Subsection 3: Capital amortisation.

Sums deducted from company profits pursuant to the second paragraph of article L. 225-200 are recorded in a reserve account. The same applies to sums paid by shareholders pursuant to article L. 225-201. When the shares are unequally amortised, a reserve account is opened for each of the equally amortised classes of shares.

When the amount of a reserve account provided for in the first paragraph of Article R. 225-146 is equal to the amortised amount of the shares or the corresponding class of shares, the amortised shares shall be converted into capital shares and the company’s Articles of Association shall be amended in accordance with the provisions of Article L. 225-203.

When the conversion of amortised shares into capital shares has been carried out under the conditions provided for in Article L. 225-201, no later than the end of each financial year, the Articles of Association shall be amended to reflect any conversions of shares carried out during that financial year.

Fully or partially amortised shares whose conversion into capital shares has been decided are entitled, for each financial year, and until such conversion is completed, to the first dividend or interest in lieu thereof calculated on the amount, at the close of the previous financial year, of the reserve account provided for in the first paragraph of Article R. 225-146. In addition, partially amortised shares continue to benefit from the…