Loreal 2011 Annual Report Download - page 216

214 REGISTRATION DOCUMENT − L’ORÉAL 2011
7Stock market information andsharecapital
Shareholder structure
7.3.6.2. Transactions carried out by L’Oréal
with respect to its shares in2011
Percentage of share capital held
bythe Company directly and indirectly
atDecember31st, 2011: 1.43%
Including:
♦those intended to cover existing share
purchase option plans 0.86%
♦those intended to cover conditional shares 0.17%
♦those intended for cancellation 0.00%
Number of shares cancelled during the last
24months: 500,000
Number of shares held in the portfolio
at12.31.2011: 8,597,659
Net book value of the portfolio at 12.31.2011: €644.4million
Market portfolio value at 12.31.2011: €693.8million
Total gross transactions
Purchases Sales/Transfers(1)
Number of shares None 2,739,023
Average transaction
price Not applicable
Average exercise price €76.22
Amounts None €208.8million
(1) Exercise of stock options for the purchase of shares granted to
employees and corporate officers of Group companies.
There is no open purchase or sale position at December31st, 2011.
7.3.6.3. Renewal by the Annual General
Meeting of the authorisation
given tothe Board to trade in
theCompany’s shares
By voting a new resolution, the Annual General Meeting would be
able to provide the Board of Directors with the means to enable
it to continue its share buyback policy.
This authorisation would be given for a maximum period of
18months as from the date of the Annual General Meeting and
the purchase price per share could not exceed €130.
The Company would be able to buy its own shares for the
following purposes:
♦their cancellation;
♦their transfer within the scope of employee share ownership
programmes and their allocation to free grants of shares and/
or share purchase options for the benefit of employees and
corporate officers of the Group;
♦stabilisation of the share price;
♦retaining them and subsequently using them as payment in
connection with external growth operations.
The authorisation would concern up to 10% of the share capital
for a maximum amount of €7,838.8million, it being specified
that the Company may never at any time hold over 10% of its
own share capital.
These shares could be acquired by any means, on one or more
occasions, on the stock market or over the counter, including
through purchases of blocks of shares.
7.3.7. Presentation of the stock
option plans for the
purchase or subscription
of shares and plan for
the Conditional Grant
ofShares to Employees
Policy
For several years, L’Oréal has set up stock option plans in favour of
its employees and corporate officers in an international context.
It pursues a dual objective:
♦motivating and associating those who make big contributions
to future development in the Group’s results;
♦increasing solidarity and helping to instil a Group spirit among
its managers by seeking to foster their loyalty over time.
In2009, L’Oréal enlarged its policy by introducing a mechanism
for the conditional grant of shares to employees .
The objective is:
♦to provide a long-term incentive offering greater motivation
to all those who only received stock options occasionally or
in limited numbers;
♦to reach out to a broader population of potential beneficiaries,
particularly internationally, in a context of increased
competition with regard to talents.
In2010, this policy remained unchanged, and was applied to
an even larger number of beneficiaries.
In2011, L’Oréal decided to make plans for the conditional grant
of shares to employees the primary tool for its long-term incentive
policy by extending the grants of such shares to the Group’s main
senior managers who were previously motivated only through
stock options .
Except for the Chairman and Chief Executive Officer who
received stock options only, the main senior managers of L’Oréal,
including the members of the Executive Committee, received a
mix of stock options and conditional grants of shares in order to
encourage their entrepreneurial spirit and reward their medium
and long-term performance.
Other eligible employees are stimulated by conditional grants
of shares only.
The decision with regard to each individual grant is, in every case,
contingent on the quality of the performance rendered at the
time of implementation of the plan.
According to the eligibility criteria linked to the position held by
the beneficiary and the size of the entity or the country in which