SECTION 626-1

The extraordinary general meeting, based on the report of the board of directors or the general director, as the case may be, and on the special report of the auditor, may authorize the board of directors or the general director, as the case may be, to proceed in favor of employees of the company or certain categories of them, with an allotment free of charge of existing shares or to be issued. Resolutions passed in the absence of the reports referred to in this paragraph shall be null. The extraordinary general meeting shall fix the maximum percentage of the stated capital that can be allotted under the conditions defined in the first paragraph. The total number of shares allocated, free of charge, may not exceed ten percent (10%) of the stated capital on the date the decision of their allotment by the board of directors or the general director, as the case may be, was taken. It also sets the timetable during which this authorization may be effected by the board of directors or the general director, as the case may be. This period cannot exceed thirty-six (36) months. When the allotment pertains to shares to be issued, the authorization given by the extraordinary general meeting automatically means that shareholders waive their pre-emptive subscription rights entails, in favor of the beneficiaries of shares allotted free of charge, renunciation by shareholders to their pre-emptive subscription right. The matching capital increase is definitely achieved on the sole fact of the final allotment of shares to beneficiaries. The allotment of shares to their beneficiaries shall be final at the end of a vesting period which minimal duration, that may not be less than two (2) years, is determined by the extraordinary general meeting. However, the meeting may provide for the final allotment of shares before the end of the vesting period in the event of disability of the beneficiary being unable to perform any occupation. The extraordinary general meeting shall also set the minimum period of the obligation of retaining shares by the beneficiaries. This period begins on the date of the final allotment of shares, but may not be less than two (2) years. However, shares are freely transferable in the event of disability of the beneficiary being unable to perform any occupation. Where the extraordinary general meeting has selected a vesting period mentioned in the fifth paragraph of a duration of at least four (4) years for all or part of the shares alloted, it can reduce or eliminate the duration of the obligation of retaining, mentioned in the sixth paragraph, such shares.