Eurazeo / 2018 Registration document

GOVERNANCE Risk management, internal control and main risk factors

Risks relating to the impairment of certain 3.4.2.10.6 intangible assets As part of the allocation of the purchase price of acquired companies or groups, significant amounts can be recognized in the consolidated balance sheet in respect of goodwill and certain other intangible assets, the estimated useful life of which is indefinite (mainly brands). As of December 31, 2018, the net value of goodwill and intangible assets with indefinite useful lives was €3,221 million and €494 million, respectively. In accordance with the accounting methods used by Eurazeo, these assets are not amortized; they are tested for impairment at least annually and whenever events or circumstances indicate that impairment may have occurred. An unfavorable change in business forecasts or the assumptions used for projecting future cash flows in the impairment tests may result in the recognition of significant impairment losses. The business plans of investments used in the impairment tests are established on the basis of management's best estimate of the impact of the current economic situation. Sensitivity to changes in the different assumptions is analyzed for each cash-generating unit (CGU). The key assumptions underlying the impairment tests and sensitivity analyses are described in Note 6.4 to the consolidated financial statements (page 239). Proceedings are currently underway following the dismissal and subsequent layoff of ANF Immobilier's Chief Executive Officer, Philippe Brion and its Real Estate Director, Caroline Dheilly, in April 2006: the dismissed employees have filed damage claims with the Paris • Industrial Tribunal (Conseil des Prud'hommes). The former Chief Executive Officer is seeking €4.6 million (of which €3.4 million from ANF Immobilier and €1.2 million from Eurazeo) and the former Real Estate Director is seeking €1.0 million; the former Chief Executive Officer has also brought a suit against • ANF Immobilier before the Paris Commercial Court, in his capacity as a former corporate officer. Prior to the filing of these Industrial and Commercial court proceedings, ANF Immobilier lodged a complaint with an investigating magistrate (juge d'instruction) in Marseilles. It launched a civil suit pertaining to acts allegedly committed by the above-mentioned former supplier, as well as the two former Directors and other individuals. During the criminal investigation, the police in Marseilles were tasked with gathering evidence. ANF Immobilier's former Chief Executive Officer and Real Estate Director have each been indicted and placed under judicial control. On March 4, 2009, the judicial investigation office (chambre de l'instruction) of the Court of Appeal in Aix-en-Provence handed down a ruling confirming the validity of the indictment of ANF Immobilier's former Chief Executive Officer and, hence, the existence of serious evidence that corroborated claims that he misused company assets to the detriment of ANF Immobilier. In March 2015, the Public Prosecutor requested the transfer of the case before the criminal court. The Marseilles Criminal Court issued a judgment on July 4, 2017 dismissing the charges. The Court of Appeal in Aix en Provence confirmed the civil provisions of this judgment on June 27, 2018 and Litigation 3.4.2.11 ANF Immobilier Chief Executive Officer and Real Estate Director

dismissed the claims of all parties. An appeal filed by ANF Immobilier is pending before the Court of Cassation. At the end of 2018 and the beginning of 2019, Mr. Brion and Mrs. Dheilly reintroduced their claims before these courts. Their updated claims amount to approximately €4.3 million. In addition, Mr. Brion filed a new claim before the Paris District Court against Icade (as successor in interest to ANF Immobilier), Eurazeo and former executives and managers of ANF Immobilier, seeking a joint order to pay damages and interest of around €30 million. Pursuant to the sale to Icade of its investment in ANF Immobilier, Eurazeo granted Icade a number of warranties covering these disputes in consideration for rights over the follow-up of such disputes on behalf of ANF Immobilier. TPH-TOTI case As successor in interest to Eurazeo, ANF Immobilier hired a private contractor, Philippe Toti (TPH), to renovate some of the properties in its real estate portfolio in Marseilles. Just as criminal proceedings were being brought before the Marseilles investigating magistrate, in particular against ANF Immobilier's former supplier for receiving stolen goods and collusion, ANF Immobilier became aware that the latter had not provided the material and human resources required to fulfill his contractual obligations. A bailiff engaged by ANF Immobilier reported that work on the building sites had ceased. Following this report, ANF Immobilier terminated its construction contract with its former supplier on June 19, 2006. Separately, the former supplier and his company's liquidator issued ANF Immobilier with a summons to appear before the Paris Commercial Court on February 16, 2007. ANF Immobilier requested that proceedings be suspended or deferred until an unspecified date pending the final ruling in the civil suit brought by ANF Immobilier before the criminal court (Marseilles District Court) in which it accused the entrepreneur Mr. Toti of receiving stolen goods and misuse of company assets. On December 3, 2009, the Paris Commercial Court deferred the proceedings until a future date at the request of the parties but did not issue a stay of proceedings. In November 2017, the case was reintroduced, probably at the initiative of Mr. Toti. ANF Immobilier filed a claim that the case is time barred as no procedural acts have been performed since removal of the case from the register in 2012. This issue is pending before the Paris Court of Appeal and the hearings will be held in 2019. Groupe B&B Hotels B&B Hotels is involved in several disputes with certain of its former managing agents, who are requesting that their management contracts be requalified as employment contracts. Groupe B&B Hotels disputes these claims, which are currently under investigation. Pursuant to the sale of Groupe B&B Hotels, Eurazeo and the other sellers accepted under certain conditions to continue to bear part of the damages potentially arising as a result of these disputes and similar disputes that could arise in the future. A cap was set on the total amount of damages payable by sellers and split among them. This vendor warranty only covers requests submitted by the buyer of Groupe B&B Hotels before March 31, 2012. €263,553 was called and paid in 2017.

202

Eurazeo

2018 Registration Document