LOREAL_Registration_Document_2017

Annual General Meeting STATUTORY AUDITORS' REPORTS

STATUTORY AUDITORS' REPORTS 7.2.

SPECIAL REPORT BY THE STATUTORY AUDITORS ON THE REDUCTION IN SHARE 7.2.1. CAPITAL BY CANCELLATION OF PURCHASED SHARES (Ordinary and Extraordinary Annual General Meeting of April 17, 2018 – Thirteenth resolution)

To the Shareholders, In our capacity as Statutory Auditors of your Company and in accordance with articles L.225-204 and L.225-209 of the French Commercial Code ( Code de commerce ), which apply in the event of a share capital reduction by cancellation of shares purchased by a company, we hereby report to you on our assessment of the reasons for and terms and conditions of the planned share capital reductions. We performed the procedures that we deemed necessary in accordance with the professional standards applicable in France to such engagements. Those standards require that we ensure that the reasons for and terms and conditions of the planned share capital reductions, which are not considered to affect shareholder equality, comply with the applicable legal provisions. Reduction of share capital by cancellation of shares purchased by the Company in accordance with article L.225-214 of the French Commercial Code The proposed capital reduction relates to the cancellation of the Company’s shares purchased under conditions set forth in article L.225-208 of the French Commercial Code. The Board of Directors invites you to delegate, for a period of 26 months as of the date of this Annual General Meeting, the authority to cancel, on one or more occasions, a maximum number of 771,125 shares purchased by your Company pursuant to article L.225-208 of the French Commercial Code to cover share purchase options which currently correspond, or will correspond in the future, to options that are no longer exercisable. We have no matters to report on the reasons for and the terms and conditions of this transaction, which will reduce the Company's share capital by a maximum amount of €154,225. Reduction of share capital by cancellation of shares purchased by the Company in accordance with article L.225-209 of the French Commercial Code The Board of Directors invites you to delegate, for a period of 26 months as of the date of this Annual General Meeting, the authority to cancel, on one or more occasions, with a maximum limit of 10% of the share capital as of the date of the cancellation, and within a given period of 24 months, shares purchased pursuant to an authorization for the Company to purchase its own shares in accordance with article L.225-209 of the French Commercial Code. The authorization to purchase shares is submitted for the approval of the Annual General Meeting under the twelfth resolution and would be granted for a period of 18 months. We have no matters to report on the reasons for and the terms and conditions of the proposed capital reduction.

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Neuilly-sur-Seine, February 20, 2018 The Statutory Auditors

PricewaterhouseCoopers Audit Gérard Morin

Deloitte & Associés Frédéric Moulin

REGISTRATION DOCUMENT / L'ORÉAL 2017

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