Worldline - Registration Document 2016

Risk Factors Regulatory and legal risks

The Group maintains many relationships with and is dependent to a certain extent on its principal shareholder, Atos SE. The Group may encounter difficulties adapting to its status as an independent entity. Atos SE, the Group’s principal shareholder, currently provides services to the Group pursuant to services agreements entered into between the Group and the Atos group at market conditions in connection with the Reorganization Transactions. These include (i) operational services such as internal information services, subcontracting services in connection with projects, global communication and telecommunication services, sales and global marketing strategy services, and purchasing services, and (ii) support functions such as management, mergers and acquisitions, finance, legal and compliance, internal audit, accounting, human resources, insurance and innovation (see Section 19 “Related Party Transactions” and Note 27 to the consolidated financial statements). Therefore, to the extent that these functions remain with the Atos group, the Group is dependent on the Atos group for the provision of these services. The services agreements between the Group and the Atos group pursuant to which such services are provided, which are automatically renewable for successive 12-month periods, contain change of control clauses under which they terminate automatically if Atos SE ceases to hold, directly or indirectly, more than 50% of the share capital of the Company. If the Atos group were to stop providing such services and the Group were unable to replace these services, including through recruiting the necessary workforce or entering into appropriate third party agreements on terms and conditions, including cost, comparable to those with the Atos group, it could have a material adverse effect on the Group’s business, financial condition and results of operations. The Group also benefits from its relationship with and support from the Atos group through cooperation with regard to sales and marketing, which, in particular, permits the Group to take advantage of cross-selling opportunities offered by Atos’ large portfolio of clients. Any interruption of such cooperation could have a material adverse effect on the Group’s business, financial condition and results of operations.

The Group may not be able to rely fully on the Atos group to fund its future financing requirements, and financing from other sources may not be available on favorable terms. In the past, the Group’s financing needs have been satisfied by the Atos group and, since the Company’s shares have been listed on Euronext Paris, the Group benefits from a revolving credit facility initially granted by the Atos group and transferred to Bull International, subsidiary of the Atos group, on January 2, 2016. The maturity of the revolving credit facility is in June 2019 and it may be terminated by the Group at any time without charge or penalty (subject to an indemnity for breakage costs, if any, in the event of prepayment). Bull International has the right to terminate the revolving credit facility if the Atos group ceases to hold at least 25% of the share capital of the Company. The Group’s future capital requirements will depend on many factors, including its rate of revenue growth, the timing and extent of product development expenditure, the expansion of sales and marketing activities, the timing of introductions of new products and enhancements to existing products, the market acceptance of its products and the extent of M&A activity. The Group may need to raise additional funds through public or private equity or debt financing. The Group may not be able to obtain financing with interest rates as favorable as those that the Atos group could provide. If the Group cannot raise funds on favorable terms, if and when needed, it may not be able to further develop its business or invest in new products and services, take advantage of future opportunities, or respond to competitive pressures or unanticipated requirements, which could have a material adverse effect on the Group’s business, financial condition, results of operations and prospects.

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4.3

Regulatory and legal risks

standards affecting the Group’s business could impose costly compliance burdens and have a material adverse effect on the Group’s business. Changes in the laws, regulations, policies or other industry There may be changes in the laws, regulations or other industry standards that affect the Group’s operating environment in substantial and, at times, unpredictable ways in France, at the European level or internationally. Changes to laws, regulations or industry standards, or in their interpretation and implementation, could have a material adverse effect on the Group’s operating costs or its competitive position. Regulation of the payments industry has increased significantly in recent years and continues to increase. Failure to comply with laws, rules and regulations or standards to which the Group is subject in France, Europe and internationally, in particular the

regulations applicable to payment institutions, may result, among other things, in the suspension or revocation of a license or registration, forced replacement of existing management, the limitation, suspension or termination of service, and the imposition of fines, sanctions or other penalties, any of which could have a material adverse effect on the Group’s business, financial condition and results of operations, as well as damage the Group’s reputation. Even if such a change to statutes, regulations or industry standards does not apply directly to the Group, the effects of such a change on the Group’s financial institution clients could result in material, indirect effects on the way the Group operates or the costs to operate the Group’s business and impair demand for the Group’s services among its financial institution clients. In particular, the Group may need to adapt its systems to comply with new regulation requirements such as the unbundling of tariffs, which would also provide

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Worldline 2016 Registration Document

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