French Commercial code
In forceI. - During the period of a takeover bid for a company whose shares are admitted to trading on a regulated market, the Board of Directors or the Management Board, with the authorisation of the target company's Supervisory Board, may take any decision the implementation of which is likely to cause the bid to fail, subject to the powers expressly granted to General Meetings within the limits of the company's corporate interests.
II. - Without prejudice to other measures permitted by law, the Extraordinary General Meeting of the target company, ruling under the quorum and majority conditions provided for in Article L. 225-98, may decide to issue warrants entitling the holder to subscribe, on preferential terms, for shares in the said company, and to allocate them free of charge to all shareholders in the said company who have this status before the expiry of the public offer period.
The General Meeting may delegate this authority to the Board of Directors or the Management Board. It sets the maximum amount of the capital increase that may result from the exercise of these warrants and the maximum number of warrants that may be issued.
The delegation may also provide for the setting of conditions relating to the obligation or prohibition, for the Board of Directors or the Management Board, to proceed with the issue and free allocation of these warrants, to postpone or waive them. The target company shall inform the public of its intention to issue these warrants before the offer closes.
The terms of exercise of these warrants, which must relate to the terms of the offer or any competing offer, as well as the other characteristics of these warrants, including the exercise price or the methods for determining this price, are set by the General Meeting or, on delegation of the latter, by the Board of Directors or the Management Board. These warrants shall automatically lapse as soon as the offer and any competing offer fail, lapse or are withdrawn.
