1. Declaration of intent:

The Fountain Group has taken note of the Corporate Governance Code drawn up by the Lippens Commission.

It intends to comply with said Code.

Should the Fountain Group, as a result of its size or characteristics, not apply one of this Code’s recommendations (whether partially or completely), it shall apply the principle of “Comply or Explain”.

2. The company’s corporate government structure

To ensure high quality management, the Fountain Group is organised as follows:
a. Board of Directors
b. Internal workings of the Board of Directors
c. Appointment Committee
d. Remuneration Committee
e. Audit Committee
f. Management Committee

a. Board of Directors

At 30 May 2005, the Board of Directors was comprised of eight directors, including three independent directors.
The criteria for evaluating directors’ independence are those identified by the Corporate Governance Code.
Mr Pierre Vermault will satisfy the conditions for independence in September 2005.
There are no executive directors.

All of the directors’ appointments will expire at 30 May 2005. A proposal will be put forward to the Ordinary General Meeting of 30 May 2005 to renew all of the appointments for a 4-year term.
The Articles of Association stipulate that only the General Meeting appoints the directors, based on a simple majority. The Board of Directors presents the independent directors to the General Meeting and basis its choices on a series of criteria fixed beforehand.
There is no age limit.

Breakdown of the composition of the Board of Directors:

• JEAN DUCROUX,
  Director,
  Jean-Ducroux is chairman and managing director of Electra Partners Europe SA (France) and a director of companies
• ALAIN ENGLEBERT
  Independent director,
  Alain Englebert is a director of companies
• REGNIER HAEGELSTEEN
  Independent director,
  Regnier Haegelsteen is managing director of Banque Degroof (Belgium) and is a director of companies
• BRUNO LAMBERT
  Director,
  Bruno Lambert is a director of a company affiliated with SG Capital Europe Fund I, LP (London) and a director of companies
• PAUL LIPPENS
  Independent director,
  Paul Lippens is chairman of Groupe Sucrier (Belgium) and a director of companies
• PHILIPPE RENIE
  Director,
  Philippe Renie is a director of a company affiliated with SG Capital Europe Fund I, LP (London) and a director of companies
  
• PHILIPPE SEVIN
  Director,
  Philippe Sevin is a director of a company affiliated with SG Capital Europe Fund I, LP (London) and a director of companies
  
• PIERRE VERMAUT
  Chairman,
  director
  Pierre Vermaut has chaired the Board of Directors of Groupe Fountain since February 2000. He is also a director of companies.
  

The Board of Director’s secretariat is ICML S.A., represented by Mr Alain Englebert

b. Internal workings of the Board of Directors

The Board of Directors shall meet as often as necessary for the purposes of the company’s management. On average, it meets between 6 and 7 times a year.

The Board of Director’s main responsibilities are as follows: strategy, annual and multiyear budgets, basic organisation, monitoring of management, the appointment and remuneration of the permanent members of the group’s Management Committee, the fixing of the results and valuation rules, long-term financial commitments, mergers and acquisitions, strategic alliances, divestments, communications policy and stock options.
The Board of Directors is also responsible for organising effective external and internal audits of the company.

The Articles of Association stipulate that the Board of Director’s decisions are taken based on a simple majority of the votes. In the event of a tie, the chairman of the Board’s vote shall be casting.

The Board of Directors is periodically informed of sales results, the losses and profits account, the cash flow position, investments, and any relevant information enabling it to assess the company’s growth and performance.

The Board of Directors also receives for each subject all of the useful information that will enable it to take decisions in those areas in which it is competent.

The Board of Directors has agreed a procedure that stipulates the possibility for its members to make use of independent experts at the company’s expense.

The Board has also agreed a procedure concerning the internal information that must be provided to all of its members.

The Board has also approved the rules concerning the position of director, as well as the rules concerning the holding of meetings of the Board of Directors.

c. Remuneration Committee role and internal rules

The Remuneration Committee is comprised of Mrs Bruno Lambert, director, Paul Lippens, independent director, and is chaired by Mr Pierre Vermaut, chairman of the Board of Directors.

The Committee fixes the remuneration and other benefits allocated to the members of the Board of Directors, as well as to the members of the Management Committee.

Its rules specify the frequency and means of convening meetings, as well as the procedures for taking and recording decisions.

Policy for remunerating non-executive directors
The directors’ work is remunerated using directors’ fees, the amount of which is consistent with market practices.

Policy for remunerating the CEO and other members of the Management Committee.
The remuneration of the members of the Management Committee includes a fixed portion and a variable portion. The group’s policy is to pay remuneration consistent with similar positions in companies of a comparable size and complexity.
The variable portion is linked to the group’s results, as well as to the attainment of personal objectives.
A system of warrants is offered to members of the Management Committee.

d. The Appointment Committee’s role and internal rules

An Appointment Committee was set up within the Remuneration Committee. It is comprised of Mrs Bruno Lambert, director, Paul Lippens, independent director, and is chaired by Mr Pierre Vermaut, independent director.

The Committee defines the criteria for selecting and appointing directors.

Its internal rules specify the frequency and means of convening its meetings, as well as the procedures used for taking and recording decisions.

e. The Audit Committee’s role and internal rules

The Audit Committee is comprised of Mrs Pierre Vermaut, Paul Lippens and Alain Englebert, all three of whom are independent directors. It is chaired by Mr Bruno Lambert, director.

The Audit Committee ensures the integrity of the financial information provided by the company. Management informs the Audit Committee of the methods used to post significant and unusual transactions if more than one accounting entry is possible. The Committee discusses significant financial reporting issues with both management and the auditors.

At least once a year the Audit Committee examines the internal audit systems and risk management systems put in place by management to verify that the main risks are correctly identified, managed and brought to its knowledge.

In 2004, the Audit Committee met four times, each time in the presence of the auditors.

The Audit Committee’s internal rules specify the frequency of meetings, the scope of the Committee’s responsibilities, its investigation powers, and its relationship with the auditors, the CEO, the CFO and the Board of Directors. It also specifies the Committee’s self-evaluation process, as well as the keeping of the meeting minutes.

The Committee has also created a specific mechanism through which the company’s employees may confidentially communicate their concerns with respect to possible financial reporting or other irregularities.

f. Role and rules of the Management Committee

The Management Committee is comprised of the CEO, the CFO and all operational managers for France, International, production and purchasing and machine production.

It is chaired by the CEO.

The Committee operates at the level of the Group. It takes management decisions, coordinates, establishes joint procedures, monitors various projects and determines priorities.
Normally it meets every fifteen days.

Its rules specify meeting frequency, the keeping of agendas, reports and decision-making procedures.

3. Controlling shareholder structure and crossholdings exceeding 5 %

The company’s controlling shareholders are:
SG Capital Europe Fund I, LP (London)
Electra Partners Europe SA (France)

There are no crossholdings exceeding 5%.

4. Identities of the main shareholders and shareholder agreements

Based on the declarations of transparency received on 31 December 2004, the Group’s main shareholders are:

SG Capital Europe Fund I, LP (London): 31.0 %
Electra Partners Europe SA (France): 11.1 %
Quaerocq (Belgium): 8.2 %

There are no shareholders agreements.

5. Direct or indirect relationships between the company and its main shareholders, directors or managers

The Board of Directors has laid down a policy governing the issue of settlements and other contractual relationships – between the company, including affiliated firms, and the shareholders, directors and members of the Management Committee who are not covered by laws concerning conflicts of interest

6. Measures taken to comply with laws on insider tradings and market manipulations

The Board has set down rules with a view to complying with Directive 2003/6/EC on insider transactions and market manipulations.