RégionsOutside France: Director of Partner Reinsurance Ltd and TVI SA Belgique
Education: He graduated from the IEP business school and the ENA
41
ORDINARY SHAREHOLDERS’ MEETING
Mr. Loïc Desmouceaux – 48 years old
Current functions: Vice President Market Business Intelligence for Technicolor,
responsible for Employee Shareholding project Chairman of the Supervisory Board of FCPE Mutual Funds Technicolor
Gestion and Technicolor Epargne Vice President and Co-Founder of Technicolor Employee Shareholders
Society
Main previous functions: Various management positions within the Technicolor Group since 1988
Other mandates: Permanent representative of Sovemarco Europe S.A. on the Board of
Directors of Sellenium S.A; Permanent representative of Sellenium SA on the Supervisory Committee of YB Holding SAS
Director of Desamais Distribution SA
Education: He graduated from the IEP business school of Bordeaux and from the
École Supérieure de Commerce et d’Administration des Entreprises of Bordeaux
Non-Independent Director
Member of the Technology Committee
Resolution 7
42
ORDINARY SHAREHOLDERS’ MEETING
Authorization to allow the Company to purchase its own shares
Solely in connection with a liquidity program and subject to compliance with applicable legal conditions
Up to 10% of the Company’s share capital
The maximum purchase price of the shares : €15 per share
Until December 7, 2012 (18 months)
Resolutions 8 to 10: Financial delegations (capital increases)
43
EXTRAORDINARY SHAREHOLDERS’ MEETING
RESO # TYPE OF FINANCIAL DELEGATION DURATION AND DATE OF EXPIRY
MAXIMUM AMOUNT OF ISSUANCE OF EQUITY-
LINKED DEBT SECURITIES (IN EUROS)
MAXIMUM NOMINAL AMOUNTOF CAPITAL INCREASE
8th
Capital increase with preferential subscription rights through the issuance of shares and/or equity-linked securities giving access to the Company’s share capital
26 monthsAugust 7, 2013 500 millions
€87,423,312 50% of the share capital at the date of the
present Shareholders’ Meeting; 39% of the share capital after redemption
in shares of all of the NRS
9th
Capital increase, without preferential subscription rights and by a public offering, through the issuance of shares and/or equity-linked securities giving access to the Company’s share capital
26 monthsAugust 7, 2013 300 millions *
€34,969,325 20% of the share capital at the date of the
present Shareholders’ Meeting 15.5% of the share capital after
redemption in shares of all of the NRS
10th
Capital increase, without preferential subscriptionrights, through the issuance of shares and/orequity-linked securities giving access to theCompany’s share capital, within the frame of aprivate placement
26 monthsAugust 7, 2013 300 millions *
€34,969,325 20% of the share capital at the date of the
present Shareholders’ Meeting; 15.5% of the share capital after
redemption in shares of all of the NRS
*The ceilings of the 9th and 10th resolutions are common so that the use of one of these delegations will count towards the individual ceiling of the other delegation as well as towards the overall ceiling.
Resolutions 11 to 13: Financial delegations (capital increases)
44
RESO # TYPE OF FINANCIAL DELEGATION DURATION AND DATE OF EXPIRY
MAXIMUM AMOUNT OF ISSUANCE OF EQUITY-
LINKED DEBT SECURITIES (IN EUROS)
MAXIMUM NOMINAL AMOUNTOF CAPITAL INCREASE
11th
Increase of the number of shares to be issued in the event of a capital increase with or without preferential subscription rights up to 15% of the amount of the initial increase (Green shoe)
26 monthsAugust 7, 2013 N/A
Count towards the individual ceilings of the 8th, 9th and 10th resolutions
Count towards the overall ceiling stipulated in the 13th resolution
12th
Issuance of shares and/or equity-linked securities giving access to the Company’s share capital in consideration for contributions in kind granted to the Company
26 monthsAugust 7, 2013 N/A 10% of the share capital
13th Global limitations of the issuances under above delegations 500 million
€87,423,312 50% of the share capital at the date of
this Shareholders’ Meeting 39% of the share capital after redemption
in shares of all of the NRS
EXTRAORDINARY SHAREHOLDERS’ MEETING
Resolutions 14 to 16: Financial delegations (employees and executive officers)
45
RESO # TYPE OF FINANCIAL DELEGATION DURATION AND DATE OF EXPIRY
NUMBER OF SHARES THAT MAY BE ISSUED AND PERCENTAGE OF SHARE CAPITAL
14th
Grant of free shares to Company employees or certain categories of employees (Long-termManagement Incentive Plan for key Group employees)
38 monthsAugust 7, 2014
2,500,000 shares 1.43% of the share capital at the date of the present
Shareholders’ Meeting 1.10% of the share capital after redemption in shares of
all of the NRS
15th Increase of the share capital through issuances reserved to members of a group savings plan
18 monthsDecember 7, 2012
3,059,815 shares 1.75% of the share capital at the date of the present
Shareholders’ Meeting 1.35% of the share capital after redemption in shares of
all of the NRS
16thCapital increase reserved to certain categories of beneficiaries (Shareholding transactions for employees outside a savings plan)
18 monthsDecember 7, 2012
3,059,815 shares 1.75% of the share capital at the date of the present
Shareholders’ Meeting 1.35% of the share capital after redemption in shares of
all of the NRS
* The ceilings of the 15th and 16th resolutions are common so that the use of one of these delegations will count towards the individual ceiling of the other delegation as well as the global ceiling;
EXTRAORDINARY SHAREHOLDERS’ MEETING
Resolutions 17 to 18: Financial delegations (employees and executive officers)
46
RESO#
TYPE OF FINANCIAL DELEGATION DURATION AND DATE OF EXPIRY
NUMBER OF SHARES THAT MAY BE ISSUED AND PERCENTAGE OF SHARE CAPITAL
17th Grant share subscription or purchase options to employees and executive officers
38 monthsAugust 7, 2014
1,500,000 shares at the date of grant of the options 0.86% of the share capital at the date of the present
Shareholders’ Meeting 0.66% of the share capital after redemption in shares
of all of the NRS
18th Global limitations of the issuances under above delegations
3% of the share capital after redemption in shares of all of the NRS
EXTRAORDINARY SHAREHOLDERS’ MEETING
Resolutions 19 to 20
47
EXTRAORDINARY AND ORDINARY SHAREHOLDERS’ MEETING
Amendment of the bylaws of the Company in order to allow participation and voting at Shareholders' Meetings of the Company via telecommunications and electronic transmission
Powers to carry out all formalities
Statutory Auditors’ Reports For the year ended December 31, 2010
48
49
ORDINARY SHAREHOLDERS’ MEETING
Report on the Group consolidated financial statements
Report on the report prepared by the Chairman of the Board of Directors
Report on the Statutory financial statements of Technicolor SA
Special report on regulated agreements and commitments ("conventions et engagements réglementés" )
These reports are available in the company's annual report
50
Report on the Group’sConsolidated Financial Statements
OpinionIn our opinion, the consolidated financial statements present fairly in all material aspects the financial position of the Group. Without qualifying the above opinion, we draw your attention to the following notes to the consolidated financial statements:
– notes 1.2 and 3.1 which describe the impact of the financial restructuring as well as the reasons for applying the going concern assumption to approve the consolidated financial statements;
– notes 2.2. and 2.3 relating to the new standards effective as of January 1, 2010 and to the new interpretation IFRIC 19 “Extinguishing Financial Liabilities with Equity Instruments” which the Company has adopted on January 1, 2010 in advance of itseffective application date.
Justification of our assessmentsIn forming our opinion, we made our own assessments on the following items:
– the information on the group situation with regard to its ability to continue as a going concern.– estimates used for the valuation of goodwill, intangible assets, deferred taxes as well as retirement benefit obligation and provision
for risks and litigation.– the assumptions retained to determine the fair value of the debt and equity instruments issued on May 26, 2010.
Specific verificationsWe have no particular observation.
51
Report on the report prepared by the Chairman of the Board of Directors
ConclusionWe have nothing to report on the information in respect of the company's internal control procedures relating to the preparation and treatment of accounting and financial information contained in the report prepared by the Chairman of the Board of Directors.
52
Report on the Statutory Financial Statements of Technicolor SA
OpinionIn our opinion, the financial statements give a true and fair view of the assets and liabilities and of the financial position of the Company.
Without qualifying the above opinion, we draw your attention to notes 1.2 and 2 of the financial statements which describe the impact of the financial restructuring as well as the reasons for applying the going concern assumption to approve the financial statements.
Justification of our assessmentsIn forming our opinion, we made our own assessments on the following items:
– the information on the group situation with regard to its ability to continue as a going concern.– the valuation of the financial assets and provisions for losses and contingencies.– the methods used to account for the operations finalized on May 26, 2010 and the classification of the instruments
issued in the balance sheet.
Specific verifications and informationWe have no particular observation.
53
Special Report on regulated agreements and commitments
"conventions et engagements réglementés"
New regulated agreements and commitments submitted to the approval of the shareholders’ meetingWe were not provided with any agreement nor commitment entered into by the Companyduring the fiscal year to submit to the approval of the shareholders’ meeting.
Previous regulated agreements
Our report also presents a previously approved regulated agreement which did not have any effect during the fiscal year.
Shareholder Vote
Resolution 1
55
Board of Directors’ report and Statutory Auditors’ reports; approval of the parent Company unconsolidated financial statements for the fiscal year ended December 31, 2010.
ORDINARY SHAREHOLDERS’ MEETING
Resolution 2
56
Board of Directors’ report and Statutory Auditors’ reports; approval of the consolidated financial statements for the fiscal year ended December 31, 2010.
ORDINARY SHAREHOLDERS’ MEETING
Resolution 3
57
Allocation of income for the fiscal year ended December 31, 2010.
ORDINARY SHAREHOLDERS’ MEETING
Resolution 4
58
Renewal of the term of office of Ms. Catherine Guillouard as Director.
ORDINARY SHAREHOLDERS’ MEETING
Resolution 5
59
Renewal of the term of office of Mr. Rémy Sautter as Director.
ORDINARY SHAREHOLDERS’ MEETING
Resolution 6
60
Renewal of the term of office of Mr. Loïc Desmouceaux as Director.
ORDINARY SHAREHOLDERS’ MEETING
Resolution 7
61
ORDINARY SHAREHOLDERS’ MEETING
Authorization to be given to the Board of Directors to allow the Company to purchase its own shares. Solely in connection with a liquidity program and subject to compliance with applicable legal
conditions Up to 10% of the Company’s share capital Maximum purchase price of the shares : €15 per share Until December 7, 2012 (18 months)
Resolution 8
62
EXTRAORDINARY SHAREHOLDERS’ MEETING
Delegation of authority to the Board of Directors to approve a capital increase, with preferential subscription rights and by a public offering, through the issuance of shares and/or equity-linked securities giving access, immediately or in the future, to the Company’s share capital.
€87,423,312 50% of the share capital at the date of the present Shareholders’ Meeting 39% of the share capital after redemption in shares of all of the 500 million euros for the issuance of equity-linked debt Until August 7, 2013 (26 months)
Resolution 9
63
EXTRAORDINARY SHAREHOLDERS’ MEETING
Delegation of authority to the Board of Directors to approve a capital increase without preferential subscription rights and by a public offering, through the issuance of shares and/or equity-linked securities giving access, immediately or in the future, to the Company’s share capital.
€34,969,325 20% of the share capital at the date of the present Shareholders’ Meeting 15.5% of the share capital after redemption in shares of all of the NRS 300 million euros for the issuance of equity-linked debt securities Ceiling is common with that stipulated in the 10th resolution Until August 7, 2013 (26 months)
Resolution 10
64
EXTRAORDINARY SHAREHOLDERS’ MEETING
Delegation of authority to the Board of Directors to approve a capital increase, without preferential subscription rights, through the issuance of shares and/or equity-linked securities giving access, immediately or in the future, to the Company’s share capital, pursuant to an offering in accordance with Article L. 411-2 of the French Monetary and Financial Code.
€34,969,325 20% of the share capital at the date of the present Shareholders’ Meeting 15.5% of the share capital after redemption in shares of all of the NRS €300 million for debt issuances Ceiling is common with that stipulated in the 9th resolution Until August 7, 2013 (26 months)
Resolution 11
65
EXTRAORDINARY SHAREHOLDERS’ MEETING
Delegation of authority to the Board of Directors to increase the number of shares to be issued in the event of a capital increase with or without preferential subscription rights.
Up to 15% of the amount of the initial issuance Count towards the individual ceilings of the 8th, 9th and 10th resolutions Count towards the overall ceiling stipulated in the 13th resolution Until August 7, 2013 (26 months)
Resolution 12
66
EXTRAORDINARY SHAREHOLDERS’ MEETING
Delegation of authority to the Board of Directors to issue shares and/or equity-linked securities giving access, immediately or in the future, to the Company’s share capital in consideration for contributions in kind granted to the Company.
Up to 10% of the share capital at the moment of the issuance Until August 7, 2013 (26 months)
Resolution 13
67
EXTRAORDINARY SHAREHOLDERS’ MEETING
Overall ceilings on the amount of shares and securities issued under the 8th, 9th, 10th, 11th and 12th resolutions.
€87,423,312 50% of the share capital at the date of this Shareholders’ Meeting 39% of the share capital after redemption in shares of all of the NRS €500 million for the issuance of equity-linked debt securities
Resolution 14
68
EXTRAORDINARY SHAREHOLDERS’ MEETING
Authorization to the Board of Directors to grant free shares employees and executive officers of the Company or certain categories of such persons (Long-term incentive plan for key Group employees).
Maximum number of shares to be issued: 2,500,000 shares 1.43% of the share capital at the date of the present Shareholders’ Meeting 1.10% of the share capital after redemption in shares of all of the NRS Until August 7, 2014 (38 months)
Resolution 15
69
EXTRAORDINARY SHAREHOLDERS’ MEETING
Authorization to increase the share capital through issuances reserved to members of a group savings plan.
Maximum number of shares to be issued: 3,059,815 shares 1.75% of the share capital at the date of the present Shareholders’ Meeting 1.35% of the share capital after redemption in shares of all of the NRS Until December 7, 2012 (18 months)
Resolution 16
70
EXTRAORDINARY SHAREHOLDERS’ MEETING
Delegation of authority to the Board of Directors to proceed with a capital increase, with cancellation of shareholders’ preferential subscription rights, reserved to certain categories of beneficiaries (Shareholding transactions for employees outside a savings plan).
Maximum number of shares to be issued: 3,059,815 shares 1.75% of the share capital at the date of the present Shareholders’ Meeting 1.35% of the share capital after redemption in shares of all of the NRS Until December 7, 2012 (18 months)
Resolution 17
71
EXTRAORDINARY SHAREHOLDERS’ MEETING
Delegation of authority to the Board of Directors to grant share subscription or purchase options to employees or officers of the Company or companies related to it within the meaning of Article L. 225-180 of the French Commercial Code.
Maximum number of shares to be issued: 1,500,000 shares 0.86% of the share capital at the date of the present Shareholders’ Meeting 0.66% of the share capital after redemption in shares of all of the NRS Until August 7, 2014 (38 months)
Resolution 18
72
EXTRAORDINARY SHAREHOLDERS’ MEETING
Overall ceiling applicable to the 14th, 15th, 16th, and 17th resolutions.
3% of the share capital after redemption in shares of all of the NRS
Resolution 19
73
EXTRAORDINARY SHAREHOLDERS’ MEETING
Amendment of the bylaws of the Company in order to allow participation and voting at Shareholders’ Meetings via telecommunications and other electronic means.
Resolution 20
74
ORDINARY SHAREHOLDERS’ MEETING
Powers to carry out all formalities.
