marie brizard wine & spirits...of wines began in bulgaria followed in the next years by the...

1Part 1. Presentation of the GrouPreGistration document

registration document

2014

Marie Brizard Wine & SpiritS

registration document 2

Pursuant to its general regulations, and specifically to Article 212-13, the French Financial Markets Authority (the “AMF”) registered this Registration Document on 14 october 2015 under number R.15-074 (the “Registration Docu-ment”). This document may only be used in support of a financial transaction if supplemented by a transaction notice certified by the AMF. It has been prepared by the Company and engages the liability of its signatories.

In accordance with the provisions of Article L. 621-8-1-I of the French Monetary and Financial Code, this document was registered once the AMF had ascertained that it was complete and understandable, and that the information that it contains was consistent. It does not imply ratification by the AMF of the financial and accounting items included herein.

Copies of the Registration Document are available free of charge from Marie Brizard Wine & Spirits, 19, boulevard Paul Vaillant Couturier – 40, quai Jean Compagnon – 94200 Ivry-sur-Seine, on the AMF website (http://amf-france.org), and on the Company’s website (http://www.belvedere.fr).

It is reminded last Shareholders General Meeting on 30th June 2015 decided to change the name of the Company, which is now “ Marie Brizard Wine & Spirits ”, instead of “ Belvédère ”. Thus, within the present Registration Docu-ment, the reader would find both Company’s names, some legal and/or financial information was established before this legal Company’s name change.

Marie Brizard Wine & SpiritS

19, Boulevard paul vaillant Couturier 40, quai Jean CoMpagnon

94200 ivry-Sur-Seine

Créteil trade & CoMpanieS regiSter under nuMBer 380 695 213

Shae Capital of € 52,973,242

RegistRation Document

2014


TABLE OF CONTENTS

PAR T 1

Presentation of the Group

CHAPTER 1: MARIE BRIZARD WINE & SPIRITS GROUP PRESENTATION

1.1 Key events in Marie Brizard Wine & Spirits Group history

1.2 Simplified flow chart

1.3 Role of the different legal struc-tures

1.4 Activities of Marie Brizard Wine & Spirits

1.5 Main markets and activities

1.6 Selected financial information

1.7 Properties, plants and equipments

1.8 Important contracts

page 7

page 7

page 8

page 8

page 9

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page 10

page 12

page 13

page 16

page 16

page 20

page 27

page 29

page 36

page 37

page 38

page 45

page 47

page 54

page 58

page 58

PAR T 2

Legal and financial informa-tion

CHAPTER 2: MANAGEMENT REPORT FOR 2014

2.1 Activities and events of 2014

2.2 Analysis of results and of financial structure at year ended 31 december 2014

2.3 Latest events and outlooks

2.4 Risk factors

2.5 Description of the group

2.6 Investment policy

2.7 Governance and remuneration

2.8 Workforce

2.9 Share capital and shareholding structure

2.10 Other information

CHAPTER 2 BIS: ADDITIONAL INFORMATION TO 2014 MANAGEMENT REPORT

2.2 bis Analysis of results and of financial structure at the end of H1 2015

4registration document

2.4 bis Risk factors

2.7 bis Governance and remuneration

2.8 bis Workforce

CHAPTER 3: SOCIAL AND ENVIRONMENTAL RESPONSIBILITY REPORT

3.1 Information regarding staff and environmental information and social commitments to sustainable develop-ment

3.2 Independent third party’s report on the consolidated social and envi-ronmental information provided in this Management Report

CHAPTER 4: CONSOLIDATED STATEMENT

4.1 2014 consolidated income state-ment

4.2 Statutory Auditors’ report on the 2014 financial statements

4.3 H1 2015 consolidated income statement

4.4 Statutory Auditors’ report on the H1 2015 financial statements

CHAPTER 5: GOVERNANCE AND INTERNAL CONTROL

5.1 Chairman’s report on corporate governance and internal control

5.2 Statutory Auditors’ Report on the Chairman’s report on Corporate Governance and Internal Control

5.3 Description of the regulated agreements

5.4 Statutory Auditors’ special report on regulated agreements

page 64

page 65

page 68

page 69

page 69

page 81

page 83

page 83

page 127

page 129

page 158

page 159

page 159

page 170

page 171

page 172

PAR T 3

Additional information

CHAPTER 6: GENERAL INFORMATION ABOUT THE COMPANY AND ITS SHARE CAPITAL

6.1 General information about Marie Brizard Wine & Spirits SA

6.2 Memorandum and Articles of Association

6.3 Shareholders and Voting rights

6.4 Dividend distribution

6.5 Depositary

CHAPTER 7: COMBINED GENERAL MEETING 30 JUNE 2015

7.1 Board of Directors’reports to the Combined General Meeting - 30 June 2015

7.2 Share buy-back program

7.3 Specific reports of the auditors on certain resolutions on the agenda of the General Meeting 30 June 2015

7.4 Draft resolutions submitted to the General Meeting - 30 June 2015

7.5 Resolution voting results for the Combined General Meeting held on 30 June 2015

CHAPTER 8: PERSONS RESPONSIBLE FOR THE REGISTRATION DOCUMENT

8.1 Person responsible for the Registra-tion Document

8.2 Declaration by the person responsible for the Registration Document

8.3 Documents incorporated by reference

8.4 Documents available to the publicAPPENDIX

Registration Document cross reference table regarding appendix I of Commission Regula-tion (« Directive Prospectus »)

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william peel

La marqueWilliam Peel est un scotch whisky

vieilli en fût de chêne dans la plus pure tradition écossaise. Avec près de 3 millions de caisses vendues en 2014, William Peel est la 8ème marque mondial de scotch whisky, la 2ème plus forte croissance 2014 selon Im-pact et leader en France, 1er marché au monde de scotch whisky.

Le savoir-faireReflet d’une tradition millénaire

et distillé en Ecosse, William Peel associe les meilleurs whiskies de malt et de grains. Le Whisky de malt pro-vient du triangle d’or du whisky, du Speyside et des Highlands, régions parcourues par des cours d’eau d’une extrême pureté qui donnent au malt son goût si particulier et inimitable.

Le whisky de grain provient, lui, des Lowlands, le berceau du whisky.

Le secret de William Peel repose sur cette sélection rigoureuse des cé-réales et sur son assemblage méticu-leux pour un Blended Scotch whisky, parfaitement équilibré et rond, qui révèle la générosité des notes maltées et fruitées.

La gammeWilliam Peel joue pleinement

son rôle de leader et porte la caté-gorie vers de nouvelles saveurs et de nouveaux usages. Ainsi, récemment, William Peel a lancé des déclinaisons aromatisées, William Peel Honey et William Peel Delicious Coffee qui se dégustent pures et bien fraiches, mais aussi allongées en long drink et en cocktails.

PREMIÈRE PARTIE

Présentation du Groupe

william peel

The BrandWilliam Peel is a scotch whisky

aged in oak casks in the best Scotch tradition. With more than 3 million cases sold in 2014, William Peel is the 8th leading brand of Scotch whisky worldwide, with the 2nd highest growth in 2014 according to Impact and the leader in France, no. 1 Scotch whisky market worldwide.

The ExpertiseDistilled in Scotland and reflec-

ting a tradition a thousand years old, William Peel blends the best malt and grain whiskies. Malt whisky comes from the golden triangle of whisky, from the Speyside and Highlands, regions crossed by streams of extre-mely pure water which gives the malt its particular and incomparable taste.

The grain whisky comes from the Lowlands, the cradle of whisky.

William Peel’s secret comes from this careful selection of grains and their meticulous blending for a per-fectly balanced and round Blended Scotch whisky which reveals the generosity of the malted and fruity notes.

The Product LineWilliam Peel plays its leadership

role and carries the category to new flavors and new uses. Thus, recently, William Peel introduced new flavored versions, William Peel Honey and William Peel Delicious Coffee that tasted pure and fresh, as well as elon-gated long drink and cocktails.

PART 1

Presentation of the Group


CHAPTER 1MARIE BRIZARD WINE & SPIRITS GROUP PRESENTATION

1.1 Key events in Marie Brizard Wine & Spirits Group history 1.2 Simplified flow chart1.3 Role of the different legal structures1.4 Activities of Marie Brizard Wine & Spirits1.5 Main markets and activities1.6 Selected financial information1.7 Properties, plants and equipments1.8 Important contracts


1.1 Key events in Marie Bri-zard Wine & Spirits Group history

The company was funded on 10 January 1991 at Beaune. In the 90’s, it emerged as the first company to market upscale vo-dkas while developing a large distribution network especially in Poland.

On 21 January 1997, the company was introduced on the Paris stock exchange.

In 1998, the company created the vodka brand “Sobieski”

In the 2000’s, the company launched the commercialization of a lot of new products and gained production means in order to integrate the whole value chain. Thus, in 2000, the marketing of wines began in Bulgaria followed in the next years by the ac-quisition of a wine domain as well as distilleries in Poland and Lithuania.

In 2006, the company acquired Marie Brizard & Roger Interna-tional. That acquisition enabled to acquire the range of products linked to the longstanding brand “Marie Brizard” such as William Peel, Cognac Gautier and the wines Moncigale.

In 2008, during an economic turmoil, the company has to face the opening of a safeguard proceeding. In 2011, the safe-guard plan ended and a court-ordered rehabilitation proceeding

was engaged. In 2013, the General Meeting of the Company’s Shareholders approved the rehabilitation plan, which includes debt repayment schemes and clearance of some liabilities.

During 2010 and 2011, the company continued to launch new products such as vodka Krupnik in Poland and the flavored wines “Fruits and Wines”.

Years 2014 and 2015 stand for a normalization period for the Group, with the set-up of new governance and the dissociation of the functions of Chairman of the Board of Directors from those of Chief Executive Officer, as well as the creation of an Executive Committee.

On December 2014, after important strategic review of the working group led by the new Chief Executive Officer, the BiG 2018 plan («Back in the Game 2018») was announced to em-ployees, partners, shareholders and the market. It states objec-tives for the next 3 years.

Marie Brizard Wine & Spirits is a main actor in the wines and spirits markets whose ambitious development is based on 4 strategic pillars:

- Vodka (in France and Poland #3 and Worldwide #7) with two key brands: “Sobieski” and “Krupnik” 1 et 2,

- Brand William Peel on the Scotch whisky segment (in France #1 and Worldwide #9) 1,

- Brand “Marie Brizard” on the spirits market with a recognized know how since 1755,

MARIE BRIZARD WINE & SPIRITS GROUP PRESENTATION

1


- Brand “Fruits and Wine” on the aromatized wine-based drinks (in France #1) 3.

On 30 June 2015, the General Meeting of the Company’s Shareholders approved the new legal name “Marie Brizard Wine & Spirits” as a replacement for “Belvédère”.

1: Source: Nielsen, Decembre 20142: Source: NABCA, Decembre 20143: Source: IRI, Decembre 2014

1.3 Role of the different legal structures

The Group is composed of entities broken down according to 7 clusters:

- North America- South America,- Central Europe- Eastern Europe- Southern Europe- France / Spain- Belvédère International

1.2 Simplified flow chart

Simplified flow Chart (Share Capital Split)

Diana Holding

17,3%DF Holding

5,7%COFEPP

5,1%SPC Lux Mgmt

4,8%Others

67,2%

SOBIESKI SP. ZO.O.

Poland 100%

MARIE BRIZARD & ROGET INT

France 100%

MARIE BRIZARD WINE & SPIRITS SCANDINAVIA

Denmark 100%

IMPERIAL BRANDS

USA 100%

MARIE BRIZARD WINE & SPIRITS

BULGARIA

Bulgaria 100%

DUBAR

Brazil 100%

VILNIUS DEGTINE

Lithuania 68,29%

MARIE BRIZARD ESPAGNE

Spain 100%

MARIE BRIZARD WINE & SPIRITS SA

North America

South America

Spaincluster

Francecluster

Central Europe

Southern Europe

Eastern Europe

Belvédère International

cluster


Three main types of subsidiaries can be distinguished within the Group:

1/ The production companies, whose role is to produce wines and spirits for the Group. Those companies cover those different processes:

- Assembly and aging of wines- Distillation- Bottling- Packaging

2/ The distribution companies, whose role is to market and promote the products of the Group within each cluster.

3 / Marie Brizard Wine & Spirits SA is the Holding company for the entire Group. Its main objectives are to manage its subsidia-ries and to ensure the right application of the BiG 2018 plan.

1.4 Activities of Marie Brizard Wine & Spirits

As a reminder, the Group is an international player in the alco-holic drinks sector: marketing and distributing wines and spirits, primarily in Poland, the United States, and France.

The production and marketing of vodka is one of the Group’s main business activities principally through the Sobieski and Krupnik brands.

The group consisting of Marie Brizard and its subsidiaries is fo-cused on production and selling products mainly under William Peel, Marie Brizard, Moncigale and Fruits & Wine brands.

In 2014, new brands, new brand versions and new products were launched within each of the Group’s main business activi-ties.

The Fruits & Wine brand continued its expansion in 2014 with the launch of Fruits & Wine Rosé Apricot and Fruits & Wine White Apple, as well as a line of organic products.

The brand “Marie Brizard” complemented its range of syrups with the launch of a dozen of new products, including Royal Cho-colate, Appel Sour and Cranberry.

Finally, the William Peel assortment was extended with the launch of two whisky-based spirits “William Peel Honey” and “Wil-liam Peel Coffee”.

In 2014, in an uncertain global economic environment, the global market for wines and spirits continued its growth, notably driven by i) the USA (+ 2.2% in volume for spirits), and ii) spirits and vodka.

2015 should confirm the main trends observed in recent years and in particular the sophistication of aromas and the growth of whisky products.

1.5 Main markets and activi-ties

The average annual growth of the Spirits market is estimated to 6% annually for the period 2014 – 2017. Focused on the “value” and “standard” segments which are the most important and the most contributive to the growth of the market in France, Poland and in the United Stated of America, Marie Brizard Wine & Spi-rits owns a unique positioning and brand portfolio. It possesses a strong match with the current trends of consumption: cocktails, women consumption, value for money positioning, sophistica-tion of flavours, etc.

Armed with those assets, Marie Brizard Wine & Spirits aims to reinforce its multiregional strategy and wished to bring value to its clients and consumers by offering trustworthy, bold and full of flavours brands.

1.5.1 Key markets of its development

France: grow to reinforce its position as #3 of the market

In France, the “value” and “standard” segments repre-sented 86% of the market in value in 2013 and 78% of the market growth since 2005. The Marie Brizard Wine & Spi-rits positioning enables it to target a reinforcement of lea-der in the markets of William Peel and Fruits & Wine. For Sobieski, the goal is to become #2 of the Vodka market.

Thus, Marie Brizard Wine & Spirits forecasts an average annual growth of its volume in France of around 2% between 2014 and 2018 and revenues of over €200m in 2018.

Poland: developping presence on every wine and spirits segments

The Polish market is characterized by an expected growth of 12% from 2014 to 2018 and a predominance of “value” and “standard” segments with 95% of the market in 2013 and 88% of the growth since 2005. Considering those facts, Marie Brizard Wine & Spirits wishes to beco-me a complete actor of the wine and spirits Polish market. To achieve this, the Group aims to regain its #2 rank wit-hin the Vodka segment and implement Fruits & Wine as well as William Peel categories. As a matter of fact, scotch / whisky should represent 50% of the growth expected of the Polish market for Spirits for 2018 and the positioning of William Peel is highly adequate to be implemented du-rably on this market. In Lithuania, is aim is to become #1


of the Vodka market.

Marie Brizard Wine & Spirits has a goal for the Polish market of an annual average growth for volumes of 8% between 2014 and 2018 in order to attain 2018 revenues above €80m (after sale of Polish non-strategic assets).

United-States of America: finalize the recovery and grow profitability

For Marie Brizard Wine & Spir its, the US market is mainly focused on Vodka but also on Marie Brizard li-quors and on Fruits and Wine.

The US Vodka market should grow by 11.5% annually till 2018 and the “Standard” segment should represent 61% of the growth in value during the later years. Marie Brizard Wine & Spirits esti-mates that is able to integrate the #3 Rank of imported Vodkas on that segment.

In the US, Marie Brizard Wine & Spirits anticipates an annual average growth for volumes of 22% between 2014 and 2018 in order to attain 2018 revenues above €50m.

Spain: innovating and breaking codes

The Spanish market is characterized by its appetence for innovative products. Marie Brizard Wine & Spirits aims to launch new products and to reinforce its commercial ties with the mass distribution players. Moreover, it considers that the Fruits and Wine category has a strong growth po-tential in the country.

As a consequence, Marie Brizard Wine & Spirits anticipates an annual average growth for volumes of 7% between 2014 and 2018 in order to attain 2018 revenues above €20m

Brazil: accelerating growth

The Brazil ian market is expected to grow annually on average by 13% till 2018. Vodka and Scotch/Whisky should represent 90% of the growth.

Marie Brizard Wine & Spirits anticipates an annual average growth for volumes of 8% between 2014 and 2018 in order to attain 2018 revenues above €8m.

1.5.2 Four strategic pillars

Vodka

For the Vodka market, Marie Brizard Wine & Spirits exhibits a differentiated and complementary offer through global and local brands, mainly on the Standard and Pre-mium segments. Regarding that pillar, the Group’s strate-gy stands on the Sobieski brand for which the group aims to an annual average growth for volumes of around 14% between 2014 and 2018 through a renewed and enlarged range of products, an acceleration in promotional adver-tising investments and the setting-up of a more efficient

distribution model. William Peel

As of today, William Peel is the leading brand of the French Scotch/Whisky market, which is the first world-wide Scotch/Whisky market. William Peel is going to be soon marketed in Poland, Brazil and in Lithuania where the potential is highly significant. Marie Brizard Wine & Spirits aims to achieve an annual average growth for vo-lumes of 4% between 2014 and 2018. That growth would come chiefly from an increase in promotional advertising investments, a quality upgrade through innovation and a deployment of the brand in Poland.

Marie Brizard

Marie Brizard Spirits match perfectly with the current trends of consumption. The group aims to achieve an annual average growth for volumes of 7% between 2014 and 2018 through the rejuvenation of the brand image, the intensification of commer-cial links with the mass distribution players and the cafés, hotels and restaurants (CHR), an increase in promotional advertising in-vestments and finally the improvement of the distribution model.

Fruits and Wine

Fruits and Wine is the French leader for wine flavoured beve-rages and will benefit from the worldwide craze for that segment. Marie Brizard Wine & Spirits aims to achieve an annual average growth for volumes of 12% between 2014 and 2018 by pursuing its dynamic, developing in the Group key countries and increa-sing in promotional advertising investments.

1.6 Selected financial infor-mation

1.6.1 Consolidated key figures (12 months)

In order to provide better readability of its activity and a better comparison with its main peers, Belvédère has de-cided to carry out some changes in the way it presents its accounts.

- Revenues: revenues of the Group are now presented net of rebates and discounts. That change of presentation is only for the United Stated subsidiary which accounted those costs in its ex-ternal charges.

- Excise duties: in conformity with the uses of main players of the sector and for better comparison, the Group added an ag-gregate to its financial accounts in order to present the revenues excluding excise duties for sold volumes.

Presentation rules are described in Note 1.2. in the Notes to the Company’s consolidated financial statements and in Note 2.


in the Notes to the Company’s annual financial statements.

For better readability, 2014 presentation rules were applied to years 2012 and 2013.

1.6.2 Key figures by area for 2013

ConSolidated Key finanCial data

Key figureS by area for 2013

In € 000(except for employees)

201212 months

201312 months(restated)


Revenues 891 900 859 911 716 528Revenues excluding duties 1 551 264 539 566 466 678

EBITDA 2 3 230 10 627 5 191Profit (Loss) on continuing operations -9 048 279 1042

Operating Profit (Loss) -118 558 190 467 -18 198

Gross Investments 4 064 4 565 4 847

Restated Net Debt 3 535 268 -19 128 -41 550Equity Capital - Group share -306 803 211 479 188 488

Staff at closing (continuing activities) 3 142 2 975 2 493

1 In some countries, especially in Poland, the excise duties (duties on alocohol) are considered as whole components ofthe production costs and are not retrieved from the revenues. This aggregate "revenues excluding excise duties"corresponds to the revenues adjusted for the excise duties according to the volume sold. Moreover, turnover excludingduties is now reported net of discounts and commercial benefits granted.

2 Ebitda : Earnings before interests, taxes, depreciations and amortizations

3 Net debt adjusted of deposits of escrow accounts


Poland Western Europe

Lithuania Bulgaria Other countries

Parent Company


Revenues 505 154 257 986 50 708 6 246 36 767 3 856 864Revenues excluding duties 222 908 257 986 17 423 6 246 34 990 3 539 566

EBITDA 5 683 15 686 1 927 (1 719) 3 698 (14 648) 10 627Profit (Loss) on continuing operations 810 12 490 603 (2 329) 3 284 (14 579) 279

Operating Profit (Loss) (876) 1 117 394 (18 736) 3 824 204 743 190 467

Gross Investments 1 321 1 177 243 1 547 275 3 4 565

Net Debt (7 535) (8 172) 6 742 (103) (4 152) (5 909) (19 128)Equity Capital - Group share 211 479

Staff at closing (continuing activities) 1 689 729 233 246 69 9 2 975


1.6.3 Key figures by area for 2014

1.7 Properties, plants and equipments

The Group owns its industrial real estate assets in most cases. It also benefits from long-term leases arising from the acquisition process for Polmos (distilleries) in Poland: these leases grant the Group a right of usufruct over the land concerned for a period of 99 years.

The Group has seventeen main industrial sites with activities of production, distillation, assembly, aging, packaging, and bott-ling. The operating assets of the Group and their maintenance or improvement are of major concerns. It constituted a level of fixed tangible assets of €216.6m as at 31 December 2014.

For examples, the main industrial sites of the Group are the followings:

- Two Polish locations at Starogard and Lancut, focused on Vo-dka products. They totalize respectively 250 and 160 employees.

- The French locations at Lormont and Fondaudège, as well as Beaucaire. Those sites gather the assembly, packaging and bott-ling processes especially for the Fruits and Wine products (Beau-caire). Beaucaire totalize 180 employees.

- The Vilnius location in Lithuania, enable the distillation, pac-kaging and bottling processes of Vodka and Liquor products, with a total of 150 employees.

- The Starazagora location in Bulgarian, where the Group owns Vineyards. This site is engaged in the production and aging of wines with a total of more than 100 employees.

Most of the Group’s plants are ISO compliant. In the case of sites that are located in urban areas, the risk of pollution or fire is subject to audit and prevention procedures that are formally set down with the regional or district departments concerned. Plants acquired by the Group are renovated and made compliant with environmental, health and safety standards.

The Group implements a responsible environmental policy in each country where it has production sites. To the Company’s knowledge, there was no industrial process within the Group that could call into question the impact of its activities on the envi-ronment.

In the frame of BiG 2018 plan announced by the company last December, the upgrade of the industrial footprint is a major challenge. Consequently, some investments have to be made in order to:

- Insource distillation and rectification capacities for vodka production,

- Secure and upgrade Fruits & Wine production,

- Review the industrial footprint for liquor production,

- Reconfigure the logistics network.

For example, in 2015, Marie Brizard Wine & Spirits forecasts investments of approximately €14.9m, financed internally (cash available and/or actual financing) in order to:

- Move the production site of Bordeaux in existing production sites,

- Improve the distillation / rectification processes in Lithuania,

Key figureS by area for 2014


Poland Western Europe

Lithuania Bulgaria Other countries

Parent Company

201412 months

Revenues 388 631 232 315 60 380 5 705 29 436 62 716 528Revenues excluding duties 178 958 232 315 21 776 5 705 27 864 62 466 678

EBITDA (563) 11 941 2 340 (1 611) 365 (7 281) 5 191Profit (Loss) on continuing operations (1 958) 9 309 1518 (401) (169) (7 258) 1 042

Operating Profit (Loss) (8 307) 2 458 1 275 (463) (56) (13 105) (18 198)

Gross Investments 2 263 1 986 211 160 141 84 4 847

Net Debt (18 699) (19 081) 4 930 (463) (4 374) (3 863) (41 550)Equity Capital - Group share 188 488

Staff at closing (continuing activities) 1 466 535 251 150 69 22 2 493


- Modernize the production capacities for the Fruits & Wine part.

At the date of this document, the Group made firm commit-ments for a total amount of €7.4m.

1.8 Important contractsAll contracts were concluded by the Group in the frame of cur-

rent affairs.

Nevertheless, those elements have to be noted:

Groupe Casino

The company Moncigale was acquired in 2002 from the Groupe Casino. Important commercial ties still exist as of today between the two groups. In 2014, almost 45% of Moncigale’s activity is realized with its main customer which is Groupe Casino.

Settlement agreements

Two settlement agreements were entered into by the Company during the 2013 financial year:

- a support agreement was entered into by the Company, the Guarantors and Krzysztof Trylinski on 17 July 2013. The signing of this agreement was authorized by the Company’s Board of Direc-tors on 20 March 2013.

The detailed procedures of this support agreement are set out in the Statutory Auditors’ special report on the regulated agreements and undertakings for the financial year ended 31 December 2012 (see Section 6.3.3 of the 2012 Registration Do-cument).

- a settlement agreement was entered into on 30 September 2013 by Krzysztof Trylinski and the Company, acting in its name and in the name of its subsidiaries and sub-subsidiaries. The si-gning of this agreement was authorized by the Company’s Board of Directors on 30 September 2013, and said agreement will be submitted for the approval of the Company’s shareholders at the Ordinary Annual General Meeting convened to approve the financial statements for the financial year ended 31 December 2013.

Details of these agreements are provided in Section 5.1 of the 2013 Registration Document.

registration document 14Part 2. LegaL and financiaL information

The BrandSobieski is a traditional vodka,

elaborated from rye from the broad polish plains, its ancestral home. It takes its name from the last great Po-lish king, King Jan III Sobieski, who ruled at the end of the 17th century.

Today, Sobieski is the spearhead of Belvédère’s international strategy with strong positions in France, the United States, Lituania, and more.

The ExpertiseWith the tallest rectification

column in Poland (nearly 40 meters tall), guaranteeing the quality and purity of the distilled vodka, Sobieski vodkas have a unique, balanced taste.

Sobieski is a modern vodka which offers bottles with an emblematic de-sign that stands out from the crowd.

The Product LineSobieski offers a wide range of

products suitable to all kinds of oc-casions. Sobieski Estate is developed from the «Dankowski» rye variety and crystal clear water.This vodka has an exceptional purity and is pre-sented in a fine, elegant bottle which represents its unique character.

Sobieski also offers numerous fla-vored vodkas, such as: citron, orange, and raspberry Sobieski propose une large gamme adaptée à tous les mo-ments de consommation.

SobieSKi

Legal and financialinformation

PART 2


CHAPTER 2MANAGEMENT REPORT FOR 2014

2.1 Activities and events of 2014 2.2 Analysis of results and of financial structure at year ended 31 december 20142.3 Latest events and outlooks2.4 Risk factors2.5 Description of the group2.6 Investment policy2.7 Governance and remuneration2.8 Workforce2.9 Share capital and shareholding structure2.10 Other information

CHAPTER 2 BISADDITIONAL INFORMATION TO 2014 MANAGEMENT REPORT

2.2 bis Analysis of results and of financial structure at the end of H1 20152.4 bis Risk factors2.7 bis Governance and remuneration 2.8 bis Workforce

CHAPTER 3SOCIAL AND ENVIRONMENTAL RESPONSIBILTYREPORT

3.1 Information regarding staff and environmental information and social commitments to sustainable development 3.2. Independent third party’s report on the consolidated social and environmental information provided in this Management Report

CHAPTER 42014 CONSOLIDATED STATEMENT

4.1 2014 consolidated income statement 4.2 Statutory Auditors’ report on the 2014 financial statements4.3 H1 2015 consolidated income statement 4.4 Statutory Auditors’ report on the H1 2015 financial statements

CHAPTER 5GOVERNANCE AND INTERNAL CONTROL

5.1 Chairman’s report on corporate governance and internal control5.2 Statutory Auditors’ Report on the Chairman’s report on Corporate Governance and Internal Control5.3 Description of the regulated agreements5.4 Statutory Auditors’ special report on regulated agreements


The management report for 2014 established by the Board of Marie Brizard Wine & Spirits / Belvédère is taken back in the following pages. This information is completed and updated, in particular within the chapters 2 bis and 6 of the present Registration Document.

2.1 Activities and events for 2014

MANAGEMENT REPORT FOR 2014

22.1.1 Evolution of Group’s activities in 2014

As a reminder, the Group is an international player in the alcoholic drinks sector: marketing and distributing wines and spirits, primarily in Poland, the United States, and France.


The vodka business

The production and marketing of vodka is one of the Group’s main business activities.

Source : Company

The Danzka vodka brand was sold on 10 April 2013.

main produCtS / vodKa

StarogardzKaSobieSKiKrupniK

balSam pomorSKi

polonaiSe

zawiSza

KraKowSKa

bajoru

Starogardzka, a local traditional vodka, is the Group’s third most important brand and is sold in a number of formats, including flavoured vo-dkas. Starogardzka, which is primarily sold in Poland, is also available in China, Ireland, Aus-tria, Turkey, Sweden and Slovenia.

Sobieski is distilled from Dankowki rye, and is a fine vodka that is available in a range of versions (traditional Sobieski, Sobieski Estates, Sobieski Flavored, and Sobieski Impress). Sobieski is sold in over 50 countries, reaching for example a 11,9% market share in France in 2014.

Krupnik, which is made from cereals, honeyed buckwheat and various herbs, is a traditional liqueur that has become widespread in Poland and Lithuania since 2010. Krupnik is also sold in many other countries including the United States, Ca-nada, Australia, the United Kingdom, and Germany.

Zawisza, which is distilled five times and un-dergoes a rigorous quality control process that guarantees both its taste and its clarity, is a clear vodka made from rye. Zawisza has been avai-lable in Poland since 1999 and the bottles were redesigned in 2009.

Balsam Pomorski, which was created in 2004, is a sophisticated vodka made from tender oranges and green walnuts. This vodka is avai-lable in a flavoured version. Balsam Pomorski is only available in Poland and the bottle de-sign was updated in 2011.

La Polonaise is a traditional vodka, with a new bottle design introduced in 2009. This vodka is also available in a flavoured version. La Polo-naise is available in Poland, France, Turkey and Austria.

Krakowska, which has featured a new de-sign since 2009, has been selected to strengthen the Group’s less expensive vo-dka range. This vodka is available in Poland and Greece.

Bajoru is a light Lithuanian vodka, which is also available in an upmarket flavoured ver-sion known as Bajoru Klasikine.


The Marie Brizard Group’s business

The group consisting of Marie Brizard & Roger Inter-national (MBRI) and its subsidiaries is focused on pro-duction and selling products mainly under William Peel, Marie Brizard, Moncigale and Fruits & Wine brands.

Source : Company

main produCtS / marie brizard

marie brizard

CognaC gautier

william peel

CoCKtailS pit terSon

monCigale

berger

Sir pit terSon

porto pit terS

marqueS del puerto

San joSé

old lady’S

Marie Brizard, which was founded in 1720, pro-duces an anisette from green aniseed, as well as modern fruit liqueurs. New bottles and ad-vertising campaigns were launched in 2009.

Maison Gautier, which was established in 1697, is one of the oldest cognac houses. Cognac Gautier is primarily sold on the export market, i.e. outside France.

William Peel, which is a blend of malt and grains from the Scottish Lowlands and Highlands, was launched on the French market in 1986. This mid-range whisky had a market share of 21.9% in 2014.

Pitterson Cocktails sells ready-made cocktails (Vodka-Orange, Gin Fizz, and Mojito, etc.) ins-pired by Marie Brizard’s expertise in cocktail recipes.

Moncigale sells rosé wines from Provence in the South of France, and produces Cô-teaux d’Aix, Côteaux de Varois and Côteaux de Provence wines from various grape blends. The rosé wine is available in seve-ral formats. Moncigale wines are produced and bottled in Beaucaire near Marseille.

Berger, which was founded in 1830, pro-duces Pastis, a genuine French specia-lity from Marseille, which is made from aniseed and liquorice. Berger Blanc had a 45,9% share of the Pastis Blanc market in 2014.

San José, which is a twice-distilled Mexican te-quila made from blue agave and produced in Jalisco, is the leader on the French tequila mar-ket, with a market share of 43.2% in 2014. This tequila is available in an upmarket version under the San José Gold brand.

Sir Pitterson, which was re-launched as an affordable whisky in 2011, is a blended scotch whisky made from malt and grains from eight distilleries in the Scottish Highlands.

Pitters Porto, which is made from grapes grown in the Douro Valley, is a port wine that is bottled in Portugal and is also available as a white port.

Bodega Marques del Puerto, which was founded in 1986 and purchased by Marie Brizard in 1996, is based in Fuenmayor in Spain’s famous Rioja Region. The company produces a wide range of Rioja wines.

Old Lady’s, which is made from juniper berries and coriander, orange and lemon, is distilled twice and produced in England. A new bottle was launched in 2010 and the gin’s market share in France was already 5.9% in 2011.


New products or services launched on the market

In 2014, new brands, new brand versions and new pro-ducts were launched within each of the Group’s main bu-siness activities.

The Fruits & Wine brand continued its expansion in 2014 with the launch of Fruits & Wine Rosé Apricot and Fruits & Wine White Apple, as well as a line of organic products.

The brand “Marie Brizard” complemented its range of syrups with the launch of a dozen of new products, including Royal Cho-colate, Appel Sour and Cranberry.

Finally, the William Peel assortment was extended with the launch of two whisky-based spirits “William Peel Honey” and “William Peel Coffee”. Those products should be growth drivers in 2015 for the brand William Peel.

2.1.2 Main markets events and trends in 2014

In 2014, in an uncertain global economic environment, the global market for wines and spirits continued its growth, notably driven by i) the USA (+ 2.2% in volume for spirits), and ii) spirits and vodka.

2015 should confirm the main trends observed in recent years and in particular the sophistication of aromas and the growth of whisky products.

2.1.3 Main events which occured during 2014 financial year

Payment of the 1st dividend

The Belvédère Group paid Fréderic Abitbol, the Admi-nistrator appointed to oversee the Execution of the Plan, the amounts of the first dividends due on 19 March 2014 for 8 Group companies involved (Belvédère, MBRI, So-bieski, Destylarnia Sobieski, Sobieski Trade, Domain Me-nada, Destylernia Polmos, and Fabryka Wodek).

Moncigale’s frozen debts were also subject to a gradual repay-ment schedule.

The 1st dividend paid by Moncigale was paid to Mr Torelli, the Administrator appointed to oversee the Execution of the Plan, on 16 April 2014.

Change in governance structure

The Appointments Committee, in accordance with the assignment entrusted to it, submitted several applicants for the position of Chief Executive Officer to the Board of Directors.

On 27 March 2014, the Board of Directors chose, subject to the approval of its position by the chosen applicant, to:

- Dissociate the functions of Chairman of the Board of Direc-tors from those of Chief Executive Officer;

- Extend the term of the mandates of M. Krzysztof Trylinski as member and Chairman of the Board of Directors until the end of its mandate;

- To appoint M. Jean-Noël Reynaud as Chief Executive Officer of the company.

On 31 March 2014, the Board of Directors noted the approval of Jean-Noël Reynaud and confirmed its appointment as Chief Executive Officer. It is indicated that it was effective starting 5 May 2014.

Besides, during the meeting of the Board of Directors on 28 July 2014, M. Krzystof Trylinski stated that he was submitting his resignation as a member and Chairman of the Board of Directors for personal reasons. In order to ensure an efficient transition period, M. Krzystof Trylinski agreed to hold its positions until the next General Meeting of Shareholders due on 16 September 2014.

The Board of Directors noted this resignation and decided to maintain the dissociation of the functions of Chairman of the Board of Directors from those of Chief Executive Officer that was decided in early 2014 to comply with governance best practices.

As a result, and following the recommendation of the Nomi-nating Committee, the Board of Directors decided to appoint M. Benoît Hérault as Chairman of the Board of Directors. He began its functions starting 16 September 2014. M. Benoît Hérault had been an independent Director of the Company since the Com-bined Annual General Meeting held on 30 September 2013.

During the General Assembly held on 16 September 2014, Mrs. Rita Maria Zniber was appointed to the position of Direc-tor, representing Diana Holding shareholder, now reference shareholder of the Group. Mr. Benoît Ghiot was appointed as an independent Director.

The Board of Directors gathered on 24 October 2014, fol-lowing the recommendations of its Nominations and Remune-rations Committee, decided unanimously to co-opt M. Mehdi Bouchaara as a second member of the Board as a representative of Diana Holding and to create a position of Standing Invitee (wi-thout right to vote) for M. Serge Heringer as a representative and expert of Diana Holding. M. Mehdi Bouchaara was also appointed member of the Audit Committee for which M. Benoit Ghiot was appointed Chairman replacing M. Benoît Hérault. M. Serge Herin-ger was also appointed Standing Invitee to the Audit Committee.

These appointments reflect the position of Diana Holding as current first Belvédère shareholder and are part of a long term industrial, commercial and financial partnership.

Guarantee given to the Polish customs authori-ties

On 12 March 2014, Destylarnia Sobieski issued a pro-missory note for a maximum amount of PLN 542m (i.e. €126.8m as at 31 December 2014 exchange rate) for the benefit of the Polish customs authorities, as a guarantee for payment of excise duties for the period between 1 May


2014 and 30 April 2015. All of the guarantees granted by the Group in this regard are set out in Notes to the Com-pany’s consolidated financial statements for the financial year ended 31 December 2014 (Assets granted as gua-rantees and off-balance-sheet commitments).

New strategic plan BiG 2018

On 16 December 2014, after important strategic review of the working group led by the new Chief Executive Of-ficer, the BiG 2018 plan («Back in the Game 2018») was announced to employees, partners, shareholders and the market.

Positioning the Group as a credible challenger in the heart of the markets for wines and spirits, the objectives of this plan are to achieve a turnover between €420m and €460m in 2018 with an EBITDA margin from 12% to 15%.

The achievement of these objectives will be accomplished

through: - The disposals of non-core assets, in particular the activities of

wholesaler in Poland, some non-industrial facilities in Poland and finally some real estate assets in France and Poland;

- The optimization of core business activities, relying on the modernization of industrial facilities, the reduction of purchasing expenses, the improvement of the distribution model, the simpli-fication of operations and finally the development of key compe-tences within Group’s teams;

- The growth of activities positioned on Vodka, William Peel, Marie Brizard, Fruits & Wine products, and the growth of 5 key markets: France, Poland, USA, Spain and Brazil.

2.2 Analysis of results and of financial structure at year ended 31 december 2014

Consolidated financial statements and annual financial state-ments for the financial year ended 31 December 2014 were pre-pared in accordance with the rules, regarding the presentation and the valuation methods, provided for by the regulations in effect.

The rules used for the presentation and the valuation methods

used are described in Note 1.2. in the notes to the consolidated financial statements and in Note 2 in the notes to the annual fi-nancial statements.

2.2.1 Consolided activities in 2014

In 2014, the Group showed sales slightly higher than foreseen by “BIG 2018” plan at €466.7 m, down 4.1% on a comparable basis.

In order to provide better readability of its activity and a better comparison with its main peers, Belvédère has decided to carry out some changes in the way it presents its accounts

- Belvédère now publishes net sales, excluding excise duty, based on volumes sold rather than volumes produced;

- French sales and Export sales have been split apart;

- United States sales have been adjusted, and are now net of rebates and discounts.

Hence, on a new comparable basis, restated for contracts abandoned in 2014 and for scope effects, the Group’s revenue was down 4.1%, in line with the weak wine and spirits market.

Abandoned contracts (wine distributor brand contracts, end of the Pulco subcontracting contract, end of third-party vodkas and divestment of the Danzka brand) and scope effects (Ukraine, Slovakia and Belarus) accounted for €52.7m (i.e. 72%) of the €72.7m changes in sales between 2013 and 2014.

In 2014, Belvédère recorded consolidated net sales of €466.7m (€479.8m with the previous accounting method), down 13.5% (-13.6% excluding currency effect) compared with 2013.

Detailed evolution in sales by country

F R A N C E : G A I N S O F M A R K E T S H A R E F O R T H E G R O U P ’S S T R AT E G I C P I L L A R S

The Group’s flagship brands continued to improve their market shares and outstripped the French market in vo-lume terms. William Peel was increasing by 1.6% whereas the market was decreasing by -0.7%. Thus, on the Scotch whisky segment, with its William Peel brand, Belvédère is the leader with a market share of 21.9%.

group SaleS’ evolution during 2014 fiSCal year

In € m

-4,1%

2014

539,6 -47,3 -5,4 486,9 -21,0 0,8 466,7

2013Abandoned

ContractsPerimeter changes

2013restated

Like-for-like changes

Currency impacts


Regarding the aromatized wine-based drinks segment, Belvédère remains, with Fruits and Wine, the clear leader in its category with a market share of almost 30%. Fruit & Wine was increasing by 16.8%, doing better than the mar-ket at 15.6% (source: Nielsen & IRI, December 2014).

In 2014, net sales in France totaled €193.3 m, decreasing by 3.0% compared to 2013. That decrease was essentially due to the termination of non-profitable sale contracts.

P O L A N D : G R O U P ’S B R A N D S H E L D U P W E L L O V E R T H E 2 N D S E M E S T E R O F 2014, I N A M A R K E T A F F E C T E D BY I N C R E A S E S I N E XC I S E D U T Y

Net sales totaled €179.0m in 2014, down 19.7%. Exclu-ding the impact of the end of third-party vodka sales, sales were down by 8.8%.

In anticipation of the increase in excise duty that came into effect at the beginning of 2014, sales for the 4th quarter of 2013 had been particularly high in Poland. As a result, sales for the 1st half of 2014 were negatively affected, particularly as Belvédère chose not to take part in the price war undertaken by its peers in order to protect its margins.

Over the final quarter of 2014, the Group’s brands (particularly Sobieski and Krupnik) gained market shares, reaching 12.8% by volume on the vodka market, with 11.5% for Krupnik thanks to the launch of new formats and flavors (source: Nielsen, December 2014).

L I T H UA N I A : B U OYA N T G R O W T H , D R I V E N BY V O D K A

Net sales were of €22.5m in 2014, i.e. an increase of 25% compared with 2013. The Group’s main vodka brands drove this strong growth on a market recording moderate growth.

U N I T E D S TAT E S : I N C R E A S E I N S O B I E S K I ’S M A R K E T S H A R E I N K E Y S TAT E S

Based on NABCA (control states) figures, the vodka market grew by 2.9% in volume in 2014 whilst the Group’s sales increased by 9.4% in these states.

Net sales totaled €19.9m in 2014, down by 5.0% compared with 2013 mainly impacted by inventory clearance operations by distributors. As indicated above, in order to ensure better reada-bility of the Group’s activity in the United States, commercial re-bates and discounts given to wholesalers are no longer included in the sales figure. As a result, 2013 sales have been restated.

S PA I N : A B O V E T H E M A R K E T O N A CO M PA R A B L E S CO P E B A S I S

Net sales were of €13.9m in 2014. As in previous quar-ters, the termination of the Pulco subcontracting contract at Marie Brizard Spain in November 2013 had a significant impact on sales evolution.

On a comparable scope basis, the annual sales recorded in Spain in 2014 were down by 3% compared to the previous year.

Volumes sold were also down by 3% on a market that fell by 6.6% in volume (source: Nielsen, December 2014).

B R A Z I L : G R O W T H I N AC T I V I T Y, E XC LU D I N G C U R R E N C Y E F F E C T

Net sales totaled €5.1m in 2014, down 4.4% on the pre-vious year. Excluding the currency effect, sales were up by 3.4%. The final quarter of 2014 was affected by the increase in excise duty in the state of Rio on 1 November 2014.

2.2.2 Consolidated results for 2014

Consolidated profit and losse account

The Belvédère Group’s revenues for the 2014 financial year, excluding excise duties, amounted to €466.7m de-creasing by 13.5%. On a new comparable basis, restated for contracts abandoned in 2014 and for scope effects, the Group’s revenue was down 4.1%, in line with the weak wine and spirits market.

The strategy that required cutting off low-margin activities was complemented with a decrease of the operating expenses of the Group. Thus, the Group pursued the rationalization of its industrial processes and the negotiation of its contracts with pro-viders and customers.

In France, 1st contributor to the results of the Group, net sales decreased by 3.0% compared to 2013. That decrease was essen-tially due to the termination of non-profitable sale contracts and to the termination of one-off export contracts. The margin rate was stable at 6% due to action plans set up by the Group during the year.

In Poland, the decrease of the net sales were due to the cumu-lated effects of the increase in excise duty that came into effect at the beginning of 2014, of the intensification of promotional acti-vity that followed and of the decrease of the vodka trade division. The Group adapted its cost structure to those market conditions by reducing its staff to 223 people. Nevertheless, those actions were not effective for the whole year and the EBITDA margin had been falling.

In 2014, marketing expenses were reduced by €6.5m when compared to 2013. That drop is essentially due to the negotiation regarding image contracts.

As written before, in 2014, the Group adapted its staff in its different operating areas. Thus, the total number of employees went from 2,975 in 2013 to 2,493 at the end of 2014. In 2014, staff costs decreased by €6.0m and were of €57.9m.

In 2014, EBITDA was of €5.2m to compare to €10.6m for the previous year. The current operating profit was improved by €0.8m due to the write-backs of provisions on inventories and receivables. Those write-backs are linked to the rationalization of inventories and the review of receivables with significant age.

When closing the accounts on 31 December 2014, the Group defined more accurately its non-recurring operating profit. That


latter amounted to €15.0m and is mainly constituted of restruc-turing expenses for €8.7m and of other items linked to the finan-cial restructuration of the Group for €6.2m. Details regarding the non-recurring operating profit are given in note 4.4. in the Notes to the Company’s consolidated financial statements for the finan-cial year ended 31 December 2014.

The net financial result amounted to €-4.2m in 2014. It is main-ly composed of debt interests for a total amount of €-1.3m as well as the effect of a reverse discounting of frozen assets in the frame of the business continuation plan that represented a cost of €-6.0m without effect on the cash flows. Currency exchange rates had a positive impact for €2.8m due mainly to the evolution of the Zloty (PLN).

At the end of 2014, after taking into account the tax costs for €0.1m the net profit amounted to €-18.2m to be compared to €190.5m at the end of 2013.

Analysis of the activity by country

P O L A N D

With France, Poland is historically the most contribu-ting area as regard revenues. In Poland, representing 38.4% of revenues excluding duties, the total revenues excluding duties were of €179.0m decreasing by -19.7% (or -20.3% at constant exchange rates).

In anticipation of the increase in excise duty that came into effect at the beginning of 2014, sales for the 4th quarter of 2013 had been particularly high in Poland. As a result, sales for the 1st half of 2014 were negatively affected, particularly as Belvédère chose not to take part in the price war undertaken by its peers in order to protect its margins.

Moreover, following its rationalization strategy and its effort on its core activities, the Group reduced the vodka trade division in order to focus on high-margin products as well as proprietary trademarks.

Nevertheless, the Group confirmed its strength on the vodka market with market shares in volume of 12.9% (source: Nielsen at the end of December 2014) from which 11.5% for the Krupnik brand due to the launch of new formats and flavors.

EBITDA margin is lower when compared to 2013 because the rationalization of cost structure initiated in mid-2014 had not yet compensated the drop in revenues. Moreover, the EBITDA in Po-land is negatively impacted by rebilling of Management Fees for €1.3m.

W E S T E R N E U R O P E

Western Europe includes activities of Marie Brizard (spirits and wines) as well as those of the Scandinavian or-ganization.

This region is the main contributor to Group revenues exclu-ding duties. Besides the fall in revenues, EBITDA margin is in line with that of 2013 (once restated for the impact of the rebilling of Management Fees for €2.1m).

The Marie Brizard France unit had revenues of €215.4m i.e. a decrease of 6.4% compared to 2013. That fall is due to a decrease of -32% in export revenues and of -3% in the French market. Those evolutions are mainly linked to the termination of non-pro-fitable contracts on the French and Export markets.

2014 remained a good year regarding the overall performance of the leading brands of the Group in a weak Spirits market when

group’S ConSolidated p&l

poland p&l

€ 000 31 December 2014

31 December 2013

31 December 2012

Evol. 2014/2013 Evol. 2013/2012

Revenues 716 529 856 864 891 900 -16,4% -3,9%Revenues excluding duties 466 678 539 566 551 264 -13,5% -2,1%Ebitda 5 191 10 627 3 230 -51,2% 229,0%EBITDA Margin 1,1% 2,0% 0,6% - 0,9 pt + 1,4 ptProfit/(loss) on continuing operations 1 042 279 (9 048) 273,2% -103,1%Operating profit/(loss) (13 914) (35 737) (84 976)Cost of debt (1 330) (7 597) (21 449)Net financial items (4 224) 226 170 (24 562)Net profit/(loss) Group share (19 096) 190 260 (117 792)

€000 31 December 2014 31 December 2013 31 December 2012 Evol. 2014/2013 Evol. 2013/2012

Revenues 388 631 505 154 536 293 -23,1% -5,8%

Revenues excluding duties 178 959 222 908 229 450 -19,7% -2,9%

Ebitda (563) 5 683 13 496 -109,9% -57,9%

EBITDA Margin -0,3% 2,5% 5,9% - 2,9 pt. - 3,3 pt.

Underlying operating profit/(loss) (1 958) 810 8 608 -341,7% -90,6%


compared to 2013.

- The William Peel brand recorded a 1.6% increase in sales between December 2013 and December 2014 in a French whisky market that experienced a 0.7% decline.

- The Sobieski Vodka brand continued its growth in re-venues in volume; increasing by 1.7% between December 2013 and December 2014 whereas the French vodka market showed an increase of 3.0% over the same period. Belvé-dèreE remains the third player in the French market being closer to the second.

- Fruits & Wine, which was created in November 2010, showed a 16.8% increase in its sales volumes in 2014. This pioneering French fruit-flavored wine brand received the 2015 “Saveurs de l’année” (Tastes of the year) Award in November 2014 for its brand new range of organic products.

In Spain, the revenues excluding duties amounted to €13.9m in 2014 i.e. a decrease of -38.3% compared to 2013. That strong decrease is due to the termination of the Pulco subcontracting contract in November 2013. Excluding that impact, the revenues were down by -3% only when compared to the previous year. Vo-lumes sold were decreasing as well by -3% whereas the market lost 6.6% in volumes when compared to 2013.

Denmark recorded a 44.5% fall in business volumes in 2014 compared with 2013. This decrease is explained by the sale of the Danzka vodka brand on 10 April 2013.

L I T H UA N I A

Lithuania is one of the regions where the Group has an historic presence (the Vilnius Degtine distillery was ac-quired in 2003).

The trend, which began in 2012, kept going in 2014 with an increase of 25% in revenues excluding duties over the period. That progress concerns all categories of spirits sold by the Lithua-nian entity.

The commercial strategy, both in the Lithuanian market and for export, made it possible to increase the EBITDA at a high level i.e. €2.5m in 2014. EBITDA margin is improved by +0.2 bps once Management Fees for €0.1m are restated.

U N I T E D S TAT E S O F A M E R I C A

From now, commercial discounts and benefits granted to wholesalers are deducted from the revenues in order to display figures in line with the standards of the sector. 2012 and 2013 revenues were restated consequently.

2014 revenues in the USA amounted to €19.9m i.e. a decrease of 5% compared to 2013. That fall is balanced with the rise of So-bieski’s market shares in the key states due to destocking opera-tions.

Based on NABCA figures (control states) the vodka market rose by 2.9% in volume in 2014 whereas the revenues of the group increased by 9.4% (source NABCA, end of December 2014).

weStern europe p&l

lithuania p&l

united StateS of ameriCa p&l

€ 000 31 December 2014 31 December 2013 31 December 2012 Evol. 2014/2013 Evol. 2013/2012

Revenues 232 315 257 986 260 208 -10,0% -0,9%


Ebitda 11 941 15 686 7 528 -23,9% 108,4%

EBITDA Margin 5,1% 6,1% 2,9% - 0,9 pt. + 3,2 pt.

Underlying operating profit/(loss) 9 309 12 490 3 962 -25,5% 215,2%


Revenues 60 380 50 708 47 424 19,1% 6,9%

Revenues excluding duties 21 776 17 423 15 420 25,0% 13,0%

Ebitda 2 340 1 927 1 257 21,4% 53,3%

EBITDA Margin 10,7% 11,1% 8,2% - 0,3 pt. + 2,9 pt.

Underlying operating profit/(loss) 1 518 603 380 151,6% 58,8%


Revenues 19 937 20 981 25 253 -5,0% -16,9%


Ebitda (672) 876 (7 313) -176,7% 112,0%

EBITDA Margin -3,4% 4,2% -29,0% - 7,5 pt. + 33,1 pt.

Underlying operating profit/(loss) (978) 749 (7 365) -230,6% 110,2%


In 2014, a decrease in the EBITDA as well as in the EBITDA margin happened due to higher marketing ex-penses in 2014 than in 2013. USA was impacted by the re-billing of Management Fees for €0.2m.

B U LG A R I A

Main activities in Bulgaria include production and mar-keting of Bulgarian Wines.

In 2013, the Group proceeds to a restructuration of its activi-ties with the sale of the Sakar vineyards. That restructuration and a tougher competition as regard prices had a negative impact on the activity and the profitability of the Group during 2014.

Consequently, in 2014, the Group recorded a fall in its reve-nues of -8.7% as well as a decrease of -6.3% of its EBITDA. The operating income, even negative, is improved by 82.8% com-pared to 2013.

Following the restructuration of its activities in Bulgaria, its staff decreased from 246 at the beginning of 2014 to 150 at the end of 2014.

B R A Z I L

2014 revenues in Brazil amounted to €5.1m i.e. a de-crease of 4.4% compared to 2013. Excluding the currency effect, sales were up by 3.4%.

The final quarter of 2014 was affected by the increase in excise duty in the state of Rio on 1st November 2014.

OT H E R A R E A S

That lot gathers the other geographical areas of the Group that were consolidated or that were made asleep du-ring the year 2014.

2.2.3 Consolidated financial structure as of 31 December 2014

Operating assets and liabilities

N O N - C U R R E N T O P E R AT I N G A S S E T S

The Group’s main fixed assets consist of intangible as-sets (goodwill and trademarks).

Group goodwill is mainly assigned to the France region (almost 81% of total goodwill at 31 December 2014). These amounts originate from the recognition of goodwill at the time of the 2006 acquisition of the sub-group consisting of MBRI and its subsidiaries. The reduction in the amount of goodwill during the financial year 2014 is primarily due to the restructuration operations of the legal organization in Poland.

In accordance with IAS 36, an assessment of the recoverable value of the goodwill was carried out at 31 December 2014.

brazil p&l

other areaS p&l

bulgaria p&l


Revenues 5 705 6 246 9 104 -8,7% -31,4%


Ebitda (1 611) (1 719) (2 699) 6,3% 36,3%

EBITDA Margin -28,2% -27,5% -29,6% - 0,7 pt. + 2,1 pt.

Underlying operating profit/(loss) (401) (2 329) (5 161) 82,8% 54,9%


Revenues 6 643 7 069 7 416 -6,0% -4,7%


Ebitda 1 148 1 333 1 581 -13,8% -15,7%

EBITDA Margin 22,6% 25,1% 28,1% - 2,5 pt. - 3,0 pt.

Underlying operating profit/(loss) 936 1 284 1 325 -27,1% -3,1%


Revenues 2 857 8 717 6 188 -67,2% 40,9%

Revenues excluding duties 2 857 8 717 6 188 -67,2% 40,9%

Ebitda (111) 1 491 (603) -107,4% 347,3%

EBITDA Margin -3,9% 17,1% -9,7% - 21,0 pt. + 26,8 pt.

Underlying operating profit/(loss) (127) 1 251 (987) -110,2% 226,7%


Impairment tests were performed for the following re-gions during the 2014 financial year:

- France- Poland- Lithuania

No impairment was recorded in respect of the 2013 financial year based on the goodwill impairment tests.

The Group’s trademarks, which are displayed under intangible assets and account for most of that item, amounted to €102.4 million at 31 December 2014 i.e. stable over the period.

The reduction in the “Brands” item was primarily due to the sale of the Danzka vodka brand on 10 April 2013.

In accordance with IAS 36, an assessment of the recoverable value of the trademarks (intangible assets with an indefinite life) was performed on 31 December 2014. That analysis enabled to confirm the value of Group’s trademarks as at 31 December 2014.

Most of the trademarks to which a value has been assigned on the balance sheet are those belonging to the Marie Brizard unit (which was acquired by the Group in 2006) and to its subsidiaries.

Tangible assets amounted to €42.9m as at 31 December 2014 compared with €51.7m as at 31 December 2013. This reduction is primarily linked to amortizations over the period and sales of tangible assets.

There were no important investments in 2014. Most of the investments were made for the improvement or the renewal of production tools.

W O R K I N G C A P I TA L

As at 31 December 2014, Working Capital 1 (inventories + receivables – payables) amounted to €112.1m to compare with €170.2m as at 31 December 2013. That fall of €58.1m is due to actions targeted to improve that item such as:

- Rationalize inventory levels in Poland, Spain and France;

- Setting up factoring and a more aggressive dunning notices policy;

- Renegotiation of payment conditions with certain suppliers especially in the USA.

Working Capital 2, composed of the other items of Working Capital, is impacted negatively by the reduction of tax and social debts. That reduction is mainly corresponding to the Polish enti-ties from which the excise duties to pay were particularly high at the end of 2013 due to a strong production at the end of the year in order to anticipate the rise of excise duties at the beginning of 2014.

F I N A N C I A L A S S E T S

The decrease of financial assets is mainly due to the

ConSolidated finanCial StruCture aS of 31 deCember 2014

€ 000 31/12/2014 31/12/2013 31/12/2012

Goodwills 29 932 30 646 30 768

Intangible assets 110 900 111 240 131 734

Tangible Assets 42 922 51 653 79 475

Financial assets 1 624 5 767 9 002

Other non-current assets 3 393 5 586 34 979

Non-current Assets 188 771 204 892 285 957

Current Assets 223 613 291 696 252 039

Cash and Cash Equivalents 77 184 36 470 28 175

Current Assets 300 797 328 167 280 214

Assets held for sale 5 877

TOTAL ASSETS 495 445 533 059 566 172

€ 000 31/12/2014 31/12/2013 31/12/2012

Total Equity 199 184 221 385 -299 002

Long term borrowing - part due > 1 year 2 202 2 353 3 375

Other non-current liabilities 116 538 127 281 59 214

Non Current Liabilities 118 740 129 634 62 589

Long term borrowing - part due < 1 year 1 112 1 480 540 198

Short term borrowings 32 321 13 510 23 818

Other Current Liabilities 139 328 167 050 238 568

Current Liabilities 172 761 182 040 802 585

Liabilities held for sale 4 760

Total Equity and Liabilities 495 445 533 059 566 172


reimbursement of an escrow account linked to the sale of the Danzka brand.

OT H E R N O N - C U R R E N T A S S E T S

As at 31 December 2014, the reduction of the item “other noncurrent assets” is mainly due to the merger of “Distilleries Françaises” with Marie Brizard and to the sale of CI Nolet & Co. Before 2014, those companies were re-corded as “Equity Affiliates”.

N O N - C U R R E N T L I A B I L I T I E S

Non-current liabilities include employees benefits, pro-visions for risks and charges, deferred tax liabilities and non-current liabilities linked to the continuation plan.

Non-current liabilities are detailed in Note 6.6. in the Notes to the Company’s consolidated financial statements for the financial year ended 31 December 2014.

The went from €71.5m as at 31 December 2013 to €61.7m as at 31 December 2014, or a decrease of €9.8m linked to the reclas-sification of less than one year items with the current liabilities.

E Q U I T Y C A P I TA L A N D N E T F I N A N C I A L D E B T

Situation of equity capital and net financial debt is de-tailed thereafter.

C A S H A N D R E S O U R C E S

Equity capital amounted to €199.2m in 2014 to compare with €221.4m in 2013. That evolution is due to the loss re-corded in 2014.

Most of the financing for operating capital expenditure and short-term requirements is arranged locally by the various Subsi-

diaries. The Company also finances Subsidiaries that have limited access to external financing, including Subsidiaries where the bu-siness is in the development phase.

2.2.4 Activities and results of the parent company

Annual f inancial statements of BELVEDERE SA for year ended 31 December 2014 are characterized by:

- A net position of €179.6m decreased by €8.6m compared with €188.3m in 2013 due to the loss recorded in 2014;

- Other debts amounted to €134.1m and are mainly com-posed of frozen debts in the frame of the continuation plan;

- Fixed assets amounted to €328.6m as at 31 December 2014 and were mainly composed of financial assets from which Marie Brizard & Roger International shares, Sobieski Spolka shares and loan granted to other companies of the Group.

The operating result is a loss of €9.9m. That operating loss means that, as a Holding, Belvédère SA does not rebill to its sub-sidiaries the whole part of its running expenses through Mana-gement Fees.

The financial result is a loss of €4.9m. The financial incomes from participations and related receivables for €5.7m do not ba-lance totally the net impact of the changes in provisions on secu-rities and current accounts for €-10.6m.

Consequently, 2014 ended with a net loss of €-8.6m largely inferior to that of 2013.

information on Company’S Capital

€ 000 31/12/2014 31/12/2013 31/12/2012

Cash and cash equivalents -77 184 -36 470 -28 175

Short term financing 32 321 13 510 23 818

Short term capital -44 863 -22 960 -4 357

FRN 441 288

OBSAR 90 102

Other Financial debts 3 313 3 833 12 184

Long term financial debts 3 313 3 833 543 573

Amounts deposited in FRN & OBSAR accounts 1 -3 949

Long term financial debts adjusted for the amounts deposited 3 313 3 833 539 625

Equity Capital 199 184 221 385 -299 002

Long term Capital 202 497 225 217 240 623

1 The amounts paid in connection with the FRN and OBSAR liabilities under the 1st instalment of the Safeguard Plan were not recognized as a decrease in financial debt but

as an increase in non-current financial investments, this was due to the fact that they were deposited in escrow accounts.


2.3 Latest events and out-looks

2.3.1 Reimboursement of a carry-back recei-vable of € 31 million

In February 2015, Belvédère announced that it had ob-tained confirmation that it will receive the reimbursement of a carry-back receivable of €31m. It was informed by the Large Corporates Division of the Direction Générale des Finances Publiques (Public Finances General Directorate) that its request for the reimbursement of this receivable had been accepted.

As expected by the Group’s Management, the sum of €31m was returned to Belvédère on 26 February 2015.

2.3.2 Sale of assets in Belarus

In the frame of its divestment of activities in Belarus, Belvédère forecasts to sell in the near future its participa-tion in the Belarus subsidiary named “Galiart” and in the short term the real estate assets located in Minsk.

2.3.3 Threshold crossings of Diana Holding and DF Holding

S H A R E H O L D I N G T H R E S H O L D D I S C LO S U R E A N D D E C L A R AT I O N O F I N T E N T BY D I A N A H O L D I N G ( 1 S T A P R I L 2015 ) :

- By mail received on 1 April 2015, the limited liability company governed by Moroccan Law “Diana Holding” 1 (“Domaine Zniber, Ait Harzallah, Province d’El Hajeb, Wilaya de Meknes Tafilalet, Maroc”) declared that, on 26 March 2015, it went above the threshold of 15% of the ca-pital and of the voting rights of the company Belvédère and that it owned 4.400.000 shares of Belvédère (same amount of voting rights) representing 16.61% of the capital and 16.47% of the voting rights 2.

This threshold crossing is a result of the acquisition of shares on the market.

Regarding Article 223-14 III and IV of the general regulations of the AMF, “Diana Holding” stated that it owned:

- 100.000 warrants (BSA) to be exercised before 23 April 2018 and giving access to around 0.38 Belvédère shares when exerci-sing 3 warrants minimum to the price of €23.82 per share.

- 3.000.000 warrants (BSA), to be exercised before 31 De-cember 2016 and giving access to around 0.03 Belvédère shares 3 to the price of €20.01 per share.

In the same mail, the following declaration of intent was rea-lized:

« In accordance with articles L. 233-7 of the Commercial Code and 223-17 of the general regulations of the AMF, “Diana Hol-ding” stated for the next 6 months:

- That the acquisitions ending in the threshold crossing above described were financed through a long term bank loan backed by equity and assets of the Group Diana Holding;

- That is not acting in concert with a third party through the company Belvédère;

- That it does not exclude to pursue acquisitions of Belvédère shares, according to market conditions,

- That it does not exclude to take control of Belvédère accor-ding to Article L.233-3 of the “Code du Commerce” because it may effectively – in the long term - be in the situation of deter-mine “actually, through the voting rights which it owned, the de-cisions in the General Meetings of that company” but that it does not forecast to cross a threshold in capital or in voting rights that would mandate it to take over the company;

- That it confirms as a professional player of the wine market that it wants to set up industrial and commercial partnerships with the company Belvédère, in order to develop the potential synergies implying that a sufficient representation to the Board of Directors is settled.

- According to this, outside the nomination of Rita Maria Zni-ber as a member of the Board of Directors (decided during the General Meeting of Shareholders that took place in 16 September 2014) and the co-option of Mehdi Bouchaara as a member of the Board of Directors (decided during the Board of Directors that took place in 24 October 2014), it asks to the Board of Directors of Belvédèr to co-opt Serge Heringer as soon as possible, whose application was submitted in October 2014. Given that Serge He-ringer has a status of standing invitee to the Board of Directors and to the Audit Committee does not give him the possibility to participate in decisions.

Besides, Diana Holding stated:- that it has no intention to set up an operation referred to in

Article 223-17 I, 6° of the general regulations of the AMF;- that is does not belong to agreements or instruments men-

tioned in 4° et 4° bis of I of Article L. 233-9 of the Commercial Code

- That it has not conclude any agreement regarding the re-verse transactions of Belvédère shares or voting rights

1 : Controlled by Zniber Family.2 : Based on a capîtal composed of 26,486,477 shares and of

26,721,879 voting rights according to alinea 2 of Article 223-11 of the AMF rules.

3 : It is indicated that the number of share would be rounded to the nearest whole number and a compensation would be given in cash.

S H A R E H O L D I N G T H R E S H O L D D I S C LO S U R E BY D F H O L D I N G ( 13 T H M AY 2015 ) :

- By mail received on 13 May 2015, completed by a mail received on 15 May 2015, the limited liability company go-verned by Luxembourg Law “DF Holding” 1 (34-38 ave-nue de la Liberté, L-1930 Luxembourg, Grand Duché du


Luxembourg) declared that, on 13 May 2015, it went above the threshold of 5% of the capital and of the voting rights of the company Belvédère and that it owned 1,500,000 shares of Belvédère (same amount of voting rights) re-presenting 5.66% of the capital and 5.61% of the voting rights 2.

1 : Controlled by Castel family.2 : Based on a capîtal composed of 26,486,621 shares and of

26,748,958 voting rights according to alinea 2 of Article 223-11 of the AMF rules.

2.3.4 Executive Committee

Belvédère SA announced on 14 April 2014 the compo-sition of its Executive Committee, headed by CEO Jean-Noël Reynaud.

- Odile Laurent, Human Resources Director

Odile Laurent has acquired close to 15 years of experience in Human Resources Management on an international level, within the industrial sector, notably at Delphi, Alstom, Areva T&D and Sanofi as business unit or regional HR Director. Most recently, she was the group Human Resources Director at ESI group. She joined the Belvédère group in January 2015.

- Alain Degand, Chief Purchasing Officer

Previously Purchasing Director at Bormioli Rocco BU Perfume-ry, Alain Degand joined the Belvédère group in March 2013. He has accumulated 20 years of experience at Roquette Frères, Arc International, with almost a decade in the food and glass sectors.

- Aymeric Donon, Chief Financial Officer

Aymeric Donon began his career at Mazars, where he was no-tably responsible for the auditing of spirits groups. He was then CFO for the Vranken-Pommery Monopole group, joining the Bel-védère group in November 2014.

- Stéphane Laugery, Legal Director and Corporate Secretary

Tax and Legal Affairs Director at Norbert Dentressangle and then Dentressangle Initiatives, Stéphane Laugery was notably Deputy Group Legal Director at Rémy Cointreau. He joined the Belvédère group in March 2015.

- Stanislas Ronteix, Chief Marketing Officer

Marketing General Manager of Bisquit Cognacs within Sou-th African group Distell, Stanislas Ronteix notably had global responsibility for Rémy Martin VSOP at Rémy Cointreau and has more than 15 years of experience in the wine and spirits sector. He joined the Belvédère group in September 2014.

- Daniel Rougé, Chief Operations Officer

Daniel Rougé has more than 30 years of experience in the agri-food sector, notably in drinks where he was In-dustrial Director and Factory Director at Candia Sodiaal,

Orangina Schweppes, Teisseire and Boisset. He joined the Belvédère group in November 2014.

2.3.5 Legal Simplification with the merger between Marie Brizard & Roger International and William Pitters International (April 2015)

In order to rationalize the number of legal entities com-posing the Group and following the authorization given by the Board of Directors, a simplified merger between “Marie Brizard & Roger International” and “William Pit-ters International” was realized.

Thus, on 8 April 2015, the CEO of the company « Marie Brizard

& Roger International » recorded (i) that the conditions precedent (written in the draft of the merger agreement concluded with its subsidiary William Pitters International as of 23 February 2015) were satisfied and (ii) the definitive completion of the merger and the anticipated dissolution without liquidation of the company William Pitters International.

2.3.6 Sale of the retail business in Poland

On 19 May 2015, the Group announced that it had di-vested its retail activities in Poland named Galeria Alko-holi.

As foreseen by its BiG 2018 strategic plan, BELVEDERE intends to divest its assets that are no longer core business. The Group has thus divested Galeria Alkoholi, a company comprising 39 li-quor stores in Poland, to Carrefour.

This divestment has been approved by the relevant authori-ties in France and Poland.

The sale price has not been made public, and the sales re-corded by Galerie Alkoholi will cease to be consolidated in the Group’s accounts from 13 May 2015.

2.3.7 Litigation

Two proceedings have been initiated in the USA against the company and its local subsidiary named Imperial Brands following the request of a former member of the Management of the Group. They asked for the payment of a bonus subsequently to the sale of the company Florida Distiller realized in 2011.

A transaction has been concluded with that person on 8 May 2015.

2.3.8 2015 outlooks

- Revenues of Q1 2015: +4.4% on a like-for-like basis:

During Q1 2015, Belvédère had consolidated revenues of €95.6m stable compared to revenues of Q1 2014 but increasing by 4.4% compared to revenues of Q1 2014 on a like-for-like basis.


- Market shares in the key countries of the Group for Q1 2015:

- William Peel in France: 22.5% of market share (source: Nielsen P03 2015)

- Krupnik in Poland: 12.2% of market share (source: Nielsen P03 2015)

- Fruits and Wine in France : 28.6% of market share (source IRI P03 2015, BABV)

- Sobieski in the USA : 2.8 % of market share (source Nielsen 13 weeks as 28 March 2015, Imported vodkas)

- Status of BiG 2018 plan and midterm outlooks:

During Q1 2015, Belvédère began to set up its strategic plan named “BiG 2018”.

Regarding rationalization subjects and especially the sale of non-core assets, Belvédère has set up an active strategy and the sale processes are ongoing.

As stated before in this report, Belvédère announced on 19 May 2015, that it had divested its retail activities in Poland named Galeria Alkoholi.

Regarding optimization subjects and especially the set-up of best industrial, purchase and marketing practices, Belvédère has begun to set up main projects. For example, regarding industrial practices, Belvédère has instigated improvements works for its productions tools for Vodka in Lithuania. As regard purchases, Belvédère has finalized discussions about supply of scotch and purchasing synergies especially for bottles. Those negotiations enabled to validate the main hypotheses of the Plan.

Finally, as regard Marketing, Belvédère felt a sensitive hea-ring from its partners throughout all its operating markets. Once more, those discussions made reliable the hypothesis of BiG 2018 Plan.

As a consequence, Belvédère is confident with its outlooks and confirms its financial objectives set out in the strategic plan BiG 2018.

2.4 Risk factorsThe Company has reviewed the risks that could have a ma-

terial adverse effect on its business, its financial position and its

results (or on its ability to meet its targets) and believes that there are no significant risks other than those set out below.

Nevertheless, it is reminded to the reader that additional risks to those described hereafter may exist but are not identified at the date of the current document or for which the occurrence is not considered at the current date, as disposed to have an impor-tant unfavorable effect on the company or its subsidiaries.

2.4.1 Financial risk

Risk relating to insolvency proceedings

It is reminded that Belvédère as well as some subsi-diaries having given guarantees to their parent company, in the frame of financing schemes secured in 2006, were respectively placed under court-ordered rehabilitation on 20 March 2012 and 3 July 2012. These proceedings are detailed in Section 2.1 of the Registration Document for 2013, which was approved by the AMF on 31 July 2014 un-der # R14-048.

In a judgement dated 19 March 2013, the Dijon Commercial Court approved the Company’s rehabilitation plan, as presented by the Administrator on 11 March 2013. In its judgement, the Dijon Commercial Court underlined that the plan, as approved, was likely to ensure the long-term future of the business. As a matter of fact, the conversion of the FRN debt for €439m on 19 April 2013 and of the OBSAR (bonds with redeemable warrants) for €93m on 30 October 2013, enabled to delete most of the in-debtness of the Group.

The Belvédère Group paid Fréderic Abitbol, the Administra-tor appointed to oversee the Execution of the Plan, the amounts of the first dividends due on 19 March 2014 for the eight Group companies involved (Belvédère, MBRI, Sobieski, Destylarnia So-bieski, Sobieski Trade, Domain Menada, Destylernia Polmos, and Fabryka Wodek).

Besides, Offset agreements between Belvédère, MBRI and So-bieski were approved by the Administrator appointed to oversee the Execution of the Plan.

Moncigale’s frozen debt was also the subject of a gradual re-payment schedule.

On 16 April 2014, the first plan dividend was paid by Monci-gale to Mr Torelli, the Administrator appointed to oversee the

revenueS of q1 2015: +4,4% on a liKe-for-liKe baSiS

In € m

95,6

4,4%

Q1 2015

95,6 -1,6 -2,4 91,6 3,4 0,6

Q1 2014Abandoned

contractsPerimeter

effectQ1 2014restated


Currency Impacts


Execution of the Plan.

In order to respect the commitments towards Frédéric Abitbol (Administrator appointed to oversee the Execution of the Plan.), the Group set up cash-flows forecasts for the first semester of 2014 that were actualized every month according to operating plans. This process enabled to get visibility on the whole perime-ter in order to anticipate and secure its ability to honor the pay-ments of the rehabilitation plan.

Consequently, on 19 March 2015, second dividend payment due according to the plan was received by Frédéric Abitbol, Ad-ministrator appointed to oversee the Execution of the Plan.

Risk of dilution of the Company’s shareholders

As a reminder, the debt repayment proposals (as des-cribed in Section 2.1 of the Registration Document for 2013, which was approved by the AMF on 31 July 2014 under # R14-048) provided for the issuance of (i) shares with share warrants for the benefit of the FRN Creditor, which resulted in the latter holding an 87% interest in the Company’s share capital, and (ii) share warrants for the be-nefit of the OBSAR bond-holders. In fact, in accordance with the conversion option provided for in the debt repay-ment proposals, which have been implemented, 23,035,184 shares with share warrants were issued to the FRN Credi-tor on 19 April 2013.

Following this capital increase, which was carried out on 19 April 2013, the existing shareholders jointly retained a reduced 13% interest in the Company’s share capital (prior to the exercise of the BSAR share warrants, such as the term is defined in Section 2.1 of the Registration Document for 2013).

The debt repayment proposals also provided for the free award of share warrants to the Company’s shareholders, which would entitle the latter to 10% of the Company’s share capi-tal, prior to the exercise of the BSAR warrants and of any other share warrants issued by the Company. The warrants (BSA) were granted on 19 April 2013.

The dilution used to determine the percentage of the share capital to which the Warrants (BSA) granted to historical sharehol-ders was an estimate and did not take into account the possible dilution from the exercise of the BSARs. As a result, exercising Warrants (BSA) may not enable to correct the dilutive impact for historical shareholders due to the occurrence of the other tran-

sactions referred to in the debt repayment proposals.

Beside those operations related to the debt repayment pro-posals, it is indicated that the Board of Directors gathered on 12 March 2015 decided the allocation of 9,320 free shares and 480,000 stock purchase or subscription options to some em-ployees and Directors of the Group.

As a conclusion, the dilutive instruments are summarized in the following table:

Risk relating to the valuation of goodwil and trademarks

During the preparation of the parent company and consolidated financial statements for the 2014 financial year, the Group’s management estimated the values of the Group’s goodwill and trademarks, in accordance with ap-plicable accounting standards and principles. In essence, these estimates are based on assumptions. Accordingly, the assumptions used by the Group’s management may subse-quently turn out to be inaccurate, which would have an im-pact on the level of expenses shown in the parent company and consolidated financial statements of the Company.

An assessment of the recoverable value of the goodwill and trademarks was carried out on 31 December 2014, in accordance with IAS 36. The recoverable value of one Cash Generating Unit (CGU) is the higher amount between its fair value minus sale costs and its value-in-use.

The value-in-use of the CGUs is determined based on dis-counted future cash flows. It is calculated according to parame-ters arising from the budget and forecast preparation process over a maximum period of five years, including growth and profitability rates that are considered reasonable. Management uses discount and long-term growth rates, based on the sector in which the Group operates, in order to estimate the value-in-use of the CGUs.

Furthermore, the process launched as part of the court-orde-red rehabilitation proceedings led to bids being submitted for several of the Group’s business segments. The offers received appeared to be heavily discounted and did not reflect the real market value of the goodwill and trademarks, or correspond to bids that would have been made as part of a conventional dis-posal process. Accordingly, Management viewed these bids as inadequate, a stance that was confirmed by the Dijon Commer-

dilution of the Company’S ShareholderS

31 December 2012 31 December 2013 31 December 2014 Date of publication

Number of shares composing the capital 3 405 679 26 486 213 26 486 482 26 486 621Potential dilutive effect of stock warrants issued in 2004 585 262 643 788 643 788 643 788Potential dilutive effect of stock warrants issued in 2006 130 135 99 521 99 521 99 521

Potential dilutive effect of stock warrants issued to historical shareholders 2 634 771 2 634 502 2 634 363Potential dilutive effect of stock warrants issued holders of subordinated bonds 2 572 093 2 572 093 2 572 093

Potential dilutive effect of free shares 2015 9 320Potential dilutive effect of stock warrants issued in 2015 to employees and managers 480 000

Total number of potential shares 4 121 076 32 436 386 32 436 386 32 925 705

Dilutive effect 17.36% 18.34% 18.34% 19.56%


cial Court, which rejected them on that basis. Therefore, the va-lues proposed under the terms of the bids have not been taken into account.

The valuation of the goodwill and trademarks used in the fi-nancial statements for the year ended 31 December 2014 is the result of Management assumptions for business volumes (reve-nue growth, trend in gross profit margins, and operating mar-gins). These assumptions rely on the fact that the Group will be able to conduct its business activities under normal business and legal conditions.

Currency risk

- Currency risk relating to financial debt denominated in foreign currencies

The Group consolidates the financial statements of its subsi-diaries in Euro. Most of the subsidiaries have a different currency than Euro.

Given the size of the operations, the currency risk relating to the conversion of the financial statements primarily relates to fluctuations in the Polish zloty (PLN) and the US dollar (USD). Ac-cordingly, the conversion of the Subsidiaries’ financial statements into euros could have an impact on the Group’s results.

Where debt is concerned, the Group prioritizes local financing (primarily working capital financing) in the same currency as the one in which the borrower company operates. The impact of cur-rency fluctuations on debt therefore remains limited.

- Currency risk relating to commercial transactions

Currency risk relating to commercial transactions (exchange rate fluctuations recorded on transactions in a currency other than the companies’ operating currency) is also limited.

In fact, purchases and sales to non-group third parties are mostly performed on the Group company’s local market, and the-refore in a currency that is the same as its operating currency. In-tra-group transactions involve exposure to currency fluctuations: this exposure primarily relates to the Polish Subsidiaries’ exports to the US Subsidiary, and to the Bulgarian Subsidiaries’ exports to the Polish Subsidiaries. No currency hedge has been arranged for intra-group transactions.

The main foreign currency transactions, except for intra-group transactions, concern the purchase of whisky in Pounds Sterling (GBP) by William Pitters (a subsidiary of Marie Brizard & Roger International). William Pitters uses EUR/GBP currency hedges in order to secure the cash flows relating to these purchases.

2.4.2 Business-related risk

Risks relating to trademarks and intellectual proporty

The Group owns virtually all the trademark portfolio that it uses in its business activities. It is not dependent upon any other group in this respect. The Group owns se-

veral brands that it considers to be crucial for the conduct of its business activities, inasmuch as these brands specifi-cally contribute to customers’ loyalty to the Group.

The Group’s main brands are as follows:- in Poland: Sobieski, Krupnik, Starogardzka, Polonaise, Krako-

wska, Zawisza, and Wisent;- in Lithuania: Sobieski, Bajoru, Admiral, Karvedys, Cepkeliu;- in Bulgaria: Domain Menada, Sakar, Tcherga, and Oriachovit-

za;- in Western Europe: Marie Brizard, William Peel, Sobieski, Old

Lady’s, San José, Berger, and Manzanita;- in the United States: Sobieski;- in Brazil: Genebra Zora, Fogo Paulista, Zvonka, Fenetti, and

Lautrec.

The reputation of the Group’s brands is a key factor for its competitiveness. Moreover, the Group is exposed to the risk of counterfeiting, as well as to the risk of unfair competition.

To protect itself against these risks, the Group makes substan-tial investments aimed at managing and protecting these brands, as well as its intellectual property rights on a more general basis.

Each subsidiary is responsible for managing any litigation (counterfeiting, unfair competition, obsoleteness, and objections, etc.) and contracts (sales, licensing and co-existence) that give rise to intellectual property issues. The Group makes extensive use of legal intellectual property advisors and specialists of the fight against counterfeiting.

Risks relating to brand image and reputation

The brand image of the Group’s products makes a subs-tantial contribution to the development of its business activities. In fact, it has a direct effect on the behavior of consumers, as well as on the behavior of the distributors of the Group’s products. As a result, any event that may harm this brand image is likely to lead to a decrease in the Group’s sales.

The insolvency proceedings in which the Group was involved since 2008 have resulted in, and are likely to continue to result in negative consequences for the Group’s image.

Risks relating to changes in regulations

The Group has operations in a lot of countries. As a re-sult, its business activities are subject to a wide variety of local regulations regarding products containing alcohol, especially with regard to the sale of alcohol (importing, distribution and competition), advertising (marketing and labelling) and the environment.

This regulatory environment is likely to change in the coun-tries in which the Group operates, whether it is in France, the Eu-ropean Union or the rest of the world. Such changes to the legal and regulatory requirements could have a negative effect on the Group’s activities (restrictions on the launch of new products, or a slowdown in product sales, for example), more specifically in view of the following considerations:


- Restrictions on the advertising and promotion of the Group’s products: certain countries in which the Group operates impose restrictions on the advertising of alcoholic beverages. This is spe-cifically the case of the so-called “Evin” Law in France. The aim of these restrictions is to protect consumers from being influenced by the advertising and promotion of products containing alcohol. All forms of advertising for alcoholic beverages are prohibited in Poland, except in specialized sales outlets and magazines.

- A further tightening of the regulations in countries where the Group has significant operations could influence consumers’ behavior, and distance them from the Group’s products, which would have a negative impact on business activities.

- Taxes on spirits: the Group’s various products are often sub-ject to import taxes, which vary depending on the country, as well as to excise duties. As an example, the increase in excise du-ties on strong alcohol that came into force in France on 1 January 2012 had a serious impact on retail prices. Such changes could lead to a decrease in the consumption of the products marketed by the Group.

- Bottle labelling regulations: new regulations in this area (in-cluding those imposing consumer health warnings and exten-ding the term of the registration process for new products) may reduce the attractiveness of the Group’s products in the eyes of consumers and, consequently, result in a reduction in sales of those products. These changes could result in an increase in costs, which is likely to affect the Group’s results.

- Authorizations and controls: given its business activities, the operation of all of the Group’s facilities is subject to authoriza-tions and specific controls according to the local regulations in place.

The disrespect of local regulations may lead to legal and ad-ministrative sanctions. The evolution of regulations as a matter of production and commercialization of alcoholic beverages may lead to additional constraints and to an increase of expenses.

Commercial dependency and customer risk

Commercial dependency and customer risk are prima-rily due to the contracts that the Group has signed with mass retailers. The concentration of the mass retail sector may limit the negotiating power of Group companies, and therefore the Group’s room for manoeuvre in terms of its pricing policy, which may consequently affect the Group’s results.

In France, Moncigale generated an important part of its 2014

revenues with the Casino Group, its main customer.

In the United States, legislation on the distribution of products containing alcohol has produced a concentration of the Group’s customers.

Dependency on suppliers and supply risk

The glass manufacturing sector (which supplies the Group’s bottle manufacturing facilities) is dominated by a limited number of operators; even though the Group works with several of these operators, this concentration makes the Group highly dependent on them.

In the case of Scotch whisky, which is primarily marketed un-der the William Peel brand and accounts for a very significant portion of business volumes in France, the Group has entered into multi-year supply agreements in order to protect itself from fluctuations in purchase prices, and to guarantee sufficient amounts for its commercial requirements.

Risks relating to the competition

The markets in which the Group operates are highly competitive and very fragmented in terms of price, ser-vices, brand awareness, and product quality. The operators with whom the Group competes include large internatio-nal wine and spirits groups and local distributors on some markets.

The vodka market is highly price-sensitive. Price promotion is one of the sales techniques that are used most frequently by pro-ducers and distributors.

To stand out in this competitive environment, the Group has always placed a strong emphasis on developing the image of its leading brands, which implies on-going advertising and mar-keting support. The Group had entered into a partnership with Bruce Willis, the American actor and producer, in 2009 to boost the reputation of its international Sobieski vodka brand. This partnership ended in early January 2014.

Seasonality

The sale of spirits has traditionally been a seasonal bu-siness. Generally speaking, the Group generates a signi-ficant portion of its sales during the year-end holidays (except for sales in Southern Hemisphere countries like Brazil, where sales increase in June, July and August). This phenomenon primarily affects the vodka business. As an illustration, sales recorded in the fourth quarter over the

SeaSonality

in €m % in €m %

Q1 114.9 21% 99.2 21%Q2 140.1 26% 123.5 26%Q3 137.9 26% 119.9 26%Q4 146.7 27% 124.1 27%

Full Year 539.6 100% 466.7 100%

2013 2014Net sales, excluding excise duty


last two financial years accounted for 27% of average an-nual sales while sales in the first quarter accounted for an average of 21%.

Conversely, this rule does not apply to sales of rosé wine, which are high in June, July, and August.

Accordingly, any exceptional event that occurs during the year-end holiday season could have a material impact on the Group’s results for the financial year in question.

Risks relating to the economic environment and to changes in consumption patterns

The Group’s business activities and the consumption of alcoholic beverages are directly affected by the global eco-nomic environment.

During economic downturns, wine and spirits consumption levels tend to decrease because their consumption is directly correlated with the fall in consumer expenditure and with the increasing cost of living and inflation.

Generally speaking, such effects are offset by the diversified geographical breakdown of the Group’s sales (Western Europe, Eastern Europe and the United States), and by the variety of its product portfolio.

2.4.3 Industrial and environmental risks

Most of the production companies of the Group are exposed to industrial and environmental risks. General-ly speaking, the regulatory compliance of the sites is a priority subject for the Group. Each subsidiary monitors changes in environmental standards with the authorities involved at the various locations and in the various geo-graphical regions.

Every production location of the Group:

- Is certified according to the international standards: ISO 9001 certification,

- Have adopted the HACCP (“Hazard Analysis and Critical Control Points”) standard, an international method for implemen-ting a system designed to ensure that consumed food stuffs pose no risk to health. The standard involves identifying threats, asses-sing the risk of such threats occurring, and defining critical issues.

2.4.4 Legal and other risks

Legal and arbitration proceedings

The Group’s companies may face legal proceedings from service providers and consumers, etc. as part of their bu-siness activities. If the Group’s brand image is jeopardized, or if such litigation needs the payment of fines or other pe-nalties such as damages and interest, the Group’s business activities may be materially affected.

Legal proceedings initiated in France

CO M M E R C I A L P R O C E E D I N G S

Moncigale, a Belvédère sub-subsidiary, and Chamarré entered into an exclusive licensing agreement regarding the use, production, and distribution of the Chamarré still wine brand for a period of 10 years on 17 August 2010. Under the terms of this agreement, Moncigale committed to pay Chamarré an annual royalty indexed on the volumes sold and the revenues generated by products sold under the Chamarré brand. The agreement provides for payment of a minimum guaranteed royalty to Chamarré by Monci-gale every year.

The Nimes Commercial Court opened a safeguard proce-dure in favor of Moncigale on 16 June 2011. This procedure was converted into court-ordered rehabilitation proceedings by the same Court on 21 September 2011. The Court appointed an ad-ministrator to assist the company.

On 9 November 2011, the Administrator informed Chamarré of the definitive termination of the agreement pursuant to the provisions of Article L. 622-13 of the French Commercial Code.

As part of the court-ordered rehabilitation proceedings ope-ned in favor of Moncigale, and of the statement of liabilities drawn up on the date when the proceedings opened, Chamarré lodged a receivable claim amounting to €10.7 million with the creditors’ representative on 30 August 2011; this amount corres-ponds to the total royalties guaranteed over the 10 years of the agreement, and to an estimation of the other obligations arising from the agreement.

Chamarré lodged an additional claim “for damages and inte-rest” amounting to €20 million on 6 December 2011, following the notice that the agreement had been breached.

These claims were disputed by the company, and were stayed by the Nîmes Commercial Court pending the decision of the Pa-ris Commercial Court. In fact, proceedings against the bodies in charge of the Moncigale insolvency proceedings were initiated by the Official Receiver for Chamarré in the Paris Commercial Court via a summons on 8 February 2013.

Chamarré was placed under court-order rehabilitation procee-dings on 31 May 2012, and its entry into liquidation proceedings was announced on 5 June 2012.

On 29 May, 2013, in parallel with these initial proceedings, Mr Torelli, the Administrator responsible for Executing the Monci-gale Plan, applied to the Nîmes Commercial Court and the State Prosecutor for the termination of Moncigale’s court-ordered re-habilitation plan, and to initiate insolvency proceedings against Moncigale on the grounds of failure to execute the plan.

The application stated that the plan, as drawn up by the jud-gement of 16 April 2013, had not been complied with, as the company had not paid a monthly amount calculated on the lia-bilities agreed, which had been opposed in the judgement, as it was expected to do.


The Nîmes Commercial Court ruled on this application on 21 August 2013 and stayed it pending the outcome of the procee-dings in the Chamarré case.

In a judgement dated 6 February 2014, the Paris Commercial Court ruled that it did not have the appropriate jurisdiction; since this ruling has now become final, the case will now be heard in the Nîmes Commercial Court. The hearing was initially scheduled for 9 April 2014 and was deferred to 2 July 2014, then to 17 Sep-tember 2014 and finally to 24 June 2015.

P R O C E E D I N G S I N V O LV I N G T H E F R E N C H F I N A N C I A L M A R K E T S AU T H O R I T Y ( A M F )

The AMF Sanctions Commission has initiated procee-dings against the Company on the grounds of breach of its obligation to inform the public, and of failing to report transactions in its own securities as well as the crossing of thresholds, and also against Sobieski SARL and SVI on the grounds of failing to report transactions in the Company’s shares. These accusations were disputed by the Company, Sobieski SARL and SVI.

On 30 April 2014, the AMF Sanctions Commission requested the application of the following sanctions against Belvédère SA, Sobieski SARL and SVI and condemned them to a €150,000 fine and fines of €45,000 for Sobieski and €15,000 for SVI. In accor-dance with the established practice, this decision is available on AMF’s website.

The 3 companies made appeal regarding that decision and the procedure is still on going before the Paris Court of Appeal. Hearing is expected on 14 January 2016.

P R O C E D I N G S I N V O LV I N G M . E R I C K A N TO N Y S KO R A

M. Erick Antony Skora assigned the company Marie Brizard & Roger International before the Creteil Commer-cial Court as of 3 February 2015. He claims the payment of an end-of-service allowance for €458k and the financial counterpart of its non-competition clause according to the terms of a contract named “non-competition commitment” for an amount of €317k. He claims also the payment of €100k for moral prejudice due to wrongful exercise of right to revoke by Marie Brizard & Roger International and €27k for material prejudice. The total amount of claims is of €917k.

The company Marie Brizard & Roger International is contes-ting the validity of those claims. That proceeding is currently pen-ding before The Creteil Commercial Court.

Proceedings initiated in Poland

P R O C E E D I N G S I N V O LV I N G T H E K R U P N I K B R A N D

Proceedings involving the Krupnik brand were initiated by a Group Subsidiary, Destylarnia Sobieski, against Too-

rank Polska Sp. z.o.o, for illegal use of said brand. The Subsidiary, which owns the Krupnik brand, believes that Toorank Polska Sp. z.o.o is marketing products under that brand name.

An initial letter of warning was sent to Toorank Polska Sp. z.o.o but had no effect. Consequently, the Subsidiary decided to ini-tiate proceedings against Toorank Polska Sp. z.o.o in the Lublin Court on the grounds of unfair competition, and breach of exclu-sive rights to a registered brand.

Toorank Polska Sp. z.o.o stated that Krupnik, registe-red under the name of Destylarnia Sobieski since 1997, had no validity as a verbal trademark since that word is used as the usual denomination for honey spirits in Poland and has no distinctive form. Toorank Polska Sp. z.o.o stated that it cannot be registered as a trademark with exclusive rights.

The Polish Patents Office took into account the arguments of Toorank Polska Sp. z.o.o and cancelled the Krupnik verbal trade-mark on 3 October 2012. This decision was upheld in a judge-ment issued by the Voievodie Appeal Court on 22 January 2014. Then, the Supreme Administrative Court ruled that the appeal brought by the company Destylania Sobieski was not receivable. The invalidity of the trademark must be considered as definitive.

Nevertheless, that decision should have no effect regarding the proceeding engaged on the grounds of unfair competition that is still on going.

The brand Krupnik associated with graphic elements was registered in Poland and abroad. The other uses of the Krupnik brand (in Poland and abroad) should not be called into question.

Finally, the invalidity of the verbal trademark does not prevent the use by Destylarnia Sobieski of the original bottle with the name Krupnik on it, particularly well known in Poland as well as in other European markets.

Tax risks

Belvédère SA, as well as companies within the tax consolidation group were subject to an examination of its accounts that began on 19 January 2009. For most of the companies, the examination is about income taxes, Value Added Taxes and other taxes for the period from 1 January 2006 to 31 December 2007.

The total amount of tax adjustments amounted to €25.4m (in-creases and deferral interests included) from which €17.9m lin-ked to Income Taxes adjustments, €6.7m linked to adjustments regarding taxes deducted at source, €0.6m linked to social contri-bution adjustments and €0.2m linked to VAT adjustments.

These adjustments are primarily related to the deduction of interest expense connected with the FRN loan (Floating Rates Notes) subscribed for the purpose of the Duke Street/Marie Bri-zard acquisition. That FRN loan is subject to the laws of the State of New York.


The adjustments observed in those proposals of cor-rections, regarding interest expenses of the FRN loan amounted to €15.8m for 2006 and to €28.1m for 2007. Those adjustments incurred recalls regarding income taxes for €15.1m for 2006 and 2007 as well as recalls regarding taxes deducted at source for €5.3m for 2006.

Those adjustments were assessed on April 2012.

The Group objected to those adjustments via an appeal, and lodged claims in the Montreuil Administrative Court. It also asked for a suspension of payments.

On 29 September 2014, two judgments were rendered in the frame of those cases described here before, all unfavo-rable to the company.

Appeals have been lodged against those judgments on 25 Fe-bruary 2015 before the Versailles Administrative Court of Appeal.

The tax receivable should, if it is confirmed, be cleared in the frame of the continuation plan approved by the Dijon Court. Bel-védère is considering that no dividend payment in the frame of the continuation plan can be done to the benefit of the tax admi-nistration until those receivables are considered litigious and not definitively admitted.

In the light of these elements and the confidence of Belvédère on a favorable outcome of this litigation, no provision has been recorded. A provision of €3.5m is still recorded in the financial statements as regard the other adjustments.

In the hypothesis of a rejection of the appeal by the Ver-sailles Administrative Court of Appeal, the Group should pay the amounts due for 2006 and 2007 as described here before. Mo-reover, the Group could be obliged to reimburse the amounts received in the frame of the reimbursement of the carry-back for 2008 for €10.4m. In case of reconsideration of the deductibility of FRN interests for previous financial years, the adjustments would reduce the tax loss carryforward.

It is reminded that Belvédère obtained confirmation that it will receive the reimbursement of a carry-back receivable of €31 m. As expected by the Group’s Management, the sum of €31 million was returned to Belvédère on 26 February 2015.

Country risks

U K R A I N E

Belvédère’s Ukrainian subsidiary, Belvédère Ukraine LLC, was placed in court-ordered liquidation in January 2014, based on a decision by the Kiev Commercial Court following proceedings initiated at the request of one of the company’s creditors in July 2011.

Belvédère holds around 85% of Belvédère Ukraine LLC’s ove-rall debt.

In November 2014, the assets of Belvédère Ukraine LLC (re-gardless of whether this involves the shares in subsidiaries held

by the company that is being liquidated, or the actual assets of those subsidiaries, which are now controlled by the liquidator appointed by the Kiev Commercial Court) were transferred to a third party outside Belvédère’s control.

Regarding several actions of the company, on April 2015, the Kiev Tribunal accepted claims of the Company and invalidated the sale of assets that intervened in November 2014 and ordered the re-opening to the liquidation procedure.

B U LG A R I A

During the first couple of weeks of January 2015, the company recovered the whole ownership of its subsidia-ries and activities in Bulgaria at the end of a legal, diplo-matical and public proceeding following a case opened in November 2014. In that frame, the Bulgarian Justice put companies of the Group under the authority of a court officer according to highly questionable grounds and not applicable with common law.

Sales in Bulgaria represented less than 1% of total revenues of the Group.

The company is now able to operate its activities in Bulgaria despite damages caused by the Court Officer.

The Company is awaiting the nomination by Sofia Tribunal of 3 experts according to the request made by itself and the com-pany AgroTechnology during March 2015, regarding the solvabi-lity of two of its subsidiaries i.e. Domain Menada and Belvédère Distribution. The nomination of 3 experts should occur in the short term.

2.4.5 Insurance and risk coverage

Every Group Subsidiary is required to arrange insu-rance in order to cover its operating risks, the specific risks relating to its business activities, and its civil liability. The insurance policies are subscribed locally and are suited to the country’s specific legislation and risks. There was no pooled management of insurance policies as at the date of the Registration Document but the pooling should be set up during 2015. The main policies of the Group’s major subsidiaries are summarized below.

The Subsidiaries have arranged the following insurance sche-mes in each country:

- Direct damage to property: this cover includes movable and immovable property, such as buildings, machinery and equip-ment;

- Operating loss insurance;

- Civil liability insurance: these schemes are suited to speci-fic local conditions, and provide comprehensive cover (unless there is an exclusion) for any material and non-material damage caused to third parties. In the United States, an “umbrella” policy for the commercial activities relating to the sale of alcohol and


other country-specific obligations has been subscribed. Further-more, Belvédère has subscribed to a specific insurance policy co-vering its corporate officers’ civil liability.

2.4.6 Market risks

Liquidity, Interest Rate and Counterparty risks as well as equity risk are described in Notes 6.5. of the notes to the consolidated financial statements.

2.5 Description of the Group

2.5.1 Description of the Group as at the date of the Registration Document

Belvédère, the Group’s parent company, primarily ope-rates as a holding company, and owns some of the brands marketed by the Group’s subsidiaries.

The Group produces spirits and wines, primarily in Poland, France, Spain, Lithuania and Bulgaria. Some regions have a more specialized production: in Poland and Lithuania, vodkas are the main focus of production, while production in Bulgaria focuses on wines.

2.5.2 Subsidiaries and holdings as at 31 De-cember 2014

The table of Subsidiaries and holdings is published in

the Company’s financial statements for the year ended 31 December 2014.

2014:

3 Ukrainian companies (Belvédère Ukraina, I taliano Ukrainian and Boisson Elite) are out of the consolidation scope. Those companies, from which the commercial acti-vity was largely decreasing and from which the outlooks were compromised, were liquidated on 22 January 2014. The Group having lost control of those entities, they were no more consolidated starting beginning of 2014. In order to hedge its exposure in Ukraine, the Group depreciated whole of its receivables regarding those entities for €4.3m.

Besides, in Poland, the company “Hasis” was merged with Sobieski Trade during the 1st semester of 2014.

On 4 December 2014, the transfer of estate (called “TUP”) of the company ‘les Distilleries Françaises’ to the profit of Marie Bri-zard & Roger International was definitively completed, thanks to the lack of opposition of creditors according to the time limit gi-ven to them.

2013:

There was no change in the consolidation scope during the 2013 financial year.

Please note the change in the percentage interest held in the Bulgarian subsidiaries between 31 December 2012 and 31 De-cember 2013. On 30 September 2013, at a cost of €1, Belvédère bought back a 12.3% stake in Belvédère Capital Management, its Bulgarian subsidiary, from the Polish subsidiary Sobieski Spolka, thereby increasing its interest in Belvédère Capital Management to 100%.

2012:

One company was founded in Latvia in May 2012, na-mely Belvédère Distribution SIA Latvia, a wholly-owned subsidiary of Belvédère Prekyba, the Lithuanian company. This company had no significant business activities in the 1st half of 2012.

In July 2012, Galliart Group, the Belarus company, was foun-ded via a transfer of assets from Galliart, another Belarus com-pany. The former company is wholly-owned by the latter. Galliart Group is intended to serve as the holding company for certain Group real estate assets in Belarus, and conducts no business ac-tivities.

Re-invoicing flows between certain Subsidiaries and the Com-pany are set out in the Statutory Auditors’ special report on the regulated agreements and undertakings for the financial year en-ded 31 December 2014.

Significant minority interests in subsidiaries not wholly-owned by the Group

Dovile Zaromskyte (a private individual) holds 20% of the share capital and voting rights of Belvédère Baltic (Li-thuania), as well as 40% of the share capital and voting

Simplified flowChart aCCording to the main region of aCtivitieS of the group


rights of Belvédère Prekyba (Lithuania).

Skandinaviska Enskilda Banken (Sweden) holds 9.2% of the share capital and voting rights of Vilnius Degtine (Lithuania), while Darius Zaromiski (a private individual) holds 14.8% of the share capital and voting rights, and Dai-va Zaromskiené (a private individual) owns 5% of the share capital and voting rights.

2.6 Investment policy

2.6.1 Industrial policy and incurring challen-ges

The Group owns its industrial real estate assets in most cases. It also benefits from long-term leases arising from the acquisition process for Polmos (distilleries) in Poland: these leases grant the Group a right of usufruct over the land concerned for a period of 99 years.

The Group also owns vineyards in Bulgaria and several real es-tate assets as well as a land in Krakow.

The Group has seventeen main industrial sites with activities of production, distillation, assembly, aging, packaging, and bott-ling. The operating assets of the Group and their maintenance or improvement are major concerns. It constitutes a level of fixed tangible assets of €216.6m as at 31 December 2014.

Most of the Group’s plants are ISO compliant. In the case of sites that are located in urban areas, the risk of pollution or fire is subject to audit and prevention procedures that are formally set down with the regional or district departments concerned. Plants acquired by the Group are renovated and made compliant with environmental, health and safety standards.

The Group implements a responsible environmental policy in each country where it has production sites. To the Company’s

knowledge, there was no industrial process within the Group that could call into question the impact of its activities on the envi-ronment.

2.6.2 Main capital expenditures

The Group’s capital expenditures focus primarily on im-proving and renewing the production equipment.

2.6.3 Main investments to come

In the frame of BiG 2018 plan announced by the com-pany last December, the upgrade of the industrial foot-print is a major challenge. Consequently, some investments have to be made in order to:

- Insource distillation and rectification capacities for vodka production,

- Secure and upgrade Fruits & Wine production,

- Review the industrial footprint for liquor production,

- Reconfigure the logistics network.

For example, in 2015, Belvédère Group forecast investments of approximately €14.9m in order to:

- Move the production site of Bordeaux in existing production sites,

- Improve the distillation / rectification processes in Lithuania,

- Modernize the production capacities for the Fruits & Wine part.

Capital expenditureS amountS during laSt 3 yearS

€ 000 2012 2013 2014

Lithuania 1 118 243 211Bulgaria 735 1 547 160Poland 947 1 321 2 263Western Europe 1 028 1 177 1 986Holding company 7 3 84Other countries 229 275 141

Total 4 064 4 565 4 847


2.7 Governance and remune-ration

2.7.1 Board of Directors and Managing Direc-tors

At the date of the current report, members of the Board of Directors are as follows:

board of direCtorS CompoSition (1/2)

Function Appointment or last renewal

End of mandate Other mandates within the Group

Other mandates outside the Group

Current mandates :CEO of Diana Holding

Member of the Board of Atlas Bottling CompanyMember of the Board of Seven Up

Chairman of the Board of Mr RenouvoChairman of the Board of EbertecChairman of the Board of Thalvin

Chairman of the Board of Domaines Ouled ThalebChairman of the Board of Celliers de Meknes

Chairman of the Board of Maassera Brahim ZniberChairman of the Board of Domaines Brahim Zniber

Chairman of the Board ofDécouvertes & LoisirsAdministrateur de Société Nouvelle de Volailles

Member of the Board of SES WarrenManager of Domaine NamirManager of Domaine Tala

Manager of Domaine de TriffaManager of Gharb WineryManager of Domaine Livia

Manager of Riad de la Clémentine

Co-Manager of K'OzibarManager of Biocompost Brahim ZniberManager of Peppinière Brahim Zniber

Manager of AkaragroManager of Celliers du GharbManager of Viticole du Sais

Co-Manager of Olivim

Jacques Bourbousson

Independant Director

Co-opted by the Board of Directors

on 11 February 2013, and decision ratified during the General

Meeting of Shareholders on

30 September 2013

General Meeting of Shareholders to be held to approve the financial statements for the year ending 31 December 2015

Member of the Audit Committee

Member of the Nominations and Remunerations

Committee

-

Current mandates:Member of the Board of Directors and Member of the

Investment Committee of Alstria REITMember of the Board of Directors and Chairman of the Audit

Committee of SIIC de ParisSenior Advisor of Westbrook Advisors

-


Appointed during the General Meeting of Shareholders on30 September 2013

Appointed Chairman on 16 September

2014

Chairman of the Board of Directors

Independant DirectorBenoit Hérault

Rita Maria ZniberDirector representing

Diana Holding

Appointed during the General Meeting of Shareholders on 16 September 2014


-


During the meeting of the Board of Directors on 28 July 2014, M. Krzystof Trylinski stated that he was submitting his resignation as a member and Chairman of the Board of Directors for personal reasons. In order to ensure an efficient transition period, M. Kr-zystof Trylinski agreed to hold its positions until the next General Meeting of Shareholders due on 16 September 2014. The Board of Directors had decided to appoint M. Benoît Hérault as Chair-man of the Board of Directors . He began its functions starting 16 September 2014.

During the Board of Directors held on 16 September 2014, Mrs. Rita Zniber was appointed member of the Board as a repre-sentative of Diana Holding, thus 1st shareholder of the company. M. Benoit Ghiot was appointed as an independent member.

The Board of Directors gathered on 24 October 2014, fol-lowing the recommendations of its Nominations and Remune-rations Committee, decided unanimously to co-opt M. Mehdi Bouchaara as a second member of the Board as a representative

of Diana Holding and to create a position of Standing Invitee (wi-thout right to vote) for M. Serge Heringer as a representative and expert of Diana Holding. M. Mehdi Bouchaara was also appointed member of the Audit Committee for which M. Benoit Ghiot was appointed Chairman replacing M. Benoît Hérault. M. Serge Herin-ger was also appointed Standing Invitee to the Audit Committee.

It is indicated that the ratification of the co-optation of M. Mehdi Bouchaara as member of the Board of Directors will be subject to approval of the shareholders during the next General Meeting.

Those appointments take into account the role of Diana Holding as 1st shareholder of the company and are made in the frame of long-term industrial, commercial and financial partnerships.

board of direCtorS CompoSition (2/2)




Current mandates:CEO and member of the Board of Directors of Hachette

Filipacchi (SA)CEO Lagardère Digital France (SAS)

CEO of Lagardère Global Advertising (SAS)CEO of Lagardère Publicité (SAS)CEO and member of the Board of La Place Média (SAS)

Co-manager of Hachette Filipacchi Associés (SNC)Co-manager of Lagardère Métropoles (SARL)

Standing Invitée of Lagardère Publicité and Member of the Board of Média Institute (Association)

CEO and member of the Board of la Fondation Elle Independant member of the Board of Voyageurs du MondeIndependant member of the Board of Fondation Air France

Current mandates:Member of the Board of Directors of Fleury Michon

Member of the Board of Directors of Vivarte

Other mandates held during the last 5 years:Director of BHV

CEO of Virgin France & InternationalCEO of Virgin Mega

Current mandates:CFO of D'Ieteren SA

Member of the Board of Directors and Chairman of the Audit Committee of Belron SA

Member of the Board of Directors of Volkswagen D'Ieteren Financial Services SA

Member of the Board of D'Ieteren Treasury SAMember of the Board of D'Ieteren Vehicle Glass SA

Member of the Board of D'Ieteren Trading BVMember of the Board of Dicobel SA

Current mandates:Development and Strategic Adisor for Diana Holding

Other mandates held during the last 5 years:Deputy Director of "Celliers de Meknès"

Benoit Ghiot Independant Director



Chairman of the Audit Committee

Constance Benqué Independant Director



Member of the Nominations and Remunerations

Committee

Member of the working group dedicated to "Strategic

Committee"

Christine Mondollot Independant Director



Chairman of the Nominations and

Remunerations Committee


Committee"

Mehdi Bouchaara Director representing Diana Holding

Co-opted by the Board of Directors

on 24 October 2014, decision to be ratified

during the next General Meeting of

Shareholders




Committee"


At the date of the current report, Directorship is as follows:

M. Jean-Noël Reynaud profil

Before joining the Group in 2014, Jean-Noël Reynaud was De-puty Director of Lactalis Europe. He has 15 years of experience as Director in particular in Eastern Europe (Coca Cola beverages Ukraine, Lorenz Bahlsen Snack world, Bols sp zoo). He is also ex-perienced in the wine and liquor markets thanks to several Inter-national Managerial positions such as for Remy Cointreau Group. In addition to French, Japanese, English and German, Jean Noël Reynaud speaks also Polish.

There is no family relationship between the persons men-tioned in this Section.

To the Company’s knowledge, no member of the Board of Di-rectors or the General Management has been the subject:

- of a conviction for fraud in the last five years at least;

- of a bankruptcy, sequestration or liquidation, as either a Di-rector or company representative in the last five years at least;

- of a conviction and/or official public penalty pronounced by the statutory or regulatory authorities in the last five years at least.

Furthermore, to the Company’s knowledge, no com-pany representative has been prevented by a court to act as a member of one of the administrative, management or supervisory bodies of a public company or from being in-volved in the management or conduct of business of a pu-blic company in the last five years at least.

2.7.2 Remuneration of the members of the Board of Directors and of the Directors

The remuneration granted to the Company’s Directors and its representatives is listed below and is presented in accordance with the principles of the AFEP/MEDEF cor-porate code of governance and current regulations.

Subject to what is stated in this section, no payment shall be made for departures, for whatever reason, of members of the Board of Directors, or Directors who represent the company.

Remuneration, options and shares allocated to each Director and company representative

It is reminded that the Nominations and Remunerations Committee, in accordance with its mandates, submitted se-

veral applications to the Board of Directors for the posi-tion of Chief Executive Officer.

On 27 March 2014, the Board of Directors chose, subject to the approval of its position by the chosen applicant, to:

- Dissociate the functions of the Chairman of the Board of Di-rectors from those of the Chief Executive Officer;

- Extend the term of the mandates of M. Krzysztof Trylinski as member and Chairman of the Board of Directors until the end of its mandate;

- to appoint M. Jean-Noël Reynaud as Chief Executive Officer of the company.

On 31 March 2014, the Board of Directors noted the approval of Jean-Noël Reynaud and confirmed its appointment as Chief Executive Officer. It is indicated that it was effective starting 5 May 2014.

Besides, during the meeting of the Board of Directors on 28 July 2014, M. Krzystof Trylinski stated that he was submitting his resignation as a member and Chairman of the Board of Directors for personal reasons. In order to ensure an efficient transition period, M. Krzystof Trylinski agreed to hold its positions until the next General Meeting of Shareholders due on 16 September 2014. The Board of Directors had decided to appoint M. Benoît Hérault as Chairman of the Board of Directors. He began its func-tions starting 16 September 2014.

direCtorShip




Jean Noel Reynaud CEO

Appointed during the Board of

Directors of 27 March 2014 - effective on 5

May 2014

Unknown period of time

Manager of Sobieski SARLPermanent Representative of

BelvédèreCEO of Marie Brizard &

Roger InternationalCEO of Cognac Gautier,

William Pitters and Moncigale

Current mandates: -

Other positions held during the last 5 years:CEO of Lorenz Bahlsen Snack World - Poland

CEO of Coca Cola Beverages in UkraineDirector of Lactalis Europe


m. reynaud remuneration

m. trylinSKi remuneration

m. reynaud detailled remuneration

m. trylinSKi detailled remuneration

Due Remuneration Paid Remuneration Due Remuneration Paid Remuneration

M. Krzystof Trylinski Chairman of the Board - CEO

Fixed remuneration 429 136 € 429 136 € 181 379 € 181 379 €Annual Variable Remuneration 0 € 0 € 0 € 0 €Pluriannual Variable Remuneration 0 € 0 € 0 € 0 €Extra-ordinary Remuneration 0 € 0 € 0 € 0 €Attendance Fees 0 € 0 € 0 € 0 €Benefits in Kind 0 € 0 € 0 € 0 €

Total 429 136 € 429 136 € 181 379 € 181 379 €

2013 2014

2013 2014

M. Krzystof Trylinski Chairman of the Board - CEO

429 136 € 181 379 €

Due Remuneration allocated during the financial year 429 136 € 181 379 €Pluriannual Variable Remuneration allocated during the financial year 0 € 0 €Value of options allocated during the financial year 0 € 0 €Value of free-shares allocated during the financial year 0 € 0 €

2013 2014

M. Jean Noel Reynaud Chief Executive Officer

- 424 222 €

Due Remuneration allocated during the financial year - 424 222 €Pluriannual Variable Remuneration allocated during the financial year - 0 €Value of options allocated during the financial year - 0 €Value of free-shares allocated during the financial year - 0 €


M. Jean Noel Reynaud Chief Executive Officer

Fixed remuneration - - 183 556 € 183 556 €Annual Variable Remuneration - - 240 666 € 0 €Pluriannual Variable Remuneration - - 0 € 0 €Extra-ordinary Remuneration - - 0 € 0 €Attendance Fees - - 0 € 0 €Benefits in Kind - - 0 € 0 €

Total - - 424 222 € 183 556 €

2013 2014


Current Directors

Director left in 2014

It will be proposed to the shareholders during the next Ge-neral Meeting to allocate attendance fees for a total amount of €465,000 to split between the members of the Board of Directors.

Conflicts of interest within the administrative bodies and the Directorship

To the Company’s knowledge, there is no conflict between the private interests of the members of the Company’s administrative bodies and the Company’s interests.

Shares owned by the members of the Board of Directors or Executive Directors

It is indicated thereafter a detail summary of the transactions of shares realized by Board members or the Executive Directors (or closely connected persons) during the financial year ending 31 December 2014, according to the information communicated to Belvédère:

- Number of shares transmitted: 0

- Number of shares acquired: 2,840,000 shares acquired by Diana Holding, to which Ms. Rita Maria Zniber and M. Mehdi Bou-chaara are close

- Number of shares subscribed : 0

- Number of shares swapped : 0

It is indicated that on 13 March 2015:

- M. Benoit Herault acquired 871 shares of the company;

- Ms. Constance Benque acquired 513 shares of the company;

- M. Benoit Ghiot acquired 1,000 shares of the company;

- CM Consulting, connected to Ms. Christine Mondollot, ac-quired 412 shares of the company.

At the date of the current report, the following members of the Board of Directors stated that they owned:

- M. Jacques Bourbousson : 2 shares of the company;

- M. Mehdi Bouchaara : 25 shares of the company;

- Mrs. Rita Maria Zniber : 1,300 shares of the company.

On 26 March 2015, Diana Holding, to which Ms. Rita Maria Zni-ber and M. Mehdi Bouchaara are close, declared to have acquired 1,560,000 shares meaning that it owned 16.6% of the capital or 16.5 % of the voting rights of the company.

Stock options allocated during the year to members of the Board of Directors or Executive Directors

Not applicable

Stock options exercised during the year by members of the Board of Directors or Executive Directors

Not applicable

attendanCe feeS and other remuneration reCeived by the memberS of the board of direCtorS

2013 2014

M. Benoit HéraultChairman of the Board of Directors

- 96 233 €

Attendance Fees - 96 233 €Other Remunerations - 0 €

Ms. Rita Maria ZniberMember of the Board of Directors

- 0 €

Attendance Fees - 0 €Other Remunerations - 0 €

M. Jacques BourboussonMember of the Board of Directors

20 000 € 75 000 €

Attendance Fees 20 000 € 70 000 €Other Remunerations - 5 000 €

Ms. Constance RenquéMember of the Board of Directors

0 € 56 250 €

Attendance Fees 0 € 56 250 €Other Remunerations 0 € 0 €

Ms. Christine MondollotMember of the Board of Directors

0 € 87 500 €


M. Mehdi BouchaaraMember of the Board of Directors

- 8 384 €

Attendance Fees - 8 384 €Other Remunerations - 0 €

2013 2014

M. Pascal BazinMember of the Board of Directors

0 € 70 000 €



Performance shares allocated to members of the Board of Di-rectors or Executive Directors

Not applicable

Stock options granted to and exercised by the ten highest non-Director employee beneficiaries

Not applicable

It is indicated that the Board of Directors decided on 12 March 2015 to allocate 9,320 free shares and 480,000 stock purchase or stock subscribe options to some employees and Managers of the Group.

This decision was authorized by the General Meeting of shareholders gathered on 16 September 2014. It will enable to align the interests of the recipient and those of the Group’s shareholders.

Allocation of free shares

The Board of Directors has thus decided to allocate 20 free shares to each employee of Belvédère SA and its French subsidiaries, i.e. a total of 9,320 free shares. These free shares will be definitively acquired following a 2-year period from the date of their allocation, the only condi-tion being that the member of staff should still be with the Company at that time – there are no specific perfor-mance-related conditions. These shares will be non-trans-ferable for a period of 5 years from the date of acquisition.

Allocation of options subject to performance conditions

The 480,000 subscription or purchase options (the Op-tions) are to be allocated to 26 Belvédère group managers, including CEO Jean-Noël Reynaud, who will be allocated 110,000 Options.

Each of these Options will give the holder the right to subscribe or to purchase 1 Belvédère SA share at a unit price of €10.64, calculated on the basis of Belvédère’s average opening price over the 20 trading sessions preceding the date of the Board of Directors’ meeting.

The Options thus allocated may only be exercised in stages and in accordance with performance conditions being achieved under the following conditions:

- A maximum of 20% of the allocated Options may be exer-cised in 2015, subject to a specific consolidated operating profit from continuing operations being recorded based on the Group’s consolidated accounts for the financial year to 31 December 2014, although a certain number of these Options may neverthe-less be exercised if this objective were partially achieved;

- A maximum of 20% of the allocated Options may be exer-cised in 2016, subject to a specific consolidated ratio (EBITDA/Sales) being recorded based on the Group’s consolidated ac-counts for the financial year to 31 December 2015, although a certain number of these Options may nevertheless be exercised if this objective were partially achieved; and

- A maximum of 60% of the allocated Options may be exer-cised in 2018, subject to a specific consolidated ratio (EBITDA/Sales) being recorded based on the Group’s consolidated ac-counts for the financial year to 31 December 2017, although a certain number of these Options may nevertheless be exercised if this objective were partially achieved.

The Board of Directors will confirm whether these perfor-mance conditions have been met, bearing in mind that the allo-cation plan also requires the holders of these Options to still be with the Group when these Options are exercised.

As well as the requirement to retain 50% of their shares for a 2-year period from the corresponding exercise dates of these Options laid out by the Board of Directors, with which all Option beneficiaries must comply, Mr Jean-Noël Reynaud will have to re-tain, as registered shares, at least 20% of the shares resulting from the exercising of his Options until he leaves his position as CEO, in accordance with article L.225-185 paragraph 4 of the French Commercial Code.

information on optionS SubjeCt to performanCe ConditionS alloCated to m. reynaud (marCh 2015)

Plan # and Date Nature

Value of the options in the

financial statements

Number of options allocated

Exercise price Exercice period

Jean Noel Reynaud Chief Executive Director

#112 March 2015 Subscription Na *

110,000 options giving right to 110,000 shares

€10.64

20 % in 2015 according to 2014

results


results


results

* : This plan was set up in March 2015 and its valuation is not yet taken into account in the financial statements for 2014


Within the global limit decided by the General meeting of shareholders and after consultation of its Nominations and Re-munerations Committee, the Board of Directors allocate atten-dance fees to the members of the Board and may allocate to members of special Committees an additional amount of atten-dance fees taking into account the time given by the members to

those Committees.

The General meeting of shareholders that met on 16 Sep-tember 2014 set out the amount of attendance fees at €445,000.This amount must be shared between the members of the Board of Directors for the current year.

Summary of the alloCationS of optionS

General Meeting of Shareholders16 septembre 2014

Board of Directors

Number of shares that could be subscribed

Members of the Board or Directors

M. Jean Noel Reynaud

Starting point of the Options

Expiry Date

Subscription Price

Exercising features

Number of shares subscribed as of the date of the report

Cumulated number of Options cancelled or obsolete

Number of options outstanding as of the date of the report

12 March 2020

10,64 €

1 option for 1 share

Nil

Nil

480 000

Plan #1 Plan #2

12 March 2015

480 000

110 000

20 % starting 2015, according to 2014 results



exeCutive direCtorS: SoCial StatuS

amountS eStabliShed or proviSioned by the Company (penSionS, retirement CommitmentS or other)

In € 000 31-Dec-12 31-Dec-13 31-Dec-14

Expenses linked to post employment benefits 63 0 0Expenses linked to post termination benefits na na na

D e t a i l e d i n f o r m a -tion corresponding to benefits granted to Exe-cutives Directors figure in paragraph 5.3 of this document relat ing to regulated agreements involving these two Di-rectors.

Employment Contract

Additional pension scheme

Remuneration, compensation or benefit items due or likely to be

due as a result of taking up, resigning or changing duties

Compensation relating to a non-competition clause

Date of end of functions within

the Company

-

16 September 2014

Jean Noel ReynaudDirector No No

No, except for legally required severance payments No

Krzysztof TrylinskiCEO No No

Yes, please refer to notes to the financial statements No


On 24 October 2014, the Board of Directors decided to allo-cate the attendance fees as follows:

- €100,000 to the Chairman of the Board- €45,000 to the other members of the Board- 25,000 to each Chairman of Special Committees

For 2014, the amount of attendance fees that were not as-signed was of €25,000.

2.7.3 Functioning of management and su-pervisory bodies

Information concerning the service contracts binding the members of the Board of Directors to the issuer or to any of its subsidiaries and providing benefits

There are no other contracts binding the member of the Board of Directors or the Executive Directors to the Com-pany or its subsidiaries than those detailed in the special report of Statutory Auditors about regulated agreements and commitments.

Committees

Since 2013 and particularly since the appointment of independent Directors, the Board of Directors has intro-duced several specialized committees. The Company thus initiated procedures with a view to improve compliance with best practices in matters of corporate governance.

- The Company’s Board of Directors, at its meeting on 11 Fe-bruary 2013, decided to create an ad hoc committee known as the “Governance Committee”, whose members were Krzysztof Trylinski, Chairman and CEO, Frédéric Abitbol (the Company’s court-appointed administrator) and Jacques Bourbousson, co-opted as a Director on 11 February 2013.

- The Governance Committee’s remit was to (i) review and propose potential future independent Directors for the Board of Directors, (ii) prepare the composition of an audit committee as well as a remunerations committee, and (iii) propose draft in-house rules for the Board of Directors, the audit committees and the remunerations committee. After the completion of its objec-tives, this Committee was dissolved.

- On 30 September 2013, the Company’s Board of Directors decided to introduce a Nomination Committee in order to iden-tify candidates for Company Chairman and/or Managing Director.

- On 10 October 2014, the Nominations Committee was merged with the Remunerations Committees created on 30 Oc-tober 2013 in order to have a unique Committee named: Nomi-nations and Remunerations Committee.

At the date of the current report, this latter is composed of Mrs. Christine Mondollot, Mrs. Constance Benque and M. Jacques Bourbousson, Mrs. Mondollot being Chairman of this Committee.

- The Company’s Board of Directors meeting of 11 October 2013 decided to introduce an Audit Committee. The Audit Com-mittee is composed of M. Jacques Bourbousson, M. Mehdi Bou-chaara and M. Benoît Ghiot, who was also appointed as Chairman of the said committee. Serge Heringer is also standing invitee to the Audit Committee.

- On 25 June 2014 and 24 October 2014, the Board of Direc-tors decided to constitute a working group called “Strategic Committee” that is composed of Mrs. Christine Mondollot (also Chairman of this Committee) and Mrs. Constance Benque and M. Mehdi Bouchaara. Mr. Serge Heringer is also standing invitee to this working group.

Corporate governance

Chairman’s report relating to corporate governance and internal controls is available in the Annual Financial Re-port.

2.8 Workforce

2.8.1 Workforce Evolution

The table hereafter summarizes the workforce evolution during the last 3 years:

worKforCe evolution during the laSt 3 yearS

2012 2013 2014

Employees 3 142 2 975 2 493


The table hereafter details the workforce breakdown as at 31 December 2014:

2.8.2 Share capital owned by employees

Historically, the company has no knowledge of an im-portant ownership of Belvédère shares by the employees.

In order to motivate employees and managers, especially in the frame of the strategic plan “BiG 2018”, the General Meeting of Shareholders approved on 16 September 2014 3 motions:

- Delegation of Authority to the Board of Directors of the com-pany in order to proceed to the allocation of Options (stock pur-

chase or stock subscribe) to the benefit of employees, managers and Directors of the Group and the companies of the Group ;

- Delegation of Authority to the Board of Directors of the com-pany in order to proceed to the allocation of free shares to the benefit of employees, managers and Directors of the Group and the companies of the Group ;

- Delegation of Authority to the Board of Directors of the com-pany in order to proceed to one or several capital increase(s) in cash exclusive to employees participations in a company savings plan, in conformity with articles L.225-129-6, alinéa 1 of the Com-mercial Code and of L.3332-1 of “Code du travail”, without prefe-rential subscription rights for existing shareholders

On the basis of those authorizations, the Board of Directors decided on 12 March 2015 the allocation of 9,320 free shares and 480,000 stock purchase or subscription options to some employees and Directors of the Group. It will enable to align the interests of the recipient and those of the Group’s shareholders.

Allocation of free shares

The Board of Directors has thus decided to allocate 20 free shares to each employee of BELVEDERE SA and its French subsidiaries, i.e. a total of 9,320 free shares. These free shares will be definitively acquired following a 2-year period from the date of their allocation, the only condi-tion being that the member of staff should still be with the Company at that time – there are no specific perfor-mance-related conditions. These shares will be non-trans-ferable for a period of 5 years from the date of acquisition.

Allocation of options subject to performance conditions

The 480,000 subscription or purchase options (the Op-tions) are to be allocated to 26 Belvédère group managers, including CEO Jean-Noël Reynaud, who will be allocated 110,000 Options.

Each of these Options will give the holder the right to subscribe or to purchase 1 Belvédère SA share at a unit price of €10.64, calculated on the basis of Belvédère’s average opening price over the 20 trading sessions preceding the date of the Board of Directors meeting.

Those two allocations (free shares and options) represent a potential of 1.8% of the capital for the employees and the mana-gers (according to the total number of shares as at 31 December 2014).

Managers Employees Total

Belvédère SA 19 19Sobieski SARL 1 2 3Holdings 20 2 22

William Pitters 15 36 51Cognac Gautier 5 30 35Marie Brizard 83 107 190Moncigale 20 157 177France 123 330 453

MB Espagne 33 42 75Spain 33 42 75

Sobieski SP zoo 38 192 230Destylernia Sobieski 20 230 250Polmos Lancut 15 149 164Domain Menada Sp z.o.o. 19 42 61Sobieski Trade 74 475 549Galerie Alkoholi Sp. z o.o. 59 94 153Augustowianka 5 29 34Destylernia Polmos Krakow 8 17 25Poland 238 1 228 1 466

Belvedere Baltik 2 2Belvedere Prekyba 64 18 82Dunkeris LT 2 2Vilniaus degtine 67 92 159Lithuania 135 110 245

Belvedere Distribution SIA 1 5 6Latvia 1 5 6

Vinimpex 4 1 5Menada Vineyards 1 22 23Belvedere Distribution 14 22 36Domain Menada 14 68 82Belvedere Capital Management 1 1 2Belvedere Bulgaria 1 1 2Bulgaria 35 115 150

Imperial Brands 15 19 34United-States of America 15 19 34

Dubar (GM Brazil, BVD SA, included) 1 19 20Brasil 1 19 20

Belvedere Scandinavia 3 5 8Denmark 3 5 8

Sobieski Trading Shanghai Co. 2 2China 0 2 2

Sobieski Beverages India 9 2 11India 9 2 11

Sobieski Ukraina 1 1Ukraina 1 0 1

2 493

Workforce breakdown as at 31 December 2014

TOTAL


2.9 Share capital and shareholding structure

2.9.1 Information about share capital

Following the recognition by the Board of Directors on 28 April 2015 of a capital raising through the exercise of equity instruments giving access to the capital (described hereafter), the share capital of the company amounted to €52,973,242, divided into 26,486,621 shares with a nominal value of €2.00. Shares are divided into two categories: ordi-nary shares and “Shares with Special Voting Rights”.

“Shares with Special Voting Rights”, which were created during the General Meeting of Shareholders gathered on 28 February 2013, are registered in a managed registration account or in an issuer registration account. “Shares with Special Voting Rights” have the same rights as ordinary shares but are deprived of vo-ting rights for resolutions taken in ordinary general meetings relating to the appointment, reappointment or dismissal of members of the Company’s Board of Directors, or any resolution ratifying the Board of Directors’ coopting of a Director.

“Shares with Special Voting Rights” may be converted into or-dinary shares exclusively in the cases defined within the Article of Association. As at 31 December 2014, 3,071 “Shares with Special Voting Rights” were outstanding.

The Board of Directors recorded a capital increase of €310 on 28 April 2015 following:

- The exercise of 238 warrants (BSA) issued to historical shareholders for 89 shares

- The exercise of 178 warrants (BSA) issued to historical shareholders for 66 shares

From which 16 shares had already been issued during 2014, i.e. a net issue of 139 shares since 1 January 2015.

Since 31 December 2012, the number of shares outstanding is as presented in the table bellow.

Changes in the share capital during the last 3 years

The change in share capital during 2014 is a result of the following:

- the exercise of 679 warrants (BSA) issued to historical shareholders for 259 shares,

- the exercise of 30 warrants (BSA) issued to historical shareholders for 10 shares.

The change in share capital during 2013 is a result of the fol-

lowing:- exercise of 37,125 BSA 2006 for 37,180 shares,- exercise of 4,109 BSA A1 for 1,559 shares,- exercise of 2,681 A2 for 1,017 shares,- exercise of 184,347 AOBSA for 5,594 shares,- conversion of FRN bonds into shares representing an issue

of 18,216,154 ordinary shares and 4,819,030 special voting right shares (totaling 23,035,184 shares),

representing a total of 23,080,534 new shares issued during 2013.

All of the increases in share capital in the Company recorded since 2009 were mainly due to the exercise of BSA 2004 and BSAR 2006 warrants giving access to the Company’s share capital.

Delegation of authority

At the date of the current report, the following table summarizes the delegation of authority voted during the General Meeting of Shareholders on 16 September 2014:

On the basis of those authorizations, the Board of Directors decided on 12 March 2015 the allocation of 9,320 free shares and 480,000 stock purchase or subscription options to some em-ployees and Directors of the Group. These allocations reduce the amount defined during the General Meeting of 16 September 2014 (use of the delegation to the amount of around 1.8% of the

number of ShareS outStanding evolution

delegation of authority

31 December 2012 31 December 2013 31 December 2014 As at the date of the Report

Number of shares outstanding 3 405 679 26 486 213 26 486 482 26 486 621

Date Delegation of Authority in order to decide… Maximal amount authorised (nominal value)

Length of the delegation

Pricing method

16-sept-14...the allocation of Options (stock purchase or stocksubscribe) to the benefit of employees, managers andDirectors of the Group and the companies of the

2 % maximum of the share capital

38 months Exercising price is at minimum equal to the average price over 20 trading sessions

16-sept-14... the allocation of free shares to the benefit ofemployees, managers and Directors of the Group andthe companies of the Group

2 % maximum of the share capital

38 months na


share capital of the company for a maximal amount authorized of 2.0%).

Shares not representing capital

Nil.

2.9.2 Shareholding structure

To the Company’s knowledge, and based on declara-tions received by the Company, as at 31 December 2014, no shareholder, whether an individual or a corporate entity, had informed the Company of an equity interest exceeding 5 % excluding Diana Holding, KKR and SPC LUX.

aS at 31 déCembre 2014



Shareholders Number of shares % Capital Number of Voting rights

% of Voting rights

Free Float 2 817 501 82,7% 2 818 979 86,0%

Angostura Holding Ltd (1) 148 200 4,4% 296 400 9,1%

Bruce Willis 83 000 2,4% 83 000 2,5%

Treasury shares(2) 281 285 8,3% - -

Board members and Executive Officers(3)

75 693 2,2% 78 401 2,4%

TOTAL 3 405 679 100,0% 3 276 780 100,0%

(2) : These shares had no voting rights(3) : On the basis of information communicated to the Company

(1) : To the Company’s knowledge, Angostura Holdings Limited is controlled at its highest level by CL Financial Limited, a company incorporated in the Republic of Trinidad and Tobago


% of Voting rights

Free Float (1) 24 684 583 93,2% 24 840 422 93,2%

SPC Lux (2) 1 798 193 6,8% 1 798 193 6,8%

Treasury shares (3) 3 437 0,0% - -

TOTAL 26 486 213 100,0% 26 638 615 100,0%

(3) : These shares are deprived of voting rights

(1) : At the date of publication, no shareholder, whether an individual or a corporate entity, had informed the Company of an equity interest exceeding 5 %.(2) : Threshold exceeded - declared by letter dated 13 December 2013 and published by the AMF on 13 December 2013


% of Voting rights

Public (1) 18 929 904 71,5% 19 172 439 71,7%

Diana Holding (2) 3 480 000 13,1% 3 480 000 13,0%

KKR (3) 2 271 262 8,6% 2 271 262 8,5%

SPC Lux (4) 1 798 193 6,8% 1 798 193 6,7%

Treasury shares (5) 7 123 0,0% - -

TOTAL 26 486 482 100,0% 26 721 894 100,0%

(5) : These shares are deprived of voting rights

(1) : At 31 December 2014, no shareholder, whether an individual or a corporate entity, had informed the Company of an equity interest exceeding 5 %.(2) : Threshold exceeded - declared by letter dated 3 October 2014 and published by the AMF on 3 October 2014(3) : Threshold exceeded - declared by letter dated 1 April 2014 and published by the AMF on 2 April 2014(4) : Threshold exceeded - declared by letter dated 13 December 2013 and published by the AMF on 13 December 2013


Voting rights

Article 27 of the Company’s Articles of Association pro-vides that any holder of fully paid up shares able to prove that his/her shares have been registered in his/her name for at least four years shall have the double voting rights provided for by law.

“Any owner of shares that are paid up in full, who can prove re-gistration in his/her name for the previous four (4) years at least, may have twice the voting rights as provided for in law. Further-more, should there be an increase in the capital through the capi-talization of reserves, profits or additional paid-in capital, double the voting rights shall be granted, as soon as they are issued, to bonus registered shares allocated to a shareholder as new shares, for which he/she benefits from such a right.

Any share converted into a bearer share or whose ownership is transferred shall lose the right to a double vote.”

Besides, it is reminded that the share capital of the company is divided into two categories: ordinary shares and “Shares with Special Voting Rights”. Article 11 provides details regarding those laters:

« Shares with Voting Rights have the same rights as ordinary shares but are deprived of voting rights for resolutions taken in ordinary general meetings relating to the appointment, reap-pointment or dismissal of members of the Company’s Board of Directors, or any resolution ratifying the Board of Directors’ coop-ting of a Director. »

Agreements liable to result in a change of control

As at the date of the Registration Document, there was no agreement liable to result in a change of control.

Shareholding thresholds in 2014

S H A R E H O L D I N G T H R E S H O L D D I S C LO S U R E A N D D E C L A R AT I O N O F I N T E N T BY D I A N A H O L D I N G ( 3 O C TO B E R 2014 ) :

- By mail received on 3 October 2014, the limited lia-bility company governed by Moroccan Law “Diana Hol-ding” 1 (“Domaine Zniber, Ait Harzallah, Province d’El Hajeb, Wilaya de Meknes Tafilalet, Maroc”) declared that, on 29 September 2014, it went above the threshold of 10% of the capital and of the voting rights of the company Bel-védère and that it owned 2,840,000 shares of Belvédère (same amount of voting rights) representing 10.72% of the capital and 10.63% of the voting rights 2.

- This threshold crossing is a result of the acquisition of shares on the market.

Diana Holding stated that it owned as 1 October 2014, 3,480,000 Belvédère shares representing the same amount

of voting rights i.e. 13.14% of the capital and 13.02% of the voting rights.

- In the same mail, the following declaration of intent was rea-lized:

« In accordance with articles L. 233-7 of the Commercial Code and 223-17 of the general regulations of the AMF, “Diana Hol-ding” states for the next 6 months:

- That the acquisitions ending in the threshold crossing above described were financed through a long term bank loan backed by equity and assets of the Group Diana Holding

- That it is not acting in concert with a third party through the company Belvédère,

- That it does not exclude to pursue acquisitions of Belvédère shares, according to market conditions, in order to comfort its po-sition as reference shareholder with more than 13% of the capital at the date of the announcement

- That it does not exclude to take control of Belvédère accor-ding to Article L.233-3 of the “Code du Commerce” because it may effectively – in the long term - be in the situation of deter-mine “actually, through the voting rights which it owned, the de-cisions in the General Meetings of that company” but that it does not forecast to cross a threshold in capital or in voting rights that would mandate it to take over the company

- That it confirms as a professional player of the wine market that it wants to set up industrial and commercial partnerships with the company Belvédère, in order to develop the potential synergies implying that a sufficient representation to the Board of Directors is settled.

- According to this, outside the nomination of Rita Maria Zni-ber as a member of the Board of Directors (decided with 94.5% of voting rights during the General Meeting of Shareholders that took place on 16 September 2014) it asks to the Board of Direc-tors of Belvédère to co-opt the second member that was pro-posed on 16 September 2014 and a third member whose identity will be given shortly.

Besides, Diana Holding stated:

- That it has no intention to set up an operation referred to in Article 223-17 I, 6° of the general regulations of the AMF;

- That is does not belong to agreements or instruments men-tioned in 4° et 4° bis of I of Article L. 233-9 of the Commercial Code;

- That it has not concluded any agreement regarding the re-verse transactions of Belvédère shares or voting rights.

1: Controlled by Zniber Family.2 : Based on a share capital composed of 26,486,477 outstanding

shares representing 26,721,879 voting rights according to alinéa 2 of Ar-


ticle 223-11 of the AMF rules.

S H A R E H O L D I N G T H R E S H O L D D I S C LO S U R E BY D I A N A H O L D I N G ( 8 S E P T E M B E R 2014 ) :

- By mail received on 5 September 2014, the limited lia-bility company governed by Moroccan Law “Diana Hol-ding” 1 (“Domaine Zniber, Ait Harzallah, Province d’El Hajeb, Wilaya de Meknes Tafilalet, Maroc”) declared that it went above the threshold of:

- 5% of the capital and of the voting rights of the company Belvédère and that it owned 1,329,067 shares of Belvédère (same amount of voting rights) representing 5.02% of the capital and 4.97% of the voting rights 2 on 3 September 2014.

- 5% of the capital and of the voting rights of the company Belvédère and that it owned 1,543,000 shares of Belvédère (same amount of voting rights) representing 5.83% of the capital and 5.77% of the voting rights 2 on 4 September 2014.

- These threshold crossings are the result of the acquisitions of shares on the market.

1: Controlled by Zniber Family.2: Based on a share capital composed of 26,486,477 outstanding

shares representing 26,721,879 voting rights according to alinéa 2 of Ar-ticle 223-11 of the AMF rules.

S H A R E H O L D I N G T H R E S H O L D D I S C LO S U R E BY K K R ( 2 A P R I L 2014 ) :

- By mail received on 1 April 2014, the company“ KKR & Co. L.P. (c/o Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801, New Castle County, USA) declared that, on 31 March 2014, through the com-panies of its group, it went above the threshold of 5% of the capital and of the voting rights of the company Belvé-dère and that it owned 2,271,262 shares of Belvédère (same amount of voting rights) representing 8.58% of the capital and 8.50% of the voting rights 1.

This threshold crossing is a result of the sum of equity parti-

cipations managed by the companies Echo Holdings L.P. (Echo Investments I Ltd 2) and Avoca Capital Holdings 3 (both controlled by KKR & Co. L.P.), which were previously not aggregated due to dispositions of Article L.233-9 of the Commercial Code.

1: Based on a share capital composed of 26,486,186 outstanding shares representing 26,721,598 voting rights according to alinéa 2 of Article 223-11 of the AMF rules.

2: Controlled by Echo Holdings L.P., itself controlled by funds managed by KKR Asset Management LLC (acting as General Partner and Investment Manager), which is controlled at the highest level by KKR & Co. L.P.

3: Avoca Credit Opportunities Fund, Absalon Credit Fund Ltd and Avoca Value Fund are funds managed by Avoca Capital Holdings (acting as General Partner and Investment Manager), which is controlled at the highest level by KKR & Co. L.P.

Shareholding thresholds since 1 January 2015

S H A R E H O L D I N G T H R E S H O L D D I S C LO S U R E A N D D E C L A R AT I O N O F I N T E N T BY D I A N A H O L D I N G ( 1 A P R I L 2015 ) :

- By mail received on 1 April 2015, the limited liability company governed by Moroccan Law “Diana Holding” 1

(“Domaine Zniber, Ait Harzallah, Province d’El Hajeb, Wilaya de Meknes Tafilalet, Maroc”) declared that, on 26 March 2015, it went above the threshold of 15% of the ca-pital and of the voting rights of the company Belvédère and that it owned 4.400.000 shares of Belvédère (same amount of voting rights) representing 16.61% of the capital and 16.47% of the voting rights 2.

- This threshold crossing is a result of the acquisition of shares on the market.

- Regarding Article 223-14 III and IV of the general regulations of the AMF, “Diana Holding” stated that it owned:

- 100.000 warrants (BSA) to be exercised before 23 April 2018 and giving access to around 0.38 Belvédère shares when exerci-sing 3 warrants minimum to the price of €23.82 per share.

- 3.000.000 warrants (BSA), to be exercised before 31 De-cember 2016 and giving access to around 0.03 Belvédère shares 3 to the price of €20.01 per share.

- In the same mail, the following declaration of intent was rea-lized:

« In accordance with articles L. 233-7 of the Commercial Code and 223-17 of the general regulations of the AMF, “Diana Hol-ding” states for the next 6 months:

- That the acquisitions ending in the threshold crossing above

information diSCloSed by KKr (april 2014)

Shareholders Number of shares % of shares Number of Voting rights

% of Voting rights

Echo Investments I Ltd (2) 1 198 794 4,53% 1 198 794 4,49%

Avoca Credit Opportunities Fund (3) 583 885 2,20% 583 885 2,19%

Absalon Credit Fund Ltd (3) 399 604 1,51% 399 604 1,50%

Avoca Value Fund (3) 88 979 0,34% 88 979 0,33%

TOTAL 2 271 262 8,58% 2 271 262 8,50%


described were financed through a long term bank loan backed by equity and assets of the Group Diana Holding;

- That is not acting in concert with a third party through the company Belvédère;

- That it does not exclude to pursue acquisitions of Belvédère shares, according to market conditions,

- That it does not exclude to take control of Belvédère accor-ding to Article L.233-3 of the “Code du Commerce” because it may effectively – in the long term - be in the situation of deter-mine “actually, through the voting rights which it owned, the de-cisions in the General Meetings of that company” but that it does not forecast to cross a threshold in capital or in voting rights that would mandate it to take over the company;

- That it confirm as a professional player of the wine market that it wants to set up industrial and commercial partnerships with the company Belvédère, in order to develop the potential synergies implying that a sufficient representation to the Board of Directors is settled.

- According to this, outside the nomination of Rita Maria Zni-ber as a member of the Board of Directors (decided during the General Meeting of Shareholders that took place in 16 September 2014) and the co-option of Mehdi Bouchaara as a member of the Board of Directors (decided during the Board of Directors that took place in 24 October 2014), it asks to the Board of Directors of Belvédère to co-opt Serge Heringer as soon as possible, whose application was submitted in October 2014. Given that Serge He-ringer has a status of standing invitee to the Board of Directors and to the Audit Committee does not give him the possibility to participate in decisions.

Besides, Diana Holding stated:


- That is does not belong to agreements or instruments men-tioned in 4° et 4° bis of I of Article L. 233-9 of the Commercial Code

- That it has not concluded any agreement regarding the re-verse transactions of Belvédère shares or voting rights.

1: Controlled by Zniber Family.2: Based on a share capital composed of 26,486,477 outstanding

shares representing 26,721,879 voting rights according to alinéa 2 of Ar-ticle 223-11 of the AMF rules.

3: It is indicated that the number of share would be rounded to the nearest whole number and a compensation would be given in cash

S H A R E H O L D I N G T H R E S H O L D D I S C LO S U R E BY D F H O L D I N G ( 13 M AY 2015 ) :

- By mail received on 13 May 2015, completed by a mail received on 15 May 2015, the limited liability company go-verned by Luxembourg Law “DF Holding” 1 (34-38 ave-nue de la Liberté, L-1930 Luxembourg, Grand Duché du Luxembourg) declared that, on 13 May 2015, it went above the threshold of 5% of the capital and of the voting rights

of the company Belvédère and that it owned 1,500,000 shares of Belvédère (same amount of voting rights) re-presenting 5.66% of the capital and 5.61% of the voting rights 2.

1: Controlled by Castel family2: Based on a capital composed of 26,486,621 shares and 26,748,958

voting rights according to alinéa 2 of Article 223-11 of the AMF rules.

Pacts, shareholders’ agreements and concerted actions agreements

Nil.

Items likely to have an impact in the event of a public offer

In conformity with Article L.225-100-3 of the Commer-cial Code, Items likely to have an impact in the event of a public offer are detailed hereafter.

Capital structure of the Company

The Articles of Association of the company do not provi-de voting-caps restrictions.

It is reminded that the share capital of the company is divi-ded into two categories: ordinary shares and “Shares with Special Voting Rights”. Article 11 provides details regarding those laters:

« Shares with Voting Rights have the same rights as ordinary shares but are deprived of voting rights for resolutions taken in ordinary general meetings relating to the appointment, reap-pointment or dismissal of members of the Company’s Board of Directors, or any resolution ratifying the Board of Directors’ coop-ting of a Director. »

Article 11 states that the “Shares with Special Voting Rights” may be converted into ordinary share in the cases specified by that Article.

Besides, Article 27 of the Company’s Articles of Association provides double voting rights

- For any holder of fully paid up shares able to prove that his/her shares have been registered in his/her name for at least four years shall have the double voting rights provided for by law.

- Furthermore, should there be an increase in the capital through the capitalization of reserves, profits or additional paid-in capital, double the voting rights shall be granted, as soon as they are issued, to bonus registered shares allocated to a shareholder as new shares, for which he/she benefits from such a right.

Any share converted into a bearer share or whose ownership is transferred shall lose the right to a double vote.”

Moreover, any individual or corporate entity that comes into possession, directly or indirectly, alone or jointly, of at least 2.5% of the issued share capital or voting rights in the Company, or any multiple of this percentage, shall inform the Company ac-cordingly within 15 days, by registered letter with acknowledge-


ment of receipt, addressed to the registered office.

If the shares or voting rights exceed the proportion that should have been disclosed under the abovementioned condi-tions, they shall be deprived of voting rights under the conditions laid down in law.

The abovementioned disclosure requirements shall also apply each time an individual’s or corporate entity’s share of the capital or voting rights falls below the 2.5% threshold or any multiple thereof.

Direct or indirect participating interests in the capital of the Company

The structure of ownership is detailed in previous para-graph.

Owners of any securities conferring special rights of control and description of those rights

Nil.

Control procedure provided in the event of potential employee shareholdings with control rights not exercised by the latter

Nil.

Agreements between shareholders of which the Company is aware and which may give rise to restrictions on share transfers and voting rights

The company has no knowledge of agreements between shareholders which may give rise to restrictions on share transfers and voting rights.

Rules governing the appointment and replace-ment of Board members and the amendment of the Articles of association

In conformity with Article 13 of the Articles of Asso-ciation of the Company, the members of the Board of Di-rectors shall be appointed or have their terms of office re-newed by the Ordinary General Meeting of shareholders. Their terms of office shall last for six years. The duties of a Director shall end at the close of the Ordinary General Meeting called to approve the financial statements for the previous financial year, held during the year in which the said Director’s term of office expires. Directors may always be re-elected. They may be dismissed at any time by the Ordinary General Meeting.

In conformity with Article L. 225-96 al. 1 of the Commercial Code, the Articles of Association of the Company can only be modified by an Extraordinary General Meeting. Nevertheless it is reminded that:

- As stated in Article 4 of the Articles of Association, the Board of Directors is authorized to modify the headquarter of the com-pany within the same area or an adjacent area subject to ratifica-

tion by the next Annual General Meeting

- The General Meeting may delegate powers to the Board of Directors through annual delegations.

Authority of the Board of Directors in the event of a public offer

O n 1 6 S e p te m b e r 2 0 1 4 , t h e G e n e ra l M e e t i n g o f Shareholders authorized (resolution #11) the Board of Di-rectors to make acquire by the Company its own shares. The acquisition, sale or transfer of those shares may be done, also in case of public offer, through every means, comprising the acquisition of blocks of shares, in one or more operations, within the limits offered by the stock market rules.

Agreements entered into by the Company that would change or terminate if there were a change of control of the Company

The Company and/or its subsidiaries have signed agree-ments including change-of-control clauses that enable the contractor the possibility to terminate the contract in case of change of control of the Company.

Agreements providing compensation for members of the Board of Directors or Executive Directors in the event of resignation or dismis-sal without genuine and serious cause, or if their employment is terminated by reason of a public tender offer

There is no commitment taken by the company that cor-responds to compensation or benefit items due or likely to be due as a result of termination or change in their man-dates active at the date of the current report between the Company and the members of the Board of Directors or Executive Directors, and that is likely to have an impact in the event of a public tender offer.

2.9.3 Potential Capital

Dilution Instruments as at 31 December 2014

As 31 December 2014, the instruments that could give access to the capital are the followings:

- 585,262 BSA 2004 warrants (transaction memorandum as ap-proved by the AMF by visa no. 04-884 dated 10 November 2004, see Section 2.1 of the Registration Document);

- 93,010 BSAR 2006 warrants (transaction memorandum as approved by the AMF by visa no. 06-068 dated 9 March 2006, see Section 2.1 of the Registration Document).

- 6,849,705 BSA warrants issued to historical shareholders (transaction memorandum as approved by the AMF by visa no. 13-162 dated 16 April 2013);


- 93,161,762 BSA OS warrants (transaction memorandum as approved by the AMF by visa no. 13-162 dated 16 April 2013, completed by an additional memorandum as approved by the AMF by visa no. 13-665 dated 11 December 2013).

The terms of the BSA 2004 and BSAR 2006 warrants provided for in the aforementioned transaction memoranda were changed at the Special General Meetings held on 27 September 2013. The implementation of the said changes was authorized by the Ex-traordinary General Meeting of the Company held on 30 Sep-tember 2013.

- Since the Extraordinary General Meeting of the Company held on 30 September 2013 that changed certain terms of the BSA 2004 issued in the frame of the transaction memorandum as approved by the AMF by visa no. 04-884 dated 10 November 2004, the exercise price of BSA 2004 is set out at €26.20 and will not change until the end of the exercise period. That period ex-piry on 24 April 2018. Since a decision of the Board of Directors on 16 May 2013, the parity is set out at 1 BSA 2004 for 1.1 Belvé-dère share.

- Since the Extraordinary General Meeting of the Company held on 30 September 2013 that changed certain terms of the BSA 2006 issued in the frame of the transaction memorandum as approved by the AMF by visa no. 06-068 dated 9 March 2006, the exercise price of BSA 2006 is set out at €25.49 and will not change until the end of the exercise period. That period expiry on 24 April 2018. Since a decision of the Board of Directors on 16 May 2013, the parity is set out at 1 BSA 2006 for 1.07 Belvédère share.

The updated features of the instruments giving access to capi-tal as at 31 December 2014 are detailed thereafter:

Other dilutive instruments issued since 31 De-cembre 2014

It is reminded that the Board of Directors gathered on 12 March 2015 decided the allocation of 9,320 free shares and 480,000 stock purchase or subscription options to some employees and Directors of the Group.

This decision was authorized by the General Meeting of shareholders gathered on 16 September 2014. It will enable to align the interests of the recipient and those of the Group’s shareholders.

Summary regarding dilutive instruments

The dilutive instruments are summarized in the fol-lowing table.

Information on the capital of any member of the Group who is the subject of an option or of a conditional or unconditional agreement to put it under option

Nil.

2.9.4 Acquisition of treasury shares by the Company

In accordance with Articles L.225-209 and L.225-211 of the Commercial Code, it is indicated that the company made the following operations in 2014:

- Acquisition of 415,680 shares to the average price of €9.648 under the liquidity contract

inStrumentS giving aCCeSS to Capital aS at 31 deCember 2014

inStrumentS giving aCCeSS to Capital aS of today

End of exercise period

Parity : Number of shares for 1 BSA

Exercise Price Payment terms

BSA issued in 2004 24 April 2018 1,10 26,20 CashBSAR issued in 2006 24 April 2018 1,07 25,49 CashBSA issued to the benefit of historical shareholders (1) 24 April 2016 0,384615383497979 23,82 CashBSA issued to the benefit of historical shareholders (2) 24 April 2018 0,384615383497979 23,82 CashBSA issued to the benefit of holders of subordinated bonds 31 December 2016 0,027608894 20,01 Cash

31 December 2012 31 December 2013 31 December 2014 Date of publication

Number of shares composing the capital 3 405 679 26 486 213 26 486 482 26 486 621Potential dilutive effect of stock warrants issued in 2004 585 262 643 788 643 788 643 788Potential dilutive effect of stock warrants issued in 2006 130 135 99 521 99 521 99 521

Potential dilutive effect of stock warrants issued to historical shareholders 2 634 771 2 634 502 2 634 363Potential dilutive effect of stock warrants issued holders of subordinated bonds 2 572 093 2 572 093 2 572 093

Potential dilutive effect of free shares 2015 9 320Potential dilutive effect of stock warrants issued in 2015 to employees and managers 480 000

Total number of potential shares 4 121 076 32 436 386 32 436 386 32 925 705

Dilutive effect 17.36% 18.34% 18.34% 19.56%


- Sale of 411,494 shares to the average price of €9.710 under the liquidity contract

For 2014, the amount of negotiation fees is null.

As at 31 December 2014, the company owned 7,123 of its own shares, representing 0.03% of the capital from which 3,686 shares are owned through the liquidity contract. Each share has a nomi-nal value of €2.00. All shares owned as at 31 December 2014, had a total value of €252,651 (acquisition price) and were affected for 3,437 shares to the cover of options or free shares plans and for 3,686 shares through the liquidity contract

2.10 Other information

2.10.1 Details regarding payment conditions of suppliers and of customers

Please see tables below.

2.10.2 Research and development activities

Innovation is in the DNA and at the heart of the Group Belvédère. “We bring value to our clients and consumers by offering trustworthy, bold and full of flavors brands”.

In order to anticipate and answer to the needs of its consu-mers, Belvédère’s R&D Department works closely with the func-tional teams to develop new innovative products. Innovation process is a key factor of differentiation for the products of the Group in their inherent markets.

2.10.3 Non-deductible expenses

As regard Article 223 -4- and 223 -5- of the General Tax Code, it is indicated that the financial statements for year 2014 do not include any non-deductible expenses.

information regarding balanCe of payableS for SupplierS aCCording to expiry date

information regarding balanCe of reCeivableS aCCording to expry date

2014 40 704 0 1 414 35 259 4 031

2013 51 253 0 6 868 18 060 26 325

Not received InvoicesIn € 000

Accouting balance as at 31 December

Not expired receivables

Expired receivables -

Expiry date < 2 months

Expired receivables -

Expiry date > 2 months

2014 36 673 0 1 414 35 259 0

2013 24 928 0 6 868 18 060 0

Not received InvoicesIn € 000

Accouting balance as at 31 December

Not expired payables

Expired payables - Expiry date < 2

months

Expired payables - Expiry date > 2

months


2.10.4 Results of the company Belvédère SA over the last 5 years

artiCleS 133, 135 and 148 of deCree regarding CommerCial CompanieS

in € 2010 2011 2012 2013 2014

1- Year end Financial Situation

Share Capital 6 265 356 6 398 076 6 811 358 52 972 426 52 972 964

Number of shares outstanding 3 132 678 3 199 038 3 405 679 26 486 213 26 486 482

2- Overall result of current operations

Revenues excluding taxes 491 933 248 313 68 080 55 315 4 093 587

Profit / Loss before taxes, amortizations and provisions (40 463 115) (43 983 535) (25 856 646) (40 026 191) (4 248 676)

Income Taxes (3 132 125) (2 752 941) (2 183 276) (5 461 996) (2 697 353)

Profit / Loss after taxes, amortizations and provisions (24 913 961) (47 178 135) (156 812 558) (19 743 063) (8 616 544)

Amount of Profit Disributed - - - - -

3- Results of operations for one share of capital

Profit / Loss after taxes but beforeamortizations and provisions (11,92) (12,89) (6,95) (1,30) (0,06)

Profit / Loss after taxes, amortizations and provisions (7,95) (14,75) (46,04) (0,75) (0,33)

Dividend per share - - - - -

4-Staff

Number of employees 10 9 5 4 11

Staff costs 2 103 485 2 611 164 922 422 1 101 163 1 821 340

Amount paid in relation to social benefits 657 274 719 037 319 920 339 130 678 130

2.10.5 Statutory Auditors

Incumbent Statutory Auditors

MazarsMember of the Compagnie régionale des commissaires aux

comptes de Versailles,Represented by Dominique Muller and Romain Maudry,61, rue Henri Regnault,92 075 Nanterre.

Appointed during the Ordinary General Meeting gathered on 8 August 2008 for a term of six financial years, replacing the firm KPMG.

The appointment was renewed during the Ordinary General Meeting gathered on 16 September 2014.

Thus, the appointment will expire at the end of the Ordinary General Meeting called to approve the financial statements for the year ended 31 December 2019.

SAS Renart, Guion & AssociésMember of the Compagnie régionale des commissaires aux

comptes de Dijon,Represented by Aurélie Trucy1, rue du Dauphiné,21 121 Fontaine-le-Dijon.

Lawfully appointed as Statutory Auditors pursuant to Article L. 823-1 of the French Commercial Code following the resignation of Didier Roux.

The term of office will expire at the end of the Ordinary Ge-neral Meeting convened to approve the financial statements for the year ended 31 December 2014, in accordance with the term of office of the previous audit firm. As stated in the mandate of its predecessor, it will be proposed to the next General Meeting of shareholders to replace it by KPMG SA, 3 cours du Triangle Im-meuble Le Palatin 92939 Paris La Defense cedex for the next 6 financial years i.e. expiration at the end of the Ordinary General Meeting called to approve the financial statements for the year ended 31 December 2020.


Alternative Statutory Auditors

Mr. Gaël LamantTour Exaltis,61 Rue Henri Regnault,92075 Paris La Défense Cedex.

Appointed during the Ordinary General Meeting gathered on 16 September 2014 for a term of six financial years, replacing SCP André & Associés.

The appointment will expire at the end of the Ordinary Ge-neral Meeting called to approve the financial statements for the year ended 31 December 2019.

SARL 2C Audit – Adezio Audit Member of the Compagnie régionale des commissaires aux

comptes de Nîmes,Represented by Cedric Ribeiro,14, Rue Louis Pouzol,84130 Le Pontet

Appointed by the 30 September 2013 Ordinary General Mee-ting for a term of six financial years, to replace Marcel Renart, Guion & Associés.

The term of office will expire at the end of the Ordinary Ge-neral Meeting convened to approve the financial statements for the year ended 31 December 2014, in accordance with the term of office of the previous audit firm. As stated in the mandate of its predecessor, it will be proposed to the next General Meeting of shareholders to replace it by SALUSTRO REYDEL, 3 cours du Triangle Immeuble Le Palatin 92939 Paris La Defense cedex for the next 6 financial years i.e. expiration at the end of the Ordinary General Meeting called to approve the financial statements for the year ended 31 December 2020.

Fees paid to the incumbent Statutory Auditors for the past two financial years

The fees given below represent services performed by the auditors and their affiliate offices in respect of the stated years. The reported amounts have been expensed in the income statement.

In 2014, other works and services directly related to the statu-tory audit are mainly due to diligences regarding internal control.

feeS paid to Statutory auditorS during laSt 2 yearS

Mazars % Renart, Guion & Associés

% Mazars % Renart, Guion & Associés

%

Statutory Audit 1 088 97% 144 100% 1 065 66% 120 99%Belvédère SA 613 55% 144 100% 494 31% 120 99%Subsidiaries 475 43% - - 571 36% 0 0%

Other work and services directly related to the statutory audit

25 2% - - 516 32% 1 1%

Belvédère SA 25 2% - - 516 32% 1 1%Subsidiaries 3 0% - - 0 0% 0 0%

Sub-total 1 116 100% 144 100% 1 581 99% 121 100%

Other Services - - - - 21 - 0 -

TOTAL 1 116 100% 144 100% 1 602 100% 121 100%

Dec-14In € 000

Dec-13


2.10.6 Stock market performance for Belvé-dère share

Stock market data for the BELVEDERE share in 2014 are as follows:

- Number of shares outstanding as at 1 January 2014: 26,486,213

- Opening price as at 2 January 2014: €9.70

- Number of shares outstanding as at 31 December 2014: 26,486,482

- Closing price as at 31 December 2014: €10.84

- Higher price during 2014: €13.07 on 30 September 2014

- Lower price during 2014: €7.66 on 10 July 2014

2.10.7 Financial Communication Calendar for 2015

Starting 2015, the Company communicated about its fi-nancial communication calendar as follows:

- 2014 Annual Revenues: 13 February 2015

- 2014 Annual Results: 12 May 2015

- Q1 2015 Revenues: 12 May 2015

- First Semester 2015 Revenues: 7 August 2015

- First Semester 2015 Results: 30 September 2015

- Q3 2015 Revenues: 10 November 2015

Announcements will be released after the closure of markets.

belvédère Share - StoCK priCe evolution during 2014 (in €)

belvédère Share - trading volumeS evolution during 2014 (in number of ShareS)


Are presented below additional information or updating the management report as prepared by the Board of Direc-tors for the year 2014.

To facilitate reading and referrals, paragraph numbers retained in the 2014 Annual Report are maintained, with simply the « bis » suffix.

2.2 bis Analysis of results and of financial structure at the end of H1 2015

ADDITIONAL INFORMATION TO 2014 MANAGEMENT REPORT

2bis

2.2.1 bis Evolution of Group’s activities in H1 2015

Marie Brizard Wine & Spirits announced on August 7th its unaudited consolidated sales for the first half of the year to 30 June 2015.

On a comparable basis, restated for contracts aban-doned in 2014 (essentially sales of third-party vodkas in Poland) and scope effects (Belarus, India and Galerie Al-koholi in Poland), the Group recorded a +4.5% increase in sales over the first half of 2015 compared with the first half of 2014.

group SaleS’ evolution during firSt half of 2015

In € m

4,5%

H1 2015

221,4 -3,7 -4,5 213,2 7,7 1,8 222,7

H1 2014Abandoned

ContractsPerimeter changes

H1 2014restated


Currency impacts


Key events during the first half of 2015

The first half of 2015 saw the beginning of the imple-mentation of the BiG 2018 strategic plan. A number of events give credence to the success of this plan and reflect the implementation of management best practices within the Group:

- Recuperation of full operational control over the Group’s activities in Bulgaria;

- Putting in place of an Executive Committee consisting of experts from the spirits sector with experience in tur-ning around and growing companies;

- Approval of the 2014 accounts without qualification for first time in 6 years;

- Divestment of Galerie Alkoholi and its 39 liquor stores in Poland to Carrefour;

- Launch of work to upgrade the vodka production in-dustrial tool in Lithuania, preparations for improvement work in Poland;

- Renegotiation of procurement contracts for 2015 and bottle-sourcing contracts enabling the Group to already secure a significant portion of the total sourcing savings expected by 2018;

- Introduction of the Group’s products to new geogra-phical regions, notably William Peel in Poland and Lithua-nia and Fruits and Wine in Poland and Canada;

- Implementation of commercial excellence program as laid out in the BiG 2018 strategic plan and which has already begun to bear fruit in terms of sales performance;

- New 10-member Board of Directors;

- Change in the Group’s name to Marie Brizard Wine & Spirits. Thus, since 5 August 2015, the Group’s name and ticker have been changed to MBWS. Its ISIN code remains unchanged (FR0000060873).

Detailed sales by country

F R A N C E : A R E T U R N TO G R O W T H I N T H E S E CO N D Q UA R T E R O F 2015

Following a 5.3% decrease in sales in the first quarter, essentially as a result of delays in orders of bottling ser-vices on the wine segment as well as delays in promotional activities, the second quarter of 2015 saw growth of +1.8% compared with the second quarter of 2014.

Thus France recorded half-year net sales of €96.9 mil-lion, down -1.3% compared with the previous year.

Over the first 6 months of 2015, wine activity was up 1%, driven by the strong performance of Fruits and Wine in an-ticipation of the summer season and the advertising cam-paign launched in July. Fruits and Wine remains a strong leader in its category with a market share of 28.8% (-0.8 pt vs. the same period of 2014 - Source: IRI P06 2015, BABV).

William Peel, which is continuing to show its strength and is significantly outperforming its market, has consoli-dated its leadership position on the French scotch whisky market (market share of 23.0%, +1.0 pt vs. the same period of 2014 - Source: Nielsen P06 2015, Scotch Blend -12).

Furthermore, Sobieski, another strategic pillar of Marie Brizard Wine & Spirits, is now the #2 vodka on the French market, in line with the objectives announced in the strate-gic plan.

P O L A N D : B U OYA N T G R O W T H F O R V O D K A A N D B R OA D E N I N G O F T H E P O R T F O L I O O F P R O D U C T S S O L D

In Poland, sales were up 10.5% in the first half once fi-gures are restated for the impact of the end of third-party vodka sales in 2014 and the divestment of Galerie Alko-holi. Excluding these adjustments, net sales totalled €84.3 million in Poland over the six months to 30 June 2015, up 4.5% compared with the first half of 2014.

Krupnik has confirmed its position as a major player on the Polish vodka market, with a market share of 13.1% (+1.3 pt vs. the same period of 2014 - Source: Nielsen P06 2015, Vodka). The introduction of commercial excellence tools in Poland has already allowed Krupnik vodka to win back distribution.

Lastly, the Group launched William Peel and Fruits and Wine in Poland, for which the initial effects on sales should be felt in the second half of 2015 and especially in 2016.

U N I T E D S TAT E S : F I R S T TA N G I B L E E F F E C T S O F T H E R E F O C U S I N G O F AC T I V I T I E S O N 9 K E Y S TAT E S

As announced in its BiG 2018 plan, Marie Brizard Wine & Spirits has decided to maintain national distribution in the United States whilst focusing its investments on 9 key states. Thus, and as anticipated, sales in these 9 states over the first half of 2015 increased by 13.1% compared with 2014, significantly outperforming the market. Sobieski has a 2.8% market share in the United States (-0.5 pt vs. the same period of 2014 - Source: Nielsen 13 weeks to 20/06/15, Imported vodkas).

At end-June 2015, net sales in the United States totalled €9.1 million, up +17.2% compared with the first half of 2014 thanks to a positive currency effect. Restated for this impact, sales were down -4.1%, in line with the Group’s forecasts.


Following a decrease in sales during the first quarter of 2015 (associated with further destocking operations amongst distributors and a particularly strong first quarter of 2014 in anticipation of a price increase for Sobieski on 1 April 2014), Marie Brizard Wine & Spirits recorded sales growth of 12% in the United States in the second quarter of 2015.

L I T H UA N I A : F U R T H E R S A L E S G R O W T H

In the first half of 2015, net sales totalled €10.6 million in Lithuania, up 5.2% compared with the same period of 2014. Just like on the Polish market, Marie Brizard Wine & Spirits successfully launched its William Peel brand in Lithuania during the second quarter of 2015.

S PA I N : ACC E L E R AT I O N I N G R O W T H O V E R T H E S E CO N D Q UA R T E R O F 2015

Net sales totalled €5.7 million in Spain over the first half of 2015, up +1.0% compared with the first half of 2014 and up 5.4% in the second quarter of 2015.

Although it took place in November 2013, the effects of the end of the Pulco subcontracting contract at Marie Bri-zard Spain still impacted sales for the first quarter of 2014. On a comparable scope basis, sales in Spain in the first half of 2015 were up +5.8% on the same period of 2014.

B R A Z I L : I N C R E A S E I N S A L E S , E XC LU D I N G T H E C U R R E N C Y E F F E C T

Net sales totalled €2.2 million in Brazil over the 6 mon-ths to 30 June 2015, a decrease of -6.7% compared with the previous year. Restated for the currency effect, sales in-creased by +3.6%.

Jean-Noël Reynaud, CEO of Marie Brizard Wine & Spi-rits comments: “Following a first quarter when we were putting the various elements of BiG 2018 in place, the second quarter

confirmed the pertinence of our strategy. This has been a positive first half, with sales growing by 4.5%, which ended with a change in the Group’s name to Marie Brizard Wine & Spirits and marks the end of the normalisation phase. Marie Brizard Wine & Spi-rits is henceforth an innovative wine and spirits group that is rooted in tradition and places the trust shown by its employees, clients, partners and shareholders at the heart of its strategy. Now governed by management best practices, we are growing again and are recognised for our multiregional and multi-category know-how.

We know our destination and are all determined to reach it together. The developments that took place during the first half of 2015 mean that we can address these challenges full of confi-dence, especially as new opportunities have resulted from the reor-ganisation of our shareholding structure. It is now up to us to define and implement them.”

2.2.2 bis Consolidated results for H1 2015

R E T U R N TO A G R O W T H M O M E N T U M , W I T H S A L E S U P +4.5% O N A CO M PA R A B L E B A S I S

As already announced, over the first half of 2015 the Group recorded sales of €222.7 million. On a comparable scope and restated for contracts abandoned in 2014, sales were up +4.5% compared with the first half of 2014.

S O L I D I M P R O V E M E N T I N E B I T DA , I N L I N E W I T H B I G 2018: +56% V S . H 1 2014

The gross margin for the first half of 2015 was €73.5 million, an improvement of 3.6% compared with the first half of 2014, giving a gross margin as a percentage of sales of 33.0% (vs. 32.1% in H1 2014). This improvement was notably due to the purchasing-cost savings announced in the Group’s strategic plan (BiG 2018), the effects of which should be amplified from the 2nd half of the year onward.

Marketing and promotional spending was down €1.6 million compared with the first half of 2014 because of a

group reSultS’ evolution during firSt half of 2015

€ 000 30 June 2015

30 June 2014

restated *Net sales (excluding excise duty) 222 688 221 370

Gross margin 73 510 70 978

Gross margin % 33,0% 32,1%

Ebitda excluding IFRIC 21 impact 2 552 1 898

Ebitda 1 788 1 147

Operating profit / loss from continuing ops (902) (711)

Operating profit / loss (2 199) (2 184)

Attributable net profit / loss (3 239) (9 646)

* 2014 figures take into account restatements since 31 December 2014, notably onexcise duty


trade discount reallocation on some markets and a better allocation of promotional actions to take into account the stronger seasonal sales in the second half.

As expected, in the first half of 2015 the Group saw an increase in consultancy and advisory fees, mainly asso-ciated with the implementation of the BiG 2018 strategic plan. In 2014, such spending had mainly taken place over the second half of the year.

Personnel costs excluding retirement provisions were up by €1.2 million compared with the first half of 2014 and totalled €31.6 million. This increase was mainly a result of the hiring of personnel since June 2014, notably within the holding company, although this was partially offset by workforce adjustments carried out in Poland and France.

Since 1 January 2015, Marie Brizard Wine & Spirits has been applying the IFRIC 21 interpretation to its accounts, which sets the date certain taxes are written down in ac-counts as the date on which they are required to be paid. To make it possible to compare the 2014 and 2015 financial years, the financial statements for the first half of 2014 have been restated in accordance with IFRIC 21.

This interpretation led the Group to write down a €0.8 million expense in the first half of 2015 and the first half of 2014.

As a consequence, Marie Brizard Wine & Spirits re-corded EBITDA of €1.8 million in the first half of 2015, an improvement of 56% compared with the same half of 2014. If IFRIC 21 had not been taken into account, in the first half of 2015 the Group would have recorded EBITDA of €2.6 million and would have almost broken even in terms of its operating profit from continuing operations.

A €6.4 M I L L I O N I M P R O V E M E N T I N T H E AT T R I B U TA B L E N E T LO S S V S . 30 J U N E 2014

In the first half of 2015, the Group wrote down non-re-curring operating expenses of €3.1 million, essentially as-sociated with the Group’s financial restructuring for €1.3 million and reorganisations carried out in Bulgaria and the United States. The Group furthermore recorded €1.8 mil-lion in non-recurring operating income associated with the divestment of activities carried out over the period.

The first half of 2015 thus saw an operating loss of -€2.2 million, similar to the first half of 2014.

Taking into account a financial loss of approximately -€0.2 million and tax expense of €0.4 million, the Group recorded a €6.4 million improvement in its attributable net loss compared with the first half of 2014, with this loss to-talling -€3.2 million.

S U B S TA N T I A L €35.5 M I L L I O N I M P R O V E M E N T I N T H E N E T C A S H P O S I T I O N V S . 30 J U N E 2014, TO €38.7 M I L L I O N

At 30 June 2015, equity capital totalled €196.5 million and the Group had cash and cash equivalents of €69.0 mil-lion and a net cash position of €38.7 million, a €35.5 mil-lion increase compared with 30 June 2014.

This substantial improvement was a result of:

- A €22 million improvement in operating working capi-tal, i.e. a decrease of 16%, to €117 million at 30 June 2015 vs. €139 million at 30 June 2014.

- The repayment of a €31 million carry-back receivable in February 2015, which was partially offset by the pay-ment of the second dividend of the continuation plan, paid in March 2015 and totalling €14 million. 2

O U T LO O K F O R T H E S E CO N D H A L F O F 2015

The wine and spirits industry is structurally seasonal, with second-half sales outstripping first-half sales.

As foreseen in its BiG 2018 strategic plan, in 2015 Marie Brizard Wine & Spirits launched a number of initiatives ai-med at boosting its sales and optimising its cost structure:

In terms of rationalisation:

- Divestment of Galerie Alkoholi in May 2015

- Preparation of the process to sell off other non-strate-gic assets

In terms of optimisation:

- Renegotiation of sourcing contracts

- Implementation of sales excellence tools

- Reorganisation of distribution networks 3

- Reduction in inventory levels and simplification of the product portfolio

- Launch of work on the vodka distillation project in Lithuania

In terms of growth:

- Internationalisation of the Group’s flagship products (William Peel in Poland and in Lithuania, Fruits and Wine in Poland and Canada…)

- Launch of new brands (Shotka in Spain)

These various strategic initiatives still only had a limited


impact over the first half of 2015, but should truly prove their worth over the second half and in coming years.

Marie Brizard Wine & Spirits’ objective is to achieve 2015 EBITDA close to double that recorded in 2014, which was €5.2 million. It is also reaffirming the financial targets laid out in BiG 2018.

Jean-Noël Reynaud, CEO of Mar ie Br izard Wine & Spirits, comments: “The first half of 2015 saw the start of our strategic plan. The three key areas of BiG 2018 (rationalisation, optimisation and growth) are all progressing in line with our expectations, and the improvement in our results will be visible from the second half of 2015. Our growth is outstripping that of our peers and our brands perfectly resonate with our markets. EBITDA improved over the first half of 2015, but this is only the start and we are determined to accelerate this trend. We knew that the Group had substantial potential. The recent changes in our shareholding structure to include wine and spirits industry experts open up new opportunities to develop our sales and opti-mise our costs. We will reveal these in a “BiG 2.0” publication in December. Lastly, work associated with the restructuring of our equity warrants is currently taking place and should be completed in the coming months.”

Analysis of activity by geographical region

F R A N C E A N D I N T E R N AT I O N A L C LU S T E R : E X PA N S I O N O F M A R K E T S H A R E A N D I N C R E A S E I N E B I T DA M A R G I N E XC LU D I N G M A N AG E M E N T F E E S

The « International cluster » includes Spain, Scandina-via and Marie Brizard & Roger International’s export sales to countries where the Group has no subsidiaries.

This region is the main contributor to Group revenues excluding duties.

In France, after a 5.3% decrease in first quarter reve-nues mainly due to delayed orders under distributor brand contracts in the wines sector and the deferral of promo-tional operations, business picked up again in the second quarter with 1.8% growth over Q2 2014. As a result, first half 2015 net revenues in France amounted to €96.9m, down 1.3% on H1 2014.

- Wine revenues increased by 1% in the first half of 2015, driven by a strong performance from our Fruits and Wine

brand in anticipation of the summer season and the publi-city campaign launched in July. Fruits and Wine remains a strong leader in its category, with a 28.8% market share (down 0.8 percentage points versus H1 2014).

- William Peel, which continues to prove its mettle by largely outperforming its market, confirmed its number one position in the French whisky market (23.0% market share, up 1.0 percentage point versus H1 2014).

- Sobieski, another cornerstone of MBWS’s strategy, be-came the No. 2 vodka brand on the French market, in line with the targets announced in the strategic plan.

Excluding the impact of the management fees in-troduced in late 2014, the France EBITDA margin rose by 1.0 percentage point.

Spain posted first half 2015 net revenues of €5.7m, up 1.0% versus first half 2014, with second quarter growth of 5.4%. Although terminated in November 2013, the Pulco subcontracting agreement with MBWS España still im-pacted first half 2014 revenues. At constant consolidation scope, Spain first half 2015 revenues rose 5.8% on first half 2014.

Denmark posted net revenues of €1.9m, up 26.6% com-pared to the first half of 2014.

P O L A N D : I N C R E A S E D M A R K E T S H A R E

Poland first half 2015 net revenues amounted to €84.3m, up 4.5% over first half 2014. After adjusting for the impact of the cessation of external vodka brand sales in 2014 and the sale of Galerie Alkoholi, Poland net revenues were up 10.5% for the first half.

Krupnik consolidated its position as a leading vodka brand in Poland, with a 13.1% market share (up 1.3 percen-tage points from H1 2014). The introduction of business excellence tools in Poland has already boosted sales of Krupnik vodka.

The Group also launched the William Peel and Fruits and Wine brands in Poland, a development that is expec-ted to bolster second half revenues before generating its full impact in 2016.

franCe & international CluSter p&l

€000 H1 2015 H1 2014restated

H1 2013restated

Ch. 2015 v 2014

Ch. 2014 v 2013

Revenues 113 376 115 364 126 097 -1,7% -8,5%Revenues excluding excise duties 113 376 115 364 126 097 -1,7% -8,5%EBITDA 5 769 6 411 5 163EBITDA margin 5,1% 5,6% 4,1% - 0,5 pt + 1,5 ptUnderlying operating profit/(loss) 4 794 5 289 3 818 -9,4% 38,5%


The 0.7 percentage point improvement in the EBITDA margin over first half 2014 is mainly due to the streamli-ning measures implemented in 2014, which involved cut-ting back the vodka trading business in order to focus on Group own brands and high value-added products.

U N I T E D S TAT E S : I N I T I A L F R U I T S O F N E W S A L E S P O L I C Y

As announced in the BiG 2018 strategic plan, Marie Bri-zard Wine & Spirits has decided to maintain nationwide sales in the United States while focusing on nine key states. Accordingly, in line with expectations first half revenues in these nine states rose by 13.1% compared to H1 2014, lar-gely outperforming the market. Sobieski has a 2.8% share of the US imported vodka market (down 0.5 percentage point from H1 2014).

First half 2015 US net revenues came to €9.1m, up 17.2% over first half 2014 driven by favourable exchange rate de-velopments. Adjusting for changes in exchange rates, reve-nues were down 4.1%, in line with Group forecasts. After a decline in first quarter 2015 revenues (related to ongoing inventory rundown by distributors and particularly high sales in Q1 2014 in expectation of the upcoming Sobieski price hike on 1 April 2014), Marie Brizard Wine & Spirits US revenues rose 12% in the second quarter.

The improvement in the EBITDA margin is mainly due to lower marketing and promotion expenditure, which has been deferred until the second half of 2015.

L I T H UA N I A : CO N T I N U E D G R O W T H , PA R T I C U L A R LY I N T E R M S O F E B I T DA

Lithuania is one of the regions where the Group has a long-standing presence (the Vilnius Degtine distillery was acquired in 2003).

The upward trend that began in 2012 is continuing, with net revenues of €10.6m up 5.2% from first half 2014. As in Poland, MBWS carried out the successful launch of its William Peel brand in Lithuania in the second quarter of 2015.

Thanks to the sales strategy implemented across both domestic and export markets, EBITDA rose by 26.1% from first half 2014 to €1.1m.

B U LG A R I A : G R O U P R E G A I N S CO N T R O L O F I T S S U B S I D I A R Y

First half 2015 was marked by operational and organisa-tional restructuring.

united StateS p&l

poland p&l

€000 H1 2015 H1 2014restated

H1 2013restated

Ch. 2015 v 2014

Ch. 2014 v 2013

Revenues 190 785 169 793 236 215 12,4% -28,1%Revenues excluding excise duties 84 338 80 712 103 036 4,5% -21,7%EBITDA (126) (628) 283EBITDA margin -0,1% -0,8% 0,3% + 0,7 pt -1,1 ptUnderlying operating profit/(loss) (797) (672) (1 801) -18,7% 62,7%

€000 H1 2015 H1 2014restated

H1 2013restated

Ch. 2015 v 2014

Ch. 2014 v 2013

Revenues 9 127 7 787 7 834 17,2% -0,6%Revenues excluding excise duties 9 127 7 787 7 834 17,2% -0,6%EBITDA (331) (3 324) (3 338)EBITDA margin -3,6% -42,7% -42,6% + 39,1 pt - 0,1 ptUnderlying operating profit/(loss) (381) (3 365) (3 378) 88,7% 0,4%

lithuania p&l

€000 H1 2015 H1 2014restated

H1 2013restated

Ch. 2015 v 2014

Ch. 2014 v 2013

Revenues 28 756 27 986 22 602 2,8% 23,8%Revenues excluding excise duties 10 576 10 050 7 512 5,2% 33,8%EBITDA 1 144 907 726EBITDA margin 10,8% 9,0% 9,7% + 1,8 pt - 0,7 ptUnderlying operating profit/(loss) 646 540 151 19,6% 257,6%


B R A Z I L : I M P R O V E M E N T I N E B I T DA M A R G I N

First half net revenues fell 6.7% to €2.2m. At constant exchange rates, revenues were up 3.6%.

2.4 bis Risk factors

2.4.2 bis Business-related risk

Risks relating to the competition

The markets in which the Group operates are highly competitive and very split on price, service, brand awar-eness of and quality of products. Those with whom the Group is in competition are both major international groups of wines and spirits and local producers and distri-butors in some markets.

Thus, can be distinguished from global players, globally present and positioned on high-end markets such as Rémy Cointreau, Pernod Ricard or Diageo.

The Group is the one nearest multi-regional actors such as Campari, positioned in the mid-range segments.

Finally, it should be noted that historically Marie Bri-zard Wine & Spirits is competing with some actors such as La Martiniquaise, Stock Spirits or Alliance Global present them more locally on products more accessible in terms of price.

Commercial dependency and customer risk

In order to assess the risk inherent in the activities of the Group and in particular the dependence with key clients, it is stated that:

the first customer of the Group accounted for 12.6% of sales in fiscal 2014 year,

the top 5 customers of the Group accounted for 32.1% of sales in fiscal 2014 year,

the top 10 customers of the Group accounted for 39.1% of sales in fiscal 2014 year.

2.4.4 bis Legal and other risks

CO M M E R C I A L L I T I G AT I O N

Regarding the commercial dispute between Moncigale company subsidiary of Marie Brizard Wine & Spirits, and Chamarré, it is specified that the hearing, originally sche-duled on 9 October, was postponed to 4 November 2015. It is also recalled that a risk provision has already been re-cognized by the Group in respect of this litigation.

L I T I G AT I O N AG A I N S T M R . E R I C K A N TO N Y S KO R A

Regarding the litigation between Mr Skora and Marie Brizard & Roger International, the company disputes the merits of all requests made.

On September 29th, 2015, the Commercial Court of Créteil has ruled in favor of Mr. Skora and condemns Ma-

brazil p&l

bulgaria p&l

€000 H1 2015 H1 2014restated

H1 2013restated

Ch. 2015 v 2014

Ch. 2014 v 2013

Revenues 2 987 2 250 2 870 32,8% -21,6%Revenues excluding excise duties 2 987 2 250 2 870 32,8% -21,6%EBITDA (706) (878) (317)EBITDA margin -23,6% -39,0% -11,0% + 15,4 pt - 28,0 ptUnderlying operating profit/(loss) (821) (1 029) (1 022) 20,2% -0,7%

€000 H1 2015 H1 2014restated

H1 2013restated

Ch. 2015 v 2014

Ch. 2014 v 2013

Revenues 2 917 3 112 3 328 -6,3% -6,5%Revenues excluding excise duties 2 212 2 370 2 482 -6,7% -4,5%EBITDA 685 688 651EBITDA margin 31,0% 29,0% 26,2% + 2,0 pt + 2,8 ptUnderlying operating profit/(loss) 622 595 517 4,6% 15,1%


rie Brizard & Roger International to pay a contractual in-demnity revocation of his term as Director General.

The company Marie Brizard & Roger International re-serves any right to make an appeal within the statutory pe-riod of one month.

U K R A I N E

As part of the dispute relating to the sale to a third par-ty outside the Group’s control of Belveder Ukraine LLC’s assets, the Court of Appeal of Kiev on 16 September made a decision favorable to the Group, canceling the sale of these assets. This decision is subject to appeal within 20 days after the decision of the Court (period after receipt of the corresponding notification not received to date). As a reminder, the Group had already provisioned the entire value of these assets.

2.7 bis Governance and re-muneration

2.7.1 bis Board of Directors and Managing Directors

Following the General Meeting of shareholders of the Company held on June 30, the composition of the Board is now presented in the following pages.

Additional information about the directors pro-files:

Benoit Hérault: Graduated from HEC and Bareau de Paris, Mr. Herault has significant experience in manage-ment and business administration, including as director of SIIC de Paris and Eurosic, or as Finance Director of Whitehall funds in Europe, responsible for acquisitions in Eastern Europe in particular.

Maria R ita Zniber : Mrs. Zniber is s ince Apri l 2014 Head of Diana Holding, f irst wine group and the 7th among the largest groups of Morocco. It achieves a tur-nover of 3 billion dirhams, generates over 6,500 direct jobs and mainly operates in agribusiness with more than 8,000 hectares of agricultural land. Mrs. Zniber aims to make Diana holding a major player in the Moroccan agro-industry while developing international potential.

Constance Benqué: Holder of a DESS in Marketing and Communication, Mrs. Benqué displays significant ex-perience in the world of media and communication. She was Vice President of Lagardere Active Advertising during 1999-2006 period and is now President and member of the Management Board of Lagardere Advertising (700 em-

ployees for a turnover of € 1.6 billion).

Chr ist ine Mondol lot : M rs. Mondol lot worked wit-hin the Pernod Ricard group, including five years in the marketing department. Between 2000 and 2005, she was President of Kodak Laboratories, Director General of the Consumer Division. Since 2005, she accompanied some companies or subsidiaries of large groups in difficulty, par-ticularly in the Galeries Lafayette and Virgin.

Benoit Ghiot: Graduated from the Solvay Brussels School and Harvard, Mr. Ghiot began his career including KPMG teams before joining the GIB Group as Financial Controller. In 2004, he entered the Avis Europe Board as well as being CFO of Ieteren.

Mehdi Bouchaara: A graduate of the INSEEC Paris (Institut des Hautes Etudes Economiques et Commer-ciales), Mr. Bouchaara works in the Diana Holding Group since 1994, including the functions of Marketing and In-ternational Development, Sales Director. In March 2012, he was appointed Deputy Managing Director in charge of developing the Group before becoming Strategy and De-velopment Advisor of Diana Holding in March 2014.

Serge Heringer: Financial expert, Mr. Heringer holds an MBA and the CFA. He is Senior Banker and notably accompanied the Belvédère Group between 1999 and 2004.

Guillaume de Belair: Graduated from SFAF, French So-ciety of Financial Analysts, Mr. Belair has fifteen years of professional experience in Investment Banking and Asset Management, especially within Natixis teams.

Laurence Dequatre: Mrs. Dequatre exercises since 1994 functions within the Finance Department of Castel Group, in particular as Financial Director of Castel Beer Group (BGI).

Jean-Pierre Cayard: Mr. Cayard is CEO of La Mar ti-niquaise, group founded by his father and now second ac-tor of spirits in France with a turnover of over € 1 billion (brands Porto Cruz, Label 5 or Glen Moray). He also ma-naged to diversify these activities with Repaires de Bacchus wine shops or the website Wineandco.


board of direCtorS CompoSition after 30 june 2015 general meeting (1/2)




Current mandates :CEO of Diana Holding

Member of the Board of Atlas Bottling CompanyMember of the Board of Seven Up

Chairman of the Board of Mr RenouvoChairman of the Board of EbertecChairman of the Board of Thalvin

Chairman of the Board of Domaines Ouled ThalebChairman of the Board of Celliers de Meknes

Chairman of the Board of Maassera Brahim ZniberChairman of the Board of Domaines Brahim Zniber

Chairman of the Board ofDécouvertes & LoisirsAdministrateur de Société Nouvelle de Volailles

Member of the Board of SES WarrenManager of Domaine NamirManager of Domaine Tala

Manager of Domaine de TriffaManager of Gharb WineryManager of Domaine Livia

Manager of Riad de la Clémentine

Co-Manager of K'OzibarManager of Biocompost Brahim ZniberManager of Peppinière Brahim Zniber

Manager of AkaragroManager of Celliers du GharbManager of Viticole du Sais

Co-Manager of Olivim

Current mandates:CEO and member of the Board of Directors of Hachette Filipacchi (SA)

CEO Lagardère Digital France (SAS)CEO of Lagardère Global Advertising (SAS)

CEO of Lagardère Publicité (SAS)CEO and member of the Board of La Place Média (SAS)

Co-manager of Hachette Filipacchi Associés (SNC)Co-manager of Lagardère Métropoles (SARL)

Standing Invitée of Lagardère Publicité and Member of the Board of Média Institute (Association)

CEO and member of the Board of la Fondation Elle (Fondation)Independant member of the Board of Voyageurs du Monde *Independant member of the Board of Fondation Air France

Current mandates:Member of the Board of Directors of Fleury Michon *

Member of the Board of Directors of Vivarte

Other mandates held during the last 5 years:Director of BHV

CEO of Virgin France & InternationalCEO of Virgin Mega

Current mandates:CFO of D'Ieteren SA

Member of the Board of Directors and Chairman of the Audit Committee of Belron SA

Member of the Board of Directors of Volkswagen D'Ieteren Financial Services SA

Member of the Board of D'Ieteren Treasury SAMember of the Board of D'Ieteren Vehicle Glass SA

Member of the Board of D'Ieteren Trading BVMember of the Board of Dicobel SA

Current mandates:Development and Strategic Adisor for Diana Holding

Other mandates held during the last 5 years:Deputy Director of "Celliers de Meknès"

* : Company listed in France ** : Company listed abroad

Mehdi Bouchaara Director representing Diana Holding

Co-opted by the Board of Directors on 24

October 2014, decision ratified during the General Meeting of

Shareholders on 30 June 2015

General Meeting of Shareholders to be held to approve the financial statements for the year

ending 31 December 2018


Member of the working group dedicated to "Strategic Committee"

Christine Mondollot Independant Director

Appointed during the General Meeting of

Shareholders on30 June 2015



Chairman of the Nominations and Remunerations Committee


Riverside Management, represented by Benoit Ghiot

Independant Director





Chairman of the Audit Committee

Rita Maria ZniberDirector representing

Diana Holding


Shareholders on 16 September 2014

Appointed Vice Chairman on 30 June 2015



Member of the Nominations and Remunerations Committee

Constance Benqué Independant Director





Member of the Nominations and Remunerations Committee


Benoit HéraultChairman of the Board of

DirectorsIndependant Director



Appointed Chairman on 30 June 2015



-

Current mandates:Member of the Board of Directors and Member of the Investment

Committee of Alstria REIT **Senior Advisor of Westbrook Advisors


2.7.2 bis Remuneration of the members of the Board of Directors and of the Directors

Regarding Mr. Reynaud:

The fixed remuneration paid in 2014 to Mr. Jean-Noël Reynaud was prorated based on the date of his arrival in the Company.

Furthermore, it is stated that Mr Reynaud benefits:

- A variable bonus subject to the achievement of targets set by the Remuneration Committee and approved by the Board of Directors, variable remuneration applicable up to 2/3 on the basis of qualitative criteria and up to 1/3 on the basis of quantitative criteria, particularly criterion related to EBITDA margin level displayed by the Group.

- A deferred bonus subject to the fulfillment of collective three years performance criteria set by the Remuneration Committee and approved by the Board of Directors.

The variable compensation is a maximum equal to 100% of the fixed compensation paid to Mr. Reynaud.

During the year 2014, finally, Mr. Reynaud has not re-ceived any benefit in kind.

Contrary to what was disclosed within the 2014 mana-gement report, as set out in particular in paragraph 2.7.2 of this document, Mr. Reynaud enjoys an advantage (or likely to be of ) by reason of the termination or change its functions, namely the receivership by the Company of an amount of two hundred and ninety-four thousand euros (€ 294,000) to enable the payment of amounts relating to the guarantee set up for his benefit.

It is recalled that this guarantee was the subject of a re-gulated agreement whose provisions were approved at the last General Meeting of 30 June 2015.

Regarding Mr. Hérault:

Refer to the tables within following pages.

board of direCtorS CompoSition after 30 june 2015 general meeting (2/2)




Current mandates:None

Other mandates held during the last 5 years:Member of the Board and Financial Director of

Caisse d'Epargne de Bourgogne et Franche Comté

Managing Director of Russell Investments, Southern Europe and Africa Area

Managing Director of Natixis Corporate and Investment Bank

Current mandates:Chairman of Panda Equity Research

Other mandates held during the last 5 years: None

Current mandates:Directors of Société des Brasseries et Glacières Internationesl (BGI), of

COPAGEF, of SOMINFOR, of BRALICO and of SUMOL + COMPALPermanent representative of COPAGEF within SOMDIAA

and of Magrheb Investissement within SFBTOther mandates held during the last 5 years:

NoneCurrent mandates:

Board member of R.A.B.M.G., of S.P.C.R.G., of Bruggeman, of EABP, of EAMP and of S.P.C. Littee

Chairman of SIS, of Sogim, of Aveze, of Bardinet, of Busnel, of Casanis, of Da Silva, of Duval, of Justino Henriques, of NSCR,

of R.M. Saint James Chairman of Rhumerie du Verso, of Rivière du Mas, of SBANA, of

Sedra, of Saint Raphael and of SVS LM

Manager of Repaire de Bacchus, of SCI Héritier Guyot, of Grand Cruz, of Grand Cruz Turismo, of Halle aux Vins, of Opteam Spirit and of Uniao

Manager Director of Compagnie Franco Hell, of Ducastaing, of Peureux, of Glen Morey Distillery, of Glen Turner and of Label 5 First

President of the Management Board of COFEPP and Member of the Management Board of Glen Livet

Chairman of the Board of Celebrity SRL and of DilmoorMember of the Management Board of Sucrerie des Antilles and of

Distillerie de la TourOther mandates held during the last 5 years:

Vice Chairman of Barbinet Gelida, Chairman of the Board of Dillon and of Slaur, Chairman of Bourdouil

Director of S.R.M.G., of Gardel, of Martinho and of SPV

Jean-Pierre CayardNon Independant

Director






Serge HeringerDirector representing

Diana Holding





-


DF Holding, represented by

Laurence Dequatre

Non Independant Director





-

Guillaume de Belair Independant Director






2.7.3 bis Functioning of management and supervisory bodies

Until 27 March 2014, the Board had wished to main-tain the uniqueness of the Chairman of the functions of Chief Executive Officer in order, in a context of collective proceedings, to avoid dilution of the powers of direction and responsibility relating thereto.

The Board of Directors of 27 March 2014, however, de-cided to separate the functions of Chairman of the Board and Chief Executive Officer as part of the implementation of the new governance of the Company initiated 30 Sep-tember 2013.

This separation of the duties took effect the 5 May 2014 for arrival of Mr. Jean-Noel Reynaud as new Chief Execu-tive Officer. This dissociation should bring greater opera-tional responsiveness to the Company.

2.8 bis WorkforceAt end-June 2015, the Group’s workforce totaled

2,332, down by 160 people, mainly because of the sale of some businesses in Poland.

m. herault detailled remuneration

m. herault SoCial StatuS


M. Benoît Hérault Chairman of the Board

Fixed remuneration - - 0 € 0 €Annual Variable Remuneration - - 0 € 0 €Pluriannual Variable Remuneration - - 0 € 0 €Extra-ordinary Remuneration - - 0 € 0 €Attendance Fees - - 96 233 € 96 233 €Benefits in Kind - - 0 € 0 €

Total - - 96 233 € 96 233 €

2013 2014

Employment Contract

Additional pension scheme

Remuneration, compensation or benefit items due or likely to be

due as a result of taking up, resigning or changing duties

Compensation relating to a non-competition clause

Date of end of functions within

the Company

-Benoît Hérault

CEO No No No No

m. herault remuneration

2013 2014

M. Benoît Hérault Chairman of the Board

- 96 233 €

Due Remuneration allocated during the financial year - 96 233 €Pluriannual Variable Remuneration allocated during the financial year - 0 €Value of options allocated during the financial year - 0 €Value of free-shares allocated during the financial year - 0 €


3.1 Information regarding staff and environmental in-formation and social com-mitments to sustainable de-velopment

Article 225 of the French Act of 12 July 2010, known as the Grenelle 2 Act, as amended by the Act of 22 March 2012, amends the French “New Economic Regulations” (NRE) Act and introduces provisions regarding the publication of information on corporate social responsibility (CSR).

The Act was supplemented by two implementing decrees, which have been included in the French Commercial Code:

- the Decree of 24 April 2012, which sets out the application thresholds for the Act and lists the information to be provided;

- the Decree of 13 May 2013, which specifies the procedures whereby the independent third-party body performs its verifica-tion assignment.

SOCIAL AND ENVIRONMENTAL RESPONSIBILITY REPORT

33.1.1 Belvédère worldwide

The Belvédère Group is one of the global operators on the wines and spirits market, covering both Europe and the United States with strong local operations. The Group is building up a valuable portfolio of spirits brands, which include Sobieski, William Peel and Marie Brizard.

The Belvédère Group is sensitive to its constantly changing markets, to global diversity, to the rules and customs specific to each region, and to the rapid change in the global political and economic environment.

The Belvédère Group’s employees contribute to the interna-tional expansion of its businesses while respecting the culture, customs and history of each country, as well as national, regional and international laws and regulations.


3.1.2 Belvédère: Key Group data

belvédère worldwide

belvédère Key group data

2 493Employees at December 2014

466,7 M€2014 Group Net Revenues

Geographical breakdown of 2014 revenues

sour

ces

AC N

iels

en. I

mpa

ct D

atab

ank

et S

ymph

ony

Iri G

roup

VODKASCOTCHWHISKY

LIQUEURSFLAVORED

WINES

# 3 IN FRANCE# 3 IN POLOGNE

KRUPNIK AND SOBIESKI2 Polish rooted Vodkas

WILLIAM PEEL # 1 in a leading market in

the World: France# 9 worldwide

MARIE BRIZARDRecognized flavor assemblage know-how

of Marie Brizard

FRUITS & WINE # 1 in France

4 STRATEGICPILLARS

1 2

3 4

38% Poland

46% France

5% Lithuania

4% USA

1% Denmark

6% Others

North America

South America

Europe

Asia


3.1.3 Our mission statement

“ We deliver value by providing our customers and consumers with trustworthy, bold and flavorful brands”

3.1.4 Our values

«A series of values and principles that guide the prac-tices of the “new Belvédère”»

3.1.5 Our strategy

Our aim is to become a major player in the wines and spirits sector. This ambition is reflected in our “Back in the Game 2018” strategic plan. The Belvédère Group wants to

work in a manner that is respectful of sustainable develop-ment and people.

A renewed governance process

The Board of Directors, which is chaired by Benoît Hé-rault, primarily consists of independent members with complementary expertise who are able to drive Belvédère’s growth.

The Board of Directors appointed Jean-Noel Reynaud as Chief Executive Officer of the Belvédère Group in April 2014. Mr Rey-naud’s priorities in 2014 were to set up a management team and to encourage an integrated and properly calibrated operating process in order to determine and successfully implement the 2018 BiG strategic plan over the coming years.

group valueS

reCent eventS

APRIL 2013

Completed retsructuring of existing debt throught a debt to equity swap of €532m

OCTOBER 2013

Creation of an Audit Com-mittee by the Board

APRIL 2014

Jean Noël Reynaud appointed as CEO

JULY 2014

Belvédère shares exited from «compartment spécial» of Euronext Paris

SEPTEMBER 2014

Benoît Héraultnominated Chairman of Belvédère

SEPTEMBER 2014

Entry of Diana Holding at capital (13,1% of share capital)

DECEMBER2014

Launch of the New Strategic Roadmap 2015-2018

2015

BiG 2018 Plan(Back In the Game)

2013 2014 2015


A sound financial position

The Belvédère Group has reduced its debt and reported an underlying operating profit in 2013, even before the introduction of the first good management initiatives de-cided in 2014.

Buoyed by strong brands with strong multi-regional roots, Bel-védère is positioning itself as the main challenger on the wine and spirits market; the Group’s ambitious development is based on four priorities:

- Vodka, primarily with Sobieski and Krupnik;

- William Peel on the Scotch whisky market;

- Marie Brizard, with recognised expertise since 1755, on the spirits market;

- Fruits & Wine on the flavoured wine-based beverages mar-ket.

3.1.6 Scope of the report

Given the nature of the Belvédère Group, it is necessary to organise a “variable-geometry” scope depending on the subject of the indicators.

Where applicable, it is accepted that companies joining the Group in Year N on or after 1 January are not included in the scope of this report. These companies will follow non-financial reporting procedures from Year N+1.

The entities included within the scope of the 2014 CSR 1 report form part of the Belvédère Group’s financial scope and are fully consolidated within the Group’s scope.

The subsidiaries were included in the scope in a manner that is consistent with the size of the aggregate headcount based on the dual activity criterion (production and mar-keting), i.e. 83% of the Belvédère Group’s employees in 2014 divided between Poland 2, France (excluding the hol-ding company), Spain, the Baltic states and Brazil.

I t is worth noting that the environmental data only concerns production facilities and excludes facilities exclu-sively devoted to sales and marketing.

Note 1: Report on Corporate Social Responsability

Note 2 : Only the six largest entities in terms of headcount were included in the

2014 CSR scope

3.1.7 Ethics and exemplarity

Business ethics and exemplarity are the guidelines of our governance process, and the framework for our social and environmental responsibility policy. The members of the Executive Committee and the country Managing Di-rectors are responsible for implementing them in the ope-rating activities.

1. Business and Ethics Codes

Our Business and Ethics Codes were adopted in Janua-ry 2014. These codes set out the basic principles that every employee must comply with when acting on behalf of the Group. Each one of us is responsible for applying the co-des when performing our duties.

Our Business Code specifies that the Belvédère Group has a zero tolerance policy in terms of breaches of human rights

2. Compliance with laws and regulations in force

We pay par t icular attention to the concept of c i -tizenship. The Belvédère Group condemns any il legal, criminal or morally unacceptable act, and takes rapid and appropriate measures against such acts.

The Belvédère Group is committed to complying with the laws in force and takes appropriate measures to handle any illegal or criminal act or any act that breaches the Group’s rules and poli-cies.

No exception to this commitment will be tolerated, re-gardless of whether an illegal act is motivated “by Group interests”, “by Client interests” or committed on the ins-tructions of a line manager.

baCK in the game 2018 StrategiC goalS

B AC K I N T H E G A M E 2018

1UNIQUE

POSITIONING: a challenger at the

heart of the wines and spirits market

2TARGETS FOR 2018:

EBITDA margin of 12% - 15% and core business growth of

25% - 35%

3OPERATIONAL

AREAS:Rationalization, Optimization,

Growth

4 STRATEGIC

PILLARS: Vodka, William Peel,

Marie Brizard, Fruits & Wine

5 KEY MARKETS:

France, Poland/Baltic States, United States,

Spain, Brazil


Compliance with laws and regulations (including fair business practices) is a principle:

- expressed by the Belvédère Group in its Business Code,

- reflected in the business reviews performed by senior mana-gement and/or by Internal Audit whenever necessary.

3. Customer satisfaction

The Belvédère Group complies with the principles of free trade and arm’s length dealing. An ambitious marke-ting strategy has been introduced in order to achieve cus-tomer satisfaction.

The Group develops products that meet customers’ expecta-tions, based on the concept of “customer satisfaction”. Likewise, the marketing and sales strategy offers attractive products that meet customers’ various requirements.

We take care to protect and inform our existing and prospec-tive customers.

4. Alcohol in society

Millions of consumers value our products. We therefore wish to play a positive role in the wines and spirits indus-try.

Relationships with alcohol differ depending on individuals, cultures, communities and countries. Some people have made the choice not to consume alcohol. The Belvédère Group respects that choice.

We acknowledge that some individuals must not consume alcohol, such as minors and people with a serious medical condi-tion.

We strongly condemn the excessive consumption of alcohol. Alcohol abuse is a major concern for a Group such as ours. Such behaviour harms the reputation of our high-quality products and the image of our consumers.

The Belvédère Group encourages the reasonable consump-tion of alcohol via highly targeted communications.

Furthermore, consumers identified as sensitive are provided with information specifically intended for them, such as the pre-gnant woman logo on alcohol bottles and the details of allerge-nic substances listed on the back label for allergy sufferers.

FOCUS

Dubar, our Brazilian subsidiary, which is a member of the Abrabe organisation 3, promotes the reasonable consumption of alcohol and seeks to prevent drink-driving (communications via the company’s website, in bars and restaurants, on the radio, so-cial networks, etc.). 13 advertisements were broadcast on YouTube (80,000 views) in February 2014.

Note 3: Associação Brasileira de Bebidas

5. Adhesion to the fundamental ILO conventions

All Belvédère Group subsidiaries comply with the fun-damental ILO 4 conventions, which specifically cover free-dom of association and the right to collective bargaining 5, the prevention of discrimination in terms of employment and profession 6, the prevention of forced or mandatory labour 7 and the effective abolition of child labour 8.

Note 4: International Labor Organization

Note 5: See the Chapter on «Our social role», point 3.


Note 7: See Belvédère Group Business and Ethics Codes


3.1.8 Our social role

1. Our employees are our main asset

We want our employees to achieve their full potential. Accordingly, we aim to create a stimulating and friendly atmosphere and a safe working environment.

Innovating, fostering dialogue, developing talent and ensuring employee safety are priority issues. Our em-ployees are our most precious asset. They are our Group’s DNA and embody the spirit of innovation on which the Belvédère Group was built.

We want our employees to buy in to our strategy and values. Accordingly, our employees’ commitment to the Company’s goals and values has enabled the Group to face the troubled en-vironment of the past few years.

The Group is proud to be an employer that gives everyone the same opportunities and that encourages its employees to share their ideas and thus contribute to the Group’s development as part of an ongoing improvement process.

We are moving forward to achieve our targets together.

2. Our employees’working environment

One of the Belvédère Group’s priorities is to ensure the conditions for our employees’ health and safety in the workplace. All Belvédère Group companies comply with the conditions for health and safety in the workplace. Health and safety training accounted for 34% of the trai-ning hours followed in 2014.

Overtime is only used in emergency situations, and working hours are customised for parents of young children (remote wor-king or adjusted working hours for women who have chosen to breastfeed their children).

FOCUS

Our Dubar subsidiary has invested in training and equipment in order to promote safety in the workplace. We comply with Bra-zilian standards NR-35 for working at heights, NR-12 on ma-


chines and equipment, and NR-17 on ergonomics.

3. Dialogue with our employees

Talented individuals work at all levels of the Group’s organisational structure and must find ways of working together so that overall performance targets are achieved. The search for such synergies forms part of the framework of employee dialogue.

Belvédère establishes an in-depth dialogue with its staff re-presentatives.

This dialogue includes discussions, consultation processes, ne-gotiations and joint initiatives undertaken by staff representative organisations.

FOCUS

The Group’s senior management received very positive feed-back when it presented the 2018 BIG strategic plan to our em-ployees and staff representative organisations. This shared expe-rience is representative of the dialogue-based approach favoured by senior management.

Communicating with our employees is one of our Group’s priorities.

4. Equal treatment

In terms of employment law, all Belvédère Group sub-sidiaries comply with statutory provisions relating to gen-der equality, the employment and social integration of di-sabled people and the prevention of discrimination.

Furthermore, the Belvédère Group set down the values to which it is committed by working on the publication of the Group’s Business Code and Ethics Code in 2013. The codes were circulated to all Group companies in 2014.

5. Enhancing our employees’skills

Developing our employees is an investment and major growth driver. We need to support our employees so as to achieve our ambitions and strategic goals.

All Belvédère Group subsidiaries work on training their em-ployees and pay particular attention to quality and security.

Over 10,000 hours were dedicated to training, 34% of which were entirely dedicated to health and safety across the 2014 CSR scope.

3.1.9 Our environmental role

1. Overall environmental policy

With regard to environmental protection, the Group has focused its attention on four priorities.

P R I O R I T Y #1 - R E S P E C T F O R T H E E N V I R O N M E N T

Each subsidiary manages its environmental policy on a local basis, depending on its business activities and local laws and regulations. The subsidiaries have the necessary administrative authorisations and have taken out the man-datory insurance for their business activities.

breaKdown of headCount

Headcount France Spain Poland Baltic States Brazil Total 2014 CSR scope *

Total year end headcount 453 75 1 279 251 20 2 078

Breakdown of headcount by age group France Spain Poland Baltic States Brazil

Total 2014 CSR scope

Under 25 years 15 1 29 16 0 61

25 to 34 years 94 9 379 69 5 556

35 to 44 years 117 24 413 79 4 637

45 to 54 years 153 28 291 60 6 538

Over 55 years 74 13 167 27 5 286

Breakdown of headcount by gender France Spain Poland Baltic States Brazil

Total 2014 CSR scope

Women 171 25 414 109 6 725

Men 282 50 865 142 14 1 353

* 2 493 employees work at the Belvédère Group


FOCUS The Brazilian CETESB 9 organisation checks the compliance of

the operating process with current environmental regulations and grants an operating licence that is valid for two years. The most recent certification dates from 5 February 2014.

Note 9: Companhia Ambiental do Estado de São Paulo

The Belvédère Group takes measures to prevent environmen-tal risk and pollution.

All Belvédère Group subsidiaries are committed to acting in compliance with the laws and raising employee awareness about environmental issues.

FOCUS

Our Polmos Lancut plant in Poland regularly provides envi-ronmental protection training sessions for all employees and spe-cific safety training for plant workers, prompted by the directives issued by the Polish Training Ministry via BEHAPEK, an exter-nal company based in Rzeszów.

In addition, employees who are directly involved in the pro-duction process must attend an internal training course in ac-cordance with the ISO 10 and HACCP 11 procedures every year. The training course focuses on reducing the adverse impact of the production process on the environment by sorting waste, reducing noise pollution, etc.

Note 10: International Organization for Standardization

Note 11: Hazard Analysis Critical Control Point

P R I O R I T Y #2 - F O C U S O N WAT E R A N D E N E R G Y CO N S U M P T I O N

Water is fundamental for the life of individuals, fami-lies and local economies. It is also fundamental to our Company’s long-term future. Water management is a high priority. Initiatives aimed at managing and reducing the consumption of water and energy have been reviewed at all the production facilities. The facilities’ water consump-tion is monitored and assessed in order to avoid overruns. Attention is also paid to monitoring industrial waste water discharges in order to minimise their impact on the envi-ronment.

Energy consumption is also monitored and improvements sought.

FOCUS

An online conductimeter was installed at our Fondaudège fa-cility in 2014. This enabled us to improve the way the rinse water flows into the waste water reception tank. This water is then sent to a treatment centre.

The historic drought in the State of São Paulo in 2014 led us to review the water used in the production process on a local basis.

Besides other measures, Dubar, our Brazilian subsidiary, began recovering the water from its cooling tower, using specific tanks for each product (less washing) and adjusting and improving the rinser.

P R I O R I T Y #3 - T H E WA S T E M A N AG E M E N T P O L I C Y

A large amount of Group waste, including glass and cardboard boxes, is recyclable. We have looked at impro-vements in the following areas:

- waste sorting;- monitoring waste;- using (nearby and approved) recycling outlets for all the

waste amounts in question.

P R I O R I T Y #4 - PA R T N E R S H I P S W I T H G R O U P S U P P L I E R S

We seek to raise our suppliers’ awareness of protecting the environment.

FOCUS

A “sustainable development” questionnaire has been sent to the main suppliers of the Marie Brizard Group 12, with a view to drawing up a summary of those suppliers’ practices from an environmental standpoint.

Moncigale prioritises local suppliers that apply environ-ment-friendly principles.

Note 12: MBRI

2. Pollution and waste management

The Belvédère Group is aware of the impact of its acti-vities on the environment and implements processes aimed at preventing its activities from having an adverse impact on the atmosphere, water and soil. In addition, the Belvé-dère Group’s subsidiaries have the authorisations required for their operations. The Belvédère Group seeks to prevent environmental risks on a preventive basis.

A water quality monitoring programme has been introduced at the production facilities.

FOCUS

At our Fondaudège facility, weekly water analyses are perfor-med and reported to the DREAL 13 and to Lyonnaise des Eaux. The related pollution coefficient is monitored on a monthly basis. Furthermore, some of the most polluted water is separated and processed at an external waste water treatment plant, in order to comply with regulations. To prevent any risk of pollution in the event of a major leak, our Fondaudège facility is technically capable of shutting itself off from the public network.

At our Lormont facility, we monitor the quantitative and qua-litative parameters of water discharges, including outflows from


the waste water treatment plant.

Note 13: Regional environment, development and housing depart-

ments

In addition to a waste sorting policy implemented at the various subsidiaries, the Belvédère Group ensures that waste is managed in compliance with local laws and regu-lations.

In the more specific case of industrial waste, the subsidiaries have signed agreements with specialised sub-contractors autho-rised to collect, transport and treat industrial waste.

In the case of recyclable materials, the Group systematically looks for recovery outlets in order to reduce the amount of waste.

FOCUS

Our Cognac Gautier facility, which is located in the city centre, limits its impact and remains ICPE 14 classified and the-refore subject to authorisation. Apart from the regulatory aspects, we are committed to sorting our waste and to ensuring its recove-ry through approved outlets.

Note 14: Facilities classified for environment protection in France

3. Noise and other forms of pollution

The Belvédère Group has not identified any noise or light nuisance that exceeds current standards or incurred any administrative sanctions relating to this issue. Howe-ver, the Group remains vigilant, and complies with local regulations and special restrictions.

In France, the noise pollution standards determined by the DREAL are complied with. Ear plugs have been provided to all production employees.

4. Sustainable use of resources

The Belvédère Group monitors the rational use of the raw materials required for its business activities. Initiatives are implemented to reduce the consumption of raw mate-rials.

FOCUS

In Brazil, Dubar uses a cardboard box made from recycled sugar cane to package its products.

An initiative to reduce the weight of bottles involving William Peel began at the MBRI Group in 2009. We extended this best practice to our Sir Pitterson bottles in 2014. This initiative en-abled us to save 4,665.39 tonnes of glass during the year.

In France, we mostly use recycled glass bottles in our produc-tion process, since:

- Glass is 100% recyclable. 7 out of 10 bottles are now recycled.

- Glass can be melted down over and over again in order to manufacture new glass bottles, with no loss of material, quality or transparency.

Recycling glass enables us:

- to save energy. A 10% increase in recycled glass in order to replace virgin raw materials enables an energy saving of 3%;

- to limit CO2 emissions. One tonne of recycled glass saves over 500 kg of CO2;

- to reduce the use of raw materials. We save 1.2 kg of virgin raw materials for every tonne of cullet used to replace raw mate-rials.

- to optimise our logistics process, and so minimise our trans-port-related carbon footprint. The recycled glass comes from local collection points that are close to the glass manufacturing plants;

- to extract maximum value from the glass collected before it is sent to landfill or incinerated.

Furthermore, managing the main sources of energy used at the Belvédère Group is vital.

The main types of energy used by the Group are:

- electricity,- heating oil,- natural gas and diesel,- propane, - coal.

The consumption of these types of energy during 2014 is set out in the “Key Indicators” appendix. They represent the main source of the CO2 emissions generated by the Group in 2014 (which have not been quantified to date).

Renewable energy is consumed via the energy packages in the countries where we use electricity. We have no specific re-newable energy supplies.

The Belvédère Group entities try to limit their energy consumption, where possible.

FOCUS

To reduce its energy consumption during 2014, our Cognac Gautier subsidiary:

- installed LED lighting outside and inside the building;

- changed the heating system used in the production process.

Given its subsidiaries’ operating locations, the Belvé-dère Group has not identified any specific risk to the natu-


ral water resources used.

Water consumption is proportional to production and may also be used for technical purposes (e.g. cooling systems). Around 523,604 m³ of water was consumed in 2014.

The Belvédère Group takes care not to cause any chro-nic or accidental soil pollution at all the facilities that it operates, by ensuring proper storage and usage conditions for its raw materials and by managing rain water and the discharges generated during rain water treatment pro-cesses.

FOCUS

Our Mongicale subsidiary and its main transportation com-pany have launched an initiative aimed at raising awareness of biodiversity. 80% of the transportation company’s vehicle fleet meets the Euro 6 standard, which is the latest emission standard to be issued.

The Marie Brizard Group drew up an inventory of direct and indirect greenhouse gas emissions generated by its plants in 2011. The purpose of this report was twofold:

- to identify the main emission sources (alcohol, sugar and glass bottles);

- to plan possible short, medium and long-term reductions.

A review was performed following the greenhouse gas emission report, primarily on packaging, which is one of the main sources of greenhouse gas emissions. Accordingly, eco-design initiatives, such as reducing the weight of some bottles, were initiated with some of our suppliers.

The gradual reduction in the weight of bottles representing the largest sales volumes enabled a reduction in the number of supply trucks and the optimisation of the finished product pallet-packing process.

5. Climate change and biodiversity

Climate change and the resulting potential regulatory changes are a challenge in terms of procurement and pro-tecting the production process against weather phenome-na.

FOCUS

In France, audits at our suppliers are performed according to a determined annual timetable. The social and environmental aspects are reviewed.

A statement certifying the compliance of their packaging with the French Environment Code is completed by all our dry goods suppliers.

Furthermore, a sustainable development questionnaire is sent

to MBRI’s suppliers, in order to encourage them to use organic farming and to protect the environment. This measure to raise supplier awareness, primarily concerning the protection of bio-diversity via organic farming, is a best practice that needs to be extended to the whole Group.

3.1.10 Our social role

Driven by its determination to preserve the Earth’s re-sources and to protect biodiversity, the Belvédère Group seeks to produce environmentally-friendly products and to design the appropriate processes.

1. Regional, economic and social impact of the Company’s activities

The entire Belvédère Group prioritises local candidates for every type of position.

In Lithuania, our “AB Vilnius Degtiné” subsidiary is one of the 15 leading contributors to employment in Lithuania on a national basis.

In Poland, our Sobieski Trade subsidiary is involved in the economic development of the Witkowo district by creating and maintaining a large number of jobs.

Likewise, the Polmos Lancut plant is a major employer in Vo-voida province in the Lower Carpathian region, which has a high unemployment rate. The plant impacts local trade and company start-ups by encouraging employment via the purchase of raw materials and components.

The Belvédère Group aspires to have a social impact via corpo-rate sponsorship campaigns. This ambition, which was stated in 2014, was illustrated by our involvement in an event showcasing the Thracian civilisation in Sofia and Paris in 2015.

Our subsidiaries in France support several local voluntary or-ganisations.

2. Relations with stakeholders affected by the Company’s business activities

In France, MBRI has entered into a partnership with a work-based assistance service institution near Bordeaux, in order to sub-contract certain joint packing operations.

Our Fondaudège production facility employs a team of di-sabled persons on-site as part of this partnership. This team, which is managed by a workshop supervisor, performs various joint packing assignments (affixing stickers and tax stamps, pallet re-packing, etc.)

This kind of professional inclusion enables these individuals to find out about working in a normal environment.

We also take on students as interns on a regular basis.


3. Sub-contracting and suppliers

Our relations with suppliers and sub-contractors are based on respect for the values expressed in the Belvé-dère Group’s Business Code. Generally speaking, when sub-contractors are used, Management ensures proper compliance with the laws and sees that sub-contractors consider the impact of their actions on the environment and employee relations.

FOCUS

In France, the MBRI production facilities use suppliers who:

- refer to the directives relating to social and environmental protection;

- work in compliance with the laws, especially with regard to environmental protection.

Suppliers and sub-contractors must implement a socially res-ponsible policy with regard to the environment.

For example, Moncigale advises its wine suppliers to use sen-sible farming methods, in order to limit discharges into the soil and water courses. The Company supports reducing the use of in-secticides in vineyards.

4. Consumer food safety

The Belvédère Group develops its products with a view to constantly exceeding customer expectations. Our guide-line is to offer our clients and consumers reliable, bold and flavoursome brands.

Offering high-quality products involves complying with the hygiene and health standards in the wines and spirits sector. Our customers’ safety is not only a priority - it is also a duty.

All the production facilities in France, Lithuania and Poland are ISO 9001 certified and have adopted an HACCP 15 approach.

Note 15: Hazard Analysis Critical Control Point

FOCUS

In 2014, our Moncigale subsidiary successfully obtained ISO 9001 Version 2008, IFS 16 Version 6 Higher Level, BRC 17 Version 6 Grade B and ECOCERT certifications (including an organic certification for Fruits & Wine).

The Marie Brizard Group has specifically identified the fol-lowing three Critical Control Points (or “CCPs”) as part of its ha-zard assessment method:

1. CCP1 - filtration (hazard of foreign bodies): overseeing the effectiveness of the filtration system by monitoring the pressure difference ;

2. CCP2 - blow moulding (hazard of foreign bodies): overseeing the operation of the blower by monitoring the air pres-sure;

3. CCP3 - pasteurisation of syrups (micro-biological ha-zard): overseeing pasteurisation levels by monitoring product temperature.

The CCPs in place enable a hazard to be eliminated or re-duced. These essential stages in the production process are moni-tored according to stringent procedures.

Note 16: International Featured Standard

Note 17: British Retail Consortium

3.1.11 Appendices - Reporting methods

Reporting standards

The non-financial reporting protocol describes the procedure for reporting the Belvédère Group’s environ-mental, staff and social indicators in respect of its two bu-siness areas, i.e.

- production; - marketing of wines and spirits.

This document also constitutes:

- an internal benchmark for individual contributors;- a benchmark for external data verification.

The Belvédère Group has drawn up its CSR reporting protocol in accordance with the information identified in Article 225 of the Grenelle 2 Act of 12 July 2010 and its implementing decree dated 24 April 2012.

This document will be reviewed on an annual basis as part of an ongoing improvement approach, depending on:

- changes in the Belvédère Group reporting process; - feedback.

The environmental data is gathered from each business acti-vity and consolidated at Group level. The rules for determining the CSR scope are specified in the section entitled “CSR Scope”. For 2014, the environmental data only covers production facili-ties.

3.1.12 Appendices - Definitions

1. Year-end headcount

The headcount (or employees) corresponds to the indi-viduals who have an employment contract with the entity (fixed-term or permanent contract, on a full or part-time basis, including employees on work-study contracts). In-terns, temporary staff, service providers, consultants and other external staff are not recorded in headcount.

Headcount is recorded as the individuals who are physically present at the end of the period, and not on a full time equivalent (FTE) basis.


Employees whose contracts expired in the evening of 31 December 2014 are recorded in the headcount present as at 31 December 2014.

2. Absenteeism

Absenteeism refers to employees who have missed one or several working days in part or in full as a result of:

- parental leave,- an industrial accident,- other reasons (excluding illness, leave and industrial acci-

dents).

These absences may be avoidable or unavoidable. The num-ber of days’ absence is counted in working days. In the case of subsidiaries where the number of days’ absence was reported in calendar days, the business day calculation was performed by using a ratio of 5/7 (estimate).

3. Hiring

Hires on fixed-term contracts concern individuals who accepted a fixed-term contract during the period.

These individuals may be:

- external applicants who have accepted a fixed-term contract (“hire”);

- temporary staff who have accepted a fixed-term contract (“hire”);

- individuals on fixed-term contracts who have agreed to a re-newal of their fixed-term contract (“re-hire”).

Permanent contract hires concern individuals who have ac-cepted a permanent contract during the period.

These individuals may be:

- external applicants who have accepted a permanent contract (“hire”);

- temporary staff who have accepted a permanent contract (“hire”);

- individuals on fixed-term contracts who have accepted a per-manent contract (“re-hire”).

4. Lay-offs

Lay-offs concern individuals working for the Company on permanent or fixed-term contracts where the employer took the initiative to terminate the employment contract.

Contractual terminations and fixed-term contracts that reach their expiry date are not included under lay-offs.

5. Industrial accidents

Number of accidents recorded over the year (inclu-ding travel accidents between home and work). A relapse resulting from an accident that was already recorded (in

Year N or earlier) must not be recorded for a second time. Likewise, an accident reported in Year N-1 that continues to result in days of absence in Year N must not be recorded (as it was already recorded in the previous financial year).

Lastly, any accidents reported over the year are counted, even before they are formally recognised by the social security organi-sation (or an equivalent body).

In the event that their recognition is rejected, these ac-cidents are removed if the refusal is received prior to the close of the data reporting period.

The following formulas have been applied in order to calcu-late frequency and severity rates:

- FR = number of accidents with recognised lost time during the year x 1,000,000 / actual hours worked;

- SR = aggregate number of days of absence due to industrial accidents x 1,000 / actual hours worked.

6. Water consumption

The consumption of water used in the production pro-cess and cooling systems has been included in this indica-tor. It is worth noting that we did not distinguish between production process water consumption and cooling pro-cess water consumption in the 2014 report.

7. Energy

This definition includes direct or primary sources of en-ergy (e.g. gas) and indirect or processed energy (e.g. elec-tricity consumption).

The energy used to propel industrial vehicles (e.g. forklifts) is included.

The fuel consumption of commercial and company vehicles is not included.

Likewise, water and energy consumption is not published when it is included in building rental charges.

Energy consumption is quantified for the production facilities included in the 2014 CSR report.


3.1.13 Appendices - Key indicators

appendiCeS: Key indiCatorS

Headcount Unit 2014 CSR scope

Total year-end headcount Number 2

Total hires Number 773

Total leavers Number 568

of which lay-offs Number 222

Remuneration and change in remuneration Unit 2014 CSR scope

Payroll as at 31/12/2013 Keuros 36,994.372

Payroll as at 31/12/2014 Keuros 37,206.050

Change % +0.57%

Organisation of working hours Unit 2014 CSR scope

Total theoretical hours worked Hours 3,513,678.36

Total overtime (paid and unpaid) Hours 48,488.00

Total actual hours worked Hours 3,219,226.82

Aggregate number of days of absence Business days 43,483.30Number of accidents with lost time recorded over the year

Number 41

Number of accidents without lost time recorded over the year

Number 7

Number of occupational illnesses recorded over the year

Number 0

Industrial accident severity rate Number 0.38

Industrial accident frequency rate Number 12.74

Number of training hours followed Hours 10,327.15

Other employment indicators Unit 2014 CSR scope

Disabled persons employed Number 41Number of collective agreements signed during the year

Number 4

Number of agreements relating to safety and/or health in the workplace signed during the year

Number 4

Raw material consumption Unit 2014 CSR scope

Water consumption m3 523,604.38

Raw material: neutral alcohol litres 11,172,637.00

Raw material: rye tonnes 10,441.40

Raw material: wine m3 3,977,776.00

Raw material: sugar tonnes 4,741.91

Energy consumption Unit 2014 CSR scope

Electricity kWh 12,311,030.00

Heating oil m3 193.56

Natural gas kWh 48,176,518.00

Liquefied natural gas m3 1,729.85

Propane m3 5,721.99

Diesel m3 234.71

Non-transport diesel m3 14.99

Other environmental indicators Unit 2014 CSR scope

Provisions for environmental risk Keuros 0.00

Guarantees for environmental risk Keuros 425.23


3.2 Independant third-party report on consolidated so-cial, environmental and so-cietal information published in the management report

This is a free translation into English of the original report issued in French, and is provided solely for the convenience of English speaking readers. This report should be read in conjunc-tion with, and is construed in accordance with French law and professional auditing standards applicable in FranceFinancial year ended 31 December 2014

Financial year ended December 31, 2014

To the Shareholders,

As independent third-party, members of Mazars’ network, sta-tutory auditor of Belvédère SA, whose accreditation was accep-ted by COFRAC under the number 3-1058 1, we hereby present you our report on the consolidated social, environmental and so-cietal information provided in the management report prepared for the year ended December 31, 2014, (hereinafter referred to as “CSR Information”), pursuant to Article L.225-102-1 of the French Commercial Code (Code de Commerce).

Responsibility of the company

The Board of Directors of Belvédère SA is responsible for preparing a management report including the CSR Information required under Article R. 225-105-1 of the French Commercial Code, in accordance with the repor-ting criteria of the company (hereafter the “Reporting Criteria”), a summary of which is provided in the Mana-gement Report and available on request of the society headquarter.

Independance and quality control

Our independence is defined by regulatory texts, the profession’s Code of Ethics and by the provisions of Article L. 822-11 of the French Commercial Code. Furthermore, we have set up a quality control system that includes docu-mented policies and procedures designed to ensure com-pliance with deontological rules, professional standards and applicable legal texts and regulations.

Responsibility of the Independant Third-Party Body

Based on our work, our role is to:

- attest that the required CSR Information is disclosed in the management report or, that an explanation has been provided if any information has been omitted, in accordance with the third

paragraph of Article R. 225-105 of the French Commercial Code (Attestation of completeness of the CSR Information);

- provide limited assurance that, on the whole, the CSR Information is fairly presented, in all material respects, in accordance with the adopted Reporting Criteria (Fairness report regarding CSR Information).

Our work was carried out by a team of 7 people between Fe-bruary 2014 and May 2015 for a period of about 6 weeks.

We conducted the work described below in accordance with the professional standards applicable in France and the legal or-der dated May 13, 2013 determining the methodology according to which the independent third party body conducts its mission and, on the reasoned opinion, in accordance with ISAE 3000 2.

1. Attestation of completeness of the CSR Infor-mation

We got acquainted with the direction that the Group is taking, in terms of sustainability, with regard to the so-cial and environmental, consequences of the company’s business and its societal commitments and, where appro-priate, the actions or programs that stemmed from it.

We compared the CSR Information presented in the mana-gement report to the list set forth in Article R. 225-105-1 of the French Commercial Code.

In the event of omission of some consolidated information, we checked that explanations were provided in accordance with the third paragraph of the article R. 225-105 of the French Com-mercial Code.

We checked that the CSR Information covers the consolidated scope, which includes the company and its subsidiaries within the meaning of Article L. 233-1 of the French Commercial Code (Code de commerce) and the companies that it controls within the meaning of Article L. 233-3 of the French Commercial Code (Code de commerce), subject to the limits set forth in the metho-dological note set out in section 5.1.6 “Scope of the report” of the Management Report.

Based on our work, and taking into account the limitations mentioned above, we attest that the required CSR Information has been disclosed in the management report.

2. Fairness report with respect to CSR Informa-tion

N AT U R E A N D S CO P E O F P R O C E D U R E S

We conducted about ten interviews with the persons responsible for the preparation of CSR Information from the departments in charge of the process of gathering in-formation and, when applicable, the persons responsible for internal control and risk management procedures, to:

- assess the appropriateness of the Reporting Criteria in terms of relevance, completeness, neutrality, clarity and reliability, by taking into consideration, when relevant, the sector’s best prac-


tices;

- verify the set-up within the Group of a process to collect, compile, process and check the CSR Information with regard to its completeness and consistency. We familiarized ourselves with the internal control and risk management procedures relating to the compilation of the CSR Information.

We determined the nature and extent of tests and controls depending on the nature and importance of CSR Information in relation to the characteristics of the Company, the social and en-vironmental issues of its operations, its strategic priorities in rela-tion to sustainable development, and the Industry best practices.

Concerning the CSR information that we considered to be the most significant 3:

- at the level of the consolidating entity and of the entities, we consulted source documents and conducted interviews to corroborate the qualitative information (organization, policies, actions); we implemented analytical procedures on the quanti-tative and verified, on the basis of sampling techniques, the cal-culations and consolidation of the information; and we verified its consistency with the other information contained in the ma-nagement report;

- at the level of a representative sample of entities 4, selected based on their activity, their contribution to consolidated indica-tors, their location and a risk analysis; we conducted interviews to verify the proper application of procedures and conducted substantive tests, using sampling basis, to verify the calculations performed, and reconciled data with supporting evidence.

The selected sites contribution to group data equals to 30 % of headcount and from 63 % to 84 % of the quantitative environ-mental information tested.

Regarding the other consolidated CSR Information, we as-sessed its fairness and consistency based on our knowledge of the Group.

Finally, we assessed the relevance of the explanations relating to, where necessary, the total or partial omission of certain infor-mation.

We deem that the sampling methods and sample sizes we have learned by exercising our professional judgment allow us to formulate a conclusion providing limited assurance; a higher level of assurance would have required more extensive work. Be-cause of the use of sampling techniques, and because of other limits inherent to any information and internal control systems, the risk of not detecting a material misstatement in the CSR In-formation cannot be completely eliminated.

Conclusion

Based on our work, we did not identify any material misstatements that would lead us to believe that the CSR

Information, taken as a whole, has not been fairly pre-sented, in all material respects, in accordance with the Re-porting Criteria.

Paris La Défense, 20th May 2015

The Independent Third Party

Mazars SAS

Dominique Muller Romain Maudry Partner Partner

Emmanuelle RigaudiasPartnerCSR & Sustainable Development

Note 1: Whose scope is available on the website www.cofrac.fr

Note 2: ISAE 3000 – Assurance engagements other than audits or reviews of

historical financial information

Note 3: Total headcount at the end of the period and breakdown by age, gen-

der and geographical region; Joiners and leavers including redundancies; Number

of lost-time accidents recorded over the year; Number of training course hours

followed; Energy consumption; Water consumption.

Note 4: Marie Brizard ; Destylarnia Sobieski ; Moncigale


4.1 2014 consolidated state-ments and notes

2014 CONSOLIDATED STATEMENTS

4


The income statements for the financial years ended 31 December 2012 and 31 December 2013 have been restated to include the presentation changes set out in Note 12 – Accounting Rules and Policies.

ConSolidated inCome Statement

€000 unless stated otherwise Note 2014 2013restated

2012restated

Revenues 3 716 529 856 864 891 900Excise duties (249 851) (317 298) (340 636)Revenues excluding excise duties 3 466 678 539 566 551 264Purchases consumed (319 632) (371 657) (382 383)External charges 4.1 (74 298) (82 455) (88 479)Personnel costs 4.2 (57 937) (63 903) (65 961)Taxes and levies (8 123) (8 895) (8 734)Depreciation charges (7 382) (8 461) (9 818)Other operating income 4.3 14 744 11 558 9 225Other operating expenses 4.3 (13 010) (15 473) (14 162)Underlying operating profit/(loss) 1 042 279 (9 048)Non-recurring operating income 4.4 8 412 32 436 8 023Non-recurring operating expenses 4.4 (23 368) (68 453) (83 951)Operating profit/(loss) (13 914) (35 737) (84 976)Income from cash and cash equivalents 4.5 249 165 438Gross cost of borrowings 4.5 (1 579) (7 762) (21 887)Net cost of borrowings (1 330) (7 597) (21 449)Other financial income 4.5 6 811 244 640 8 294Other financial expenses 4.5 (9 705) (10 873) (11 406)Net financial income/(expenses) (4 224) 226 170 (24 562)Profit/(loss) before tax (18 138) 190 432 (109 537)Income tax (charge)/income 4.6 (60) (272) (9 231)Share of earnings of associates 307 211Net profit/(loss) from continuing operations (18 198) 190 467 (118 558)Profit/(loss) from discontinued operations, net of taxNet profit/(loss) (18 198) 190 467 (118 558)Group share (19 096) 190 260 (117 792) of which net profit/(loss) from continuing operations (19 096) 190 260 (117 792) of which net profit/(loss) from discontinued operationsMinority interests 897 207 (766) of which net profit/(loss) from continuing operations 897 207 (766) of which net profit/(loss) from discontinued operations

Net earnings per share from continuing operations, Group share (€)

4.7 -0,72 € 9,97 € -39,31 €

Diluted net earnings per share from continuing operations, Group share (€)

4.7 -0,72 € 7,60 € -39,31 €

Net earnings per share, Group share (€) 4.7 -0,72 € 9,97 € -39,31 €Diluted net earnings per share, Group share (€) 4.7 -0,72 € 7,60 € -39,31 €

Weighted average number of shares outstanding 26 479 328 19 077 206 2 996 118

Diluted weighted average number of shares outstanding 32 429 232 25 027 382 2 996 118


The comprehensive income/(loss) amounts are shown net of tax.

No material amount was reclassified to income for the period.

ComprehenSive inCome Statement

(€000) 2014 2013 2012

Net profit/(loss) (18 198) 190 467 (118 558)Items that may be reclassified to P/L (3 679) (778) 3 742Translation differences (3 679) (778) 3 805Other items (63)Items not reclassified to P/L (314) 294Actuarial differences according to IAS 19 revised (517) 294Valuation of financial instruments 203

Comprehensive income/(loss) (22 191) 189 983 (114 816)Group share (22 985) 189 837 (114 437)Minority interests 793 146 (379)


ConSolidated balanCe Sheet

(€000) Note 31 December 2014

31 December 2013

31 December 2012

ASSETSGoodwill 5.1 29 932 30 646 30 768Intangible assets 5.2 110 900 111 240 131 734Property, plant and equipment 5.3 42 922 51 653 79 475Financial assets 5.4 1 624 5 767 9 002Investments in associates 3 089 2 883Non-current tax receivables 27 723Deferred tax assets 4.6 3 393 2 497 4 373Non-current assets 188 771 204 892 285 957Inventory and work-in-progress 5.5 70 095 100 196 89 600Trade receivables 5.6 98 982 134 355 135 228Tax receivables 33 164 31 275 74Other current assets 5.7 21 373 25 869 27 138Cash and cash equivalents 5.8 77 184 36 470 28 175Current assets 300 797 328 167 280 214Assets held for sale 2.0 5 877Total assets 495 445 533 059 566 172

(€000) Note 31 December 2014

31 December 2013

31 December 2012

LIABILITIESShare capital 6.1 52 973 52 972 6 811Premiums 416 359 416 353 138 000Consolidated reserves (244 204) (434 138) (320 571)Translation reserves (17 545) (13 968) (13 251)Consolidated net profit/(loss) (19 096) 190 260 (117 792)Equity capital (Group share) 188 488 211 479 (306 803)Minority interests 10 696 9 906 7 801Total equity capital 199 184 221 385 (299 002)Employee benefits 6.2 6 071 5 132 5 510Other non-current provisions 6.3 7 473 7 072 9 654Long-term borrowings – due in more than one year 6.4 2 202 2 353 3 375Deferred tax liabilities 4.6 38 768 40 731 40 880Other non-current liabilities 6.6 64 227 74 346 3 170Non-current liabilities 118 740 129 634 62 589Current provisions 6.3 3 972 3 523 12 082Long-term borrowings – due in less than one year 6.4 1 112 1 480 540 198Short-term borrowings 6.4 32 321 13 510 23 818Trade and other payables 56 985 64 310 110 551Tax liabilities 558 (946) 20 757Other current liabilities 6.6 77 813 100 162 95 178Current liabilities 172 761 182 040 802 585Liabilities held for sale 2.0 4 760Total liabilities 495 445 533 059 566 172


Statement of CaSh flowS

(€000) 2014 2013 2012

Total consolidated net profit/(loss) (18 198) 190 467 (118 558)Less net profit/(loss) from sold or held-for-sale operationsNet profit/(loss) on continuing operations (18 198) 190 467 (118 558)Income/(loss) from equity associates (307) (211)Depreciation, amortisation and provisions 12 375 20 017 86 658Fair value revaluation gains/losses (11) (383)Impact of discounting 6 021 (30 420) (564)Difference between the fair value/cash obtained on the transfer of shares 5 861Difference between the fair value and book value of the FRN debt (11) (209 803)Gains/(losses) on disposals and dilution 238 1 780 (905)Dividend income (5)FRN and OBSAR debt deposit adjustments 1 085Operating cash flow after net cost of borrowings and tax 413 (21 325) (33 963)Income tax charge (credit) 60 272 9 232Net cost of borrowings 1 335 7 630 21 720Operating cash flow before net cost of borrowings and tax 1 808 (13 423) (3 011) Change in working capital 1 (inventories, trade receivables/payables) 58 149 (55 964) 35 477Change in working capital 2 (other items) (37 045) 83 055 (14 448)Taxes (2 346) (387) (2 783)Cash flows from operating activities 20 566 13 281 15 235 Purchase of minority interests (225)Purchase of PP&E and intangible assets (4 844) (4 418) (3 870)Subsidies received 526Purchase of financial assetsIncrease in loans and advances granted (255) (4 473) (831)Decrease in loans and advances granted 4 424 973 806Disposal of PP&E and intangible assets 474 21 063 1 508Disposal of financial assets (4)Other investment and disposal flows 107Dividends received 106 51Impact of change in consolidation scope 3 500Cash flow from investment activities 3 295 13 357 (2 035) Capital increase 7 73 1 648Purchase of treasury sharesSale of treasury shares 2 366Borrowings received 1 358 810 1 016Borrowings repaid (1 596) (6 853) (2 483)Net interest paid (1 454) (5 083) (2 592)Deposit in escrow of first instalment of the Safeguard Plan (FRNs and OBSAR bonds) 2 591Net change in short-term debt 19 058 (10 194) (17 291)Cash flow from financing activities 17 373 (18 656) (17 336) Impact of fluctuations in exchange rates (282) (993) 1 820Cash flows from operations sold and sale proceedsChange in cash and cash equivalents 40 951 6 990 (2 316) Opening cash and cash equivalents 36 470 28 175 30 492Cash reclassifications* (5) 1 306Cash from held-for-sale operations (231)Closing cash and cash equivalents 77 186 36 470 28 175Change in cash and cash equivalents 40 951 6 990 (2 316)

* In 2013, the cash and cash equivalents reclassification corresponds to a bank account previously blocked and released.


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4


CONTENTS – NOTES TO THE FINANCIAL STATEMENTS

Note 1 General information: Highlights, accounting rules and principles, changes in consolidation scope

Note 1.1 Highlights Note 1.2 Accounting rules and policies

Note 2. Change in consolidation scope Note 3. Segment information Note 4. Notes to the income statement

Note 4.1 External expenses Note 4.2 Personnel costs Note 4.3 Other operating income and expenses Note 4.4 Non-recurring operating income and expenses Note 4.5 Net financial income Note 4.6 Income tax Note 4.7 Earnings per share

Note 5. Notes on consolidated assets

Note 5.1 Goodwill Note 5.2 Trademarks and other intangible assets Note 5.3 Property, plant and equipment Note 5.4 Financial investments Note 5.5 Inventory Note 5.5 Trade and other receivables Note 5.6 Other current assets Note 5.7 Cash and cash equivalents

Note 6. Notes on consolidated liabilities and equity capital

Note 6.1 Composition of the share capital and dilutive instruments Note 6.2 Employee benefits Note 6.3 Provisions Note 6.4 Borrowings Note 6.5 Financial instruments and financial risk factors Note 6.6 Other liabilities

Note 7. Additional information

Note 7.1 Assets pledged as security and off-balance sheet commitments Note 7.2 Disputes and contingent liabilities Note 7.3 Consolidation scope at 31 December 2014 Note 7.4 Related parties Note 7.5 Statutory Auditors’ fees Note 7.6 Post-balance sheet events


Note 1. General information: Highlights, accounting rules and principles, changes in consolidation scope

Belvédère is a société anonyme (French public limited company) with a Board of Directors incorporated under French law and specifically subject to the provisions of the French Commercial Code. Belvédère shares are listed on Euronext Paris (Compartment B) and the Warsaw Stock Exchange (WSE).

The Belvédère Group operates in the wines and spirits sector.

The Group has been the subject of a rehabilitation plan since the Court decision issued on 9 April 2013.

The company’s registered office is at 7 quai de la Paix, Beaucaire (30300).

These financial statements were approved by the Board of Directors on 12 May 2015.

Note 1.1 Highlights

B AC K I N T H E G A M E 2018 S T R AT E G I C P L A N Buoyed by a renewed governance system, a healthier

financial position and powerful brands with a strong mul-ti-national presence, the Group’s priorities in 2014 were to form a management team and promote an integrated and calibrated operating system in order to determine and successfully execute the 2018 BIG strategic plan over the coming years.

The Belvédère Group has set down its goals in the 2018 “Back in the Game” (BIG) strategic plan. This plan, which was presented to investors in December 2014, is based on three operational aspects and is aimed at making the Group a core challenger in the market.

1) Divestment of non-strategic and loss-making assets

Belvédère aims to sell off non-strategic and loss-genera-ting assets within the timeframe of its strategic plan. These are primarily wholesale activities in Poland, superfluous production equipment in Poland and property assets in Poland and France.

2) Streamlining of core businesses via f ive priority programmes

- Modernising industrial facilities;- Reducing direct purchasing costs;- Improving the distribution model;- Simplifying operations;- Developing key skills.

3) Growing revenues

To roll out its growth strategy, Belvédère will rely on:

- The four strategic cornerstones represented by Vodka, William Peel, Marie Brizard, and Fruits and Wine;

- Six key growth markets: France, Poland, United States, Spain, Lithuania and Brazil.

These three programmes should enable the Group to achieve an EBITDA margin of between 12 and 15% within the plan timeframe.

W O R K P E R F O R M E D O N S T R E N G T H E N I N G T H E O R G A N I S AT I O N A L S T R U C T U R E A N D O P E R AT I O N O F T H E ACCO U N T I N G A N D F I N A N C I A L P R O C E D U R E S F O R M I N G PA R T O F T H E CO N T R O L S Y S T E M

In keeping with the change in the governance process made in 2013:

- Separation of the roles of Chairman of the Board of Directors and Chief Executive Officer;

- Appointment of independent directors;- Creation of an Appointments Committee on 30 Sep-

tember 2013;- Creation of a Remuneration Committee on 30 October

2013;- Creation of an Audit Committee on 11 October 2013.

The Belvédère Group redefined the organisational struc-ture of its holding company and of all Group entities in 2014.

1) A strengthened senior management team

The Group’s senior management team was strengthened following the arrival of Jean-Noel Reynaud via the ap-pointment of a Marketing Director, Purchasing Director and Industrial Director.

The Group’s senior management team recorded the ar-rival of a Director of Human Resources and a General Se-cretary in 2015.

Accordingly, the Belvédère Group has set up an Exe-cutive Committee responsible for implementing the 2018 BIG strategic plan and for monitoring what are considered to be the key areas of improvement:

- Continuing to optimise working capital; - Implementing a consistent and proactive sales policy

based on Category Management; - Reviewing the marketing positioning of the Group’s

brands;- Generating significant synergies aimed at maximising

efficiency and operating responsiveness while reducing the cost structure; Implementing industrial best practices and pooling the Group’s purchases will be the first drivers for this area of improvement;


- Pooling know-how and expertise.

2) A strengthened Finance Department

Belvédère SA has given the Group Finance Department the resources required to handle the preparation and as-sessment of the financial statements, to control the subsi-diaries, to perform the management control process and to process complex transactions.

The two priority measures aimed at strengthening the internal control process involved the introduction of:

- An appropriate organisational structure; - Tools for monitoring operating performance.

Accordingly, the Group Finance Department has added to its teams by:

- Strengthening the consolidation unit;- Appointing a Group Management Controller;- Appointing a Group Treasurer;- Appointing a Deputy Finance Director.

3) Strengthening the internal control process

During the 2014 financial year, the Group clearly de-termined the operating rules to be applied at each entity. These rules specifically concern:

- Delegations of authority: determining commitment au-thorisation and delegation of authority thresholds depen-ding on the management levels;

- The performance of a comprehensive review, by each subsidiary, of commitments given and received;

- The performance of a comprehensive review of legal risk by each subsidiary.

Belvédère’s senior management ensured that these ope-rating rules were formally set down and correctly applied at each subsidiary throughout the year.

In addition, the Group paid particular attention to all the factors relating to cash management during the finan-cial year. Accordingly, each entity performed the following tasks at senior management’s request:

- Drawing up weekly cash position forecasts over a pe-riod of 13 weeks;

- Reviewing the bank accounts opened in the subsi-diaries’ name and, where applicable, streamlining rela-tionships with banks;

- Applying the working capital management rules deter-mined and monitored by the Group’s Cash Management Department.

4) Introducing reporting tools

In line with the implementation of the internal controls described above, the Group Finance Department intro-duced various monthly and weekly business reports de-signed to help senior management steer the operating activities. The main business reports cover the following topics:

- Weekly 13-week cash position forecasts;- Monitoring the monthly operating performance;

- Identifying legal risk at each entity;- Identifying the contractual and off-balance sheet com-

mitments made at each entity; - Identifying delegations of authority.

This information, which is prepared for each entity, is presented to the members of the Executive Committee on a monthly basis. The Group then consolidates this data, in order to obtain a consolidated overview of the Group’s results with regard to cash position, earnings, risks and commitments.

5) Internal Audit assignments

Senior management relied on the Internal Audit Depart-ment, which was set up in December 2013, with regard to internal control issues and the performance of investiga-tion assignments.

The priority issues addressed by Internal Audit in 2014 were:

- Determining Group policies and monitoring their ap-plication at the subsidiaries;

- Determining the Group reporting process;- Performing specific audits at the request of senior ma-

nagement;- Identifying best practices to apply within the Group;- Identifying business risk;- Monitoring the action plans aimed at strengthening

the internal control process within the Group.

6) Other

Throughout 2014, Group senior management worked on raising awareness of the importance of internal control amongst the subsidiary management teams (meetings with the Managing Directors, internal control questionnaires, inclusion of the internal control process in performance measurement).

The intra-Group cash flows within Belvédère’s entities were documented at the Finance Department’s initiative. The twofold goal was the controlling and optimisation of cash flows (simplification, financial optimisation, etc.).

N OT E 1 .2 ACCO U N T I N G R U L E S A N D P O L I C I E S

1. Accounting principles and policies applied

The consolidated financial statements of Belvédère S.A. and its subsidiaries (the Group) have been prepared in ac-cordance with IFRS (International Financial Reporting Standards) as adopted by the European Union and with IFRS compulsorily applicable as at 31 December 2014.

International accounting standards include IFRS, IAS (International Accounting Standards) and their interpre-tations.

The accounting principles and policies applied to the consolidated financial statements for the year ended 31 De-cember 2014 are identical to those applied to the consoli-


dated financial statements for the previous financial year, with the exception of IFRS and the corresponding SIC (Standards Interpretations Committee) and IFRIC (Inter-national Financial Reporting Interpretations Committee) interpretations, for which application is mandatory for fi-nancial years beginning on and after 1 January 2014 and which the Group has not applied in advance.

2. Presentation changes

As part of the standardisation of its accounting prac-tices, the Belvédère Group has changed the presentation of the following items in its financial statements:

- Revenues: the Group’s revenues are now presented net of any discounts and commercial benefits granted. This presentation change only concerns the US subsidiary, which recognised these costs in its external expenses.

- Excise duties: in accordance with the practices of other operators in the sector and to improve comparability, the Belvédère Group has added a line item to its income sta-tement showing revenues excluding excise duties on vo-lumes sold.

The Group retains in inventory the excise duties paid over the period for products not yet sold and therefore still included in inventory. These duties will be released from inventory when the products are sold over subsequent pe-riods.

This new presentation primarily affects the Polish and Lithuanian entities.

The Group also decided to establish a strict definition of ‘Non-recurring income and expenses’, which is set out in section 26 of the present Note.

These presentation changes, which have no impact on the Belvédère Group’s operating profit/(loss), are set out in section 29 of the present Note – Impact of the change in presentation.

3. New standards and amendments

The Belvédère Group has reviewed the new amend-ments, standards and interpretations that came into force on 1 January 2014.

Accordingly, the Group has applied the following stan-dards as of 1 January 2014:

- IFRS 10 – Consolidated Financial Statements (retros-pective application) supersedes IAS 27 – Consolidated and Separate Financial Statements, which now only covers se-parate financial statements, and SIC 12 – Consolidation – Special Purpose Entities.

IFRS 10 defines control as the basis for the consolida-tion scope, regardless of the percentage of the interest held in a company.

- IFRS 11 – Joint Arrangements (retrospective applica-tion) replaces IAS 31 – Interests in Joint Ventures, and SIC 13 – Jointly Controlled Entities.

A c c o r d i n g t o t h i s s t a n d a r d , t h e r e c o g n i t i o n o f partnerships must rely on the substance of the agreements and on an assessment of the resulting rights and obliga-tions. Joint arrangements are recognised in accordance with the percentage of assets, liabilities, income and ex-pense held by the joint party. Jointly controlled entities are henceforth only consolidated according to the equity me-thod required by IAS 28 – Investments in Associates and Joint Ventures, as correspondingly revised (elimination of the proportional consolidation method).

As the Group already applied the equity method to re-cognise its interests in jointly controlled entities, none of these changes has any impact on the financial statements presented.

- IFRS 12 – Disclosures of Interests in Other Entities, where an entity owns interests in subsidiaries, joint ven-tures, associates or structured non-consolidated entities.

The other standards where application became manda-tory in the European Union on 1 January 2014 have no im-pact on the Group’s financial statements. These standards include:

- Amendments to IFRS 10, IFRS 11 and IFRS 12 – Tran-sition guidance;

- Amendments to IFRS 10, IFRS 11 and IFRS 12 – In-vestment entities;

- Amendments to IAS 32 – Financial Instruments: Pre-sentation – Offsetting financial assets and financial liabi-lities;

- Amendments to IAS 36 – Recoverable Amount Disclo-sures for Non-Financial Assets;

- Amendments to IAS 39 – Novation of Derivatives and Continuation of Hedge Accounting.

Furthermore, Belvédère has not opted for early applica-tion of the following standards, which were adopted by the European Union on 31 December 2014 but come into force after the 2014 financial year:

- IFRIC 21 – Levies, the application of which is manda-tory for financial years beginning after 17 June 2014. This interpretation, which relates to the recognition of levies fal-ling within the scope of application of IAS 37 – Provisions, changes the triggering event used to recognise a liability relating to the payment of a levy or contribution. The trig-gering event for the recognition of the liability is now the date on which the levy falls due. This interpretation applies retrospectively and its impact would be non-material as at 1 January 2014.

Lastly, the standards and interpretations likely to apply to the Belvédère Group, which have been published by the IASB but have not yet been adopted by the European Union as at 31 December 2014, are as follows:

- IFRS 15 – Revenue from Contracts with Customers;- IFRS 9 – Financial Instruments (a standard intended

to gradually supersede IAS 39);- Amendments to IFRS 10 and IAS 28 – Sales or Contri-

butions of Assets between an Investor and its Associate/


Joint Venture;- Amendments to IAS 16 and IAS 38 – Clarification of

Acceptable Methods of Depreciation and Amortisation;- Amendments to IAS 16 and IAS 41 regarding Bearer

Plants;- Amendment to IFRS 11 – Accounting for Acquisitions

of Interests in Joint Operations;- Amendment to IAS 19 – Employee Contributions;- Amendment to IAS 27 – Equity Method in Separate

Financial Statements;- Annual improvements to IFRS, 2012-2014 cycle (publi-

shed in September 2014);- Annual improvements to IFRS, 2011-2013 cycle (publi-

shed in December 2013);- Annual improvements to IFRS, 2010-2012 cycle (publi-

shed in December 2013).The potential impact of the application of these new

standards and amendments on the financial statements is currently under review.

4. Measurement basis

The financial statements have been prepared according to the historical cost principle, with the exception of cer-tain asset and liability categories measured at fair value in accordance with the rules imposed by IFRS.

5. Use of estimates and assumptions

The preparation of IFRS consolidated financial state-ments requires management to make judgements and es-timates and to use assumptions that affect the accounting principles applied, as well as the valuation of assets, liabi-lities, income and expenses. Such estimates and assump-tions are based on experience and on a set of criteria that Management considers reasonable and realistic, without third parties necessarily being in a position to judge those estimates and assumptions. Actual results may differ from such estimates.

The underlying estimates and assumptions are reviewed on an ongoing basis. The impact of these reviews is re-corded in the accounting period in which the reviews took place or in future accounting periods, as applicable.

Information on the main judgements made when ap-plying the accounting principles, and on the main assump-tions relating to the use of estimates, is disclosed in the following notes:

Note 5.1: asset value testsNote 6.2: valuation of pension commitments Note 6.5: valuation of financial instruments

6. Consolidation method

Entities controlled directly or indirectly by Belvédère S.A. are fully consolidated. Control exists where Belvédère S.A. has the power to direct the entity’s relevant business activities either directly or indirectly, with a view to in-

fluencing its exposure or its rights to variable returns from its involvement with that entity. To assess control, existing and potential voting rights, which are currently valid or may be converted in the future, are taken into account.

The financial statements of controlled entities are conso-lidated from the date when control is obtained until the date when control ceases.

Full consolidation enables all the assets, liabilities and income statement items of the companies concerned, and the share in their income and equity capital attributable to Belvédère, to be taken into account, after eliminating intra-Group transactions and income.

All material transactions between consolidated compa-nies, together with any internal income within the consoli-dated entity (including dividends), are eliminated.

Companies over which the Group has a material in-fluence or exercises joint control, either directly or indirec-tly, are consolidated using the equity method.

7. Translation method

Translation of the financial statements of subsidiaries that use a functional currency other than the euro

The balance sheets of companies whose functional cur-rency is not the euro are converted into euros at the clo-sing exchange rate, while their income statements and cash flow statements are converted into euros at the average ex-change rate for the financial year. The resulting differences are entered under translation differences in equity capital until the investments to which they relate are disposed of or written off.

Goodwill and fair value adjustments arising from the acquisition of a foreign entity are considered as assets and liabilities of the foreign entity. They are denominated in the entity’s functional currency and are converted at the closing exchange rate.

Transactions denominated in foreign currencies

Transactions denominated in foreign currencies are converted at the exchange rates in effect on the transaction date. At the financial year-end, monetary assets and liabi-lities in foreign currencies shown on the balance sheet are converted at the closing exchange rate. The resulting diffe-rences are entered in the income statement, with the excep-tion of differences arising from transactions equivalent to net investment transactions, which are directly entered as translation differences in equity capital.

8. Presentation of current/non-current items

Belvédère presents the assets and l iabil it ies in its consolidated balance sheet in accordance with a current/


non-current classification.

An asset is considered as current if it is:- Used or sold as part of the normal operating cycle;- Held for transaction purposes over a period of less

than 12 months following the financial year-end;- A cash management asset whose use is not subject to

restrictions.

All other assets are classified as non-current.

A liability is considered as current if it is:- Settled as part of the normal operating cycle;- Settled within a period of 12 months following the fi-

nancial year-end.

All other liabilities are classified as non-current.

Deferred tax assets and l iabil it ies are classif ied as non-current.

9. Business combinations and goodwill

Business combinations are recognised under the acqui-sition method, pursuant to IFRS 3 revised. Identifiable as-sets, liabilities and contingent liabilities and non-control-ling interests in the acquired entity (minority interests) are recognised at their acquisition-date fair value after a maximum 12-month measurement period starting on the acquisition date.

The difference between 1) the sum of the fair value of the consideration transferred by the purchaser and the amount of the minority interests in the acquired entity and 2) the fair value of the identifiable assets and liabilities is recognised under goodwill. In the event that this difference is negative (badwill), it is recorded under income (profit) at the acquisition date.

The transaction expenses incurred by the Group as part of a business combination, such as business finders’ fees, legal fees, due diligence fees and other professional and advisory fees are expensed as they are incurred.

In transactions with minority shareholders, the diffe-rence between the price paid and the share of minority in-terests acquired is directly recorded in equity capital.

10. Trademarks and other intangible assets

Other intangible assets include trademarks, software, patents, software licensing agreements and long-term leasehold rights on land in Poland.

Trademarks are not amortised if their useful life can be considered as indefinite. Trademarks with a finite useful life in view of their positions on their respective markets and the valuation of their inherent operating risks are amortised over their estimated useful life, which is usually

15 years.

Long-term leasehold rights on land in Poland meet the criteria for recognising an intangible asset under IFRS and are amortised over the 99-year period of the long-term lease.

11. Property, plant and equipment

Land, buildings and plant are valued at their acquisition cost less accumulated depreciation and any impairment charges recorded.

Depreciation of property, plant and equipment is calcu-lated according to the straight-line method based on the component parts and their estimated useful lives.

The average depreciation periods applied are as follows:- buildings (administrative and commercial): 10-50 years- fixtures and fittings: 3-15 years- equipment and tools: 5-20 years- other fixed assets: 3-10 years

If the recoverable value of property, plant and equip-ment is lower than its net book value, its book value is written down accordingly.

Assets held under finance leases that substantially trans-fer the risks and rewards of ownership to the Group are re-cognised as fixed assets. These fixed assets are depreciated according to the straight-line method based on their esti-mated useful life, or the term of the lease if it is shorter. The corresponding liability is entered under liabilities.

12. Biological assets

IAS 41 provides for the recognition of biological assets and their production at fair value, subject to the possibility of obtaining a reliable price reference (e.g. based on an ac-tive market).

The Group’s vines (plantations), which are recorded as fixed assets, meet the definition of biological assets under IAS 41. Their fair value cannot be reliably measured sepa-rately from the value of the land. In fact, the plantations are physically linked to the land on which they grow and there is no separate market for these plantations. Conse-quently, the vines are measured at cost less depreciation and impairment charges, and no subsequent revaluation is performed.

13. Impairment of fixed assets

Fixed assets with an indefinite useful life are tested for impairment at least once a year, and more often if there is evidence of impairment. Fixed assets with a finite useful life are tested for impairment whenever there is evidence of impairment.


The test consists in comparing the recoverable value of an asset or cash generating unit (CGU) with its book va-lue.

The recoverable value of the CGU is the higher of the values determined in accordance with the following two methods:

- The value-in-use calculated by discounting the future cash flows generated by the asset tested or by the CGU to which it belongs;

- The fair value less selling costs obtained using the stock market comparables method, or else by reference to market values for comparable assets.

Value-in-use is determined on the basis of discounted future cash flows determined according to the 2018 BIG strategic plan. The translation of the strategic plan into cash flows was based on a certain number of key assump-tions and judgements aimed at determining the trend in the markets in which the Group operates. As a result, the actual cash flows may differ from the estimated forecast cash flows used in order to determine value-in-use. Dis-count and long-term growth rates derived from analyses of the sector in which the Group operates are applied in order to estimate value-in-use. The discount rates used are post-tax rates specific to each geographical region and applied to post-tax cash flows.

For the purposes of this test, fixed assets that cannot be tested individually are grouped into CGUs and the good-will is assigned to the various CGUs (or group of CGUs). CGUs are uniform groups of assets whose ongoing use generates cash inflows that are mostly independent of the cash inflows generated by other asset groups. From a prac-tical standpoint, the Belvédère Group’s CGUs correspond to the geographical regions identified in the 2018 BIG plan.

Where the recoverable value of a CGU is lower than its net book value, the corresponding impairment is assigned first to goodwill and is recognised in operating profit/(loss) on the Non-recurring operating expenses line.

Pursuant to IAS 36, the Group assesses the sensitivity of the values resulting from impairment tests on the CGUs to which material amounts of goodwill and/or intangible assets with an indefinite useful life are attached, in relation to the key assumptions used in these tests (terminal year operating margin) and to the discount rates and long-term growth rates applied.

In the case of the assets tested, the assessment consists in (i) consecutively varying the key assumptions and rates selected and comparing the simulated recoverable values obtained with the book value, in order to calculate the potential impairment for each asset, and (ii) determining the amount above which the value of the key assumption would have to be adjusted in order for the recoverable va-lue to be equal to the book value.

Trademarks are considered as individual assets and are tested separately from other assets and separately from the CGUs. The test on trademarks is initially performed as part of the impairment tests (before the tests performed on the CGUs).

The recoverable value of a trademark is the higher of its net resale value and its value-in-use. Value-in-use is calcu-lated by discounting the future surplus cash flows gene-rated by the trademark.

An impairment charge is reversed, except in the case of goodwill, if the information underlying the recoverable value calculation changes (the increase in the book value of an asset due to the reversal of an impairment charge is limited to the book value after amortisation and deprecia-tion that would have been determined if no impairment charge had been recorded in the first place).

14. Financial instruments

Financial instruments include financial assets and liabi-lities.

Some financial instruments are valued at fair value. Fair value is defined as the amount for which an asset could be exchanged, or a liability settled, between knowledgeable and willing parties under normal market conditions. Listed prices on an active market represent the best indication of financial instruments’ fair value. In the absence of such listed prices, fair value is determined by applying reco-gnised valuation techniques based on “observable” market data.

Financial assets held for sale:

Equity investments in non-consolidated companies are classified in this category. These assets are recognised at their acquisition cost on the balance sheet when they are initially recognised. Changes in the fair value are re-cognised directly in equity capital except in the event of material or permanent impairment.

Financial derivatives:

The Group uses financial derivatives to hedge its cur-rency and interest rate risk. These financial instruments are initially recognised at their fair value, which usually corres-ponds to the transaction price, under other current assets or liabilities on the balance sheet, and are subsequently valued at their market value (fair value). Changes in fair value are entered in the income statement.

Some derivatives can be classified as fair value hedges (hedges against currency and interest rate risks), or as cash flow hedges (in the event of future purchases or sales).


Hedge accounting applies to these derivatives if the fol-lowing criteria are met:

- the hedging relationship is clearly defined and appro-priate documentation exists on the date when the transac-tion is arranged;

- the effectiveness of the hedge can be reliably demons-trated from the outset.

The accounting consequences of hedge accounting are as follows:

- Fair value hedgesThe hedge and the hedged item are valued at their fair

value. Changes in their fair value are symmetrically entered in the income statement. Where the hedge is effective, the change in the fair value of the hedging instrument offsets the opposite change in the fair value of the hedged item.

- Future cash flow hedgesThe hedging instrument is valued at fair value. The ef-

fective portion of the change in fair value is entered direct-ly in equity capital, while the ineffective portion is entered in the income statement.

The amounts recorded in equity capital are subsequently taken to the income statement when the hedged transac-tion is performed.

Loans and debt instruments:

Bank loans and debt instruments are initially measured at fair value less the transaction costs directly attributable to the transaction.

They are subsequently valued at their amortised cost using the effective interest rate method.

The effective interest rate is the rate used to accurately discount the future cash inflows and outflows over the spe-cified term of the financial instrument, or over a shorter period, where applicable, in order to obtain the net book value of the financial asset or liability.

Composite instruments:

Certain financial instruments contain both debt and equity components. The different components of these instruments are recognised under equity capital and debt instruments respectively, in accordance with IAS 32. Where the fair value of the composite instrument is broken down between its debt and equity components, the equity com-ponent is defined as the difference between the fair value of the overall composite instrument and the debt component. The debt component is calculated as the market value of a debt instrument that has similar characteristic features but does not include an equity component.

Loans and receivables:

Loans and receivables are financial assets other than de-

rivatives with fixed or determinable payments, which are not listed on an active market.

They include receivables related to equity investments, other loans and receivables granted to non-consolidated entities. These instruments are valued at fair value when first recognised, and then at amortised cost.

15. Trade receivables

Trade receivables are measured at fair value when they are initially recognised, and an impairment charge is re-corded when it appears that their recovery is uncertain. This impairment charge, which is determined on a case-by-case basis, is equal to the initial value of the receivable excluding tax and the estimated recoverable value.

Trade receivables not due that are assigned under a factoring agreement and that do not meet the IAS 39 de-consolidation criteria are retained under Trade and other receivables. A payable is recorded in consideration for the cash received.

16. Inventory

Inventory is valued at the lower of its actual cost price and its net realisable value. The cost price includes pur-chase costs, processing costs and other costs incurred to bring the inventory to its present location and condi-tion. The cost price is usually calculated according to the weighted average unit cost method.

17. Impairment of financial assets

A financial asset is impaired if there is objective evidence that one or several events have had a negative impact on the asset’s estimated future cash flows.

The impairment of a financial asset valued at amortised cost corresponds to the difference between its book value and the value of the estimated future cash flows discounted at the financial assets’ original effective interest rate.

A separate impairment test is carried out on each mate-rial financial asset. Other assets are tested in groups that display similar credit risk characteristics.

Impairment charges are recognised in the income sta-tement.

18. Cash and cash equivalents

Cash and cash equivalents include immediately avai-lable cash items: cash at bank, short-term deposits, units in UCITS that meet the definition of cash equivalents and short-term investments with a term of less than three mon-ths. All cash and cash equivalent components are valued at fair value through the income statement.


To the extent that they are considered as financing, bank overdrafts are not included in cash and cash equivalents.

19. Deferred taxes

In accordance with IAS 12, deferred tax is calculated for all temporary differences between the book values of assets and liabilities and their tax bases.

The tax rate used is the statutory tax rate in effect at the date when the temporary difference will reverse, i.e. usually the tax rate for the current financial year or the rate forecast for subsequent financial years, if it is known with certainty.

Deferred tax liabilities are automatically recognised, while deferred tax assets are only recognised if there is a reasonable chance that they will be realised in the short term.

20. Treasury shares

In accordance with IAS 32, treasury shares are deducted from consolidated equity capital at their acquisition cost. The income from the disposal of these shares is offset in the consolidated income statement.

21. Provisions

In accordance IAS 37, the Group records provisions as soon as present obligations (legal or constructive) arising from past events materialise, it is likely that outflows of re-sources representing economic benefits will be necessary to settle those obligations, and the amount of these outflows can be estimated on a reliable basis.

Provisions primarily include provisions for tax risks and for employee and commercial disputes.

Where the time value is material, the amount of the pro-vision is calculated by discounting expected future cash flows at the pre-tax discount rate reflecting the market’s current assessment of the time value of money and, where appropriate, the specific risk of the liability. The effects relating to the unwinding of the discount are recorded in financial expense.

22. Investment subsidy

The option chosen to present investment subsidies is their recognition under deferred income, as authorised by IAS 20.

The subsidy is transferred to income over the useful life of the asset to which it is attached.

23. Employee benefits

The Group contributes to pension and retirement be-nefit schemes in accordance with the laws and practices in each country where it operates.

In the case of basic and other defined contribution sche-mes, the Group expenses the contributions payable as they fall due and no provision is recorded, since the Group has no commitments in addition to the contributions paid.

In the case of defined benefit schemes, these commit-ments are covered either by dedicated insurance funds or by provisions on the balance sheet, and are determined on the basis of actuarial valuation using the projected unit credit method, in accordance with IAS 19 revised, while factoring in staff turnover rates, mortality rates and the fo-reseeable trend in remuneration. The discount rate used is determined by the actuaries in their annual report.

The fair value of the plan assets is deducted from the provisions on the balance sheet.

The income and expense recorded in connection with defined benefit schemes primarily corresponds to:

- The cost of services rendered during the financial year and of past services recognised in operating income;

- The unwinding of the discount for the discounted va-lue of the commitments, net of the expected return from the plan assets, which is recognised in financial income.

Actuarial differences are recognised in items of other comprehensive income.

Actuarial provisions are also recorded for a certain num-ber of benefits, such as long-service awards and anniversa-ry bonuses in various countries.

24. Discontinued operations

In accordance with IFRS 5 – Non-Current Assets Held for Sale and Discontinued Operations, assets and liabilities held for sale are presented separately on the balance sheet at a value that represents the lower of their book value and their fair value less selling costs. These assets are no lon-ger depreciated. An asset is considered as held for sale if recovery of its book value is mainly dependent on a sale transaction rather than on continual use. The asset must be available for immediate sale and its sale must be highly li-kely. The balance sheet items relating to discontinued ope-rations are presented on specific lines in the consolidated annual financial statements. Income statement items rela-ting to these held-for-sale or discontinued operations are separated out in the financial statements for all the periods shown, if they are of a material nature for the Group.

25. Revenue recognition

Revenues arising from the sale of products are reco-gnised net of any discounts and commercial benefits granted and net of sales taxes, if the risks and rewards of ownership have been transferred to the customer or if the service has been provided.

Pursuant to IAS 18, some marketing costs, such as joint advertising campaigns with distributors, the cost of listing new products or point-of-sale promotional and advertising initiatives are deducted from revenues, if there is no dis-


tinct service where the fair value can be reliably measured.

The presentation of Group revenues was changed over the period via the addition of the new line item showing revenues excluding excise duties paid by the Group on products sold over the period.

Excise duties paid by the Group in respect of products included in Group inventory at the year-end date are re-tained in inventory.

The impact of this restatement on the Group’s income statement is explained in section 29 below.

26. Underlying operating profit/(loss)

Underlying operating profit/(loss) is generated by the operations in which the Company is involved as part of its business affairs, as well as by the related activities that it performs on ancillary basis as an extension of its normal business activities.

Non-recurring operating income and expenses are ex-cluded from underlying operating profit/(loss) where they are the result of unusual events or transactions.

Accordingly, the following items are considered as non-recurring:

- Gains or losses on asset disposals;- Impairment of goodwill and fixed assets;- Restructuring expenses;- Items relating to the Group’s financial restructuring.

27. Net financial income

Net financial income includes the gross cost of debt, in-come from cash and cash equivalents, other financial inco-me and expenses, and changes in the fair value recorded for debt instruments.

All interest expenses are recorded in the year when they are incurred.

28. Earnings per share

Earnings per share are calculated by dividing net pro-fit, Group share, by the average number of shares outstan-ding during the financial year, after deduction of treasury shares.

Diluted earnings per share are calculated by taking into account the impact of dilutive factors on the average num-ber of shares outstanding (treasury warrants, or “BSAR”, are excluded from the calculation basis).

29. Impact of the presentation change

The presentation changes made by the Group over the financial year break down as follows:

€000 unless stated otherwise 2013published Reclassification

of excise duties

Commercial discounts and benefits US

2013restated

Gross revenues 859 911 (3 047) 856 864Excise duties (317 298) (317 298)Revenues excluding excise duties 859 911 539 566Purchases consumed (360 186) (11 471) (371 657)External charges (85 502) 3 047 (82 455)Personnel costs (63 903) (63 903)Taxes and levies (337 665) 328 770 (8 895)Depreciation charges (8 461) (8 461)Other operating income 11 558 11 558Other operating expenses (15 473) (15 473)Underlying operating profit/(loss) 279 279Non-recurring operating income 32 436 32 436Non-recurring operating expenses (68 453) (68 453)Operating profit/(loss) (35 737) (35 737)


Note 2. Change in consolidation scope

In 2014

As part of the measures aimed at streamlining the Polish organisational structure, Hasis, TMT Centrum, Rokicki, Wawrz yniak I I , HZ, Tr itex, Redo, Milt ihur t and MAAK were merged with Sobieski Trade during the year.

In France, Distilleries Françaises merged with Marie Bri-zard as at 31 December 2014, while the Group’s interest in CI Nolet & Co was sold for a transaction value of €3.5 million.

The three Ukrainian companies, Belvédère Ukraina, Ita-liano Ukrainian and Boisson Elite, were deconsolidated. These companies, which have seen their business volumes shrink considerably, and whose outlook is doubtful, are the subject of liquidation proceedings announced on 22 January 2014. As the Group has lost control over these en-tities, they were deconsolidated at the beginning of 2014. To hedge its exposure to Ukraine, the Group has written off all its receivables against these entities, which amount to €4.3 million.

In 2013

There was no change in the consolidation scope during the 2013 financial year.

Please note the change in the percentage interest held in the Bulgarian subsidiaries between 31 December 2012 and 31 December 2013.

In 2012

One company was founded in Latvia in May 2012, Bel-

vedere Distribution SIA Latvia, a wholly owned subsidiary of the Lithuanian company Belvedere Prekyba. This com-pany had no significant business activities in the 1st half of 2012.

In July 2012, a Belarus company named Galiart Group was founded via a contribution of assets from Galiart, another Belarus company. The former company is wholly owned by the latter. Galiart Group is intended to act as the holding company for certain Group property assets in Belarus, and has no business activities.

Discontinued operations

In its strategic plan, the Group announced its desire to sell non-strategic assets and assets that generate operating losses. These are primarily wholesale activities in Poland, superfluous production equipment in Poland and property assets in Poland and France.

As at 31 December 2014, Belvédère’s Management re-viewed the progress of the sale process for each asset iden-tified according to the following criteria:

- Availability of the asset;- Sale plan initiated by the management team;- Programme in place for finding a buyer;- Likelihood of a sale within a period of less than one

year.

The Belvédère Management believes that three assets meet the above criteria: Galerie Alkoholi, the Polish com-pany, for which the last conditions precedent to the sale have been lifted, Galiart, the Belarus company, which was sold in February 2015, and the Fondaudège facility in France.

As a reminder, the Group must obtain the agreement of the judge responsible for the execution of the plan in the

€000 unless stated otherwise 2012published Reclassification

of excise duties

Commercial discounts and benefits US

2012restated

Gross revenues 894 935 (3 035) 891 900Excise duties (340 636) (340 636)Revenues excluding excise duties 894 935 551 264Purchases consumed (381 889) (494) (382 383)External charges (91 515) 3 035 (88 479)Personnel costs (65 961) (65 961)Taxes and levies (349 864) 341 130 (8 734)Depreciation charges (9 818) (9 818)Other operating income 9 225 9 225Other operating expenses (14 162) (14 162)Underlying operating profit/(loss) (9 048) (9 048)Non-recurring operating income 8 023 8 023Non-recurring operating expenses (83 951) (83 951)Operating profit/(loss) (84 976) (84 976)


event of a disposal, as part of its business continuity plan.

There were no discontinued operations during the com-parable period comprising financial years 2012 and 2013.

Note 3. Segment information

The financial information for each segment is presented in the same manner as the internal reporting process used to measure the Group’s performance.

Geographical regions

(€000) Poland Western Europe

Lithuania Bulgaria Other Countries

Holding Company

Inter-segment

31 December 2014

Third party revenues 388 631 232 315 60 380 5 705 29 436 62 716 529Inter-segment revenues 14 658 1 277 755 266 4 022 (20 978)Revenues 403 288 233 592 61 135 5 971 29 436 4 084 (20 978) 716 529Excise duties (209 672) (38 607) (1 572) (249 851)Revenues excluding excise duty 193 616 233 592 22 528 5 971 27 864 4 084 (20 978) 466 678

Underlying operating profit/(loss) (1 958) 9 309 1 518 (401) (168) (7 258) 1 042

Other operating income and expenses (14 956)Net financial income/(expenses) (4 224)Tax (charge)/income (60)

Profit/(loss) (18 198)

Goodwill 5 152 24 446 334 29 932Intangible assets 9 875 98 732 118 177 1 235 762 110 900Property, plant and equipment 15 899 14 430 8 120 2 239 2 163 71 42 922Fixed assets 30 926 137 608 8 572 2 416 3 399 833 183 753

Working capital 3 912 36 211 8 100 (6 897) (6 795) 47 726 82 257

Deferred taxes and non-current liabilities (20 452) (45 467) (2 829) 46 286 (31 170) (99 587)

Capital employed 14 385 128 352 13 842 (4 436) (3 110) 17 389 166 423

Capital expenditure 2 263 1 986 211 160 141 84 4 847Depreciation charges (3 001) (2 906) (962) (326) (164) (23) (7 382)



Holding Company

Inter-segment

31 December 2013 restated

Third party revenues 505 154 257 986 50 708 6 246 36 767 3 856 864Inter-segment revenues 16 594 2 303 1 304 413 43 (20 656)Revenues 521 748 260 289 52 012 6 659 36 767 46 (20 656) 856 864Excise duties (282 246) (33 285) (1 768) (317 298)Revenues excluding excise duty 239 502 260 289 18 727 6 659 34 999 46 (20 656) 539 566

Underlying operating profit/(loss) 810 12 490 603 (2 329) 3 284 (14 579) 279

Other operating income and expenses (36 017)Net financial income/(expenses) 226 170Share of profit and loss of associates (272)Tax (charge)/income 307Profit/(loss) 190 467


Working capital 36 941 52 816 8 721 (2 317) (10 170) 36 465 122 456

Deferred taxes and non-current liabilities (25 573) (46 897) (2 933) 134 (1 230) (36 081) (112 579)

Capital employed 46 029 146 756 15 125 127 (5 768) 1 146 203 415

Capital expenditure 1 321 1 177 243 1 547 275 3 4 565Depreciation charges (3 541) (2 746) (1 071) (690) (407) (6) (8 461)


Belvédère generated net consolidated revenues of €466.7 million in 2014, down 13.5% from 2013.

The revenues set out above take into account the new presentation rules described in section 2 of Note 1.2 – Ac-counting principles and policies.



Holding Company

Inter-segment

31 December 2012 restated

Third party revenues 536 293 260 208 47 424 9 104 38 857 13 891 899Inter-segment revenues 17 935 1 611 3 641 1 115 46 46 (24 394)Revenues 554 228 261 819 51 065 10 219 38 903 59 (24 394) 891 899Excise duties (306 843) (32 004) (1 788) (340 636)Revenues excluding excise duty 247 385 261 819 19 061 10 219 37 115 59 (24 394) 551 264

Underlying operating profit/(loss) 8 608 3 962 380 (5 161) (7 027) (9 809) (9 047)

Other operating income and expenses (75 928)Net financial income/(expenses) (24 562)Share of profit and loss of associates 211Tax (charge)/income (9 231)Profit/(loss) (118 557)


Working capital (345) 48 957 6 928 1 186 (8 344) (22 829) 25 553

Deferred taxes and non-current liabilities (1 949) (35 374) (3 075) 39 810 (128) (39 677)

Capital employed 40 015 176 529 14 039 20 252 (790) (22 192) 227 853

Capital expenditure 947 1 034 1 118 735 229 7 4 070Depreciation charges (3 952) (3 331) (907) (1 103) (515) (9) (9 817)


Note 4. Notes to the income statement

Note 4.1 External expenses

As a reminder, the Group signed a four-year partnership agreement with Bruce Willis, the US actor and film pro-ducer, for the promotion of Sobieski Vodka in 2009. This agreement ended in January 2014.

The main changes in external expenses in 2014 main-ly consisted of a €6.6 million reduction in marketing ex-penses. This decrease was primarily due to the full-year effect of the termination of the representation agreement with Bruce Willis.

Note 4.2 Personnel costs

Group headcount at year-end

The most significant changes over the 2014 financial year were as follows:

- Restructuring in Poland (-223 people) and Bulgaria (-96 people);

- The removal of 103 people from the Ukraine headcount following the deconsolidation of the subsidiary.

Note 4.3 Other operating income and expenses

(€000) 2014 2013restated

2012restated

Marketing and promotion (18 029) (24 602) (27 203)Rental and maintenance (13 052) (14 065) (14 208)Transport (11 236) (14 161) (15 677)Other external services (31 982) (29 626) (31 392)External charges (74 298) (82 455) (88 479)

(€000) 2014 2013 2012

Payroll (43 638) (48 643) (50 602)Social security and personal insurance charges (13 839) (14 747) (15 238)Retirement provisions (266) (263) 61Others (194) (250) (182)

Personnel costs (57 937) (63 903) (65 961)

31 December 2014 31 December 2013 31 December 2012

Total headcount 2 493 2 975 3 142

(€000) Income Expenditure 2014 net 2013 net 2012 net

Provisions and reversals 10 490 (6 992) 3 498 (1 625) (2 362)Proceeds from disposals of fixed assets 2 (159)Other operating income and expenses 4 254 (6 018) (1 764) (2 294) (2 415)Other operating income and expenses 14 744 (13 010) 1 734 (3 917) (4 936)


Note 4.4 Non-recurring operating income and expenses

Non-recurring income and expense reflects transactions of a non-recurring nature, and is excluded from income from continuing operations to clarify comprehension and enable comparison between the periods presented.

2014 non-recurring net income broke down as follows:

- The impairment relates to a €0.7 million impairment charge on a biogas plant in Poland;

- The net restructuring expenses primarily consist of the costs relating to the closure of entities in India, Belarus and Ukraine (€5.4 million), the reorganisation of the sales force in Poland (€1.0 million) and the departure of em-ployees who were not replaced at the French (€0.9 million) and US (€0.7 million) entities;

- Net income from asset disposals is primarily related to the disposal of shares in CI Nolet & Co, in an amount of €1.0 million;

- The main expenses relating to the Group’s financial restructuring were:

o The fees excluding tax payable to Krzysztof Try-linski in relation to his support contract, which amounted to €2.3 million. Krzysztof Trylinski provided no services under this contract in 2014;

o A €3 million charge relating to the impairment of a stock of vodka acquired by one of the Polish entities in 2013. The assessments performed on this vodka show that the purchase value of the stock is not in line with obser-ved purchase prices for vodkas in the same category. The Group reserves the right to initiate proceedings in connec-tion with this purchase;

o Expenses and fees relating to various legal proceedings, which amounted to €1.7 million.

Other operating income amounted to €32.4 million in 2013 and primarily consisted of €21.1 million in proceeds from the disposal of assets, and of the reversal of a provi-sion for FRN fees amounting to €9.1 million.

Other operating expenses amounted to €68.5 million in 2013, including the €22.8 million net book value of the as-sets sold, €20.1 million in fees relating to legal proceedings and €9.2 million in asset impairment charges.

(€000) Income Expenditure 2014 net

Impairment of goodwill, fixed assets and PP&E (674) (674)Restructuring income and expenses 2 439 (11 122) (8 683)Gains/losses on asset disposals 5 208 (4 554) 654Items related to Group financial restructuring 765 (7 018) (6 253)Other non-recurring income and expenditure 8 412 (23 368) (14 956)


Other non-recurring income and expenditure 32 436 (68 453) (36 017)


Other non-recurring income and expenditure 8 023 (83 951) (75 928)


Note 4.5 Net financial income

The decrease in the cost of debt compared with previous periods was primarily due to the Group’s financial restruc-turing, which took place in 2013. Interest and similar ex-pense amounted to €1.6 million in 2014 and primarily cor-responded to the cost of bank overdrafts for some entities.

Other financial income and expense was primarily af-fected by foreign exchange gains and losses and by the impact of discounting the liabilities declared by creditors (excluding the FRN and bonds with redeemable warrants [OBSAR]) during the implementation of the rehabilitation plan and the arrangement of the carry-back receivable.

Note 4.6 Income tax

Current taxes

The regions incurring the largest current tax charge are Brazil (€0.3 million) and the Baltic states (€0.2 million).

The Polish entities recognised a portion of their tax-loss carry-forward in 2014.

The Group has tax-loss carry-forwards, primarily in France (€209.4 million as at 31 December 2014), the US and Poland.

Given the outlook regarding short-term taxable inco-me, the Group only recognised €0.9 million of its tax-loss carry-forwards in Poland.

Reconciliation of the effective tax charge with pre-tax income

(€000) Income Expenditure 2014 2013 2012

Income from cash and cash equivalents 249 249 165 438Interest and similar charges (1 579) (1 579) (7 762) (21 887)Net cost of borrowings 249 (1 579) (1 330) (7 597) (21 449)

(€000) Income Expenditure 2014 net 2013 net 2012 net

Provisions and reversals 100 (262) (162) (88) (5 778)Exchange gains/losses 5 087 (2 305) 2 783 (1 946) 1 392Discounting effects 915 (6 934) (6 019) 30 420 564Difference between the fair value and book value of the FRN debt 203 942Other income 708 (205) 504 1 438 710Other operating income and expenses 6 811 (9 705) (2 895) 233 767 (3 112)

Net financial items 7 060 (11 284) (4 224) 226 169 (24 561)

(€000) 2014 2013 2012

Current tax (1 019) 1 566 (9 163)Deferred taxes 958 (1 839) (68)Income tax expenses (60) (272) (9 231)

(€000) 2014 2013 2012

Total consolidated net income/(loss) (18 198) 190 467 (118 558)Share of profit/(loss) of associates (307) (211)Less net profit/(loss) from discontinued operationsTax (charge)/income 60 272 9 231Pre-tax net profit/(loss) (18 138) 190 433 (109 538)Theoretical tax charge at statutory rate (36.10%) 6 548 (68 746) 39 543Permanent tax differences (1 870) 74 218 (1 360)Provision for taxes 175 (6 367)Impact of tax losses brought forward 989 3 451 120Recognition/(derecognition) of prior losses not recognised/(recognised) 643 (906) (7 314)Impact of goodwill impairment charges (16 871)Unrecognised deferred tax 10 097 11 045Impact of losses not recognised (6 631) (16 762) (28 908)Income tax on French companies at different rates (258) (714) (330)Income tax on foreign companies at different rates (174) (1 230) 1 277Tax credits 693 146Other impacts (67)Actual tax expense (60) (272) (9 231)


Unrecognised tax losses primarily belong to the French sub-group, including €4,833,000 for Belvédère SA and €1,256,000 for Marie Brizard.

Change in deferred tax asset and liability ba-lances

The deferred tax assets primarily consist of recognised tax losses and deferred tax arising from temporary diffe-rences. Tax-loss carry-forwards are recognised by compa-nies that expect to be able to use these losses in the short term.

Deferred tax liabilities mostly relate to asset valuation differences recorded at the time these assets were acquired, primarily within the Marie Brizard sub-group.

Tax receivables shown on the balance sheet The amount of the tax receivables shown on the balance

sheet as at 31 December 2014 (€33,164,000) primarily cor-responds to Belvédère’s carry-back receivable. The repay-ment of this receivable (€31,011,000) was obtained on 26 February 2015.

Note 4.7 Earnings per share

(€000) 2013 Recorded in the income statement

Reclassification Change in consolidation

Translation differences

2014

Deferred tax assets 2 497 2 144 (1 358) (1) 111 3 393Deferred tax liabilities 40 731 1 186 (3 300) 31 120 38 768Net deferred tax assets (38 234) 958 1 957 (32) (10) (35 360)


Reclassification Translation differences

2013

Deferred tax assets 4 373 (2 454) 1 202 (624) 2 497Deferred tax liabilities 40 880 (614) 1 133 (668) 40 731Net deferred tax assets (36 507) (1 840) 176 44 (38 234)




2012

Deferred tax assets 11 006 (6 849) 216 4 373Deferred tax liabilities 47 422 (6 781) 239 40 880Net deferred tax assets (36 416) (68) (23) (36 507)

€000 unless stated otherwise 2014 2013 2012

Numerator(€000)Net profit/(loss), Group share (19 096) 190 260 (117 792)Net profit/(loss) from continuing operations, Group share (19 096) 190 260 (117 792)Denominator(number of shares)Number of shares outstanding 26 479 328 19 077 206 2 996 118Number of shares outstanding after dilution 32 429 232 25 027 382 2 996 118Earnings per share (in €)Net earnings per share, Group share (€) -0,72 € 9,97 € -39,31 €Diluted net earnings per share, Group share (€) -0,72 € 7,60 € -39,31 €Net earnings per share from continuing operations, Group share (€) -0,72 € 9,97 € -39,31 €Diluted net earnings per share from continuing operations, Group share (€) -0,72 € 7,60 € -39,31 €


Note 5. Notes on consolidated assets

Note 5.1 Goodwill

(€000) Opening 31/12/2013

Impairment Change in consolidation

Transfer Translation differences

Closing 31/12/2014

Gross goodwill: 186 760 (7 483) (1 420) (1 015) 176 842 - France 143 216 143 216 - Poland 41 461 (7 156) (1 361) (1 005) 31 939 - Ukraine 327 (327) - USA 1 315 1 315 - Others 441 (59) (10) 372Impairment: (156 114) 7 020 1 332 852 (146 910) - France (118 770) (118 770) - Poland (35 604) 6 692 1 273 852 (26 787) - Ukraine (327) 327 - USA (1 315) (1 315) - Others (97) 1 59 (38)Net goodwill 30 646 (462) (88) (164) 29 932

(€000) Opening 31/12/2012



Closing 31/12/2013

Gross goodwill: 187 615 (855) 186 760 - France 143 216 143 216 - Poland 42 278 (817) 41 461 - Ukraine 349 (22) 327 - USA 1 315 1 315 - Others 457 (16) 441Impairment: (156 847) 733 (156 114) - France (118 770) (118 770) - Poland (36 306) 702 (35 604) - Ukraine (349) 22 (327) - USA (1 315) (1 315) - Others (107) 10 (97)Net goodwill 30 768 (122) 30 646

(€000) Opening 31/12/2011



Closing 31/12/2012

Gross goodwill: 183 955 3 660 187 615 - France 143 216 143 216 - Poland 38 637 3 641 42 278 - Ukraine 357 (8) 349 - USA 1 315 1 315 - Others 430 27 457Impairment: (107 519) (46 733) (2 595) (156 847) - France (80 428) (38 342) (118 770) - Poland (25 665) (8 036) (2 605) (36 306) - Ukraine (355) 6 (349) - USA (1 315) (1 315) - Others (111) 4 (107)Net goodwill 76 437 (46 733) 1 065 30 768


The goodwill arose from the historical brand acquisi-tions made by the Belvédère Group. The three most im-portant acquisitions were Marie Brizard, William Peel, and Berger.

The changes in the consolidation scope set out in the table below relate to the deconsolidation of the Wawrzynia trademark in Poland as a result of its liquidation.

I M PA I R M E N T T E S T S O N G O O D W I L L :

A review of the Group’s assets was performed as at 31

December 2014, in accordance with IAS 36. The cash ma-nagement plans used for these tests were based on the as-sumptions presented to investors as part of the 2018 BIG strategic plan. The key assumptions used to prepare this plan specifically include the expected growth rates for the wine and spirits sector and the Group’s ability to success-fully implement the initiatives described in the plan pre-sentation under Note 1.1 – Highlights.

Impairment tests were performed on the following re-gions in 2014: France, Poland and Lithuania.

No impairment charge was recorded for 2014 on the ba-sis of the goodwill impairment tests.

S E N S I T I V I T Y T E S T I N G

- Poland

In view of the value of the assets as at 31 December 2014, the sensitivity tests show that no impairment charges would need to be recorded in the event of a change in the assumptions, as simulated above.

- France


- Lituanie


Assumptions adopted Value adoptedChange in

assumptionsSimulated

valueImpact on value

in use (€000)

Discount rate 10,00% +0.5 pt 10,50% (5 386)Growth rate to infinity 2,00% -0.5 pt 1,50% (4 302)Operating margin 12,57% -0.5 pt 12,07% (3 914)

(9 150)(9 012)

Impact of combined application of discount rate and growth rateImpact of combined application of discount rate and operating margin




in use (€000)


(26 230)(25 409)





in use (€000)


(2 758)(2 655)



Note 5.2 Trademarks and other intangible as-sets

(1) The Danzka trademark was sold for €19,400,000 on 10 April 2013, resulting in a €3,726,000 capital gain. €15,400,000 was received when the agreement was signed, while the €4 million balance was placed in an escrow ac-count with Caisse des Depots et Consignations until 10 May 2014 (12 months and 30 days, which corresponds to the warranty period).

(€000) Opening 31/12/2013

Acquisitions Disposals Net charges/impairment

Movements and reclassifications

Change in consolidation


Closing 31/12/2014

Concessions and patents 2 257 62 (61) (8) (6) 2 244Trademarks 138 645 (170) 138 475Other intangible assets 21 251 231 (67) (45) (11) (327) 21 031Gross 162 153 292 (128) (53) (11) (503) 161 750 Concessions and patents (642) 61 (18) (853) 6 (1 447)Trademarks (36 147) (33) 115 (36 065)Other intangible assets (14 123) 38 (339) 883 1 202 (13 339)Amortisation and provisions (50 912) 99 (390) 29 1 324 (50 850) Net 111 240 292 (29) (390) (23) (11) (179) 110 900

(€000) Opening 31/12/2012





Closing 31/12/2013

Concessions and patents 2 348 57 (141) (9) 2 257Trademarks 154 702 (15 674) (383) 138 645Other intangible assets 21 243 275 (41) (226) 21 251Gross 178 294 332 (15 856) (618) 162 153 Concessions and patents (780) 131 8 (642)Trademarks (32 112) (3 976) (58) (36 147)Other intangible assets (13 667) (520) 64 (14 123)Amortisation and provisions (46 560) (4 366) 14 (50 912) Net 131 734 332 (15 856) (4 366) (605) 111 240

(€000) Opening 31/12/2011





Closing 31/12/2012

Concessions and patents 2 401 (53) 2 348Trademarks 154 283 419 154 702Other intangible assets 20 200 40 (28) 1 031 21 243Gross 176 885 40 (28) 1 397 178 294 Concessions and patents (820) (13) 52 (780)Trademarks (16 131) (15 982) (32 112)Other intangible assets (12 022) 28 (1 385) (288) (13 667)Amortisation and provisions (28 973) 28 (17 380) (236) (46 560) Net 147 912 40 (17 380) 1 161 131 734


T R A D E M A R K S

The net book value of the trademarks was €102,411,000 as at 31 December 2014. The main trademarks valued were those of the Marie Brizard sub-group (acquired by the Group in 2006).

The Zawisza trademark was pledged to a bank as secu-rity for a loan for a residual principal amount of €1,360,000 as at 31 December 2014.

L E A S E H O L D R I G H T S

Long-term leasehold rights on land in Poland meet the criteria for recognising an intangible asset under IFRS, and are amortised over the 99-year period of the long-term lease.

The net value of the long-term leasehold rights reco-gnised under Other intangible assets as at 31 December 2014 amounted to €7,367,000.

I M PA I R M E N T T E S T S O N T R A D E M A R K S

A review of the Group’s assets was performed as at 31 December 2014, in accordance with IAS 36.

The method used to determine the value-in-use of the trademarks is set out in Note 1.2 – Accounting rules and policies; Section 10 – Trademarks and other intangible as-sets.

During the impairment tests on goodwill and trade-marks, the long-term growth assumptions used were deter-mined by taking into account the growth rates recorded over the last few financial years, and the growth prospects arising from the assumptions in the 2018 BIG plan.

Accordingly, no impairment charges or reversals of pro-visions for impairment were recorded as at 31 December 2014.

S E N S I T I V I T Y T E S T O N A L L T R A D E M A R K S :

Assumptions adopted Value adoptedPolish trademarks

Value adoptedPolish trademarks

Change in assumptions

Impairment (€000)

Discount rate 10.00% 7.80% +0.5 pt (4 893)Growth rate to infinity 2.00% 2.00% -0.5 pt (4 105)Operating margin -0.5 pt (997)

Impact of combined application of discount rate and growth rate (8 400)

Impact of combined application of discount rate and operating margin (5 859)

Varies according to trademarks


Note 5.3 Property, plant and equipment

C A P I TA L E X P E N D I T U R E

There was no major capital expenditure in 2014.

Most of the Group’s capital expenditure was assigned to upgrading and replacing production equipment.

(€000) Opening 31/12/2013


Allocations of assets in

progress and reclassification



Closing 31/12/2014

Land 11 477 166 (49) (483) (32) 11 079Buildings 91 846 626 (578) (3 366) (1 284) (682) 86 563Plant, machinery and equipment 101 589 1 133 (2 219) (326) (2 686) (1 030) 96 460Other PP&E 23 285 2 333 (3 272) (353) (390) (118) 21 483PP&E in progress 992 297 (260) (7) 1 023Gross 229 189 4 555 (6 118) (4 788) (4 360) (1 869) 216 608

Landscaping (1 415) (62) 5 (1 472)Buildings (61 149) 425 (2 958) (3 474) 295 457 (66 405)Plant, machinery and equipment (87 606) 2 149 (3 577) 532 1 247 889 (86 366)Other PP&E (27 045) 1 911 151 5 391 375 78 (19 138)PP&E in progress (321) (2) 19 (304)Depreciation and provisions (177 537) 4 485 (6 448) 2 468 1 917 1 429 (173 686) Net 51 652 4 555 (1 633) (6 448) (2 320) (2 443) (440) 42 922

(€000) Opening 31/12/2012






Closing 31/12/2013

Land 12 089 4 (337) 3 (281) 11 477Buildings 93 700 278 (1 308) (162) (663) 91 846Plant, machinery and equipment 105 516 1 420 (5 318) 1 070 (1 100) 101 589Other PP&E 28 953 2 158 (6 751) (851) (224) 23 285PP&E in progress 2 888 372 (533) (1 721) (14) 992Gross 243 148 4 233 (14 249) (1 660) (2 282) 229 189

Landscaping (1 319) (98) 2 (1 415)Buildings (59 767) (1 911) 181 348 (61 149)Plant, machinery and equipment (88 044) (227) (87) 767 (87 590)Other PP&E (14 245) (13 039) 65 158 (27 061)PP&E in progress (298) (28) 5 (321)Depreciation and provisions (163 673) (15 303) 159 1 280 (177 537) Net 79 475 4 233 (14 249) (15 303) (1 501) (1 003) 51 652

(€000) Opening 31/12/2013






Closing 31/12/2014

Land 12 123 133 (254) 87 12 089Buildings 87 771 700 (31) 1 914 3 346 93 700Plant, machinery and equipment 103 464 960 (463) 389 1 166 105 516Other PP&E 28 314 1 352 (1 154) 441 28 953PP&E in progress 4 406 879 (126) (2 303) 33 2 888Gross 236 079 4 024 (2 028) 5 073 243 148

Landscaping (1 212) (100) (7) (1 319)Buildings (55 542) 10 (3 013) (1 222) (59 767)Plant, machinery and equipment (81 095) 459 (5 404) (2 004) (88 044)Other PP&E (13 323) 995 (1 510) (407) (14 245)PP&E in progress (270) (28) (298)Depreciation and provisions (151 442) 1 464 (10 055) (3 640) (163 673) Net 84 637 4 024 (564) (10 055) 1 433 79 475


Note 5.4 Financial assets

Equity investments

Non-consolidated companies are either non-trading companies or companies in the process of being shut down.

The shares in deconsolidated companies are reincor-porated into the balance sheet at the value of their equity on the date of deconsolidation. A provision for risk is re-corded in the event that these companies have negative equity.

The other non-consolidated equity investments are stated at their net book value.

Other financial assets

The net value of Other financial assets amounted to €1,579,000 as at 31 December 2014.

The main changes in consolidation scope relate to the deconsolidation of Ukraine (no impact in terms of net va-lue).

(€000) 31/12/2013 Acquisitions/increases

Disposals/decreases

Net charges Reclassification Change in consolidation


31/12/2014

Equity shares 12 458 6 312 (6) 18 764Other long-term securities 901 (884) 17Escrow deposit 4 031 31 (4 062)Other investments 33 608 224 (280) (130) 94 33 515Other receivables 5 362 1 (82) 5 880 11 161Gross 56 360 256 (4 424) 11 178 88 63 458

Equity shares (12 344) (93) (6 308) 5 (18 740)Other long-term securities (883) 883Other investments (32 005) 131 (63) (31 937)Other receivables (5 362) (4 240) (1 555) (11 157)Impairment (50 594) (4 333) (6 849) (58) (61 834)

Net 5 766 256 (4 424) (4 333) 4 329 30 1 624


Disposals/decreases

Net charges Reclassification Change in consolidation


31/12/2013

Equity shares 12 480 (26) 8 (4) 12 458Other long-term securities 2 494 (1 534) (59) 901Escrow deposit 3 675 4 031 (3 675) 4 031Other investments 35 946 141 (1 138) (1 306) (36) 33 608Other receivables 5 362 5 362Gross 54 495 4 172 (6 373) 4 064 (99) 56 360

Equity shares (12 127) 26 (239) (8) 4 (12 344)Other long-term securities (1 441) 461 38 59 (883)Other investments (32 026) 21 (32 005)Other receivables (5 362) (5 362)Impairment (45 594) 487 (239) (5 332) 84 (50 594)

Net 8 901 4 172 (5 886) (239) (1 268) (15) 5 766


Disposals/decreases

Net charges Fair value adjustments



31/12/2012

Equity shares 12 446 26 8 12 480Other long-term securities 2 103 390 2 494Escrow deposit 40 406 201 (36 932) 3 675Other investments 36 419 430 (880) (23) 35 946Gross 91 375 631 (37 812) 390 26 (15) 54 595

Equity shares (11 249) (843) (26) (9) (12 127)Other long-term securities (646) (812) 17 (1 441)Other investments (4 955) (5 081) (22 000) 10 (32 026)Impairment (16 850) (6 736) (22 000) (26) 18 (45 594)

Net 74 525 631 (37 812) (6 736) 390 (22 000) 3 9 002


Breakdown of investments in associates

CI Nolet & Co was sold for a transaction value of €3.5 million, which generated a disposal gain of €1 million. Dis-tilleries Françaises was merged with Marie Brizard as at 31 December 2014.

Note 5.5 Inventory

The decrease in inventory during the 2014 financial year mainly concerned Poland and resulted from working capi-tal optimisation initiatives launched at all Group entities and stepped up during the second quarter of 2014.

The fall in the gross value of the traded goods inventory was primarily due to the impact of excise duties. Produc-tion was boosted towards the end of 2013 in order to anti-cipate the early 2014 increase in this levy.

(€000) 31 December 2013

Profit/(loss) Others 31 December 2014

Investments in associates 3 089 (3 089)CI Nolet & Co 2 497 (2 497)Distilleries françaises 592 (592)

(€000) 31 December 2012

Profit/(loss) Others 31 December 2013

Investments in associates 2 883 307 (101) 3 089CI Nolet & Co 2 374 224 (101) 2 497Distilleries françaises 509 83 592

(€000) 31 December 2011

Profit/(loss) Dividend paid

31 December 2012

Investments in associates 2 723 211 (51) 2 883CI Nolet & Co 2 203 223 (51) 2 374Distilleries françaises 521 (12) 509

(€000) 31 December 2014 31 December 2013 31 December 2012

Raw materials 26 500 28 180 31 430Work in progress 5 062 6 603 8 367Semi-finished and finished goods 17 946 16 657 19 878Traded goods 29 265 56 584 36 838Gross 78 773 108 024 96 513 Raw materials (2 535) (2 918) (2 831)Work in progress (33) (1 433) (1 422)Semi-finished and finished goods (583) (419) (741)Traded goods (5 527) (3 058) (1 920)Impairment (8 678) (7 828) (6 913)

Net 70 095 100 196 89 599


Note 5.5 Trade and other receivables

Some Group companies, primarily in France and Po-land, have signed direct “reverse factoring agreements” with their main customers, in order to optimise their trade receivables item and boost the performance of their key operating working capital indicators.

The decrease in the trade receivables and related ac-counts item is also due to the monitoring process intro-duced by the Group with a view to controlling its working capital.

Accordingly, trade receivables decreased by €44.3 mil-lion over the financial year. The main initiatives imple-mented were:

- Global negotiations on customer payment terms;

Note 5.6 Other current assets

Note 5.7 Cash and cash equivalents

An analysis of the change in cash and cash equivalents is provided in the Cash flow statement.

- The signing of reverse factoring agreements;- The streamlining of the invoicing process through di-

gitisation;- The introduction of a credit management tool.

Some factoring agreements in place in France and Po-land meet the deconsolidation conditions specified by IAS 39; the assigned trade receivables are not shown under ba-lance sheet assets. The amount received in consideration for the receivables not yet due and assigned as at 31 De-cember 2014 was €35.1 million.

(€000) 31 December 2014

31 December 2013

31 December 2012

Trade and other receivables 109 641 153 956 153 449Impairment (10 659) (19 601) (18 221)Net trade receivables 98 982 134 355 135 228

(€000) 31 December 2014

31 December 2013

31 December 2012

Advances and payments on account 2 706 2 977 5 071Tax and employee receivables 10 414 15 937 14 357Derivatives 224 1 1Short-term deposits 818 647 347Other receivables 15 790 14 595 14 762Gross 29 952 34 157 34 538

Other receivables (8 579) (8 288) (7 401)Impairment (8 579) (8 288) (7 401)

Net 21 373 25 869 27 138

(€000) 31 December 2014

31 December 2013

31 December 2012

Marketable securities 2 860 10 615 1 705Cash 74 324 25 856 26 470Cash and cash equivalents 77 184 36 471 28 175


Note 6. Notes on consolidated liabilities and equity capital

Note 6.1 Composition of the share capital and dilutive instruments

The 7,123 treasury shares held at the end of 2014 com-prised 3,437 registered shares and 3,686 bearer shares.

The Group’s treasury shares do not carry any voting rights or entitlement to receive dividends.

P OT E N T I A L D I LU T I O N

31 December 2014

31 December 2013

31 December 2012

Share capital (€) 52 972 964 52 972 426 6 811 358Number of shares 26 486 482 26 486 213 3 405 679Nominal value (€) 2 2 2

Treasury sharesNumber of shares 7 123 3 437 281 285

31 December 2014

31 December 2013

31 December 2012

Number of shares comprising share capital 26 486 482 26 486 213 3 405 679Potential dilution of BSA 2004 / 'BSAR1' 643 788 643 788 585 262Potential dilution of BSAR 2006 / 'BSAR2' 99 521 99 521 130 135Potential dilution of BSA Actionnaires 1 1 316 852 1 317 116Potential dilution of BSA Actionnaires 2 1 317 650 1 317 655Potential BSA OS 2 572 093 2 572 093Potential number of shares 32 436 386 32 436 386 4 121 076

Share capital in euros (nominal value of €2) 52 972 964 52 972 426 6 811 358

C H A N G E S TO T H E WA R R A N T T E R M S A N D CO N D I T I O N S

The Board of Directors meeting on 16 May 2013 in-creased the parity ratios for exercising the 2004 and 2006 warrants (BSA 2004 and BSA 2006) from 1 to 1.10 and from 1 to 1.07 respectively, in accordance with statutory provisions and with the terms of the issuance agreements relating to these warrants, in order to take account of the impact of the issuance and free allocation of shareholder warrants (“BSA Actionnaires”).

Since the Combined Extraordinary and Ordinary Ge-neral Meeting on 30 September 2013, and following the authorisation granted by the holders of the 2004 warrants on 27 September 2013 regarding the amendment of some of the terms and conditions for the 2004 warrants issued in the context of the prospectus bearing AMF visa no. 04-884 dated 10 November 2004, the 2004 warrant exercise price has been set at €26.20 and will not change again until the end of the exercise period, which was also amended to 24 April 2018, (i.e. a subscription price per share of €23.82, while the parity ratio of the 2004 warrants has remained as follows since 16 May 2013: 1 warrant entitles the holder to subscribe to 1.1 Belvédère shares).

Since the Combined Extraordinary and Ordinary Ge-neral Meeting on 30 September 2013, and following the authorisation granted by the holders of the 2006 warrants on 27 September 2013 regarding the amendment of some of the terms and conditions for the 2006 warrants issued in the context of the prospectus bearing AMF visa no. 06-068 dated 9 March 2006, the 2006 warrant exercise price

has been set at €25.49 and will not change again until the end of the exercise period, which was also amended to 24 April 2018, (i.e. a subscription price per share of €23.82, while the parity ratio of the 2006 warrants has remained as follows since 16 May 2013: 1 warrant entitles the holder to subscribe to 1.07 Belvédère shares).

I S S UA N C E O F S H A R E H O L D E R WA R R A N T S

As provided in the Belvédère S.A. rehabilitation plan, the Company issued 6,884,078 shareholder warrants (“BSA Actionnaires”) on 19 April 2013.

The terms and conditions of the subordinated bond (SB) warrants (“BSA OS”) are detailed in the transaction memorandum dated 16 April 2013.

S B WA R R A N T S

In accordance with the terms of the Dijon Commer-cial Court’s ruling dated 26 September 2013 and with a decision taken on 30 October 2013, the Company issued 93,161,762 SB warrants and recorded the final completion of this issue. These SB warrants were subscribed by the holders of the subordinated bonds issued by the Company via offset against the receivables held by said bondhol-ders against the Company. Accordingly, the subordinated bonds issued by the Company have been automatically converted into SB warrants.


Note 6.2 Employee benefits

The Group’s commitments relate to retirement benefits, disability and death annuities (Poland), and long-service awards (or anniversary bonuses in Poland). These defined benefit schemes are recognised in accordance with IAS 19 revised.

The three main countries concerned by employee bene-fits are France, Poland and Spain.

The commitments amounted to €6,079,000 as at 31 De-cember 2014.

S U M M A R Y O F T H E A S S U M P T I O N S U S E D TO C A LC U L AT E T H E CO M M I T M E N T S

The basic assumptions for the actuarial calculations

were determined with the help of actuaries in each country. The assumptions taken into account for 2012, 2013 and 2014 break down as follows for each geographical region:

France Spain Poland France Spain Poland France Spain PolandDiscount rate 1,75% 2,0% 2,75% 3,0% 3,0% 4,0% 2,9% 2,9% 4%Rate of inflation 2% 1,75% 2,5% 2% 3,0% 2,5% 2% 3,0% 2,5%Annual salary increases 2,5% 3,0% 2.5 - 3.5% 2,5% 3,0% 4% 2,5% 3,0% 4%

Staff turnover and mortalityTV/TD

Table 2007-2009

PERM/F-2000-P

Social security office

table and Polish

statistics office table

TV/TD Table 2007-

2009

PERM/F-2000-P


table and Polish


TV/TD Table 2004-

2006

PERM/F-2000-P


table and Polish


31 December 2014 31 December 2013 31 December 2012

Analysis of the charge for the year(€000) 31 December

201431 December

201331 December

2012Cost of services rendered 783 236 599Discounting expense 176 192 224Expected return on dedicated investments (18) (19) (25)Amortisation of actuarial gains and losses (681) (460) 349Charge for the year 260 (51) 1 146

Change in dedicated investments(€000) 31 December

201431 December

201331 December

2012Opening liability 5 694 6 116 5 132Cost of services rendered 783 236 599Discounting expense 176 192 224Services paid (854) (397) (436)Actuarial gains and losses 806 (93) 396Actuarial differences according to IAS 19 revised (294)Other adjustments (6) (20) 4Translation differences (67) (46) 197Closing liability 6 531 5 694 6 116

Change in dedicated investments(€000) 31 December

201431 December

201331 December

2012Opening balance 589 622 560Employer contributions 43 101 138Services paid (195) (143) (162)Expected return 17 17 25Actuarial differences 31 (8) 61Closing balance 483 589 622

Change in balance sheet provision(€000) 31 December

201431 December

201331 December

2012Opening balance 5 132 5 510 4 575Total expense 716 310 1 146Services and contributions paid (457) (361) (412)Actuarial gains and losses 754Actuarial differences according to IAS 19 revised (294)Other adjustments (6) 12 4Translation differences (67) (46) 197Closing balance 6 071 5 132 5 510


Note 6.3 Provisions

TA X P R O V I S I O N S

Tax provisions have primarily been recognised at the Belvédère and Marie Brizard entities. The dispute with the tax authorities relates to the audits on corporation tax, VAT and other levies for the period between 1 January 2006 and 31 December 2007. These tax audits are set out in Note 7.2 – Disputes and contingent liabilities.

E M P LOY E E - R E L AT E D P R O V I S I O N S

The combined current and non-current portions of em-ployee-related provisions amounted to €5.9 million as at 31 December 2014. These amounts correspond to provisions recorded in relation to employment tribunal disputes and job safeguard schemes.

(€000) 31 December 2013

Charges Reversal (prov. used)

Reversal (prov. not used)

Reclassification Variation de périmètre


31 December 2014

Provisions for pensions and employee benefits (see Note 6.2)

5 132 540 (286) 751 (67) 6 071

Employee provisions 2 813 1 717 (1 403) (1 008) 2 119Tax provisions 3 627 3 627Other non-current provisions 632 1 286 (192) 1 726Other non-current provisions 7 072 3 003 (1 403) (1 008) (192) 7 473

Employee provisions – due in < 1 year 3 380 2 014 (697) (1 082) 261 (47) 3 829Other provisions – due in < 1 year 143 143Current provisions 3 523 2 014 (697) (1 082) 261 (47) 3 972

(€000) 31 December 2012





31 December 2013

Provisions for pensions and employee benefits (see Note 22)

5 510 616 (666) (283) (46) 5 132

Employee provisions 160 2 710 (57) 2 813Tax provisions 8 765 -2591 (2 525) (22) 3 627Other non-current provisions 729 122 (299) 91 (11) 632Other non-current provisions 9 654 2 832 (2 947) (2 434) (33) 7 072

Employee provisions – due in < 1 year 2 797 1 807 (1 170) (54) 3 380Other provisions – due in < 1 year 9 285 (9 132) (2) (8) 143Current provisions 12 082 1 807 (10 302) (2) (62) 3 523

(€000) 31 December 2011





31 December 2012

Provisions for pensions and employee benefits (see Note 22)

4 575 1 039 (301) 197 5 510

Employee provisions 133 69 (30) (12) 160Tax provisions 2 887 6 364 (434) (53) 8 765Other non-current provisions 24 897 70 (80) (2 163) (22 000) 5 729Other non-current provisions 27 917 6 503 (110) (2 175) (22 434) (48) 9 654

Employee provisions – due in < 1 year 3 257 516 (734) (210) (32) 2 797Other provisions – due in < 1 year 142 9 143 9 285Current provisions 3 399 9 659 (734) (210) (32) 12 082


Note 6.4 Borrowings

The portion of long-term borrowings maturing in over one year (€2,202,000) is included under Long-term loans – portion maturing in over one year under non-current lia-bilities on the balance sheet.

C H A N G E I N B O R R O W I N G S

The portion of long-term borrowings maturing in less than one year (€1,112,000) is included under Long-term loans – portion maturing in less than year under current liabilities on the balance sheet.

(€000) Bonds

Accrued interest on OBSAR convertible

bonds BondsBank loans

Employee profit-

sharing

Accrued interest on

loansLong-term

borrowings31 December 2011 453 914 6 637 460 551 12 524 151 98 741 571 967New loans 1 257 1 257Repayments (36 678) (36 678) (2 332) (151) (39 161)Net change 19 128 19 128Exercises of BSAR 2 warrants (conversion into equity)

(9 717) (9 717) (9 717)

Translation differences 99 9931 December 2012 407 519 6 637 414 156 11 548 117 869 543 573New loans 810 810Repayments (2 591) (2 591) (6 853) (9 444)Net change (33) 4 774 4 741Exercises of BSAR 2 warrants (conversion into equity)

(2 041) (2 041) (2 041)

Conversion of FRN bonds (336 041) (336 041) (102 965) (439 006)Conversion of OBSAR bonds (66 846) (6 637) (73 483) (19 678) (93 161)Reclassification as BSA fixed liability (1 587) (1 587)Translation differences (52) (52)31 December 2013 3 833 1 3 834New loans 1 358 19 1 377Repayments (1 596) (1 596)Reclassifications (265) (265)Translation differences (36) (36)31 December 2014 3 294 19 3 313

(€000) 31 December 2014

< 1 year 1 to 5 years

BondsBank loans 3 294 1 093 2 202Accrued interest on loans 19 19Long-term borrowings 3 313 1 112 2 202

Short-term borrowings 32 321 32 321

(€000) 31 December 2013


BondsBank loans 3 833 1 480 2 353Accrued interest on loans 1Long-term borrowings 3 834 1 480 2 353

Short-term borrowings 13 510

(€000) 31 December 2012


Bonds 414 156 414 156Bank loans 11 548 8 173 3 375Accrued interest on loans 117 869 117 869Long-term borrowings 543 573 540 198 3 375



Note 6.5 Financial instruments and financial risk factors

FA I R VA LU E O F F I N A N C I A L I N S T R U M E N T S ACCO R D I N G TO I A S 39 C L A S S I F I C AT I O N

(€000)

Financial assets and liabilities at

fair value through profit

or loss DerivativesAssets held for

sale

Loans, receivables and borrowings at

cost less depreciation

31 December 2014

Assets:Non-current financial assets 17 24 1 582 1 624Trade receivables 98 982 98 982Other current assets 21 149 21 149Asset derivatives 224 224Cash & cash equivalents 77 184 77 184

Liabilities:Long-term borrowings – due in more than one year 2 202 2 202Long-term borrowings – due in less than one year 1 112 1 112Short-term borrowings 32 321 32 321Trade and other payables 56 985 56 985

(€000)




sale



31 December 2013

Assets:Non-current financial assets 18 114 5 634 5 766Trade receivables 134 355 134 355Other current assets 25 868 25 868Asset derivatives 1 1Cash & cash equivalents 36 470 36 470

Liabilities:Long-term borrowings – due in more than one year 2 353 2 353Deferred payables - due in more than one year 71 531 71 531Long-term borrowings – due in less than one year 1 480 1 480Short-term borrowings 13 510 13 510Trade and other payables 64 308 64 308

(€000)




sale



31 December 2012

Assets:Non-current financial assets 1 053 354 7 595 9 002Trade receivables 135 228 135 228Other current assets 27 137 27 137Asset derivatives 1 1Cash & cash equivalents 28 175 28 175

Liabilities:Long-term borrowings – due in more than one year 3 375 3 375Long-term borrowings – due in less than one year 540 198 540 198Short-term borrowings 23 818 23 818Trade and other payables 110 551 110 551


L I Q U I D I T Y R I S K R E L AT I N G TO G R O U P D E B T

Since the implementation of the rehabilitation plan ap-proved by the Dijon Commercial Court in its judgement of 19 March 2013, Group debt has decreased significantly, which enables the risk relating to gearing to be materially reduced.

The Belvédère Group has announced that it paid the plan’s administrator, Mr Fréderic Abitbol, the amounts of the 2nd dividends payable on 19 March 2015 for the seven Group companies involved (Belvédère SA, Marie Brizard et Roger International SA, Sobieski SP Zoo, Destylernia Sobieski SA, Sobieski Trade SP Zoo, Domain Menada SP Zoo and Fabryka Wodek Polmos Lancut SA).

R I S K R E L AT I N G TO S H A R E S A N D OT H E R F I N A N C I A L I N V E S T M E N T S

The Group has no financial investments likely to be ex-

posed to the risk of price fluctuations.

I N T E R E S T R AT E R I S K

• Sensitivity to interest rates

C R E D I T R I S K Generally speaking the Group’s customers are diversi-

fied and there is no material risk relating to dependence on customers.

• Maturity of trade receivables

Moncigale’s frozen debt is also the subject of a gradual repayment schedule.

The 2nd dividend paid by Moncigale was paid to Mr Torelli, the plan administrator, in April 2015.

During the first half of 2014 the Group drew up cash flow forecasts which are updated every month based on the operating plans. These forecasts are designed to provide visibility across the entire consolidation scope in order to anticipate and secure the Group’s ability to meet each ins-talment of the rehabilitation plan.

Furthermore, the Belvédère Group has carried out a specific review of its liquidity risk and considers that it is in a position to honour its future instalments.

(€000) 31 December 2014

Not due

< 90 days overdue

90-180 days overdue

> 180 days overdue

Trade and other receivables 109 641 74 744 22 319 1 069 11 509Impairment (10 659) (13) (259) (10 386)Net trade receivables 98 982 74 744 22 305 810 1 123

(€000) 31 December 2013

Not due

< 90 days overdue

90-180 days overdue

> 180 days overdue

Trade and other receivables 153 956 100 608 33 594 751 19 002Impairment (19 601) (165) (433) (19 002)Net trade receivables 134 355 100 608 33 429 318 0

(€000) 31 December 2012

Not due

< 90 days overdue

90-180 days overdue

> 180 days overdue

Trade and other receivables 153 449 118 381 13 238 2 721 19 110Impairment (18 221) (186) (740) (17 295)Net trade receivables 135 228 118 381 13 052 1 980 1 814

(€000)31 December

2014 Fixed rate Floating rate

BondsBank loans 3 294 956 2 338Accrued interest on loans 19 19Long-term borrowings 3 313 975 2 338Short-term lines of credit 32 323 32 323

(€000)31 December


BondsBank loans 3 833 1 442 2 391Accrued interest on loans 1 1Long-term borrowings 3 834Short-term lines of credit 13 510 727 12 783

(€000)31 December


Bonds 414 156 75 834 338 322OBSAR accrued interest subject to late payment interest 13 309 13 309Bank loans 11 548 959 10 589Principal 439 013 90 102 348 911Accrued interest excluding OBSAR interest outstanding 104 560Long-term borrowings 543 573Short-term lines of credit 23 818 78 23 740


Note 6.6 Other liabilities

OT H E R N O N - C U R R E N T L I A B I L I T I E S

The rehabilitation plans for the nine companies in the Group were approved by the relevant Commercial Courts in March and April 2013. These plans specifically provide for the deferred repayment of the liabilities declared by the creditors (excluding the FRN and OBSAR convertible bond creditors) over periods of between 6 and 10 years depending on the companies, for creditors that have not opted for immediate partial repayment.

As the changes made to the terms and conditions of the debt were material, in accounting terms they implied the settlement of the existing debt and the issuance of new debt. This new debt was recorded on the balance sheet at its fair value on the date when the plans were approved, and is recognised at amortised cost according to the effec-tive interest rate method. The fair value of the new debt was determined by calculating the total amount of the fu-ture discounted repayments on the date when the former debt was settled.

OT H E R C U R R E N T L I A B I L I T I E S

The dividend instalments payable within one year were classified under current liabilities in accordance with the origin of the liabilities, while the fair value of the estimated future instalments was classified under non-current liabi-lities.

(€000) 31 December 2014

31 December 2013

31 December 2012

Non-current Safeguard Plan liabilities (present value)LT portion of frozen liabilities (rehabilitation plan) 61 749 71 531Investment subsidies 2 465 2 788 3 145Others 13 26 25Other non-current liabilities 64 227 74 346 3 170

(€000) 31 December 2014

31 December 2013

31 December 2012

Advances and down payments 1 380 1 611 1 733Tax and social security payables (incl. excise duty) 55 114 73 464 79 335Investment subsidies 54 54 54DerivativesDeferred income 1 191 1 321 3 214Other payables 20 074 23 712 10 842Other current liabilities 77 813 100 162 95 178


Note 7. Additional information

Note 7.1 Assets pledged as security and off-ba-lance sheet commitments

S U M M A R Y O F A S S E T S P L E D G E D A S S E C U R I T Y

Off-balance sheet commitments

• Deposits for alcohol duties

In some countries (France, Poland, Lithuania and Den-mark) where Group subsidiaries operate, deposits must be paid to customs as security for the payment of excise duties on alcohol. These deposits are generally provided by in-surance companies and banks on behalf of the companies concerned.

The maximum amount of the guarantees given to cus-toms in order to cover the payment of excise duties in Po-land is currently €153 million.

• Long-term purchase commitments

Cognac Gautier has entered into five-year commitments to purchase raw materials for cognac.

William Pitters has entered into five-year commitments to purchases raw materials for Scotch whisky.

Moncigale has entered into three-year commitments to purchase wine.

Commitments to purchase vodka have been entered into in Poland.

Country Nature of obligation Nature of assets Asset book value per consolidated balance

sheet (€000)

31 December 2014

France Long-term bank loan (€1,360,000 principal) Zawisza trademark n/a

Deposit from MBRI to BVD creditor Bonny Mellon 12 632

Poland Loan granted to Sobieski SP. ZOO Operating receivables, current account deposit 12 637

Long-term loans ING bank Slaski Property, operating receivables and trademarks 7 076

Security granted to Customs for excise duty (€153m)

Line of credit Bill of exchange 1 111

Lithuania Line of credit Property, warehouse, inventories, operating receivables, current account deposit, right to use the Sobieski trademark in Vilnius

25 336

Denmark Line of credit Inventories 343

(€000) 31 December 2014

< 1 year 1 to 3 years > 3 years

Commitments relating to issuer's operating activitiesCommitment to purchase raw materials 245 080 111 030 67 601 66 449

(€000) 31 December 2014

Commitments relating to issuer's operating activitiesLease agreements 8 310


• Commitment in Belarus

Belvédère SA owns 98.02% of the shares in FLLC Ga-liart (“Galiart”), a company incorporated under Belarus law.

On 7 February 2008, Galiart entered into an agreement with the Executive Committee of the City of Bobruisk re-garding the process for implementing an investment plan to produce alcoholic beverages in the city of Bobruisk in the Moguilev region, on the basis of which the parties un-dertook to implement an investment plan providing for the opening of an alcoholic beverages production plant in Bobruisk.

Under the terms of the agreement, Galiart is required to guarantee the financing of the project, the costs of which are estimated to be at least €12.9 million. Galiart has not made any investments at this stage.

This company was sold in February 2015.

• Commitment to Krzysztof Trylinski

Krzysztof Trylinski benefits from a guarantee, which provides that the Company will compensate him for any personal loss resulting from the consequences of the si-gning of a memorandum of agreement between Belvédère SA and Angostura Holdings Limited on 4 February 2013. This guarantee was granted for a period of 10 years as from 11 February 2013.

Note 7.2 Disputes and contingent liabilities

TA X AU D I T S I N F R A N C E

Belvédère S.A. together with the other tax group com-panies were the subject of an accounting audit for tax pur-poses that began on 19 January 2009. In the case of most of the subsidiaries concerned, the audit covered corporation tax, VAT and other levies for the period between 1 January 2006 and 31 December 2007.

The total amount of these adjustments is around €25.4 million (including surcharges and late payment interest), including €17.9 million of corporation tax, €6.7 million of withholding tax, €0.6 million of corporation tax social se-curity contributions and €0.2 million of VAT.

The main reason for the adjustment is the rejection of the deduction of interest relating to a €375 million loan issued in the form of transferable floating-rate notes, or “FRNs”. This agreement, which was entered into on 24 May 2006, is governed by the law of New York State.

Amongst the proposed adjustments, the increases re-lated to FRN interest amount to €15.8 million for 2006 and to €28.1 million for 2007. These adjustments resulted in ad-ditional corporation tax (excluding late payment interest)

of €15.1 million for 2006 and 2007, as well as additional withholding tax of €5.3 million for 2006.

A recovery notice for this tax was issued in April 2012.

These adjustments were disputed via claims, including a request for deferred payment, and then via applications instituting proceedings in the Montreuil Administrative Court.

The Montreuil Administrative Court rejected the appli-cation submitted by Belvédère in two decisions issued on 29 December 2014.

Belvédère S.A. appealed both judgements via two ap-peals lodged at the Versailles Administrative Appeal Court on 25 February 2015.

If it is confirmed, the tax receivable will need to be sett-led as part of the rehabilitation plan approved by the Dijon Commercial Court. As matters stand, Belvédère believes that no plan dividend can be paid to the tax authorities while these receivables remain contested and have not been subject to a final ruling.

In view of the foregoing and Belvédère’s confidence in the favourable outcome of this dispute, no provision has been recorded in connection with this dispute. A provision of €3.5 million is still recorded on the balance sheet for the other adjustment items.

In the event that its appeal is rejected by the Versailles Administrative Appeal Court, the Group will be required to pay the amounts due in connection with the aforemen-tioned adjustments relating to 2006 and 2007. In addition, the Group may be required to repay the amounts received in connection with the 2008 carry-back, i.e. €10.4 million. Lastly, in the event that the deduction of the FRN interest for the subsequent financial years is ruled out, the corres-ponding adjustments would reduce the French tax group’s tax-loss carry-forward.

It is appropriate to recall that the request for repayment of a carry-back receivable was made to the tax authorities in late 2014, and resulted in the repayment of that recei-vable in an amount of €31.0 million on 26 February 2015.

CO M M E R C I A L D I S P U T E

On 17 August 2010, Moncigale, an indirect subsidia-ry of Belvédère, entered into a licensing agreement with Chamarré regarding the exclusive use, production and distribution of the “Chamarré” still wine trademark for a period of 10 years. Under the terms of this agreement, Moncigale undertook to pay Chamarré an annual royalty indexed to the volumes sold and revenues generated by the products sold under the Chamarré trademark, as well as a guaranteed minimum annual royalty.


On 16 June 2011, the Nîmes Commercial Court insti-tuted safeguard proceedings in favour of Moncigale. These proceedings were turned into rehabilitation proceedings by the same Commercial Court on 21 September 2011. The Court appointed a court administrator to assist the com-pany.

On 9 November 2011, the administrator informed Cha-marré of the termination of this agreement pursuant to the provisions of Article L 622-13 of the French Commercial Code.

On 30 August 2011, in connection with the rehabilita-tion proceedings initiated in favour of Moncigale and the assessment of liabilities carried out on the opening date of the proceedings, Chamarré filed a notice of claim with the creditors’ representative for the amount of €10.7 million, which corresponds to the total amount of the guaranteed royalties over the ten-year term of the agreement and an es-timate of the other liabilities arising from that agreement.

On 6 December 2011, Chamarré fi led an additional “claim for damages” for an amount of €20 million, fol-lowing notice of the termination of the agreement.

These claims were disputed by the Company, and were stayed by the Nîmes Commercial Court pending the deci-sion of the Paris Commercial Court. In fact, proceedings against the bodies in charge of the Moncigale insolvency proceedings were initiated by the Official Receiver for Cha-marré in the Paris Commercial Court via a summons dated 8 February 2013.

Chamarré was placed under court-ordered reorganisa-tion proceedings on 31 May 2012, and its entry into liqui-dation proceedings was announced on 5 June 2012.

On 29 May, 2013, in parallel with these initial procee-dings, Mr Torelli, the Mongicale plan administrator, ap-plied to the Nîmes Commercial Court and the State Prose-cutor with a view to terminating Moncigale’s court-ordered rehabilitation plan and initiating insolvency proceedings against Moncigale on the grounds of failure to execute the plan.

The application stated that the plan, as drawn up by the judgement of 16 April 2013, had not been complied with, as the company had not paid a monthly amount based on the accepted and contested liability, as provided for in the ruling.

The Nîmes Commercial Court ruled on this application on 21 August 2013 and stayed it pending the outcome of the proceedings in the Chamarré case.

In a judgement dated 6 February 2014, the Paris Com-mercial Court ruled that it did not have the appropriate jurisdiction; as this ruling has now become final, the case will now be heard in the Nîmes Commercial Court. The hearing initially scheduled for 9 April 2014 was deferred to 2 July 2014, then to 17 September 2014, and finally to 24 June 2015.

D I S P U T E W I T H A L A I N - D O M I N I Q U E P E R R I N A N D V E R M OT S F I N A N C E

Summons dated 22 February 2013 were served on the following companies by a bailiff on behalf of Alain-Domi-nique Perrin and Vermots Finance, ordering those compa-nies to appear before the Dijon Commercial Court in sum-mary proceedings:

(i) The Company, SCP Valliot-Le Guernevé-Abitbol, Equitis Gestion and SVI, for the specific purpose of (a) establishing the manifestly illegal nuisance caused by the exercise of the voting rights attached to 267,848 shares by Equitis Gestion at the Extraordinary General Meeting held on 12 February 2013, pursuant to a trust agreement dated 4 February 2013, (b) otherwise, of establishing the imminent harm that would result from the exercise of said voting rights by Equitis Gestion, and (c) of suspending the exercise of the voting rights attached to the 267,848 shares for as long as these were held by Equitis Gestion, as a pre-ventive measure;

(ii) T h e C o m p a n y a n d S C P Va l l i o t - L e G u e r n e -vé-Abitbol, specifically for the purpose of having an ad-ministrator appointed by the Court to verify the legality of the counting of postal votes and proxies and to perform the duties assigned by law, the regulations and the Articles of Association to the officers presiding over the Company’s Extraordinary General Meeting convened for the second time on 28 February 2013.

In orders handed down on 26 February 2013, the Presi-ding Judge of the Dijon Commercial Court dismissed their applications and ordered them, under the terms of each of the orders, to pay the amount of €5,000 to the Company and SCP Valliot-Le Guernevé-Abitbol as damages for fri-volous prosecution.

In statements dated 22 March 2013, Alain-Dominique Perrin and Vermots Finance appealed the orders issued on 26 February 2013 by the Presiding Judge of the Dijon Com-mercial Court.

Following the full hearing in the Dijon Appeal Court on 10 April 2014, the case was reserved pending a decision on 12 June 2014.

On 16 April 2015, the Senior Presiding Judge in the Court of Cassation noted the lapse of the appeals lodged by Vermots Finance against the two rulings issued by the Dijon Court of Appeal on 12 June 2014, due to its failure to submit pleadings within the legal timeframe.

D I S P U T E W I T H T H E AU TO R I T É D E S M A R C H É S F I N A N C I E R S ( F R E N C H F I N A N C I A L M A R K E T S AU T H O R I T Y - A M F )

The AMF Sanc t ions Commission init iated procee -dings against the Company on the grounds of breach of its obligation to inform the public and failure to report transactions in its own securities, as well as the crossing of thresholds, and also against Sobieski SARL and SVI on the


grounds of failure to report transactions in the Company’s shares. These accusations were disputed by the Company, Sobieski SARL and SVI.

In a decision issued on 30 April 2014, the AMF Sanc-tions Commissions upheld the accusations made against Belvédère, Sobiesk i SARL and SVI, and ordered them to pay pecuniary fines of €150,000, €45,000 and €15,000 respectively, and ordered the publication of its decision, which was duly published on the AMF website, in accor-dance with practice.

The three companies appealed this decision, and the proceedings are currently in progress at the Paris Court of Appeal. The appeal is scheduled to be heard in the Paris Court of Appeal on 14 January 2016.

A provision was recorded in the 2014 financial state-ments for the full amount of the aforementioned fines.

K R U P N I K T R A D E M A R K D I S P U T E

Proceedings for unfair competit ion were init iated by Destylarnia Sobieski, the Group’s Polish subsidiary, against Toorank Polska Sp.Z.oo on the grounds of the ille-gal use of the Krupnik trademark by the latter.

In fact, this subsidiary has produced, sold and distri-buted a honey-based liqueur under the Krupnik trademark for many years.

Having observed that Toorank Polska was using the Krupnik trademark, it sent that company a letter of notice summoning it to cease such illegal use, which remained wi-thout effect.

The subsidiary consequently decided to initiate legal proceedings on the grounds of unfair competition, relying on the recognition that the Krupnik trademark has earned on the Polish market.

In response, Toorank Polska argued that the Krupnik word mark registered in Destylarnia Sobieski’s name since 1997 was invalid, claiming that the fact that this word is the sales name for a honey-based liqueur in the Polish lan-guage, and was devoid of any distinctive features, meant that it could not be the subject of an exclusive right bene-fiting Destylarnia Sobieski via registration as a trademark.

The Polish Trademark Office upheld Toorank Polska’s arguments and so cancelled the registration of the Krupnik word mark in a decision dated 3 October 2012. This deci-sion was the subject of an appeal that confirmed its terms, and then of an appeal to the Polish Supreme Administra-tive Court, which overturned the appeal; the invalidity of the trademark must therefore be considered as final.

Notwithstanding, this decision is unlikely to have any impact on the proceedings launched by the subsidiary, which were based on the charge, not of counterfeiting, but of unfair competition; these proceedings are still in pro-gress.

It is also worth noting that the Krupnik trademark com-bined with graphic designs has been the subject of sepa-rate filings both in Poland and abroad; the validity of these filings, which relates to the presence of said original visual components, is not likely to be contested.

Lastly, the cancellation of this word mark does not prevent the subsidiary from continuing to use its original Krupnik bottle, which carries a label that is particularly well known in Poland and other European markets.

B U LG A R I A D I S P U T E

At the end of November 2014, the Sofia Court in Bulga-ria decided to place the Bulgarian Belvédère Distribution and Domain Menada subsidiaries under the authority of a provisional administrator instead of the local management team, on the basis of highly questionable grounds and with the support of a magistrate who is subject to disciplinary proceedings.

Following numerous legal proceedings and diplomatic and media interventions, Belvédère regained its rights in January 2015, and the local management team was able to return to managing the subsidiaries in question and regain free access to the premises.

As a reminder, the business activities in Bulgaria ac-count for less than 1% of the Group’s revenues and total consolidated balance sheet. Belvédère intends to take all steps to obtain compensation for the losses suffered in Bul-garia.

U K R A I N E D I S P U T E

Belvédère’s Ukrainian subsidiar y, Belveder Ukraine LLC, was placed in court-ordered liquidation in January 2014, on the basis of a decision taken by the Kiev Commer-cial Court following proceedings initiated at the request of one of the company’s creditors in July 2011.

Belvédère holds around 85% of Belveder Ukraine LLC’s overall debt.

Belveder Ukraine LLC’s assets (including both shares in the subsidiaries owned by the company in liquidation and assets belonging to its subsidiaries, which are now controlled by the liquidator appointed by the Kiev Com-mercial Court) were transferred to a third party outside the Company’s control in November 2014.

Following several proceedings initiated by the Com-pany, the Kiev Court upheld the Company’s claims in ear-ly April 2015, and (i) overturned the sale of its assets in Ukraine, which took place in November 2014, and (ii) or-dered the liquidation proceedings to be reopened.


Note 7.3 Consolidation scope at 31 December 2014

I N 2013:

BELVEDERE S.A.

POLAND Method Interest FRANCE Method InterestSobieski FC 100% Marie Brizard FC 100%Destylarnia Sobieski FC 90,06% Cognac Gautier FC 100%Destylernia Polmos Krakow FC 97,83% Marie Brizard Spain FC 100%Polmos Lancut FC 100% William Pitters FC 100%Domain Menada Poland FC 100,00% Moncigale FC 100%Sobieski Trade FC 100% SCI Roger FC 100%TMT FC 100%Galerie Alkoholi FC 100% USA Method InterestAugustowianka FC 100% Sobieski USA FC 100%Euro Agro Warszawa FC 100% Imperial Brands FC 100%Sobieski International FC 100%Sommelier FC 100% DENMARK Method Interest

Belvedere Scandinavia FC 100%BULGARIA Method Interest Duty Free FC 100%Belvedere Capital Management FC 100,00%Vinimpex FC 100,00% BRAZIL Method InterestBelvedere Distribution FC 100,00% Dubar FC 100%Sakar FC 99,39%Domain Menada Bulgaria FC 100,00% OTHER REGIONS Method InterestDomain Menada Vineyards FC 100,00% Belvedere Slovensko (Slovakia) FC 100%Sakar Vineyards FC 100,00% Sobieski Trading Shanghai (China) FC 100%Bulgaria EOOD FC 100,00% Sobieski Beverages India (India) FC 100%

Galliart (Belarus) FC 98,02%LITHUANIA Method Interest Galliart (Belarus) FC 98,02%Belvedere Prekyba FC 60% SVI (France) FC 100%Belvedere Baltic FC 80% Sobieski Sarl (France) FC 100%Vilnius Degtine FC 68,29% Belvedere Distribution SIA Latvia FC 60%

BELVEDERE S.A.

POLAND Method Interest FRANCE Method InterestSobieski FC 100% Marie Brizard FC 100%Destylarnia Sobieski FC 90,06% Cognac Gautier FC 100%Destylernia Polmos Krakow FC 97,83% Marie Brizard Spain FC 100%Polmos Lancut FC 100% William Pitters FC 100%Domain Menada Poland FC 100% Moncigale FC 100%Sobieski Trade FC 100% Ci Nolet & Co EM 25,05%TMT FC 100% SCI Roger FC 100%TMT Centrum FC 100% French Distilleries EM 100%Rokicki FC 100%Wawrzyniak II FC 100% USA Method InterestHZ FC 100% Sobieski USA FC 100%Hasis FC 100% Imperial Brands FC 100%Galerie Alkoholi FC 100%Tritex FC 100% DENMARK Method InterestRedo FC 100% Belvedere Scandinavia FC 100%Augustowianka FC 100% Duty Free FC 100%Multihurt FC 100%MAAK FC 100% BRAZIL Method InterestEuro Agro Warszawa FC 100% Dubar FC 100%Sobieski International FC 100%Sommelier FC 100% UKRAINE Method Interest

Belvedere Ukraina FC 100%BULGARIA Method Interest Italiano FC 100%Belvedere Capital Management FC 100,00% Boisson Elite FC 100%Vinimpex FC 100,00%Belvedere Distribution FC 100,00% OTHER REGIONS Method InterestSakar FC 99,39% Belvedere Slovensko (Slovakia) FC 100%Domain Menada Bulgaria FC 100,00% Sobieski Trading Shanghai (China) FC 100%Domain Menada Vineyards FC 100,00% Sobieski Beverages India (India) FC 100%Sakar Vineyards FC 100,00% Galliart (Belarus) FC 98,02%

Galliart (Belarus) FC 98,02%LITHUANIA Method Interest SVI (France) FC 100%Belvedere Prekyba FC 60% Sobieski Sarl (France) FC 100%Belvedere Baltic FC 80% Belvedere Distribution SIA Latvia FC 60%Vilnius Degtine FC 68,29%


Note 7.4 Related parties

R E M U N E R AT I O N O F D I R E C TO R S A N D S E N I O R M A N AG E M E N T

(1) Correction relating to the remuneration paid to Ka-tarzyna Paczesniak by Sobieski SARL in respect of the 2012 financial year. Her remuneration was approved by the General Meeting of said company’s shareholders on 28 May 2013.

OT H E R R E L AT E D PA R T I E S

Other related parties primarily consist of non-consoli-dated Group subsidiaries. No material transactions were performed with these parties.

Note 7.5 Statutory Auditors’ fees

The other audits directly relating to the Statutory Au-ditors’ assignment in 2014 mainly involved audits on the internal control system.

Note 7.6 Post-balance sheet events

The main post-balance sheet events are as follows:

R E PAY M E N T O F T H E C A R R Y - B AC K R E C E I VA B L E

Belvédère was informed by the large cap department of the French Public Finance Department that its request for the repayment of a receivable had been accepted on 19 Fe-bruary 2015. As a result, the repayment of €31 million was received on 26 February 2015.

A L LOT M E N T O F B O N U S S H A R E S A N D S TO C K O P T I O N S TO E M P LOY E E S A N D M A N AG E R S

At its meeting on 12 March 2015, the Board of Directors of Belvédère SA (Euronext Paris: BVD) decided to allot 9,320 bonus shares and 480,000 stock options on Belvédère SA shares to certain Group employees and managers, un-der the conditions set out below.

This decision, which was taken with the authorisation of the General Meeting of Shareholders on 16 September 2014, will enable a better alignment of the interests of the beneficiaries (employees and managers) with those of the Belvédère Group’s shareholders.

Allotment of bonus shares

The Board of Directors therefore decided to allot 20 bonus shares to every employee of Belvédère SA and its French subsidiaries, i .e. a total number of 9,320 bonus shares. These bonus shares will vest at the end of a two-year

(€000) 2014 2013 2012

Remuneration received 3 312 940 866(1)Expenses related to post-employment benefits n/a n/a 63Expenses related to compensation at end of employment n/a n/a n/a

Mazars Renart

2014 2013 2012 2014 2013 2012 2014 2013 2012 2014 2013 2012Statutory audit, certification, examination of Company and consolidated financial statements

1 065 1 088 1 047 66% 97% 99% 120 144 136 7% 100% 100%

Belvédère SA 494 613 546 31% 51% 47% 120 144 136 7% 100% Subsidiaries 571 475 501 36% 46% 52% 0% 0%

Other procedures directly related to the statutory audit

516 28 33 32% 3% 1%

1 - - 0% 0% 0%

Belvédère SA 516 25 12 32% 1% 0% 1 - 0% 0% Subsidiaries 3 21 0% 2% 1% 0% 0%

Sub-total audit 1 581 1 116 1 080 99% 100% 100% 121 144 136 8% 100% 100%Other services (legal, tax, HR, other) 21 1% 0% 0% 0%Sub-total other services 21 - Total 1 602 1 116 1 080 100% 100% 100% 121 144 136 8% 100% 100%

€000 €000% %


period following their allotment, on the sole condition that the employee still works at the Company at the end of that period, and with no specific performance conditions. The shares will be non-transferable for a period of five years beginning at the end of the aforementioned vesting period.

Allotment of options subject to performance conditions

The 480,000 stock options (the “Options”) have been al-lotted to 26 managers employed by the Belvédère Group, including Jean-Noël Reynaud, the Chief Executive Officer, who has been allotted 110,000 Options.

The Options will give each beneficiary the right to subscribe to or purchase one share in Belvédère SA at an exercise price of €10.64 per share, calculated on the basis of the average opening price for Belvédère shares over the last 20 trading sessions prior to the date of the Board of Directors’ meeting.

The Options allotted may only be exercised in stages, and subject to the fulfilment of performance conditions under the following conditions:

- A maximum of 20% of the Options allotted may be exercised in 2015, subject to the achievement of a deter-mined level of consolidated underlying operating profit/(loss) for the financial year ended 31 December 2014, on the basis of the 2014 consolidated financial statements, on the understanding that a certain number of these Options could nonetheless be exercised if this target was partially achieved;

- A maximum of 20% of the Options allotted may be exercised in 2016, subject to the achievement of a deter-mined consolidated EBITDA/revenues margin on the basis of the 2015 consolidated financial statements, on the un-derstanding that a certain number of these Options could be exercised if this target was partially achieved;

- A maximum of 60% of the Options allotted may be exercised in 2018, subject to the achievement of a deter-mined consolidated EBITDA/revenues margin on the basis of the 2017 consolidated financial statements, on the un-derstanding that a certain number of these Options could be exercised if this target was partially achieved;

The Board of Directors will assess compliance with

these performance conditions, on the understanding that the condition of employment within the Group at the time when the Options are exercised has also been provided for in the allotment plan.

In addition to the obligation to retain 50% of the shares for a period of two years from the exercise date for the cor-responding Options determined by the Board of Directors, to which all the beneficiaries of the Options will be subject, Jean-Noël Reynaud will be required to retain at least 20% of the shares resulting from the exercise of the Options in

registered form until the termination of his employment, in accordance with paragraph 4 of Article L. 225-185 of the French Commercial Code.

D I S P O S A L O F S U B S I D I A R I E S A N D S T R E A M L I N I N G O F T H E L E G A L S T R U C T U R E

The Belvédère Group disposed of its interest in Galiart, a Belarus company, in February 2015, while the disposal of Galerie Alkoholi, a Polish company, was approved by the Dijon Commercial Court on 21 April 2015.

Furthermore, in order to reduce the number of legal entities that make up the Group, a simplified merger tran-saction between Marie Brizard & Roger International and William Pitters International was performed on 8 April 2015.

4.2 Statutory Auditors’ re-port on the 2014 consoli-dated financial statements


Pursuant to the assignment entrusted to us by your Ge-neral Meeting of Shareholders, we hereby present our re-port for the year ended 31 December 2014 on:

- the audit of Belvédère SA’s consolidated financial sta-tements, as appended to this report;

- the justification of our assessments;- the specific verification required by law.

The consolidated financial statements have been ap-proved by the Board of Directors. It is our responsibility, on the basis of our audit, to express an opinion on these consolidated financial statements.

I - Opinion on the consolidated financial state-ments

We performed our audit according to the standards of the profession applicable in France; these standards require the implementation of procedures enabling rea-sonable assurance to be obtained that the consolidated fi-nancial statements are free of material misstatements. An audit consists in verifying, through sample tests or other selection methods, the documents underlying the amounts and information shown in the consolidated financial state-ments. It also consists of an assessment of the accounting principles followed, the significant estimates made and the presentation of the statements as a whole. We consider that the evidence we have gathered is sufficient and appropriate to form the basis for our opinion.


We hereby certify that, with regard to IFRS as adop-ted within the European Union, the consolidated financial statements for the financial year are in order and accurate and give a true and fair view of the assets and liabilities, fi-nancial position and earnings of the group made up of the persons and entities included in the consolidation scope.

Without calling the above opinion into question, we draw your attention to the following points set out in:

- Note 1.1 “Highlights” in the Notes to the Financial Statements regarding the “Work performed on strengthe-ning the organisational structure and operation of the accounting and financial procedures forming part of the control system”, which describes the work undertaken by the Company in this context. This information remedies the shortfalls that led us to express a qualification in our reports on the previous financial years;

- Sections 2 “Presentation changes” and 3 “New stan-dards and amendments” in Note 1.2 “Accounting rules and policies”, which respectively set out the changes made to the presentation of the consolidated income statement and the new standards of mandatory application;

- Note 4.4 “Non-recurring operating income and ex-penses”, which includes details of expenses relating to the Group’s financial restructuring;

- Note 7.2 “Disputes and contingent liabilities” in the Notes to the Financial Statements, which details the main disputes and contingent liabilities, in particular the dispute between various Group companies and the tax authorities.

II – Justification of our assessments

Pursuant to the provisions of Article L. 823-9 of the French Commercial Code relating to the justification of our assessments, we would draw the following matters to your attention:

- As part of our assessment of the accounting principles and policies applied by your Company, we specifically re-viewed the procedures for impairing goodwill and trade-marks detailed in section 13 “Impairment of fixed assets” in Note 1.2 “Accounting rules and policies”, and in Notes 5.1 “Goodwill” and 5.2 “Trademarks and other intangible assets” to the Financial Statements. We assessed the as-sumptions used to determine the recoverable value of these assets for the purpose of comparing them with their book value. This recoverable value was primarily assessed on the basis of forecast future cash flows discounted as at the end of 2014. We did not identify any factors likely to globally call into question the reasonable nature of the assumptions adopted by Management as part of the impairment tests.

These assessments were made as part of our audit of the consolidated financial statements, taken as a whole, and therefore assisted us in forming our opinion, as expressed

in the first part of this report.

III - Specific verification

In accordance with the professional standards appli-cable in France, we also performed the specific verifica-tions, required by French law, on the information provided in the Group Management Report.

We have no comment to make on the fair presentation of that information and on its consistency with the consoli-dated financial statements.

Fontaine-lès-Dijon and Paris La Défense, 20 May 2015

The Statutory Auditors,

RENART, GUION & ASSOCIES Aurélie TRUCY

MAZARS Romain MAUDRY

Dominique MULLER


4.3 H1 2015 consolidated income statement

half year ConSolidated inCome Statement

€000 unless stated otherwise NoteH1 2015

H1 2014restated(1)

H1 2013restated(1)

Revenues 3 348 020 329 129 402 761Excise duties (125 332) (107 759) (149 115)Revenues excluding excise duties 3 222 688 221 370 253 646Purchases consumed (149 178) (150 392) (177 482)External charges 4 (34 671) (33 396) (40 990)Personnel costs 5 (31 755) (30 312) (32 702)Taxes and levies (4 846) (5 287) (5 334)Depreciation charges (3 085) (3 609) (4 119)Other operating income 6 5 774 6 902 7 042Other operating expenses 6 (5 829) (5 988) (7 691)Underlying operating profit/(loss) (902) (711) (7 629)Non-recurring operating income 7 1 757 1 893 21 742Non-recurring operating expenses 7 (3 054) (3 366) (28 156)Operating profit/(loss) (2 199) (2 184) (14 043)Income from cash and cash equivalents 8 76 126 411Gross cost of borrowings 8 (735) (791) (4 496)Net cost of borrowings (659) (665) (4 085)Other financial income 8 6 362 6 200 157 105Other financial expenses 8 (5 888) (12 655) (14 208)Net financial income/(expenses) (185) (7 120) 138 812Profit/(loss) before tax (2 384) (9 304) 124 769Income tax 9 (383) (115) (2 738)Share of earnings of associates 101Net profit/(loss) from continuing operations (2 767) (9 417) 122 133Profit/(loss) from discontinued operations, net of taxNet profit/(loss) (2 767) (9 417) 122 133Group share (3 239) (9 646) 121 886 of which net profit/(loss) from continuing operations (3 239) (9 646) 121 886 of which net profit/(loss) from discontinued operationsNon-controlling interests 472 227 246 of which net profit/(loss) from continuing operations 472 227 246 of which net profit/(loss) from discontinued operations

Net earnings per share from continuing operations, Group share (€) -0,12 € -0,36 € 10,08 €Diluted net earnings per share from continuing operations, Group share (€) -0,12 € -0,36 € 8,75 €

Net earnings per share, Group share (€) -0,12 € -0,36 € 10,08 €Diluted net earnings per share, Group share (€) -0,12 € -0,36 € 8,75 €

Weighted average number of shares outstanding 26 475 753 26 428 965 12 089 304

Diluted weighted average number of shares outstanding 32 425 496 26 428 965 13 931 402

(1) Restated in light of the changes in accounting policy and presentation explained in Note 1 - Accounting policies and methods


The amounts of comprehensive income/(loss) are shown net of tax.

half year ConSolidated ComprehenSive inCome Statement

€000 H1 2015 H1 2014restated (1)

H1 2013restated (1)

Net profit/(loss) (2 767) (9 417) 122 133Items that may be reclassified to P/L (518) 485 (3 376)Translation differences (1 761) 485 (3 376)Cash flow hedging 1 243Items not reclassified to P/LRevaluation of liabilities under defined benefit pension plans

Comprehensive income/(loss) (3 284) (8 932) 118 757Group share (3 828) (9 160) 118 723Non-controlling interests 544 226 33



half year ConSolidated balanCe Sheet

€000 Note 30 June 2015

31 December 2014

restated(1)

31 December 2013

restated(1)ASSETSGoodwill 11 30 039 29 932 30 646Intangible assets 12 111 119 110 900 111 240Property, plant and equipment 13 43 148 42 922 51 653Financial assets 14 1 931 1 624 5 767Investments in associates 3 089Deferred tax assets 9 2 998 3 220 2 308Non-current assets 189 235 188 597 204 703Inventory and work-in-progress 15 80 831 70 095 100 196Trade receivables 16 95 100 98 982 134 355Tax receivables 1 695 33 164 31 275Other current assets 17 27 024 21 373 25 869Cash and cash equivalents 18 68 995 77 184 36 470Current assets 273 645 300 797 328 167Assets held for sale 2 2 198 5 877Total assets 465 078 495 272 532 870

(€000) Note 30 June 2015

31 December 2014

restated(1)

31 December 2013

restated(1)LIABILITIESShare capital 19 52 974 52 973 52 972Premiums 416 362 416 359 416 353Consolidated and other reserves (261 444) (243 844) (433 791)Translation reserves (19 389) (17 545) (13 968)Consolidated net profit/(loss) (3 239) (19 125) 190 272Equity capital (Group share) 185 264 188 817 211 838Non-controlling interests 11 261 10 696 9 906Total equity capital 196 525 199 514 221 744Employee benefits 20 6 260 6 071 5 132Other non-current provisions 21 6 048 7 473 7 072Long-term borrowings – due in more than one year 22 1 497 2 202 2 353Deferred tax liabilities 9 37 859 38 768 40 731Other non-current liabilities 24 53 131 64 227 74 346Non-current liabilities 104 794 118 740 129 634Current provisions 21 3 790 3 972 3 523Long-term borrowings – due in less than one year 22 1 075 1 112 1 480Short-term borrowings 22 27 686 32 321 13 510Trade and other payables 58 636 56 985 64 310Tax liabilities 1 417 55 (1 494)Other current liabilities 24 71 155 77 813 100 162Current liabilities 163 758 172 258 181 491Liabilities held for sale 2 4 760Total liabilities 465 078 495 272 532 870



half year ConSolidated CaSh flow Statement

€000 30 Juin 20156 mois

30 Juin 20146 mois

restated(1)

30 Juin 20136 mois

restated(1)

Total consolidated net profit/(loss) (2 767) (9 417) 122 133Less net profit/(loss) from discontinued operationsNet profit/(loss) on continuing operations (2 767) (9 417) 122 133Income/(loss) from equity associates (101)Depreciation and provisions 1 634 6 576 9 070Fair value revaluation gains/losses 295 14Impact of discounting 2 970 2 548 (28 664)Difference between the fair value and book value of the FRN debt (124 821)Difference between the fair value/cash obtained on the transfer of treasury shares 66Gains/(losses) on disposals and dilution 286 6 7 886Dividend income (21) 8Operating cash flow after net cost of borrowings and tax 2 485 (308) (14 475)Income tax charge (credit) 383 115 2 738Net cost of borrowings 668 667 4 116Operating cash flow before net cost of borrowings and tax 3 536 473 (7 621) Change in working capital 1 (inventories, trade receivables/payables) (5 203) 31 242 (24 257)Change in working capital 2 (other items) (27 396) (49 104) 41 441Taxes 28 543 (2 800) (589)Cash flows from operating activities (520) (20 189) 8 974

Purchase of PP&E and intangible assets (2 931) (2 392) (1 981)Purchase of financial assets (238)Increase in loans and advances granted (331) (130) (4 075)Decrease in loans and advances granted 35 4 305 3 507Disposal of PP&E and intangible assets 596 270 19 661Disposal of financial assetsOther investment and disposal flowsDividends received (8)Impact of change in consolidation scope 179 3 478Cash flow from investment activities (2 452) 5 531 16 866 Capital increase 7 7 47Purchase of treasury shares (489)Sale of treasury sharesBorrowings received 226 1 077 2 808Borrowings repaid (1 249) (924) (169)Net interest paid (654) (824) (3 937)Net change in short-term debt (4 821) 4 406 (1 958)Cash flow from financing activities (6 491) 3 252 (3 209) Impact of fluctuations in exchange rates 741 155 (1 335)Cash flows from operations sold and sale proceeds 231Change in cash and cash equivalents (8 490) (11 252) 21 296 Opening cash and cash equivalents 77 184 36 470 28 175Cash reclassifications * 300 10 1 306Cash from held-for-sale operationsClosing cash and cash equivalents 68 995 25 228 50 777Change in cash and cash equivalents (8 490) (11 252) 21 296* In 2013, the cash and cash equivalents reclassification corresponds to a bank account previously blocked and released.(1) Restated in light of the changes in accounting policy and presentation explained in Note 1 - Accounting policies and methods


half year Statement of ChangeS in ShareholderS’ equity

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1 Jan

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201

3 b/

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6 81

113

8 00

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27 6

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(13

251)

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1 88

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1 Jan

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4 b/

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1 477

9 90

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1 384

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359

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52 9

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N O T E S T O T H E C O N D E N S E D C O N S O L I D AT E D HALF YEAR FINANCIAL STATEMENTS

Marie Brizard Wine & Spirits (MBWS) is a société ano-nyme (French public limited company) with a Board of Di-rectors incorporated under French law, and subject in par-ticular to the provisions of the French Commercial Code. MBWS shares are listed on Euronext Paris (Compartment B) and the Warsaw Stock Exchange ( WSE). The MBWS Group operates in the wines and spirits sector.

The Group has been the subject of a rehabilitation plan since the Court decision issued on 9 April 2013.

The Company’s registered office is located at 19 Boule-vard Paul Vaillant Couturier, 40 Quai Jean Compagnon, Ivry-sur-Seine (94200), France.

The condensed consolidated financial statements for the six months ended 30 June 2015 were approved by the Board of Directors on 28 September 2015.

The 30 June 2015 General Meeting resolved to change the Company’s name from «Belvédère» to «Marie Brizard Wine & Spirits» and to transfer the registered office to the following address: 19 Boulevard Paul Vaillant Couturier, 40 Quai Jean Compagnon, 94200 Ivry-sur-Seine, France

Note 1. Accounting policies and methods

Note 1.1 Accounting principles and policies applied

The condensed consolidated financial statements of MBWS SA and its subsidiaries (the Group) for the six months ended 30 June 2015 have been prepared in com-pliance with IAS 34 - Interim Financial Reporting and with all standards and interpretations adopted by the European Union that are compulsorily applicable to financial years beginning on or after 1 January 2015.

International accounting standards include IFRS, IAS (International Accounting Standards) and their interpre-tations.

The condensed financial statements do not contain all of the information required by IFRS for the presentation of annual financial statements and should therefore be read in conjunction with the Group annual consolidated financial statements for the year ended 31 December 2014 as pre-sented in the 2014 Annual Financial Report, which may be viewed on the Company website at http://www.mbws.com.

The accounting policies and methods applied to the condensed consolidated financial statements for the six months ended 30 June 2015 are identical to those applied to the consolidated financial statements for the prior year, with the exception of the new accounting standards listed

below.

Standards, interpretations and IFRS amendments adop-ted by the European Union and compulsory from 1 Janua-ry 2015

- IFRS improvements published in December 2013 (2011-2013 cycle)

- IFRIC 21 - Levies

The changes and consequences related to IFRIC 21 are explained in detail in Note 1.2 - Changes in accounting policies.

The other standards compulsory in the European Union from 1 January 2015 had no impact on the Group’s finan-cial statements.

Standards, interpretations and IFRS amendments pu-blished but not yet applicable or applied optionally by the Group

Standards adopted:

- IFRS improvements published in December 2013 (2010-2012 cycle);

- Amendments to IAS 19 - Defined Benefit Plans: Em-ployee Contributions;

Standards not yet adopted:

- IFRS 15 – Revenue from Contracts with Customers;- IFRS 9 – Financial Instruments (a standard intended

to gradually supersede IAS 39);- Amendments to IFRS 10 and IAS 28 – Sales or Contri-

butions of Assets between an Investor and its Associate/Joint Venture;

- Amendments to IAS 16 and IAS 38 – Clarification of Acceptable Methods of Depreciation and Amortisation;

- Amendments to IAS 16 and IAS 41 - Agriculture: Bea-rer Plants;

- Amendments to IFRS 11 – Accounting for Acquisi-tions of Interests in Joint Operations;

- Amendments to IAS 1 - Disclosure Initiative;- IFRS improvements published in September 2014

(2012-2014 cycle).

The potential impact of the application of these new standards and amendments on the financial statements is currently under review.

1.2 Changes in accounting policies

Since 1 January 2015, the Group has applied IFRIC 21 - Levies, an interpretation that defines the date on which a liability related to the payment of a levy or contribution is to be recognised. The triggering event for the recognition of the liability is now the date on which the levy falls due.


Given the retrospective application of IFRIC 21 - Le-vies, the 2013 and 2014 consolidated financial statements have been adjusted accordingly for the purposes of com-parison. The impact of this change in accounting policy is explained further in section 1.7 – Restatement of compara-tive information.

1.3 Presentation changes

For the preparation of the 2014 consolidated financial statements and as part of the drive to harmonise its ac-counting practices, the MBWS Group changed the presen-tation of the following items in its financial statements:

- Revenues: Group revenues are presented net of any discounts and commercial benefits granted. This presenta-tion change only concerns the US subsidiary, which reco-gnised these costs in its external expenses.

- Excise duties: in accordance with the practices of sec-tor peers and to improve comparability, the MBWS Group has added a line item to its income statement showing reve-nues excluding excise duties on volumes sold.

The Group retains in inventory the excise duties paid over the period for products not yet sold and therefore still included in inventory. These duties will be released from inventory when the products are sold over subsequent pe-riods.

This presentation primarily affects the Polish and Li-thuanian entities.

These presentation changes, which have no impact on the MBWS Group’s operating profit/(loss), are set out in section 1.7 of the present Note – Restatement of compara-tive information.

1.4 Underlying valuation principles

The financial statements have been prepared according to the historical cost principle, with the exception of cer-tain asset and liability categories measured at fair value in accordance with the rules imposed by IFRS.

1.5 Use of estimates and assumptions

The preparation of IFRS consolidated financial state-ments requires management to make judgements and es-timates and to use assumptions that affect the accounting principles applied, as well as the valuation of assets, liabi-lities, income and expenses. Such estimates and assump-tions are based on experience and on a set of criteria that Management considers reasonable and realistic, without third parties necessarily being in a position to judge those estimates and assumptions. Actual future results may differ from such estimates.

The underlying estimates and assumptions are reviewed on an ongoing basis. The impacts of such reviews are posted to the accounting period during which the reviews took place or to future accounting periods if applicable.

1.6 Share-based payments

The Group granted stock options and bonus shares to its managers and employees during the first half of 2015.

Pursuant to IFRS 2, these share-based payments are measured at the grant date and recognised under per-sonnel costs over the vesting period. This expense, which represents the fair value of the stock options and bonus shares, is offset by an equivalent increase in shareholders’ equity.

1.7 Restatement of comparative information

The changes in accounting policy and presentation made by the Group for the period ended break down as follows:

See the following page

The impact on the consolidated income statement re-sults from the fact that the total annual expense related to certain levies, mainly in France, is no longer spread over the whole year but fully recognised at the date of the trig-gering or obligating event (usually 1 January).


€000 unless stated otherwise H1 2014reported Excise duty

restatements

Commercial discounts

and benefits US

IFRIC 21 impact

30 June 2014

restated

Gross revenues 330 525 (1 396) 329 129Excise duties (107 759) (107 759)Revenues excluding excise duties 221 370Purchases consumed (163 339) 12 947 (150 392)External charges (34 792) 1 396 (33 396)Personnel costs (30 312) (30 312)Taxes and levies (99 348) 94 812 (751) (5 287)Depreciation charges (3 609) (3 609)Other operating income 6 902 6 902Other operating expenses (5 988) (5 988)Underlying operating profit/(loss) 40 (751) (711)Non-recurring operating income 1 893 1 893Non-recurring operating expenses (3 366) (3 366)Operating profit/(loss) (1 433) (751) (2 184)Net financial income/(expenses) (7 120) (7 120)Profit/(loss) before tax (8 553) (751) (9 304)Income tax (352) 237 (115)Share of earnings of associatesNet profit/(loss) from continuing operations (8 904) (513) (9 417)Net profit/(loss) (8 904) (513) (9 417)Group share (9 142) (504) (9 646)Non-controlling interests 237 (10) 227

€000 unless stated otherwise H1 2013 reported Excise duty

restatements

Commercial discounts

and benefits US

IFRIC 21 impact

30 Juin 2013

restated

Gross revenues 404 134 (1 373) 402 761Excise duties (149 115) (149 115)Revenues excluding excise duties 253 646Purchases consumed (175 525) (1 957) (177 482)External charges (42 363) 1 373 (40 990)Personnel costs (32 702) (32 702)Taxes and levies (155 677) 151 072 (729) (5 334)Depreciation charges (4 119) (4 119)Other operating income 7 042 7 042Other operating expenses (7 691) (7 691)Underlying operating profit/(loss) (6 900) (729) (7 629)Non-recurring operating income 21 742 21 742Non-recurring operating expenses (28 156) (28 156)Operating profit/(loss) (13 314) (729) (14 043)Net financial income/(expenses) 138 812 138 812Profit/(loss) before tax 125 498 (729) 124 769Income tax (2 966) 228 (2 738)Share of earnings of associates 101 101Net profit/(loss) from continuing operations 122 634 (501) 122 133Net profit/(loss) 122 634 (501) 122 133Group share 122 377 (492) 121 886Non-controlling interests 256 (10) 246


Restatement of consolidated balance sheets

The impact on the consolidated balance sheets results from the application of IFRIC 21.

€000 unless stated otherwise 31 December2013

reportedIFRIC

21 impact

31 December2013

restated

31 December2014

reportedIFRIC

21 impact

31 December2014

restated

ASSETSGoodwill 30 646 30 646 29 932 29 932Intangible assets 111 240 111 240 110 900 110 900Property, plant and equipment 51 653 51 653 42 922 42 922Financial assets 5 767 5 767 1 624 1 624Investments in associates 3 089 3 089Deferred tax assets 2 497 (189) 2 308 3 393 (173) 3 220Non-current assets 204 892 (189) 204 703 188 771 (173) 188 597Current assets 328 167 328 167 300 797 300 797Assets held for sale 5 877 5 877Total assets 533 059 (189) 532 870 495 445 (173) 495 272

€000 unless stated otherwise 31 December2013

reportedIFRIC

21 impact

31 December2013

restated

31 December2014

reportedIFRIC

21 impact

31 December2014

restated

LIABILITIESShare capital 52 972 52 972 52 973 52 973Premiums 416 353 416 353 416 359 416 359Consolidated reserves (434 138) 347 (433 791) (244 204) 359 (243 844)Translation reserves (13 968) (13 968) (17 545) (17 545)Consolidated net profit/(loss) 190 260 12 190 272 (19 096) (30) (19 125)Equity capital (Group share) 211 479 359 211 838 188 488 330 188 817Non-controlling interests 9 906 9 906 10 696 10 696Total equity capital 221 385 359 221 744 199 184 330 199 514Employee benefits 5 132 5 132 6 071 6 071Other non-current provisions 7 072 7 072 7 473 7 473Long-term borrowings – due in more than one year 2 353 2 353 2 202 2 202Deferred tax liabilities 40 731 40 731 38 768 38 768Other non-current liabilities 74 346 74 346 64 227 64 227Non-current liabilities 129 634 129 634 118 740 118 740Current provisions 3 523 3 523 3 972 3 972Long-term borrowings – due in less than one year 1 480 1 480 1 112 1 112Short-term borrowings 13 510 13 510 32 321 32 321Trade and other payables 64 310 64 310 56 985 56 985Tax liabilities (946) (548) (1 494) 558 (503) 55Other current liabilities 100 162 100 162 77 813 77 813Current liabilities 182 040 (548) 181 491 172 761 (503) 172 258Liabilities held for sale 4 760 4 760Total liabilities 533 059 (189) 532 870 495 445 (173) 495 272

31/12/2013 31/12/2014


Note 2. Change in consolidation scope

In the first half of 2015 the Group sold off non-strategic and/or loss-making operations in Poland and Belarus, as announced in the strategic plan.

The companies in question are not included in the first half 2015 consolidated financial statements.

In addition, William Pitters International merged with Marie Brizard & Roger International in February 2015.

Note 3. Segment information

The segment financial information is presented along the same lines as the internal reporting used to measure Group performance.

Segment information - income statement

€000 France and international

cluster

Poland Lithuania Bulgaria Other countries

Holding company

Inter-segment

H1 2015

Third party revenues 113 376 190 785 28 756 2 987 12 094 22 348 020Inter-segment revenues 1 884 4 576 601 95 1 903 (9 058)Revenues 115 260 195 361 29 357 3 081 12 094 1 925 (9 058) 348 020Excise duties (106 448) (18 180) (704) (125 332)Revenues excluding excise duties 115 260 88 913 11 177 3 081 11 390 1 925 (9 058) 222 688

Underlying operating profit/(loss) 4 794 (797) 646 (821) 246 (4 969) (902)

Non-recurring income and expenses (1 297)Net financial income/(expenses) (185)Income tax (383)Profit/(loss) (2 767)


cluster


Holding company

Inter-segment

H1 2014restated(1)

Third party revenues 115 364 169 793 27 986 2 250 13 735 1 329 129Inter-segment revenues 591 7 146 97 144 25 (8 004)Revenues 115 955 176 939 28 083 2 394 13 735 26 (8 004) 329 129Excise duties (89 081) (17 936) (742) (107 759)Revenues excluding excise duties 115 955 87 858 10 147 2 394 12 993 26 (8 004) 221 370

Underlying operating profit/(loss) 5 426 (810) 540 (1 029) (2 837) (2 000) (711)

Non-recurring income and expenses (1 473)Net financial income/(expenses) (7 120)Income tax (115)Profit/(loss) (9 417)


cluster


Holding company

Inter-segment

H1 2013restated(1)

Third party revenues 126 097 236 215 22 602 2 870 14 976 1 402 761Inter-segment revenues 1 225 4 983 1 176 236 27 (7 648)Revenues 127 322 241 198 23 778 3 106 14 976 28 (7 648) 402 761Excise duties (133 179) (15 090) (846) (149 115)Revenues excluding excise duties 127 322 108 019 8 688 3 106 14 130 28 (7 648) 253 646

Underlying operating profit/(loss) 3 968 (1 954) 151 (1 022) (1 514) (7 260) (7 629)

Non-recurring income and expenses (6 414)Net financial income/(expenses) 138 812Share of profit and loss of associates 101Income tax (2 738)Profit/(loss) 122 133



Segment information - balance sheet


cluster


Holding company

Inter-segment

30 June 2015


Working capital 41 706 9 883 6 846 (5 618) 3 091 13 203 69 110

Deferred taxes and non-current liabilities (43 571) (16 185) (2 692) 46 (277) (25 313) (87 992)

Capital employed 135 950 24 237 13 762 (3 235) 5 987 (11 277) 165 423



cluster


Holding company

Inter-segment

31 December 2014

restated(1)


Working capital 36 714 3 912 8 100 (6 897) (6 795) 47 726 82 760

Deferred taxes and non-current liabilities (45 640) (20 452) (2 829) 46 286 (31 170) (99 760)

Capital employed 128 682 14 385 13 842 (4 436) (3 110) 17 389 166 753



cluster


Holding company

Inter-segment

31 December 2013

restated(1)


Working capital 53 364 36 941 8 721 (2 317) (10 170) 36 465 123 004

Deferred taxes and non-current liabilities (47 086) (25 573) (2 933) 134 (1 230) (36 081) (112 769)

Capital employed 147 116 46 029 15 124 128 (5 768) 1 146 203 774

Capital expenditure 1 177 1 321 243 1 547 275 3 4 565Depreciation charges (2 746) (3 541) (1 071) (690) (407) (6) (8 461)



Note 4. External charges

First half marketing and promotion expenditure de-creased by €1.6m from first half 2014 mainly due to the deferral of promotion campaigns until the second half of 2015.

Note 5. Personnel costs

The increase in personnel costs is mainly due to the re-cruitment drive carried out chiefly by the holding company since June 2014 and stepped up in January 2015, partly off-set by the impact of restructuring operations in Poland, Belarus and France.

Note 6. Other operating income and expenses

Other operating income and expenses are analysed as follows:

The increase in other external services was mainly due to the increase in fees, largely related to the provision of management services for the implementation of the BiG 2018 strategic plan during first half 2015. In the previous year, most of this expenditure was incurred during the se-cond half.

€000 H1 2015 H1 2014restated(1)

H1 2013restated(1)

Marketing and promotion (6 122) (7 719) (12 834)Rental and maintenance (5 632) (6 611) (7 009)Transport (5 363) (5 250) (6 746)Other external services (17 554) (13 817) (14 401)External charges (34 671) (33 397) (40 990)


€000 H1 2015 H1 2014 H1 2013

Payroll (23 975) (23 003) (24 588)Social security and personal insurance charges (7 641) (7 318) (7 969)Retirement provisions (139) 68 13Other (59) (158)Personnel costs (31 755) (30 312) (32 702)

30 June 2015

30 June 2014

30 June 2013

Total headcount 2 332 2 690 3 074

€000 Income Expenditure H1 2015net

H1 2014net

H1 2013net

Provisions and reversals 4 443 (3 910) 533 1 684 (476)Proceeds from disposals of fixed assets 17 (349)Other operating income and expenses 1 331 (1 919) (588) (786) 177Other operating income and expenses 5 774 (5 829) (55) 915 (648)


Note 7. Non-recurring income and expendi-ture

Non-recurr ing operat ing income and expenditure consist of non-recurring transactions and are excluded from underlying operating profit/(loss) in order to im-prove readability, particularly in terms of drawing compa-risons between the periods presented.

First half 2015 non-recurring income and expenditure comprised:

- €1,329,000 of expenses related to the Group’s debt res-tructuring programme, mainly consisting of fees incurred in connection with various legal proceedings;

Note 8. Net financial income/(expenses)

The cost of debt was stable compared to first half 2014 and consisted mainly of factoring charges and interest on bank borrowings.

Other financial income and expense was primarily af-fected by foreign exchange gains and losses and by the impact of discounting the liabilities declared by creditors (excluding the FRN and bonds with redeemable warrants [OBSAR]) during the implementation of the rehabilitation plan.

- Net restructuring costs mainly incurred in Bulgaria and the US;

- Net proceeds from asset disposals, mainly from the sale of Galerie Alkoholi and Galiart.

The improvement in exchange gains/losses compared to first half 2014 was mainly driven by the positive impact of changes in the dollar exchange rate on MBWS’s euro loan to Imperial Brands.


Restructuring income and expenses 747 (1 201) (454)Gains/losses on asset disposals 952 (448) 504Items related to Group financial restructuring (1 329) (1 329)Other 58 (76) (18)Non-recurring income and expenditure 1 757 (3 054) (1 297)


Non-recurring income and expenditure 1 893 (3 367) (1 474)


Non-recurring income and expenditure 21 743 (28 156) (6 413)


H1 2014net

H1 2013net

Income from cash and cash equivalents 76 76 126 411Interest and similar charges (735) (735) (791) (4 496)Net cost of borrowings 76 (735) (659) (665) (4 085)


H1 2014net

H1 2013net

Provisions and reversals (4 570) 421Exchange gains/losses 6 081 (2 837) 3 244 (587) (686)Discounting effects (2 974) (2 974) (2 549) 28 664Difference between the fair value and book value of the FRN debt 124 821Other financial income and expenses 281 (77) 204 1 251 (10 324)Other financial income and expenses 6 362 (5 888) 475 (6 455) 142 896

Net financial income/(expenses) 6 439 (6 623) (185) (7 120) 138 812


Note 9. Income tax

Note 10. Earnings per share

Net income/(loss) Group share and EPS from conti-nuing operations

Note 11. Goodwill

€000 H1 2015 H1 2014restated(1)

H1 2013restated(1)

Income tax expense (383) (115) (2 738)


€000 unless stated otherwise H1 2015 H1 2014restated(1)

H1 2013restated(1)

Numerator(€000)Net profit/(loss), Group share (3 239) (9 646) 121 886Net profit/(loss) from continuing operations, Group share (3 239) (9 646) 121 886Denominator(number of shares)Number of shares outstanding 26 475 753 26 428 965 12 089 304Number of shares outstanding after dilution 32 425 496 26 428 965 13 931 402Earnings per share (€)Net earnings per share, Group share (€) -0,12 € -0,36 € 10,08 €Diluted net earnings per share, Group share (€) -0,12 € -0,36 € 8,75 €Net earnings per share from continuing operations, Group share (€) -0,12 € -0,36 € 10,08 €

Diluted net earnings per share from continuing operations, Group share (€) -0,12 € -0,36 € 8,75 €


€000 Opening 31/12/2014



Closing 30/06/2015

Gross goodwill: 176 842 11 621 177 474 - France 143 216 143 216 - Poland 31 939 626 32 565 - Ukraine - USA 1 315 1 315 - Other 372 11 (4) 378Impairment: (146 910) (525) (147 435) - France (118 770) (118 770) - Poland (26 787) (525) (27 312) - Ukraine - USA (1 315) (1 315) - Other (38) (38)Net goodwill 29 932 11 97 30 039


The goodwill arose from the historical brand acquisi-tions made by the Group, the most important of which were Marie Brizard and William Peel.

Goodwill impairment tests:

In accordance with IAS 36, Group assets at 30 June 2015 were reviewed in order to identify any cash generating units (CGU) displaying signs of loss of value.

The recoverable value of the CGUs is measured in ac-cordance with the assumptions adopted in the BiG 2018 strategic plan, which are mainly based on expected growth rates for the wines and spirits market and the Group’s abi-lity to achieve the objectives set down in the plan.

Given that no indication of loss of value was identified, no impairment testing was carried out at 30 June 2015 and no additional impairment charges were recorded for the period.

€000 Opening 31/12/2013



Closing 31/12/2014

Gross goodwill: 186 760 (7 483) (1 420) (1 015) 176 842 - France 143 216 143 216 - Poland 41 461 (7 156) (1 361) (1 005) 31 939 - Ukraine 327 (327) - USA 1 315 1 315 - Other 441 (59) (10) 372Impairment: (156 114) 7 020 1 332 852 (146 910) - France (118 770) (118 770) - Poland (35 604) 6 692 1 273 852 (26 787) - Ukraine (327) 327 () - USA (1 315) (1 315) - Other (97) 1 59 (38)Net goodwill 30 646 (463) (88) (163) 29 932

€000 Opening 31/12/2012



Closing 31/12/2013

Gross goodwill: 187 615 (855) 186 760 - France 143 216 143 216 - Poland 42 278 (817) 41 461 - Ukraine 349 (22) 327 - USA 1 315 1 315 - Other 457 (16) 441Impairment: (156 847) 733 (156 114) - France (118 770) (118 770) - Poland (36 306) 702 (35 604) - Ukraine (349) 22 (327) - USA (1 315) (1 315) - Other (107) 10 (97)Net goodwill 30 768 (122) 30 646


Note 12. Trademarks and other intangible assets

Trademarks

At 30 June 2015, the net book value of trademarks was €102,345,000. The principal trademarks valued were the Marie Brizard trademarks acquired by the Group in 2006.

The Zawisza trademark was pledged to a bank as secu-rity for a loan for a residual principal amount of €1,133,000 at 30 June 2015.

Leasehold

Leasehold rights on land in Poland meet the criteria for recognising an intangible asset under IFRS and are amor-tised over the 99-year period of the leasehold.

The net value of the long-term leasehold rights reco-gnised under ‘Other intangible assets’ at 30 June 2015 amounted to €7,459,000.

Impairment tests on trademarks

Given that no indications of loss of value were identi-fied, impairment tests were not performed at 30 June 2015 and the recoverable value of the trademarks was based on the assumptions applied at 31 December 2014.

€000 Opening 31/12/2014


Other changes



Closing 30/06/2015

Concessions and patents 2 244 53 4 2 301Trademarks 138 475 2 35 138 512Other intangible assets 21 031 174 (43) 20 223 21 406Gross 161 750 227 (43) 22 262 162 220 Concessions and patents (591) (44) (4) (638)Trademarks (36 065) (23) (1) (79) (36 167)Other intangible assets (14 195) 43 (61) 2 (84) (14 294)Depreciation and provisions (50 850) 43 (128) 2 (166) (51 100) Net 110 900 227 (128) 24 96 111 119

€000 Opening 31/12/2013


Other changes



Closing 31/12/2014

Concessions and patents 2 257 62 (61) (8) (6) 2 244Trademarks 138 645 (170) 138 475Other intangible assets 21 251 231 (67) (45) (11) (327) 21 031Gross 162 153 292 (128) (53) (11) (503) 161 750 Concessions and patents (642) 61 (18) 3 6 (591)Trademarks (36 147) (33) 115 (36 065)Other intangible assets (14 123) 38 (339) 27 1 202 (14 195)Depreciation and provisions (50 912) 99 (390) 29 1 324 (50 850) Net 111 240 292 (29) (390) (23) (11) (179) 110 900

€000 Opening 31/12/2012


Other changes



Closing 31/12/2013

Concessions and patents 2 348 57 (141) (9) 2 257Trademarks 154 702 (15 674) (383) 138 645Other intangible assets 21 243 275 (41) (226) 21 251Gross 178 294 332 (15 856) (618) 162 153 Concessions and patents (780) 131 8 (642)Trademarks (32 112) (3 976) (58) (36 147)Other intangible assets (13 667) (520) 64 (14 123)Depreciation and provisions (46 560) (4 366) 14 (50 912) Net 131 734 332 (15 856) (4 366) (605) 111 240


Note 13. Property, plant and equipment

Capital expenditure mainly concerned the upgrading and replacement of production equipment in Poland, Li-thuania and Spain.

€000 Opening 31/12/2014


Other changes



Closing 30/06/2015

Land 11 079 (37) 11 042Buildings 86 563 161 (684) 244 429 86 712Plant, machinery and equipment 96 460 549 (964) 239 628 96 913Other PP&E 21 483 1 630 (619) 40 132 22 665PP&E in progress 1 023 880 (150) 4 1 758Gross 216 608 3 220 (2 268) 373 1 157 219 092

Landscaping (1 472) (26) 3 (3) (1 498)Buildings (66 405) 367 (1 198) (25) (303) (67 563)Plant, machinery and equipment (86 366) 800 (1 212) 11 (568) (87 335)Other PP&E (19 138) 480 (493) (1) (78) (19 230)PP&E in progress (304) (14) (318)Depreciation and provisions (173 686) 1 647 (2 942) (12) (953) (175 944) Net 42 922 3 220 (620) (2 942) 361 204 43 148

€000 Opening 31/12/2013


Other changes



Closing 31/12/2014

Land 11 477 166 (49) (483) (32) 11 079Buildings 91 846 626 (578) (3 366) (1 284) (682) 86 563Plant, machinery and equipment 101 589 1 133 (2 219) (326) (2 686) (1 030) 96 460Other PP&E 23 285 2 333 (3 272) (353) (390) (118) 21 483PP&E in progress 992 297 (260) (7) 1 023Gross 229 189 4 555 (6 118) (4 788) (4 360) (1 869) 216 608

Landscaping (1 415) (62) 5 (1 472)Buildings (61 149) 425 (2 958) (3 474) 295 457 (66 405)Plant, machinery and equipment (87 606) 2 149 (3 577) 532 1 247 889 (86 366)Other PP&E (27 045) 1 911 151 5 391 375 78 (19 138)PP&E in progress (321) (2) 19 (304)Depreciation and provisions (177 537) 4 485 (6 448) 2 468 1 917 1 429 (173 686) Net 51 652 4 555 (1 633) (6 448) (2 320) (2 443) (440) 42 922

€000 Opening 31/12/2012


Other changes



Closing 31/12/2013

Land 12 089 4 (337) 3 (281) 11 477Buildings 93 700 278 (1 308) (162) (663) 91 846Plant, machinery and equipment 105 516 1 420 (5 318) 1 070 (1 100) 101 589Other PP&E 28 953 2 158 (6 751) (851) (224) 23 285PP&E in progress 2 888 372 (533) (1 721) (14) 992Gross 243 148 4 233 (14 249) (1 660) (2 282) 229 189

Landscaping (1 319) (98) 2 (1 415)Buildings (59 767) (1 911) 181 348 (61 149)Plant, machinery and equipment (88 044) (227) (87) 767 (87 590)Other PP&E (14 245) (13 039) 65 158 (27 061)PP&E in progress (298) (28) 5 (321)Depreciation and provisions (163 673) (15 303) 159 1 280 (177 537) Net 79 475 4 233 (14 249) (15 303) (1 501) (1 003) 51 652


Note 14. Financial assets

Equity investments:

Equity investments mainly consist of shares in non-ope-rating companies or companies in the process of closure in which the Group no longer has a controlling interest.

€000 Opening 31/12/2014

Acquisitions/increases

Disposals/ decreases

Net charges Other changes



Closing 30/06/2015

Equity investments 18 764 (3) 18 761Other long-term securities 17 17Escrow depositOther investments 33 515 331 (35) 68 33 879Other receivables 11 161 (1) 11 160Gross 63 458 331 (36) 65 63 817

Equity investments (18 740) () (4) (18 744)Other long-term securitiesOther investments (31 937) (45) (31 982)Other receivables (11 157) (4) (11 161)Impairment (61 834) (4) () (48) (61 887)

Net 1 624 331 (36) (4) () 16 1 931

€000 Opening 31/12/2013






Closing 31/12/2014

Equity investments 12 458 6 312 (6) 18 764Other long-term securities 901 (884) 17Escrow deposit 4 031 31 (4 062)Other investments 33 608 224 (280) (130) 94 33 515Other receivables 5 362 1 (82) 5 880 11 161Gross 56 360 256 (4 424) 11 178 88 63 458

Equity investments (12 344) (93) (6 308) 5 (18 740)Other long-term securities (883) 883Other investments (32 005) 131 (63) (31 937)Other receivables (5 362) (4 240) (1 555) (11 157)Impairment (50 594) (4 333) (6 849) (58) (61 834)

Net 5 766 256 (4 424) (4 333) 4 329 30 1 624

€000 Opening 31/12/2012






Closing 31/12/2013

Equity investments 12 480 (26) 8 (4) 12 458Other long-term securities 2 494 (1 534) (59) 901Escrow deposit 3 675 4 031 (3 675) 4 031Other investments 35 946 141 (1 138) (1 306) (36) 33 608Other receivables 5 362 5 362Gross 54 495 4 172 (6 373) 4 064 (99) 56 360

Equity investments (12 127) 26 (239) (8) 4 (12 344)Other long-term securities (1 441) 461 38 59 (883)Other investments (32 026) 21 (32 005)Other receivables (5 362) (5 362)Impairment (45 594) 487 (239) (5 332) 84 (50 594)

Net 8 901 4 172 (5 886) (239) (1 268) (15) 5 766


Note 15. Inventories

Gross inventories increased by €10.9m during the first half of 2015. This increase, which mainly affected France, is due to seasonal stocking up in readiness for summer sales, particularly of the Fruits and Wine range.

Compared to 30 June 2014, inventories decreased by €12.0m thanks to optimisation measures implemented over the past year.

Note 16. Trade receivables

Some Group companies, primarily in France and Po-land, have signed direct “reverse factoring agreements” with their main customers, in order to optimise their trade receivables item and boost the performance of their key operating working capital indicators.

Gross trade receivables decreased by €3.7m over the first half of 2015, mainly due to working capital control mea-sures implemented by the Group in 2014.

Net trade receivables were down €6.6m compared to 30 June 2014.

Some factoring agreements in place in France and Po-land meet the deconsolidation conditions specified by IAS 39; the assigned trade receivables are not shown under ba-lance sheet assets. Proceeds from the transfer of receivables not due at 30 June 2015 amounted to €19.5 million.

€000 30 June2015

31 December 2014

31 December 2013

Raw materials 29 947 26 500 28 180Work in progress 6 026 5 062 6 603Semi-finished and finished goods 27 344 17 946 16 657Traded goods 26 330 29 265 56 584Gross 89 647 78 773 108 024 Raw materials (2 502) (2 535) (2 918)Work in progress (32) (33) (1 433)Semi-finished and finished goods (440) (583) (419)Traded goods (5 842) (5 527) (3 058)Impairment (8 815) (8 678) (7 828)

Net 80 831 70 095 100 196

€000 30 June2015

31 December 2014

31 December 2013

Trade receivables 105 904 109 641 153 956Impairment (10 804) (10 659) (19 601)Net trade receivables 95 100 98 982 134 355


Note 17. Other current assets

Note 18. Cash & cash equivalents

An analysis of the change in cash and cash equivalents over first half 2015 is provided in the cash flow statement.

Note 19. Shareholders’ equity

Note 19.1 Breakdown of share capital and dilu-ting instruments

Cash and cash equivalents increased by €43.8m com-pared to 30 June 2014 and amounted to €69.0m at the end of the period.

€000 30 June2015

31 December 2014

31 December 2013

Advances and payments on account 3 917 2 706 2 977Tax and employee receivables 14 151 10 414 15 937Derivatives 1 450 224 1Short-term deposits 411 818 647Other receivables 15 631 15 790 14 595Gross 35 560 29 952 34 157

Other receivables (8 536) (8 579) (8 288)Impairment (8 536) (8 579) (8 288)

Net 27 024 21 373 25 869

€000 30 June2015

31 December 2014

31 December 2013

Cash equivalents 21 951 2 860 10 615Cash 47 044 74 324 25 856Cash and cash equivalents 68 995 77 184 36 471

30 June2015

31 December 2014

31 December 2013

Share capital (€) 52 973 274 52 972 964 52 972 426Number of shares 26 486 637 26 486 482 26 486 213Par value (€) 2 2 2

Treasury sharesNumber of shares 3 437 7 123 3 437

30 June2015

31 December 2014

31 December 2013

Number of shares comprising share capital 26 486 637 26 486 482 26 486 213Potential dilution from BSA 2004 / 'BSAR1' 643 788 643 788 643 788Potential dilution from BSAR 2006 / 'BSAR2' 99 521 99 521 99 521Potential dilution from BSA Actionnaires 1 1 316 763 1 316 852 1 317 116Potential dilution from BSA Actionnaires 2 1 317 579 1 317 650 1 317 655Potential dilution from BSA OS 2 572 093 2 572 093 2 572 093Potential bonus shares issued 9 320Potential exercise of stock options 480 000Potential number of shares 32 925 701 32 436 386 32 436 386

Share capital in euros (par value of €2) 52 973 274 52 972 964 52 972 426


Note 19.2 Share-based payments

On 12 March 2015, pursuant to the authorisat ion granted by the 16 September 2014 General Meeting of shareholders, the MBWS Board of Directors resolved to grant 9,320 bonus shares and 480,000 stock options to par-ticular Group managers and employees.

The Group recorded a €295,000 expense in respect of stock option and bonus share plans in place at 30 June 2015, with an offsetting credit entry under shareholders’ equity.

Expenses related to share-based payments

Note 20. Employee benefits

The Group’s commitments relate to one-off retirement compensation, disability and death annuities (Poland), and long-service awards (or anniversary bonuses in Po-land). These defined benefit schemes are accounted for in accordance with revised IAS 19.

The three main countries concerned by employee bene-fits are France, Poland and Spain.

At 30 June 2015 the commitments amounted to €6,260,000.

Note 21. Provisions

€000 unless otherwise stated

Initial number of options or shares

granted

Initial fair value H1 2015expense

12 March 2015 allotment:Stock options 480 000 363 (280)Bonus shares 9 320 102 (15)

Total 489 320 465 (295)

€000 Opening 31/12/2014

Charges Reversal(prov. used)

Reversal(prov. not

used)

Other changes Change in consolidation


Closing 30/06/2015

Provisions for pensions and employee benefits(see Note 20)

6 071 175 (35) 3 47 6 260

Social security provisions 2 119 (747) (170) 1 202Tax provisions 3 627 3 627Other non-current provisions 1 726 (383) (121) (3) 1 219Total other non-current provisions 7 473 (1 130) (291) (3) 6 048

Social security – due in < 1 year 3 829 1 347 (1 286) (436) (103) (26) 3 325Other provisions – due in < 1 year 143 22 (101) 394 7 465Current provisions 3 972 1 369 (1 387) (436) 291 (19) 3 790


Tax provisions:

Tax provisions have primarily been recognised at the MBWS and Marie Brizard & Roger International entities. The dispute with the tax authorities relates to the audits on corporation tax, VAT and other levies for the period between 1 January 2006 and 31 December 2007. These tax audits are set out in Note 26 – Disputes and contingent liabilities.

Note 22. Borrowings

Analysis of borrowings by type and maturity

Social security provisions:

Social security provisions (current and non-current) amounted to €4.5 million at 30 June 2015 and relate mostly to employment disputes.

(€000) Opening 31/12/2013


Reversal(prov. not

used)



Closing 31/12/2014

Provisions for pensions and employee benefits 5 132 540 (286) 751 (67) 6 071

Social security provisions 2 813 1 717 (1 403) (1 008) 2 119Tax provisions 3 627 3 627Other non-current provisions 632 1 286 (192) 1 726Total other non-current provisions 7 072 3 003 (1 403) (1 008) (192) 7 473

Social security – due in < 1 year 3 380 2 014 (697) (1 082) 261 (47) 3 829Other provisions – due in < 1 year 143 143Current provisions 3 523 2 014 (697) (1 082) 261 (47) 3 972

€000 Opening 31/12/2012


Reversal(prov. not

used)



Closing 31/12/2013

Provisions for pensions and employee benefits 5 510 616 (666) (283) (46) 5 132

Social security provisions 160 2 710 (57) 2 813Tax provisions 8 765 (2 591) (2 525) (22) 3 627Other non-current provisions 729 122 (299) 91 (11) 632Total other non-current provisions 9 654 2 832 (2 947) (2 434) (33) 7 072

Social security – due in < 1 year 2 797 1 807 (1 170) (54) 3 380Other provisions – due in < 1 year 9 285 (9 132) (2) (8) 143Current provisions 12 082 1 807 (10 302) (2) (62) 3 523

€000 30 June2015

< 1 year 1-5 years

Bank loans 2 554 1 057 1 497Accrued interest on loans 18 18Long-term borrowings 2 572 1 075 1 497


€000 31 December 2014

< 1 year 1-5 years



€000 31 December 2013

< 1 year 1-5 years

Bank loans 3 833 1 480 2 353Accrued interest on loans 1Long-term borrowings 3 834 1 480 2 353



Change in borrowings

Breakdown of borrowings by currency

€000 Bonds Accrued interest on

OBSAR convertible

bonds

Bonds Bank loans Accrued interest on

loans

Long-term borrowings

31 December 2012 407 519 6 637 414 156 11 548 117 869 543 573New loans 810 810Repayments (2 591) (2 591) (6 853) (9 444)Net change (33) 4 774 4 741Exercises of BSAR 2 warrants (conversion into equity)

(2 041) (2 041) (2 041)

Conversion of FRN bonds (336 041) (336 041) (102 965) (439 006)Conversion of OBSAR bonds (66 846) (6 637) (73 483) (19 678) (93 161)Reclassification as BSA frozen liability (1 587) (1 587)Translation differences (52) (52)31 December 2013 3 833 1 3 834New loans 1 358 19 1 377Repayments (1 596) (1 596)Reclassifications (265) (265)Translation differences (36) (36)31 December 2014 3 294 19 3 313New loans 226 28 254Repayments (1 249) (1 249)Reclassifications 329 (29) 300Translation differences (45) (45)30 June 2015 2 554 18 2 572

€000 30 June2015

Euros Polishzlotys

Lithuanianlitas (*)

Othercurrencies


Short-term lines of credit 27 686 22 397 5 281 8

€000 31 December 2014

Euros Polishzlotys

Lithuanianlitas (*)

Othercurrencies

Bank loans 3 294 1 070 1 389 836Accrued interest on loans 19 19Long-term borrowings 3 313 1 070 1 389 836 19

Short-term lines of credit 32 321 23 493 4 699 4 126 4

€000 31 December 2013

Euros Polishzlotys

Lithuanianlitas (*)

Othercurrencies

Bank loans 3 833 1 528 378 1 608 319Accrued interest on loans 1 1Long-term borrowings 3 834 1 528 378 1 608 320

Short-term lines of credit 13 510 6 599 1 466 5 291 154(*) currencies pegged to the Euro


Analysis of borrowings by rate type

Note 23. Risk management

Liquidity risk

Since the launch of the rehabilitation plan approved by the Dijon Commercial Court in its 19 March 2013 ruling, the Group’s debt has fallen sharply, thereby considerably reducing exposure to over-indebtedness.

The MBWS Group has announced that it paid the plan’s administrator, Mr Fréderic Abitbol, the amounts of the se-cond dividends payable on 19 March 2015 for the seven Group companies involved (MBWS SA, Marie Brizard & Roger International SA, Sobieski sp. z o.o., Destylarnia Sobieski SA, Sobieski Trade sp. z o.o., Domain Menada sp. z o.o. and Fabryka Wodek Polmos Lancut SA).

Repayment of Moncigale’s frozen debt has also been de-ferred based on a future repayment schedule. The second Moncigale dividend was paid to Mr Torelli, the plan admi-nistrator, in April 2015.

Since 2014, the Group has used cash flow forecasts, up-dated on a monthly basis, together with operating plans that allow it to anticipate and guarantee its ability to settle each rehabilitation plan instalment.

Group cash and cash equivalents amounted to €69.0m at 30 June 2015 compared to €25.2m at 30 June 2014. The Group’s financing arrangements also include short-term l ines of credit and factoring agreements. The MBWS Group has carried out a review of its liquidity risk and considers that it is in a position to honour its future ins-talments.

Risk relating to shares and other financial investments

The Group has no financial investments likely to be ex-posed to the risk of price fluctuations.

Credit risk

In general, the Group’s customers are diversified, so there is no significant risk linked to dependence on parti-cular customers.

€000 30 June2015

Fixed rate Floating rate

Bank loans 2 554 499 2 055Accrued interest on loans 18 18Long-term borrowings 2 572 517 2 055

Short-term lines of credit 27 686 21 27 665

€000 31 December 2014


Bank loans 3 294 956 2 338Accrued interest on loans 19 19Long-term borrowings 3 313 975 2 338

Short-term lines of credit 32 321 32 321

€000 31 December 2013



Short-term lines of credit 13 510 727 12 783


Note 24. Other liabilities

Other non-current liabilities

In March and April 2013 the competent commercial courts approved rehabilitation plans in respect of nine Group companies. Under these plans, the liabilities clai-med by creditors who have not opted for immediate part payment (excluding FRN and OBSAR debt) are defer-red and paid over 6 to 10 years depending on the creditor concerned.

Material changes made to the terms of the debt include the write-off of existing debt and issue of new debt. The new debt is stated in the balance sheet at fair value as at the date when the plans were approved and is recorded at the outstanding balance under the effective interest rate me-thod. The fair value of the new debt has been determined by calculating the discounted total of future repayments as at the date when the former debt was written off.

Other current liabilities

Note 25. Cash flow statement

Operating working capital 1 (inventories, trade recei-vables/payables)

Operating working capital increased by €5.2m between 31 December 2014 and 30 June 2015.

On the other hand, compared to 30 June 2014 opera-ting working capital improved by €21.7m due to sharp decreases in ‘Inventories’ (down €12.0m) and ‘Trade recei-vables’ (€6.6m).

The dividend instalments payable within one year were classified under current liabilities in accordance with the origin of the liabilities, while the fair value of the estimated future instalments was classified under non-current liabi-lities.

The main initiatives implemented were: - Global negotiations on customer payment terms; - The signing of factoring agreements; - The streamlining of the invoicing process through di-

gitisation; - The introduction of a credit management tool;- Inventory optimisation; - Renegotiation of supplier payment terms.

€000 30 June 2015

31 December 2014

31 December 2013

LT portion of frozen liabilities (rehabilitation plan) 50 801 61 749 71 531Investment subsidies 2 330 2 465 2 788Other 13 26Other non-current liabilities 53 131 64 227 74 346

Breakdown of other current liabilities:

€000 30 June 2015

31 December 2014

31 December 2013

Advances and down payments received 1 667 1 380 1 611Tax and social security payables (incl. excise duty) 42 629 55 114 73 464Investment subsidies 54 54 54Deferred income 1 207 1 191 1 321Other payables 25 598 20 074 23 712Other current liabilities 71 155 77 813 100 162


Note 26. Assets pledged as security and off-balance sheet commitments

Summary of assets pledged as security

Off-balance sheet commitments

- Alcohol duty deposits

In some countries where Group subsidiaries operate (namely France, Poland, Lithuania and Denmark), depo-sits must be paid to Customs as security for payment of excise duties on alcohol. These deposits are generally paid in by insurance companies and banks on behalf of the sub-sidiaries concerned.

In Poland, the maximum deposit paid to date to cus-toms to secure payment of excise duties amounted to €156m.

- Long-term purchase commitments

Cognac Gautier has contracted five-year commitments to purchase cognac raw materials.

Marie Brizard & Roger International has contracted five-year commitments to purchase whisky raw materials.

Moncigale has entered into three-year commitments to purchase wine.

Commitments to purchase vodka have been entered into in Poland.

Country Nature of obligation Nature of assets Asset book value per consolidated

balance sheet (€000)

30 June 2015

France Long-term bank loan (€1,133,000 principal) Zawisza trademark n/a

Deposit from MBRI to BVD creditor Bonny Mellon 12 632

Poland Loan granted to Sobieski sp. z o.o. Operating receivables, current account deposit 12 884

Long-term loans ING bank Slaski Property, operating receivables and trademarks 5 681

Security granted to Customs for excise duty (€156m)

Liability guarantee agreement (€477,200) between Sobieski Trade and Carrefour on sale of Galerie Alkoholi sp. z o.o.

Lithuania Line of credit Property, warehouse, inventories, operating receivables, current account deposit, right to use the Sobieski trademark in Vilnius

21 798

Denmark Line of credit Inventories 437

€000 30 June2015

< 1 year 1 to 3 years > 3 years

Commitments relating to issuer's operating activitiesCommitment to purchase raw materials 195 056 60 218 90 713 44 126

€000 30 June 2015

Commitments relating to issuer's operating activitiesLease agreements 7 419


- Commitment to Krzysztof Trylinski

Krzysztof Trylinski benefits from a guarantee, which provides that the Company will compensate him for any personal loss that may result from the consequences of the signing of a memorandum of agreement between MBWS and Angostura Holdings Limited on 4 February 2013. This guarantee was granted for a period of 10 years from 11 Fe-bruary 2013.

Tax audits in France

MBWS SA together with the other tax group companies were the subject of an accounting audit for tax purposes that began on 19 January 2009. For most of the compa-nies concerned, the audit covers corporation tax, VAT and other taxes for the period from 1 January 2006 until 31 De-cember 2007.

The total amount of these adjustments is around €25.4m (including surcharges and late payment interest), inclu-ding €17.9m of corporation tax, €6.7m of withholding tax, €0.6m of corporation tax social security contributions and €0.2m of VAT.

The main reason for the adjustment is the rejection of the deduction of interest relating to a €375m loan issued in the form of transferable floating-rate notes, or “FRNs”. This agreement, which was entered into on 24 May 2006, is governed by the law of New York State.

Amongst the proposed adjustments, the increases re-lated to FRN interest amount to €15.8m for 2006 and to €28.1m for 2007. These adjustments resulted in additio-nal corporation tax (excluding late payment interest) of €15.1m for 2006 and 2007, as well as additional withhol-ding tax of €5.3m for 2006.

A recovery notice for this tax was issued in April 2012.

These adjustments were disputed via claims, including a request for deferred payment, and then via applications instituting proceedings in the Montreuil Administrative Court.

The Montreuil Administrative Court rejected the appli-cation submitted by MBWS via two judgments issued on 29 December 2014.

MBWS SA appealed both judgments via two appeals lodged at the Versailles Administrative Appeal Court on 25 February 2015.

If it is confirmed, the tax receivable will need to be sett-led as part of the rehabilitation plan approved by the Dijon Commercial Court. As matters stand, MBWS believes that no plan dividend can be paid to the tax authorities while these receivables remain contested and have not been sub-ject to a final ruling.

In view of the foregoing and MBWS’s confidence in the favourable outcome of this dispute, no provision has been recorded in this regard. A provision of €3.5m is still recorded on the balance sheet for the other adjustment items.

In the event that its appeal is rejected by the Versailles Administrative Appeal Court, the Group will be required to pay the amounts due in connection with the aforemen-tioned adjustments relating to 2006 and 2007. In addition, the Group may be required to repay the amounts received in connection with the 2008 carry-back, i.e. €10.4m. Lastly, in the event that the deduction of the FRN interest for the subsequent financial years is ruled out, the corresponding adjustments would reduce the French tax group’s tax-loss carry-forward.

As mentioned earlier, on 26 February 2015 MBWS re-ceived repayment of a €31m carry-back receivable after its request had been approved.

Commercial dispute

On 17 August 2010, Moncigale, an indirect subsidiary of MBWS, signed a ten-year exclusive licensing agreement with Chamarré for the use, production and distribution of the «Chamarré» brand of still wine. Under this agreement, Moncigale agreed to pay Chamarré an annual fee indexed to the volumes sold and revenues generated by products sold under the Chamarré trademark. Under the agreement, Moncigale is required to pay Chamarré a guaranteed mini-mum annual fee.

On 16 June 2011, the Nîmes Commercial Court insti-tuted safeguard proceedings in favour of Moncigale. These proceedings were converted into rehabilitation procee-dings through a ruling issued on 21 September 2011 by the same Court. The Court assigned an administrator to assist the Company in all of its management operations.

On 9 November 2011, the Administrator informed Cha-marré of the termination of this agreement pursuant to the provisions of Article L 622-13 of the French Commercial Code.

On 30 August 2011, in connection with the rehabilita-tion proceedings instituted in favour of Moncigale and the assessment of liabilities carried out at the opening date of the proceedings, Chamarré filed a notice of claim with the creditors’ representative for the amount of €10.7m, corres-ponding to the total amount of guaranteed fees over the ten-year period of the agreement and an estimate of the other related liabilities.

On 6 December 2011, Chamarré fi led an additional «claim for damages» in the amount of €20m, following no-tification of the termination of the agreement.

These statements of receivables were disputed by the


company, and were stayed by the Nîmes Commercial Court pending the decision of the Paris Commercial Court. A lawsuit was brought by the court liquidator of Chamarré before the Paris Commercial Court against the officials in charge of the Moncigale insolvency proceedings via a sum-mons dated 8 February 2013.

Chamarré was placed under rehabilitation proceedings on 31 May 2012, and its entry into liquidation proceedings was announced on 5 June 2012.

At the same time as this first lawsuit, on 29 May 2013, the Moncigale Plan Executor, Mr Torelli , addressed an application to the Nîmes Commercial Court and to the French Public Prosecutor requesting the cancellation of the Moncigale rehabilitation plan and the institution of compulsory liquidation proceedings against Moncigale for non-execution of the plan.

The application stated that the plan, as adopted by the 16 April 2013 ruling, had not been complied with because the company had not paid a monthly amount based on the accepted and contested liability, as provided for in the ru-ling.

The Nîmes Commercial Court ruled on this claim on 21 August 2013 by suspending judgement pending the outco-me to the Chamarré case.

In a judgement dated 6 February 2014, the Paris Com-mercial Court ruled that it did not have the appropriate jurisdiction; as this ruling has now become final, the case will now be heard in the Nîmes Commercial Court. The hearing initially scheduled for 9 April 2014 was deferred to 2 July 2014, then 17 September 2014, then 24 June 2015 and finally to 9 October 2015.

Dispute with Mr Alain-Dominique Perrin and Vermots Finance

A summons dated 22 February 2013 was served on the following companies by bailiff on behalf of Mr Alain-Do-minique Perrin and Vermots Finance, to appear before the Dijon Commercial Court:

(i) The Company, SCP Valliot-Le Guernevé-Abitbol, Equitis Gestion and SVI, for the specific purpose of (a) establishing the manifestly illegal nuisance caused by the exercise of the voting rights attached to 267,848 shares by Equitis Gestion at the Extraordinary General Meeting held on 12 February 2013, pursuant to a trust agreement dated 4 February 2013, (b) otherwise, establishing the imminent harm that would result from the exercise of said voting rights by Equitis Gestion, and (c) suspending the exercise of the voting rights attached to the 267,848 shares for as long as these were held by Equitis Gestion, as a preventive measure;

(ii) T h e C o m p a n y a n d S C P Va l l i o t - L e G u e r n e -

vé-Abitbol, specifically for the purpose of having an ad-ministrator appointed by the Court to verify the legality of the counting of postal votes and proxies and to perform the duties assigned by law, the regulations and the Articles of Association to the officers presiding over the Company’s Extraordinary General Meeting convened for the second time on 28 February 2013.

In orders handed down on 26 February 2013, the Presi-ding Judge of the Dijon Commercial Court dismissed their applications and ordered them, under the terms of each of the orders, to pay the sum of 5,000 euros to the Company and SCP Valliot-Le Guernevé-Abitbol as damages for fri-volous prosecution.

In statements dated 22 March 2013, Mr Alain-Domi-nique Perrin and Vermots Finance appealed the orders is-sued on 26 February 2013 by the Presiding Judge of the Dijon Commercial Court.

Following the oral arguments hearing before the Dijon Court of Appeal on 10 April 2014, the matter was placed under advisement and the verdict is to be announced on 12 June 2014.

On 16 April 2015, the Senior Presiding Judge in the Court of Cassation noted the lapse of the appeals lodged by Vermots Finance against the two rulings issued by the Dijon Court of Appeal on 12 June 2014, due to its failure to submit pleadings within the legal timeframe.

Dispute with the French Financial Markets Authority (AMF)

A lawsuit was launched by the AMF Sanctions Commis-sion against the Company for breach of its public repor-ting duties and failure to disclose transactions in its own shares and the crossing of shareholding thresholds, and against Sobieski SARL and SVI for failure to disclose tran-sactions in the Company’s shares. The Company, Sobieski SARL and SVI contested these claims.

By a ruling dated 30 April 2014, the AMF Sanctions Commission upheld the claims made against MBWS, So-bieski SARL and SVI, ordered them to pay fines amoun-ting to €150,000, €45,000 and €15,000 respectively and, in accordance with current practice, ordered the ruling to be published. A copy of the ruling may be consulted on the AMF website.

All three subsidiaries appealed against this ruling and proceedings are currently pending before the Paris Court of Appeal. The appeal is scheduled to be heard in the Paris Court of Appeal on 14 January 2016.

A provision was recorded in the first half 2015 financial statements for the full amount of the aforementioned fines.


Krupnik dispute

Proceedings for unfair competit ion were init iated by Destylarnia Sobieski, the Group’s Polish subsidiary, against Toorank Polska sp. z o.o. on the grounds of the illegal use of the Krupnik trademark by the latter.

In fact, this subsidiary has produced, sold and distri-buted a honey-based liqueur under the Krupnik trademark for many years, with considerable success.

Having observed that Toorank Polska was using the Krupnik trademark, it sent that company a letter of notice summoning it to cease such illegal use, which remained wi-thout effect.

The subsidiary consequently decided to institute legal proceedings on the grounds of unfair competition, relying on the recognition that the Krupnik trademark has earned on the Polish market.

In response, Toorank Polska argued that the Krupnik word mark registered in Destylarnia Sobieski’s name since 1997 was invalid, claiming that the fact that this word is the sales name for a honey-based liqueur in the Polish lan-guage, and was devoid of any distinctive features, meant that it could not be the subject of an exclusive right bene-fiting Destylarnia Sobieski via registration as a trademark.

The Polish Trademark Office upheld Toorank Polska’s arguments and so cancelled the registration of the Krupnik word mark in a decision dated 3 October 2012. This deci-sion was the subject of an appeal that confirmed its terms, and then of an appeal to the Polish Supreme Administra-tive Court, which overturned the appeal; the invalidity of the trademark must therefore be considered as final.

Notwithstanding, this decision is unlikely to have any impact on the proceedings launched by the subsidiary, which were based on the charge, not of counterfeiting, but of unfair competition; these proceedings are still in pro-gress.

It is also worth noting that the Krupnik trademark com-bined with graphic designs has been the subject of sepa-rate filings both in Poland and abroad; the validity of these filings, which relates to the presence of said original visual components, is not likely to be contested.

Lastly, the cancellation of this word mark does not prevent the subsidiar y from continuing to market its Krupnik vodka, which carries a label that is particularly well known in Poland and other European markets.

Bulgaria dispute

At the end of November 2014, the Sofia City Court in Bulgaria decided to place the Bulgarian subsidiaries Belve-dere Distribution and Domain Menada under the authority

of a provisional administrator instead of the local mana-gement team, on highly questionable grounds and with the support of a magistrate who is subject to disciplinary proceedings.

Following numerous legal proceedings and diplomatic and media interventions, MBWS regained its rights in Ja-nuary 2015, and the local management team was able to return to managing the subsidiaries in question and regain free access to the premises.

On 5 August 2015 the Court dismissed the application for insolvency proceedings to be instituted against Domain Menada and Belvedere Distribution. The plaintiff did not appeal against this ruling during the statutory time period, which expired on 16 September 2015.

As a reminder, operations in Bulgaria account for less than 1% of the Group’s revenues and total consolidated ba-lance sheet. MBWS intends to take all necessary steps to obtain compensation for the losses sustained in Bulgaria.

Ukraine dispute

MBWS’s Ukrainian subsidiary, Belveder Ukraine LLC, was placed in court-ordered liquidation in January 2014, on the basis of a ruling handed down by the Kiev Commer-cial Court following proceedings instituted at the request of one of the company’s creditors in July 2011.

MBWS holds around 85% of Belveder Ukraine LLC’s overall debt.

Belveder Ukraine LLC’s assets (including both shares in the subsidiaries owned by the company in liquidation and assets belonging to its subsidiaries, which are now controlled by the liquidator appointed by the Kiev Com-mercial Court) were transferred to a third party outside the Company’s control in November 2014.

Following several proceedings initiated by the Com-pany, the Kiev Court upheld the Company’s claims in ear-ly April 2015, and (i) overturned the sale of its assets in Ukraine, which took place in November 2014, and (ii) or-dered the liquidation proceedings to be reopened.

On 16 September 2015, the Kiev Commercial Court’s court of appeal overturned the sale by auction of the Com-pany’s assets in Ukraine. This ruling may be appealed wit-hin 20 days.

Note 28. Post-balance sheet events

Crossing of shareholding threshold by Alken Luxem-bourg

By a letter received on 14 September 2015, Alken Luxembourg, a public limited company governed by the


laws of Luxembourg, registered at 16, rue Jean-Pierre Bras-seur, L-1258 Luxembourg, stated that on 8 September 2015 it had exceeded the threshold of 2.5% of MBWS SA’s share capital and voting rights and that it held 707,644 MBWS shares representing the same number of voting rights, i.e. 2.65% of the Company’s voting rights.

4.4 Statutory Auditors’ re-port on the H1 2015 financial statements


In compliance with the assignment entrusted to us by your Shareholder’s Meetings and in accordance with ar-ticle L. 451-1-2 III of the French monetary and financial code (Code monétaire et financier), we hereby report to you on:

- our review of the accompanying condensed half-yearly consolidated financial statements of Marie Brizard Wine & Spirits S.A. (formerly Belvédère), for the period from January 1st to June 30th, 2015; and

- the ver i f ication of information contained in the half-yearly management report.

These condensed half-yearly consolidated financial sta-tements are the responsibility of the Board of Directors. Our role is to express a conclusion on these financial state-ments based on our review.

I - Conclusion on the financial statements

We conducted our review in accordance with professio-nal standards applicable in France. A review of half-yearly financial information consists in making inquiries, prima-rily of persons responsible for financial and accounting matters, and applying analytical and other review proce-dures. A review is substantially less in scope than an au-dit conducted in accordance with professional standards applicable in France and consequently does not enable us to obtain assurance that the financial statements, taken as a whole, are free from material misstatements, as we would not become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed half-yearly consolidated financial statements are not pre-pared, in all material respects, in accordance with IAS 34 – standard of the IFRSs as adopted by the European Union applicable to interim financial information.

Without qualifying our conclusion, we draw your at-tention to the matter set out in Note 27 “Litigations and contingent liabilities” to the condensed half-yearly conso-lidated financial statements regarding the main litiga-tions and contingent liabilities, in particular the litigation between several of the Group entities and the tax authori-ties.

II - Specific verification

We have also verified the information presented in the half-yearly management report on the condensed half-year-ly consolidated financial statements subject to our review.

We have no matters to report as to its fair presentation and consistency with the condensed half-yearly consoli-dated financial statements.

Paris-La Défense, September 29, 2015


KPMG S.A. Eric ROPERT Partner

Stéphane DEVIN Partner

MAZARS Romain MAUDRY Partner

Dominique MULLER Partner


5.1 Chairman’s report on cor-porate governance and in-ternal control


Pursuant to the provisions of paragraph 6 of Article L. 225-37 of the French Commercial Code, we hereby account to you on the following matters at the end of this report, in accordance with Articles L. 225-100, L. 225-102, L. 225-102-1 and L. 223-26 of said Code:

- the adoption of the Corporate Governance Code;

- the composition of the Board of Directors, and the condi-tions for preparing and organising the work performed by your Board of Directors;

- the control and risk management procedures implemented by the Company;

- the limits that your Board has set on the powers of the Chief Executive Officer;

- the specific terms and conditions relating to the attendance of shareholders at General Meetings; and

GOVERNANCE AND INTERNAL CONTROL

5- the principles and rules approved in order to determine the

remuneration and benefits of any kind granted to corporate of-ficers.

In addition, it is specified that the information provided for in Article L. 225-100-3 of the French Commercial Code regarding the factors likely to have an impact in the event of a public tender offer are set out in the Management Report for the financial year ended 31 December 2014.

5.1.1 Corporate Governance Code

With regard to corporate governance, the Company re-fers to the AFEP-MEDEF Corporate Governance Code, which may be consulted on the MEDEF website (www.medef.fr).

The Company is committed to implementing the AFEP-MEDEF recommendations. Accordingly, in 2014 the Company amended the internal rules that determine the guiding principles for the Company’s operation and that of the special committees.

The following table gives details of the reasons for the Com-pany’s failure to apply certain recommendations in the AFEP-ME-DEF Code on a provisional basis, while the other recommenda-tions of the Code are duly complied with.


reaSonS for the Company’S failure to apply Certain reCommandation in the afep-medef Code

Recommendation AFEP-MEDEF Code article Reasons for failure to apply recommendation

Further information regarding the assessment of the Company’s Board of Directors:

Article 4.2 of the internal rules of the Company’s Board of Directors, updated by the Board of Directors on 10 October 2014, provides that “once a year the Board will include an item on its agenda regarding a discussion of its operation”. A formal assessment is carried out every three years. This review also implies a review of the special committees set up by the Board”.

- operating procedures of the Board of Directors

- preparation and discussion of important issues

- effective contribution of each member of the Board of Directors

Jean-Noël Reynaud’s performance as the Company's Chief Executive Officer is assessed by the Appointments and Remuneration Committee, in accordance with Article 6 of the Board of Directors' internal rules. Given Benoît Hérault’s recent appointment as the Chairman of the Board of Directors, his performance was not assessed in 2014.

Article 13 of the Company’s Articles of Association provides for Directors to be appointed for a six-year term, in accordance with Article L. 225-18 of the French Commercial Code.As part of the overall restructuring of the Belvédère Group that has been carried out since 2014, the Company decided that it was in its interests to stabilise its management bodies and not to alter directors' terms of office.

The independent directors on the Company’s Board of Directors showed their support for the “2018 BiG Plan” by purchasing shares in the Company on 13 March 2015, in the following proportions: (i) Constance Benqué purchased 513 shares; (ii) Christine Mondollot purchased 412 shares; (iii) Benoît Hérault purchased 871 shares; and (iv) Benoît Ghiot purchased 1,000 shares.

In addition, the following directors have stated that they currently hold the following number of shares:

(i) Jacques Bourbousson: 2 shares;(ii) Mehdi Bouchaara: 25 shares; and(iii) Rita Maria Zniber: 1,300 shares.

The Board of Directors also includes two non-independent directors (Rita Maria Zniber and Mehdi Bouchaara) as well as a permanent guest (Serge Heringer), appointed on the recommendation of the company Diana Holding.

Principles for determining the remuneration of corporate executive officers

Article 23.1

The principle of completeness whereby the remuneration of managers and corporate officers may be determined is not complied with, insofar as the variable portion of said remuneration is not mentioned. *

* : Additional information on that top ic is disclosed within paragraph 2.7.2 b is

An assessment of the Board of Directors will be carried out once a year following the 28 April 2015 Board of Directors meeting.

Regular meeting of non-executive directors to issue an assessment of the corporate officers’ performance

Article 10.4

Article 14

Ownership of shares in the Company by Directors

Article 10.2 Owing to the redefinition of the Belvédère Group’s organisational structure and the change in the governance system that occurred during the year, an assessment of the Board of Directors for the year 2014 could not be carried out. Accordingly, at its 28 April 2015 meeting the Board of Directors agreed to carry out a formal assessment during the year.

Information regarding directors’ terms of office, including where such term exceeds four years

Article 20


5.1.2 Composition of the Board of Directors, and conditions for preparing and organising the work performed by your Board of Direc-tors

Internal rules

The internal operation of the Board of Directors, inclu-ding the organisation of the Board member information process and its relations with senior management, is go-verned by internal rules.

This report sets out the main features of these internal rules.

Composition of the Board of Directors

Your Board of Directors currently consists of seven members.

The following are members of the Board of Directors: Benoît Hérault since 30 September 2013 (Chairman), Constance Ben-qué since 30 September 2013, Christine Mondollot since 30 Sep-tember 2013, Rita Maria Zniber since 16 September 2014, Mehdi Bouchaara since 24 October 2014, Jacques Bourbousson since 11 February 2013 and Benoît Ghiot since 16 September 2014.

In accordance with Article L. 225-102-1 of the French Com-mercial Code, the Management Report for the year ended 31 December 2014 provides a list of all offices held by the Board members.

Given the structure of your Company’s share capital, at least 50% of the Board members must be independent directors.

To qualify as independent, a director must:

- Not be an employee or corporate officer of the Company or an employee or director of the parent company or a company consolidated by the Company and must not have held such sta-tus within the last five years;

- Not be a corporate officer of a company where the Com-pany acts as a director either directly or indirectly, or where an employee appointed as such or as a corporate officer of the Company (currently or in the last five years) holds the office of director;

- Not be, either directly or indirectly, a customer, supplier, in-vestment banker or corporate banker:

- that is significant for the Company or its group, - or for which the Company or its group represents a

significant portion of their business.

- Have no close family ties with a corporate officer;

- Not have been an auditor for the Company during the past five years;

- Not have been a director of the Company for over 12 years.

Despite being an executive corporate officer of the Company,

the Chairman of the Board may be considered as independent provided that they do not hold the office of Chief Executive Of-ficer and that the Company can justify their independence with reference to the aforementioned criteria.

There were five independent directors at the end of the 2014 financial year.

Lastly, the Company pays particular attention to gender parity on its Board of Directors. Accordingly, the Board of Directors com-prised 43% women at the end of the 2014 financial year.

No Company director represents the employees.

Assessment of the Board

The internal rules, which were updated by the Board of Directors on 10 October 2014, provide that “once a year the Board will include an item on its agenda regarding a discussion of its operation”. A formal assessment is carried out every three years. This review also implies a review of the special committees set up by the Board”.

Owing to the redefinition of the Group’s organisational struc-ture and the change in the governance system during the year, an assessment of the Board of Directors could not be carried out for the 2014 financial year. Accordingly, at its meeting on 28 April 2015 the Board of Directors agreed to carry out a formal assess-ment during the current year.

Transparency rules

All Board members are required to be shareholders in the Company and to personally hold a relatively significant number of Company shares in view of the directors’ fees that they receive. If they do not hold these shares when they take up their appointment, they must use their direc-tors’ fees to purchase them.

We hereby inform you that on 18 March 2015 the following directors stated that they had purchased shares in the Company on 13 March 2015:

- Benoît Hérault: 871 shares in the Company;- Constance Benqué: 513 shares in the Company;- Benoît Ghiot: 1,000 shares in the Company;- CM Consulting, which is related to Christine Mondollot: 412

shares in the Company.

In addition, the following directors have stated that they cur-rently hold the following number of shares:

- Jacques Bourbousson: 2 shares in the Company;- Mehdi Bouchaara: 25 shares in the Company;- Rita Maria Zniber: 1,300 shares in the Company.

The members of the Board of Directors are periodically infor-med of the provisions introduced by Article L. 621-18-2 of the French Monetary and Financial Code and by the articles that di-rectly concern them under the French Financial Markets Autho-rity’s (AMF) General Regulation.

Accordingly, the directors must report to the AMF any tran-saction involving the purchase, disposal, subscription to or ex-


change of the Company’s equity securities within a maximum period of five trading days following the transaction, as well as any transactions in related financial instruments. Besides the members of the Board of Directors, the Chief Executive Officer and the members of the Executive Committee, this requirement also applies to any private individuals and legal entities related to the aforementioned persons within the meaning of the regu-lations in force. Accordingly, it applies to transactions performed by a spouse, if the persons concerned are not legally separated, a partner bound by a civil partnership, their dependent children, any other relative who has shared the same address for over one year as at the date of the transaction, or any other legal entity whose management duties are performed by one of the afore-mentioned persons, or which is directly or indirectly controlled by such person, or which has been founded for their benefit, or where the majority of the financial benefits accrue to such per-son.

The directors must also familiarise themselves with the closed periods that apply to the Company’s securities and with their obligations to the market, as set out in the regulations in force.

A director is required to inform the Board of Directors of any conflict of interest with the Company and its subsidiaries, even if such conflict is potential. The director shall abstain from voting on the corresponding resolution.

Directors must disclose their personal involvement in a tran-saction in which the Company is directly involved, or of which they have become aware in their capacity as a director, to the Board prior to the completion of that transaction.

Furthermore, directors shall refrain from trading in the Com-pany’s securities during the 30 calendar day period prior to the announcement of the annual and half-yearly results and during the 15 calendar day period prior to the quarterly results; trading may be resumed on the day after the public announcement of the results.

Frequency of meetings

Article 16 of the Company’s Articles of Association pro-vides that the Board of Directors shall meet as often as the Company’s interests require.

The Board of Directors met 18 times during the financial year ended.

The dates of Board meetings, the main items on the agenda and directors’ attendance during the 2014 financial year were as follows:

5 February 2014- Authorisation of the signing of an amendment to the cash

pooling agreement.Attendance rate: 67%

18 February 2014- Overview of the budget for 2014Attendance rate: 83%

27 March 2014- Appointment of Jean-Noël Reynaud as Chief Executive Offi-

cer, for an indefinite period, subject to his agreement;- Retention of Krzysztof Trylinski as a director and Chairman of

the Board of Directors;- Separation of the roles of Chairman and Chief Executive Of-

ficer, subject to Jean-Noël Reynaud’s acceptance of his appoint-ment, from the effective date of his appointment.

Attendance rate: 100%

31 March 2014- Acknowledgement of Jean-Noël Reynaud’s acceptance of

the position of Chief Executive Officer on 5 May 2014.Attendance rate: 83%

17 April 2014- Review of regulated agreements;- Review of Q1 2014 sales results.Attendance rate: 83%

29 April 2014- Approval of the Company and consolidated financial state-

ments for the year ended 31 December 2013;- Approval of the management forecasts;- Approval of the Chairman’s report on internal control proce-

dures;- Approval of the Group’s Management Report.Attendance rate: 83%

15 May 2014- Recording of a capital increase via the exercise of warrants;- Approval of the agenda and draft resolutions to be sub-

mitted to the General Meeting of Shareholders;- Convening of the shareholders to a Combined General Mee-

ting on 25 June 2014.Attendance rate: 83%

23 June 2014- Preparation of the next General Meeting.Attendance rate: 67%

25 June 2014- Answers to written questions received from shareholders;- Composition of the Strategy Committee.Attendance rate: 100%

16 July 2014- Convening of the shareholders to a Combined General Mee-

ting on 16 September 2014, on the second invitation.Attendance rate: 83%

28 July 2014- Appointment of Benoît Hérault as Chairman of the Board of

Directors to replace resigning Chairman Krzysztof Trylinski with effect from the end of the next General Meeting of Shareholders.


28 August 2014- Authorisation of the signing of an amendment to the cash

pooling agreement.Attendance rate: 67%


16 September 2014 (prior to the General Meeting of Shareholders)

- Appointment of Benoît Ghiot as a member of the Audit Com-mittee, subject to his appointment as a director.


16 September 2014 (during the adjournment of the General Meeting of Shareholders)

- Approval of Resolution A (inclusion of a new resolution re-quested by a shareholder) regarding the appointment of Rita Maria Zniber as director;

- Rejection of Resolutions B and C (inclusion of new resolu-tions requested by shareholders) regarding the appointment of Serge Heringer and Guillaume De Belair as directors.


10 October 2014- Merger of the Appointments Committee and Remuneration

Committee into a single committee named the Appointments and Remuneration Committee;

- Updating of the Board of Directors’ internal rules;- Classification of Benoît Ghiot as an independent director.Attendance rate: 100%

14 October 2014- Preparations for the approval of the half-yearly financial sta-

tements and business report.Attendance rate: 67%

24 October 2014- Approval of the half-yearly financial statements and business

report;- Approval of the management forecasts;- Co-option of Mehdi Bouchaara as director;- Appointment of Serge Heringer as a permanent guest of the

Board of Directors;- Allocation of directors’ fees;- Appointment of the members of the Strategy Committee;- Authorisation to enter into an escrow agreement with Jean-

Noël Reynaud (assumption of GSC directors’ unemployment insu-rance cover by the Company).


5 December 2014- Approval of the three-year 2018 BiG strategic plan;- Approval of the regulated agreement with Jacques Bour-

bousson, director.Attendance rate: 100%

Convening of Directors

The timetable for the Board meetings is determined by joint agreement, at the latest during the previous meeting. The Board members are then invited to each meeting via email, around eight days in advance.

The Statutory Auditors are invited to the Board meetings called to approve the half-yearly and annual financial statements.

Information provided to the Directors

To enable all directors to perform their duties, take de-cisions in full knowledge of the facts and make an effective contribution to Board meetings, a comprehensive informa-tion package is sent to them prior to each meeting.

This package includes the documents required for them to understand the items on the agenda.

All director receive all information required to perform their duties and may ask to be sent any documents that they consider useful. The directors are informed continuously between Board meetings as required.

To that effect, every director may ask the Chairman or Chief Executive Officer, subject to sufficient advance notice, for any in-formation required in order for them to make a useful contribu-tion to the items on the Board agenda or for any other informa-tion that enables them to fulfil their assignment.

The directors may meet the Company’s main executives in the absence of the executive corporate officers, but must inform the latter beforehand.

Every director may receive training on the Company’s specific features, business lines and business sectors, as well as on their role as a director, at the Company’s expense, if they consider it necessary.

Meetings

The meetings of the Board of Directors will be held at the Company’s premises in Ivry. The Board may decide to hold one of its meetings at another location specified in the invitation on the recommendation of the Chairman and in accordance with the Company’s Articles of Association.

Pursuant to Article L. 225-37 of the French Commercial Code, Article 16-II of the Articles of Association and Article 4.1 of the Board of Directors’ internal rules, Board of Directors’ meetings may be held using video-conference or telecommunications technology. However, voting by video-conference or via telecom-munications technology is prohibited in the case of resolutions regarding the approval of the Company or consolidated financial statements and the appointment and dismissal of the Chairman of the Board of Directors, Chief Executive Officer and Deputy Chief Executive Officers.

Directors who take part in Board meetings via video-confe-rence or telecommunications technology shall be considered present for the purpose of calculating quorum and majority, pro-vided that such technology enables them to be identified and guarantees their effective participation in accordance with the technical specifications provided for by the regulations.

In 2014, the 5 February, 31 March, 16 July, 28 August and 24 October meetings were held using teleconference technology.


Persons invited to Board meetings

At its 24 October 2014 meeting, at the recommenda-tion of the Appointments and Remuneration Committee, the Company’s Board of Directors unanimously resolved to create a permanent non-voting guest position on the Board for Serge Heringer, in his capacity as the represen-tative and expert of Diana Holding, in order for him to contribute his financial and banking expertise to Board meetings. Mr Heringer is also a permanent guest on the Audit Committee.

The Company’s Chief Financial Officer attended eight Board meetings during the year and was given the opportunity to speak during discussions on the Company and consolidated fi-nancial statements and the Group’s overall accounting and finan-cial position.

Likewise, the Company’s Chief Executive Officer attended fif-teen Board meetings and was given the opportunity to speak du-ring discussions on the Company’s operations and outlook, the strategic guidelines to be followed and, more generally, on the Group’s overall policy.

Lastly, a number of the Company’s advisers and consultants were invited to Board meetings to answer any questions put by Board members.

Authorisation of regulated agreements by the Board of Directors

The Board of Directors authorised new or amended re-gulated agreements during the financial year ended. These agreements were audited by the Company’s Statutory Au-ditors, who mention them in their special report.

Minutes of the Board meetings

The minutes of each Board meeting are drawn up at the end of each meeting. The draft minutes are sent to the di-rectors together with the invitation to the next meeting, during which they are approved.

Committees set up within the Board of Directors

Two committees have been set up within the Board of Directors.

The Board of Directors determines the composition and duties of each Committee. These Committees are designed to facilitate the proper operation of the Board and make an effective contri-bution to the preparation of its decisions.

The Committees are responsible for reviewing issues sub-mitted by the Board of Directors or its Chairman for such purpo-se, preparing the Board’s work regarding these issues and repor-ting their findings to the Board in the form of reports, proposals, information and recommendations.

The Committees’ role is strictly advisory. The Board of Direc-tors decides at its own discretion on any follow-up measures that it intends to take in relation to the findings presented by the Committees. The directors are free to vote as they wish, without being bound by these reviews, investigations, reports and any re-commendations issued by the Committees.

Any remuneration paid to Committee members is determined by the Board.

Audit Committee

Chairman: Benoît GhiotMembers: Mehdi Bouchaara and Jacques BourboussonNumber of independent members: 2

The purpose of this Committee is to help the Board of Direc-tors monitor issues relating to the preparation and auditing of the accounting and financial information. The Committee re-views the financial statements and ensures the appropriateness and consistency of the accounting policies applied to the pre-paration of the Company’s individual and consolidated financial statements. Notwithstanding the Board’s powers, the Audit Com-mittee is specifically responsible for monitoring:

i) the processes for preparing the financial reporting;ii) the effectiveness of the internal control and risk manage-

ment systems;iii) the statutory audit of the Company and consolidated finan-

cial statements by the Statutory Auditors; andiv) the independence of the Statutory Auditors.

The Audit Committee held 11 meetings in 2014, on 31 Ja-nuary, 11 March, 16 April, 14 May, 5 June, 3 July, 30 September, 6 October, 9 October, 22 October and 19 December, which were attended by the Statutory Auditors.

The attendance rate was 100%.

The main issues discussed during these meetings were as fol-lows:

- Review of the half-yearly financial statements and the annual Company and consolidated financial statements, the Manage-ment Report and the notes to the financial statements;

- Assessment of the various internal control and audit tasks.

Appointments and Remuneration Committee

Chairwoman: Christine MondollotMembers: Constance Benqué and Jacques BourboussonNumber of independent members: 3

The role of the Appointments and Remuneration Committee is to:

- select, assess and propose to the Board candidates for the position of director, Chairman of the Board, Vice-Chairman and


Chief Executive Officer to the Board, as well as candidates for membership and chairmanship of the Committees;

- draw up a succession plan for executive corporate officers, in order to be able to recommend succession solutions to the Board, including in the event of unforeseen vacancies;

- put forward recommendations and proposals to the Board regarding the following matters: remuneration, the pension and life insurance scheme, supplementary pensions, benefits in kind, the various financial entitlements of the Company’s executive corporate officers, the allotment of bonus shares, performance shares and stock options;

- determine the procedures for setting the variable portion of the remuneration payable to the executive corporate officers, and monitor their application;

- recommend a general policy for allotting bonus shares, per-formance shares and stock options, and determine the frequency of such allotments depending on the categories of beneficiaries;

- review the system for allocating attendance fees among the Board members; and

- give its opinion to senior management regarding the re-muneration of senior executives.

The Appointments and Remuneration Committee held five meetings during the 2014 financial year.

5.1.3 Internal control and risk management procedures

The French Financial Markets Authority (AMF) publi-shed a document entitled “Risk management and internal control procedures: frame of reference” in July 2010. The Company relies on this document with regard to its inter-nal control system.

Definition of internal control

The internal control system consists of a series of re-sources, behaviours, procedures and actions implemented by the Company’s senior management to enable the Com-pany and its subsidiaries to improve their control over their business activities, to make their operations more ef-ficient and to optimise their use of resources. The internal control system is not limited to a series of procedures or accounting and financial processes.

The primary aim of the system is to ensure:

- The application of the instructions and guidelines deter-mined by senior management;

- The proper operation of the internal processes of the Com-pany and its subsidiaries, including those aimed at protecting its assets;

- Compliance with laws and regulations;- The reliability of the financial and accounting information.

In addition to issues that are directly related to the accounting system, the internal control system includes:

- the overall internal control environment, i.e. all the beha-viours, levels of awareness and actions taken by Management (including the corporate governance process) concerning the in-ternal control system and its importance within the entity;

- The control procedures, which refer to the policies and procedures determined by Management in order to achieve the entity’s specific targets.

The internal control system is placed under the guidance of senior management.

Our internal control system applies across a wide scope, which includes controlled companies and subsidiaries whose business activities are likely to pose risks. The two priority measures aimed at strengthening the internal control system implemented in 2014 were as follows:

- an appropriate organisational structure; and- the introduction of tools for monitoring operating perfor-

mance.

This system is part of an approach aimed at identifying, asses-sing and managing the risks likely to affect the achievement of the Group’s targets, regardless of whether those targets are of a strategic, operating, financial or reputational nature or are related to compliance with laws and regulations.

Like any system, no matter how well designed and well ap-plied our internal control system is, it cannot provide an absolute guarantee regarding the achievement of the Group’s targets and under no circumstances provides an absolute guarantee that the risks to which the Group is exposed will be fully eliminated under any circumstances.

- Redefinition of the organisational structure of the Company and its subsidiaries

The Group’s business activities break down between production and marketing of wines and spirits. The Group has chosen an organisational structure divided between se-ven clusters, in order to encourage the operational efficien-cy, team responsiveness, the sharing of best practices and cross-divisional control over its operations.

- A senior management team that meets the Group’s strategic ambitions

The Group’s senior management team was strengthened following the arrival of Jean-Noël Reynaud as Chief Exe-cutive Officer and by the appointment of a Marketing Di-rector, Purchasing Director and Industrial Director.

The Group has recorded the arrival of a Director of Human Re-sources and General Secretary since the beginning of 2015.


Accordingly, the Company has set up an Executive Committee responsible for implementing the 2018 BIG strategic plan and for monitoring programmes that are considered to be priorities:

- Continuing to optimise working capital; - Implementing a consistent and proactive sales policy based

on Category Management; - Reviewing the marketing positioning of the Group’s brands;- Generating significant synergies aimed at optimising the

Group’s efficiency and operating responsiveness while reducing the cost structure; Implementing industrial best practices and pooling the Group’s purchases will be the first drivers of this area of improvement;

- Pooling know-how and expertise.

- Strengthening the Finance Division

The Company has boosted the resources of the Group Finance Division to enable it to deal with the preparation and assessment of the financial statements, controls on subsidiaries, management control, the processing of com-plex transactions and relations with external advisers. The Group Finance Division has added to its teams by:

- strengthening the consolidation unit;- appointing a Group Management Controller;- appointing a Group Treasurer;- appointing a Deputy Finance Director;- setting up an HR function at the head office.

- Organisation and security of IT systems

Local arrangements are made in order to ensure the continuous processing of accounting data. Accordingly, specific hardware is duplicated to act as an automatic back-up in the event of an unforeseen hardware failure.

Regarding storage and protection of data, access to ac-counting and financial information is secured via authorisation granted to named individuals and using passwords. All data is backed up on a daily basis and a second back-up copy is stored in a secure location.

Internal control environment

The Company introduced guideline values based on ex-cellence, openness, responsibility, innovation and team spi-rit during the financial year. These values were included in our “2018 Back in the Game” strategic plan, and must be used as guidelines by all our employees in their operating activities.

These values are reinforced by our corporate Business and Ethics Codes, which were adopted in January 2014. The members of the Executive Committee and the managing directors of our entities are responsible for implementing these codes in the ope-rating activities.

The internal dissemination and disclosure of relevant informa-tion to all Group employees is based on four main priorities:

- Monthly performance reviews involving the subsidiaries’ ma-nagement teams and the members of the Executive Committee.

These meetings provide an ideal opportunity for discussing risks and opportunities;

- Service meetings, the aim of which is to share operating in-formation, review monthly performances, set priorities and de-termine action plans;

- The Group’s website, which sets out key information; an ove-rhaul of the website is planned for 2015;

- A centralised communications process enables Group Mana-gement to disseminate procedures and instructions to all of the clusters.

Risk management

The Group’s organisational structure enables the ma-nagement of the risks and opportunities relating to its business activities. This responsibility is applied at all hie-rarchical levels within the Company and its subsidiaries. All our employees have an influence on the internal control system, apply the processes in their area of responsibility and contribute to the risk management system.

The main participants involved in the processes of identifying, assessing and managing risks and opportunities are senior mana-gement, the Board of Directors, the Finance Division, the various committees and the Internal Audit department.

These participants rely on their experience to anticipate the risks and opportunities relating to trends in the wines and spirits sector. Risks are managed at the appropriate level of the organi-sation. They are set out in section “1.4 Risk Factors” of the 2014 Financial Report.

The main parties involved in managing the inter-nal control

- Senior management and the Executive Committee

The Executive Committee draws up the main principles of the internal control and risk management system, determines the roles and responsibilities of the main stakeholders, coordinates the implementation of those principles and ensures their effec-tive implementation. The Company’s senior management team provides its expertise and assistance to the various subsidiaries, taking specific local features into account.

- Board of Directors

The Company’s Board of Directors is a collegiate body res-ponsible for assisting senior management, helping to set the Group’s strategic guidelines and overseeing their implementa-tion and the proper operation of the Company and its subsidia-ries.

The Board of Directors has introduced:- internal rules, adopted on 25 April 2008 and amended and

approved on 17 December 2013 and 10 October 2014;- special committees: the Audit Committee and the Appoint-

ments and Remuneration Committee.


The Board of Directors familiarises itself with the main features of the internal control and risk management system selected and implemented by senior management, and sees that the major risks incurred by the Group are identified. In this regard, senior management informs the Board of developments in the Group’s main risks and the related action plans.

With regard to the preparation of accounting and financial information, the Board checks that the guidance and control pro-cess introduced guarantees the reliability of the accounting and financial information.

- Audit Committee

The Audit Committee ensures the existence and application of the internal control procedures within the accounting, financial and other corporate functions.

It keeps itself informed of the major risks identified, their as-sessment and their development over time.

- Internal Audit

The Internal Audit department was founded in December 2013 at the initiative of the Audit Committee and the Board of Directors. Internal Audit reports to the Company’s Chief Executive Officer and is involved with all Group entities. Its role is threefold:

- to coordinate the roll-out and implementation of the internal control system based on the guidelines issued by senior mana-gement,

- to provide methodological support to the subsidiaries in terms of internal control and specific financial and technical risks,

- to conduct its own assignments to supplement the external auditors’ assignments.

The involvement of Internal Audit is planned in agreement with senior management. The assignments are selected in accor-dance with the risks identified by the governance bodies or by the Statutory Auditors.

The priority issues addressed by Internal Audit in 2014 were as follows:

- determining Group policies and monitoring their application at the subsidiaries;

- determining the Group reporting process;- performing specific audits at the request of senior manage-

ment;- identifying best practices to apply within the Group;- identifying business risk;- monitoring action plans aimed at strengthening the internal

control process within the Group.

The findings of the audit assignments are fed back to the ma-nagement team of the entity concerned. A summary of those findings, together with the action plan to which the local entity’s management team has committed, are then presented to senior management. The results of all the work are shared with the Sta-tutory Auditors. Conversely, the comments made by external auditors as part of their checks are taken into consideration by

Internal Audit.

Internal Audit plays an active role in monitoring the internal control system via operating audits and compliance audits. It en-sures compliance with both local laws and regulations and the Group’s principles and standards.

- Finance Division

The main role of the Finance Division is to assist and monitor the operating divisions with regard to their financial operations. The Division determines the rules regarding consolidation and financial control, and defines procedures and best practices in areas such as financial control, accounting and consolidation, financing and cash management, tax, financial reporting and IT systems.

The Finance Division oversees the accounting process and takes part in drawing up the annual accounting positions and statements.

For the preparation of the consolidated financial statements, the Company gathers the accounting information from the va-rious entities in the consolidation scope using a consolidation and reporting software package.

Most Group subsidiaries (in Poland, France, Lithuania and Bul-garia) are included in this consolidation system, enabling decen-tralised entry of the consolidation returns.

Lastly, through their various audits, the Statutory Auditors perform the checks specific to their profession on the financial statements of the Company and the companies included in the consolidation scope.

The internal control projects launched in 2014

- Raising the awareness of the subsidiaries’ manage-ment

Throughout 2014, Group senior management worked on raising awareness of the importance of internal control amongst the subsidiary management teams (meetings with the Managing Directors, internal control questionnaires, inclusion of the internal control process in performance measurement).

- Introduction of structural documentation

Good Conduct and Ethics Charters were drawn up. The purpose of these charters is to remind staff of the Group’s expectations in terms of compliance with laws and regu-lations. The charters were disseminated throughout the Group in early 2014.

Draft internal control guidelines shared by the entire Group were introduced in late 2013. These guidelines are based on the AMF internal control guidelines.


The intra-Group cash flows within the Group’s entities were documented at the Finance Division’s initiative. The twofold goal was the management and optimisation of cash flows.

- Introduction of a chart of accounts shared by all Group entities

The aim of this project, which was launched in the first half of 2014, is to strengthen the consistency of and controls on the accounting and financial information fed back by the various Group entities.

- Introduction of business reports and indicators

The Finance Division introduced the following reports during the 2014 financial year:

- a scoreboard monitoring legal risk at each entity;- a scoreboard monitoring contractual and off-balance sheet

commitments made at each entity; - a survey of delegations of authority.

These reports are reviewed by senior management, Internal Audit and the Statutory Auditors.

Preparation and processing of the accounting and financial information

The process of preparing the accounting and financial information is overseen and consolidated by the Group Fi-nance Division.

The preparation and processing of the accounting and finan-cial information is appropriate for the organisational structure of the Group and its subsidiaries.

Each subsidiary is responsible for forwarding monthly finan-cial and operating performance indicators to the Company. This data is reviewed at meetings between local management and the Group Executive Committee.

- The processes for feeding data into the financial sta-tements

All the processes that take place prior to the produc-tion of the financial statements are the subject of specific procedures and rules for approval, authorisation and reco-gnition. Accordingly, procurement takes places within a to-tally secure framework including a list of pre-selected sup-pliers and terms negotiated in advance. Purchase orders are required for any purchases above a certain threshold, while capital expenditure projects approved by the Exe-cutive Committee must be duly documented, justified and authorised in order to be executed.

- The year-end accounting and consolidated financial statement production processes

The year-end accounting processes are subject to spe-cific instructions that set out the detailed timetables, the

exchange rates to be applied, the consolidation scopes and any particular points to follow. These instructions are sent to all the companies, thereby ensuring compliance with deadlines, use of the same year-end parameters and stan-dardised data feedback.

Procedures for approving the various stages of the consolida-tion process have also been introduced. The main aim of these procedures is to approve the following points:

- The proper application of accounting standards and prin-ciples;

- The accurate restatement of specific social indicators;- The identification, reconciliation and elimination of recipro-

cal transactions;- The correct calculation of deferred tax;- The proper assessment and explanation of the change in the

Company’s and consolidated group’s net asset position.

The Group subsidiaries draw up statements on a monthly basis. The statements enable them to identify any specific and non-recurring transactions. Accordingly, the subsidiaries may ask for support from the Group Finance Division when dealing with exceptional or complex transactions.

The aim of this process is to facilitate the annual (and half-yearly) closing process for the consolidated financial state-ments.

- Management reporting and control

The reporting process is a key factor in the Group’s in-ternal management and control system.

The Group Finance Division has introduced various business reports required by senior management in order to manage its operating activities. The main business reports cover the fol-lowing topics:

- 13-week cash position forecasts; and- a monthly operating performance scoreboard.

The introduction of scoreboards has allowed standard feed-back of information considered as key by the Group’s subsidia-ries.

The review processes within the Group have been strengthe-ned. Operating and financial performances are reviewed at mon-thly meetings between the Company and subsidiary senior ma-nagement teams.

These meetings rely on the various monitoring scoreboards introduced.

- Data consolidation

The Finance Division oversees the accounting process and takes part in drawing up the annual accounting posi-tions and statements. The consolidated financial statements are produced on a half-yearly and annual basis.


Every half year, the Group consolidation department issues instructions setting down a timetable of tasks and recalling the procedures for preparing the consolidation returns. These ins-tructions are sent to each subsidiary’s accounting department or shared accounting service centre.

The Company prepares the consolidated financial statements and gathers the accounting information from the various entities in the consolidation scope using a consolidation and reporting software package.

Most Group subsidiaries (in Poland, France, Lithuania and Bul-garia) are included in this consolidation system, enabling decen-tralised entry of the consolidation returns.

The consolidated data is published, and therefore approved by the Statutory Auditors, every six months. Through their va-rious audits, the Statutory Auditors perform the checks specific to their profession on the financial statements of the Company and the companies included in the consolidation scope.

5.1.4 Limitations on the Chief Executive Offi-cer’spowers

Article 18-I of the Articles of Association specifies that the general management of the Company is the responsibi-lity of either the Chairman or another individual appointed from among or outside the directors by the Board of Direc-tors, who carries the title of Chief Executive Officer.

The Company has decided to separate the roles of Chairman of the Board of Directors and Chief Executive Officer.

The Chief Executive Officer represents the Company in its dea-lings with third parties, and has full powers within the limits of the corporate purpose, subject to the powers expressly assigned by law to the general meeting.

The Chief Executive Officer may be dismissed at any time by the Board of Directors.

As an internal measure not enforceable on third parties, the Chief Executive Officer must ensure that he/she has the Board of Directors’ consent for transactions that fall outside the framework of day-to-day management before committing the Company, and specifically for:

(i) any capital increase or issuance of shares or securities gi-ving access to the Company’s share capital, regardless of their na-ture, acting on a delegation of authority granted by the General Meeting of Shareholders, notwithstanding the Board’s option to sub-delegate that authority to the Chief Executive Officer, or to the Deputy Chief Executive Officers, where applicable, as well as any issuance of securities in any of the subsidiaries for the benefit of a third party;

(ii) any financing for the benefit to the Company or one of its subsidiaries in an amount that exceeds (x) €5,000,000 for medium

and short-term financing and (y) €2,000,000 for overdrafts, loans and short-term financing, or any higher threshold determined by the Board. For the purposes of this paragraph, the term “finan-cing” refers to any of the following operations (except for cash pooling transactions, factoring and the choice of banks, which are the responsibility of senior management):

(a) any borrowings; (b) any bond, debt security, promissory note, securitised

loan or other similar instrument;(c) any finance lease or other agreement considered as a

finance lease in accordance with international generally accepted accounting principles;

(d) the purchase of any asset, insofar as the price is payable following the purchase or taking possession of that asset, if the price payment terms constitute a means of financing the pur-chase of the asset;

(e) any security interest, compensation commitment or si-milar assurance covering the financial loss incurred by any person in relation to any factor mentioned above, except for contracts or agreements entered into in the normal course of business;

(f ) any other transaction that has the commercial effect of a liability (e.g. call or put options or other financial instruments);

(iii) any acquisition, sale, transfer, merger or joint venture by the Company or one of its subsidiaries for an enterprise value of over €1,500,000, or any measure aimed at disposing of an asset owned by the Company or one of its subsidiaries with a unit book value or a unit market value of over €1,500,000, provided that, in each case, with the exception of sales, transfers and similar dispo-sals, the transaction involves existing businesses and regions in which the Company or the subsidiaries already operate;

(iv) setting up operations in any new territory, or launching a new business activity (except for the introduction of a new pro-duct, which is the responsibility of senior management);

(v) any proposal or payment of a dividend, or any other distri-bution of any kind to the Company’s shareholders;

(vi) any capital expenditure with a unit value of over €2,500,000;

(vii) any capital expenditure that results in exceeding the an-nual budget approved and/or amended by the Board;

(viii) the signing, amendment, cancellation or termination of a service provision agreement, a pension commitment, an employ-ment contract with a corporate officer of the Company or one of its subsidiaries, or any agreement to their benefit, regardless of whether that benefit is direct or indirect, for an amount over €200,000, on the understanding that the term ‘key employee’ refers to any person whose gross annual remuneration exceeds €180,000;

(ix) any restructuring process involving the Company or any of its subsidiaries where the cost exceeds €1,500,000;

(x) the appointment of beneficiaries of plans involving stock


options, bonus shares or other profit-sharing instruments, where the arrangements have been approved by the General Meeting of Shareholders, and any amendment to said schemes; the crea-tion and implementation of any new stock option, bonus share or other profit-sharing instrument plans; and

(xi) the granting of any security interest, surety, endorsement or guarantee by the Company or any of its subsidiaries that ex-ceeds the amount determined by the Board on an annual basis or that exceeds an annual amount of €1,000,000 if no annual amount has been determined.

Furthermore, the Chief Executive Officer has set up an Execu-tive Committee, the composition of which has been submitted to the Supervisory Board for approval. The role of this Executive Committee is to provide continuous assistance to the Chief Exe-cutive Officer from an operating standpoint, in terms of both ta-king and implementing decisions.

5.1.5 Special terms and conditions regarding shareholder attendance at General Mee-tings

The terms and conditions relating to the attendance of shareholders at General Meetings are set out in Articles 9, 11, 12 and 25 to 30 of the Company’s Articles of Associa-tion.

5.1.6 Principles and rules for determining the remuneration and benefits awarded to corporate officers

The Board of Directors allocates attendance fees to the directors within the overall limit approved by the General Meeting of Shareholders and on the recommendation of its Appointments and Remuneration Committee. The Board may allocate an additional amount of attendance fees, wit-hout exceeding the aforementioned limit, to directors who are members of the special committees in accordance with the time they spend on these committees.

The 16 September 2014 General Meeting of Shareholders set the amount of attendance fees to be divided between the direc-tors for the current financial year at four hundred and forty-five thousand euros (€445,000).

At its meeting on 24 October 2014, the Board of Directors decided to allocate the attendance fees awarded by the General Meeting as follows:

- €100,000 to the Chairman of the Board of Directors;- €45,000 each to all directors except the Chairman of the

Board of Directors;- €25,000 to each Committee Chairman.

The unallocated attendance fees for the 2014 financial year amounted to €25,000.

The Management Report sets out the remuneration paid to each director, on the understanding that no director has ever held or holds an employment contract with the Com-pany or with any affiliated company.

The Chairman of the Board of Directors

5.2 Statutory Auditors’Re-port on the Chairman’s re-port on Corporate Gover-nance and Internal Control


In our capacity as Statutory Auditors to Belvédère SA, and pursuant to the provisions of Article L. 225-235 of the French Commercial Code, we hereby submit our report on the report prepared by the Chairman of your Company in accordance with the provisions of Article L. 225-37 of said Code for the financial year ended 31 December 2014.

It is the Chairman’s responsibility to prepare a report on the internal control and risk management procedures implemented at the Company, including the other information required under Article L. 225-37 of the French Commercial Code regarding, in particular, the corporate governance system, and to submit this report to the Board of Directors for approval.

It is our responsibility:

- to inform you of our comments on the information contained in the Chairman’s report regarding the internal control and risk management procedures relating to the preparation and proces-sing of accounting and financial information; and

- to confirm that the report contains the additional informa-tion required by Article L. 225-37 of the French Commercial Code, on the understanding that it is not our responsibility to check the fairness of this additional information.

We conducted our work in accordance with professional stan-dards applicable in France.

Information regarding the internal control and risk management procedures relating to the preparation and processing of financial and accounting information

Professional standards require that we perform checks aimed at assessing the fairness of the information regar-


ding the internal control and risk management procedures relating to the preparation and processing of the accoun-ting and financial information contained in the Chairman’s report.

These checks specifically consist in:

- familiarising ourselves with the internal control and risk ma-nagement procedures for the compilation and processing of the accounting and financial information underlying the information presented in the Chairman’s report as well as the existing docu-mentation;

- familiarising ourselves with the work that enabled the exis-ting information and documentation to be prepared;

- determining whether the material weaknesses in the internal control procedures relating to the preparation and processing of financial and accounting information that we may have identified in the course of our work are properly disclosed in the Chairman’s report.

In our reports on the prior financial years, we expressed a qualification regarding shortfalls relating to the organisation and operation of the accounting and financial procedures forming part of the Belvédère Group’s internal control system. This situa-tion was specifically liable to affect the process of fully identifying the commitments entered into by the Group and the accurate reporting of those commitments in the accounting and financial information published. The paragraph on “Risk management and internal control procedure” in the Chairman’s report describes the work undertaken in order to strengthen the organisational structure and the procedures forming part of the internal control system. This information remedies the shortfalls that led us to ex-press a qualification in our reports on the previous financial years.

On the basis of our work, we have no matters to report on the information provided regarding the Company’s internal control and risk management procedures relating to the preparation and processing of the accounting and financial information contained in the report by the Chairman of the Board of Directors prepared pursuant to the provisions of Article L. 225-37 of the French Commercial Code.

Other information

We hereby confirm that the report prepared by the Chairman of the Board of Directors includes the other in-formation required by Article L. 225-37 of the French Com-mercial Code.



RENART, GUION & ASSOCIES Aurélie TRUCY

MAZARS Romain MAUDRY Dominique MULLER

5.3 Description of the regu-lated agreements

List of regulated agreements entered into du-ring the financial year:

We hereby inform you that, at its meeting on 5 De-cember 2014, our Company’s Board of Directors autho-rised an agreement falling under Article L. 225-38 of the French Commercial Code between our Company and Jacques Bourbousson (director). The purpose of the re -lated service was to assess the organisational structure, infrastructure and vineyard yield in Bulgaria. A €5,000 invoice was issued for this service, which was performed between 8 and 12 September 2014.

List of previously authorised agreements where the Board of Directors extended previous au-thorisations

- The purpose of the agreement signed between the Company and Krzysztof Trylinski (former Chairman of the Board of Directors) on 17 July 2013 is the provision of support services.

This agreement sets out the terms and conditions for the sup-port services that Krzysztof Trylinski has undertaken to provide to the Company, as well as the related fees.

These services will be performed in exchange for the monthly payment of an amount of €62,500 excluding tax.

The term of this agreement is for a minimum period of three years from the effective date, i.e. the date when Krzysztof Try-linski’s duties at the Company were terminated.

As Krzysztof Trylinski resigned from his duties with effect from 16 September 2014, this agreement will therefore run for a pe-riod of three years from that date.

- The purpose of the agreement is the settlement signed by the Company and Krzysztof Trylinski (former Chairman of the Board of Directors) on 30 September 2013.

The purpose of this settlement is to terminate or prevent any ongoing or latent litigation or disputes that may arise between the parties, primarily as the result of resignations.

Under the terms of this agreement, Krzysztof Trylinski has undertaken to resign from all of his offices and from any other position held at the Company and/or the subsidiaries, on the un-derstanding that he undertakes to resign from his position as a director and as Chairman of the Board of Directors, and to remain in his role as Chief Executive Officer up until the date when the Appointments Committee has recommended the appointment of his successor to the position of Chief Executive Officer. Mr Try-linski acknowledges that he has no claim to make against any of the Group companies, and that none of the Group companies owes him any compensation or repayment of any kind, and that he does not benefit from any undertakings except for the sup-


port contract signed on 17 July 2013.

In return, Belvédère SA, has committed, on its own behalf and on behalf of its subsidiaries, to withdraw from any proceedings that they may have initiated against Krzysztof Trylinski prior to the date when said settlement was signed, as and when required, and definitively waives its right to initiate any proceedings or ac-tions, of any kind, against Krzysztof Trylinski in respect of their past relations, except for the exclusions referred to in Article 2 of the Settlement.

- Krzysztof Trylinski benefits from a guarantee, which provides that your Company will compensate him for any personal loss in-curred as the result of the potential consequences of the signing a memorandum of agreement by Belvédère SA and Angostura Holdings Limited on 4 February 2013.

This guarantee was granted for a period of 10 years from 11 February 2013.

- Advances and non-interest bearing current accounts granted by Belvédère SA: the advances and non-interest bearing current accounts granted by Belvédère SA displayed the following debit balances as at 31 December 2014:

Abbaye de Talloires: €267,000Belvédère Ceska: €339,000

Director concerned: Krzysztof Trylinski

- Belvédère SA has entered into an operating lease on a buil-ding for use as offices and as its registered office at 10 Avenue Charles Jaffelin in Beaune. The rent for the 2014 financial year amounted to €27,000 excluding tax.

Director concerned: Krzysztof Trylinski

Agreements authorised during the financial year and not yet signed

In accordance with the provisions of Article R. 225-30 of the French Commercial Code, we hereby inform you that, at its meeting on 24 October 2014, our Company’s Board of Directors authorised an agreement falling under Article L. 225-38 of the French Commercial Code between our Company and Jean-Noël Reynaud (Chief Executive Officer).

The purpose of this authorisation is to comply with a contrac-tual guarantee undertaking relating to GSC directors’ unemploy-ment insurance, which it had made to the Chief Executive Officer in his letter of appointment. This authorisation provides for the substitution of the GSC insurance by an escrow agreement for an amount of €294,000 and a period of 24 months. It is specifically provided that this escrow agreement will lapse in the event that GSC confirms in writing that it is assuming liability for the cover.

This agreement was entered into on 1 April 2015.

5.4 Statutory Auditors’special report on regulated agree-ments


In our capacity as the Company’s Statutory Auditors, we he-reby submit our report on regulated agreements and commit-ments.

It is our responsibility to inform you, based on the information that has been provided to us, of the characteristic features and of the main terms and conditions of the agreements and com-mitments that have been disclosed to us, or of which we may have become aware during our assignment. It is not up to us to issue an opinion on their usefulness and legitimacy, or to ascer-tain whether other agreements and undertakings exist. Your role, in accordance with the terms of Article R. 225-31 of the French Commercial Code, is to assess the benefit of entering into these agreements and commitments, with a view to their approval.

We are also required to disclose the information provided for in Article 225-31 of the French Commercial Code regarding the execution of the agreements and commitments already appro-ved by the General Meeting during the year ended.

We performed the checks that we considered necessary in view of the professional standards issued by the Compagnie Nationale des Commissaires aux Comptes regarding this assign-ment. These checks consisted in verifying that the information provided to us is consistent with the source documents from which it was extracted.

A G R E E M E N T S A N D C O M M I T M E N T S S U B J E C T TO THE APPROVAL OF THE GENERAL MEETING

AG R E E M E N T S A N D CO M M I T M E N T S AU T H O R I S E D D U R I N G T H E CO U R S E O F T H E P R E V I O U S F I N A N C I A L Y E A R

Pursuant to Article L. 225-40 of the French Commercial Code, we have been informed of the following agreements and commitments previously authorised by your Board of Directors.

Assignment aimed at assessing the infrastructure and yield of the vineyard in Bulgaria

At its meeting on 5 December 2014, your Board of Directors authorised your Company to take on a specific assignment rela-ting to the assessment of the organisation and infrastructure of the vineyard in Bulgaria, as well as the assessment of its yield, in exchange for a financial consideration of €5,000.

Director concerned: Jacques Bourbousson


Payment of the amounts payable under the GSC gua-rantee into an escrow account

At its meeting on 24 October 2014, your Board of Directors au-thorised a payment of €294,000 into an escrow account relating to the GSC cover arranged for the benefit of your Chief Executive Officer, and as provided for by the Company’s contractual com-mitment to Jean-Noël Reynaud in respect of his office as Chief Executive Officer.

The terms of the escrow agreement are as follows:- Amount: €294,000 - Term: 24 months- Implementation: the escrow amount will not be released in

the event that Mr Reynaud leaves the Company voluntarily or that his office is terminated in circumstances where he is at fault;

- Lapse: the escrow agreement will automatically lapse in the event that GSC confirms in writing that it is assuming the cover;

- Performance conditions: in the event that Article L. 225-42-1 of the French Commercial Code applies, the cumulative perfor-mance conditions will be as follows: (i) a positive consolidated EBITDA amount for Belvédère and its subsidiaries, as well as (ii) a positive consolidated underlying operating profit for Belvédère and its subsidiaries.

Manager concerned: Jean-Noël Reynaud

This escrow agreement was entered into on 1 April 2015.

A G R E E M E N T S A N D C O M M I T M E N T S A L R E A D Y APPROVED BY THE GENERAL MEETING

Pursuant to Article R. 225-30 of the French Commercial Code, we have been informed that the implementation of the following agreements and commitments, which had already been approved by the General Meeting in prior fi-nancial years, was ongoing during the financial year ended.

Support Agreement entered into by Belvédère SA and Kr-

zysztof Trylinski

The terms of the agreement are as follows:

Parties Belvédère (the “Company”), Marie Brizard & Roger International, Sobieski sp. Zoo, Sobieski Trade, Domain Menada, Destylernia Sobieski, Destylernia Polmos W Krakowie, and Fabryka Wodek Polmos Lancut (the “Guarantors”) Krzysztof Trylinski

Purpose Agreement for the provision of support services to the Company (the “Support Services Agreement”)

Entry into effect and conditions for implementation

On the date when Krzysztof Trylinski’s duties within the Group are terminated, regardless of the reason for the termination, on condition that:

- in the event that Krzysztof Trylinski took the initiative to leave, he has complied with a three (3)-month notice period, and has continued to perform his duties in good faith during that notice period;

- his duties are terminated by 19 April 2015 at the latest; - the termination of his duties results from a change in the Company’s

strategy, such as a change in the organisation of the Company’s Senior Management.

Term A minimum term of three years (the “Minimum Term”), renewable for periods of one (1) year

Remuneration for the provision of services

€62,500 per month excluding tax

Termination conditions The Company may terminate the Support Agreement at any time, on condition that the Company and the Guarantors pay the full amount due for the period remaining until the expiry of the Minimum Term in one instalment on the termination date. Meanwhile, Krzysztof Trylinski may terminate the Support Agreement at any time as from the expiry date of a six (6)-month period beginning on the effective date. In this event, the Company and the Guarantors will pay the amounts due for the period remaining until the expiry of the Minimum Term in one instalment on the termination date.

Escrow The amount corresponding to the remuneration payable during the Minimum Term under the Support Agreement will be placed in escrow, and released as the Agreement is executed.


An amount of €2,700,000 was paid into an escrow ac-count during the f inancial year ended 31 December 2014. The amount of the fees recognised as an expense is €2,250,000 excluding tax.

Signing of a settlement agreement by Belvédère SA and Kr-zysztof Trylinski

A settlement agreement has been signed by the Company and Krzysztof Trylinski; the object of this agreement is to prevent any current or latent litigation or disputes that may arise between the parties, in particular as the result of resignations, and specifi-cally to prevent:

- Any claim or demand that may be made against the Com-pany or one of its subsidiaries by Krzysztof Trylinski;

- Any claim, demand or objection relating to Krzysztof Try-linski’s offices within the Group;

- Any claim, demand or objection relating to the disputes; and- Any claim or demand that may be made by the Company

or one of its subsidiaries against Krzysztof Trylinski in connection with the management actions taken by the latter as part of the

fulfilment of his corporate offices within the Group, with the ex-press exclusion of:

(a) Any actions performed by Krzysztof Trylinski in breach of the currently applicable statutory provisions, where applicable;

(b) Any fraudulent acts committed by Krzysztof Trylinski, or any act amounting to a criminal offence; or

(c) Any acts contrary to the Company’s corporate interest committed after the date when this agreement was signed and prior to the resignation date.

Under the terms of this agreement, Krzysztof Trylinski has undertaken to resign from all of his offices and from any other position held at the Company and the subsidiaries, on the un-derstanding that he undertakes to resign from his position as a Director and Chairman of the Board of Directors, and to remain in his role as Chief Executive Officer up until the date when the Appointments Committee has recommended the appointment of his successor to the position of Chief Executive Officer. Mr Try-linski acknowledges that he has no claim to make against any of the Group companies, and that none of the Group companies owes him any compensation or repayment of any kind, and that

Non-compete and non-solicitation

Mr Krzysztof Trylinski will refrain from the following for a period of six (6) months as from the termination of the Support Agreement, and subject to the full payment of the remuneration payable during the Minimum Term:

- setting up or acquiring any entity that conducts Competing Business Activities, and/or holding an interest in any company or entity that conducts a Competing Business Activity (other than an exclusive investment interest that does not exceed 5% of the share capital and voting rights in companies where the shares are admitted for trading on a regulated market) in France, the United States, or Poland;

- providing consulting services to a company that conducts a Competing Business Activity, or receiving any remuneration on any grounds from a company that conducts a Competing Business Activity in France, the United States, or Poland;

- performing any duties as an employee, corporate officer, manager, director or consultant in a company that conducts Competing Business Activities in France, the United States, or Poland;

- hiring, soliciting, or canvassing the Group’s employees or managers either directly or indirectly, specifically for the purpose of encouraging them to leave the Group or distract them from the Group, for any other purpose than the Group’s development;

the term “Competing Business Activity” refers to the spirits industry, including the production, distribution, and marketing of distilled alcoholic beverages, on the understanding that the term “Competing Business Activity” does not apply to the design of packaging and wrapping materials for alcoholic beverages.

Confidentiality Krzysztof Trylinski undertakes to comply with the strictest confidentiality, for a period of six (6) months as from the termination of the Support Agreement, regarding any information to which he may have had access while performing his duties at the Group, and subject to the full payment of the remuneration payable during the Minimum Term, except (i) in the event of prior consent by the Company, (ii) if the disclosure of certain information was required pursuant to legal and regulatory obligations, or (iii) in the event of a dispute between Krzysztof Trylinski and a company in the Belvédère Group.


he does not benefit from any undertakings except for the sup-port agreement signed on 17 July 2013.

In return, Belvédère SA, has committed, in its own name and in the name and on behalf of the subsidiaries, to withdraw from any proceedings that they may have initiated against Krzysztof Trylinski prior to the date when said settlement was signed, as and when required, and definitively waives its right to initiate any proceedings or actions, of any kind, against Krzysztof Trylinski in respect of their past relations, except for the exclusions referred to in Article 2 of the Settlement.

Guarantee granted to Krzysztof Trylinski

Krzysztof Trylinski benefits from a guarantee, which provides that your Company will compensate him for any loss suffered on a personal basis as the result of the potential consequences of the signing a memorandum of agreement by Belvédère SA and Angostura Holdings Limited on 4 February 2013.

This guarantee was granted for a period of 10 years as from 11 February 2013.

Advances and non-interest bearing current accounts granted

by Belvédère SA

The advances and non-interest bearing current accounts granted by Belvédère SA displayed the following debit balances as at 31 December 2014:

Lease agreement entered into with the Finest partnership

Belvédère SA has entered into a lease on a building at 10 Ave-nue Charles Jaffelin in Beaune for use as offices and its registered office.

Rent for the 2014 financial year amounted to €27,000 exclu-ding tax.



RENART, GUION & ASSOCIES Aurélie TRUCY MAZARS Romain MAUDRY Dominique MULLER

Beneficiaries Debit balance as at 31/12/2014 in € 000

Abbaye de Talloires 267 Belvédère Yugoslavia 339


marie brizard

The BrandMarie Brizard®, the oldest French

liqueurs house, has been bold since its beginning in 1755 in Bordeaux. A young female visionary, Marie Brizard created the legendary Ani-sette, a secret recipe that has been carefully guarded for 260 years. Over the course of centuries, the house has diversified and perfected its expertise in designing new liqueurs and unique flavors, such as Parfait Amour and Fine Orange, symbols of subtlety and French elegance. Famous for its mastery of the blender’s art, today Marie Brizard® is a staple in over 100 countries.

The ExpertiseMarie Brizard® liqueurs benefit

from the unique expertise of its mas-ter distiller who captures nature at its best (fruits, plants, and spices) in the form of spirits, infusions, and juices. The distiller blends over 400 ingre-dients precisely to create liqueurs with great delicacy and a wonderfully complex aroma. Today Marie Bri-zard® offers a broad aromatic palette from over 100 flavors of liqueurs and syrups.

In 2014, it launched several in-novations, including Limoncini and Chocolat Royal Blanc, as well as the Briz’Art line.

Additional information

PART 3

registration document 177Part 3. additional information

CHAPTER 6G E N E R A L I N F O R MAT I O N A B O U T T H E CO M PA NY AND ITS SHARE CAPITAL

6.1 General information about Marie Brizard Wine & Spirits SA 6.2 Memorandum and Articles of Association 6.3 Shareholders and Voting rights 6.4 Dividend distribution 6.5 Depositary

CHAPTER 7COMBINED GENERAL MEETING 30 JUNE 2015

7.1 Board of Directors’ reports to the Combined General meeting - 30 June 20157.2 Share buy-back program 7.3 Specific reports of the auditors on certain resolutions on the agenda of the General Meeting 30 June 20157.4 Draft resolutions submitted to the General Meeting - 30 June 20157.5 Resolution voting results for the Combined General Meeting held on 30 June 2015

CHAPTER 8PERSONS RESPONSIBLE FOR THE REGISTR ATION DOCUMENT

8.1 Person responsible for the Registration Document8.2 Declaration by the person responsible for the Registration Document8.3 Documents incorporated by reference8.4 Documents available to the public


6.1 General information about Marie Brizard Wine & Spirits SA

6.1.1 Name of the Company

The Company ’s name is « MARIE BRIZARD WINE & SPIRITS ».

6.1.2 Trade and Companies Register, SIRET and EU VAT number

The Company is registered in the Créteil Trade and Companies Register under number 380 695 213.

The Company’s SIRET number is 38069521300047. The APE code is 4676 Z.

The EU VAT number of the Company is FR85380695213.

6.1.3 Term of the Company

The Company was incorporated on 8 February 1991 for a term of 99 years (i.e. until 8 February 2090), unless pre-maturely dissolved or extended as decided at an Extraordi-nary General Meeting of shareholders.

6.1.4 Registered office, legal structure

The Company’s registered office is at 19, boulevard Paul Vaillant Couturier – 40, quai Jean Compagnon – 94200 Ivry-sur-Seine.

Headquarter phone number : 33 1 46 82 05 05

The Company has been constituted in the form of a French public limited company (“société anonyme”) with a Board of Directors.

6.1.5 Legislation governing the Company’s activities, country of origin, address and telephone number of its registered office

The Company is a French company governed by the provisions of the French Commercial Code. Its registered office is situated at 19, boulevard Paul Vaillant Couturier – 40, quai Jean Compagnon – 94200 Ivry-sur-Seine.

GENERAL INFORMATION ABOUT THE COMPANY AND ITS SHARE CAPITAL

6


6.2 Memorandum and Ar-ticles of Association

6.2.1 Company objects (article 2)

The objects of the Company are:

- The importing and exporting of all food and indus-trial products and all manufactured products and manu-factured items, either on its own behalf or in the capacity of an agent;

- The acquisition by the Company of a direct or indi-rect interest, through contributions in kind, purchase of or subscription to securities, shares, rights in a company, merger, holding company or otherwise, in any company or enterprise having a similar or connected purpose;

- And generally all commercial, industrial, investment, real estate and financial transactions directly or indirectly related to the company objects that could contribute to the development of the company.

6.2.2 Board of Directors organization (ar-ticles 13 to 20)

ARTICLE 13 – BOARD OF DIRECTORS

I - The Company shall be managed by a Board of Direc-tors consisting of at least three and no more than eighteen members.

During the existence of the company, the Directors shall be appointed or have their terms of office renewed by the Ordinary General Meeting of shareholders.

II - Their terms of office shall last for six years. The du-ties of a Director shall end at the close of the Ordinary Ge-neral Meeting called to approve the financial statements for the previous financial year held during the year in which the said Director’s term of office expires.

Directors may always be re-elected.

They may be dismissed at any time by the Ordinary Ge-neral Meeting.

No one may be appointed as a Director if, being over the age of 70, more than one third of the members of the Board of Directors would be over that age as a result of his/her appointment. If, when a Director reaches the age of 70, the aforementioned proportion of one third is ex-ceeded, the oldest Director shall be considered to have re-signed immediately at the close of the next Ordinary Ge-

neral Meeting.

III - Directors may be individuals or legal entities; a le-gal entity, at the time of its appointment as Director, must designate a permanent representative subject to the same conditions and obligations and having the same responsi-bilities as if he/she were a Director in his/her own right, without prejudice to the joint and several liability of the legal entity he/she represents; the term of office of the per-manent representative is assigned to him/her for the term of the legal entity he/she represents; it must be renewed each time the legal entity’s term of office is renewed.

If the legal entity terminates the appointment of its re-presentative, it is required to notify the Company of this termination, without delay by registered letter, and state the identity of its new permanent representative; the same shall apply in case of death, resignation or prolonged inca-pacity of the permanent representative.

IV - If one or more Directors’ seats fall vacant between two General Meetings as a result of death or resignation, the Board of Directors may make one or more provisional appointments.

Director appointments made by the Board of Directors shall be subject to ratification by the next Ordinary Ge-neral Meeting. If there is no ratification, the deliberations and actions performed by the Board prior to the General Meeting shall nevertheless remain valid.

If only one or two Directors remain in office, the Di-rector or Directors, or otherwise the Statutory Auditors, shall immediately convene an Ordinary General Meeting of Shareholders for the purpose of appointing additional member(s) of the Board.

The Director appointed to replace another shall only re-main in office during the time remaining to run on his/her predecessor’s term of office.

V - A Director who is an individual may not belong to a total of more than five boards of directors, save the excep-tions provided for by law. The calculation must be perfor-med taking into account, in addition, the positions of chief executive officer, member of the Board of Directors, sole managing director or member of the supervisory board held by the person in question in French public limited companies.

Save exception provided for by law, the position of per-manent representative of a legal entity director or super-visory board member is included in the calculation of the number of offices held by the said individual.

A Company employee may be appointed as a Director if his/her contract of employment pre-dates his/her appoint-ment and corresponds to genuine employment.


In the case of a merger or de-merger, the contract of employment may have been entered into with one of the merged Companies or with the de-merged Company.

However, the number of Company Directors bound to the Company by a contract of employment shall not ex-ceed one third of the Directors holding office.

ARTICLE 14 – DIRECTORS’ SHARES

The Directors are not required to hold any shares in the Company.

ARTICLE 15 – BOARD OFFICERS

The Board of Directors shall appoint from among its in-dividual members a Chairman whose term of office shall be fixed by the Board, without this term being able to exceed that of his/her term of office as a Director.

The Chairman of the Board of Directors shall organise and direct the work of the Board and report thereon to the General Meeting. He/she shall ensure that the Company’s administrative bodies are functioning properly and, in par-ticular, that the Directors are able to perform their duties.

No one over the age of 70 may be appointed Chairman of the Board of Directors. Furthermore, if the incumbent Chairman of the Board of Directors exceeds this age, he/she shall be considered to have resigned at the close of the next Board of Directors meeting.

If the Chairman is absent or incapacitated, for each ses-sion the Board shall appoint one of the members present to chair the meeting.

The Board may also appoint a secretary, who need not be a member of the Board.

ARTICLE 16 – BOARD MEETINGS

I – The Board of Directors shall meet as often as the Company’s interests so require, when convened by the Chairman.

Directors comprising at least one third of the members of the Board of Directors, however, may ask the Chairman to convene the Board of Directors for a specific agenda, if the Board has not met for two months.

The Chief Executive Officer may also ask the Chairman to convene the Board of Directors under a pre-determined agenda.

The Chairman shall be bound by the requests thus sub-mitted.

In principle, the meeting may be convened by letter sent by ordinary post, telex, fax or e-mail. However, it may be

made verbally and immediately if all the Directors consent thereto or are present.

The meeting shall be held either at the registered office or at any other place indicated in the notice of the meeting.

Each notice of meeting must state the main items on the agenda.

II – The presence of at least half of the Directors is re-quired for the Board to be empowered to make decisions.

The decisions shall be taken by the majority of members present or represented, each Director having one vote and not being entitled to represent more than one of his/her colleagues.

Under the conditions provided for by law and the re-gulations, the internal rules of the Board of Directors may provide that those persons considered to be present for the purpose of calculating the quorum and majority of Directors attending the meeting may do so by means of video-conference or telecommunications technology. Vo-ting by means of video-conference or telecommunications technology is nevertheless prohibited in the case of reso-lutions concerning the approval of the parent company or consolidated financial statements and the appointment and dismissal of the Chairman of the Board of Directors, the Chief Executive Officer and Deputy Chief Executive Officers.

Where the votes are equal, the Chairman shall have the casting vote.

III – An attendance register shall be kept, to be signed by the Directors attending the Board of Directors meeting.

The mere mention in the minutes of each meeting of the names of the Directors present, represented or absent shall constitute valid proof vis-à-vis third parties of the number of Directors holding office and of their respective appoint-ments.

IV – The deliberations of the Board of Directors shall be recorded in minutes drawn up in accordance with the ap-plicable statutory provisions and signed by the Chairman of the session and one Director or, should the Chairman be prevented from doing so, by two Directors.

Copies or extracts from these minutes may be certified by the Chairman of the Board of Directors, a senior exe-cutive, a Director temporarily authorised to perform the functions of the Chairman or a proxy empowered for this purpose.

ARTICLE 17 – POWERS OF THE BOARD OF DI-RECTORS

The Board of Directors shall determine the strategies


that guide the Company’s operations and shall ensure that they are implemented. Subject to the powers specifically attributed to General Meetings of shareholders and within the limits of the company objects, it shall deal with any matter involving the proper functioning of the Company and settle any matters concerning it through its delibera-tions.

In relationships with third parties, the Company is bound even by actions performed by the Board of Direc-tors that do not comply with the company objects, unless it can prove that the third party knew that the action fell outside the scope of these objects or that it could not have been unaware thereof in view of the circumstances. Howe-ver, the mere publication of the Articles of Association is not sufficient to constitute such proof.

The Board of Directors may carry out any checks and verifications it considers appropriate.

All Directors shall receive all of the information neces-sary for the performance of their assignments and may procure communication of any documents they consider appropriate.

The Board of Directors may delegate any powers to any persons of its choice within the limit of those conferred by law and under the present Articles of Association.

It may decide to create committees responsible for re-viewing matters which the Board or its Chairman shall sub-mit to them for examination and for their opinion.

The Board of Directors shall have full power to autho-rise the Chairman-Chief Executive Officer to assign any sureties as security for any bonds issued or to be issued by the Company.

ARTICLE 18 – SENIOR MANAGEMENT – DELE-GATION OF POWERS

I – The senior management of the Company is assumed, under his/her responsibility, by the Chairman of the Board of Directors or by another individual, who may or may not be a Director, appointed by the Board of Directors and bearing the title of Chief Executive Officer.

The Board of Directors shall choose between the two senior management options referred to in the previous pa-ragraph and, where applicable, shall appoint a Chief Exe-cutive Officer.

The shareholders and third parties shall be informed of this choice under the conditions provided for by law and the regulations.

If senior management is assumed by the Chairman of the Board of Directors, all of the following provisions rela-ting to the Chief Executive Officer shall apply to him/her.

The Chief Executive Officer ’s term of office shall be fixed by the Board of Directors, subject to the Board’s right to dismiss him/her from office and the Chief Executive Of-ficer’s right to step down before the end of his/her term of office.

A Chief Executive Officer’s term of office may not ex-ceed that of his/her term of office as a Director.

No one may simultaneously hold more than one post of Chief Executive Officer of a «société anonyme» whose re-gistered office is in French territory, except in specific cases provided for by law.

No one over the age of 70 may be appointed Chief Exe-cutive Officer. Furthermore, if the incumbent Chief Exe-cutive Officer exceeds this age, he/she shall be deemed to have resigned automatically at the close of the next mee-ting of the Board of Directors.

The Chief Executive Officer shall represent the Com-pany in its relationships with third parties and shall be vested with the widest powers, subject to the limits of the company objects and the powers specifically attributed by law to the General Meeting.

In his/her relationships with third parties, the Chief Executive Officer shall be able to commit the Company even through actions that fall outside the scope of the com-pany objects, unless it can be proven that the third party was aware that the action exceeded these objects or that he/she could not have been unaware thereof in view of the circumstances. However, the mere publication of the Articles of Association is not sufficient to constitute such proof.

The Chief Executive Officer shall have the option to par-tially delegate powers to as many persons as he/she sees fit.

In the event of the death or temporary incapacitation of the Chief Executive Officer, the Board of Directors may delegate the duties of Chief Executive Officer to a Direc-tor or to the Chairman. In the case of incapacitation, this delegation of powers shall be of limited duration and shall be renewable. In the case of death, it shall last until the election of a new Chief Executive Officer.

The Chief Executive Officer may be dismissed at any time by the Board of Directors.

II – At the proposal of the Chief Executive Officer, the Board of Directors may appoint Deputy Chief Executive Officers, who must be individuals, chosen from among the Directors or outside of their number, up to a limit of five Deputy Chief Executive Officers.

Deputy Chief Executive Officers may be dismissed at any time by the Board of Directors, at the proposal of the Chief Executive Officer; in case of the latter’s death, resi-


gnation or dismissal, they shall retain their functions and responsibilities until the appointment of a new Chief Exe-cutive Officer, unless the Board decides to the contrary.

The extent and term of the powers granted to the De-puty Chief Executive Officers shall be determined by the Board of Directors with the agreement of the Chief Execu-tive Officer.

Where a Deputy Chief Executive Officer is also a Direc-tor, the term of office as Deputy Chief Executive Officer may not exceed the term of office as Director.

Deputy Chief Executive Officers shall have the same powers, in relation to third parties, as the Chief Executive Officer.

No one over the age of 70 may be appointed Deputy Chief Executive Officer. Furthermore, if an incumbent De-puty Chief Executive Officer exceeds this age, he/she shall be deemed to have resigned automatically at the close of the next meeting of the Board of Directors.

ARTICLE 19 – REMUNERATION OF THE DIREC-TORS, CHAIRMAN, CHIEF EXECUTIVE OFFICER, DEPUTY CHIEF EXECUTIVE OFFICERS AND BOARD DELEGATES

I – The Ordinary General Meeting may allocate to the Directors an attendance fee, the amount of which shall be included in the Company’s overheads and shall remain ap-plicable until a decision to the contrary has been taken by the General Meeting.

The Board of Directors shall allocate this fee between its members as it sees fit.

I I – The remuneration paid to the Chairman of the Board of Directors, the Chief Executive Officer and the Deputy Chief Executive Officers shall be determined by the Board of Directors.

It may be fixed or proportional or both fixed and pro-portional.

III – The Board of Directors may grant exceptional pay-ments for assignments or mandates assigned to Directors. In such a case, this remuneration shall be accounted for as operating expenditure and shall be subject to the approval of the Ordinary General Meeting.

No remuneration, whether permanent or otherwise, other than that which is provided for, may be allocated to the Directors, unless they are bound to the Company by a contract of employment under the conditions permitted by law.

ARTICLE 20 – AGREEMENTS BETWEEN THE COMPANY AND A DIRECTOR, CHIEF EXECU-TIVE OFFICER OR DEPUTY CHIEF EXECUTIVE OFFICER

1 – Any agreement made directly or indirectly between the Company and:

- its Chief Executive Officer, any of its Deputy Chief Executive Officers or any of its Directors,

- any of its shareholders holding more than 10% of the voting rights,

- a company controlling a shareholder company holding more than 10% of the voting rights,

shall constitute a regulated agreement subject to prior authorisation by the Board of Directors if it does not cor-respond to a normal transaction entered into on arm’s len-gth terms. The Chief Executive Officer, Deputy Chief Exe-cutive Officer, Director or shareholder in question shall be required to inform the Board as soon as he/she is aware of an agreement requiring authorisation.

Such a person may not take part in the voting concer-ning the authorisation requested. These agreements shall be subject to the approval of the General Meeting under conditions laid down by the law.

This shall also be the case when one of the aforemen-tioned persons has an indirect interest in the agreement and when an agreement is entered into between the Company and a company of which any such person is the owner, a partner with unlimited liability, Manager, Chief Executive Officer, Deputy Chief Executive Officer, Member of the Board of Directors, Director or Member of the Supervisory Board or exercises a general management role within the company in question.

2 – Any agreement falling within the field of application of regulated agreements as defined above, but concerning a normal transaction entered into on arm’s length terms, must be communicated by the party concerned to the Chairman of the Board of Directors, unless the agreement is not material for any of the parties in terms of its purpose or financial implications. The Chairman of the Board of Directors shall then transmit the list of these agreements and the purpose thereof to the Board of Directors, the Sta-tutory Auditors and any shareholder so requesting.

3 – Members of the Board of Directors other than legal entities are not permitted to take out loans from the Com-pany, in any form whatsoever, or to have the Company grant them a current account or other overdraft or offer a guarantee or endorsement to cover their commitments to third parties.

The same prohibition applies to the Chief Executive


Officer, Deputy Chief Executive Officers and the perma-nent representatives of legal entities that are Directors. It also applies to spouses, ascendants or descendants of those persons covered by the present article as well as any inter-mediary.

6.2.3 General Meetings (articles 22 to 29)

ARTICLE 22 - GENERAL MEETINGS

Collective decisions of shareholders are made during general meetings, which are classified as ordinary, extraor-dinary or special, depending on the nature of the decisions they are required to take.

Special General Meetings are attended by the sharehol-ders of a predetermined share category to rule on any change to the rights attached to shares in that category. These meetings are convened and pass resolutions under the same conditions as for Extraordinary General Mee-tings.

Any duly constituted General Meeting shall represent the entire shareholding body.

The deliberations of the General Meetings shall be bin-ding upon all shareholders, even if absent, dissenting or incapacitated.

ARTICLE 23 - NOTICE AND VENUE OF GENERAL MEETINGS

Shareholders’ General Meetings are convened and pass resolutions under conditions laid down in law. The mee-tings shall be held at the registered office or elsewhere as specified in the notice convening the meeting.

ARTICLE 24 - AGENDA

I - The agenda for General Meetings shall be prepared by the person convening the meeting.

II - One or more shareholders, representing at least the proportion of share capital prescribed by law and acting in accordance with statutory conditions and time limits, may request, by registered letter with acknowledgement of re-ceipt, the inclusion of draft resolutions in the agenda for the General Meeting.

III - The General Meeting may not vote on an issue that has not been placed on the agenda, nor may the agenda be changed if there is a second notice of meeting. It may, however, in all circumstances, dismiss one or more Direc-tors and replace them.

ARTICLE 25 – ADMISSION TO GENERAL MEE-TINGS – PROXY

Every shareholder shall have the right, upon proving his/her identity, to participate in General Meetings re-gardless of the number of shares that he/she holds, by at-tending in person, by returning a postal ballot form or by appointing a proxy, provided that:

- for registered shareholders, their shares are registered in the name of the shareholder or their registered interme-diary, pursuant to Article L 228-1(7) of the French Com-mercial Code, in the Company’s share register;

- for holders of bearer shares, their shares are registe-red in the name of the shareholder or their registered in-termediary, pursuant to Article L 228-1(7) of the French Commercial Code, in the bearer share accounts held by the duly appointed intermediary,

on the second business day prior to the General Mee-ting at midnight, Paris time.

ARTICLE 26 – ATTENDANCE SHEET - OFFICERS - MINUTES

I - At each General Meeting there shall be an attendance sheet containing the information required by law.

This attendance sheet, duly signed by the shareholders present and the proxies, with all proxy forms and postal ballot forms attached thereto, shall be certified as accurate by the officers of the General Meeting.

II - General Meetings are chaired by the Chairman of the Board of Directors or, in his absence, by a Deputy Chairman or a Director specially appointed for this pur-pose by the Board.

If the General Meeting is convened by the Statutory Au-ditor or Auditors, it shall be chaired by one of them.

In all cases, where no one is entitled or appointed to chair the General Meeting, it shall elect its own Chairman.

The duties of teller shall be performed by two sharehol-ders present who agree to do so and who, either on their own account or as proxies, possess the largest number of votes.

The officers thus appointed shall appoint a secretary, who need not be a shareholder.

The officers shall perform the tasks of checking, cer-tifying and signing the attendance sheet, ensuring that the discussions are held properly, dealing with any incidents occurring during the session, checking the ballots, ensu-ring that they are compliant and ensuring that the minutes are drawn up.


III - The minutes shall be drawn up and copies or ex-tracts of the deliberations shall be issued and certified in accordance with the law.

ARTICLE 27 - QUORUM – VOTING – NUMBER OF VOTES

I - In Ordinary and Extraordinary General Meetings, the quorum shall be calculated on the basis of all of the shares comprising the share capital and, in the Special Ge-neral Meetings, all of the shares in the category in ques-tion, less shares to which no voting rights are attached ac-cording to the provisions of the law.

In the case of postal voting, in calculating the quorum consideration may only be given to ballots received by the Company before the meeting of the General Meeting, un-der the conditions and deadlines fixed by decree.

II - The voting rights attached to shares are proportional to the share capital that they represent. Where all shares have the same par value, each equity share or dividend share shall carry entitlement to one vote.

Any owner of shares that are paid up in full, who can prove registration in his/her name for the previous four (4) years at least, shall enjoy double voting rights as pro-vided for by law. Furthermore, should there be an increase in the capital through the capitalisation of reserves, profits or additional paid-in capital, double voting rights shall be conferred, as of issuance, on bonus registered shares allo-cated to a shareholder in respect of their existing double voting shares.

Any share converted into a bearer share or where the ownership is transferred will for feit the double voting right.

Transfer through succession, liquidation of communal property between spouses or inter vivos gift to a spouse or relative entitled to inherit an estate shall not cause the acquired right to be forfeited and shall not interrupt the four-year period provided for under this article.

III – If the shares have been pledged, the voting right shall be exercised by the owner of the securities.

The issuing company may not vote using shares it has subscribed to, acquired or accepted as security and these shares are not taken into account in calculating the quo-rum.

IV - The voting and balloting shall take place by show of hands, by “sitting and standing” or by roll call, in ac-cordance with the decision of the officers of the General Meeting.

ARTICLE 28 - ORDINARY GENERAL MEETINGS

I - The Ordinary General Meeting shall be convened to pass any resolutions that do not involve amendments to the Articles of Association. They are held at least once a year, according to the statutory and regulatory deadlines in force, to approve the financial statements for the previous financial year.

The Ordinary General Meeting may validly pass re -solutions, when convened for the first time, only if the shareholders present, represented or voting by postal vote hold at least one-fifth of the shares to which voting rights are attached. If convened for the second time, no quorum is required. The meeting shall pass resolutions by a majo-rity of the votes of the shareholders present or represented, including shareholders voting by post.

ARTICLE 29 - EXTRAORDINARY GENERAL MEE-TINGS

I – Only the Extraordinary General Meeting shall be entitled to amend the Articles of Association in all the pro-visions thereof. It may not increase the shareholders’ com-mitments, except in the case of transactions resulting from an exchange of shares or reverse share split duly decided upon and executed.

II – Extraordinary General Meetings may only pass re-solutions if the shareholders present, represented or voting by post hold, when the meeting is convened for the first time, one quarter and, when convened for the second time, one fifth of the voting shares. If the latter quorum is not obtained, the second General Meeting may be postponed to a date no later than two months following the date on which it was convened.

It shall rule by a two-thirds majority of the votes of the shareholders present or represented, including sharehol-ders voting by post.

III – By way of statutory exemption to the foregoing, a General Meeting that decides to increase the capital by ca-pitalisation of reserves, profits or additional paid-in capital may so approve as long as it is quorate and has the majo-rity applicable to the Ordinary General Meeting.

Fur thermore, in an Extraordinar y General Meeting convened to vote on the approval of a contribution in kind or the granting of a special benefit, the contributor or the beneficiary whose shares do not carry voting rights shall not be entitled to vote, either on his/her own behalf or as a proxy, and each of the other shareholders shall have a nu-mber of votes equal to the shares he/she owns without this number exceeding ten; a shareholder’s proxy shall have the votes he/she holds under the same conditions and up to the same limit.

In the case of contributions in kind or grants of spe-


cial benefits, one or more Statutory Auditors shall be ap-pointed by the courts at the request of any interested party.

IV - If several categories of shares exist, no change may be made to the rights attached to shares in any of these categories, without a due vote at an Extraordinary General Meeting open to all shareholders and, furthermore, wit-hout a vote that is also compliant in a General Meeting open only to the holders of shares in the category in ques-tion.

6.2.4 Rights, privileges and restrictions at-tached to shares (articles 8 to 12)

ARTICLE 8 – PAYMENT FOR SHARES

New shares for cash to increase the share capital must be paid up in accordance with the procedure established by the Extraordinary General Meeting and in an amount not less than one quarter of their par value at the time of subscription plus, where applicable, the full issue pre-mium.

The balance must be paid up in one or several instal-ments as called by the Board of Directors, within five years from the date on which the capital increase was finalised.

Cal ls for contr ibutions shal l be communicated to subscribers at least fifteen days before the date fixed for each payment, by registered letter with acknowledgement of receipt sent to each shareholder, or through a notice in an official gazette published at the location of the registe-red office.

Any delay in the payment of unpaid amounts due on the shares shall automatically be subject to interest at the sta-tutory rate, without the need to carry out any formal proce-dures, applicable from the due date, without prejudice to any action the Company may take against the defaulting shareholder and implementation measures provided for by law.

ARTICLE 9 – FORM OF SHARES – IDENTIFIABLE BEARER SHARES – SIGNIFICANT EQUITY INTE-RESTS

Fully paid-up ordinary shares may be either registered shares or bearer shares. Restricted voting shares may only be registered shares and shall be recorded in a directly re-gistered or administered registered share account.

They shall be registered in the account under the condi-tions and according to the procedures prescribed by law.

The Company shall be entitled at any time to apply the statutory provisions concerning identification of the hol-ders of securities that confer immediate or future voting rights in shareholders’ General Meetings.

Any individuals or legal entities that come to hold an interest of at least 2.5% in the Company’s share capital or voting rights, or a multiple of that percentage, either direc-tly or indirectly, on a stand-alone basis or in concert, imme-diately or in the future, pursuant to an agreement or to a financial instrument listed in Article L. 211-1 of the French Monetary and Financial Code, and under the conditions referred to in Paragraphs 4 and 4bis of Article L. 233-9 of the French Commercial Code, must inform the Company thereof within five (5) trading days via a registered letter with acknowledgement of receipt sent to the registered of-fice.

The aforementioned disclosure requirements shall also apply each time an individual’s or legal entity’s share of the capital or voting rights falls below the 2.5% threshold or any multiple thereof.

If the required disclosure is not made under the afore-mentioned conditions, the shares or voting rights that ex-ceed the proportion that should have been disclosed shall be deprived of voting rights under the conditions provided for by law.

The above provisions shall apply without prejudice to statutory provisions regarding threshold crossing disclo-sures and penalties.

ARTICLE 10 - ASSIGNMENT AND TRANSFER OF SHARES

Share ownership shall ensue from the registration of the shares in the name of the owners under the conditions sti-pulated by current regulations.

Restricted voting shares shall be registered in a directly registered or administered registered share account.

Shares are freely tradable, unless otherwise provided for by the statutory or regulatory provisions. Assignments or transfers of shares shall be performed in respect of the Company and third parties through a bank wire transfer under the conditions provided for in the current regula-tions.

ARTICLE 11 – RIGHTS AND OBLIGATIONS AT-TACHED TO SHARES – CONVERSION OF RES-TRICTED VOTING SHARES

I - Each share shall entitle the holder to a share of the Company’s profits and assets equivalent to the proportion of share capital that it represents.

Furthermore, each share entitles the holder to vote and be represented at General Meetings pursuant to statutory provisions and the Articles of Association.

II - Shareholders’ liability is limited to the par value of the shares they own. Over and above this amount, any re-


quest for funds is prohibited.

The rights and obligations shall remain attached to the share regardless of the owner thereof.

Ownership of a share automatically entails adherence to the Company’s Articles of Association and resolutions passed by the General Meeting.

III - The heirs, creditors, assigns or other representatives of a shareholder shall not be entitled to request seizure of the Company’s assets or securities or ask for them to be shared out or sold by auction, nor may they interfere in administrative acts related to the Company; in order to exercise their rights, they must refer to the company inven-tories and the resolutions of the General Meeting.

IV - Whenever ownership of a specific number of shares is required in order to exercise a right of any kind, in the event of an exchange, reverse share split or allocation of se-curities, capital increase or reduction, merger or any other transaction, shareholders owning a number of shares less than the required number may only exercise such rights on condition that they personally undertake to obtain the number of shares required.

V - Unless prohibited by statutory provisions, all of the shares shall be liable as a whole for any tax exemptions or charges, as well as for any taxation that may be payable by the Company, before proceeding to any distribution or repayment, during the term of the Company’s existence or upon its liquidation, in such a manner that, in view of their par value and dividend rights, all shares in the same cate-gory shall receive the same net amount.

VI – Hereinafter:«Related Person» shall mean(i) in respect of a Holder who is an individual, his/

her spouse, civil partner, direct ascendants, direct adult descendants and the family holding company in which he/she holds a majority equity interest and is managing di-rector/chief executive and in which the remaining equity is held by the spouse, civil partner, direct ascendants or direct adult descendants;

(ii) in respect of a Holder that is a legal entity:(x) any person or entity that directly or indirectly

controls or is controlled by this Holder or is controlled by any entity controlling said Holder, it being understood that the notion of control assumes the meaning adopted in Article L.233-3 I and II of the French Commercial Code; or

(y) any joint holder of investment securities un-der French law (or equivalent under foreign law, e.g. a partnership), which (a) controls or manages said Holder, or (b) is controlled or managed by said Holder, or (c) is controlled or managed by a third party who also controls or manages said Holder, or (d) is controlled or managed by any joint holder of investment securities mentioned in (a), (b) and (c) above, it being specified that the notion of control assumes the meaning adopted in Article L.233-3 I

and II of the French Commercial Code.«Competent Antitrust Authority» shall mean any natio-

nal or European antitrust authority with jurisdiction over the transaction in question;

«Holder» shall mean, at any given time, the owner of restricted voting shares or a person entitled to subscribe for or to be allocated restricted voting shares;

«Transfer» shall mean (i) any voluntary or compulso-ry transaction for consideration or free of charge (inclu-ding when such transaction takes place by way of public adjudication or court ruling) that involves the immediate or subsequent transfer of the full ownership of restricted voting shares or any rights derived from restricted voting shares, including any voting right or dividend entitlement, regardless of the legal form of such transaction, notably by way of sale, donation, inheritance, sharing, division of ownership rights, payment in kind, exchange, contribu-tion, partial asset contribution, merger, de-merger, distri-bution in kind, sale with right of repurchase, transfer in trust (or other similar transactions), pledge, security loan or consumer loan, or (ii) any transfer of any preferential right to subscribe for or to be allocated restricted voting shares.

VI.1 Restricted voting shares have the same rights as ordinary shares but are deprived of voting rights for resolu-tions submitted to Ordinary General Meetings relating to the appointment, reappointment or dismissal of members of the Company’s Board of Directors, or any resolution ra-tifying the Board of Directors’ co-opting of a director.

VI.2 A Holder ’s restr ic ted vot ing shares shal l be converted into ordinary shares solely under the following circumstances:

(i) on request from the Holder, provided that, fol-lowing conversion of restricted voting shares into ordinary shares, the equity interest of the Holder, his/her Related Persons or any person acting in concert (as defined under Article L.233-10 of the French Commercial Code) with the Holder or Related Persons does not exceed in total 19.9% of the Company’s voting rights on ordinary shares, provi-ded that one or more of the following conditions are met:

(a) at any time, subject to express prior approval from the Company’s Board of Directors passed by a majority of present and represented Board members as specified in the Company’s Articles of Association;

(b) at any time, should said Holder transfer to any person other than said Holder or one of his/her Related Persons or any person acting in concert (as defined under Article L.233-10 of the French Commercial Code) with the Holder or one of his/her Related Persons, provided said Holder has transmitted to the Company’s Board of Di-rectors (a) any document confirming completion of the Transfer and (b) a statement confirming that the recipient of the Transfer is not said Holder or one of his/her Related Persons or any person acting in concert (as defined under Article L.233-10 of the French Commercial Code) with the Holder or one of his/her Related Persons;

(c) during the first fifteen (15) calendar days of each quarter of a calendar year, if, during the previous quarter, said Holder has notified the Company’s Board of Direc-


tors in writing of one or more requests to convert restricted voting shares into ordinary shares, and on express condi-tion that said Holder, by the last day of the previous quar-ter, has given the Company’s Board of Directors written confirmation a) certifying that the total ordinary share vo-ting rights in the Company belonging to the Holder and all his/her Related Persons will not exceed 19.9% of the Company’s total voting rights following completion of all requested conversions in respect of said quarter and (b) providing for a commitment from said Holder that he/she, acting alone or with his/her Related Persons, will not in-crease his/her share of ordinary share voting rights above the threshold of 19.9% of the Company’s voting rights un-til the Board of Directors meeting called to approve the planned conversion within fifteen (15) days after the end of the quarter in question;

(d) within ten (10) calendar days prior to every Com-pany Ordinary or Extraordinary General Meeting, in the event that, by the 10th day preceding the General Meeting date as stated in the notice of the General Meeting publi-shed in the Bulletin d’Annonces Légales Obligatoires, said Holder has submitted a conversion request to the Com-pany’s Board of Directors together with written confirma-tion a) certifying that the total ordinary share voting rights in the Company belonging to the Holder and all his/her Related Persons will not exceed 19.9% of the Company’s total voting rights following completion of the requested conversion and (b) providing for a commitment from said Holder that he/she, acting alone or with his/her Related Persons, will not increase his/her share of the voting rights above the threshold of 19.9% of the Company’s voting rights until the Board of Directors meeting called to ap-prove the planned conversion within ten (10) days prece-ding the date of the General Meeting in question;

(ii) On request from the Holder, in the event that, fol-lowing conversion of restricted voting shares into ordinary shares, the equity interest of the Holder, his/her Related Persons or any person acting in concert (as defined under Article L.233-10 of the French Commercial Code) with the Holder or his/her Related Persons, exceeds 19.9% of the voting rights on ordinary shares, provided that one or more of the following conditions are met:

(a) at any time, subject to express prior approval from the Company’s Board of Directors passed by a majority of present and represented Board members as specified in the Company’s Articles of Association; or

(b) on presentation of a written document from any Competent Antitrust Authority confirming that there are no reasons to carry out a review of competition following the increase in the Holder’s and all his/her Related Per-sons’ equity interest and ordinary share voting rights in the Company above 19.9% of the Company’s voting rights, or giving tacit or express unreserved approval for the Holder and all his/her Related Persons to increase their share of the ordinary share voting rights above 19.9% of the Com-pany’s voting rights; or

(c) on presentation of a written document from any Competent Antitrust Authority giving tacit or express ap-proval or non-rejection for the Holder and all his/her Re-

lated Persons to increase their share of the ordinary share voting rights above 19.9% of the Company’s voting rights, subject to the Holder and his/her Related Persons meeting their commitments, said commitments not affecting the Company or its subsidiaries and not requiring them to take particular steps other than communicating the information requested by the Competent Antitrust Authority. In the lat-ter case, the Holder’s conversion request shall include all documents that the Company’s Board of Directors deems to be appropriate (approval thereof cannot be refused wi-thout good reason), establishing that any and all commit-ments required by the Competent Antitrust Authority have been satisfied.

Under the scenario defined in paragraph (i)(a) above, the Board of Directors shall meet promptly following re-ceipt of the conversion request in order to approve or re-fuse said request. In the event of approval, the Board of Di-rectors shall note the conversion of restricted voting shares into ordinary shares and shall immediately carry out the formalities to amend the Articles of Association and render the new ordinary shares arising on conversion of restricted voting shares fungible with existing ordinary shares in all respects, including admittance for trading on all stock ex-changes where the ordinary shares are listed.

Under the scenario defined in paragraph (i)(b) above, the Board of Directors shall meet promptly, no later than ten (10) calendar days (reduced to five (5) calendar days in the event of a conversion request following the Trans-fer of a preferential subscription or allocation entitlement to restricted voting shares) following receipt of the Hol-der’s conversion request together with the documents men-tioned in paragraph (ii) above, in order to automatically record the conversion of the restricted voting shares (and/or conversion of the rights mentioned in paragraph I.3 be-low) into ordinary shares and to carry out the formalities for amending the Articles of Association and admitting the new ordinary shares resulting from the conversion of the restricted voting shares for trading on all stock exchanges where Company ordinary shares are listed.

Under the scenarios defined in paragraphs (i)(c) and (i)(d) above, and if the prescribed conditions are met, the Board of Directors shall meet within the deadlines stated under said paragraphs (i)(c) and (i)(d) in order to automa-tically record the conversion of restricted voting shares into ordinary shares and shall promptly carry out the formali-ties for amending the Articles of Association and admit-ting the new ordinary shares resulting from conversion of restricted voting shares for trading on all stock exchanges where Company ordinary shares are listed.

Under the scenario defined in paragraph (ii) above, if the prescribed conditions are met, the Board of Directors shall meet within ten (10) calendar days following the conversion request in order to approve or refuse said re-quest. During this ten-day period, the Holder or Related Person in question shall provide the Board of Directors with all information that may reasonably be requested to enable the Board to verify that the prescribed conditions have been met.

Under the scenario defined in paragraph (ii) above and


in the event that, during this ten (10) calendar day period, on request from the Company’s Board of Directors, an in-ternationally reputed legal firm were to issue an opinion stating unambiguously that the Holder should have ob-tained approval from a different Competent Antitrust Au-thority from the one to which the matter was referred, the Board of Directors shall be entitled to refuse conversion of the restricted voting shares into ordinary shares. Under these circumstances, the Board of Directors shall promptly communicate to the Holder the legal opinion underlying its decision, together with written details of the additional steps it requires the Holder to take with other Competent Antitrust Authorities. In the event of disagreement regar-ding the additional steps to be taken, the Holder and a representative duly appointed by the Company’s Board of Directors shall meet within ten (10) calendar days fol-lowing the Holder’s receipt of the conversion refusal notice sent by the Board of Directors, in order to discuss in good faith how to accomplish the planned steps so as to allow the timely conversion of the Holder ’s restricted voting shares into ordinary shares.

On the other hand, the Holder shall be entitled, in any event, at any time and merely by notifying the Company, to convert all or some of his/her ordinary shares into restric-ted voting shares, in particular if the number of non-voting Company shares should be increased in such a proportion as to cause the share of Company ordinary share voting rights belonging to the Holder, one of his/her Related Per-sons or persons acting in concert with said Holder or one of his/her Related Persons to exceed the 19.9% threshold of the Company’s voting rights.

VI.3 The rules referred to in paragraph I.2 above rela-ting to the conversion of restricted voting shares apply to share warrants, allocation rights or preferential subscrip-tion rights to restricted voting shares.

VI.4 The conversion rules referred to herein do not un-der any circumstances apply to restricted voting shares that have undergone a division of ownership rights.

VI.5 I f the restr icted voting shares are conver ted into ordinary shares, the four (4) year period stipulated in Article 27 of the Articles of Association runs from the subscription date of the restricted voting shares. Conver-sion of restricted voting shares into ordinary shares shall not interrupt this period and double voting rights will ap-ply as from expiry of the four (4) year period beginning on the date of recording the restricted voting shares as regis-tered shares, provided that the holder of the newly created ordinary shares maintains said ordinary shares as registe-red shares until expiry of the aforementioned four (4) year period. Should double voting rights already be granted to restricted voting shares under the foregoing terms, the double voting rights will continue to apply to the ordinary shares resulting from the conversion.

In the event that restricted voting shares are granted double voting rights in accordance with Article 27 of the Articles of Association, the double voting rights can only give rise to the voting rights described in paragraph I.1 above.

VI.6 Conversion of one (1) restricted voting share

entitles the holder to one (1) Company ordinary share. Conversion of one (1) ordinary action entitles the holder to one (1) restricted voting share.

VI.7 The reports of the Board of Directors and the Statutory Auditors prepared in accordance with Article R. 228-18 of the French Commercial Code at the time when the Board of Directors records the conversion of restric-ted voting shares into ordinary shares or vice-versa will be made available to shareholders within fifteen days from said Board meeting and brought to their attention at the next General Meeting.

ARTICLE 12 – INDIVISIBILITY OF SHARES – LE-GAL AND BENEFICIAL OWNERSHIP

I - Shares are indivisible vis-à-vis the Company.

Joint owners of shares shall be required to be repre-sented vis-à-vis the Company by a single representative from among them, to be considered as the sole owner or sole proxy. If the joint owners fail to agree on a representa-tive, the sole proxy may be appointed by the courts at the request of the first joint owner to submit such a request.

II - Unless the Company has been notified of an agree-ment to the contrary, the beneficiaries of shares shall va-lidly represent the legal owners in respect of the Company. The voting rights shall accrue to the legal owner at Ex-traordinary General Meetings.

6.2.5 Conditions to organize changes to the share capital (article 7)

ARTICLE 7 – CHANGES TO THE SHARE CAPITAL

I - The share capital may be increased in all ways and by all means authorised by the law.

Solely the Extraordinary General Meeting is authorised to pass a resolution to increase the share capital, based on a report from the Board of Directors containing the disclo-sures required by law.

In accordance with the law, shareholders have a prefe-rential right to subscribe for shares in cash issued as part of a capital increase in proportion to the number of shares they hold. They may individually waive this right. They also have a right to subscribe for excess shares if expressly authorised by a General Meeting resolution.

Unless otherwise agreed, entitlement to new shares fol-lowing capitalisation of reserves, profits or additional paid-in capital belongs to the legal owner, subject to the rights of the beneficiary.

II - Extraordinary General Meetings may also authorise or resolve on a reduction in the share capital for any rea-sons and by any means, subject to any creditors’ rights.


Under no circumstances, however, may a share capital re-duction infringe shareholder equality.

A share capital reduction, irrespective of the reason, whereby the share capital falls below the statutory mini-mum may only be decided if a condition precedent is es-tablished providing for a capital increase aimed at resto-ring the amount of share capital to at least the statutory minimum, unless the Company adopts a different legal form that does not require the share capital to exceed the amount of share capital following the reduction.

Otherwise, any interested party may apply to the courts to have the Company wound up. The court may not order the Company to be wound up if the amount of share capi-tal has been restored to the statutory minimum by the day on which the court rules on the merits.

6.2.6 Other informations

- Actions necessary to modify the rights of shareholders:

It is stated that the rights of shareholders as set out in the Articles of the Company may only be modified by an Extraordinary General Meeting.

- Provisions that may affect control of the Com-pany:

The Articles of Association of the Company do not contain device for delaying, deferring or preventing a change in control.

- Disclosure thresholds:

Notwithstanding any provision to the legal disclosure requirements, any shareholder acting alone or in concert, coming to hold, directly or indirectly, at least 2.5% of the capital or of the voting rights or a multiple thereof must inform the Company within fifteen days by registered let-ter with acknowledgment of receipt addressed to the head office.

If they have not been reported in the above conditions, the shares or voting rights exceeding the fraction that should have been declared are deprived of voting rights in the legal conditions.

Any shareholder is also required, on the same terms to inform the Company within a period of fifteen days, when crossing downward each threshold of 2.5% of the capital or voting rights.

6.3 Shareholders and Voting rights

6.3.1 Current shareholders

See table below.

6.3.2 Recent events regarding sharehol-ding structure and voting rights to the main shareholders

Shareholding threshold disclosure by DF Hol-ding (18 May 2015)

- By mail received on 13 May 2015, completed by a mail received on 15 May 2015, the limited liability company go-verned by Luxembourg Law “DF Holding” 1 (34-38 ave-nue de la Liberté, L-1930 Luxembourg, Grand Duché du Luxembourg) declared that, on 13 May 2015, it went above the threshold of 5% of the capital and of the voting rights of the company Belvédère and that it owned 1,500,000 shares of Belvédère (same amount of voting rights) re-presenting 5.66% of the capital and 5.61% of the voting rights 2.

1: Controlled by Castel family2: Based on a capital composed of 26,486,621 shares and

26,748,958 voting rights according to alinéa 2 of Article 223-11 of the AMF rules.

Shareholding StruCture and voting rightS aS at 30 juin 2015


% of Voting rights

Public (1) 17 786 589 67,2% 18 048 926 67,5%

Diana Holding (2) 4 585 000 17,3% 4 585 000 17,1%

DF Holding (2) 1 500 000 5,7% 1 500 000 5,6%

COFEPP (3) 1 339 000 5,1% 1 339 000 5,0%

SPC Lux (4) 1 272 611 4,8% 1 272 611 4,8%

Auto détention (5) 3 437 0,0% - -

TOTAL 26 486 637 100,0% 26 745 537 100,0%

(1) : At the date of publication, no shareholder, whether an individual or a corporate entity, had informed the Company of an equity interest exceeding 5 %.(2) : Threshold exceeded and Acting in Concert - declared by letter dated 18 May 2015 and published by the AMF on 20 May 2015(3) : Threshold exceeded - declared by letter dated 26 June 2015 and published by the AMF on 26 June 2015(4) : Threshold downward - declared by letter dated 9 June 2015 and published by the AMF on 10 June 2015(5) : These shares are deprived of voting rights


Shareholding threshold disclosure by KKR (20 May 2015)

- By mail received on 20 May 2015, the company“ KKR & Co. L.P. (c/o Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801, New Castle County, USA) declared that, on 14 May 2015, it went, through the companies of its group Echo Investments I Limited and KKR Credit Advisors (Ireland) 1, below the threshold of 5% of the capital and of the voting rights of the company Belvédère and that it owned no more shares of this com-pany.

- This threshold crossing is the result of the sale of shares off the market.

1: Acting for Avoca Credit Opportunities Fund

Shareholding threshold disclosure and declara-tion of intent - Acting in Concert: Diana Holding and DF Holding (20 May 2015)

- By mail received on 18 May 2015, completed by a mail received on 20 May 2015, the company Diana Holding 1 declared that, on 13 Mays 2015, acting in concert with DF Holding 2 , it went above the threshold of 20% of the capi-tal and of the voting rights of the company Belvédère and that it owned 6,085,000 shares of Belvédère (same amount of voting rights) representing 22.97% of the capital and 22.75% of the voting rights 3 , splitted as follow.

On this occasion, DF Holding precised it went above the threshold of 10%, 15% and 20% of the capital and the voting rights of Belvédère.

These threshold crossings are the result of Diana Hol-ding and Df Holding acting in concert.

- Regarding Article 223-14 III and IV of the general regulations of the AMF, “Diana Holding” stated that it owned:

- 100.000 warrants (BSA) to be exercised before 23 April 2018 and giving access to 38.461 Belvédère shares 4 to the price of €23.82 per share.

- 6.000.000 warrants (BSA), to be exercised before 31 December 2016 and giving access to 16 165 Belvédère shares 5 to the price of €20.01 per share.

- In the same mails, the following declaration of intent was realized:

« “Diana Holding” stated :

- That the threshold crossing is the result of Diana Hol-ding and DF Holding acting now in concert;

- That it acts in concert with DF Holding regarding Belvédère to implement a distribution policy of spirits in Asian and African countries;

- That it does not exclude to pursue acquisitions of Bel-védère shares, according to market conditions;

- That it does not exclude to take control of Belvédère according to Article L.233-3 of the “Code du Commerce” because it may effectively – in the long term - be in the situation of determine “actually, through the voting rights which it owned, the decisions in the General Meetings of that company”;

- That it does not forecast, acting alone or in concert, to cross a threshold in capital or in voting rights that would mandate it to take over the company;

- That it will not ask other nomination as member of the Board of Directors, having already confirmed it would propose the appointment of Mr. Serge Heringer as a direc-tor by the next general meeting shareholders of Belvédère, the latter having currently a permanent guest seat on the Board and to the Audit Committee, without the possibility of take part in decisions;


- That is does not belong to agreements or instruments mentioned in 4° et 4° bis of I of Article L. 233-9 of the Commercial Code;

- That it has not concluded any agreement regarding the reverse transactions of Belvédère shares or voting rights.»

- In the same mails, the following declaration of intent was realized:

« “DF Holding” stated :

- That the threshold crossing is the result of Diana Hol-ding and DF Holding acting now in concert;

- That it acts in concert with Diana Holding regarding Belvédère to implement a distribution policy of spirits in Asian and African countries;

ShareS Split bet ween diana holding and df holding / aCting in ConCert


% of Voting rights

Diana Holding 4 585 000 17,31% 4 585 000 17,14%

DF Holding 1 500 000 5,66% 1 500 000 5,61%

TOTAL 6 085 000 22,97% 6 085 000 22,75%


- That it will not pursue acquisitions of Belvédère shares;

- That it will request a seat on Belvédère’s Board of Di-rectors to be represented.»

1: Limited l iabil ity company governed by Moroccan Law, controlled by Zniber Family (“Domaine Zniber, Ait Harzallah, Province d’El Hajeb, Wilaya de Meknes Tafilalet, Maroc”)

2: Limited liability company governed by Luxembourg Law, controlled by Castel Family (34-38 avenue de la Liberté, L-1930 Luxembourg, Grand Duché du Luxembourg)

3: Based on a capital composed of 26,486,621 shares and 26,748,958 voting rights according to alinéa 2 of Article 223-11 of the AMF rules.

4: 0,384615383497979 Belvédère new share for 1 BSA exerciced. 5: 0,027608894 Belvédère new share for 1 BSA exerciced. It is

specified that the action will be rounded to the nearest whole nu-mber and the broken will be compensated.

Shareholding threshold disclosure by SPC Lux (10 June 2015)

- By mail received on 9 June 2015, the l imited l ia-b i l i t y co m p a ny g ove r n e d by Lu xe m b o u rg L aw S P C Lux 1 (2-4 rue Eugène Rupper t , L-2453 Luxembourg, Grand-Duché de Luxembourg) declared that, on 3 June 2015, it went below the threshold of 5% of the capital and of the voting rights of the company Belvédère and that it owned 1,272,611 shares of Belvédère (same amount of vo-ting rights) representing 4.80% of the capital and 4.76% of the voting rights 2.

- This threshold crossing is the result of the sale of shares on the market.

1: Controlled by Sound Point Beacon Fund LP2: Based on a capital composed of 26,486,621 shares and

26,748,958 voting rights according to alinéa 2 of Article 223-11 of the AMF rules.

Shareholding threshold disclosure by COFEPP (26 June 2015)

- By mail received on 26 June 2015, the company Com-pagnie Financière Européenne de Prise de Participation 1

(COFEPP) (85 rue de l’Hérault, 94220 Charenton-le-Pont) declared that, on 23 June 2015, it went above the threshold of 5% of the capital and of the voting rights of the com-pany Belvédère and that it owned 1,339,000 shares of Bel-védère (same amount of voting rights) representing 5.06% of the capital and 5.01% of the voting rights 2.

- These threshold crossings are the result of the acquisi-tions of shares on the market.

1: Controlled by Mr. and Mrs. Jean-Pierre Cayard and their childrens.

2: Based on a capital composed of 26,486,637 shares and 26,748,974 voting rights according to alinéa 2 of Article 223-11 of

the AMF rules.

6.3.3 Control of the Company and measures taken to ensure that it is not exercised abu-sively

According to the European Regulation under the said Directive «Prospectus» (EC Regulation No 809/2004 of the European Commission of 29 April 2004), the Company has ensured that the control of the Company is not exer-cised in a manner abuse by the adoption of corporate go-vernance measures.

This control is provided in Marie Brizard Wine & Spirits by different governing bodies.

To date, no agreement between the Group companies and companies owned by a majority shareholder has been entered.

Regulated agreements are identified in the report of the Statutory Auditors on regulated agreements.

The Group has, to date, no knowledge of potential conflicts of interest between the duties to the issuer of any of the corporate officers and their private interests and / or other duties.

6.3.4 Change of control

As at the date of the Registration Document, there was no agreement liable to result in a change of control.

6.3.5 Shareholders identification

An investigation leaded by Orient Capital on identi-fiable bearer shares («TPI» process) on the 20 May 2015 identified a total of 26,241,899 shares, representing 99.09% of the shares comprising the capital of the Company.

These shares are owned as to 37.0% of the capital by ins-titutional investors, up to 40.0% by individual shareholders and up to 23.0% by strategic shareholders (DF Diana Hol-ding and Holding).

6.4 Dividend distribution

6.4.1 Reminder regarding Articles of Asso-ciation

Regarding distribution of net earnings, paragraph 33 within the Articles of Association says: « The income sta-


tement, which summarises the year’s income and expenses, shows the profit for the year consisting of the difference between the aforementioned items less charges for depre-ciation, amortisation and provisions.

At least 5% of the profit for the year less previous losses where applicable is deducted from the profit in order to form the statutory reserve. This deduction is no longer re-quired when the reserve reaches an amount equal to one tenth of the share capital; it shall be re-introduced when, for any reason whatsoever, the statutory reserve falls below the aforementioned threshold.

Distributable profit consists of the profit for the year less previous losses and amounts transferred to reserves, pursuant to the law and the Articles of Association, plus retained earnings brought forward.

This profit is distributed among the shareholders in pro-portion to the number of shares held by each one.

Notwithstanding, after deduction of the amounts trans-ferred to reserves, the General Meeting may deduct any amounts it deems appropriate in order to allocate them to any optional, ordinary or extraordinary reserve or to re-tained earnings carried forward.

By preference, dividends are deducted from the profit for the year. Furthermore, the General Meeting may re-solve to distribute available amounts taken from reserves, provided that it expressly specifies the reserve accounts from which such amounts are taken.

Except in the case of a capital reduction, no distribu-tion may be made to the shareholders when the amount of shareholders’ equity, either before or after such distribu-tion, falls or would fall below the amount of share capital plus reserves which the Company is prohibited by law or by the Articles of Association from distributing. The reva-luation surplus is not available for distribution. It may be partly or fully incorporated into the share capital. »

Regarding the possible payment of interim dividends, paragraph 34 within the Articles of Association says:

« I – In respect of all or part of a dividend or interim dividend payment, the General Meeting may grant each shareholder the option of choosing between payment of the dividend or interim dividend in cash or payment in the form of shares, in accordance with statutory provisions.

II – The procedure for cash payment of dividends is de-fined by the General Meeting or, otherwise, by the Board of Directors.

Cash payment of dividends must take place within nine months following the balance sheet date, unless this period is extended by court authorisation.

Nevertheless, if a balance sheet drawn up during or at the end of the financial year and certified by one of the Sta-

tutory Auditors shows that, since the end of the previous financial year, after setting aside the necessary amounts for depreciation, amortisation and provisions, after deducting any previous losses and after transferring to reserves any amounts required by law or by the Articles of Associa-tion, the Company has made a profit, interim dividends may be distributed before the financial statements for the year have been approved. The amount of these interim di-vidends shall not exceed the amount of profit determined in this manner.

No reimbursement of the dividend may be requested from the shareholders unless the distribution was made in breach of statutory provisions and the Company can de-monstrate that the beneficiaries knew that the distribution was unlawful at the time it was made or could not have been unaware of this fact given the circumstances. Where applicable, claims for reimbursement of dividends shall be barred under the statute of limitations three years after the dividend payment has been made.

Dividend entitlements not claimed within five years of the date of payment shall lapse. »

6.4.2 Dividends linked to 2014 annual re-sults

For 2014 annual results, no dividend was distributed to shareholders.

6.5 Depositary At the end of 2014, the establishement providing deposi-

tary services to the Company is CACEIS 14 rue Rouget de Lisle – 92130 Issy-les-Moulineaux, France.

M a r i e B r i z a r d W i n e & S p i r i t s S A : I s i n C o d e FR 0000060873 BVD

Listing on Euronext Paris and Warsow Stock Exchange

Market compartment: Euronext Compartiment B

Eligibility for PEA : Yes / Eligibility for SRD : Yes


7.1 Board of Directors’reports to the Combined General Meeting - 30 June 2015

7.1.1 Initial Board of Directors’ report dated 2 June 2015

Appropriation of earnings

You are required to issue an opinion on the appropria-tion of earnings for the financial year, which amount to an accounting loss of € 8,616,544.

The Board of Directors is proposing to assign the entire loss for the financial year to retained earnings, the amount of which would therefore decrease from - € 492,356,683 to - € 500,973,227.

Agreements covered by Article L. 225-38 of the French Commercial Code

We hereby inform you that the Statutory Auditors have been notified of the agreements previously authorised and entered into that remained valid during the financial year and of the agreements authorised during the financial year, for the purpose of preparing their special report. We re-quest that you approve the terms of these agreements. The purpose of the 4th Resolution is to approve the agreements covered by Articles L. 225-38 et seq. of the French Com-

mercial Code that were entered into or renewed by the Company during the financial year ended.

Appointments

Following the appointment of Mehdi Bouchaara on 24 November 2014 by the Board of Directors, under the terms of the 5th Resolution, we recommend that you approve this appointment, for the remaining term of Mr Bouchaara’s predecessor’s office, i.e. until the General Meeting called to approve the financial statements for the 2018 financial year.

We also recommend that you appoint (6th Resolution) Riverside Management sprl to replace Benoît Ghiot, who has informed us of his intention to resign from his duties as a Director of the Company subject to the adoption of the resolution relating to the appointment of Riverside Mana-gement sprl.

Lastly, we recommend that you appoint two new Direc-tors, Serge Heringer and Jean-Noël Reynaud, the Com-pany’s Chief Executive Officer, under the terms of the 7th and 8th Resolutions.

COMBINED GENERAL MEETING 30 JUNE 2015

7


Overall amount of the annual directors’ fees allocation

The Board of Directors recommends that you set the overall amount of the annual directors’ fees allocation at € 465,000 for the 2015 financial year. This amount takes into account the appointment of two new Directors, as recommended to you under the terms of the 7th and 8th Resolutions, on the understanding that the Board of Di-rectors is not planning any remuneration for the Chief Executive Officer in his capacity as a new Director, if the Meeting approves his appointment under the terms of the 8th Resolution.

Opinion on the remuneration components

Under the terms of the 13th Resolution, you are re-quested to issue a favourable opinion on the components of the remuneration payable or paid to Jean-Noël Rey-naud, in his capacity as Chief Executive Officer, in accor-dance with the recommendations of Paragraph 24.3 of the AFEP-MEDEF Corporate Governance Code dated June 2013.

Treasury share transactions

At the Combined General Meeting of 16 September 2014, you granted your Company authorisation to trade in its own shares on the stock market, under the terms of the 11th Resolution.

We recommend that you authorise the Board of Di-rectors to trade in the Company’s shares on the stock ex-change for a period of 18 months, under the terms of the 14th Resolution. The number of shares that the Company may purchase may not result in it holding over 10% of the number of shares that make up its share capital (5% in the case of shares purchased with a view to retaining them or delivering them in exchange or payment as part of merger, demerger or contribution transactions).

We would remind you that, in accordance with the law, where shares are purchased in order to improve liquidity, the number of shares taken into account to calculate the 10% limit corresponds to the number of shares purchased, minus the number of shares resold during the authorisa-tion period.

The purpose of the buyback programme is to enable the following transactions to be performed:

(i) to implement any stock option plan for the Com-pany’s shares under the provisions of Articles L. 225-177 et seq. of the French Commercial Code;

(ii) to allot shares to employees as part of their parti-cipation in the benefits of the Company’s expansion, and to implement any corporate savings scheme under the conditions provided for by law, in particular by Articles L.

3332-1 et seq. of the French Labour Code;

(iii) to allot bonus shares under the provisions of Ar-ticles L. 225-197-1 et seq. of the French Commercial Code;

(iv) to retain shares with a view to subsequently de-livering them as payment or exchange as part of external growth transactions;

(v) to deliver shares upon the exercise of rights at-tached to securities giving access to the Company’s share capital via redemption, conversion, exchange, presentation of a warrant or in any other way;

(vi) to cancel all or some of the shares, as part of a share capital decrease, subject to the adoption of the 19th Resolution submitted to this General Meeting;

(vii) to ensure liquidity or boost the secondary market in Belvédère shares via an investment service provider, un-der the terms of a liquidity agreement that complies with the code of ethics recognised by the French Financial Mar-kets Authority; and

(viii) to implement any market practice that might be-come accepted by the French Financial Markets Authority and, more generally, to perform any transaction that com-plies with the regulations in force.

We recommend that you set the maximum purchase price per share at €35, excluding transaction costs.

The Board of Directors will inform shareholders of the transactions performed via its annual Management Report, in accordance with the provisions of Article L. 255-211 of the French Commercial Code.

Change in the Company’s name

Under the terms of the 15th Resolution, we propose abandoning the current corporate name for your Company and adopting a new name. In keeping with the recent ar-rival of a new senior management team, and the creation of an Executive Committee, the name “Belvédère” no lon-ger appears appropriate for the values embodied by the Group, as set out in the 2018 BiG Plan. The Group intends to benefit from the recognition of a trademark that is seve-ral hundred years old and enjoys world-wide recognition via the new corporate name proposed to you, namely “Ma-rie Brizard Wine & Spirits”.

Transfer of the Company’s registered office

For reasons of efficiency, in the 16th Resolution we re-commend transferring the address of the Company’s re-gistered office from Beaucaire to Ivry. As the Company’s employees, including senior management, are based at the Ivry premises, it appears desirable to locate the registered office at the Company’s premises at this address, primarily


with a view to reliability and time-saving when dealing with third parties.

Cancellation of treasury shares

In the 18th Resolution, we recommend that you grant the Board of Directors authorisation to cancel, in accor-dance with Article L. 225-209 of the French Commercial Code, shares purchased by the Company pursuant to the authorisation that your Meeting may grant in the 14th Re-solution or shares purchased under previous authorisations to purchase and sell treasury shares granted to the Com-pany.

The purpose of this resolution is to enable your Board of Directors to decrease the share capital as a result of this cancellation. This transaction may not involve more than 10% of the share capital in each 24-month period, in accor-dance with the provisions of the law.

This authorisation will be valid for a period of 18 mon-ths.

2 June 2015,

The Board of Directors

7.1.2 Additional Board of Directors’ report dated 8 June 2015

1) SUMMARY OF RESOLUTIONS TO BE SUB-MITTED AT THE NEXT GENERAL MEETING

Following its meeting dated 2 June 2015, the Board de-cided to modify the text of the resolutions, by undertaking a new numbering of resolutions, and also taking into ac-count requests for draft resolutions to enrollment agenda from several shareholders of the Company, pursuant to the provisions of Article R. 225-71 of the French Commercial Code, authorized or, where applicable, not approved by the Board of Directors at its meeting dated 8 June 2015.

Therefore, ultimately, it is proposed at the General Mee-ting to vote on the text of the following resolutions:

I. Ordinary General Meeting Resolutions

First Resolution (Approval of the Company financial statements for the year ended 31 De-cember 2014)

It is proposed in the first resolution framework, having considered the report of the Board of Directors and the general report of the auditors on the accounts for the year ended 31 December 2014, to approve such they will be pre-sented the annual accounts of the exercise, as well as the transactions reflected in these accounts or summarized in those reports.

Second Resolution (Approval of the consoli-dated financial statements for the financial year ended 31 December 2014)

It is proposed in the second resolution framework, ha-ving considered the report of the Board of Directors and the general report of the Auditors on the consolidated fi-nancial statements for the year ended 31 December 2014, to approve, as they will be presented, the consolidated fi-nancial statements for that year, as well as the transactions reflected in these accounts or summarized in those reports.

Third Resolution (Appropriation of earnings for the financial year)

It is proposed as part of the third resolution, to find that the amount of losses for the year 2014 amounted to 8,616,544 euros, to decide on the proposal of the Board of Directors to allocate the loss of the exercise in full to retained earnings, the amount will increase from - € 492,356,683 to - € 500,973,227 and to acknowledge that no dividend was distributed for the previous three years.

Fourth Resolution (Approval of the agreements referred to in Article L. 225-38 of the French Commercial Code)

It is proposed as part of the fourth resolution, having re-viewed the special report of the auditors on the agreements referred to in Article L. 225-38 of the French Commercial Code concluded and / or executed during the year ended 31 December 2014, to approve the terms of this report and the agreements that exist therein.

Fifth Resolution (Approval of the appointment of Mr. Guillaume de Belair as a new Director)

It is proposed as part of the fifth resolution, after exami-ning the provisions of Article 13 of the Company’s Articles of Association, to decide to appoint Mr. Guillaume de Be-lair, born on 6 April 1977 in Bourges, a French national and residing 22 rue Bonaparte - 75006 Paris, as new direc-tor for a period of six (6) years expiring at the end of the meeting of the Ordinary General Meeting of shareholders called to approve in 2021 the accounts for the previous fi-nancial year, to acknowledge that Mr. Guillaume de Belair satisfies all conditions required by law and regulations.

Sixth Resolution (Appointment of DF Holding as a new Director)

It is proposed as part of the sixth resolution, after exa-mining the provisions of Article 13 of the Company’s Ar-ticles of Association, to decide to appoint DF Holding as a new director for a period of six (6) years expiring at the end of the meeting of the Ordinary General Meeting of shareholders called to approve in 2021 the accounts for the previous financial year, to acknowledge that Mrs. Laurence Dequatre, DF Holding’s permanent representative for the same period of six years, satisfies all conditions required by


law and regulations.

Seventh Resolution (Resignation and appoint-ment of Mrs. Christine Mondollot as Director)

It is proposed in the seventh resolution framework, after examining the provisions of Article 13 of the Company’s Articles of Association, to take note of the resignation of Mrs. Christine Mondollot of her mandate as member of the Board of the Company with effect from the close of the General Meeting, to decide to appoint Mrs Christine Mondollot, born 30 August 1954 in Saint-Cloud, a French national, and residing 40, avenue Bosquet - 75007 Paris, as a director with effect at the end of the general meeting and after the effective date of the aforementioned resigna-tion, for a period of six (6) years expiring at the end of the meeting of the Ordinary General Meeting of shareholders called to approve in 2021 the accounts for the previous fi-nancial year, to acknowledge that Mrs. Christine Mondol-lot satisfies all conditions required by law and regulations.

Eighth Resolution (Resignation and appoint-ment of Mrs. Constance Benqué as Director)

It is proposed in the eighth resolution framework, after examining the provisions of Article 13 of the Company’s Articles of Association, to take note of the resignation of Mrs. Constance Benqué of her mandate as member of the board of the Company with effect from the close of the Ge-neral Meeting, to decide to appoint Mrs. Constance Ben-qué, born 4 July 1960 in Boulogne Billancourt, a French national, and residing 180, rue de Grenelle - 75007 Paris, as a director with effect at the end of the general meeting and after the effective date of the aforementioned resigna-tion, for a period of six (6) years expiring at the end of the meeting of the Ordinary General Meeting of shareholders called to approve in 2021 the accounts for the previous fi-nancial year, to acknowledge that Mrs. Constance Benqué satisfies all conditions required by law and regulations.

Ninth Resolution (Resignation and appointment of Mr. Benoit Hérault as Director)

It is proposed in the ninth resolution framework, after examining the provisions of Article 13 of the Company’s Articles of Association, to take note of the resignation of Mr. Benoît Herault of his mandate as president and member of the board of the Company with effect from the close of the General Meeting, to decide to appoint Mr. Be-noît Herault, born 11 May 1967 at Argenteuil, a French national, and residing Chemin de Justice - 30700 Uzes, as a director with effect at the end of the general meeting and after the effective date of the aforementioned resigna-tion, for a period of six (6) years expiring at the end of the meeting of the Ordinary General Meeting of shareholders called to approve in 2021 the accounts for the previous fi-nancial year, to acknowledge that Mr. Benoit Hérault satis-fies all conditions required by law and regulations.

Tenth Resolution (Resignation of Mr. Benoit Ghiot and appointment of Riverside Manage-ment s.p.r.l. as Director)

It is proposed, in the tenth resolution framework, after examining the provisions of Article 13 of the Company’s Articles of Association, to take note of the resignation of Mr. Benoît Ghiot of his mandate as member of the board of the Company with effect from the close of the General Meeting, to decide to appoint Riverside Management sprl, a Belgian law company with capital of 18,600 euros, whose registered office is at 275 Park Avenue Amée - 5100 Dave (Belgium) and registered with the Belgian trade under the number 0603993759, as a new director with effect at the end of the general meeting and after the effective date of the aforementioned resignation, for a period of six (6) years expiring at the end of the meeting of the Ordinary Gene-ral Meeting of shareholders called to approve in 2021 the accounts for the previous financial year, to acknowledge that Mr. Benoît Ghiot, Riverside Management’s permanent representative for the same period of six years, satisfies all conditions required by law and regulations.

Eleventh Resolution (Approval of the appoint-ment of Mr. Mehdi Bouchaara as a Director)

It is proposed as part of the eleventh resolution, after examining the provisions of Article 13 of the Company’s Articles of Association, to ratify the appointment as direc-tor Mr. Mehdi Bouchaara, residing Rue 15, Villa 10, Hay Ennasr, Meknes (MOROCCO), made provisionally by the Board of Directors at its meeting of 24 October 2014, for the remaining term of his predecessor, until the meeting of the Ordinary General Meeting of shareholders called to approve in 2019 the accounts for the previous financial year.

Twelfth Resolution (Determination of the amount of directors’ fees to be allocated to the Board of Directors)

It is proposed in the twelfth resolution framework, to decide to allocate to the Board of Directors pursuant to the provisions of Article L.225-45 of the French Commer-cial Code, a maximum annual amount of attendance fees of four hundred sixty-five thousand euros (€ 465,000) as of the year 2015 (inclusive), being specified that it is left to the Board the task of distributing the attendance fees between directors, that body laying freely sums due to each.

Thirteenth Resolution (Appointment of a new incumbent Statutory Auditor for the Company)

It is proposed in the thirteenth resolution framework, noted that the mandate of the statutory auditor of the Company comes to an end, to decide accordingly, on the proposal of the Board, to appoint KPMG SA, limited com-pany with capital of € 5,497,100, whose registered office is at 3 cours du Triangle - Immeuble Palatine - 92939 Paris


la Défense Cedex, and registered with the Nanterre Trade and Companies Register number 775 726 417, as new incu-mbent statutory auditor for a period of six (6) years, expi-ring after the Ordinary General Meeting called to approve the financial statements for the year ended 31 December 2020, to acknowledge that the new auditor holder has ac-cepted its functions and meets all the conditions required by law and regulations.

Fourteenth Resolution (Appointment of a new alternate Statutory Auditor for the Company)

It is proposed as part of the fourteenth resolution, noted that the mandate of alternate auditor of the Company co-mes to an end, to decide accordingly, on the proposal of the Board, to appoint Salustro Reydel, limited company with capital of € 3,824,000, whose registered office is at 3 cours du Triangle - Immeuble Palatine - 92939 Paris la Dé-fense Cedex, and registered with the Nanterre Trade and Company Register number 652 044 371, as new alternate statutory auditor for a period of six (6) years, expiring after the Ordinary General meeting called to approve the financial statements for the year ended 31 December 2020, to acknowledge that the new auditor has accepted its func-tions and meets all the conditions required by law and re-gulations.

Fifteenth Resolution (Approval of the specific commitment made to the Chief Executive Offi-cer)

It is proposed as part of the fifteenth resolution, ha-ving reviewed the special report of the auditors on the agreements referred to in Article L. 225-38 of the French Commercial Code, to take note of the conclusions of the report statutory aforementioned accounts and to approve, as appropriate, and in accordance with Article L. 225-42-1 of the French Commercial Code, the commitment in this report took the benefit of Mr. Jean-Noël Reynaud, CEO of the Company, on the receivership by the Company of an amount of two hundred and ninety-four thousand euros (€ 294,000) to permit, under the terms of the letter of its mandate, the payment amounts relating to the GSC secu-rity to the benefit of Mr. Jean-Noël Reynaud.

Sixteenth resolution (Opinion on the remunera-tion components payable or paid to Jean-Noël Reynaud in his capacity as the Company’s Chief Executive Officer)

It is proposed as part of the sixteenth resolution, having reviewed the management report on this matter, and the fact that the mandate of Mr. Jean-Noël Reynaud as Mana-ging Director of the Company began dated 5 May 2014, to issue a favorable opinion on the elements of remuneration or awarded for the year ended 31 December 2014, to Mr Jean-Noël Reynaud in his capacity as CEO of the Com-pany.

Seventeenth Resolution (Authorisation granted to the Board of Directors to perform transac-tions in the Company’s shares on the stock exchange)

It is proposed as part of the seventeenth resolution, ha-ving considered the report of the Board, and in accordance with Articles L. 225-209 and following of the French Com-mercial Code and Regulation 2273 / 2003 issued by the Eu-ropean Commission of 22 December 2003, to authorize the Board to operate on the stock exchange or otherwise in the shares of the Company, to decide that this authorization is to enable the Company:

(i) to implement any stock option plan for the Com-pany’s shares under the provisions of Articles L. 225-177 et seq. of the French Commercial Code;

(ii) to allot shares to employees as part of their partici-pation in the benefits of the Company’s expansion, and to implement any corporate savings scheme under the condi-tions provided for in law, in particular Articles L. 3332-1 et seq. of the French Labour Code;

(iii) to allot bonus shares under the provisions of Ar-ticles L. 225-197-1 et seq. of the French Commercial Code;

(iv) to retain shares with a view to subsequently de-livering them as payment or exchange as part of external growth transactions;

(v) to deliver shares upon exercise of rights attached to securities giving access to the Company’s share capital via redemption, conversion, exchange, presentation of a warrant or in any other way;

(vi) to cancel all or some of the shares, as part of a share capital decrease, subject to the adoption of the 21st Resolution submitted to this General Meeting;

(vii) to ensure liquidity or boost the secondary market in Belvédère shares via an investment service provider, un-der the terms of a liquidity agreement that complies with the code of ethics recognised by the French Financial Mar-kets Authority; and

(viii) to implement any market practice that might be-come accepted by the French Financial Markets Authority and, more generally, to perform any transaction that com-plies with the regulations in force,

to resolve that the number of shares purchased cannot result in an increase in the number of treasury shares held by the Company above 10% of the total number of shares that make up the share capital,

to note that the number of shares purchased by the Company with a view to holding and subsequently deli-vering them either as payment or in exchange for other se-


curities as part of a merger, demerger or contribution may not exceed 5% of the Company’s share capital, in accor-dance with statutory provisions,

to resolve that the shares may be purchased via any means and in compliance with the applicable stock ex-change regulations and the accepted market practices pu-blished by the French Financial Markets Authority, and by using any financial derivatives or options traded on regu-lated or over-the-counter markets, provided that the latter means do not contribute to a significant increase in the vo-latility of the shares,

to note that the Company reser ves the option of carrying out block share purchases,

to note that the Company reserves the option of conti-nuing to execute this share buyback programme during periods of public tender or exchange offers involving its equity securities,

to resolve that the purchase unit price may not exceed thirty-five euros (€ 35) and that, as a result, the maximum theoretical amount that the Company would be likely to pay in the event that it purchased shares at the maximum unit price of thirty-five euros (€ 35) would amount to ni-nety-two million, seven hundred and three thousand, one hundred and seventy euros (€ 92,703,170), based on the maximum amount of 2,648,662 shares to be bought,

to resolve that, in the event of a change in the share par value, a capital increase via capitalisation of reserves and the allotment of bonus shares, a stock split or reverse stock split, a redemption or reduction of the share capital, a dis-tribution of reserves or other assets and any other transac-tions involving equity capital, the prices set out above will be adjusted via a multiplication coefficient equal to the ratio between the number of shares comprising the share capital prior to the transaction and the number of shares following the transaction,

to resolve that, in order to ensure the execution of this authorisation, all powers will be granted to the Board of Directors, with the option of further delegation, with a view to implementing this authorisation and, in particular, assessing the appropriateness of launching a buyback pro-gramme and determining the terms and conditions of that programme, preparing and publishing the information cir-cular relating to the implementation of the buyback pro-gramme, placing all orders on the stock exchange, entering into all agreements, including for the purpose of keeping the share purchase and sale ledgers, making any declara-tions to the French Financial Markets Authority and any other body, completing any other formalities and, in gene-ral, doing everything that is required,

to recal l that the Board of Direc tors wi l l provide shareholders with the information relating to the execution of the share purchase transactions authorised under this re-solution in a special report presented to the Annual Gene-

ral Meeting, including the number and price of the shares purchased in this way for each purpose, and the volume of the shares used for these purposes, together with any reallocations for other purposes involving the shares, and

to resolve that this authorisation will be granted for a period of eighteen (18) months from this General Meeting and will invalidate any other delegation having the same purpose.

II. Extraordinary General Meeting Resolutions

Eighteenth Resolution (Change in the Com-pany’s name and corresponding amendment to the Company’s Articles of Association)

It is proposed as part of the eighteenth resolution, to decide to modify the current name of the Company from « Belvedere » and to adopt the name « Marie Brizard Wine & Spirits », to decide as a result of amend Article 3 of the Articles of Association of the Company as follows:

«The name is:Marie Brizard Wine & Spirits

In all acts and documents issued by the company, the corporate name must be immediately preceded or followed by the words « Société Anonyme » or the initials « SA » and the saying of the share capital. »

Nineteenth resolution (Transfer of the registe-red office and corresponding amendment to the Company’s Articles of Association) It is proposed as part of the nineteenth resolution, to

decide to transfer the registered office at the following address: 19, avenue Paul Vaillant Couturier - 40, quai Jean Companion - 94200 Ivry-sur-Seine, to decide accordingly to amend article 4 of the Articles of Association of the Company as follows:

«The registered office is 19, avenue Paul Vaillant Cou-turier - 40, quai Jean Companion - 94200 Ivry-sur-Seine. It can be transferred to any other place in the same depart-ment or a neighboring department by a simple decision of the Board of Directors, subject to ratification of this deci-sion by the next Ordinary General Meeting, and elsewhere in France by virtue of a resolution of the Extraordinary Ge-neral Meeting of shareholders.

When transferring decided by the Board of Directors, it is authorized to amend the Articles of Association accor-dingly. »


Twentieth resolution (Updates and correspon-ding amendments to the Company’s Articles of Association)

It is proposed as part of the twentieth resolution, to de-cide to update the Articles of Association in accordance with (i) the provisions of Article L.233-9 of the French Commercial Code, and (ii) the provisions of Article R. 225-85 of the French Commercial Code, to decide to change accordingly:

(i) the fourth paragraph of Article 9 of the Articles of Association as follows, provided that the remaining provi-sions of the article remains unchanged:

«All natural or legal persons comes to hold, directly or indirectly, alone or jointly, immediately or in the future pursuant to an agreement or financial instrument men-tioned in article L.211-1 of the Monetary and Financial Code and under the conditions described in paragraphs 4 and 4a of Article L.233-9 of the French Commercial Code, a fraction of at least 2.5% of the capital or of the voting rights or a multiple thereof must inform the Company wit-hin five (5) trading days by registered letter with return receipt addressed to the head office.»;

(ii) the last paragraph of Article 25 of the Articles of Association as follows, provided that the remaining provi-sions of the article remains unchanged:

«The second business day preceding the General Mee-ting at midnight, Paris time.»

Twenty first resolution (Authorisation to be granted to the Board of Directors to decrease the share capital by cancelling treasury shares)

It is proposed as part of the twenty-first resolution, af-ter having considered the report of the Board of Directors and of the Auditors Report and under the condition of the adoption of the seventeenth resolution submitted to the General Meeting authorizin the Board to acquire shares of the Company under legal conditions, to authorize it, which may be delegated:

(i) to cancel at any time without further ado, on one or more occasions, the shares acquired as a result of purchases made in the framework of Article L. 225-209 of the French Commercial Code, within the limit of 10% of capital per twenty-four (24) months, it being recalled that this limit applies to an amount of capital of the Company which will, if necessary, adjusted to take into account transactions af-fecting the share capital subsequent at the general meeting;

(ii) to reduce the capital proportionately, by charging the difference between the repurchase value of the cance-led shares and their par value to available premiums and reserves;

(iii) to amend the Articles of Association accordingly

and accomplish all necessary formalities, to decide that this authorization is granted for a period of twenty-six (26) months from the date of the General Meeting, and to inva-lidate, with effect from this Meeting, the unused portions of any prior delegations having the same purpose.

Twenty second resolution (Powers to effect formalities)

It is proposed as part of the twenty-second resolution, to confer on the bearer of the original, an extract or a copy of these minutes to carry out all formalities advertising, de-posit, and others that belong.

-----------------------------

The board says that it was agreed at its meeting held on 2 June 2015, (i) to add a resolution on the appointment of the company DF Holding as a new director, rather the resolution initially dedicated to the appointment of Mr. Serge Heringer, to take into account the entry of DF Hol-ding within the shareholding structure of capital of the Company, (ii) to remove the eighth resolution on the ap-pointment of Mr. Jean-Noël Reynaud as a new director, the latter having withdrawn his candidature in view of the situation.

2) SUMMARY OF RESOLUTIONS PROPOSED BY SHAREHOLDERS

Prior to the holding of the meeting, the Board received, pursuant to Article R. 225-71 of the French Commercial Code, requests for resolutions from several shareholders of the Company.

At its meeting dated 8 June 2015, the Board of Directors has studied the wordings and motives of various resolu-tions proposed by shareholders, and hereby presents its report on the resolutions considered.

I] RESOLUTION PROPOSED BY DF HOLDING SA

By letter dated 3 June 2015, the company DF Holding SA holding approximately 5.323% of the share capital of the Company, asked the Board to include in the agenda of the General Meeting a resolution for the following reasons:

« As it has been notified to the Belvédère by letter dated 13 May 2015, the company DF Holding holds at the date hereof more than 5% of the share capital and voting rights of Belvedere, saying also on 18 May 2015 it acts in concert with Diana Holding Company.

As of significant new shareholder of Belvedere, DF Hol-ding company needs to be represented on the Board. It would be represented by Mrs. Laurence Dequatre. The in-formation for the director whose appointment is subject to the ordinary general meeting of shareholders are contained in Annex 3 in accordance with Articles R. 225-71 and R. 225-83 of 5 ° of the French Commercial Code.


The proposed director confirms that he accepts the man-date that may be entrusted to him and Laurence Dequatre, which would be DF Holding’s permanent representative within the Board, says she meets all requirements of the law and the regulations for the exercise of that mandate. »

Consequently, DF Holding has requested the inclusion of the following resolution:

«Resolution A (Appointment of DF Holding as a new director)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, having reviewed the provisions of Article 13 of the Com-pany’s Articles of Association,

resolves to appoint DF Holding as a new Director for a period of six (6) years expiring at the end of the Ordinary General Meeting of Shareholders called in 2021 to approve the financial statements for the financial year ending on 31 December 2020, and

notes that Laurence Dequatre, DF Holding’s permanent representative for the same period of six years, has stated that she meets all the conditions required in law and by the regulations.

II] RESOLUTIONS PROPOSED BY DIANA HOL-DING

By letter dated 3 June 2015, Diana Holding company holding approximately 17.36% of the share capital of the Company, asked the Board to include in the agenda of the General Meeting additional resolutions, for the following reasons:

« The entry of Diana Holding in the capital of the Bel-védère, which has become the reference shareholder before its implementation together with DF Holding, the holding company of Groupe Castel, to implement a common poli-cy to develop the international distribution of spirits, par-ticularly in Africa and in Asia, marks a turning point in the life of the Belvedere Group. Diana Holding wants the Board of Directors of Belvedere to be not only consistent with the composition of its shareholders (including two major players in the wine and spirits sector, with a large free float), but also to consist of renowned personalities in the wine and spirits sector, that all contribute to the deve-lopment of the company.

The aim is thus to establish a dedicated board around a majority of professionals in the wine and spirits sector, featuring a real strategic vision on Belvedere Group bu-sinesses, able to give operational and logistical support to management and teams.

Furthermore, it should already have to get out as soon as possible of the continuation plan, taking advantage of the new dynamic brought by the new Board of Directors.

Diana Holding favored the appointment of a consen-sual solution, under which the four independent directors appointed in September 2013 and 2014 have voluntarily resigned, to immediately give way to the representative of the Castel Group (Mrs. Laurence Dequatre) and that three new independent directors:

• Nicolas Gailly, senior manager of the wine and spirits industry (Diageo, Pernod Ricard, etc.);

• Pierre Beuchet, head of trading houses, export specia-list Asia and USA;

• Guillaume de Belair, financial analyst (representing individual shareholders).

However, at the meeting of the Board held 2 June 2015, this solution was rejected by a majority of the directors concerned, who resigned with effect at 30 June 2015 and have already applied for a new term.

In addition, these same directors have clearly adopted a hostile position towards Diana Holding, not only the ap-pointments of Nicolas Gailly and Pierre Beuchet, but also the appointment of Serge Heringer (proposed by Diana Holding), were removed from the agenda of the next ge-neral meeting.

This is why Diana Holding proposes the following re-solutions:

Ordinary general meeting resolutions:

Diana Holding proposes the revocation of the following directors:

• Mr. Benoît Hérault, Chairman of the Board;• Mr. Benoît Ghiot;• Mrs. Christine Mondollot;• Mrs. Constance Benqué.

Diana Holding proposes the appointment as directors of the following candidates:

• Mr. Serge Heringer, current permanent invitee to the Board and to the Audit Committee of Belvedere (proposed Diana Holding);

• Mr. Guillaume De Belair;• Mr. Nicolas Gailly;• Mr. Pierre Beuchet.

Information regarding directors whose appointment is subject to the ordinary general meeting of sharehol-ders are contained in Annex 3 in accordance with Articles R. 225-71 and R. 225-83 of 5 ° of the French Commercial Code.

Each director approached confirmed that he accepts the mandate that would be given to him and declares meet all the conditions required by law and regulations for the exercise of that mandate.


Extraordinary general meeting resolution:

To simplify the structure of existing shares of the Com-pany, particularly the different warrants whose current characteristics are very varied and difficult to read while promoting a capital increase by March 2016 which would allow an early exit from the continuation plan, Diana Hol-ding proposes that the Company makes a public exchange offer (OPE) to all of its existing warrants under which:

• each warrant holder bringing its warrants to the public exchange offer would receive new warrants (« Warrants 2015 ») whose maturity would be set at 31 December 2016;

• each Warrant 2015 would give access to one new share;• upon exercise of the Warrant 2015 before 29 February

2016, a holder would receive for free, in addition to the new action, one warrant (« Warrant 2023 ») whose matu-rity would be set at 31 December 2023.

Parities exchange of Warrants 2015 against each existing Belvedere warrant would be determined by the Board in connection with the preparation of the OPE and would be reviewed by an independent expert appointed by the Com-pany that would call a report evaluation. The transaction would also be subject to an information note which would be subject to approval by the AMF authority.

Finally, Diana Holding proposes a resolution to amend Article 27 of the Articles of Association related to the double voting rights, making Belvedere falling within legal system set up by the Florange Act.

Consequently, Diana Holding has applied the following resolutions:

« Depending on ordinary general meeting

Resolution B Revocation of Mr. Benoît Hérault as Di-rector)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, decide to revoke Benoit Hérault of his functions of Direc-tor. Consequently, his mandate expires at the close of this General Meeting.

Resolution C (Revocation of Mrs. Constance Benqué as Director)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, decide to revoke Constance Benqué of her functions of Di-rector. Consequently, her mandate expires at the close of this General Meeting.

Resolution D (Revocation of Mr. Benoît Ghiot as Di-rector)

The General Meeting, voting under the quorum and ma-

jority conditions required for Ordinary General Meetings, decide to revoke Benoit Ghiot of his functions of Director. Consequently, his mandate expires at the close of this Ge-neral Meeting.

Resolution E (Revocation of Mrs. Christine Mondollot as Director)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, decide to revoke Christine Mondollot of her functions of Director. Consequently, her mandate expires at the close of this General Meeting.

Resolution F (Appointment of Mr. Guillaume de Belair as a new Director)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, having reviewed the provisions of Article 13 of the Com-pany’s Articles of Association, resolves to appoint Guil-laume de Belair as a new Director for a period of six (6) years expiring at the end of the Ordinary General Meeting of Shareholders called in 2021 to approve the financial sta-tements for the financial year ending on 31 December 2020.

The General Meeting notes that Guillaume de Belair has stated that he meets all the conditions required in law and by the regulations.

Resolution G (Appointment of Mr. Nicolas Gailly as a new Director)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, having reviewed the provisions of Article 13 of the Com-pany’s Articles of Association, resolves to appoint Nicolas Gailly a new Director for a period of six (6) years expiring at the end of the Ordinary General Meeting of Sharehol-ders called in 2021 to approve the financial statements for the financial year ending on 31 December 2020.

The General Meeting notes that Nicolas Gail ly has stated that he meets all the conditions required in law and by the regulations.

Resolution H (Appointment of Mr. Pierre Beuchet as a new Director)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, having reviewed the provisions of Article 13 of the Com-pany’s Articles of Association, resolves to appoint Pierre Beuchet as a new Director for a period of six (6) years expiring at the end of the Ordinary General Meeting of Shareholders called in 2021 to approve the financial state-ments for the financial year ending on 31 December 2020.

The General Meeting notes that Pierre Beuchet has


stated that he meets all the conditions required in law and by the regulations.

Resolution I (Appointment of Mr. Serge Heringer as a new Director)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, having reviewed the provisions of Article 13 of the Com-pany’s Articles of Association, resolves to appoint Serge Heringer as a new Director for a period of six (6) years expiring at the end of the Ordinary General Meeting of Shareholders called in 2021 to approve the financial state-ments for the financial year ending on 31 December 2020.

The General Meeting notes that Serge Heringer has stated that he meets all the conditions required in law and by the regulations.

Depending on extraordinary general meeting

Resolution J (Delegation granted to the Board of Direc-tors to issue new share warrants of the Company, without preferential subscription rights, in favor of holders of old share warrants that would be transfered to the Company through a public exchange offer)

The General Meeting, voting under the quorum and majority conditions required for Extraordinary General Meetings, having considered the report of the Board of Di-rectors and the special report of the auditors in accordance with Articles L. 225-129, L.225-129-1, L.225-135, L.225-138 and L.228-91 and following of the French Commercial Code:

1. delegates to the Board of Directors the powers to de-cide to issue, without preferential subscription rights for shareholders, warrants of the Company’s shares (« War-rants 2015 »);

2. decides that the warrants will be issued in 2015 in return for the surrender in exchange for securities trans-ferred to the Company under a public exchange offer ini-tiated by the Company under the conditions set out below, and they will have the following characteristics:

- Exercise price: 20 euros;- Exercise period: from the issuance of the warrants un-

til 31 December 2016;- Parity: each warrant would give access to one new

share;

3. decides, in order to encourage the exercise of war-rants before February 29, 2016, the holders who would exercise their Warrants 2015 before that date would also receive another free warrant, for each warrant exercised in 2015, a new warrant which would have the following cha-racteristics (« Warrants 2023 »):


til 31 December 2023;

- Parity: each warrant would give access to one new share;

4. decides to eliminate the shareholders’ preferential subscription rights for Warrants 2015 issuance to exis-ting warrant holders of the Company, namely the holders o f Wa r ra nt s 2 0 0 4 ( B V D B S ) , B S A 2 0 0 6 ( B V D B R ) , B S A Shareholder 1 (BVDBV ), BSA Shareholder 2 (BVDBW ) and BSA OS (BVDBX), who would have tranfered their warrants through a public exchange offer initiated by the Company for all of the existing warrants;

5. notes that, in accordance with the provisions of Article L.225-132 of the French Commercial Code, this delegation automatically entails, in favor of holders of Warrants 2015 and Warrants 2023, express waiver by shareholders of their preferential right of the shares to which these warrants would give right;

6. resolves that the nominal amount of capital increases likely to be made under this delegation is set at:

- A maximum of eleven (11) million upon exercise of the Warrants 2015,

- A maximum of eleven (11) million on exercise of the Warrants 2023,

being specified that to these amounts would be added, where applicable, the nominal amount of additional shares to be issued, in accordance with the law and applicable contractual provisions, to preserve the rights of holders of securities convertible into shares of the Company;

7. decides that the exchange ratios of the Warrants 2015 against each strain existing warrants of the Company will be determined by the Board in connection with the prepa-ration of the public exchange offer and will be reviewed by an independent expert mandated by the Company which will provide an evaluation report, it being specified that the transaction referred to this resolution will be subject to an information note that will be subject to approval by the AMF authority ;

8. resolves that the Board of Directors would have full powers to implement, as provided by law and within the limits set by this resolution, this delegation of powers, in particular to:

- Determining the final characteristics of Warrants 2015 and Warrants 2023,

- Set the terms and conditions of the issues,- Modify, where appropriate, in agreement with the hol-

ders of Warrants 2015 and / or Warrants 2023, all the cha-racteristics after their issue,

- At its sole initiative, charge the costs of the capital in-creases to the amount of the premiums and deduct from this amount the sums necessary to bring the reserve to one tenth of the new capital after each capital increase,

- Generally, enter into all agreements, take all measures and complete all formalities required for the issuance and


servicing of Warrants 2015 and Warrants 2023 and the exer-cise of the rights attached thereto;

9. decides that this delegation is granted for a period of eighteen (18) months from this General Meeting.

Resolution K (Amendment of Article 27 II of the Ar-ticles of Association - Double voting rights)

The General Meeting, voting under the quorum and majority conditions required for Extraordinary General Meetings, having considered the report of the Board of Di-rectors, resolves to amend Article 27 of the Articles of As-sociation on the introduction of a double voting right for every share held for at least four years in order to benefit from the legal system set up by the Florange Act:

« II - Voting rights attached to shares is proportionate to the capital representative. The same par value, each share capital or dividend shares is entitled to one vote.

Any holder of fully paid shares, which justifies to have

been registered in his name in accordance with the last paragraph of Article L.225-123 of the French Commercial Code, enjoys the double voting rights provided by law. Furthermore, in case of capital increase by incorporation of reserves, profits or share premiums, the double voting right is granted, on their issue, to registered shares allo-cated to a shareholder in respect of new shares for which he enjoys this right.

Shares converted to bearer shares or whose ownership is transferred loses the double voting right.

However, transfer through inheritance, liquidation of community property between spouses or inter vivos gift to a spouse or relative entitled to inherit does not lose the right and do not interrupt the period mentioned in the last paragraph of Article L.225-123 of the French Commercial Code. »

The General Meeting consequently decides to delete the words «four (4) years» mentioned in Article 11 Vl.5 of the Articles of Association that refer to this section 27.

III] RESOLUTIONS PROPOSED BY SPC LUX SARL

By letter dated 5 June 2015, the company SPC Lux Sarl holding approximately 4.805% of the share capital of the Company, asked the Board to include in the agenda of the general meeting complementary resolutions, for the fol-lowing reasons:

«From a Belvédère press release dated 2 June 2015, and Diana Holding company information dated 3 June 2015, SPC Lux Sarl learned the resignation of four independent directors with effect at the end of the Meeting General to be held 30 June 2015 (Mrs. Christine Mondollot, Mrs. Constance Benqué, Mr. Ghiot Benoît and Mr. Benoît Herault), at the request of the company Diana Holding.

According to our understanding, the company Diana Hol-ding proposed on its side the appointment of four new members of the Board.

In our view, the proposals of Diana Holding company have the effect of taking control of the management bodies of Belvédère by the concert organized by Diana Holding Company and the Castel group, even though it holds that 22.97% of the share capital and 22.75% of the voting rights Belvédère.

The voice of the President of the Board remaining pre-ponderant under the provisions of article 13 of the Articles of Association, it is desirable that the majority of the Board has to be composed of independent members within an uncontrolled company such as Belvédère.

Thus, SPC Lux Sarl proposes that all mandates of the directors currently in office are placed at the disposal of shareholders at the Belvedere General Meeting to be held 30 June 2015.

In this regard, and given the already resignations and already proposed by Mrs Christine Mondollot, Mrs Constance Benqué, Mr. Ghiot Benoît and Mr. Benoît He-rault, SPC Lux Sarl also proposes to submit to a vote of confidence, during the General Meeting, the mandates of other non-current directors resigned (namely Mrs. Rita Maria Zniber, Mr. Jacques Bourbousson and Mr. Mehdi Bouchaara) and therefore proposes the revocation of the aforementioned directors, who are responsible for the at-tempted takeover out of general meeting of Belvédère ma-nagement bodies. «

As a result of the above, the company SPC Lux Sarl re-quested the inclusion of the following resolutions:

« Resolution L (Revocation of Mrs. Rita Maria Zniber as Director)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, decide to revoke Rita Maria Zniber of her functions of Di-rector. Consequently, her mandate expires at the close of this General Meeting.

Resolution M (Revocation of Mr. Jacques Bourbousson as Director)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, decide to revoke Jacques Bourbousson of his functions of Director. Consequently, his mandate expires at the close of this General Meeting.

Resolution N (Revocation of Mr. Mehdi Bouchaara as Director)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings,


decide to revoke Mehdi Bouchaara of his functions of Di-rector. Consequently, his mandate expires at the close of this General Meeting. »

3) DECISIONS OF THE BOARD OF DIRECTORS

The Board was informed of all resolutions proposed and below state the reasons for its approval or refusal of ap-proval for each of the resolutions.

Resolution A

The Board notes that the sixth resolution of the text of the resolutions of the General Meeting adopted at its mee-ting dated 2 June 2015 already provides for the appoint-ment of DF Holding, represented by Mrs. Laurence De-quatre, as new director.

Accordingly, the Board considers that the request for inclusion of the resolution A to the agenda of the General Meeting day is devoid of purpose, but confirms, as neces-sary, its approval of the resolution, which actually overlap with the sixth resolution.

Resolution B to E

The Board notes that the resolutions of the General Meeting adopted at its meeting dated 2 June 2015 already provides for the seventh to tenth resolutions that the Ge-neral Assembly take note of the resignations of Mrs. Chris-tine Mondollot, Mrs. Constance Benqué, Mr. Benoît Ghiot and Mr. Benoît Ghiot, effective at the close of the General Meeting, and decides on their appointment (or their affi-liate) with effect from the close of the General Meeting and after the effective date of their resignation.

Accordingly, the application for registration of resolu-tions B to E to the agenda of the General Meeting pro-viding the revocation of the aforementioned directors is devoid of purpose, the resolutions proposed by the Board of Directors already settin to challenge the mandate of the aforementioned directors. A vote against the seventh to tenth resolutions render non relevant voting on resolutions B to E.

Accordingly, the Board decided not to approve resolu-tions B to E, since it offers a revocation of directors having already given their mandate available to shareholders.

Resolutions F

The Board reiterates that the fifth resolution of the text of the resolutions adopted at the meeting of the Board of Directors on 2 June 2015 already offers to shareholders the possibility of appointing Mr. Guillaume de Belair as a new member of the Board of Directors of the Company.

Accordingly, the Board considers that the request for inclusion of the resolution F is devoid of purpose, and

confirms, as necessary, its approval to the resolution, which does overlap with the fifth resolution.

Resolutions G and H

The Board notes that the appointment of Mr. Nicolas Gailly and Pierre Beuchet as new directors was requested by Diana Holding Company, holding approximately 17.36% shareholder of the share capital of the Company.

The Board of Directors has decided not to accept resolu-tions G and H for the following reasons:

(a) the Committee on Appointments and Remunera-tion, as a whole, has not been in the opportunity to hear the two candidates proposed by Diana Holding despite his request to Diana Holding;

(b) the Board is not able to appreciate the truly in-dependent character of those candidates against other members of the concert said between Diana Holding and DF Holding, even though this independence is crucial to appreciate the Board of Directors control or not;

(c) the Committee on Appointments and Remunera-tion noted that candidates profiles were essentially facing vineyard at the expense of spirits sector. But the repre-sentation of the Board by the wine sector professionals is already assured by the administrators appointed by the Member of the concert between Diana Holding and DF Holding companies.

(d) the composition of the Board, as requested by the conjunction between Diana Holding and DF Holding Holding companies would not receive the necessary skills. Indeed, financial expertise, marketing or advertising are underrepresented, while all the listed groups of wines and spirits in the world to benefit.

In these circumstances, the Board has decided not to ac-cept the resolutions G and H.

Resolution I

The Board notes that the appointment of Mr. Serge He-ringer as a new director was requested by Diana Holding company, holding approximately 17.36% shareholder of the share capital of the Company.

The Board of Directors decided not to approve re -solution I insofar as (i) it has already approved the ap-pointment of DF Holding as a new director and, (ii) an additional appointment of another Diana Holding’s repre-sentative, which owns already, in itself alone, two seats on the Board of Directors, would lead to the revocation of the resigning directors overrepresented in Board of Directors of the concert between Diana Holding and DF Holding in relation to their shareholding in the Company.


In these circumstances, the board decided not to ap-prove resolution I.

Resolution J

The application for registration of resolution J to the agenda of the General Meeting consisting in making a pu-blic exchange offer for the entirety of the existing warrants would lead to simplify the current complex structure of warrants issued by the Company and be capable of secu-ring funding through this to the Company.

The Board reiterates that this is a delegation, that at this stage, and that in case of use of the delegation, the Board will build based on the work of an independant expert and will meet to (a) determine the characteristics of new war-rants to be issued, (b) fix the terms and conditions of is-sue of such new warrants, and (c) set the exchange ratio of new warrants against each existing warrants would be ex-changed, as part of the preparation of the public exchange offer.

Accordingly, the Board considers that the resolution J could be in the interests of the Company and decided to approve the resolution J.

Resolution K

The Board reiterates that Article 27 II of the Company’s Articles of Association provides that:

« Any holder of fully paid shares, which justifies to have been registered in his name for four (4) years at least, en-joys double voting rights provided by law. »

The Board also reiterates that, if the last paragraph of Article L.225-123 of the French Commercial Code states that the double voting rights are entitled to all fully paid shares for which it is justified to have been registered for two years, these provisions are not applicable to compa-nies whose statutes laid down the conditions for granting a prior vote twice for the entry into force of the Florange Law, which is the case with your Company.

The Board of Directors considers that the adoption of the resolution K by the General Meeting would have the effect of increasing the difference in treatment in terms of voting rights for holders of registered shares and bearer shareholders in the exclusive interest of some shareholders.

Accordingly, the Board of Directors considered the re-solution K being proposed in the particular interest of cer-tain shareholders, and not in the interest of the Company, and thus decided not to approve this resolution.

Resolution L to N

As a result of all requests for resolutions to the agenda of the General Meeting conducted by Diana Holding and

DF Holding companies, the board believes it is in the inte-rest of Belvédère that all of the directors give their mandate to be available to shareholders at the General Meeting.

Accordingly, the Board decided to approve resolutions L to N related to directors revocation requests that have not yet submitted their mandate available to shareholders.

On 8 June 2015,

The Board of Directors

7.2 Share buy-back program You will find below the description of the share buyback

program that the General Meeting of 30 June 2015 is ex-pected to allow.

In accordance with articles 241-1 and following of the General Regulations of the AMF and of European Regu-lation No. 2273/2003 of 22 December 2003, the present specification aims to explain the purpose and terms of the program to repurchase its own shares by the Company.

Allocation by purpose of the shares held by the Company

On 31 May 31 2015, the Company holds 3.437 own shares of 26,486,637 shares comprising the share capital, for a total of 0.013% fully allocated to the granting of stock options or free shares .

Objectives of the new share buy-back program

The buy-back program intends to enable the realization of the following:

(i) implement any plan of options to purchase shares of the Company under the provisions of Articles L. 225-177 and following of the French Commercial Code;

(ii) to allocate shares to employees in recognition of their contribution to the company’s profit-sharing and im-plementing any company savings plan on the conditions stipulated by law, in particular Articles L . 3332-1 and fol-lowing of the French Labor Code;

(iii) to allocate shares free of charge under the provi-sions of Articles L. 225-197-1 and following of the French Commercial Code;

(iv) to retain shares for subsequent delivery in payment or exchange in connection with external growth transac-tions;


(v) deliver shares upon the exercise of rights attached to securities giving access to the share capital by redemption, conversion, exchange, presentation of a warrant or in any other manner;

(vi) cancel all or part of the securities in the context of a reduction of share capital, subject to the adoption of the twenty-first resolution submitted to this General Meeting;

(vii) to ensure liquidity or stimulate the secondary mar-ket for Belvedere shares through an investment service pro-vider under a liquidity contract conforming to the ethical charter recognized by the AMF; and

(viii) implement any market practice that might be ac-cepted by the AMF and more generally, carry out any tran-saction in accordance with regulations.

Maximum share capital, maximum numberand characteristics of shares the Company pro-poses to acquire and maximum purchase price

As the Company owns directly or indirectly 31 May 2015 3.437 of its own shares, corresponding to 0.013% of the share capital, maximum number of shares that may be repurchased on this basis is 2,645,225 shares, representing 9.987% of share capital, it being specified that this possi-bility of redemption may be increased to a maximum of 10% of share capital in case the Company would proceed, before the date of the General Meeting, the sale or use of treasury shares.

The unit purchase price may not exceed thirty-five eu-ros (€ 35). Consequently, the theoretical maximum amount that the Company could pay in the event the unit purchase price maximum of thirty-five euros (€ 35) would amount, based on the current share capital, to ninety-two million se-ven hundred and three thousand one hundred and seventy euros (€ 92,703,170), corresponding to the purchase of a maximum number of 2,648,662 shares.

Duration of the share buy-back program

The buy-back program will run for eighteen (18) mon-ths from the date of the meeting called to authorize, until 30 December 2016.

7.3 Specific reports of the auditors on certain resolu-tions on the agenda of the General Meeting 30 June 2015

Statutory auditors report on capital reduction (Gene-ral Meeting 30 June 2015 - 18th resolution)


In our capacity as Statutory Auditors of your company and in execution of our assignment pursuant to Article L. 225-209 of the French Commercial Code in the event of a capital reduction by cancellation of shares purchased, we have prepared this report to inform you of our assessment of the causes and conditions of the proposed capital re-duction.

Your Board of Directors proposes, on the condition of the adoption of the 14th resolution of this General Mee-ting, to delegate, for a period of eighteen months from the date of this General Meeting, all powers to cancel within the limit of 10% of its capital, by twenty-four month pe-riod, the shares purchased under the implementation of a purchase authorization by your Company of its own shares under the provisions of the above article.

We have implemented the procedures that we conside-red necessary in the professional standards of the Institute of Statutory Auditors relating to this engagement. These procedures consiste in verifying whether the causes and conditions of the proposed capital reduction, which is not likely to undermine the equality of shareholders, are regu-lar.

We have no comment to make on the causes and condi-tions of the proposed capital reduction.



RENART, GUION & ASSOCIES Aurélie TRUCY MAZARS Romain MAUDRY

Dominique MULLER


7.4 Draft resolutions sub-mitted to the General Mee-ting - 30 June 2015

7.4.1 Ordinary General Meeting

First Resolution (Approval of the Company financial statements for the year ended 31 De-cember 2014)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, and having reviewed the Board of Directors’ report and the Statutory Auditors’ general report on the financial state-ments for the financial year ended 31 December 2014,

approves the Company financial statements for the said financial year, as presented to the Meeting, together with all the transactions reflected in those financial statements or summarised in those reports.

Second Resolution (Approval of the consoli-dated financial statements for the financial year ended 31 December 2014)

The General Meeting, voting under the quorum and majority conditions required for Ordinary General Mee-tings, and having reviewed the Board of Directors’ report and the Statutory Auditors’ general report on the consoli-dated financial statements for the financial year ended 31 December 2014,

approves the consolidated financial statements for this financial year, as presented to the Meeting, together with all the transactions reflected in those financial statements or summarised in those reports.

Third Resolution (Appropriation of earnings for the financial year)

The General Meeting, deliberating under the quorum and majority conditions required for Ordinary General Meetings,

notes that the net loss for the 2014 financial year amount to €8,616,544, and

resolves to assign the entire loss for the financial year to retained earnings, the amount of which will therefore decrease from -€492,356,683 to -€500,973,227, on the recom-mendation of the Board of Directors.

The General Meeting notes that it has been reminded that no dividend has been paid since 31 December 2010.

Fourth Resolution (Approval of the agreements referred to in Article L. 225-38 of the French Commercial Code)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, and having reviewed the Statutory Auditors’ special report on the agreements referred to in Article L. 225-38 of the French Commercial Code, as entered into and/or perfor-med during the financial year ended 31 December 2014,

approves the terms of this report and the agreements referred to therein.

Fifth Resolution (Approval of the appointment of Mr. Guillaume de Belair as a new Director)


resolves to appoint Gui l laume de Bela i r, born in Bourges on 6 April 1977, a French national, residing 22, rue Bonaparte – 75006 Paris, as a new Director for a pe-riod of six (6) years expiring at the end of the Ordinary General Meeting of Shareholders called in 2021 to approve the financial statements for the financial year ending on 31 December 2020, and

notes that Guillaume de Belair has stated that he meets all the conditions required in law and by the regulations.

Sixth Resolution (Appointment of DF Holding as a new Director)


resolves to appoint DF Holding, a company governed by Luxembourg law, which has its registered office at 34-38 avenue de la Liberté, L-1930 Luxembourg, Grand Duché du Luxembourg, and is registered with the Luxembourg Trade Registery under No. B44663, as a new Director for a period of six (6) years expiring at the end of the Ordinary General Meeting of Shareholders called in 2021 to approve the financial statements for the financial year ending on 31 December 2020, and



Seventh Resolution (Resignation and appoint-ment of Mrs. Christine Mondollot as Director)


takes note of the resignation of Mrs Christine Mondol-lot for her mandate as member of the Company’s Board of Directors, effective at the close of this General Meeting,

resolves to appoint Christine Mondollot, born in Saint-Cloud on 30 August 1954, a French national, residing 40, avenue Bosquet – 75007 Paris, as a Director for a period of six (6) years expiring at the end of the Ordinary Ge-neral Meeting of Shareholders called in 2021 to approve the financial statements for the financial year ending on 31 December 2020, and

notes that Christine Mondollot has stated that she meets all the conditions required in law and by the regulations.

Eighth Resolution (Resignation and appoint-ment of Mrs. Constance Benqué as Director)


takes note of the resignation of Mrs Constance Benqué for her mandate as member of the Company’s Board of Di-rectors, effective at the close of this General Meeting,

resolves to appoint Constance Benqué, born in Bou-logne Billancourt on 4 July 1960, a French national, resi-ding 180, rue de Grenelle – 75007 Paris, as a Director for a period of six (6) years expiring at the end of the Ordinary General Meeting of Shareholders called in 2021 to approve the financial statements for the financial year ending on 31 December 2020, and

notes that Constance Benqué has stated that she meets all the conditions required in law and by the regulations.

Ninth Resolution (Resignation and appointment of Mr. Benoit Hérault as Director)


takes note of the resignation of Mr Benoit Hérault for his mandate as member of the Company’s Board of Direc-tors, effective at the close of this General Meeting,

resolves to appoint Benoit Hérault, born in Argenteuil

on 11 May 1967, a French national, residing Chemin de Justice – 30700 Uzès, as a Director for a period of six (6) years expiring at the end of the Ordinary General Mee-ting of Shareholders called in 2021 to approve the financial statements for the financial year ending on 31 December 2020, and

notes that Benoit Hérault has stated that he meets all the conditions required in law and by the regulations.

Tenth Resolution (Resignation of Mr. Benoit Ghiot and appointment of Riverside Manage-ment s.p.r.l. as Director)


takes note of the resignation of Mr Benoit Ghiot for his mandate as member of the Company’s Board of Directors, effective at the close of this General Meeting,

resolves to appoint Riverside Management s.p.r. l, a company governed by Belgian law, which has its registered office at 275, avenue Parc d’Amée – 5100 Dave (Belgium), and is registered with the Belgian Trade Registry under No. 0603993759, as a new Director with effect from this Ge-neral Meeting for a period of six years until the General Meeting called in 2021 to approve the financial statements for the financial year ending on 31 December 2020, and

notes that Benoît Ghiot, Riverside Management’s per-manent representative for the same period of six years, has stated that he meets all the conditions required in law and by the regulations.

Eleventh Resolution (Approval of the appoint-ment of Mr. Mehdi Bouchaara as a Director)

The General Meeting, voting under the quorum and majority conditions required for Ordinary General Mee-tings, and having reviewed the minutes of the meeting of the Company’s Board of Directors on 24 October 2014, pursuant to which Mehdi Bouchaara was appointed as a Director for the remaining term of his predecessor’s office, i.e. until the General Meeting called in 2019 to approve the financial statements for the financial year ending on 31 December 2018,

therefore approves the aforementioned appointment, in accordance with Article 13 IV of the Company’s Articles of Association.

Twelfth Resolution (Determination of the amount of directors’ fees to be allocated to the Board of Directors)

The General Meeting, voting under the quorum and ma-


jority conditions required for Ordinary General Meetings and on the recommendation of the Board of Directors,

resolves to allocate a maximum overall annual amount

of directors’ fees of four hundred and sixty-five thousand euros (€465,000) from the 2015 financial year (included) onwards, in accordance with the provisions of Article L. 225-45 of the French Commercial Code, on the understan-ding that the task of dividing the directors’ fees between the Directors will be left to the Board of Directors, which will be free to determine the amounts allocated to each member at its own discretion.

Thirteenth Resolution (Appointment of a new incumbent Statutory Auditor for the Company)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, notes that the term of office of the Company’s incumbent Statutory Auditor expires today, and therefore

resolves to appoint KPMG SA, a limited company with share capital of € 5,497,100, which has its registered office at 3 cours du Triangle – Immeuble Palatin – 92939 Paris la Défense Cedex, registered with the Nanterre Trade and Companies Register under No. 775 726 417, as the new incumbent Statutory Auditor for a period of six (6) years expiring at the end of the Ordinary General Meeting called to approve the financial statements for the financial year ending on 31 December 2020, and

notes that the new incumbent Statutory Auditor has ac-cepted this appointment and meets all the conditions re-quired in law and by the regulations in force.

Fourteenth Resolution (Appointment of a new alternate Statutory Auditor for the Company)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, notes that the term of office of the Company’s alternate Statutory Auditor expires today, and therefore

resolves to appoint Salustro Reydel, a limited company with share capital of € 3,824,000, which has its registered office at 3 cours du Triangle – Immeuble Palatin – 92939 Paris la Défense Cedex, registered with the Nanterre Trade and Companies Register under No. 652 044 371, as the new alternate Statutory Auditor for a period of six (6) years ex-piring at the end of the Ordinary General Meeting called to approve the financial statements for the financial year ending on 31 December 2020, and

notes that the new alternate Statutory Auditor has ac-cepted this appointment and meets all the conditions re-quired in law and by the regulations in force.

Fifteenth Resolution (Approval of the specific commitment made to the Chief Executive Offi-cer)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, and having reviewed the Statutory Auditors’ special report on the agreements referred to in Article L. 225-38 of the French Commercial Code,

notes the conclusions of the aforementioned Statutory

Auditors’ report and approves, for all intents and purposes and pursuant to Article L. 225-42-1 of the French Commer-cial Code, the commitment made to Jean-Noël Reynaud, the Company’s Chief Executive Officer, set out in that re-port in respect of the payment in escrow of an amount of two hundred and ninety-four thousand euros (€ 294,000) by the Company in order to enable the payment of the amounts relating to the GSC guarantee to Jean-Noël Rey-naud, in accordance with the terms of his letter of appoint-ment.

Sixteenth resolution (Opinion on the remunera-tion components payable or paid to Jean-Noël Reynaud in his capacity as the Company’s Chief Executive Officer)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, having been consulted pursuant to the recommendation in Paragraph 24.3 of the AFEP-MEDEF Corporate Gover-nance Code, and having reviewed the Management Report on this issue and taken cognizance of the fact that Jean-Noël Reynaud’s office as the Company’s Chief Executive Officer began on 5 May 2014,

issues a favourable opinion on the remuneration compo-nents payable or paid to Jean-Noël Reynaud in his capacity as the Company’s Chief Executive Officer for the financial year ended 31 December 2014.

Seventeenth Resolution (Authorisation granted to the Board of Directors to perform transac-tions in the Company’s shares on the stock exchange)

The General Meeting, voting under the quorum and ma-jority conditions required for Ordinary General Meetings, and having reviewed the report of the Board of Directors, in accordance with the provisions of Articles L. 225-209 et seq. of the French Commercial Code and Regulation 2273/2003 issued by the European Commission on 22 De-cember 2003,

authorises the Board of Directors to perform transac-tions in the Company’s shares on the stock exchange or otherwise,

resolves that this authorisation is intended to enable the


Company to:

(i) implement any stock option plan for the Com-pany’s shares under the provisions of Articles L. 225-177 et seq. of the French Commercial Code;

(ii) allot shares to employees as part of their partici-pation in the benefits of the Company’s expansion, and implement any corporate savings scheme under the condi-tions provided for in law, in particular Articles L. 3332-1 et seq. of the French Labour Code;

(iii) allot bonus shares under the provisions of Articles L. 225-197-1 et seq. of the French Commercial Code;

(iv) retain shares with a view to subsequently deli-vering them as payment or exchange as part of external growth transactions;

(v) deliver shares upon exercise of rights attached to securities giving access to the Company’s share capital via redemption, conversion, exchange, presentation of a war-rant or in any other way;

(vi) cancel all or some of the shares, as part of a share capital decrease, subject to the adoption of the 21st Reso-lution submitted to this General Meeting;

(vii) ensure liquidity or boost the secondary market in Belvédère shares via an investment service provider, under the terms of a liquidity agreement that complies with the code of ethics recognised by the French Financial Markets Authority; and

(viii) implement any market practice that might beco-me accepted by the French Financial Markets Authority and, more generally, to perform any transaction that com-plies with the regulations in force,

resolves that the number of shares purchased cannot re-sult in an increase in the number of treasury shares held by the Company above 10% of the total number of shares that make up the share capital,

notes that the number of shares purchased by the Com-pany with a view to holding and subsequently delivering them either as payment or in exchange for other securi-ties as part of a merger, demerger or contribution may not exceed 5% of the Company’s share capital, in accordance with statutory provisions,

resolves that the shares may be purchased via any means and in compliance with the applicable stock exchange regulations and the accepted market practices published by the French Financial Markets Authority, and by using any financial derivatives or options traded on regulated or over-the-counter markets, provided that the latter means do not contribute to a significant increase in the volatility of the shares,

notes that the Company reserves the option of carrying out block share purchases,

notes that the Company reserves the option of conti-nuing to execute this share buyback programme during periods of public tender or exchange offers involving its equity securities,

resolves that the purchase unit price may not exceed thirty-five euros (€ 35) and that, as a result, the maximum theoretical amount that the Company would be likely to pay in the event that it purchased shares at the maximum unit price of thirty-five euros (€ 35) would amount to ni-nety-two million, seven hundred and three thousand, one hundred and seventy euros (€ 92,703,170), based on the maximum amount of 2,648,662 shares to be bought,

resolves that, in the event of a change in the share par value, a capital increase via capitalisation of reserves and the allotment of bonus shares, a stock split or reverse stock split, a redemption or reduction of the share capital, a dis-tribution of reserves or other assets and any other transac-tions involving equity capital, the prices set out above will be adjusted via a multiplication coefficient equal to the ratio between the number of shares comprising the share capital prior to the transaction and the number of shares following the transaction,

resolves that, in order to ensure the execution of this authorisation, all powers will be granted to the Board of Directors, with the option of further delegation, with a view to implementing this authorisation and, in particular, assessing the appropriateness of launching a buyback pro-gramme and determining the terms and conditions of that programme, preparing and publishing the information cir-cular relating to the implementation of the buyback pro-gramme, placing all orders on the stock exchange, entering into all agreements, including for the purpose of keeping the share purchase and sale ledgers, making any declara-tions to the French Financial Markets Authority and any other body, completing any other formalities and, in gene-ral, doing everything that is required,

recalls that the Board of Directors will provide sharehol-ders with the information relating to the execution of the share purchase transactions authorised under this resolu-tion in a special report presented to the Annual General Meeting, including the number and price of the shares purchased in this way for each purpose, and the volume of the shares used for these purposes, together with any reallocations for other purposes involving the shares, and

resolves that this authorisation will be granted for a pe-riod of eighteen (18) months from this General Meeting and will invalidate any other delegation having the same purpose.


7.4.2 Extraordinary General Meeting

Eighteenth Resolution (Change in the Com-pany’s name and corresponding amendment to the Company’s Articles of Association)

The General Meeting, voting under the quorum and majority conditions required for Extraordinary General Meetings, and having reviewed the report of the Board of Directors,

resolves to change the Company’s current name of “Bel-védère” and to adopt the name of

“Marie Brizard Wine & Spirits”,

and accordingly resolves to amend Article 3 of the Com-pany’s Articles of Association as follows:

“The company name is:

Marie Brizard Wine & Spirits

The company name must be immediately preceded or followed by the words “Société Anonyme” [limited com-pany] or the initials “SA” followed by the amount of the share capital on all deeds and documents issued by the Company.”

Nineteenth resolution (Transfer of the registe-red office and corresponding amendment to the Company’s Articles of Association)


resolves to transfer the registered office to the following address: 19, boulevard Paul Vaillant Couturier – 40, quai Jean Compagnon – 94200 Ivry-sur-Seine, and accordingly

resolves to amend Article 4 of the Company’s Articles of Association as follows:

“The registered office is located at 19, boulevard Paul Vaillant Couturier – 40, quai Jean Compagnon – 94200 Ivry-sur-Seine.

It may be transferred to any other location in the same Department or any neighbouring Department via a simple decision of the Board of Directors, subject to the approval of this decision by the next Ordinary General Meeting, and to anywhere else in France pursuant to a resolution of the Extraordinary General Meeting of Shareholders.

In the event of a transfer decided by the Board of Di-rectors, the Board is authorised to amend the Articles of Association accordingly”.

Twentieth resolution (Updates and correspon-ding amendments to the Company’s Articles of Association)


resolves to update the Articles of Association in com-pliance with (i) the provisions of Article L. 233-9 of the French Commercial Code and (ii) the provisions of Article R. 225-85 of the said Code, and accordingly

resolves to amend

(i) the fourth paragraph of Article 9 of the Articles of Association as follows, on the understanding that the remaining provisions of the article remain unchanged:

“Any private individuals or legal entities that come to hold an interest of at least 2.5% in the Company’s share capital or voting rights, or a multiple of that percentage, either directly or indirectly, on a stand-alone basis or in concert, immediately or in the future, pursuant to an agree-ment or to a financial instrument listed in Article L. 211-1 of the French Monetary and Financial Code, and under the conditions referred to in paragraphs 4 and 4bis of Article L. 233-9 of the French Commercial Code, must inform the Company within a timeframe of five (5) trading days via a registered letter with request for acknowledgement of re-ceipt sent to the registered office.”;

(ii) the last paragraph of Article 25 of the Articles of Association as follows, on the understanding that the re-maining provisions of the article remain unchanged:

“on the second business day prior to the General Mee-ting at midnight, Paris time”.

Twenty first resolution (Authorisation to be granted to the Board of Directors to decrease the share capital by cancelling treasury shares)

The General Meeting,

voting under the quorum and majority conditions re-quired for Extraordinary General Meetings, and

having reviewed the report of the Board of Directors and the Statutory Auditors’ report, and

subject to the adoption of the Fourteenth Resolution submitted to this General Meeting, which authorises the Board of Directors to purchase shares in the Company un-der statutory terms and conditions, authorises the Board, including an option of further delegation, to:

(i) cancel the shares in the Company purchased as


the result of buybacks performed under the terms of Ar-ticle L. 225-209 of the French Commercial Code, up to a limit of 10% of the share capital for each twenty-four (24)-month period, at any time and with no further forma-lities, in one or several instalments, on the understanding that this limit applies to an amount of the Company’s share capital that will be adjusted, where applicable, to take into account transactions affecting the share capital subsequent to this General Meeting,

(ii) decrease the share capital accordingly, allocating the difference between the purchase value of the cancelled shares and their par value to distributable share premiums or reserves, and

(iii) amend the Articles of Association accordingly and complete any formalities required, and

resolves that this authorisation will be granted for a pe-riod of eighteen (18) months from the date of this General Meeting and will invalidate, with effect from this Meeting, the unused portions of any prior delegations having the same purpose.

Twenty second resolution (Powers to effect formalities)

The general meeting of shareholders gives full power to any bearer of an original, a copy or an excerpt of these mi-nutes to make all legal and administrative formalities and carry out all filings and any publicity required by law.

7.4.3 Resolutions requested by shareholders

Resolution A [Approved, as necessary, by the Board of Directors, as it is the same as the sixth resolution] (Appointment of DF Holding as a new Director)


resolves to appoint DF Holding as a new Director for a period of six (6) years expiring at the end of the Ordinary General Meeting of Shareholders called in 2021 to approve the financial statements for the financial year ending on 31 December 2020, and


Resolution B [Not approved by the Board of Directors] (Revocation of Mr. Benoît Hérault as Director)


decide to revoke Benoit Hérault of his functions of Di-rector. Consequently, his mandate expires at the close of this General Meeting.

Resolution C [Not approved by the Board of Di-rectors] (Revocation of Mrs. Constance Benqué as Director)


decide to revoke Constance Benqué of her functions of Director. Consequently, her mandate expires at the close of this General Meeting.

Resolution D [Not approved by the Board of Directors] (Revocation of Mr. Benoît Ghiot as Director)


decide to revoke Benoit Ghiot of his functions of Direc-tor. Consequently, his mandate expires at the close of this General Meeting.

Resolution E [Not approved by the Board of Di-rectors] (Revocation of Mrs. Christine Mondollot as Director)


decide to revoke Christine Mondollot of her functions of Director. Consequently, her mandate expires at the close of this General Meeting.

Resolution F [Approved, as necessary, by the Board of Directors, as it is the same as the fifth resolution] (Appointment of Mr. Guillaume de Belair as a new Director)


resolves to appoint Guillaume de Belair as a new Direc-tor for a period of six (6) years expiring at the end of the Ordinary General Meeting of Shareholders called in 2021 to approve the financial statements for the financial year ending on 31 December 2020, and


notes that Guillaume de Belair has stated that he meets all the conditions required in law and by the regulations.

Resolution G [Not approved by the Board of Directors] (Appointment of Mr. Nicolas Gailly as a new Director)


resolves to appoint Nicolas Gailly a new Director for a period of six (6) years expiring at the end of the Ordinary General Meeting of Shareholders called in 2021 to approve the financial statements for the financial year ending on 31 December 2020, and

notes that Nicolas Gailly has stated that he meets all the conditions required in law and by the regulations.

Resolution H [Not approved by the Board of Di-rectors] (Appointment of Mr. Pierre Beuchet as a new Director)


resolves to appoint Pierre Beuchet as a new Director for a period of six (6) years expiring at the end of the Ordina-ry General Meeting of Shareholders called in 2021 to ap-prove the financial statements for the financial year ending on 31 December 2020, and

notes that Pierre Beuchet has stated that he meets all the conditions required in law and by the regulations.

Resolution I [Not approved by the Board of Di-rectors] (Appointment of Mr. Serge Heringer as a new Director)


resolves to appoint Serge Heringer as a new Director for a period of six (6) years expiring at the end of the Ordina-ry General Meeting of Shareholders called in 2021 to ap-prove the financial statements for the financial year ending on 31 December 2020, and

notes that Serge Heringer has stated that he meets all the conditions required in law and by the regulations.

Resolution J [Approved by the Board of Direc-tors] (Delegation granted to the Board of Direc-tors to issue new share warrants of the Com-pany, without preferential subscription rights, in favor of holders of old share warrants that would be transfered to the Company through a public exchange offer)

The General Meeting, voting under the quorum and majority conditions required for Extraordinary General Meetings, having considered the report of the Board of Di-rectors and the special report of the auditors in accordance with Articles L. 225-129, L.225-129-1, L.225-135, L.225-138 and L.228-91 and following of the French Commercial Code:

1. delegates to the Board of Directors the powers to de-cide to issue, without preferential subscription rights for shareholders, warrants of the Company’s shares (« War-rants 2015 »);

2. decides that the warrants will be issued in 2015 in return for the surrender in exchange for securities trans-ferred to the Company under a public exchange offer ini-tiated by the Company under the conditions set out below, and they will have the following characteristics:



share;

3. decides, in order to encourage the exercise of war-rants before February 29, 2016, the holders who would exercise their Warrants 2015 before that date would also receive another free warrant, for each warrant exercised in 2015, a new warrant which would have the following cha-racteristics (« Warrants 2023 »):



share;

4. decides to eliminate the shareholders’ preferential subscription rights for Warrants 2015 issuance to exis-ting warrant holders of the Company, namely the holders o f Wa r ra nt s 2 0 0 4 ( B V D B S ) , B S A 2 0 0 6 ( B V D B R ) , B S A Shareholder 1 (BVDBV ), BSA Shareholder 2 (BVDBW ) and BSA OS (BVDBX), who would have tranfered their warrants through a public exchange offer initiated by the Company for all of the existing warrants;

5. notes that, in accordance with the provisions of Article L.225-132 of the French Commercial Code, this delegation automatically entails, in favor of holders of Warrants 2015 and Warrants 2023, express waiver by shareholders of their preferential right of the shares to which these warrants would give right;


6. resolves that the nominal amount of capital increases likely to be made under this delegation is set at:

- A maximum of eleven (11) million upon exercise of the Warrants 2015,

- A maximum of eleven (11) million on exercise of the Warrants 2023,

being specified that to these amounts would be added, where applicable, the nominal amount of additional shares to be issued, in accordance with the law and applicable contractual provisions, to preserve the rights of holders of securities convertible into shares of the Company;

7. decides that the exchange ratios of the Warrants 2015 against each strain existing warrants of the Company will be determined by the Board in connection with the prepa-ration of the public exchange offer and will be reviewed by an independent expert mandated by the Company which will provide an evaluation report, it being specified that the transaction referred to this resolution will be subject to an information note that will be subject to approval by the AMF authority ;

8. resolves that the Board of Directors would have full powers to implement, as provided by law and within the limits set by this resolution, this delegation of powers, in particular to:

- Determining the final characteristics of Warrants 2015 and Warrants 2023,

- Set the terms and conditions of the issues,- Modify, where appropriate, in agreement with the hol-

ders of Warrants 2015 and / or Warrants 2023, all the cha-racteristics after their issue,

- At its sole initiative, charge the costs of the capital in-creases to the amount of the premiums and deduct from this amount the sums necessary to bring the reserve to one tenth of the new capital after each capital increase,

- Generally, enter into all agreements, take all measures and complete all formalities required for the issuance and servicing of Warrants 2015 and Warrants 2023 and the exer-cise of the rights attached thereto;

9. decides that this delegation is granted for a period of eighteen (18) months from this General Meeting.

Resolution K [Not approved by the Board of Directors] (Amendment of Article 27 II of the Articles of Association - Double voting rights)

The General Meeting, voting under the quorum and majority conditions required for Extraordinary General Meetings, having considered the report of the Board of Di-rectors, resolves to amend Article 27 of the Articles of As-sociation on the introduction of a double voting right for every share held for at least four years in order to benefit from the legal system set up by the Florange Act:

« II - Voting rights attached to shares is proportionate to the capital representative. The same par value, each share capital or dividend shares is entitled to one vote.

Any holder of fully paid shares, which justifies to have

been registered in his name in accordance with the last paragraph of Article L.225-123 of the French Commercial Code, enjoys the double voting rights provided by law. Furthermore, in case of capital increase by incorporation of reserves, profits or share premiums, the double voting right is granted, on their issue, to registered shares allo-cated to a shareholder in respect of new shares for which he enjoys this right.

Shares converted to bearer shares or whose ownership is transferred loses the double voting right.

However, transfer through inheritance, liquidation of community property between spouses or inter vivos gift to a spouse or relative entitled to inherit does not lose the right and do not interrupt the period mentioned in the last paragraph of Article L.225-123 of the French Commercial Code. »

The General Meeting consequently decides to delete the words «four (4) years» mentioned in Article 11 Vl.5 of the Articles of Association that refer to this section 27.

Resolution L [Approved by the Board of Direc-tors] (Revocation of Mrs. Rita Maria Zniber as Director)


decide to revoke Rita Maria Zniber of her functions of Director. Consequently, her mandate expires at the close of this General Meeting.

Resolution M [Approved by the Board of Direc-tors] (Revocation of Mr. Jacques Bourbousson as Director)


decide to revoke Jacques Bourbousson of his functions of Director. Consequently, his mandate expires at the close of this General Meeting.

Resolution N [Approved by the Board of Direc-tors] (Revocation of Mr. Mehdi Bouchaara as Director)


decide to revoke Mehdi Bouchaara of his functions of Director. Consequently, his mandate expires at the close of


this General Meeting.

It is reminded that the Board of Directors of 2 June 2015 decided to change the agenda and the resolutions pu-blished in the « BALO » on 22 May 2015, in particular concerning the appointments within the Board of Direc-tors.

Resolution O (Appointment of Mr. Jean-Pierre Cayard as a new Director)


resolves to appoint Jean-Pierre Cayard as a new Direc-tor for a period of six (6) years expiring at the end of the Ordinary General Meeting of Shareholders called in 2021 to approve the financial statements for the financial year ending on 31 December 2020, and

notes that Jean-Pierre Cayard has stated that he meets all the conditions required in law and by the regulations.

7.5 Resolution voting results for the Combined Gene-ral Meeting held on 30 Juin 2015

7.5.1 Ordinary General Meeting

First Resolution: Approval of the Company financial statements for the year ended 31 December 2014: Appro-ved (99.4 % favorable votes)

Second Resolution: Approval of the consolidated finan-cial statements for the financial year ended 31 December 2014: Approved (99.5 % favorable votes)

Third Resolution: Appropriation of earnings for the fi-nancial year: Approved (99.6 % favorable votes)

Fourth Resolution: Approval of the agreements referred to in Article L. 225-38 of the French Commercial Code: Ap-proved (91.1 % favorable votes)

Fifth Resolution: Approval of the appointment of Mr. Guillaume de Belair as a new Director: Approved (74.5 % favorable votes)

Sixth Resolution: Appointment of DF Holding as a new

Director: Approved (92.6 % favorable votes)

Seventh Resolution: Resignation and appointment of Mrs Christine Mondollot as Director: Approved (96.2 % favorable votes)

Eighth Resolution: Resignation and appointment of Mrs Constance Benqué as Director: Approved (96.1 % fa-vorable votes)

Ninth Resolution: Resignation and appointment of Mr Benoit Hérault as Director: Approved (96.2 % favorable votes)

Tenth Resolution: Resignation of Mr Benoit Ghiot and appointment of Riverside Management s.p.r.l. as Director: Approved (95.6 % favorable votes)

Eleventh Resolution: Approval of the appointment of Mehdi Bouchaara as a Director: Approved (91.6 % favo-rable votes)

Twelfth Resolution: Determination of the amount of directors’ fees to be allocated to the Board of Directors: Approved (98.4 % favorable votes)

Thirteenth Resolution: Appointment of a new incu-mbent Statutor y Auditor for the Company: Approved (99.2 % favorable votes)

Fourteenth Resolution: Appointment of a new alternate Statutory Auditor for the Company: Approved (99.3 % fa-vorable votes)

Fifteenth Resolution: Approval of the specific com-mitment made to the Chief Executive Officer: Approved (98.4 % favorable votes)

Sixteenth resolution: Opinion on the remuneration components payable or paid to Jean-Noël Reynaud in his capacity as the Company’s Chief Executive Officer: Appro-ved (94.0 % favorable votes)

Seventeenth Resolution: Authorisation granted to the Board of Directors to perform transactions in the Com-pany’s shares on the stock exchange: Approved (93.4 % favorable votes)

7.5.2 Extraordinary General Meeting

Eighteenth Resolution: Change in the Company’s name and corresponding amendment to the Company’s Articles of Association: Approved (99.5 % favorable votes)

Nineteenth resolution: Transfer of the registered office and corresponding amendment to the Company’s Articles of Association: Approved (99.5 % favorable votes)


Twentieth resolution: Updates and corresponding amendments to the Company’s Articles of Association: Approved (94.9 % favorable votes)

Twenty first resolution: Authorisation to be granted to the Board of Directors to decrease the share capital by cancelling treasury shares: Approved (98.1 % favorable votes)

Twenty second resolution: Powers to effect formalities: Approved (99.6 % favorable votes)

7.5.3 Resolutions requested by shareholders

Resolution B: Revocation of Mr. Benoît Hérault as Di-rector: Rejected (5,0 % favorable votes)

Resolution C: Revocation of Mrs. Constance Benqué as Director: Rejected (4,4 % favorable votes)

Resolution D: Revocation of Mr. Benoît Ghiot as Direc-tor: Rejected (4,5 % favorable votes)

Resolution E: Revocation of Mrs. Christine Mondollot as Director: Rejected (4,4 % favorable votes)

Resolution I: Appointment of Mr. Serge Heringer as a new Director: Approved (65,7 % favorable votes)

Resolution J: Delegation granted to the Board of Direc-tors to issue new share warrants of the Company, without preferential subscription rights, in favor of holders of old share warrants that would be transfered to the Company through a public exchange offer: Approved (84.0 % favo-rable votes)

Resolution K: Amendment of Article 27 II of the Ar-ticles of Association - Double voting rights: Rejected (45.3 % favorable votes)

Resolution L: Revocation of Mrs. Rita Maria Zniber as Director: Rejected (16.5 % favorable votes)

Resolution N: Revocation of Mr. Mehdi Bouchaara as Director: Rejected (16.7 % favorable votes)

Resolution O: Appointment of Mr. Jean-Pierre Cayard as a new Director: Approved (92.6 % favorable votes)


8.1 Person responsible for the Registration Document

Jean-Noël Reynaud, Managing Director of Marie Bri-zard Wine & Spirits.

8.2 Declaration by the per-son responsible for the Re-gistration Document

“I hereby declare, after having taken all reasonable mea-sures to this effect, that the information contained in the present Registration Document is, to my knowledge, a re-flection of the true situation and contains no omission of such a nature as to alter the scope thereof.

I have obtained from the statutory auditors a letter of completion in which they state that they have verified the information concerning the financial position and the fi-nancial statements provided in the present Registration Document and have read the entire Registration Docu-ment.

The statutory auditors issued reports on the historical financial information included in this Registration Docu-ment. These reports are to be found on page 133 of the

2012 Registration Document - report on the 2012 conso-lidated financial statements; on page 135 of the 2013 Re-gistration Document - report on the 2013 consolidated fi-nancial statements and on page 127 of the present 2014 Registration Document - report on the 2014 consolidated financial statements.

These reports contain the following reservations, obser-vations and conclusions:

- the report on the consolidated financial statements for the year ended 31 December 2012 contains a reservation concerning various inadequacies in the organisation and the operation of the accounting and financial processes in-volved in the internal control mechanism of the Belvédère Group. This reservation was also formulated in the reports on the consolidated financial statements for the 2008, 2009, 2010 and 2011 financial years. The report specifies that the situation had not changed since 2011 and remained liable to affect the exhaustive identification of the commitments entered into by the Group as well as the risks and due reco-gnition thereof in the published accounting and financial information.

This report further indicates that, pending the final court decisions, there is a doubt at present concerning the court approvals and the final terms of the implemen-tation of the rehabilitation and business continuity plans, the terms and conditions of the debt repayment and the impact of the foregoing on the consolidation scope, the valuation of assets, the amount of liabilities, the financing structure and, if applicable, the continuity of the opera-tions of the Company and its Subsidiaries. Consequently, the report states that the valuation of the Group’s assets and liabilities, based on the assumption that all of these

PERSON RESPONSIBLE FOR THE REGISTRATION DOCUMENT

8


Group entities will continue to operate as going concerns for the next 12 months, may not be appropriate if all or some of the decisions of the Extraordinary General Mee-ting are annulled and/or if the court judgements already delivered or to be delivered within the framework of ap-proval proceedings concerning the various rehabilitation plans relating to the Company and its subsidiaries are unfavourable or if, after the financial restructuring, all or some of the Group entities are unable to finance their com-mitments undertaken within the framework of the various plans and their operations.

This report also states that the management report does not include the social and environmental information re-quired under Article L. 225-102-1 of the French Commer-cial Code.

- the report on the consolidated financial statements for the year ended 31 December 2013 contains a reservation concerning inadequacies in the organisation and the ope-ration of the accounting and financial processes involved in the internal control mechanism of the Belvédère Group. The report states that, despite the appointment of inde-pendent directors during the year, the establishment of an audit committee and the introduction of cash management monitoring procedures, the current procedures relating to the financial control of the subsidiaries and preparation of the financial statements are still inadequate at present. The report states that, inter alia, this situation is liable to affect the exhaustive identification of the commitments entered into by the Group and the due recognition thereof in the published accounting and financial information.

- the report on the consolidated financial statements for the year ended 31 December 2014 contains observations on the note 1.1 linkek to «Work conducted on strengthening the organization and operation of financial and accounting procedures contributing to the control », items that meet the shortcomings that had led the auditors to enter a reser-vation in their reports from previous years; on paragraphs 2 and 3 of the note 1.2 respectively exposing changes made to the presentation of the consolidated income statement and the new mandatory standards; on the note 4.4 that describes the particular charges related to the financial res-tructuring of the group and finally on the note 7.2 which describes the main potential litigation and liabilities and in particular the dispute between various Group companies to the tax authorities.

Finally, it is clarified that this Registration Document contains the interim consolidated financial statements at 30 June 2015, financial information covered by a statuto-ry auditors’report, appearing on page 158, and containing an observation on the Note 27 which describes the main potential litigation and liabilities and in particular the dis-pute between various Group companies to the tax autho-rities. ”

14 October 2015

Jean-Noël Reynaud Managing Director

8.3 Documents incorpo-rated by reference

I n accordance with Ar t ic le 28 of (EC ) Regulat ion 809/2004 issued by the European Commission on 29 April 2004, this Registration Document incorporates the fol-lowing information by reference:

- with respect to the financial year ended 31 December 2012: the consolidated financial statements included in Section 5.1 of the 2012 Registration Document, the Sta-tutory Auditors’ report on the consolidated financial sta-tements included in Section 5.2 of the 2012 Registration Document, the Statutory Auditors’ special report on the regulated agreements and undertakings shown in Section 6.3.3 of the 2012 Registration Document, the report of the Chairman of the Board of Directors, and the Statutory Au-ditors’ report on the report of the Chairman of the Board of Directors included in Sections 6.5.1 and 6.5.2 of the 2012 Registration Document.

- with respect to the financial year ended 31 December 2013: the consolidated financial statements included in Section 5.1 of the 2013 Registration Document, the Sta-tutory Auditors’ report on the consolidated financial sta-tements included in Section 5.2 of the 2013 Registration Document, the Statutory Auditors’ special report on the regulated agreements and undertakings shown in Section 6.3 of the 2013 Registration Document, the report of the Chairman of the Board of Directors, and the Statutory Au-ditors’ report on the report of the Chairman of the Board of Directors included in Sections 6.5.1 and 6.5.2 of the 2013 Registration Document.

8.4 Documents available to the public

The Company’s founding and updated Articles of As-sociation, Statutory Auditors’ reports for the last three fi-nancial years and other company documents required by current regulations may be consulted at the Company’s headquarters, 19, boulevard Paul Vaillant Couturier – 40, quai Jean Compagnon – 94200 Ivry-sur-Seine.

The sec t ion entit led “Regulator y Publ icat ions” on the Company’s Internet site is available at the following address: http://www.belvedere.fr/.

This space contains the regulatory information circu-lated by the Company in application of the provisions of Articles 221-1 ff. of the General Regulation of the AMF.


APPENDIX

CHAPTER 1PERSONS RESPONSIBLE

1.1 / Person responsible for the Registration Document → See paragraph 8.1 1.2 / Declaration by the person responsible for the Registration Document → See paragraph 8.2 CHAPTER 2STATUTORY AUDITORS

2.1 / Incumbent and alternative statutory auditors → See paragraph 2.10.52.2 / Resignation or appointment of statutory auditors → See paragraph 2.10.5

CHAPTER 3SELECTED FINANCIAL INFORMATION

3.1 / Selected annual financial information → See paragraph 1.6 3.2 / Selected intermediary financial information → See paragraph 2.2 bis

CHAPTER 4RISK FACTORS

4 / Risk factors linked to Company’s businesses → See paragraphs 2.4 & 2.4 bis

CHAPTER 5INFORMATION ABOUT THE ISSUER

5.1 / History and development of the issuer → See paragraphs 1.1 & 2.15.2 / Investments → See paragraph 2.6

CHAPTER 6 BUSINESS OVERVIEW

6.1 / Principal activities of the Company → See paragraphs 1.4 & 1.56.2 / Principal markets of the Company → See paragraphs 1.4 & 1.56.3 / Influence of exceptional factors → See paragraph 2.16.4 / Possible dependency linked to material patents, licences and industrial contracts → See paragraph 1.8 6.5 / Competitive environment and positioning in the business sector of the Company → See paragraphs 2.1 & 2.4 bis

CHAPTER 7ORGANISATION STRUCTURE

7.1 / Brief description of the Group structure → See paragraphs 1.2 & 2.57.2 / List of subsidiaries of the Company → See paragraph 2.5

CHAPTER 8PROPERTIES, PLANTS AND EQUIPMENTS

8.1 / Existing or planned material tangible fixed assets → See paragraph 1.78.2 / Environmental issues that may affect the issuer’s utilisation of its tangible fixed assets → See paragraph 3.1.9

CHAPTER 9OPERATING AND FINANCIAL REVIEW

9.1 / Financial situation → See paragraphs 2.2.1 & 2.2.1 bis9.2 / Operating results → See paragraphs 2.2.2 & 2.2.2 bis

R E G I S T R AT I O N D O C U M E N T C R O S S R E F E R E N C E TA B L E R E G A R D I N G A P P E N D I X I O F CO M M I S S I O N REGULATION («DIRECTIVE PROSPECTUS»)


CHAPTER 10CAPITAL RESOURCES

10.1 / Issuer’s capital resources → See paragraph 2.2.3 10.2 / Sources and amounts of cash flows → See paragraph 2.2.3 & 2.2.2 bis10.3 / Borrowing requirements and funding structure → See paragraph 2.2.310.4 / Restrictions on the use of capital resources → Not applicable10.5 / Anticipated sources of funds → See paragraph 2.6.3

CHAPTER 11RESEARCH AND DEVELOPMENT, PATENTS AND LICENCES

11.1 / Research and development → See paragraph 2.10.211.2 / Patents, licences and trademarks → See paragraph 2.1

CHAPTER 12TREND INFORMATION

12.1 / Significant trends since 1st January 2015 → See paragraphs 2.3 & 2.2 bis12.2 / Major commitments or events likely to have a material effect on the Group’s prospects → See paragraphs 2.3 & 2.4

CHAPTER 13 PROFIT FORECASTS OR ESTIMATES

13 / Profit forecasts or estimates → Not applicable

CHAPTER 14 ADMINISTRATIVE, MANAGEMENT AND SUPERVI-SORY BODIES AND SENIOR MANAGEMENT

14.1 / Administrative and management bodies → See paragraphs 2.7 & 2.7 bis14.2 / Administrative and management bodies’ conflicts of inte-rest → See paragraphs 5.3 & 5.4

CHAPTER 15REMUNERATION AND BENEFITS

15.1 / Amount of remuneration paid and benefits in kind granted → See paragraphs 2.7.2 & 2.7.2 bis15.2 / Amounts set aside or accrued by the issuer or its subsidia-ries to provide pension, retirement or similar benefits → See paragraph 2.7.2 & 2.7.2 bis

CHAPTER 16BOARD PRACTICES

16.1 / Offices of members of the administrative, management and supervisory bodies of the Company → See paragraphs 2.7.1 & 2.7.1 bis16.2 / Service contracts between members of the Board of the Company and any of its subsidiaries → See paragraph 5.316.3 / Information on board committees → See paragraph 2.7.3 & 2.7.1 bis16.4 / Corporate governance principles → See paragraph 5.1.1

CHAPTER 17 EMPLOYEES

17.1 / Number of employees → See paragraphs 2.8.1 & 2.8 bis17.2 / Sharholdings and stock options held by managers and members of the administrative, management and supervisory bodies → See paragraph 2.7.217.3 / Employee share ownership agreement → See paragraph 2.8.2

CHAPTER 18 MAJOR SHAREHOLDERS

18.1 / Shareholders → See paragraphs 2.9.2 & 6.318.2 / Voting rights to the main shareholders → See paragraphs 2.9.2 & 6.318.3 / Control of the issuer → See paragraphs 2.9.2 & 6.3.318.4 / Arrangements that could result in a change of control of the issuer → See paragraphs 2.9.2 & 6.3

CHAPTER 19. RELATED PARTY TRANSACTIONS

19.1 / Related party transactions descriptions → See paragraph 5.319.2 / Statutory auditors report on related party transactions → See paragraph 5.4


CHAPTER 20.FINANCIAL INFORMATION CONCERNING THE ISSUER’S ASSETS AND LIABILITIES, FINANCIAL POSITION, PROFITS AND LOSSES

20.1 / Historical financial information → Not included 20.2 / Pro forma financial information → Not applicable 20.3 / Consolidated financial statements → See paragraph 4.120.4 / Auditing of consolidated financial statements → See paragraph 4.220.5 / Age of the latest financial information → 30 June 201520.6 / Interim and other financial information → See paragraph 4.320.7 / Dividend policy → See paragraph 6.420.8 / Legal and arbitration proceedings → See paragraph 2.4.420.9 / Significant change in the issuers’s financial or trading position → See paragraph 2.3

CHAPTER 21.ADDITIONAL INFORMATION

21.1 / Share capital → See paragraph 2.9.1 21.2 / Memorandum and Articles of Association → See paragraph 6.2

CHAPTER 22. IMPORTANT CONTRATS

22 / Important contrats → See paragraph 1.8

CHAPTER 23. THIRD PARTY INFORMATION, STATEMENT BY EXPERTS AND DECLARATION OF INTEREST

23 / Third party information, statement by experts and declara-tion of interest → Not applicable

CHAPTER 24. DOCUMENTS ON DISPLAY

24 / Documents available for the public → See paragraph 8.4

CHAPTER 25. INFORMATION ON HOLDINGS

25.1 / Holding and its subsidiaries → See paragraphs 2.5 & 4.1