2025 Universal Registration Document

8. General Meeting

Seventeenth resolution: authorisation granted to the Board of Directors to reduce the share capital by cancelling the shares acquired by the Company under Article L. 22-10-62 of the French Commercial Code

The General Meeting, voting in accordance with the quorum and majority conditions required for Extraordinary General Meetings, having reviewed the Reports of the Board of Directors and the Statutory Auditors, authorises the Board of Directors, in accordance with Article L. 22-10-62 of the French Commercial Code, to cancel, on one or more occasions, all or some of the shares held by the Company under Article L. 22‑10-62 of the French Commercial Code, subject to a limit of 10% of the share capital existing on the date of cancellation per twenty-four month periods.

Full powers are granted to the Board of Directors, with the ability to delegate, to:

  • carry out a reduction in share capital by a cancellation of shares;
  • determine the final amount of the capital reduction;
  • set the terms and conditions and record completion;
  • deduct the difference between the carrying amount of the shares cancelled and their nominal amount from the available reserves and premiums;
  • amend the Articles of Association accordingly; and
  • more generally, carry out all formalities and do everything necessary for the implementation of this resolution.

This authorisation is granted for a duration of twenty-six months from the date of this General Meeting and renders ineffective from that day onwards the unused portion of any prior authorisation for the same purpose.

Resolution 18: Authorisation granted to the Board of Directors to carry out free grants of existing shares and/or shares to be issued, with cancellation of shareholders’ preferential subscription rights, to employees and directors and corporate officers
EXPLANATORY STATEMENT

It is proposed that the General Meeting renew its authorisation to carry out free grants of shares to Group employees and certain corporate officers which will expire in June 2026.

Under the scope of this authorisation, the number of free shares that may be granted may not exceed 0.6% of the share capital on the date of the Board of Directors’ decision. The total number of free shares granted to the corporate officers during a financial year may not represent more than 10% of the total number of free shares granted during this same financial year.

Pursuant to Article L. 225-197-1 of the French Commercial Code, the free grant of shares to their beneficiaries will become final and binding subject to the satisfaction of the other conditions set at the time of the grant, and specifically the employment condition, for all or part of the shares granted:

  • either after a minimum vesting period of two years, and in this case, without a minimum holding period;
  • or after a minimum vesting period of one year, it being stated that the beneficiaries must then hold these shares for a minimum of one year from their final allocation.

In all cases, the Board of Directors proposes that the vesting and holding periods should be a minimum of four years. The Board of Directors shall have the power, in all cases, to provide for vesting periods which are longer than the minimum periods set above or to provide for a holding period.

If the General Meeting approves this resolution, any free grant of shares shall be decided by the Board of Directors on the basis of the proposals made by General Management and reviewed by the Human Resources and Remuneration Committee.

The Board of Directors will decide the identity of the beneficiaries of the grants, the number of shares allocated to each one and the performance conditions to be met for the final vesting of all or part of the shares.

Since the 13 October 2022 plan, the Board of Directors, on the recommendation of the Human Resources and Remuneration Committee, decided to introduce criteria for non-financial performance in addition to financial performance within the long-term remuneration plan, in order to align them with L’Oréal’s strategy in which economic performance and environmental and social performance go hand-in-hand.

These performance conditions take into account:

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

The figures recorded each year to determine the levels of performance achieved are published in the Annual Financial Report included in the Universal Registration Document.