EURAZEO_REGISTRATION_DOCUMENT_2017

3 GOVERNANCE

Risk management, internal control and main risk factors

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. No amounts were called or paid in 2017. Gilbert Saada Gilbert Saada initiated a legal action against the Company before the Paris District Court (Tribunal de Grande Instance of Paris) on May 23, 2011, notably for the purpose of appointing an expert to value the equity of the Company and on this basis to determine the average valuation of the amounts potentially due to him under the co-investment program. The Company has disputed those claims, and the Court fully dismissed Mr. Saada’s suit on July 6, 2011. On August 31, 2011, the Company received, at the request of Mr. Saada, a summons to appear before the Conciliation Board of the Paris Industrial Court concerning the conditions of Mr. Saada’s dismissal. A hearing was held on January 18, 2012, during which the Court noted the absence of conciliation between the parties. The Paris Industrial Court, in a ruling dated December 11, 2012, declared that it had no jurisdiction in this matter, and dismissed all claims by Gilbert Saada. Mr. Saada appealed this ruling. On June 9, 2015, the Paris Appeal Court confirmed this ruling and dismissed Gilbert Saada’s new claims. Mr. Saada’s filed an appeal which was dismissed in full by the Labor Chamber of the Court of Cassation in an order dated February 1, 2017. Delphine Abellard On December 28, 2016, Delphine Abellard initiated a legal action against Eurazeo before the Paris District Court claiming compensation for losses suffered under the 2005-2008 co-investment program led by 4i Bingen. The initial claim of €200,000 was increased to around €3 million in February 2018. It is recalled that Eurazeo managers participating in this co-investment program lost their investment in accordance with applicable contractual terms, as the Eurazeo hurdle was not attained. Eurazeo considers these claims to be unfounded. General comment Certain of the above disputes are provided in the Eurazeo financial statements for the year ended December 31, 2017 (see Note 7 to the Company financial statements). To Eurazeo’s knowledge, there are no governmental, judicial or arbitration procedures underway or pending that could have, or have had in the last 12 months, material impacts on Eurazeo’s and/or the Group’s financial positions or profitability. Eurazeo cannot rule out future claims or disputes stemming from events or facts that are currently unknown or which present associated risks that cannot yet be identified and/or quantified. Such cases could potentially have an adverse impact on the Company’s financial position or earnings.

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. Given the close links between the criminal and civil aspects of this case, the Industrial Tribunal granted ANF Immobilier’s request for a stay of proceedings. The Marseilles Criminal Court issued a judgment on July 4, 2017 dismissing the charges. ANF Immobilier filed an appeal against the civil provisions of the judgment. 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 and his lawyer. 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. The Court is expected to issue a decision on whether the proceedings are time barred in March 2018. If the Court finds the proceedings are time barred, the claims filed by Mr. Toti, dating from 2006, will lapse. If the Court finds the proceedings are not time barred, ANF will immediately file an appeal.

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2017 Registration document

Eurazeo