Boussard & Gavaudan Investment Management Llp

Allegations: IN A DECISION PUBLISHED 17 FEBRUARY 2009, ON THE WEBSITE OF THE FRENCH REGULATOR ACCESSIBLE TO ALL, THE AMF ENFORCEMENT COMMITTEE ("COMMITTEE) ISSUED A FINE OF 50,000 EUROS (62,872 DOLLARS) AGAINST BOUSSARD & GAVAUDAN GESTION FOR "FAILED SETTLEMENT". THE COMMITTEE'S DECISION SET OUT THAT BOUSSARD & GAVAUDAN GESTION HAD FAILED TO MEET THE REGULATORY DELIVERY DEADLINE WHILE IT WAS SHORT SELLING SHARES IN INFOGRAMES IN SEPTEMBER 2006 AND JANUARY 2007. THE COMMITTEE EXPLAINS THAT THE THREE-DAY DELIVERY PERIOD, STARTING FROM THE TRADE DATE, APPLICABLE TO TRADES IN FINANCIAL INSTRUMENTS WAS ESTABLISHED ON THE RECOMMENDATION OF THE AMF AND IN THE INTEREST OF THE MARKET SO AS TO MAINTAIN SMOOTH OPERATION AND PREVENT FAILS. FAILURE TO DELIVER SHARES DURING THAT THREE DAY PERIOD - AMOUNTS TO A BREACH OF THE ARTICLE 560-1 OF THE GENERAL RULES OF THE AMF - AND MAY BE PENALIZED EVEN THOUGH CONDITIONS FOR TRIGGERING A "BUY IN" PROCEDURE ARE NOT MET (SHARES NOT DELIVERED WITHIN 10 DAYS AFTER THE TRADE). STILL THE COMMITTEE UNDERLINED THE LACK BOTH OF CLARITY OF THE RULE PRIOR TO SEPTEMBER 2008 AND, THE EXCEPTIONAL CIRCUMSTANCES OF THE SITUATION WITH REGARD TO THE INVOLVEMENT OF BG IN INFOGRAMES RESTRUCTURING AND ACCORDINGLY DECIDED TO LOWER THE FINE. THE COMMITTEE NOTED THAT "PRIOR TO THE DECISION OF THE COMMISSION DATED SEPTEMBER 4, 2008, THE EXACT SCOPE OF THE RULE OF FAILED SETTLEMENT AND HIS COMBINATION WITH THE PROVISIONS RELATING TO THE PROCEDURE OF BUY IN COULD NOT BE DISPLAYED FULLY, AND, SECONDLY, THAT, GIVEN THE CONDITIONS THAT BG HAS GIVEN ITS GARANTEE FOR THE CAPITAL INCREASE, THE FORTHCOMING CREATION OF NEW SHARES TO THE OUTCOME OF THIS OPERATION WAS CERTAIN" THE DECISION HAS BEEN PUBLISHED IN THE "BULLETIN DES ANNONCES LEGALES OBLIGATOIRES", ON THE AMF'S WEBSITE AND IN THE "REVUE DE L'AUTORITÉ DES MARCHÉS FINANCIERS" AMF MONTHLY REVIEW Status: Final Sanction Detail: FINE OF 50,000 EUROS TOTALY PAID IN 2009.($62,872 WITH 1 EURO =1.2574 DOLLARS, 17 FEBRUARY 2009) Summary: IN A DECISION PUBLISHED 17 FEBRUARY 2009, ON THE WEBSITE OF THE FRENCH REGULATOR ACCESSIBLE TO ALL, THE AMF ENFORCEMENT COMMITTEE ("COMMITTEE) ISSUED A FINE OF 50,000 EUROS (62,872 DOLLARS) AGAINST BOUSSARD & GAVAUDAN GESTION FOR "FAILED SETTLEMENT". THE COMMITTEE'S DECISION SET OUT THAT BOUSSARD & GAVAUDAN GESTION HAD FAILED TO MEET THE REGULATORY DELIVERY DEADLINE WHILE IT WAS SHORT SELLING SHARES IN INFOGRAMES IN SEPTEMBER 2006 AND JANUARY 2007. THE COMMITTEE EXPLAINS THAT THE THREE-DAY DELIVERY PERIOD, STARTING FROM THE TRADE DATE, APPLICABLE TO TRADES IN FINANCIAL INSTRUMENTS WAS ESTABLISHED ON THE RECOMMENDATION OF THE AMF AND IN THE INTEREST OF THE MARKET SO AS TO MAINTAIN SMOOTH OPERATION AND PREVENT FAILS. FAILURE TO DELIVER SHARES DURING THAT THREE DAY PERIOD - AMOUNTS TO A BREACH OF THE ARTICLE 560-1 OF THE GENERAL RULES OF THE AMF - AND MAY BE PENALIZED EVEN THOUGH CONDITIONS FOR TRIGGERING A "BUY IN" PROCEDURE ARE NOT MET (SHARES NOT DELIVERED WITHIN 10 DAYS AFTER THE TRADE). STILL THE COMMITTEE UNDERLINED THE LACK BOTH OF CLARITY OF THE RULE PRIOR TO SEPTEMBER 2008 AND, THE EXCEPTIONAL CIRCUMSTANCES OF THE SITUATION WITH REGARD TO THE INVOLVEMENT OF BG IN INFOGRAMES RESTRUCTURING AND ACCORDINGLY DECIDED TO LOWER THE FINE. THE COMMITTEE NOTED THAT "PRIOR TO THE DECISION OF THE COMMISSION DATED SEPTEMBER 4, 2008, THE EXACT SCOPE OF THE RULE OF FAILED SETTLEMENT AND HIS COMBINATION WITH THE PROVISIONS RELATING TO THE PROCEDURE OF BUY IN COULD NOT BE DISPLAYED FULLY, AND, SECONDLY, THAT, GIVEN THE CONDITIONS THAT BG HAS GIVEN ITS GARANTEE FOR THE CAPITAL INCREASE, THE FORTHCOMING CREATION OF NEW SHARES TO THE OUTCOME OF THIS OPERATION WAS CERTAIN" THE DECISION HAS BEEN PUBLISHED IN THE "BULLETIN DES ANNONCES LEGALES OBLIGATOIRES", ON THE AMF'S WEBSITE AND IN THE "REVUE DE L'AUTORITÉ DES MARCHÉS FINANCIERS" AMF MONTHLY REVIEW