Eurazeo / 2019 Universal Registration Document

Financial Statements Consolidated Financial Statements for the year ended December 31, 2019

Co-investment bytheManagement 16.19 teams of investments On the acquisition of certain investments,Eurazeo agreed to share its investment profits and risks with the management of each entity acquired. The executives concerned are accordingly invited to invest large sums relative to their personal assets, alongside Eurazeo. The financial instruments concerned are subscribed at fair value as determined by conventional models, appropriate for the instruments concerned. Gains from each investment are contingent on Eurazeo achieving a certain return on its own investment. They are therefore high-risk investmentsfor the executives concerned since the sums invested by them can be partially or entirely lost if that return is not attained. Eurazeo's obligation, on the other hand, is generally limited to retroceding a portion of any capital gains on the shares concerned (above and beyond the minimum return originally set) when they are sold or in the eventof an IPO. The right to any capital gains will accrue to recipients within a time frame that varies from investment to investment. Consequently, this future dilution, which is only recognized on the investment exit date, is reflected by a capital gain reduced in the amount of the investmentallocated to managers. It should also be noted that Eurazeo's commitment to the managementof subsidiariesgenerallybenefits the persons concerned only if the shares are sold or offered to the public. Hence, Eurazeo has an unconditional right to avoid delivering financial assets to settle its obligations under such arrangements,and these financial instruments are accounted for as equity instruments. Nevertheless, in certain specific cases, Eurazeo has made a commitment to buy back from executives their shares of the company issuing these financial instruments. In this case, a liability is recognized in the amount of the contractual obligation. In line with standard investment fund practice, Eurazeo has created a “co-investment”mechanism for the members of the Executive Board and teamsinvolved in the investments(“the beneficiaries”). In the PME strategy, Eurazeo invests through investment funds in which members of the Executive Board and investment teams are co-investors. In accordance with market practice and prevailing regulations, Eurazeo and its investment teams hold a separate class of shares with different rights to capital gains and income generated by the fund. These rights are defined in the fund rules (filed with the AMF). The so-called carried shares purchased by the teams confer equivalentfinancial rightsto those describedbelow forEurazeoSE. In the Eurazeo strategy, for investments performed after January 1, 2012, this mechanism was structured around a variable capital company grouping together Eurazeo (95% of the share capital) Co-investment contracts 16.20 for members ofthe ExecutiveBoard and investment teams

and private individual investors (holding the remaining5% of the share capital). This company participates in each investment performed by Eurazeo in the amount of 10% (12% from June 2017: CarryCo Capital 2, CarryCoPatrimoine 2 and CarryCoBrands). investments performed between January 1, 2012 and December 31, 2013 and any additions, the entity is called CarryCo Croissance. For investments performed since January 1, 2014, there are different entities for each division (CarryCo Capital 1, CarryCo Croissance 2, CarryCo Patrimoine, CarryCo Capital 2, CarryCo Patrimoine 2 and CarryCoBrands). Within each CarryCo, an agreementwas signed between Eurazeo and the private individual investors stipulating that the private individual investors can only recover their investment after Eurazeo has recoveredits investmentin full and that private individualinvestorswill only receive the full capital gain earned by the CarryCo after Eurazeo has received an overall minimum annual return of 6% (the “hurdle”). These thresholds and capital gains are calculated, as appropriate, either (i) by aggregatingthe investmentsperformedunder the relevant program, or (ii) by allocatingthem50% to the observedperformanceof each individual investmentand 50% to all investmentsof the relevant period. Under the relevant investment programs, the beneficiaries acquire their rights either immediately or progressively, provided they are still in office at the scheduled anniversary dates. The right to any capital gains will be settled by Eurazeo at a given date or in the event of a change incontrol of Eurazeo. The amounts invested by the Executive Board and the investment teams are recognized in liabilities. The liability value includes any commitment by Eurazeo to repurchase from beneficiaries their rights in accordance with any contractual termination or liquidation clauses and the portion payable to beneficiaries at the end of the plan in respect of net realized capital gains, once the probability that the 6% hurdle will be attainedis high. Capital gains on disposals recognized by Eurazeo are accounted for net of any portion due to beneficiaries, once the probability that thehurdlewill be attained ishigh. Earningsper share 16.21 Basic earnings per share is calculated by dividing net income attributable to owners of the Company by the weighted average number of shares outstanding during the period, excluding the averagenumber of repurchasedshares heldas treasury shares. Diluted earnings per share is calculated based on the weighted average number of shares, as measured by the share buyback method.This methodassumesthat existingshare subscriptionoptions with a dilutive impact will be exercised and that Eurazeo will buy back its shares at their current price for an amount corresponding to the cash received as consideration for the exercise of the options, plus stock optionscosts still tobe amortized. Earningsper share for prior years are adjustedaccordinglyin the event of a stock splitor a distribution of bonusshares. For

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