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Auditors' special report on the authorization
to increase the capital and to issue share equivalents
with pre-emptive subscription rights
Free translation of the original report in French.
To the Shareholders,
In our capacity as Statutory Auditors of Schneider
Electric SA and pursuant to Article L.228-92 et seq.,
L.225-135-1 and L.225-148 of the Commercial Code,
we present below our report on the authorizations
sought by the Management Board to increase the
Company’s capital by issuing, on one or several occa-
sions, shares or share equivalents with pre-emptive
subscription rights in an aggregate maximum amount
of 500 million. Within this ceiling, the number of com-
mon shares or share equivalents to be issued may be
increased by a maximum amount of 15% for each
issue (eleventh resolution).
The issued share capital may be increased pursuant
to the ninth resolution by a maximum aggregate
amount of 500 million; the ceilings set in this resolu-
tion and the tenth resolution are not cumulative. The
aggregate par value of the issued securities may not
exceed 1.5 billion.
You are asked to authorize the Management Board,
on the basis described in its report, to increase the
Company’s issued share capital directly or through a
representative on one or several occasions by issuing
common shares or share equivalents with pre-emp-
tive subscription rights, for a period of 26 months. If
the resolution is adopted, the Management Board will
set the terms and conditions of these transactions.
The Management Board is responsible for reporting to
shareholders on the proposed share issue in accor-
dance with Articles 154 and 155 of the Decree of
March 23, 1967. Our responsibility is to express an
opinion on the fairness of figures taken from the finan-
cial statements and of certain other information
included in this report.
We carried out our work in accordance with French
professional standards. Those standards require that
we perform procedures to check the content of the
report drawn up by the competent management body
concerning these transactions and the method used
to determine the share issue price.
We have no matters to report concerning the method
for determining the issue price as described in the
Management Board’s Report, contingent upon our
final review of the terms of the proposed capital
increase.
Since the issue price has not yet been set, we cannot
formulate an opinion on the final conditions under
which the share issue(s) will be carried out.
Should this resolution be approved and as required by
Article 155-2 of the Decree of March 23, 1967, we will
prepare an additional report at the time the capital
increase(s) is (are) carried out by the Management
Board.
Courbevoie and Neuilly-sur-Seine, February 20, 2007
The Statutory Auditors
Ernst & Young et Autres Mazars & Guérard
Christian Chochon Pierre Sardet
Pierre Jouanne Jean-Louis Simon
181
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