SECTION 853-14

The auditor or, where there is none, the company president shall present to shareholders a report on agreements concluded directly between the company and its president, one of its managers, one of its shareholders holding a fraction of voting rights higher than ten per cent (10%) or, if it is an affiliated company, the company controlling it within the meaning of article 174 above. The same rule shall apply to agreements where one of the persons referred to in the first paragraph has an indirect interest or deals with the company through an intermediary. Shareholders shall act on the report. Those with direct or indirect interests shall not take part in the vote and their shares shall not be taken into account for the calculation of quorum and majority. Decisions taken in violation of this article shall be null. Unapproved agreements shall nevertheless produce their effect, leaving it to the individual with a direct interest and possibly the president and other managers shall be liable for the harmful consequences to the company. Any resolution passed without the auditor’s or the president’s report shall be null. By derogation to the provisions of the first paragraph, where the company has only a sole shareholder, agreements concluded directly or through an intermediary between the company and its officer or one of its officers shall only be mentioned in the special register of decisions. When the agreement is concluded with the sole shareholder, no mention shall be made in the register and the auditor is not required to prepare a report.