Limited partnership

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Legal characteristics of French limited partnerships with shares

Lagardère is a French limited partnership with shares (société en commandite par actions - SCA) that has two categories of partners:

• two General Partners (Associés Commandités), who have joint, several and unlimited liability for the company's debts;
• Limited Partners (Associés Commanditaires or shareholders) whose liability, as for shareholders in a société anonyme (form of French limited liability company), as regards the company's losses, is limited to the amount of their contributions. The Limited Partners alone designate the members of the Supervisory Board, the General Partners being unable to participate in the voting.
  

Because of the two categories of partners, collective decisions require double consultation: that of the shareholders, in general meetings, and that of the General Partners.

The Company is managed under the supervision of the Supervisory Board which represents the shareholders, by the Managing Partners (Gérants).

The French limited partnership with shares (SCA): a modern structure that is perfectly adapted to the requirements of corporate governance

It makes possible an absolute separation of powers between the management bodies (General and Managing Partners) and the supervisory bodies (Supervisory Board).
No member of management can be a member of the Supervisory Board.

Lagardère SCA: an arrangement that maintains a balance between the rights of the General Partners and those of the shareholders

Lagardère SCA has adapted its by-laws to strengthen shareholders' rights by granting them specific powers:

• Right of veto over the appointment of the Managing Partners
  

The Supervisory Board, which represents the shareholders, must give its consent to the appointment of the Managing Partners by the General Partners.
The shareholders have the ultimate bargaining power in case of any disagreements between the General Partners and the Supervisory Board.

• Approval in case of a change of control of Arjil Commanditée-Arco (General and Managing Partner).
  

The Supervisory Board must give its prior agreement to:
- any sale or issue of shares leading to a change of control of Arjil Commanditée - Arco (except in the case of a valid takeover bid for all the Company's shares);
- any new shareholder in this company.

Furthermore, Lagardère SCA encourages the management bodies to run the Company in a responsible and careful manner with a long-term perspective, since the Managing Partners are also General Partners, and thus have unlimited liability for the Company's debts.