DE GRISOGONO S.A.

Plan-les-Ouates

Meeting of the Board of Directors
Held on October 14th, 2013

DATE, TIME AND VENUE: On October 14, 2013, at 14:00 pm. local time, at the of?ces
of the Company in Plan-les-Ouates, Geneva.

ATTENDANCE: The following members of the Board of directors are present in person 

- Mr. Mario Moreira Leite da Silva
- Mr. Fawaz Gruosi

- Mr. John Leitao

- Mr. Farid Koppel

- Mr. Moises Mauricio Toledano

MM. Vasco Rites and Eduardo Sequeira are excused and have given a power of attorney to be

represented to the extent permissible by Mr. Leitao, respectively by Mr. Da Silva.

Also invited are Me Benoit Lambercy, of the law ?rm Python Peter and Mr. Ricardo Jorge,

the FO of the Company.

Mr. da Silva opens the meeting at 14:20 PM and takes the Chair. He designates Mr. John

Leitao to take the minutes of the meeting.

Mr. da Silva presents the agenda.

The convening of the meeting and the agenda are accepted without objection. The Chairman

continues with the ?rst point on the agenda.

1. Review of 2013

M. Leitao distributes a new presentation to the board that updates the one sent by email.

He gives a summary of the presentation, which shows the key milestones implemented in
2013.

Mr. Leitao explains to board members that the Allegra bracelet, the ?rst high volume
product, was successfully launched and had ah?eady become the biggest single reference
since 2008. The 2014 watch novelties have been developed in record time and are
expected to be presented at the next Baselworld. A clear production management was
established and allows the Company to improve delivery and stock ef?ciency. Mr. Leitao
indicates that the Company has recently been able to successfully deliver the wholesalers.

Mr. Leitao con?rms the imminent opening of a boutique in ourchevel (approx. mid
December) and the plan to open a boutique in Miami. The Tokyo and Las Vegas

boutiques were closed and the launch of a new subsidiary in Middle East (Dubai) is
planned. Efforts are also made to reconquer the Harrods boutique.

The new advertisement campaign was implemented. PR was improved by focusing on key
products. Clear guidelines and goals were also established. In the near future (next
quarter) PR will be monitored quarterly. A RM project was implemented to track event
attendants' purchases and measure the ROI of such events. Finally, new website, app,
catalogue and visuals were implemented in 2013.

Mr. Gruosi presents to the board members the results of initial contacts with Mrs. Sharon
Stone, who was already the Ambassador of the Company this year in Cannes. He precises
that although there is no ROI data on Sharon Stone's effect, feedbacks from wholesalers
are very good.

Mr. Leitao indicates that a former employee of the Boston Consulting Group has just
joined the Company. He will focus on long term business strategy.

Mr. Leitao report to the board members that sales are HF 14?000?000.- below budget. As
a result, the EBITDA without restructuring costs is HF 3?900?000.- below budget.

The lower sales performance is due to large shortfall in high jewehy/private sales, partly
compensated by above expected wholesale. Consequently, the armual sales target has been
reduced ?om HF 92'000'000 to HF 

Mr. Gruosi explains to the board members that two important events are still to come in
2013 (Saudi Arabia and Bergdorf) and that the situation may evolve satisfactorily as
private sales are highly unpredictable.

Mr. Leitao explains that the sales shortfall was nevertheless compensated by an
improvement in ?nancial margin by 13%, from 37% in 2012 to 50% in 2013. Upon
question of Mr. Gruosi, Mr. Leitao explains that the important transaction realized in the
summer is not the only cause of such improvement.

Mr. Leitao indicates that, although operational cash needs have been greatly reduced by
improved production control and leverage of stone consigrnnent, most costs of the
company still came in the ?rst three quarters resulting in a lack of cash ?ow. Thus,
shareholders have had to invest HF 5'000'000 more.

Upon question, Mr. Leitao indicates that, mainly due to higher efficiency, the many
investments in management and control have not increased the headquarter's costs. He
mentions that the IT system had become uncontrollable.

To conclude, Mr. Leitao recalls that execution of forecasts are of course dependent on
sales performance until the end of the year. In particular, private sales will need to reach
their new reduced target of CHF 15'000'000, CHF 10'000'000 below its current stand.
Nevertheless, turnaround is well imderway with real sales (as opposed as dump sales)

growing at over 20% and EBITDA improving despite marketing investment increase of
70%.

Mr. da Silva congratulates the team for its good job and wants to emphasize on the
increase of good sales and of the fnrancial margin from 37% to He
sees the 2013 total sales more arormd HIF 85'000'000 than HF 

He explains to the board members that ?xed costs must remain under control and that HR
must be reviewed. He purposes to recruit a new person for this job.

Aggressiveness of sale teams must be increased and private sale teams must be reinforced.
A huge investment must also be made to increase trust with partners. He also wishes a
better coordination and cooperation between marketing and creative team.

Finally, he reports to board members that shareholders are ready to increase their
commitment with the company to support the signi?cative investments needed for the
next three years.

No questions are raised concerning 2013 and the next point on the agenda is treated.

. Strategic vision for the next three years

Mr. Leitao presents the strategic vision of the Company for the next three years to the
board members.

As concerns the products, Mr. Leitao explains that the jewelry collections should be
reduced and rejuvenated. The Company should become a reference player in watch
segment by launching new iconic collections for men and women. In the high jewelry
segment, the Company should become a creditable and widely recognized player in the
value storage product segment. Mr. Leitao recalls that the decision was taken not to offer
large discormts (so-called dump sales) anymore in the future.

As concerns the channels, the Company should focus on pro?table boutiques and
nevertheless expand its regional presence. The key next goal is to set up a Dubai boutique.
In the private sales segment, the Company should establish a team of highly regarded
jewelry/gem specialists which cater to ultra high end client needs. The Company plans to
reach such goal both in-house (gemology trainings) or through external development.

With regards to the geographical expansion, Mr. Leitao explains that the company plans to
open a new boutique in Europe (C ourchevel is opening in December), another new
boutique in Turkmenistan, set up a Middle East subsidiary in Dubai and expand the
wholesale presence in the USA. The company plans to launch presence in China in 2015.

As concerns the restructuring of retail network, Mr. da Silva recalls that the USA are still
the biggest luxury market in the world. He emphasizes on the need for coherence in terms
of budget and a clear defnrition of the company's strategy. The three years plan involves
new investments between CHF 50'000'000 and HF 

Upon question, Mr. Leitao explains that although it is not part of the three years vision,
expansion in Africa will be assru?ed through events and capturing A??ican citizens when
they are travelling. Mr. da Silva indicates that an event will be organized in Angola in the
beginning of next year.

Concerning rental issues, Mr. da Silva explains to the board members that the company is
considering the creation of a new entity focused on real estate, which could rent the
boutiques to the Company. This would permit to split the two different activities and
mitigate the risks.

Presentation of 2014 strategic plan

Mr. Leitao shortly presents to the board members the draft goals for 2014, which include
the continued restructuring of the jewelry assortment, the launch of new watches, the
development of new high jewelry pieces and development of market credibility in the
value storage segment. Three jewehy projects are currently in development.

The margins should be improved by increased pressure on suppliers in order to obtain
reductions ar01md 10 to 20 and through better sourcing and production planning.

The Company's objective is to reach a positive EBITDA for the ?rst time since 2008.
Mr. da Silva explains that marketing investment should remain at the same volume as in

2013. Mr. Leitao explains that the 2014 budget will be build out of the presented plan and
goals. The 2014 budget will be presented to the board members in December.

Mr. Leitao indicates that, at this stage, no validation of the board members is required but
inputs are of course welcome.
No questions are raised.

Miscellaneous

None

The next board meeting will take place on Tuesday 6th of December of 2013 at the
company's of?ces at 14.00 PM.

There being no further business the meeting closed at 4:35 pm.

The Chairman of the Meeting The Secretary of the Meeting

 

 

Mario Moreira Leite da Silva John Leitao