AXWAY_REGISTRATION_DOCUMENT_2017

AXWAY GROUP AND ITS BUSINESS ACTIVITIES

CORPORATE RESPONSIBILITY

CORPORATE GOVERNANCE

CONSOLIDATED FINANCIAL STATEMENTS

2017 ANNUAL FINANCIAL STATEMENTS

CAPITAL AND AXWAY SOFTWARE STOCK

INFORMATIONS ADMINISTRATIVES ETbJURIDIQUES

COMBINED GENERAL MEETING OFb6bJUNEb2018

Notes to the financial statements

e. Analysis of the change in recognized actuarial differences in relation to Axway Software Actuarial differences result solely from the changes in present value of the obligation, in the absence of plan assets. These differences include the effects of changes in actuarial assumptions and the effects of the differences between the actuarial assumptions used and actual experience (experience adjustments detailed below).

The €1,241Ǿ thousand actuarial gain recognized for Axway Software inǾ2017 was mainly the result of: ● actuarial differences from experience adjustments (€745Ǿthousand decrease in the commitment); ● differences arising from changes in the turnover table (€486Ǿthousand decrease in the commitment); ● differences related to the change in the mortality table (€8Ǿthousand increase in the commitment); ● differences related to the change in the departure procedures (€17Ǿthousand decrease in the commitment).

Experience adjustments on Axway Software scheme liabilities are shown in the table below:

31/12/2017

31/12/2016

31/12/2015

Current value of obligation with respect to defined benefits

5,221 -745

6,196

6,571

Experience adjustments on plan liabilities

274

249

Experience adjustments on plan liabilities (in % of commitments)

-14.27%

4.43%

3.78%

The breakdown by maturity of the Axway Software’s retirement benefits commitment in France, discounted at 1.77%, is shown in the table below:

31/12/2017

(in thousands of euros)

Present value of theoretical benefits to be paid by the employer:

less than 1 year from 1 to 2 years from 2 to 3 years from 3 to 4 years from 4 to 5 years from 5 to 10 years from 10 tob20 years more than 20 years

196 124 215 313 285

4

●

●

●

●

●

1,525 1,928

●

●

635

●

Total commitment

5,221

f. Sensitivity testing of the discount rates forbthebAxway Software retirement benefits A 0.25% increase in the discount rate would result in a €139.9Ǿ thousand decrease of our provision for retirement benefits. A 0.25% decrease in the discount rate would result in a €145.6Ǿthousand increase in our provision for retirement benefits. 5.4 Share-based and similar payment expenses a. Share subscription options The application of IFRSǾ2 to Axway relates to options for share subscription options and allocations of bonus shares granted to employees. As allowed under the standard, the Group will only adjust its financial statements for options granted on or after 7ǾNovember 2002 and exercisable after 1ǾJanuary 2005.

The fair values of the share subscription options awarded beforeǾ 2011 were determined using the binominal model recommended by IFRSǾ2. The exercise price of the options under the 2011 plan was determined using the average of the closing prices for the 20Ǿtrading days prior to the date on which the decision was made to allocate options. This value is consistent over the plan’s duration. The value attributed to the options is analyzed as a cost of services rendered by employees in return for the options and is recognized on a linear basis over the vesting period. This charge is recognized in the income statement under Stock option plans and similar expenses, balanced by a credit to an issue premiums account recognized under Capital reserves within shareholders’ equity. There is thus no net impact on consolidated shareholders’ equity. The calculation performed reflects the total number of options held at each balance sheet date by eligible employees.

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AXWAY - 2017 REGISTRATION DOCUMENT