Under the provisions of the new article 533-4 of the Monetary and Financial Code which came out of the Financial Security Code, voting has become mandatory for management companies.

In accordance with articles 322-75 to 322-79 of the General Regulations of the Financial Market Authority, MONTSEGUR FINANCE has set up a procedure called the “voting policy” which introduces the conditions under which it intends to exercise the voting rights attached to the securities held by the investment funds it manages.

This detailed procedure is available at the company’s headquarters.

Exercise of voting rights

MONTSEGUR FINANCE will have to vote for any security held representing at least 60% of the assets of the investment funds managed by the company and/or once it holds, as part of its management activity, at least 3% of the securities put on the market by a single issuer for a single category of securities.

Below this threshold, the management company has no significant and influential participation in terms of voting rights.

Foreign companies for which it would be especially difficult (lack of information, blockage of securities for too long a time) or costly to vote are excluded.

Voting policy principles

Managers, or someone delegated by them, will vote independently for or against the resolutions offered.

When the managers take a position on a security, they follow the company’s leadership plan and trust its management.

However, they will carefully follow the recommendations of the AFG (French Management Association).

Certain sensitive subjects are always studied in detail; they involve proposals concerning:

• issues of shares without preferential right of subscription for those who are already shareholders
• capital increases in the case of a takeover bid or any other anti-takeover measures
• issues of warrants or any other security giving access to the capital to the exclusive advantage of one category of shareholders (employees, for example) thereby leading to a dilution of the other shareholders.

Consequently, in these specific cases of defence of minority shareholders who are indirectly bearers of shares of the pooled investment funds of MONTSEGUR FINANCE, the management company reserves the right to vote against such resolutions.

Conflicts of interest

MONTSEGUR FINANCE is an independent management company held by its directors and employees and is not part of any multiple-activity financial establishment that may be the source of conflicts of interest.

As indicated in the company’s code of ethics, which is kept available to all, the managers must exclude from their area of work any security likely to present a conflict of interest.

Furthermore, all of the company’s employees are required to declare the accounts they hold as well as the accounts belonging to members of their families and managed by them. Operations on these accounts are subject to monthly audits by Internal Audit.

How voting rights are exercised

Concerned with implementing the voting policy, MONTSGEGUR FINANCE favours voting by mail but reserves the right, according to circumstances, to vote by physical participation in shareholder meetings or by giving power to the president of the company or, exceptionally, by proxy.

Report on exercise of voting rights

MONTSEGUR FINANCE prepares a report on the exercise of voting rights within four months following the close of its financial year at December 31.

This report is available at the company’s headquarters, 39 rue Marbeuf – 75008 Paris.