Financial glossary

Annual General Meeting of Shareholders
A company holds a meeting of its shareholders at least once a year and within six months after the closing of the annual accounts. The annual meeting of shareholders approves the accounts and elects members of the Board of Directors. An extraordinary, or special meeting of shareholders is called for special operations such as mergers, capital increase, etc

Autorité des Marchés Financiers (AMF))
The AMF is the French market regulator, equivalent to the U.S. Securities and Exchange Commission (SEC). It was created by the Financial Security Act approved by the French Parliament in August 2003, merging three previous regulatory agencies, the Commission des Opérations de Bourse (COB), the Conseil des Marchés Financiers (CMF) and the Conseil de Discipline de la Gestion Financière (CDGF). The AMF is responsible for protecting savings invested in marketable securities, as well as for the information reported to investors and the efficient functioning of markets.

CAC 40
The French stock market benchmark index, based on the average of the share prices of 40 of the largest French stocks and structured to reflect a cross-section of industries.

Capital gains (losses)
VA capital gain or loss is the difference between the price at which shares are sold and the price at which they were purchased.

Commission des Participations et des Transferts (CPT)
The CPT (formerly called the Commission de Privatisation) is an independent authority that issues opinions on the valuation of a company that may be made by banks advising the French state and the company. The CPT sets the “floor price” for shares sold by the French state.

Contribution au Remboursement de la Dette Sociale (CRDS)
A special tax, due in particular on capital gains, dividends and employer matching shares, used to pay down the debt of French social service agencies. The rate in 2004 is 0.5%.

Contribution Sociale Généralisée (CSG)
A “general welfare tax” levied on capital gains, dividends and employer matching funds. The rate in 2004 is 7.5%.

Dividend
A share of a company’s net profits distributed for each share. The amount can be set each year by the annual general meeting of shareholders, voting on a proposal submitted by the Board of Directors.

Euroclear France
Euroclear France (formerly Sicovam) is the central depository responsible for centralizing and clearing securities transactions between financial intermediaries operating on the Paris market...

Fonds Communs de Placement d’Entreprise (FCPE units)
An FCPE is a portfolio of securities held by all the members of a company who have subscribed shares in the fund. The fund is managed by a fund manager in the exclusive interest of the fund owners

Lockup period
An interval during which shares may not be sold. Market Capitalization The total value of all of a firm’s outstanding shares, calculated by multiplying the market price by the total number of shares outstanding.

Odd lots
Odd lots are a fractional unit of a share that may result from the allocation of bonus shares. The amounts in cash are paid into deposit accounts. Odd lots resulting from difference sources are not combined.

Offre à Prix Ouvert
An OPO is a mechanism used by the French state for an IPO (initial public offering) of a state-owned company. The final price of the IPO is not set until the close of the subscription period.

Plan d’Épargne d’Entreprise (PEE) et Plan d’Épargne Groupe (PEG)
A PEE is a company savings scheme reserved to employees. The plans allow them to acquire a portfolio of securities with aid from the company. These schemes are entitled to tax benefits for dividends reinvested, as well as capital gains realized and, if applicable, a discount on the subscription price. The PEG is a similar savings plan for the employees of all companies in a group.

Plan d’Épargne en Actions (PEA)
A PEA is a share savings plan that benefits from certain tax exemptions for revenue from dividends received and capital gains, in exchange for which the funds remain blocked for five years from the date the account was opened.

Securities account
An account that holds shares and other types of marketable securities.

Securities Services
A company generally contracts management of its securities to a specialized financial establishment. This firm acts as a liaison between the company that issued the securities (shares, bonds, etc.) and Euroclear France (see definition opposite). It is responsible for delivery of the securities sold, and for accounting of all securities transactions (distribution of bonus shares and payment of dividends).

Security
A generic term that covers shares, bonds, shares in mutual funds and other financial instruments.

Settlement-delivery
The settlement date is the date on which the French state delivers shares in exchange for payment.

Share
A unit of ownership in a company, representing a share of its equity. Shares are traded on the stock market.

Share price
The share price is the value of the share at a given moment. It is determined by the balance between demand and supply on stock markets.