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

Risk factors

Operational dependence The Company benefits from, and will continue to benefit from, services provided on the basis of contracts negotiated at normal market prices by Sopra Steria GroupǾSA for certain support functions over a transitional period. The cancellation or expiration of one of these contracts could have an unfavorable impact on the Group’s business and financial position (in particular due 1.13.7 Policy with respect to insurance At the date of this document, the Company has implemented, for itself and for the Group, as necessary, an insurance program to protect against the risks to which the Group is exposed, namely civil liability coverage for the Group’s operations and property damage coverage for the Group’s assets. This insurance program covers the risks associated with its operations in IT systems engineering, the design, production, distribution, development, sales and marketing, publishing and/ or installation and maintenance of all equipment, software packages and other software products, consulting, systems integration, training and technical assistance, and the design and production of computer-aided management or manufacturing systems. This insurance program has been taken out with a top-tier insurer, in consultation with and as selected by a broker appointed by the Company. In the opinion of the Group, the insurance policies described below take into account the risks incurred by the Group. However, it is not inconceivable that the Group may be required to pay compensation for losses not covered by the insurance program put in place. 1) Professional liability and operations liability insurance The Group has taken out an insurance policy combining professional liability coverage with premises and operations liability coverage, the purpose of which is to provide protection for the Group’s various entities against the financial consequences of any liability they might incur due to bodily injury, property damage or economic loss, whether consequential or direct, caused to third parties and resulting from the Group’s operations, professional negligence or the goods manufactured, sold and/ or delivered by the Group. This policy also covers the additional expenses incurred to prevent accidents or reduce their impact.

to the Group’s incapacity to handle the functions concerned in- house and/or the related replacement costs). Furthermore, for its activities in India, the Group continues to use the material and Human Resources (157Ǿpeople) seconded by the Sopra Group via its Indian subsidiary Sopra India Private Limited. These resources are invoiced to the Group at a rate negotiated on an annual basis (see NoteǾ31.2 in ChapterǾ4).

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This insurance program is made up of a master policy, which is supplemented by local policies in the countries where the Group has subsidiaries (in particular Germany, Belgium, Brazil, Bulgaria, Spain, the United States, Ireland, Italy, Romania, the Netherlands, Sweden, the UK, Australia, China, Hong Kong and Singapore). The master policy serves to provide broader coverage to the insured than that provided by the local policy and to increase the limits of coverage by supplying additional amounts as necessary. It thus includes “Difference in Conditions” (DIC) and “Difference in Limits” (DIL) clauses. 2) Cyber insurance The Group has implemented a global insurance program dedicated to cyber risks. The parent company Axway Software and all its subsidiaries are covered by this program. Subject to certain conditions, this insurance program covers financial losses following an attack on the security of the IT system and the personal and/or confidential data used by the Group as part of its operations, particularly its Cloud services. 3) Employer’s liability insurance The purpose of this insurance policy is to cover the reimbursement of financial losses incurred by the Company (involving persons covered by laws relating to workplace accidents), comprised of supplementary contributions and compensation provided for in Articles L. 452-2 and L. 452-3 of the French Social Security Code. These financial losses are covered if they result from workplace accidents having occurred or occupational diseases having manifested and been declared during the policy’s validity period.

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AXWAY - 2017 REGISTRATION DOCUMENT