SOLOCAL_Registration Document_2017

CORPORATE GOVERNANCE 4.2 Functioning of the Board and the Committees

The Board of Directors’ work mainly involved: changes in governance: The Board of Directors, relying on the l Remuneration and Appointments Committee, has set up a search and selection process for its new Chair and new Chief Executive Officer, and has renewed many of its appointments; financial restructuring: the Board of Directors met many times l to review, prepare, and implement the financial restructuring plan; review of financial accounts and results: the Board reviewed and l approved Company and consolidated annual and semi-annual accounts and management reports. It examined quarterly revenue and key income figures and the associated financial communication. It prepared the reports and draft resolutions for General Shareholders’ Meetings; review of business performance: at each Board meeting, senior l management reported on business conditions and results, which enabled Directors to keep close track of the Group’s business activity “in real time”; review of strategy: business unit managers regularly gave l presentations of a specific Group business to the Board. The Board examined the strategic plan, discussed it at length and approved it; corporate social responsibility (CSR): the Board of Directors is l informed of the market trends, the competitive environment, and the major issues including those of the Company’s environmental and social responsibility. 4.3. BOARD OF DIRECTORS COMMITTEES The Board of Directors has created three Committees within the Company, namely an Audit Committee, a Remuneration and Appointments Committee, and a Strategy Committee, with this latter created by the Board of Directors at its meeting on 13 June 2017. The Board of Directors, at its meeting of 9 November 2017, also created three Ad Hoc Committees on refinancing, the equity story, and the monitoring of the Company’s restructuring. 4.3.1. Audit Committee The Audit Committee must have at least two members, which are appointed by the Board of Directors on the Chairman’s recommendation. Pursuant to its charter, the Audit Committee designates its own Chairman. As of the date of this document, the Audit Committee was

The Audit Committee monitors all matters that have to do with the preparation and auditing of accounting and financial information. Without prejudice to the powers of the administrative, management and supervisory bodies, it is responsible for the following, in particular: monitoring the preparation of financial information, specifically: l reviewing Company and consolidated draft annual and l semi-annual financial statements and draft management reports and sales and earnings tables, reviewing financial communication documents, l ensuring that Company and consolidated financial statements l comply with the accounting standards adopted, reviewing the accounting treatment of specific transactions l and the corresponding disclosures, checking the quality and relevance of the information l communicated to shareholders; monitoring the effectiveness of internal control and risk l management systems, in particular: checking that internal data collection and control procedures l are complied with, reviewing the procedure for selecting the Company’s Statutory l Auditors, particularly their choice and their terms of remuneration for the purpose of making observations, reviewing the annual audit programmes proposed by the l statutory and internal auditors, examining the internal auditing reports for the past year and preparing the audit engagement programme for the current year, each year, assessing the Group’s exposure to risks and in l particular to financial and litigation risks, significant off-balance sheet commitments and the effectiveness of the internal control system, the Statutory Audit of the annual Company, and if applicable l consolidated, accounts, monitoring the independence of the Statutory Auditors, l giving its opinion on the Statutory Auditors proposed for l appointment at the General Shareholders’ Meeting, reporting regularly on its work to the Board of Directors and l informing it immediately of any difficulty encountered. These duties do not limit the powers of the Board of Directors, which cannot rely on the duties or opinions of these Committees to reduce its responsibility. The Audit Committee shall meet as often as it deems useful and shall address any matter that falls within its remit. It may ask the Company to provide it with any document or information it needs to carry out its duties and conduct any internal or external audit on any matter, it believes is pertinent to these duties. When reviewing annual and semi-annual draft financial statements, the Committee may question the Statutory Auditors in the absence of the Company’s senior executives. The Audit Committee must be notified of any accounting or auditing irregularity.

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composed of the following members: Ms Sandrine Dufour, Chairwoman; l Mr Jacques-Henri David; l

Mr Arnaud Marion; l Ms Sophie Sursock. l Therefore, 100% of its members are Independent Directors.

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2017 Registration Document SOLOCAL