2025 Universal Registration Document

50% of the performance shares granted to the Chief Executive Officer, with a four-year vesting period, are subject to a further holding period of two years.

This holding period still applies in the case where the beneficiary ceases to be Chief Executive Officer before the end of the holding period.

If the beneficiary continues to exercise his function as Chief Executive Officer beyond the end of the holding period, he will be required to hold his shares in registered form until the termination of his duties in accordance with section (II) of Article L. 225-197-1 of the French Commercial Code.

The value of these shares, estimated at the grant date in accordance with IFRS as applied for the preparation of the consolidated financial statements, represents approximately 50% of the executive corporate officer's annual remuneration and may not exceed 60%.

In view of observations by L'Oréal's main investors and by proxy advisors, on the recommendation of the Human Resources and Remuneration Committee, the Board of Directors decided to remove the possibility to decide on an additional grant of performance shares if a particular event justified it.

The executive corporate officer formally undertakes not to enter into any risk hedging transactions with regard to the

performance shares until the end of the holding period set by the Board of Directors.

An executive corporate officer may not be granted performance shares at the time of his or her departure.

Performance conditions

The performance criteria cover all shares granted to the executive corporate officer.

They take into account:

• in part, criteria for financial performance based on:
  • growth in L'Oréal's comparable cosmetics sales compared to a panel of L'Oréal's major direct competitors;
  • change in L'Oréal's consolidated operating profit;
• in part, criteria for non-financial performance based on:
  • fulfilment of environmental and social responsibility objectives defined by the Group as part of the L'Oréal for the Future programme (hereinafter "L'Oréal for the Future Objectives"):
    •  % of renewable energy use on operated sites and stores⁽¹⁾.
    •  % of all materials used in product packaging either from recycled or biobased sources,
    •  % of recycled or reused water in industrial purposes in factories.
  • gender balance within strategic positions including the Executive Committee.

The Board of Directors considers that both these types of criteria, assessed over a period of three full financial years and reapplied to several plans, are complementary, in line with the objectives and specificities of the Group and likely to promote continuous, balanced and sustainable long-term growth. They are exacting but remain a source of motivation for the beneficiaries.

The shares are only fully vested at the end of a four-year period, allowing sufficient time to be able to assess the performance achieved over three full financial years.

DETAILS OF WEIGHTING OF CRITERIA FOR GRANTING PERFORMANCE SHARES